NOMURA HOME EQUITY LOAN, INC., Depositor NOMURA CREDIT & CAPITAL, INC., Sponsor OCWEN LOAN SERVICING, LLC EQUITY ONE, INC. SELECT PORTFOLIO SERVICING, INC. Servicers WELLS FARGO BANK, NATIONAL ASSOCIATION, Master Servicer and Securities Administrator...
NOMURA
HOME EQUITY LOAN, INC.,
Depositor
NOMURA
CREDIT & CAPITAL, INC.,
Sponsor
OCWEN
LOAN SERVICING, LLC
EQUITY
ONE, INC.
SELECT
PORTFOLIO SERVICING, INC.
Servicers
XXXXX
FARGO BANK, NATIONAL ASSOCIATION,
Master
Servicer and Securities Administrator
and
HSBC
BANK
USA, NATIONAL ASSOCIATION
Trustee
Dated
as
of January 1, 2007
NOMURA
HOME EQUITY LOAN, INC.
ASSET-BACKED
CERTIFICATES, SERIES 2007-2
TABLE
OF CONTENTS
ARTICLE
I
DEFINITIONS
|
Section
1.01
|
Defined
Terms.
|
|
Section
1.02
|
Allocation
of Certain Interest Shortfalls.
|
ARTICLE
II
CONVEYANCE OF TRUST FUND REPRESENTATIONS AND WARRANTIES
|
Section
2.01
|
Conveyance
of Trust Fund.
|
|
Section
2.02
|
Acceptance
of the Mortgage Loans.
|
|
Section
2.03
|
Representations,
Warranties and Covenants of the Servicers, the Sponsor and the Master
Servicer.
|
|
Section
2.04
|
Representations
and Warranties of the Depositor.
|
|
Section
2.05
|
Delivery
of Opinion of Counsel in Connection with Substitutions and
Repurchases.
|
|
Section
2.06
|
Issuance
of the REMIC I Regular Interests.
|
|
Section
2.07
|
Conveyance
of the REMIC I Regular Interests; Issuance and Conveyance of the
REMIC II
Regular Interests, the Class X Interest, the Class P Interest and
the
Class IO Interest.
|
|
Section
2.08
|
Issuance
of Class R Certificates and Class R-X Certificates.
|
|
Section
2.09
|
Establishment
of Trust.
|
|
Section
2.10
|
Purpose
and Powers of the Trust.
|
ARTICLE
III
ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS; ACCOUNTS
|
Section
3.01
|
Servicers
to act as Servicers of the Mortgage Loans.
|
|
Section
3.02
|
Due-on-Sale
Clauses; Assumption Agreements.
|
|
Section
3.03
|
Subservicers.
|
|
Section
3.04
|
Documents,
Records and Funds in Possession of the Servicers To Be Held for
Trustee.
|
|
Section
3.05
|
Maintenance
of Hazard Insurance.
|
|
Section
3.06
|
Presentment
of Claims and Collection of Proceeds.
|
|
Section
3.07
|
Maintenance
of Insurance Policies.
|
|
Section
3.08
|
Reserved.
|
|
Section
3.09
|
Realization
Upon Defaulted Mortgage Loans; Determination of Excess Liquidation
Proceeds and Realized Losses; Repurchases of Certain Mortgage
Loans.
|
|
Section
3.10
|
Servicing
Compensation.
|
|
Section
3.11
|
REO
Property.
|
|
Section
3.12
|
Liquidation
Reports.
|
|
Section
3.15
|
Books
and Records.
|
|
Section
3.16
|
The
Trustee.
|
|
Section
3.17
|
REMIC-Related
Covenants.
|
|
Section
3.19
|
Release
of Mortgage Files.
|
|
Section
3.20
|
Documents,
Records and Funds in Possession of the Servicers to be held for
Trustee.
|
|
Section
3.21
|
Possession
of Certain Insurance Policies and Documents.
|
|
Section
3.22
|
[Reserved].
|
|
Section
3.23
|
UCC.
|
|
Section
3.24
|
Optional
Purchase of Defaulted Mortgage Loans; Optional Purchase of Certain
Mortgage Loans.
|
|
Section
3.25
|
[Reserved].
|
|
Section
3.26
|
Collection
of Mortgage Loan Payments; Custodial Accounts.
|
|
Section
3.27
|
Permitted
Withdrawals From the Custodial Accounts.
|
|
Section
3.28
|
Reports
to Master Servicer.
|
|
Section
3.29
|
Collection
of Taxes; Assessments and Similar Items; Escrow Accounts.
|
|
Section
3.30
|
Adjustments
to Mortgage Rate and Scheduled Payment.
|
|
Section
3.31
|
Distribution
Account.
|
|
Section
3.32
|
Permitted
Withdrawals and Transfers from the Distribution Account.
|
|
Section
3.33
|
Credit
Risk Management Services and Reports; Reliability of Data.
|
|
Section
3.34
|
Intellectual
Property and Confidentiality.
|
|
Section
3.35
|
Limitation
Upon Liability of Credit Risk Manager; Indemnification.
|
|
Section
3.36
|
Resignation
or Removal of Credit Risk Manager.
|
ARTICLE
IV
ADMINISTRATION AND MASTER SERVICING OF THE MORTGAGE LOANS
|
Section
4.01
|
The
Master Servicer.
|
|
Section
4.02
|
Monitoring
of the Servicers.
|
|
Section
4.03
|
Fidelity
Bond.
|
|
Section
4.04
|
Power
to Act; Procedures.
|
|
Section
4.05
|
Due-on-Sale
Clauses; Assumption Agreements.
|
|
Section
4.06
|
Documents,
Records and Funds in Possession of Master Servicer To Be Held for
Trustee.
|
|
Section
4.07
|
Standard
Hazard Insurance and Flood Insurance Policies.
|
|
Section
4.08
|
Presentment
of Claims and Collection of Proceeds.
|
|
Section
4.09
|
Maintenance
of the Primary Mortgage Insurance Policies.
|
|
Section
4.10
|
Trustee
to Retain Possession of Certain Insurance Policies and
Documents.
|
|
Section
4.11
|
Realization
Upon Defaulted Loans.
|
|
Section
4.12
|
Compensation
for the Master Servicer.
|
|
Section
4.13
|
REO
Property.
|
|
Section
4.14
|
Obligation
of the Master Servicer in Respect of Prepayment Interest
Shortfalls.
|
ARTICLE
V
ADVANCES
AND DISTRIBUTIONS
|
Section
5.01
|
Advances;
Advance Facility.
|
|
Section
5.02
|
Compensating
Interest Payments.
|
|
Section
5.03
|
REMIC
Distributions.
|
|
Section
5.04
|
Distributions.
|
|
Section
5.05
|
Allocation
of Realized Losses.
|
|
Section
5.06
|
Monthly
Statements to Certificateholders.
|
|
Section
5.07
|
REMIC
Designations, REMIC I, REMIC II, REMIC III, REMIC IV, REMIC V and
REMIC VI
Allocations.
|
|
Section
5.08
|
Prepayment
Charges.
|
|
Section
5.09
|
Class
P Certificate Account.
|
|
Section
5.10
|
[Reserved].
|
|
Section
5.11
|
Basis
Risk Shortfall Reserve Fund.
|
|
Section
5.12
|
Supplemental
Interest Trust.
|
|
Section
5.13
|
Tax
Treatment of Swap Payments and Swap Termination Payments.
|
|
Section
5.14
|
Reports
Filed with Securities and Exchange Commission.
|
|
Section
5.15
|
Derivatives
Collateral Account
|
ARTICLE
VI
THE
CERTIFICATES
|
Section
6.01
|
The
Certificates.
|
|
Section
6.02
|
Certificate
Register; Registration of Transfer and Exchange of
Certificates.
|
|
Section
6.03
|
Mutilated,
Destroyed, Lost or Stolen Certificates.
|
|
Section
6.04
|
Persons
Deemed Owners.
|
|
Section
6.05
|
Access
to List of Certificateholders’ Names and Addresses.
|
|
Section
6.06
|
Book-Entry
Certificates.
|
|
Section
6.07
|
Notices
to Depository.
|
|
Section
6.08
|
Definitive
Certificates.
|
|
Section
6.09
|
Maintenance
of Office or Agency.
|
ARTICLE
VII
THE
DEPOSITOR, THE SERVICERS AND THE MASTER SERVICER
|
Section
7.01
|
Liabilities
of the Depositor, the Servicers and the Master Servicer.
|
|
Section
7.02
|
Merger
or Consolidation of the Depositor, the Servicers or the Master
Servicer.
|
|
Section
7.03
|
Indemnification
by Depositor, the Servicers and Servicing Function
Participants.
|
|
Section
7.04
|
Limitations
on Liability of the Depositor, the Securities Administrator, the
Master
Servicer, the Servicers and Others.
|
|
Section
7.05
|
The
Servicers Not to Resign.
|
|
Section
7.06
|
Appointment
of Special Servicer; Termination of the Servicer.
|
|
Section
7.07
|
Limitation
on Resignation of the Master Servicer.
|
|
Section
7.08
|
Assignment
of Master Servicing.
|
|
Section
7.09
|
Rights
of the Depositor in Respect of the Servicers and the Master
Servicer.
|
ARTICLE
VIII
DEFAULT;
TERMINATION OF SERVICER AND MASTER SERVICER
|
Section
8.01
|
Events
of Default.
|
|
Section
8.02
|
Master
Servicer to Act; Appointment of Successor.
|
|
Section
8.03
|
Notification
to Certificateholders.
|
|
Section
8.04
|
Waiver
of Servicer Defaults and Master Servicer Defaults.
|
ARTICLE
IX
CONCERNING THE TRUSTEE AND SECURITIES ADMINISTRATOR
|
Section
9.01
|
Duties
of Trustee and Securities Administrator.
|
|
Section
9.02
|
Certain
Matters Affecting the Trustee and Securities Administrator.
|
|
Section
9.03
|
Trustee
and Securities Administrator not Liable for Certificates or Mortgage
Loans.
|
|
Section
9.04
|
Trustee
and Securities Administrator May Own Certificates.
|
|
Section
9.05
|
Fees
and Expenses of Trustee and Securities Administrator.
|
|
Section
9.06
|
Eligibility
Requirements for Trustee and Securities Administrator.
|
|
Section
9.07
|
Resignation
and Removal of Trustee and Securities Administrator.
|
|
Section
9.08
|
Successor
Trustee or Securities Administrator.
|
|
Section
9.09
|
Merger
or Consolidation of Trustee or Securities Administrator.
|
|
Section
9.10
|
Appointment
of Co-Trustee or Separate Trustee.
|
|
Section
9.11
|
Appointment
of Office or Agency.
|
|
Section
9.12
|
Representations
and Warranties.
|
|
Section
9.13
|
Tax
Matters.
|
ARTICLE
X
TERMINATION
|
Section
10.01
|
Termination
upon Liquidation or Repurchase of all Mortgage Loans.
|
|
Section
10.02
|
Final
Distribution on the Certificates.
|
|
Section
10.03
|
Additional
Termination Requirements.
|
ARTICLE
XI
MISCELLANEOUS PROVISIONS
|
Section
11.01
|
Amendment.
|
|
Section
11.02
|
Recordation
of Agreement; Counterparts.
|
|
Section
11.03
|
Governing
Law.
|
|
Section
11.04
|
Intention
of Parties.
|
|
Section
11.05
|
Notices.
|
|
Section
11.06
|
Severability
of Provisions.
|
|
Section
11.07
|
Assignment.
|
|
Section
11.08
|
Limitation
on Rights of Certificateholders.
|
|
Section
11.09
|
Certificates
Nonassessable and Fully Paid.
|
|
Section
11.10
|
Third
Party Beneficiaries.
|
|
Section
11.11
|
Intention
of the Parties and Interpretation.
|
Exhibits
| Exhibit A-1 |
Form
of Class [I][II]-A-[1][2][3][4]
Certificates
|
| Exhibit A-2 |
Form
of Class M-[1][2][3][4][5][6][7][8][9]
Certificates
|
| Exhibit A-3 |
Form
of Class B-[1][2] Certificates
|
| Exhibit A-4 |
Form
of Class X Certificates
|
| Exhibit A-5 |
Form
of Class P Certificates
|
| Exhibit A-6 |
Form
of Class R[-X] Certificates
|
| Exhibit B |
Mortgage
Loan Schedule
|
| Exhibit C |
Mortgage
Loan Purchase Agreement
|
| Exhibit D |
Form
of Transfer Affidavit
|
| Exhibit E |
Form
of Transferor Certificate
|
| Exhibit F |
Form
of Investment Letter (Non-Rule
144A)
|
| Exhibit G |
Form
of Rule 144A Investment Letter
|
| Exhibit H |
Form
of Additional Disclosure
Notification
|
| Exhibit I |
DTC
Letter of Representations
|
| Exhibit J |
Schedule
of Mortgage Loans with Lost Notes
|
| Exhibit K |
Prepayment
Charge Schedule
|
| Exhibit L |
Relevant
Servicing Criteria
|
| Exhibit M |
Form
of Back-up Certification
|
| Exhibit N |
Reporting
Responsibility
|
| Exhibit O |
Appendix
E of the Standard & Poor's Glossary For File Format For LEVELS®
Version 5.7 Revised
|
| Exhibit P |
Basis
Risk Cap Agreement
|
| Exhibit Q |
Interest
Rate Swap Agreement
|
| Exhibit R |
Interest
Rate Cap Agreement
|
| Exhibit S |
Form
of Power of Attorney
|
| Exhibit T |
Assignment
Agreement
|
| Exhibit X-1 |
Form
of Schedule of Default Loan Data
|
| Exhibit X-2 |
Form
of Schedule of Realized
Losses/Gains
|
POOLING
AND SERVICING AGREEMENT, dated as of January 1, 2007, among NOMURA HOME EQUITY
LOAN, INC., a Delaware corporation, as depositor (the “Depositor”), NOMURA
CREDIT & CAPITAL, INC., a Delaware corporation, as seller (in such capacity,
the “Sponsor”), XXXXX FARGO BANK, NATIONAL ASSOCIATION, a national banking
association, as master servicer (the “Master Servicer”) and securities
administrator (the “Securities Administrator”), OCWEN LOAN SERVICNG, LLC, a
Delaware limited liability corporation, as a servicer (“Ocwen” or a “Servicer”),
EQUITY ONE, INC., a Delaware corporation, as a servicer (“Equity One” or a
“Servicer”), SELECT PORTFOLIO SERVICING, INC., a Utah corporation, as a servicer
(“SPS” or a “Servicer”) and HSBC BANK, USA, NATIONAL ASSOCIATION, a national
banking association, not in its individual capacity, but solely as trustee
(the
“Trustee”).
PRELIMINARY
STATEMENT
The
Depositor is the owner of the Trust Fund that is hereby conveyed to the Trustee
in return for the Certificates.
REMIC
I
As
provided herein, the Securities Administrator will make an election to treat
the
segregated pool of assets consisting of the Trust Fund (exclusive of the Basis
Risk Cap Agreement, the Basis Risk Shortfall Reserve Fund and, for the avoidance
of doubt, the Supplemental Interest Trust, the Swap Agreement and the Interest
Rate Cap Agreement) as a REMIC for federal income tax purposes, and such
segregated pool of assets will be designated as “REMIC I”. The Class R-I
Interest will represent the sole class of “residual interests” in REMIC I for
purposes of the REMIC Provisions.
The
following table irrevocably sets forth the designation, the Uncertificated
REMIC
I Pass-Through Rate, the initial Uncertificated Principal Balance, and for
purposes of satisfying Treasury regulation Section 1.860G-1(a)(4)(iii), the
“latest possible maturity date” for each of the REMIC I Regular Interests. None
of the REMIC I Regular Interests will be certificated.
|
Designation
|
Uncertificated
REMIC I
Pass-Through
Rate
|
Initial
Certificate
Principal
Balance
|
Assumed
Final
Maturity
Date(1)
|
||||
|
I
|
(2)
|
$
|
194,790,228.95
|
January
25, 2037
|
|||
|
I-1-A
|
(2)
|
$
|
15,655,500.00
|
January
25, 2037
|
|||
|
I-1-B
|
(2)
|
$
|
15,655,500.00
|
January
25, 2037
|
|||
|
I-2-A
|
(2)
|
$
|
15,519,500.00
|
January
25, 2037
|
|||
|
I-2-B
|
(2)
|
$
|
15,519,500.00
|
January
25, 2037
|
|||
|
I-3-A
|
(2)
|
$
|
15,266,000.00
|
January
25, 2037
|
|||
|
I-3-B
|
(2)
|
$
|
15,266,000.00
|
January
25, 2037
|
|||
|
I-4-A
|
(2)
|
$
|
14,983,500.00
|
January
25, 2037
|
|||
|
I-4-B
|
(2)
|
$
|
14,983,500.00
|
January
25, 2037
|
|||
|
I-5-A
|
(2)
|
$
|
14,398,500.00
|
January
25, 2037
|
|||
|
I-5-B
|
(2)
|
$
|
14,398,500.00
|
January
25, 2037
|
|||
|
I-6-A
|
(2)
|
$
|
13,781,500.00
|
January
25, 2037
|
|||
|
I-6-B
|
(2)
|
$
|
13,781,500.00
|
January
25, 2037
|
|||
|
I-7-A
|
(2)
|
$
|
13,167,500.00
|
January
25, 2037
|
|||
|
I-7-B
|
(2)
|
$
|
13,167,500.00
|
January
25, 2037
|
|||
|
I-8-A
|
(2)
|
$
|
12,599,500.00
|
January
25, 2037
|
|||
|
I-8-B
|
(2)
|
$
|
12,599,500.00
|
January
25, 2037
|
|||
|
I-9-A
|
(2)
|
$
|
12,022,500.00
|
January
25, 2037
|
|||
|
I-9-B
|
(2)
|
$
|
12,022,500.00
|
January
25, 2037
|
|||
|
I-10-A
|
(2)
|
$
|
11,736,000.00
|
January
25, 2037
|
|||
|
I-10-B
|
(2)
|
$
|
11,736,000.00
|
January
25, 2037
|
|||
|
I-11-A
|
(2)
|
$
|
12,435,500.00
|
January
25, 2037
|
|||
|
I-11-B
|
(2)
|
$
|
12,435,500.00
|
January
25, 2037
|
|||
|
I-12-A
|
(2)
|
$
|
27,387,000.00
|
January
25, 2037
|
|||
|
I-12-B
|
(2)
|
$
|
27,387,000.00
|
January
25, 2037
|
|||
|
I-13-A
|
(2)
|
$
|
45,886,000.00
|
January
25, 2037
|
|||
|
I-13-B
|
(2)
|
$
|
45,886,000.00
|
January
25, 2037
|
|||
|
I-14-A
|
(2)
|
$
|
14,757,500.00
|
January
25, 2037
|
|||
|
I-14-B
|
(2)
|
$
|
14,757,500.00
|
January
25, 2037
|
|||
|
I-15-A
|
(2)
|
$
|
8,324,000.00
|
January
25, 2037
|
|||
|
I-15-B
|
(2)
|
$
|
8,324,000.00
|
January
25, 2037
|
|||
|
I-16-A
|
(2)
|
$
|
40,097,500.00
|
January
25, 2037
|
|||
|
I-16-B
|
(2)
|
$
|
40,097,500.00
|
January
25, 2037
|
|||
|
I-17-A
|
(2)
|
$
|
9,322,500.00
|
January
25, 2037
|
|||
|
I-17-B
|
(2)
|
$
|
9,322,500.00
|
January
25, 2037
|
|||
|
I-18-A
|
(2)
|
$
|
3,730,500.00
|
January
25, 2037
|
|||
|
I-18-B
|
(2)
|
$
|
3,730,500.00
|
January
25, 2037
|
|||
|
I-19-A
|
(2)
|
$
|
3,368,500.00
|
January
25, 2037
|
|||
|
I-19-B
|
(2)
|
$
|
3,368,500.00
|
January
25, 2037
|
|||
|
I-20-A
|
(2)
|
$
|
3,097,500.00
|
January
25, 2037
|
|||
|
I-20-B
|
(2)
|
$
|
3,097,500.00
|
January
25, 2037
|
|||
|
I-21-A
|
(2)
|
$
|
2,672,500.00
|
January
25, 2037
|
|||
|
I-21-B
|
(2)
|
$
|
2,672,500.00
|
January
25, 2037
|
|||
|
I-22-A
|
(2)
|
$
|
2,604,000.00
|
January
25, 2037
|
|||
|
I-22-B
|
(2)
|
$
|
2,604,000.00
|
January
25, 2037
|
|||
|
I-23-A
|
(2)
|
$
|
2,492,500.00
|
January
25, 2037
|
|||
|
I-23-B
|
(2)
|
$
|
2,492,500.00
|
January
25, 2037
|
|||
|
I-24-A
|
(2)
|
$
|
4,382,000.00
|
January
25, 2037
|
|||
|
I-24-B
|
(2)
|
$
|
4,382,000.00
|
January
25, 2037
|
|||
|
I-25-A
|
(2)
|
$
|
4,960,000.00
|
January
25, 2037
|
|||
|
I-25-B
|
(2)
|
$
|
4,960,000.00
|
January
25, 2037
|
|||
|
I-26-A
|
(2)
|
$
|
2,563,000.00
|
January
25, 2037
|
|||
|
I-26-B
|
(2)
|
$
|
2,563,000.00
|
January
25, 2037
|
|||
|
I-27-A
|
(2)
|
$
|
1,997,500.00
|
January
25, 2037
|
|||
|
I-27-B
|
(2)
|
$
|
1,997,500.00
|
January
25, 2037
|
|||
|
I-28-A
|
(2)
|
$
|
3,184,000.00
|
January
25, 2037
|
|||
|
I-28-B
|
(2)
|
$
|
3,184,000.00
|
January
25, 2037
|
|||
|
I-29-A
|
(2)
|
$
|
2,146,000.00
|
January
25, 2037
|
|||
|
I-29-B
|
(2)
|
$
|
2,146,000.00
|
January
25, 2037
|
|||
|
I-30-A
|
(2)
|
$
|
1,273,000.00
|
January
25, 2037
|
|||
|
I-30-B
|
(2)
|
$
|
1,273,000.00
|
January
25, 2037
|
|||
|
I-31-A
|
(2)
|
$
|
1,224,000.00
|
January
25, 2037
|
|||
|
I-31-B
|
(2)
|
$
|
1,224,000.00
|
January
25, 2037
|
|||
|
I-32-A
|
(2)
|
$
|
1,177,000.00
|
January
25, 2037
|
|||
|
I-32-B
|
(2)
|
$
|
1,177,000.00
|
January
25, 2037
|
|||
|
I-33-A
|
(2)
|
$
|
1,132,000.00
|
January
25, 2037
|
|||
|
I-33-B
|
(2)
|
$
|
1,132,000.00
|
January
25, 2037
|
|||
|
I-34-A
|
(2)
|
$
|
1,088,500.00
|
January
25, 2037
|
|||
|
I-34-B
|
(2)
|
$
|
1,088,500.00
|
January
25, 2037
|
|||
|
I-35-A
|
(2)
|
$
|
1,047,000.00
|
January
25, 2037
|
|||
|
I-35-B
|
(2)
|
$
|
1,047,000.00
|
January
25, 2037
|
|||
|
I-36-A
|
(2)
|
$
|
1,006,500.00
|
January
25, 2037
|
|||
|
I-36-B
|
(2)
|
$
|
1,006,500.00
|
January
25, 2037
|
|||
|
I-37-A
|
(2)
|
$
|
968,500.00
|
January
25, 2037
|
|||
|
I-37-B
|
(2)
|
$
|
968,500.00
|
January
25, 2037
|
|||
|
I-38-A
|
(2)
|
$
|
931,000.00
|
January
25, 2037
|
|||
|
I-38-B
|
(2)
|
$
|
931,000.00
|
January
25, 2037
|
|||
|
I-39-A
|
(2)
|
$
|
895,500.00
|
January
25, 2037
|
|||
|
I-39-B
|
(2)
|
$
|
895,500.00
|
January
25, 2037
|
|||
|
I-40-A
|
(2)
|
$
|
868,000.00
|
January
25, 2037
|
|||
|
I-40-B
|
(2)
|
$
|
868,000.00
|
January
25, 2037
|
|||
|
I-41-A
|
(2)
|
$
|
828,000.00
|
January
25, 2037
|
|||
|
I-41-B
|
(2)
|
$
|
828,000.00
|
January
25, 2037
|
|||
|
I-42-A
|
(2)
|
$
|
796,500.00
|
January
25, 2037
|
|||
|
I-42-B
|
(2)
|
$
|
796,500.00
|
January
25, 2037
|
|||
|
I-43-A
|
(2)
|
$
|
777,500.00
|
January
25, 2037
|
|||
|
I-43-B
|
(2)
|
$
|
777,500.00
|
January
25, 2037
|
|||
|
I-44-A
|
(2)
|
$
|
736,000.00
|
January
25, 2037
|
|||
|
I-44-B
|
(2)
|
$
|
736,000.00
|
January
25, 2037
|
|||
|
I-45-A
|
(2)
|
$
|
708,000.00
|
January
25, 2037
|
|||
|
I-45-B
|
(2)
|
$
|
708,000.00
|
January
25, 2037
|
|||
|
I-46-A
|
(2)
|
$
|
704,500.00
|
January
25, 2037
|
|||
|
I-46-B
|
(2)
|
$
|
704,500.00
|
January
25, 2037
|
|||
|
I-47-A
|
(2)
|
$
|
684,500.00
|
January
25, 2037
|
|||
|
I-47-B
|
(2)
|
$
|
684,500.00
|
January
25, 2037
|
|||
|
I-48-A
|
(2)
|
$
|
630,500.00
|
January
25, 2037
|
|||
|
I-48-B
|
(2)
|
$
|
630,500.00
|
January
25, 2037
|
|||
|
I-49-A
|
(2)
|
$
|
673,000.00
|
January
25, 2037
|
|||
|
I-49-B
|
(2)
|
$
|
673,000.00
|
January
25, 2037
|
|||
|
I-50-A
|
(2)
|
$
|
597,500.00
|
January
25, 2037
|
|||
|
I-50-B
|
(2)
|
$
|
597,500.00
|
January
25, 2037
|
|||
|
I-51-A
|
(2)
|
$
|
574,000.00
|
January
25, 2037
|
|||
|
I-51-B
|
(2)
|
$
|
574,000.00
|
January
25, 2037
|
|||
|
I-52-A
|
(2)
|
$
|
651,000.00
|
January
25, 2037
|
|||
|
I-52-B
|
(2)
|
$
|
651,000.00
|
January
25, 2037
|
|||
|
I-53-A
|
(2)
|
$
|
534,500.00
|
January
25, 2037
|
|||
|
I-53-B
|
(2)
|
$
|
534,500.00
|
January
25, 2037
|
|||
|
I-54-A
|
(2)
|
$
|
12,874,500.00
|
January
25, 2037
|
|||
|
I-54-B
|
(2)
|
$
|
12,874,500.00
|
January
25, 2037
|
|||
|
P
|
(3)
|
$
|
100.00
|
January
25, 2037
|
|||
___________________
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the
Distribution Date in the month following the maturity date for the
Mortgage Loan with the latest maturity date has been designated as
the
“latest possible maturity date” for each REMIC I Regular
Interest.
|
|
(2)
|
Calculated
in accordance with the definition of “Uncertificated REMIC I Pass-Through
Rate” herein.
|
|
(3)
|
The
REMIC I Regular Interest LT-P will not be entitled to distributions
of
interest.
|
REMIC
II
As
provided herein, the Securities Administrator will make an election to treat
the
segregated pool of assets consisting of the REMIC I Regular Interests) for
federal income tax purposes, and such segregated pool of assets will be
designated as “REMIC II.” The Class R-II Interest will represent the sole class
of “residual interests” in REMIC II for purposes of the REMIC Provisions. The
following table irrevocably sets forth the designation, the Uncertificated
REMIC
II Pass-Through Rate, the Initial Uncertificated Principal Balance, and for
purposes of satisfying Treasury regulation Section 1.860G-1(a)(4)(iii), the
“latest possible maturity date” for each of the REMIC II Regular Interests. None
of the REMIC II Regular Interests will be certificated.
|
Designation
|
Initial
Uncertificated
Principal
Balance
|
Uncertificated
REMIC
II
Pass-Through
Rate
|
Assumed
Final Distribution Date(1)
|
|||
|
LT-AA
|
$912,015,664.37
|
(2)
|
January
25, 2037
|
|||
|
LT-IA1
|
$3,588,470.00
|
(2)
|
January
25, 2037
|
|||
|
LT-IIA1
|
$2,207,640.00
|
(2)
|
January
25, 2037
|
|||
|
LT-IIA2
|
$263,330.00
|
(2)
|
January
25, 2037
|
|||
|
LT-IIA3
|
$657,310.00
|
(2)
|
January
25, 2037
|
|||
|
LT-IIA4
|
$216,430.00
|
(2)
|
January
25, 2037
|
|||
|
LT-M1
|
$395,510.00
|
(2)
|
January
25, 2037
|
|||
|
LT-M2
|
$358,290.00
|
(2)
|
January
25, 2037
|
|||
|
LT-M3
|
$218,690.00
|
(2)
|
January
25, 2037
|
|||
|
LT-M4
|
$195,430.00
|
(2)
|
January
25, 2037
|
|||
|
LT-M5
|
$176,810.00
|
(2)
|
January
25, 2037
|
|||
|
LT-M6
|
$158,200.00
|
(2)
|
January
25, 2037
|
|||
|
LT-M7
|
$144,240.00
|
(2)
|
January
25, 2037
|
|||
|
LT-M8
|
$134,940.00
|
(2)
|
January
25, 2037
|
|||
|
LT-M9
|
$111,670.00
|
(2)
|
January
25, 2037
|
|||
|
LT-B1
|
$130,280.00
|
(2)
|
January
25, 2037
|
|||
|
LT-ZZ
|
$9,655,324.58
|
(2)
|
January
25, 2037
|
|||
|
LT-IO
|
(4)
|
(2)
|
January
25, 0000
|
|||
|
XX-X
|
$100.00
|
(3)
|
January
25, 2037
|
___________________
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the Distribution Date in the month following the maturity date for
the
Mortgage Loan with the latest maturity date has been designated as
the
“latest possible maturity date” for each REMIC II Regular
Interest.
|
|
(2)
|
Calculated
in accordance with the definition of “Uncertificated REMIC II Pass-Through
Rate” herein.
|
|
(3)
|
The
REMIC II Regular Interest LT-P will not be entitled to distributions
of
interest.
|
|
(4)
|
REMIC
II Regular Interest LT-IO will not have an Uncertificated Principal
Balance, but will accrue interest on its Uncertificated Notional
Amount,
as defined herein.
|
REMIC
III
As
provided herein, the Securities Administrator will make an election to treat
the
segregated pool of assets consisting of the REMIC II Regular Interests as a
REMIC for federal income tax purposes, and such segregated pool of assets will
be designated as “REMIC III”. The Class R-III Interest will represent the sole
class of “residual interests” in REMIC III for purposes of the REMIC Provisions.
The following table irrevocably sets forth the Class designation, Pass-Through
Rate and Initial Certificate Principal Balance for each Class of Certificates
that represents one or more of the “regular interests” in REMIC III created
hereunder:
|
Class
Designation
|
Initial
Certificate
Principal
Balance
|
Pass-Through
Rate
|
Assumed
Final Distribution
Date(1)
|
||||
|
Class
I-A-1
|
$358,847,000.00
|
Class
I-A-1 Pass Through Rate
|
January
25, 2037
|
||||
|
Class
II-A-1
|
$220,764,000.00
|
Class
II-A-1 Pass Through Rate
|
January
25, 2037
|
||||
|
Class
II-A-2
|
$26,333,000.00
|
Class
II-A-2 Pass Through Rate
|
January
25, 2037
|
||||
|
Class
II-A-3
|
$65,731,000.00
|
Class
II-A-3 Pass Through Rate
|
January
25, 2037
|
||||
|
Class
II-A-4
|
$21,643,000.00
|
Class
II-A-4 Pass Through Rate
|
January
25, 2037
|
||||
|
Class
M-1
|
$39,551,000.00
|
Class
M-1 Pass Through Rate
|
January
25, 2037
|
||||
|
Class
M-2
|
$35,829,000.00
|
Class
M-2 Pass Through Rate
|
January
25, 2037
|
||||
|
Class
M-3
|
$21,869,000.00
|
Class
M-3 Pass Through Rate
|
January
25, 2037
|
||||
|
Class
M-4
|
$19,543,000.00
|
Class
M-4 Pass Through Rate
|
January
25, 2037
|
||||
|
Class
M-5
|
$17,681,000.00
|
Class
M-5 Pass Through Rate
|
January
25, 2037
|
||||
|
Class
M-6
|
$15,820,000.00
|
Class
M-6 Pass Through Rate
|
January
25, 2037
|
||||
|
Class
M-7
|
$14,424,000.00
|
Class
M-7 Pass-Through Rate
|
January
25, 2037
|
||||
|
Class
M-8
|
$13,494,000.00
|
Class
M-8 Pass Through Rate
|
January
25, 2037
|
||||
|
Class
M-9
|
$11,167,000.00
|
Class
M-9 Pass Through Rate
|
January
25, 2037
|
||||
|
Class
B-1
|
$13,028,000.00
|
Class
B-1 Pass Through Rate
|
January
25, 2037
|
||||
|
Class
X Interest(2)
|
$34,904,228.95
|
Class
X Pass Through Rate
|
January
25, 2037
|
||||
|
Class
P Interest
|
$ |
100.00
|
N/A(3)
|
January
25, 2037
|
|||
|
Class
IO Interest
|
(4)
|
(5)
|
January
25, 2037
|
___________________
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the Distribution Date in the month following the maturity date for
the
Mortgage Loan with the latest maturity date has been designated as
the
“latest possible maturity date” for each Class of
Certificates.
|
|
(2)
|
The
Class X Interest will not accrue interest on its Certificate Principal
Balance, but will accrue interest at the Class X Pass-Through Rate
on the
Certificate Notional Balance of the Class X Interest outstanding
from time
to time which shall equal the aggregate of the Uncertificated Principal
Balances of the REMIC II Regular Interests (other than REMIC II Regular
Interest LT-P).
|
|
(3)
|
The
Class P Interest will not be entitled to distributions of
interest.
|
|
(4)
|
For
federal income tax purposes, the Class IO Interest will not have
a
Pass-Through Rate, but will be entitled to 100% of the amounts distributed
on REMIC II Regular Interest LT-IO.
|
|
(5)
|
For
federal income tax purposes, the Class IO Interest will not have
an
Uncertificated Principal Balance, but will have a notional amount
equal to
the Uncertificated Notional Amount of REMIC II Regular Interest
IO.
|
REMIC
IV
As
provided herein, the Securities Administrator will make an election to treat
the
segregated pool of assets consisting of the Class X Interest Interests as a
REMIC for federal income tax purposes, and such segregated pool of assets will
be designated as “REMIC IV”. The Class R-IV Interest will represent the sole
class of “residual interests” in REMIC IV for purposes of the REMIC Provisions.
The following table irrevocably sets forth the Class designation, Pass-Through
Rate and Initial Certificate Principal Balance for each Class of Certificates
that represents one or more of the “regular interests” in REMIC IV created
hereunder:
|
Class
Designation
|
Initial
Certificate
Principal
Balance
|
Pass-Through
Rate
|
Assumed
Final Distribution Date(1)
|
|||
|
Class
X
|
$
34,904,228.95
|
(2)
|
January
25, 2037
|
___________________
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the Distribution Date in the second month following the maturity
date for
the Mortgage Loan with the latest maturity date has been designated
as the
“latest possible maturity date” for the Class X
Certificates.
|
|
(2)
|
The
Class X Certificates will be entitled to 100% of amounts distributed
on
the Class X Interest.
|
REMIC
V
As
provided herein, the Securities Administrator will make an election to treat
the
segregated pool of assets consisting of the Class P Interest Interests as a
REMIC for federal income tax purposes, and such segregated pool of assets will
be designated as “REMIC V”. The Class R-V Interest will represent the sole class
of “residual interests” in REMIC V for purposes of the REMIC Provisions. The
following table irrevocably sets forth the Class designation, Pass-Through
Rate
and Initial Certificate Principal Balance for each Class of Certificates that
represents one or more of the “regular interests” in REMIC V created
hereunder:
|
Class
Designation
|
Initial
Certificate
Principal
Balance
|
Pass-Through
Rate
|
Assumed
Final Distribution Date(1)
|
|||
|
Class
P
|
$
100.00
|
(2)
|
January
25, 2037
|
___________________
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the Distribution Date in the second month following the maturity
date for
the Mortgage Loan with the latest maturity date has been designated
as the
“latest possible maturity date” for the Class P
Certificates.
|
|
(2)
|
The
Class P Certificates will be entitled to 100% of amounts distributed
on
the Class P Interest.
|
REMIC
VI
As
provided herein, the Securities Administrator will make an election to treat
the
segregated pool of assets consisting of the Class IO Interest as a REMIC for
federal income tax purposes, and such segregated pool of assets will be
designated as “REMIC VI”. The Class R-VI interest will represent the sole class
of “residual interests” in REMIC VI for purposes of the REMIC Provisions. The
following table irrevocably sets forth the Class designation, Pass-Through
Rate
and Initial Certificate Principal Balance for each Class of Certificates that
represents one or more of the “regular interests” in REMIC VI created
hereunder:
|
Class
Designation
|
Initial
Certificate
Notional
Balance
|
Pass-Through
Rate
|
Assumed
Final Distribution Date(1)
|
|||
|
Swap-IO
|
(2)
|
(3)
|
January
25, 2037
|
___________________
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the Distribution Date in the second month following the maturity
date for
the Mortgage Loan with the latest maturity date has been designated
as the
“latest possible maturity date” for REMIC VI Regular Interest
Swap-IO.
|
|
(2)
|
REMIC
VI Regular Interest Swap-IO will have not a Certificate Notional
Balance
but will be entitled to 100% of amounts distributed on the Class
IO
Interest.
|
|
(3)
|
REMIC
VI Regular Interest Swap-IO will be entitled to 100% of amounts
distributed on the Class IO Interest.
|
In
consideration of the mutual agreements herein contained, the Depositor, Ocwen,
Equity One, SPS, the Master Servicer, the Securities Administrator, the Sponsor
and the Trustee agree as follows:
ARTICLE
I
DEFINITIONS
Section
1.01 Defined
Terms.
In
addition to those terms defined in Section 1.02, whenever used in this
Agreement, the following words and phrases, unless the context otherwise
requires, shall have the following meanings:
Accepted
Master Servicing Practices:
With
respect to any Mortgage Loan, as applicable, either (x) those customary mortgage
master servicing practices of prudent mortgage servicing institutions that
master service mortgage loans of the same type and quality as such Mortgage
Loan
in the jurisdiction where the related Mortgaged Property is located, to the
extent applicable to the Master Servicer (except in its capacity as successor
to
a Servicer), or (y) as provided in Section 3.01 hereof, but in no event
below the standard set forth in clause (x).
Accepted
Servicing Practices:
As
defined in Section 3.01.
Account:
Either
the Distribution Account or a Custodial Account.
Accrual
Period:
With
respect to the Senior Certificates and the Subordinate Certificates and any
Distribution Date, the period commencing on the immediately preceding
Distribution Date (or with respect to the first Accrual Period, the Closing
Date) and ending on the day immediately preceding the related Distribution
Date.
With respect to the Class X Certificates and any Distribution Date, the calendar
month immediately preceding such Distribution Date. All calculations of interest
on the Senior Certificates and Subordinate Certificates will be based on a
360-day year and the actual number of days elapsed in the related Accrual
Period. All calculations of interest on the Class X Certificates, REMIC I
Regular Interests and REMIC II Regular Interests will be based on a 360-day
year
consisting of twelve 30-day months.
Additional
Disclosure Notification:
Has the
meaning set forth in Section 5.14(a) of this Agreement.
Additional
Form 10-D Disclosure:
Has the
meaning set forth in Section 5.14(a) of this Agreement.
Additional
Form 10-K Disclosure:
Has the
meaning set forth in Section 5.14(e) of this Agreement.
Adjustment
Date:
With
respect to each adjustable rate Mortgage Loan, the first day of the month in
which the Mortgage Rate of such Mortgage Loan changes pursuant to the related
Mortgage Note. The first Adjustment Date following the Cut-Off Date as to each
adjustable rate Mortgage Loan is set forth in the Loan Schedule.
Advance:
An
advance of delinquent payments of principal or interest in respect of a Mortgage
Loan required to be made by the related Servicer or by the Master Servicer
pursuant to Section 5.01 of this Agreement or pursuant to the Servicing
Agreement.
Advance
Facility:
As
defined in Section 5.01(b)(i).
Advance
Facility Notice:
As
defined in Section 5.01(b)(ii).
Advance
Financing Person:
As
defined in Section 5.01(b)(i).
Advance
Reimbursement Amount:
As
defined in Section 5.01(b)(ii).
Affected
Party:
As
defined in the Swap Agreement.
Affiliate:
With
respect to any Person, (i) any other Person who, directly or indirectly, is
in
control of, controlled by or under common control with, such Person or (ii)
any
other Person who is a director, officer or employee (a) of such Person, (b)
of
any subsidiary or parent company of such Person or (c) of any Person described
in clause (i) above. For the purpose of this definition, control of a Person
shall mean the power, direct or indirect, (x) to vote more than 50% of the
securities having ordinary voting power for the election of directors or
managers of such Person or (y) to direct or cause the direction of the
management and policies of such Person whether by contract or
otherwise.
Aggregate
Loan Balance: With respect to the Mortgage Loans and any Distribution Date,
the
aggregate of the Stated Principal Balances of the Mortgage Loans as of the
last
day of the related Due Period.
Aggregate
Loan Group Balance:
With
respect to either Loan Group I or Loan Group II and any Distribution Date,
the
aggregate of the Stated Principal Balances of the Mortgage Loans in the related
Loan Group as of the last day of the related Due Period.
Agreement:
This
Pooling and Servicing Agreement and any and all amendments or supplements hereto
made in accordance with the terms herein.
Amounts
Held for Future Distribution:
As to
any Distribution Date, the aggregate amount held in a Servicer’s Custodial
Account at the close of business on the immediately preceding Determination
Date
on account of (i) all Scheduled Payments or portions thereof received in respect
of the related Mortgage Loans due after the related Due Period and (ii)
Principal Prepayments and Liquidation Proceeds received in respect of the
related Mortgage Loans after the last day of the related Prepayment
Period.
Applied
Loss Amount:
With
respect to the Senior Certificates and the Subordinate Certificates and any
Distribution Date, the excess of the aggregate Certificate Principal Balance
of
the Senior Certificates and the Subordinate Certificates over the Aggregate
Loan
Balance of the Mortgage Loans after giving effect to all Realized Losses
incurred with respect to the Mortgage Loans during the related Due Period and
payments of principal to the Senior Certificates and Subordinate Certificates
on
such Distribution Date.
Appraised
Value:
With
respect to any Mortgage Loan originated in connection with a refinancing, the
appraised value of the Mortgaged Property based upon the appraisal made at
the
time of such refinancing or, with respect to any other Mortgage Loan, the lesser
of (x) the appraised value of the Mortgaged Property based upon the appraisal
made by a fee appraiser at the time of the origination of the Mortgage Loan,
and
(y) the sales price of the Mortgaged Property at the time of such
origination.
Assignment
Agreement:
Shall
mean the Assignment, Assumption and Recognition Agreement, dated as of January
31, 2007, among the Sponsor, the Depositor and Xxxxx Fargo, as servicer,
pursuant to which the Servicing Agreement was assigned to the Depositor, a
copy
of which is attached hereto as Exhibit T.
Assumed
Final Distribution Date:
The
Distribution Date in January 2037.
Authorized
Servicer Representative:
Any
Servicing Officer or other authorized representative of the Servicer involved
in, or responsible for, the administration and servicing of the Mortgage Loans
whose name and facsimile signature appear on a list of such authorized
representatives furnished to the Trustee and the Master Servicer by the Servicer
on the Closing Date, as such list may from time to time be amended.
Available
Distribution Amount:
The sum
of the Interest Remittance Amount and Principal Remittance Amount, exclusive
of
amounts set forth in Section 5.08.
Balloon
Mortgage Loan:
A
Mortgage Loan that provides for the payment of the unamortized principal balance
of such Mortgage Loan in a single payment, that is substantially greater than
the preceding monthly payment at the maturity of such Mortgage
Loan.
Balloon
Payment:
A
payment of the unamortized principal balance of a Mortgage Loan in a single
payment, that is substantially greater than the preceding Monthly Payment at
the
maturity of such Mortgage Loan.
Bankruptcy
Code:
Title
11 of the United States Code.
Basis
Risk Cap Agreement:
The
basis risk cap agreement, dated as of January 31, 2007, between the Basis Risk
Cap Provider and Supplemental Interest Trust Trustee, including any schedule,
confirmations, credit
support annex or other credit support document relating thereto, and attached
hereto as Exhibit P.
Basis
Risk Cap Credit Support Annex:
The
credit support annex, dated as of January 31, 2007, between the Supplemental
Interest Trust Trustee and the Basis
Risk
Cap Provider, which is annexed to and forms part of the Basis Risk Cap
Agreement.
Basis
Risk Cap Provider:
The cap
provider under the Basis Risk Cap Agreement. Initially, the Basis Risk Cap
Provider shall be HSBC Bank USA, National Association.
Basis
Risk Shortfall Reserve Fund:
The
segregated non-interest bearing trust account created and maintained by the
Securities Administrator pursuant to Section 5.11 hereof.
Basis
Risk Shortfall:
With
respect to any Class of Senior Certificates or Subordinate Certificates and
any
Distribution Date, the sum of (i) the excess, if any, of the related Current
Interest (calculated without regard to the Net Funds Cap) over the related
Current Interest (as it may have been limited by the Net Funds Cap) for the
applicable Distribution Date; (ii) any amount described in clause (i) remaining
unpaid from prior Distribution Dates; and (iii) interest on the amount in clause
(ii) for the related Accrual Period calculated on the basis of the lesser of
(x)
One-Month LIBOR plus the applicable Certificate Margin and (y) the Maximum
Interest Rate.
Book-Entry
Certificates:
Any of
the Certificates that shall be registered in the name of the Depository or
its
nominee, the ownership of which is reflected on the books of the Depository
or
on the books of a person maintaining an account with the Depository (directly,
as a “Depository Participant”, or indirectly, as an indirect participant in
accordance with the rules of the Depository and as described in
Section 6.06). As of the Closing Date, each Class of Senior Certificates
and Subordinate Certificates constitutes a Class of Book-Entry
Certificates.
Business
Day:
Any day
other than (i) a Saturday or a Sunday, or (ii) a day on which banking
institutions in the State of New York, the State of Delaware, the State of
Maryland, the State of Minnesota, the State of New Jersey, the State of Florida,
the city in which any Corporate Trust Office of the Securities Administrator
is
located or the States in which each Servicer’s servicing operations are located
are authorized or obligated by law or executive order to be closed.
Carryforward
Interest:
With
respect to any Class of Senior Certificates and any Class of Subordinate
Certificates and any Distribution Date, the sum of (i) the amount, if any,
by
which (x) the sum of (A) Current Interest for that Class of Certificates for
the
immediately preceding Distribution Date and (B) any unpaid Carryforward Interest
for such Class from previous Distribution Dates exceeds (y) the actual amount
distributed to such Class in respect of interest on the immediately preceding
Distribution Date and (ii) interest on such amount for the related Accrual
Period at the applicable Pass-Through Rate.
Certificate:
Any one
of the certificates of any Class executed and authenticated by the Securities
Administrator in substantially the forms attached hereto as Exhibits A-1 through
A-6.
Certificate
Margin:
With
respect to each Distribution Date on or prior to the first possible Optional
Termination Date with respect to the Mortgage Loans, the Certificate Margins
for
the Class I-A-1, Class II-A-1, Class II-A-2, Class II-A-3, Class II-A-4, Class
M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class
M-8, Class M-9 and Class B-1 Certificates are 0.150%, 0.080%, 0.140%, 0.190%,
0.280%, 0.310%, 0.320%, 0.340%, 0.420%, 0.450%, 0.500%, 1.750%, 2.250%, 2.250%
and 2.250%, respectively. With respect to each Distribution Date following
the
first possible Optional Termination Date, the Certificate Margins for the Class
I-A-1, Class II-A-1, Class II-A-2, Class II-A-3, Class II-A-4, Class M-1, Class
M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class
M-9
and and Class B-1 Certificates are 0.300%, 0.160%, 0.280%, 0.380%, 0.560%,
0.465%, 0.480%, 0.510%, 0.630%, 0.675%, 0.750%, 2.625%, 3.375%, 3.375% and
3.375%, respectively.
Certificate
Notional Balance:
With
respect to the Class X Certificates and any Distribution Date, the
Uncertificated Principal Balance of the REMIC II Regular Interests (other than
REMIC II Regular Interest LT-P) for such Distribution Date. As of the Closing
Date, the Certificate Notional Balance of the Class X Certificates is equal
to
$930,628,228.95.
Certificate
Owner:
With
respect to a Book-Entry Certificate, the Person that is the beneficial owner
of
such Book-Entry Certificate.
Certificate
Principal Balance:
As to
any Senior Certificate, Subordinate Certificate or Class P Certificate and
as of
any Distribution Date, the Initial Certificate Principal Balance of such
Certificate less (i) the sum of (a) all amounts distributed with respect to
such
Certificate in reduction of the Certificate Principal Balance thereof on
previous Distribution Dates pursuant to Section 5.04 and (b) with respect
to any Class of Subordinate Certificates, any reductions in the Certificate
Principal Balance of such Certificate deemed to have occurred in connection
with
the allocations of Realized Losses, if any, plus (ii) with respect to the
Subordinate Certificates, any Subsequent Recoveries added to the Certificate
Principal Balance of any such Certificate pursuant to Section 5.05(d), in
each case up to the amount of Applied Loss Amounts but only to the extent that
any such Applied Loss Amount has not been paid to any Class of Certificates
as a
Deferred Amount or previously increased due to other Subsequent Recoveries.
With
respect to the Class X Certificates and any date of determination, the excess,
if any, of (i) the then Aggregate Loan Balance over (ii) the then aggregate
Certificate Principal Balance of the Publicly Offered Certificates and the
Class
B-1 Certificates. References herein to the Certificate Principal Balance of
a
Class of Certificates shall mean the Certificate Principal Balances of all
Certificates in such Class.
Certificate
Register:
The
register maintained pursuant to Section 6.02.
Certificateholder
or Holder:
The
person in whose name a Certificate is registered in the Certificate Register
(initially, Cede & Co., as nominee for the Depository, in the case of any
Book-Entry Certificates).
Certification
Parties:
Has the
meaning set forth in Section 3.18 of this Agreement.
Certifying
Person:
Has the
meaning set forth in Section 3.18 of this Agreement.
Class:
All
Certificates bearing the same Class designation as set forth in
Section 6.01.
Class
I-A-1 Certificate:
Any
Certificate designated as a “Class I-A-1 Certificate” on the face thereof, in
the form of Exhibit A-1 hereto, representing the right to its Percentage
Interest of distributions provided for the Class I-A-1 Certificates as set
forth
herein and evidencing (i) a REMIC Regular Interest in REMIC III, (ii) the right
to receive the related Basis Risk Shortfall and (iii) the obligation to pay
any
Class IO Distribution Amount.
Class
I-A-1 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the lesser of
(i)
the sum of One-Month LIBOR for that Distribution Date plus the applicable
Certificate Margin and (ii) the Net Funds Cap.
Class
II-A-1 Certificate:
Any
Certificate designated as a “Class II-A-1 Certificate” on the face thereof, in
the form of Exhibit A-1 hereto, representing the right to its Percentage
Interest of distributions provided for the Class II-A-1 Certificates as set
forth herein and evidencing (i) a REMIC Regular Interest in REMIC III, (ii)
the
right to receive the related Basis Risk Shortfall and (iii) the obligation
to
pay any Class IO Distribution Amount.
Class
II-A-1 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the lesser of
(i)
the sum of One-Month LIBOR for that Distribution Date plus the applicable
Certificate Margin and (ii) the Net Funds Cap.
Class
II-A-2 Certificate:
Any
Certificate designated as a “Class II-A-2 Certificate” on the face thereof, in
the form of Exhibit A-1 hereto, representing the right to its Percentage
Interest of distributions provided for the Class II-A-2 Certificates as set
forth herein and evidencing (i) a REMIC Regular Interest in REMIC III, (ii)
the
right to receive the related Basis Risk Shortfall and (iii) the obligation
to
pay any Class IO Distribution Amount.
Class
II-A-2 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the lesser of
(i)
the sum of One-Month LIBOR for that Distribution Date plus the applicable
Certificate Margin and (ii) the Net Funds Cap.
Class
II-A-3 Certificate:
Any
Certificate designated as a “Class II-A-3 Certificate” on the face thereof, in
the form of Exhibit A-1 hereto, representing the right to its Percentage
Interest of distributions provided for the Class II-A-3 Certificates as set
forth herein and evidencing (i) a REMIC Regular Interest in REMIC III, (ii)
the
right to receive the related Basis Risk Shortfall and (iii) the obligation
to
pay any Class IO Distribution Amount.
Class
II-A-3 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the lesser of
(i)
the sum of One-Month LIBOR for that Distribution Date plus the applicable
Certificate Margin and (ii) the Net Funds Cap.
Class
II-A-4 Certificate:
Any
Certificate designated as a “Class II-A-4 Certificate” on the face thereof, in
the form of Exhibit A-1 hereto, representing the right to its Percentage
Interest of distributions provided for the Class II-A-4 Certificates as set
forth herein and evidencing (i) a REMIC Regular Interest in REMIC III, (ii)
the
right to receive the related Basis Risk Shortfall and (iii) the obligation
to
pay any Class IO Distribution Amount.
Class
II-A-4 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the lesser of
(i)
the sum of One-Month LIBOR for that Distribution Date plus the applicable
Certificate Margin and (ii) the Net Funds Cap.
Class
B-1 Certificate:
Any
Certificate designated as a “Class B-1 Certificate” on the face thereof, in the
form of Exhibit A-3 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class B-1 Certificates as set forth herein and
evidencing (i) a REMIC Regular Interest in REMIC III, (ii) the right to receive
the related Basis Risk Shortfall and (iii) the obligation to pay any Class
IO
Distribution Amount.
Class
B-1 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the lesser of
(i)
the sum of One-Month LIBOR for that Distribution Date plus the applicable
Certificate Margin and (ii) the Net Funds Cap.
Class
B-1 Principal Payment Amount:
With
respect to any Distribution Date on or after the Stepdown Date and as long
as a
Trigger Event is not in effect with respect to such Distribution Date, the
amount, if any, by which (x) the sum of (i) the Certificate Principal Balances
of the Senior Certificates and the Mezzanine Certificates, in each case, after
giving effect to payments on such Distribution Date and (ii) the Certificate
Principal Balance of the Class B-1 Certificates immediately prior to such
Distribution Date exceeds (y) the lesser of (A) the product of (i) 92.50% and
(ii) the Aggregate Loan Balance for such Distribution Date (after giving effect
to scheduled payments of principal due during the related Due Period to the
extent received or advanced, unscheduled collections of principal received
during the related Prepayment Period and after reduction for Realized Losses
on
the Mortgage Loans incurred during the related Due Period) and (B) the amount,
if any, by which (i) the Aggregate Loan Balance for such Distribution Date
(after giving effect to scheduled payments of principal due during the related
Due Period to the extent received or advanced, unscheduled collections of
principal received during the related Prepayment Period and after reduction
for
Realized Losses on the Mortgage Loans incurred during the related Due Period)
exceeds (ii) 0.50% of the Aggregate Loan Balance as of the Cut-off
Date.
Class
IO Distribution Amount:
As
defined in Section 5.12(g) hereof. For
purposes of clarity, the Class IO Distribution Amount for any Distribution
Date
shall equal the amount payable to the Supplemental Interest Trust on such
Distribution Date in excess of the amount payable on the Class IO Interest
on
such Distribution Date, all as further provided in Section 5.12(g)
hereof.
Class
IO Interest:
An
uncertificated interest in the Trust Fund held by the Trustee, evidencing a
REMIC Regular Interest in REMIC III for purposes of the REMIC
Provisions.
Class
M-1 Certificate:
Any
Certificate designated as a “Class M-1 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-1 Certificates as set forth herein and
(i) a REMIC Regular Interest in REMIC III, (ii) the right to receive the related
Basis Risk Shortfall and (iii) the obligation to pay any Class IO Distribution
Amount.
Class
M-1 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the lesser of
(i)
the sum of One-Month LIBOR for that Distribution Date plus the applicable
Certificate Margin and (ii) the Net Funds Cap.
Class
M-1 Principal Payment Amount:
With
respect to any Distribution Date on or after the Stepdown Date and as long
as a
Trigger Event is not in effect with respect to such Distribution Date, the
amount, if any, by which (x) the sum of (i) the Certificate Principal Balances
of the Senior Certificates, in each case, after giving effect to payments on
such Distribution Date and (ii) the Certificate Principal Balance of the Class
M-1 Certificates immediately prior to such Distribution Date exceeds (y) the
lesser of (A) the product of (i) 57.50% and (ii) the Aggregate Loan Balance
for
such Distribution Date (after giving effect to scheduled payments of principal
due during the related Due Period to the extent received or advanced,
unscheduled collections of principal received during the related Prepayment
Period and after reduction for Realized Losses on the Mortgage Loans incurred
during the related Due Period) and (B) the amount, if any, by which (i) the
Aggregate Loan Balance for such Distribution Date (after giving effect to
scheduled payments of principal due during the related Due Period to the extent
received or advanced, unscheduled collections of principal received during
the
related Prepayment Period and after reduction for Realized Losses on the
Mortgage Loans incurred during the related Due Period) exceeds (ii) 0.50% of
the
Aggregate Loan Balance as of the Cut-off Date.
Class
M-2 Certificate:
Any
Certificate designated as a “Class M-2 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-2 Certificates as set forth herein and
evidencing (i) a REMIC Regular Interest in REMIC III, (ii) the right to receive
the related Basis Risk Shortfall and (iii) the obligation to pay any Class
IO
Distribution Amount.
Class
M-2 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the lesser of
(i)
the sum of One-Month LIBOR for that Distribution Date plus the applicable
Certificate Margin and (ii) the Net Funds Cap.
Class
M-2 Principal Payment Amount:
With
respect to any Distribution Date on or after the Stepdown Date and as long
as a
Trigger Event is not in effect with respect to such Distribution Date, the
amount, if any, by which (x) the sum of (i) the Certificate Principal Balances
of the Senior Certificates and the Class M-1 Certificates, in each case, after
giving effect to payments on such Distribution Date and (ii) the Certificate
Principal Balance of the Class M-2 Certificates immediately prior to such
Distribution Date exceeds (y) the lesser of (A) the product of (i) 65.20% and
(ii) the Aggregate Loan Balance for such Distribution Date (after giving effect
to scheduled payments of principal due during the related Due Period to the
extent received or advanced, unscheduled collections of principal received
during the related Prepayment Period and after reduction for Realized Losses
on
the Mortgage Loans incurred during the related Due Period) and (B) the amount,
if any, by which (i) the Aggregate Loan Balance for such Distribution Date
(after giving effect to scheduled payments of principal due during the related
Due Period to the extent received or advanced, unscheduled collections of
principal received during the related Prepayment Period and after reduction
for
Realized Losses on the Mortgage Loans incurred during the related Due Period)
exceeds (ii) 0.50% of the Aggregate Loan Balance as of the Cut-off
Date.
Class
M-3 Certificate:
Any
Certificate designated as a “Class M-3 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-3 Certificates as set forth herein and
evidencing (i) a REMIC Regular Interest in REMIC III, (ii) the right to receive
the related Basis Risk Shortfall and (iii) the obligation to pay any Class
IO
Distribution Amount.
Class
M-3 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the lesser of
(i)
the sum of One-Month LIBOR for that Distribution Date plus the related
Certificate Margin and (ii) the Net Funds Cap.
Class
M-3 Principal Payment Amount:
With
respect to any Distribution Date on or after the Stepdown Date and as long
as a
Trigger Event is not in effect with respect to such Distribution Date, the
amount, if any, by which (x) the sum of (i) the Certificate Principal Balances
of the Senior Certificates, Class M-1 Certificates and Class M-2 Certificates,
in each case, after giving effect to payments on such Distribution Date and
(ii)
the Certificate Principal Balance of the Class M-3 Certificates immediately
prior to such Distribution Date exceeds (y) the lesser of (A) the product of
(i)
69.90% and (ii) the Aggregate Loan Balance for such Distribution Date (after
giving effect to scheduled payments of principal due during the related Due
Period to the extent received or advanced, unscheduled collections of principal
received during the related Prepayment Period and after reduction for Realized
Losses on the Mortgage Loans incurred during the related Due Period) and (B)
the
amount, if any, by which (i) the Aggregate Loan Balance for such Distribution
Date (after giving effect to scheduled payments of principal due during the
related Due Period to the extent received or advanced, unscheduled collections
of principal received during the related Prepayment Period and after reduction
for Realized Losses on the Mortgage Loans incurred during the related Due
Period) exceeds (ii) 0.50% of the Aggregate Loan Balance as of the Cut-off
Date.
Class
M-4 Certificate:
Any
Certificate designated as a “Class M-4 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-4 Certificates as set forth herein and
evidencing (i) a REMIC Regular Interest in REMIC III, (ii) the right to receive
the related Basis Risk Shortfall and (iii) the obligation to pay any Class
IO
Distribution Amount.
Class
M-4 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the lesser of
(i)
the sum of One-Month LIBOR for that Distribution Date plus the related
Certificate Margin and (ii) the Net Funds Cap.
Class
M-4 Principal Payment Amount:
With
respect to any Distribution Date on or after the Stepdown Date and as long
as a
Trigger Event is not in effect with respect to such Distribution Date, the
amount, if any, by which (x) the sum of (i) the Certificate Principal Balances
of the Senior Certificates, Class M-1, Class M-2 and Class M-3 Certificates,
in
each case, after giving effect to payments on such Distribution Date and (ii)
the Certificate Principal Balance of the Class M-4 Certificates immediately
prior to such Distribution Date exceeds (y) the lesser of (A) the product of
(i)
74.10% and (ii) the Aggregate Loan Balance for such Distribution Date (after
giving effect to scheduled payments of principal due during the related Due
Period to the extent received or advanced, unscheduled collections of principal
received during the related Prepayment Period and after reduction for Realized
Losses on the Mortgage Loans incurred during the related Due Period) and (B)
the
amount, if any, by which (i) the Aggregate Loan Balance for such Distribution
Date (after giving effect to scheduled payments of principal due during the
related Due Period to the extent received or advanced, unscheduled collections
of principal received during the related Prepayment Period and after reduction
for Realized Losses on the Mortgage Loans incurred during the related Due
Period) exceeds (ii) 0.50% of the Aggregate Loan Balance as of the Cut-off
Date.
Class
M-5 Certificate:
Any
Certificate designated as a “Class M-5 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-5 Certificates as set forth herein and
evidencing (i) a REMIC Regular Interest in REMIC III, (ii) the right to receive
the related Basis Risk Shortfall and (iii) the obligation to pay any Class
IO
Distribution Amount.
Class
M-5 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the lesser of
(i)
the sum of One-Month LIBOR for that Distribution Date plus the applicable
Certificate Margin and (ii) the Net Funds Cap.
Class
M-5 Principal Payment Amount:
With
respect to any Distribution Date on or after the Stepdown Date and as long
as a
Trigger Event is not in effect with respect to such Distribution Date, the
amount, if any, by which (x) the sum of (i) the Certificate Principal Balances
of the Senior Certificates, Class M-1, Class M-2, Class M-3 and Class M-4
Certificates, in each case, after giving effect to payments on such Distribution
Date and (ii) the Certificate Principal Balance of the Class M-5 Certificates
immediately prior to such Distribution Date exceeds (y) the lesser of (A) the
product of (i) 77.90% and (ii) the Aggregate Loan Balance for such Distribution
Date (after giving effect to scheduled payments of principal due during the
related Due Period to the extent received or advanced, unscheduled collections
of principal received during the related Prepayment Period and after reduction
for Realized Losses on the Mortgage Loans incurred during the related Due
Period) and (B) the amount, if any, by which (i) the Aggregate Loan Balance
for
such Distribution Date (after giving effect to scheduled payments of principal
due during the related Due Period to the extent received or advanced,
unscheduled collections of principal received during the related Prepayment
Period and after reduction for Realized Losses on the Mortgage Loans incurred
during the related Due Period) exceeds (ii) 0.50% of the Aggregate Loan Balance
as of the Cut-off Date.
Class
M-6 Certificate:
Any
Certificate designated as a “Class M-6 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-6 Certificates as set forth herein and
evidencing (i) a REMIC Regular Interest in REMIC III, (ii) the right to receive
the related Basis Risk Shortfall and (iii) the obligation to pay any Class
IO
Distribution Amount.
Class
M-6 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the lesser of
(i)
the sum of One-Month LIBOR for that Distribution Date plus the applicable
Certificate Margin and (ii) the Net Funds Cap.
Class
M-6 Principal Payment Amount:
With
respect to any Distribution Date on or after the Stepdown Date and as long
as a
Trigger Event is not in effect with respect to such Distribution Date, the
amount, if any, by which (x) the sum of (i) the Certificate Principal Balances
of the Senior Certificates, Class X-0, Xxxxx X-0, Class M-3, Class M-4 and
Class
M-5 Certificates, in each case, after giving effect to payments on such
Distribution Date and (ii) the Certificate Principal Balance of the Class M-6
Certificates immediately prior to such Distribution Date exceeds (y) the lesser
of (A) the product of (i) 81.30% and (ii) the Aggregate Loan Balance for such
Distribution Date (after giving effect to scheduled payments of principal due
during the related Due Period to the extent received or advanced, unscheduled
collections of principal received during the related Prepayment Period and
after
reduction for Realized Losses on the Mortgage Loans incurred during the related
Due Period) and (B) the amount, if any, by which (i) the Aggregate Loan Balance
for such Distribution Date (after giving effect to scheduled payments of
principal due during the related Due Period to the extent received or advanced,
unscheduled collections of principal received during the related Prepayment
Period and after reduction for Realized Losses on the Mortgage Loans incurred
during the related Due Period) exceeds (ii) 0.50% of the Aggregate Loan Balance
as of the Cut-off Date.
Class
M-7 Certificate:
Any
Certificate designated as a “Class M-7 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-7 Certificates as set forth herein and
evidencing (i) a REMIC Regular Interest in REMIC III, (ii) the right to receive
the related Basis Risk Shortfall and (iii) the obligation to pay any Class
IO
Distribution Amount.
Class
M-7 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the lesser of
(i)
the sum of One-Month LIBOR for that Distribution Date plus the applicable
Certificate Margin and (ii) the Net Funds Cap.
Class
M-7 Principal Payment Amount:
With
respect to any Distribution Date on or after the Stepdown Date and as long
as a
Trigger Event is not in effect with respect to such Distribution Date, the
amount, if any, by which (x) the sum of (i) the Certificate Principal Balances
of the Senior Certificates, Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class
M-5 and Class M-6 Certificates, in each case, after giving effect to payments
on
such Distribution Date and (ii) the Certificate Principal Balance of the Class
M-7 Certificates immediately prior to such Distribution Date exceeds (y) the
lesser of (A) the product of (i) 84.40% and (ii) the Aggregate Loan Balance
for
such Distribution Date (after giving effect to scheduled payments of principal
due during the related Due Period to the extent received or advanced,
unscheduled collections of principal received during the related Prepayment
Period and after reduction for Realized Losses on the Mortgage Loans incurred
during the related Due Period) and (B) the amount, if any, by which (i) the
Aggregate Loan Balance for such Distribution Date (after giving effect to
scheduled payments of principal due during the related Due Period to the extent
received or advanced, unscheduled collections of principal received during
the
related Prepayment Period and after reduction for Realized Losses on the
Mortgage Loans incurred during the related Due Period) exceeds (ii) 0.50% of
the
Aggregate Loan Balance as of the Cut-off Date.
Class
M-8 Certificate:
Any
Certificate designated as a “Class M-8 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-8 Certificates as set forth herein and
evidencing (i) a REMIC Regular Interest in REMIC III, (ii) the right to receive
the related Basis Risk Shortfall and (iii) the obligation to pay any Class
IO
Distribution Amount.
Class
M-8 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the lesser of
(i)
the sum of One-Month LIBOR for that Distribution Date plus the applicable
Certificate Margin and (ii) the Net Funds Cap.
Class
M-8 Principal Payment Amount:
With
respect to any Distribution Date on or after the Stepdown Date and as long
as a
Trigger Event is not in effect with respect to such Distribution Date, the
amount, if any, by which (x) the sum of (i) the Certificate Principal Balances
of the Senior Certificates, Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class
M-5, Class M-6 and Class M-7 Certificates, in each case, after giving effect
to
payments on such Distribution Date and (ii) the Certificate Principal Balance
of
the Class M-8 Certificates immediately prior to such Distribution Date exceeds
(y) the lesser of (A) the product of (i) 87.30% and (ii) the Aggregate Loan
Balance for such Distribution Date (after giving effect to scheduled payments
of
principal due during the related Due Period to the extent received or advanced,
unscheduled collections of principal received during the related Prepayment
Period and after reduction for Realized Losses on the Mortgage Loans incurred
during the related Due Period) and (B) the amount, if any, by which (i) the
Aggregate Loan Balance for such Distribution Date (after giving effect to
scheduled payments of principal due during the related Due Period to the extent
received or advanced, unscheduled collections of principal received during
the
related Prepayment Period and after reduction for Realized Losses on the
Mortgage Loans incurred during the related Due Period) exceeds (ii) 0.50% of
the
Aggregate Loan Balance as of the Cut-off Date.
Class
M-9 Certificate:
Any
Certificate designated as a “Class M-9 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-9 Certificates as set forth herein and
evidencing (i) a REMIC Regular Interest in REMIC III, (ii) the right to receive
the related Basis Risk Shortfall and (iii) the obligation to pay any Class
IO
Distribution Amount.
Class
M-9 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the lesser of
(i)
the sum of One-Month LIBOR for that Distribution Date plus the applicable
Certificate Margin and (ii) the Net Funds Cap.
Class
M-9 Principal Payment Amount:
With
respect to any Distribution Date on or after the Stepdown Date and as long
as a
Trigger Event is not in effect with respect to such Distribution Date, the
amount, if any, by which (x) the sum of (i) the Certificate Principal Balances
of the Senior Certificates, Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class
M-5, Class M-6, Class M-7 and Class M-8 Certificates, in each case, after giving
effect to payments on such Distribution Date and (ii) the Certificate Principal
Balance of the Class M-9 Certificates immediately prior to such Distribution
Date exceeds (y) the lesser of (A) the product of (i) 89.70% and (ii) the
Aggregate Loan Balance for such Distribution Date (after giving effect to
scheduled payments of principal due during the related Due Period to the extent
received or advanced, unscheduled collections of principal received during
the
related Prepayment Period and after reduction for Realized Losses on the
Mortgage Loans incurred during the related Due Period) and (B) the amount,
if
any, by which (i) the Aggregate Loan Balance for such Distribution Date (after
giving effect to scheduled payments of principal due during the related Due
Period to the extent received or advanced, unscheduled collections of principal
received during the related Prepayment Period and after reduction for Realized
Losses on the Mortgage Loans incurred during the related Due Period) exceeds
(ii) 0.50% of the Aggregate Loan Balance as of the Cut-off Date.
Class
P Certificate:
Any
Certificate designated as a “Class P Certificate” on the face thereof, in the
form of Exhibit A-5 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class P Certificates as set forth herein and
evidencing a
REMIC
Regular Interest in REMIC V.
Class
P Certificate Account:
The
Eligible Account established and maintained by the Securities Administrator
pursuant to Section 5.09.
Class
P Interest:
An
uncertificated interest in the Trust Fund held by the Trustee on behalf of
the
Holders of the Class P Certificates, evidencing a Regular Interest in REMIC
III
for purposes of the REMIC Provisions.
Class
R Certificate:
Any
Certificate designated as a “Class R” Certificate on the face thereof in the
form of Exhibit A-6 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class R Certificates as set forth herein and
evidencing the Class R-I Interest, Class R-II Interest and Class R-III
Interest.
Class
R-X Certificate:
The
Class R-X Certificate executed by the Trustee, and authenticated and delivered
by the Certificate Registrar, substantially in the form annexed hereto as
Exhibit A-6 and evidencing the ownership of the Class R-IV Interest, the Class
R-V Interest and the Class R-VI Interest.
Class
R-I Interest:
The
uncertificated residual interest in REMIC I.
Class
R-II Interest:
The
uncertificated residual interest in REMIC II.
Class
R-III Interest:
The
uncertificated residual interest in REMIC III.
Class
R-IV Interest:
The
uncertificated residual interest in REMIC IV.
Class
R-V Interest:
The
uncertificated residual interest in REMIC V.
Class
R-VI Interest:
The
uncertificated residual interest in REMIC VI.
Class
X Certificate:
Any
Certificate designated as a “Class X Certificate” on the face thereof, in the
form of Exhibit A-4 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class X Certificates as set forth herein and
evidencing (i) a REMIC Regular Interest in REMIC IV, (ii) the obligation to
pay
Basis Risk Shortfall and (iii) the obligation to pay any Class IO Distribution
Amount.
Class
X Distribution Amount:
With
respect to any Distribution Date and the Class X Certificates, the sum of (i)
the Excess Basis Risk Cap Payment, (ii) the Current Interest and Carryforward
Interest and (iii) any Overcollateralization Release Amount for such
Distribution Date remaining after payments pursuant to items 1 through 23 of
Section 5.04(a)(iii); provided, however that on and after the Distribution
Date on which the Certificate Principal Balances of the Senior Certificates
and
the Subordinate Certificates have been reduced to zero, the Class X Distribution
Amount shall include the Overcollateralization Amount.
Class
X Interest:
An
uncertificated interest in the Trust Fund held by the Trustee on behalf of
the
Holders of the Class X Certificates, evidencing a Regular Interest in REMIC
III
for purposes of the REMIC Provisions.
Class
X Pass-Through Rate:
On any
Distribution Date, a per annum rate equal to the percentage equivalent of a
fraction, the numerator of which is the sum of the amounts calculated pursuant
to clauses (A) through (Q) below, and the denominator of which is the aggregate
of the Uncertificated Principal Balances of REMIC II Regular Interest LT-AA,
REMIC II Regular Interest LT-IA1, REMIC II Regular Interest LT-IIA1, REMIC
II
Regular Interest LT-IIA2, REMIC II Regular Interest LT-IIA3, REMIC II Regular
Interest LT-IIA4, REMIC II Regular Interest LT-M1, REMIC II Regular Interest
LT-M2, REMIC II Regular Interest LT-M3, REMIC II Regular Interest LT-M4, REMIC
II Regular Interest LT-M5, REMIC II Regular Interest LT-M6, REMIC II Regular
Interest LT-M7, REMIC II Regular Interest LT-M8, REMIC II Regular Interest
LT-M9, REMIC II Regular Interest LT-B1 and REMIC II Regular Interest LT-ZZ.
For
purposes of calculating the Pass-Through Rate for the Class X Interest, the
numerator is equal to the sum of the following components:
(A) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-AA
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-AA;
(B) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-IA1
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-IA1;
(C) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-IIA1,
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-IIA1;
(D) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-IIA2
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-IIA2;
(E) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-IIA3,
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-IIA3;
(F) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-IIA4,
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-IIA4;
(G) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M1
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M1;
(H) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M2
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M2;
(I) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M3
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M3;
(J) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M4
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M4;
(K) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M5
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M5;
(L) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M6
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M6;
(M) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M7
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M7;
(N) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M8
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M8;
(O) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M9
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M9;
(P) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-B1
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-B1; and
(Q) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-ZZ
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-ZZ.
The
Class
X Certificates will be entitled to 100% of amounts distributed on the Class
X
Interest.
Cleanup
Call:
As
defined in Section 10.01.
Closing
Date:
January
31, 2007.
Code:
The
Internal Revenue Code of 1986, including any successor or amendatory
provisions.
Combined
Loan-to-Value Ratio:
With
respect to any Mortgage Loan as of any Determination Date, the ratio on such
Determination Date of the Stated Principal Balance of the Mortgage Loan and
any
other mortgage loan which is secured by a lien on the related Mortgaged Property
to the Appraised Value of the Mortgaged Property.
Commission:
Shall
mean the United States Securities and Exchange Commission.
Compensating
Interest:
With
respect to any Distribution Date and and (i) Ocwen, an amount equal to the
lesser of (a) the aggregate amount of the Interest Shortfalls resulting from
voluntary Principal Prepayments in full on the Mortgage Loans serviced by Ocwen
for such Distribution date and received during the portion of the Prepayment
Period occurring from the 16th day of the month prior to the month in which
the
related Distribution Date occurs and ending on the last day of such month,
and
(b) the aggregate Servicing Fee due Ocwen on the Mortgage Loans serviced by
Ocwen for such Distribution Date, (ii) Equity One, an amount equal to the lesser
of (a) the aggregate amount of Interest Shortfalls on the Equity One Mortgage
Loans for such Distribution Date pursuant to items (a) and (b) of the definition
of Interest Shortfalls in this Agreement and (b) the aggregate Servicing Fees
due Equity One for such Distribution Date, (iii) Xxxxx Fargo Bank, N.A. in
its
capacity as a Servicer, the aggregate amount of Interest Shortfalls resulting
from Principal Prepayments in full on the Mortgage Loans serviced by Xxxxx
Fargo
Bank, N.A. for such Distribution Date and received during the related Prepayment
Period, (iv) SPS, an amount equal to the lesser of (a) the aggregate amount
of
the Interest Shortfalls resulting from Principal Prepayments in full on the
Mortgage Loans serviced by SPS for such Distribution Date and received during
the portion of the Prepayment Period occurring from the 15th day of the month
prior to the month in which the related Distribution Date occurs and ending
on
the last day of such month, and (b) the aggregate Servicing Fee due SPS on
the
Mortgage Loans serviced by SPS for such Distribution Date, or (v) the Master
Servicer, will be an amount equal to any Interest Shortfalls required to be
funded by the related servicer pursuant to clauses (i), (ii), (iii) or (iv)
above and not funded, up to the aggregate Master Servicing Fee (exclusive of
the
portion of such fee payable to the Master Servicer in its capacity as Credit
Risk Manager) for such Distribution Date.
Corporate
Trust Office:
The
principal corporate trust office of the Trustee which office at the date of
the
execution of this instrument is located at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx
00000, Attention: Nomura Home Equity Loan, Inc., 2007-2 or at such other address
as the Trustee may designate from time to time by notice to the
Certificateholders, the Depositor, the Master Servicer, the Securities
Administrator and the Servicer. The office of the Securities Administrator,
which for purposes of Certificate transfers and surrender is located at Xxxxx
Fargo Bank, N.A., Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx
00000, Attention: Corporate Trust Services - Client Manager (NHEL 2007-2),
and
for all other purposes is located at Xxxxx Xxxxx Xxxx, X.X., X.X. Xxx 00,
Xxxxxxxx, Xxxxxxxx 00000, Attention: Corporate Trust Services - Client Manager
(NHEL 2007-2) (or for overnight deliveries, at 0000 Xxx Xxxxxxxxx Xxxx,
Xxxxxxxx, Xxxxxxxx 00000, Attention: Corporate Trust Services - Client Manager
(NHEL 2007-2)).
Corresponding
Certificate:
With
respect to:
|
(i)
|
REMIC
II Regular Interest LT-IA1, the Class I-A-1
Certificates;
|
|
(ii)
|
REMIC
II Regular Interest LT-IIA1, the Class II-A-1
Certificates;
|
|
(iii)
|
REMIC
II Regular Interest LT-IIA2, the Class II-A-2
Certificates;
|
|
(iv)
|
REMIC
II Regular Interest LT-IIA3, the Class II-A-3
Certificates;
|
|
(v)
|
REMIC
II Regular Interest LT-IIA4, the Class II-A-4
Certificates;
|
|
(vi)
|
REMIC
II Regular Interest LT-M1, the Class M-1 Certificates;
|
|
(vii)
|
REMIC
II Regular Interest LT-M2, the Class M-2 Certificates;
|
|
(viii)
|
REMIC
II Regular Interest LT-M3, the Class M-3 Certificates;
|
|
(ix)
|
REMIC
II Regular Interest LT-M4, the Class M-4 Certificates;
|
|
(x)
|
REMIC
II Regular Interest LT-M5, the Class M-5 Certificates;
|
|
(xi)
|
REMIC
II Regular Interest LT-M6, the Class M-6 Certificates;
|
|
(xii)
|
REMIC
II Regular Interest LT-M7, the Class M-7 Certificates;
|
|
(xiii)
|
REMIC
II Regular Interest LT-M8, the Class M-8 Certificates;
|
|
(xiv)
|
REMIC
II Regular Interest LT-M9, the Class M-9 Certificates;
|
|
(xv)
|
REMIC
II Regular Interest LT-B1, the Class B-1 Certificates;
and
|
|
(xvi)
|
REMIC
II Regular Interest LT-P and the Class P Interest, the Class P
Certificates.
|
Credit
Risk Manager:
Xxxxx
Fargo Bank, National Association, and its successors and assigns.
Current
Interest:
With
respect to any Class of Senior Certificates and Subordinate Certificates and
any
Distribution Date, the amount of interest accruing at the applicable
Pass-Through Rate on the related Certificate Principal Balance during the
related Accrual Period; provided, that as to each Class of Senior Certificates
and Subordinate Certificates, the Current Interest will be reduced by a pro
rata
portion of any Net Interest Shortfalls to the extent not covered by excess
interest. No Current Interest will be payable with respect to any Class of
Senior Certificates or Subordinate Certificates after the Distribution Date
on
which the outstanding Certificate Principal Balance of such Class has been
reduced to zero.
Custodial
Account:
Each
account established and maintained by a Servicer with respect to receipts on
the
related Mortgage Loans and related REO Properties in accordance with
Section 3.26(b) of this Agreement or pursuant to the Servicing Agreement,
as applicable.
Custodial
Agreement:
The
Custodial Agreement dated as of January 1, 2007 among Xxxxx Fargo, in its
capacity as Custodian, the Servicers and the Trustee.
Custodian:
Xxxxx
Fargo Bank, N.A., or any successor thereto appointed pursuant to the Custodial
Agreement.
Cut-off
Date:
January
1, 2007.
Cut-off
Date Principal Balance:
As to
any Mortgage Loan, the unpaid principal balance thereof as of the close of
business on the Cut-off Date after application of all Principal Prepayments
received prior to the Cut-off Date and scheduled payments of principal due
on or
before the Cut-off Date, whether or not received, but without giving effect
to
any installments of principal received in respect of Due Dates after the Cut-off
Date.
DBRS:
DBRS,
Inc. or its successor in interest.
Debt
Service Reduction:
With
respect to any Mortgage Loan, any reduction in the amount which a Mortgagor
is
obligated to pay on a monthly basis with respect to a Mortgage Loan as a result
of any proceeding initiated under the United States Bankruptcy Code, other
than
a reduction attributable to Deficient Valuation or any reduction that results
in
permanent forgiveness of principal.
Defaulting
Party:
As
defined in the Swap Agreement.
Deferred
Amount:
With
respect to any Class of Subordinate Certificates and any Distribution Date,
the
amount by which (x) the aggregate of the Applied Loss Amounts previously applied
in reduction of the Certificate Principal Balance thereof exceeds (y) the
aggregate of amounts previously paid in reimbursement thereof and the amount
by
which the Certificate Principal Balance of any such Class has been increased
due
to the collection of Subsequent Recoveries.
Deficient
Valuation:
With
respect to any Mortgage Loan, is a valuation by a court of competent
jurisdiction of the Mortgaged Property in an amount less than the outstanding
indebtedness under the Mortgage Loan, or any reduction in the amount of
principal to be paid in connection with any scheduled payment that results
in a
permanent forgiveness of principal, which valuation results from a proceeding
initiated under the United States Bankruptcy Code.
Definitive
Certificates:
As
defined in Section 6.06.
Deleted
Mortgage Loan:
A
Mortgage Loan replaced or to be replaced by a Replacement Mortgage
Loan.
Delinquency
Rate:
With
respect to the Mortgage Loans and any calendar month will be, generally, the
fraction, expressed as a percentage, the numerator of which is the Aggregate
Loan Balance of all Mortgage Loans sixty (60) or more days delinquent (including
all Mortgage Loans in bankruptcy or foreclosure and all REO Properties) as
of
the close of business on the last day of such month, and the denominator of
which is the Aggregate Loan Balance of all Mortgage Loans as of the close of
business on the last day of such month.
Delinquent:
A
Mortgage Loan is “delinquent” if any payment due thereon is not made pursuant to
the terms of such Mortgage Loan by the close of business on the day such payment
is scheduled to be due. A Mortgage Loan is “30 days delinquent” if such payment
has not been received as of the close of business on the second subsequent
monthly Due Date. Similarly for “60 days delinquent,” “90 days delinquent” and
so on.
Denomination:
With
respect to each Certificate, the amount set forth on the face thereof as the
“Initial Certificate Principal Balance of this Certificate”.
Depositor:
Nomura
Home Equity Loan, Inc., a Delaware corporation, or its successor in
interest.
Depository:
The
initial Depository shall be The Depository Trust Company (“DTC”), the nominee of
which is Cede & Co., or any other organization registered as a “clearing
agency” pursuant to Section 17A of the Exchange Act. The Depository shall
initially be the registered Holder of the Book-Entry Certificates. The
Depository shall at all times be a “clearing corporation” as defined in
Section 8-102(a)(5) of the Uniform Commercial Code of the State of New
York.
Depository
Agreement:
With
respect to the Class of Book-Entry Certificates, the agreement among the
Depositor, the Trustee and the initial Depository, dated as of the Closing
Date,
substantially in the form of Exhibit I.
Depository
Participant:
A
broker, dealer, bank or other financial institution or other Person for whom
from time to time a Depository effects book-entry transfers and pledges of
securities deposited with the Depository.
Derivatives
Agreement:
Each of
the Basis Risk Cap Agreement, the Interest Rate Cap Agreement, and the Swap
Agreement.
Derivatives
Credit Support Annex:
Each of
the Basis Risk Cap Credit Support Annex, the Interest Rate Cap Credit Support
Annex, and the Swap Credit Support Annex.
Derivatives
Provider:
The
Basis Risk Cap Provider, the Interest Rate Cap Provider and the Swap Provider.
Initially, the Derivatives Provider shall be HSBC Bank USA, National
Association.
Determination
Date:
With
respect to any Distribution Date, the fifteenth (15th)
day of
the month of such Distribution Date or, if such day is not a Business Day,
the
immediately preceding Business Day.
Distribution
Account:
The
separate Eligible Account created and maintained by the Securities Administrator
pursuant to Section 3.31 in the name of the Trustee for the benefit of the
Certificateholders and designated “HSBC Bank USA, National Association, in trust
for registered holders of Nomura Home Equity Loan, Inc., Asset-Backed
Certificates, Series 2007-2”. Funds in the Distribution Account shall be held in
trust for the Certificateholders for the uses and purposes set forth in this
Agreement.
Distribution
Date:
The
twenty-fifth (25th)
day of
each calendar month after the initial issuance of the Certificates, or if such
twenty-fifth (25th)
day is
not a Business Day, the next succeeding Business Day, commencing in February
2007.
Due
Date:
As to
any Mortgage Loan, the date in each month on which the related Scheduled Payment
is due, as set forth in the related Mortgage Note.
Due
Period:
With
respect to any Distribution Date, the period from the second day of the calendar
month preceding the calendar month in which such Distribution Date occurs
through the close of business on the first day of the calendar month in which
such Distribution Date occurs.
Eligible
Account:
Any of
(i) an account or accounts maintained with a federal or state chartered
depository institution or trust company, the long-term unsecured debt
obligations and short-term unsecured debt obligations of which are rated by
each
Rating Agency in one of its two highest long-term and its highest short-term
rating categories respectively, at the time any amounts are held on deposit
therein, or (ii) an account or accounts in a depository institution or trust
company in which such accounts are insured by the FDIC (to the limits
established by the FDIC) and the uninsured deposits in which accounts are
otherwise secured such that, as evidenced by an Opinion of Counsel delivered
to
the Trustee and to each Rating Agency, the Certificateholders have a claim
with
respect to the funds in such account or a perfected first priority security
interest against any collateral (which shall be limited to Permitted
Investments) securing such funds that is superior to claims of any other
depositors or creditors of the depository institution or trust company in which
such account is maintained, or (iii) a segregated, non-interest bearing trust
account or accounts maintained with the corporate trust department of a federal
or state chartered depository institution or trust company having capital and
surplus of not less than $50,000,000, acting in its fiduciary capacity or (iv)
any other account acceptable to the Rating Agencies as evidenced in writing
by
the Rating Agencies. Eligible Accounts may bear interest, and may include,
if
otherwise qualified under this definition, accounts maintained with the Trustee
or Securities Administrator.
Equity
One:
Equity
One, Inc., a Delaware corporation, and any successor thereto appointed under
this Agreement in connection with the servicing and administration of the Equity
One Mortgage Loans.
Equity
One Mortgage Loans:
Those
Mortgage Loans serviced by Equity One pursuant to the terms and provisions
of
this Agreement and identified as such on the Mortgage Loan
Schedule.
ERISA:
The
Employee Retirement Income Security Act of 1974, as amended.
ERISA
Restricted Certificate:
Each of
the Class X, Class P and Residual Certificates.
Escrow
Account:
Shall
mean the account or accounts maintained by a Servicer pursuant to
Section 3.29 of this Agreement or pursuant to the Servicing Agreement, as
applicable. Each Escrow Account shall be an Eligible Account.
Excess
Basis Risk Cap Payment:
With
respect to any Distribution Date, the excess, if any, of (1) the cap payments
made by the Basis Risk Cap Provider under the Basis Risk Cap Agreement with
respect to the Senior Certificates and the Subordinate Certificates over (2)
the
amount of the unpaid Basis Risk Shortfall attributable to the Senior
Certificates and the Subordinate Certificates for such Distribution
Date.
Excess
Liquidation Proceeds: To the extent not required by law to be paid to the
related Mortgagor, the excess, if any, of any Liquidation Proceeds with respect
to a Mortgage Loan over the Stated Principal Balance of such Mortgage Loan
and
accrued and unpaid interest at the related Mortgage Rate through the last day
of
the month in which the Mortgage Loan has been liquidated.
Exchange
Act:
Securities and Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder.
Exemption:
Prohibited Transaction Exemption 93-32, as amended from time to
time.
Expense
Fee Rate:
With
respect to each Mortgage Loan, the sum of the Master Servicer Fee Rate,
Servicing Fee Rate and lender paid mortgage insurance rate, if applicable,
attributable to such Mortgage Loan.
Xxxxxx
Mae:
Xxxxxx
Xxx (formerly, Federal National Mortgage Association), or any successor
thereto.
FDIC:
The
Federal Deposit Insurance Corporation, or any successor thereto.
Final
Recovery Determination:
With
respect to any defaulted Mortgage Loan or any REO Property (other than a
Mortgage Loan or REO Property purchased by the Sponsor or the Master Servicer
pursuant to or as contemplated by Section 2.03(c) or Section 10.01), a
determination made by the related Servicer pursuant to this Agreement or the
Servicing Agreement, as applicable, that all Insurance Proceeds, Liquidation
Proceeds and other payments or recoveries which such Servicer, in its reasonable
good faith judgment, expects to be finally recoverable in respect thereof have
been so recovered. Each Servicer shall maintain records of each Final Recovery
Determination made thereby.
FIRREA:
The
Financial Institutions Reform, Recovery, and Enforcement Act of 1989, as
amended.
Fitch:
Fitch
Ratings and its successor in interest.
Form
8-K Disclosure Information:
As
defined in Section 5.14(c).
Xxxxxxx
Mac:
Federal
Home Loan Mortgage Corporation, or any successor thereto.
Gross
Margin:
With
respect to each adjustable rate Mortgage Loan, the fixed percentage set forth
in
the related Mortgage Note that is added to the Index on each Adjustment Date
in
accordance with the terms of the related Mortgage Note used to determine the
Mortgage Rate for such Mortgage Loan.
Group
I Certificates:
The
Class I-A-1 Certificates.
Group
I Allocation Amount:
With
respect to any Distribution Date, the product of the Senior Principal Payment
Amount for that Distribution Date and a fraction the numerator of which is
the
Principal Remittance Amount derived from the Group I Mortgage Loans and the
denominator of which is the Principal Remittance Amount, in each case for that
Distribution Date.
Group
I Allocation Percentage:
With
respect to any Distribution Date, the Aggregate Loan Group Balance of the Group
I Mortgage Loans divided by the Aggregate Loan Balance, in each case as of
the
first day of the related Due Period.
Group
I Excess Interest Amount:
With
respect to any Distribution Date, the product of the Monthly Excess Interest
required to be distributed on that Distribution Date pursuant to Section
5.04(a)(iii)(1)(A) and a fraction the numerator of which is the Principal
Remittance Amount derived from the Group I Mortgage Loans and the denominator
of
which is the Principal Remittance Amount, in each case for that Distribution
Date.
Group
I Mortgage Loans:
Those
Mortgage Loans identified on the Mortgage Loan Schedule as Group I Mortgage
Loans.
Group
II Certificates:
The
Class II-A-1, Class II-A-2, Class II-A-3 and Class II-A-4
Certificates.
Group
II Allocation Amount:
With
respect to any Distribution Date, the product of the Senior Principal Payment
Amount for that Distribution Date and a fraction the numerator of which is
the
Principal Remittance Amount derived from the Group II Mortgage Loans and the
denominator of which is the Principal Remittance Amount, in each case for that
Distribution Date.
Group
II Allocation Percentage:
With
respect to any Distribution Date, the Aggregate Loan Group Balance of the Group
II Mortgage Loans divided by the Aggregate Loan Balance, in each case as of
the
first day of the related Due Period.
Group
II Excess Interest Amount:
With
respect to any Distribution Date, the product of the Monthly Excess Interest
required to be distributed on that Distribution Date pursuant to Section
5.04(a)(iii)(1)(A) and a fraction the numerator of which is the Principal
Remittance Amount derived from the Group II Mortgage Loans and the denominator
of which is the Principal Remittance Amount, in each case for that Distribution
Date.
Group
II Mortgage Loans:
Those
Mortgage Loans identified on the Mortgage Loan Schedule as Group II Mortgage
Loans.
Indemnified
Persons:
The
Trustee, any Servicer (including any successor to any Servicer), the Master
Servicer, the Securities Administrator, the Custodian, the Trust Fund and their
officers, directors, agents and employees and, with respect to the Trustee,
any
separate co-trustee and its officers, directors, agents and
employees.
Independent:
When
used with respect to any specified Person, any such Person who (a) is in fact
independent of the Depositor, the Master Servicer, the Securities Administrator,
a Servicer, the Sponsor, any originator and their respective Affiliates, (b)
does not have any direct financial interest in or any material indirect
financial interest in the Depositor, the Master Servicer, the Securities
Administrator, the Servicer, the Sponsor, any originator or any Affiliate
thereof, and (c) is not connected with the Depositor, the Master Servicer,
the
Securities Administrator, a Servicer, the Sponsor, any originator or any
Affiliate thereof as an officer, employee, promoter, underwriter, trustee,
partner, director or Person performing similar functions; provided, however,
that a Person shall not fail to be Independent of the Depositor, the Master
Servicer, the Securities Administrator, a Servicer, the Sponsor, any originator
or any Affiliate thereof merely because such Person is the beneficial owner
of
one percent (1%) or less of any class of securities issued by the Depositor,
the
Master Servicer, the Securities Administrator, a Servicer, the Sponsor, any
originator or any Affiliate thereof, as the case may be. 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. Independent
means, 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 or indirect financial interest in such
other Person or any affiliate of such other Person, (C) is not connected with
such other Person or any affiliate of such other Person as an officer, employee,
promoter, underwriter, Securities Administrator, partner, director or Person
performing similar functions and (D) is not a member of the immediate family
of
a Person defined in clause (B) or (C) above.
Index:
As of
any Adjustment Date, the index applicable to the determination of the Mortgage
Rate on each adjustable rate Mortgage Loan which will generally be based on
Six-Month LIBOR or One-Year LIBOR.
Initial
Certificate Principal Balance:
With
respect to any Certificate, the Certificate Principal Balance of such
Certificate or any predecessor Certificate on the Closing Date.
Insurance
Policy:
With
respect to any Mortgage Loan included in the Trust Fund, any insurance policy,
including all riders and endorsements thereto in effect with respect to such
Mortgage Loan, including any replacement policy or policies for any Insurance
Policies.
Insurance
Proceeds:
Proceeds paid in respect of the Mortgage Loans pursuant to any Insurance Policy
or any other insurance policy covering a Mortgage Loan, to the extent such
proceeds are payable to the mortgagee under the Mortgage, the Servicer of the
related Mortgage Loan or the trustee under the deed of trust and are not applied
to the restoration of the related Mortgaged Property or released to the
Mortgagor in accordance with the servicing standard set forth in
Section 3.01 hereof or the Servicing Agreement, as applicable, other than
any amount included in such Insurance Proceeds in respect of Insured
Expenses.
Insured
Expenses:
Expenses covered by any Insurance Policy with respect to the Mortgage
Loans.
Interest
Determination Date:
The
second LIBOR Business Day preceding the commencement of each Accrual
Period.
Interest
Rate Cap Agreement:
The
interest rate cap agreement, dated as of January 31, 2007, between the
Supplemental Interest Trust Trustee and Interest Rate Cap Provider, including
any schedule, confirmations, credit support annex or other credit support
document relating thereto, and attached hereto as Exhibit R.
Interest
Rate Cap Credit Support Annex:
The
credit support annex, dated as of January 31, 2007, between the Supplemental
Interest Trust Trustee and the Interest Rate Cap Provider, which is annexed
to
and forms part of the Interest Rate Cap Agreement.
Interest
Rate Cap Provider: The cap provider under the Cap Agreement. Initially, the
Interest Rate Cap Provider shall be HSBC
Bank
USA, National Association.
Interest
Remittance Amount:
With
respect to any Distribution Date, an amount generally equal to the sum, without
duplication, of (a) all scheduled interest (other than with respect to
Payaheads) during the related Due Period with respect to the Mortgage Loans
due
during the related Due Period less the Servicing Fee, the Master Servicing
Fee
and the fee payable to any provider of lender-paid mortgage insurance, if any,
(b) the interest portion of Payaheads previously received and intended for
application in the related Due Period, (c) the interest portion of all Principal
Prepayments in full and partial Principal Prepayments received during the
related Prepayment Period, (d) all Advances relating to interest with respect
to
the Mortgage Loans made on or prior to the related Remittance Date, (e) all
Compensating Interest with respect to the Mortgage Loans and required to be
remitted by the related Servicers or the Master Servicer pursuant to this
Agreement or the Servicing Agreement with respect to such Distribution Date,
(f)
Liquidation Proceeds and Subsequent Recoveries with respect to the Mortgage
Loans collected during the related Prepayment Period (to the extent such
Liquidation Proceeds and Subsequent Recoveries relate to interest), (g) all
amounts relating to interest with respect to each Mortgage Loan repurchased
by
the Sponsor pursuant to Sections 2.02 and 2.03 and (h) all amounts in respect
of
interest paid by the Master Servicer pursuant to Section 10.01 to the
extent remitted by the Master Servicer to the Distribution Account pursuant
to
this Agreement, minus (i) all amounts required to be reimbursed by the Trust
Fund pursuant to Sections 3.27, 3.32, 7.03 or as otherwise set forth in
this Agreement or the Custodial Agreement, allocated to the respective Loan
Group on a pro rata basis, based on the Aggregate Loan Group Balance as of
the
last day of the related Due Period, to the extent such amounts are attributable
to both Loan Groups, and otherwise allocated to the Loan Group to which such
amounts are attributable.
Interest
Shortfall:
With
respect to any Distribution Date, the aggregate shortfall, if any, in
collections of interest (adjusted to the related Net Mortgage Rates) on Mortgage
Loans resulting from (a) Principal Prepayments in full received during the
related Prepayment Period, (b) partial Principal Prepayments received during
the
related Prepayment Period to the extent applied prior to the Due Date in the
month of the Distribution Date and (c) interest payments on certain of the
Mortgage Loans being limited pursuant to the provisions of the Relief
Act.
ISDA
Master Agreement:
The
ISDA Master Agreement dated as of January 31, 2007, as amended and supplemented
from time to time, between the Swap Provider and the Trustee, as trustee on
behalf of the Supplemental Interest Trust.
Last
Scheduled Distribution Date:
With
respect to the Certificates, the Distribution Date in January 2037.
Latest
Possible Maturity Date:
The
first Distribution Date following the final scheduled maturity date of the
Mortgage Loan in the Trust Fund having the latest scheduled maturity date as
of
the Cut-off Date. For purposes of the Treasury Regulations under Code
Section 860A through 860G, the latest possible maturity date of each
regular interest issued by each REMIC shall be the Latest Possible Maturity
Date.
LIBOR
Business Day:
Any day
other than a Saturday or a Sunday or a day on which banking institutions in
the
State of New York or in the city of London, England are required or authorized
by law to be closed.
LIBOR
Determination Date:
The
second LIBOR Business Day before the first day of the related Accrual
Period.
Liquidated
Loan:
With
respect to any Distribution Date, a defaulted Mortgage Loan that has been
liquidated through deed-in-lieu of foreclosure, foreclosure sale, trustee’s sale
or other realization as provided by applicable law governing the real property
subject to the related Mortgage and any security agreements and as to which
the
related Servicer has certified in the related Prepayment Period in writing
to
the Securities Administrator that it has made a Final Recovery
Determination.
Liquidation
Proceeds:
Amounts, other than Insurance Proceeds, received in connection with the partial
or complete liquidation of a Mortgage Loan, whether through trustee’s sale,
foreclosure sale or otherwise, or in connection with any condemnation or partial
release of a Mortgaged Property and any other proceeds received with respect
to
an REO Property, less the sum of related unreimbursed Advances, Servicing Fees
and Servicing Advances and all expenses of liquidation, including property
protection expenses and foreclosure and sale costs, including court and
reasonable attorneys fees.
Loan
Group:
Either
Loan Group I or Loan Group II. “Loan Group I” refers to the Group I Mortgage
Loans and “Loan Group II” refers to the Group II Mortgage Loans.
Loan-to-Value
Ratio:
The
fraction, expressed as a percentage, the numerator of which is the original
principal balance of the Mortgage Loan and the denominator of which is the
Appraised Value of the related Mortgaged Property.
Majority
Class X Certificateholder:
The
Holder of a 50.01% or greater Percentage Interest in the Class X
Certificates.
Marker
Rate:
With
respect to the Class X Interest and any Distribution Date, a per annum rate
equal to two (2) times the weighted average of the Uncertificated REMIC II
Pass-Through Rates for REMIC II Regular Interest LT-IA1, REMIC II Regular
Interest LT-IIA1, REMIC II Regular Interest LT-IIA2, REMIC II Regular Interest
LT-IIA3, REMIC II Regular Interest LT-IIA4, REMIC II Regular Interest LT-M1,
REMIC II Regular Interest LT-M2, REMIC II Regular Interest LT-M3, REMIC II
Regular Interest LT-M4, REMIC II Regular Interest LT-M5, REMIC II Regular
Interest LT-M6, REMIC II Regular Interest LT-M7, REMIC II Regular Interest
LT-M8, REMIC II Regular Interest LT-M9, REMIC II Regular Interest LT-B1 and
REMIC II Regular Interest LT-ZZ, with the per annum rate on each such REMIC
II
Regular Interest (other than REMIC II Regular Interest LT-ZZ) subject to a
cap
equal to the Pass-Through Rate on the Corresponding Certificate for the purpose
of this calculation; and with the per annum rate on REMIC II Regular Interest
LT-ZZ subject to a cap of zero for the purpose of this calculation; provided,
however, that for this purpose, the calculation of the Uncertificated REMIC
II
Pass-Through Rate and the related cap with respect to each such REMIC II Regular
Interest (other than REMIC II Regular Interest LT-ZZ) shall be multiplied by
a
fraction, the numerator of which is the actual number of days in the Accrual
Period and the denominator of which is thirty (30).
Master
Servicer:
As of
the Closing Date, Xxxxx Fargo Bank, N.A. and thereafter, its respective
successors in interest who meet the qualifications of this Agreement. The Master
Servicer and the Securities Administrator shall at all times be the same Person
or Affiliates.
Master
Servicer Default:
One or
more of the events described in Section 8.01(b).
Master
Servicing Compensation:
The
Master Servicing Fee plus all income and gain realized from any investment
of
funds in the Distribution Account.
Master
Servicing Fee:
With
respect to each Mortgage Loan and for any calendar month, an amount equal to
one
twelfth of the product of the Master Servicing Fee Rate multiplied by the Stated
Principal Balance of the Mortgage Loans as of the Due Date in the preceding
calendar month. The Master Servicing Fee includes the Credit Risk Manager’s
fee.
Master
Servicing Fee Rate:
0.0140%
per annum.
Maximum
Interest Rate:
With
respect to any Distribution Date and the related Accrual Period, an annual
rate
equal to the weighted average of the Maximum Mortgage Interest Rates of the
adjustable rate Mortgage Loans and the Mortgage Rates of the fixed rate Mortgage
Loans in the related Loan Groups as stated in the related Mortgage Notes minus
the weighted average Expense Fee Rate of the Mortgage Loans in the related
Loan
Group. The calculation of the Maximum Interest Rate will be based on a 360-day
year and the actual number of days elapsed during the related Accrual
Period.
Maximum
Mortgage Interest Rate:
With
respect to each adjustable rate Mortgage Loan, the percentage set forth in
the
related Mortgage Note as the maximum interest rate thereunder.
MERS:
Mortgage Electronic Registration Systems, Inc., a corporation organized and
existing under the laws of the State of Delaware, or any successor
thereto.
MERS®
System:
The
system of recording transfers of Mortgages electronically maintained by
MERS.
Mezzanine
Certificates:
The
Class M-1, Class X-0, Xxxxx, X-0, Class M-4, Class M-5, Class M-6, Class M-7,
Class M-8 and Class M-9 Certificates.
MIN:
The
Mortgage Identification Number for Mortgage Loans registered with MERS on the
MERS® System.
Minimum
Mortgage Interest Rate:
With
respect to each adjustable rate Mortgage Loan, the percentage set forth in
the
related Mortgage Note as the minimum Mortgage Rate thereunder.
Minimum
Servicing Requirements:
With
respect to a Successor Servicer appointed pursuant to Section 7.06(b)
hereunder:
(ii) the
proposed Successor Servicer is (1) an Affiliate of the Master Servicer that
services mortgage loans similar to the Mortgage Loans in the jurisdictions
in
which the related Mortgaged Properties are located or (2) the proposed Successor
Servicer has a rating of at least “Above Average” by S&P and either a rating
of at least “RPS2” by Fitch or a rating of at least “SQ2” by Moody’s;
and
(iii) the
proposed Successor Servicer has a net worth of at least
$25,000,000.
MOM
Loan:
Any
Mortgage Loan as to which MERS is acting as the mortgagee of such Mortgage
Loan,
solely as nominee for the originator of such Mortgage Loan and its successors
and assigns, at the origination thereof.
Monthly
Excess Cashflow:
With
respect to any Distribution Date, means the sum of (a) the Monthly Excess
Interest, (b) the Overcollateralization Release Amount, if any, for such
Distribution Date, and (c) the Principal Remittance Amount remaining following
payments of the Principal Payment Amount to the Supplemental Interest Trust
in
respect of any Net Swap Payment and any Swap Termination Payment owed to the
Swap Provider and remaining unpaid after distribution of the Interest Remittance
Amount to the Senior Certificates and Subordinate Certificates in respect of
principal.
Monthly
Excess Interest:
With
respect to any Distribution Date, the excess of (x) the Interest Remittance
Amount for such Distribution Date over (y) the sum of any Net Swap Payment
and
any Swap Termination Payment payable to the Supplemental Interest Trust and
owed
to the Swap Provider and Current Interest and Carryforward Interest on the
Senior Certificates and Subordinate Certificates, in each case for such
Distribution Date.
Monthly
Statement:
The
statement delivered to the Certificateholders pursuant to
Section 5.06.
Moody’s:
Xxxxx’x
Investors Service, Inc. or its successor in interest.
Mortgage:
The
mortgage, deed of trust or other instrument creating a first or second lien
on,
or first or second priority security interest in, a Mortgaged Property securing
a Mortgage Note.
Mortgage
File:
The
Mortgage Loan Documents pertaining to a particular Mortgage Loan and any
additional documents delivered to the Trustee or the Custodian on behalf of
the
Trustee to be added to the Mortgage File pursuant to this
Agreement.
Mortgage
Loan Documents:
As
defined in Section 2.01.
Mortgage
Loans:
Each of
the Mortgage Loans transferred and assigned to the Trustee pursuant to the
provisions hereof, as from time to time are held as a part of the Trust Fund
(including any REO Property), the mortgage loans so held being identified in
the
Mortgage Loan Schedule, notwithstanding foreclosure or other acquisition of
title of the related Mortgaged Property.
Mortgage
Loan Purchase Agreement:
The
Mortgage Loan Purchase Agreement dated as of January 31, 2007, between the
Sponsor, as seller and the Depositor, as purchaser, a form of which is attached
hereto as Exhibit
C.
Mortgage
Loan Schedule:
The
list of Mortgage Loans (as from time to time amended by the Servicer of the
related Mortgage Loans to reflect the deletion of Deleted Mortgage Loans and
the
addition of Replacement Mortgage Loans pursuant to the provisions of this
Agreement) transferred to the Trustee as part of the Trust Fund and from time
to
time subject to this Agreement, setting forth the following information with
respect to each Mortgage Loan:
(i) the
Mortgage Loan identifying number;
(ii) a
code
indicating whether the Mortgaged Property is owner-occupied;
(iii) the
type
of Residential Dwelling constituting the Mortgaged Property;
(iv) the
original months to maturity;
(v) the
original date of the Mortgage Loan and the remaining months to maturity from
the
Cut-off Date, based on the original amortization schedule;
(vi) the
Loan-to-Value Ratio or Combined Loan-to-Value Ratio, as applicable, at
origination;
(vii) the
Mortgage Rate in effect immediately following the Cut-off Date;
(viii) the
date
on which the first Monthly Payment was due on the Mortgage Loan;
(ix) the
stated maturity date;
(x) the
amount of the Monthly Payment at origination;
(xi) the
amount of the Monthly Payment as of the Cut-off Date;
(xii) the
last
Due Date on which a Monthly Payment was actually applied to the unpaid Stated
Principal Balance;
(xiii) the
original principal amount of the Mortgage Loan;
(xiv) the
Stated Principal Balance of the Mortgage Loan as of the close of business on
the
Cut-off Date;
(xv) with
respect to each adjustable rate Mortgage Loan, the first Adjustment
Date;
(xvi) with
respect to each adjustable rate Mortgage Loan, the Gross Margin;
(xvii) a
code
indicating the purpose of the loan (i.e., purchase financing, rate/term
refinancing, cash-out refinancing);
(xviii) with
respect to each adjustable rate Mortgage Loan, the Maximum Mortgage Rate under
the terms of the Mortgage Note;
(xix) with
respect to each adjustable rate Mortgage Loan, the Minimum Mortgage Rate under
the terms of the Mortgage Note;
(xx) the
Mortgage Rate at origination;
(xxi) with
respect to each adjustable rate Mortgage Loan, the Periodic Rate
Cap;
(xxii) with
respect to each adjustable rate Mortgage Loan, the first Adjustment Date
immediately following the Cut-off Date;
(xxiii) with
respect to each adjustable rate Mortgage Loan, the Index;
(xxiv) the
date
on which the first Monthly Payment was due on the Mortgage Loan and, if such
date is not consistent with the Due Date currently in effect, such Due
Date;
(xxv) a
code
indicating whether the Mortgage Loan is an adjustable rate Mortgage Loan or
a
fixed rate Mortgage Loan;
(xxvi) a
code
indicating the documentation style (i.e., full, stated or limited);
(xxvii) a
code
indicating if the Mortgage Loan is subject to a primary insurance policy or
lender paid mortgage insurance policy and the name of the insurer;
(xxviii) the
Appraised Value of the Mortgaged Property;
(xxix) the
sale
price of the Mortgaged Property, if applicable;
(xxx) a
code
indicating whether the Mortgage Loan is subject to a Prepayment Charge, the
term
of such Prepayment Charge and the amount of such Prepayment Charge;
(xxxi) the
product type (e.g., 2/28, 15 year fixed, 30 year fixed, 15/30 balloon,
etc.);
(xxxii) the
Mortgagor’s debt to income ratio;
(xxxiii) the
FICO
score at origination;
(xxxiv) the
related Loan Group; and
(xxxv) the
Servicer.
Such
schedule shall also set forth the aggregate Cut-off Date Principal Balance
for
all of the Mortgage Loans.
Mortgage
Note:
The
original executed note or other evidence of indebtedness of a Mortgagor under
a
Mortgage Loan.
Mortgage
Rate:
With
respect to each Mortgage Loan, the annual rate at which interest accrues on
such
Mortgage Loan from time to time in accordance with the provisions of the related
Mortgage Note, which rate with respect to each adjustable rate Mortgage Loan
(A)
as of any date of determination until the first Adjustment Date following the
Cut-off Date shall be the rate set forth in the Mortgage Loan Schedule as the
Mortgage Rate in effect immediately following the Cut-off Date and (B) as of
any
date of determination thereafter shall be the rate as adjusted on the most
recent Adjustment Date equal to the sum, rounded to the nearest 0.125% as
provided in the Mortgage Note, of the related Index, as most recently available
as of a date prior to the Adjustment Date as set forth in the related Mortgage
Note, plus the related Gross Margin; provided that the Mortgage Rate on such
adjustable rate Mortgage Loan on any Adjustment Date shall never be more than
the lesser of (i) the sum of the Mortgage Rate in effect immediately prior
to
the Adjustment Date plus the related Periodic Rate Cap, if any, and (ii) the
related Maximum Mortgage Rate, and shall never be less than the greater of
(i)
the Mortgage Rate in effect immediately prior to the Adjustment Date less the
Periodic Rate Cap, if any, and (ii) the related Minimum Mortgage Rate. With
respect to each Mortgage Loan that becomes an REO Property, as of any date
of
determination, the annual rate determined in accordance with the immediately
preceding sentence as of the date such Mortgage Loan became an REO
Property.
Mortgaged
Property:
The
underlying property securing a Mortgage Loan.
Mortgagor:
The
obligor on a Mortgage Note.
Net
Funds Cap:
With
respect to any Distribution Date and the Senior Certificates and Subordinate
Certificates, a per annum rate equal to the product of (I)(a) a fraction,
expressed as a percentage, the numerator of which is the Optimal Interest
Remittance Amount for such Distribution Date and the denominator of which is
the
aggregate Stated Principal Balance of the Mortgage Loans for the immediately
preceding Distribution Date, minus (b) the sum of (1) any Net Swap Payment
payable to the Swap Provider on such Distribution Date, and (2) any Swap
Termination Payment (unless such payment is the result of a Swap Provider
Trigger Event and to the extent not paid by the Securities Administrator from
any upfront payment received pursuant to any replacement swap agreement that
may
be entered into by the Supplemental Interest Trust Trustee) payable to the
Swap
Provider on such Distribution Date, divided by the outstanding aggregate Stated
Principal Balance of the Mortgage Loans for the immediately preceding
Distribution Date and (II) 12. The Net Funds Cap will be adjusted to an
effective rate reflecting the accrual of interest on an actual/360 basis. With
respect to any Distribution Date and the REMIC III Regular Interests the
ownership of which is represented by the Class A, Mezzanine, and Class B-1
Certificates, a per annum rate equal to the weighted average (adjusted for
the
actual number of days elapsed in the related Accrual Period) of the
Uncertificated REMIC II Pass-Through Rates on the REMIC II Regular Interests
(other than REMIC II Regular Interest LT-IO and REMIC II Regular Interest LT-P),
weighted on the basis of the Uncertificated Principal Balance of each such
REMIC
II Regular Interest immediately prior to such Distribution Date.
Net
Interest Shortfalls:
With
respect to the Mortgage Loans, Interest Shortfalls net of payments by the
related Servicer or the Master Servicer in respect of Compensating
Interest.
Net
Mortgage Rate:
As to
each Mortgage Loan, and at any time, the per annum rate equal to the related
Mortgage Rate less the Expense Fee Rate.
Net
Swap Payment:
With
respect to each Distribution Date, the net payment required to be made pursuant
to the terms of the Swap Agreement by either the Swap Provider or the
Supplemental Interest Trust, which net payment shall not take into account
any
Swap Termination Payment.
Non-Book-Entry
Certificate:
Any
Certificate other than a Book-Entry Certificate.
Nonrecoverable
Advance:
With
respect to any Mortgage Loan, any portion of an Advance or Servicing Advance
previously made or proposed to be made by the related Servicer pursuant to
this
Agreement or the Servicing Agreement, as applicable, or the Master Servicer
as
Successor Servicer, that, in the good faith judgment of such Servicer or the
Master Servicer as Successor Servicer, will not or, in the case of a proposed
Advance or Servicing Advance, would not, be ultimately recoverable by it from
the related Mortgagor, related Liquidation Proceeds, Insurance Proceeds or
otherwise.
Notional
Amount:
For
each Distribution Date, an amount equal to the lesser of (a) the Aggregate
Loan
Balance of the Mortgage Loans on the Business Day immediately preceding such
Distribution Date and (b) the Swap Notional Amount for such Distribution Date
as
set forth in the Swap Agreement.
Ocwen:
Ocwen
Loan Servicing LLC, and any successor thereto appointed under this Agreement
in
connection with the servicing and administration of the Ocwen Mortgage Loans.
Ocwen
Mortgage Loans:
Those
Mortgage Loans serviced by Ocwen pursuant to the terms and provisions of this
Agreement and identified as such on the Mortgage Loan Schedule.
Officer’s
Certificate:
A
certificate (i) signed by the Chairman of the Board, the Vice Chairman of the
Board, the President, a Vice President (however denominated), an Assistant
Vice
President, the Treasurer, the Secretary, or one of the assistant treasurers
or
assistant secretaries of the Depositor, the Sponsor, the Securities
Administrator or the Trustee (or any other officer customarily performing
functions similar to those performed by any of the above designated officers
and
also to whom, with respect to a particular matter, such matter is referred
because of such officer’s knowledge of and familiarity with a particular
subject) or (ii), if provided for in this Agreement, signed by a Servicing
Officer of a Servicer or an Authorized Servicer Representative of the Master
Servicer, as the case may be, and delivered to the Depositor, the Sponsor,
the
Master Servicer, the Securities Administrator and/or the Trustee, as the case
may be, as required by this Agreement.
One-Month
LIBOR:
With
respect to any Accrual Period (other than the first Accrual Period), the rate
determined by the Securities Administrator on the related Interest Determination
Date on the basis of the rate for U.S. dollar deposits for one month that
appears on Telerate Screen Page 3750 as of 11:00 a.m. (London time) on such
Interest Determination Date. If such rate does not appear on such page (or
such
other page as may replace that page on that service, or if such service is
no
longer offered, such other service for displaying One-Month LIBOR or comparable
rates as may be reasonably selected by the Securities Administrator), One-Month
LIBOR for the applicable Accrual Period will be the Reference Bank Rate. If
no
such quotations can be obtained by the Securities Administrator and no Reference
Bank Rate is available, One-Month LIBOR will be One-Month LIBOR applicable
to
the preceding Accrual Period. The establishment of One-Month LIBOR on each
Interest Determination Date by the Securities Administrator and the Securities
Administrator’s calculation of the rate of interest applicable to the Senior
Certificates and the Subordinate Certificates for the related Accrual Period
shall, in the absence of manifest error, be final and binding. With respect
to
the first Accrual period, One-Month LIBOR shall equal 5.320% per
annum.
One-Year
LIBOR: The
per
annum rate equal to the average of interbank offered rates for one-year U.S.
dollar-denominated deposits in the London market based on quotations of major
banks as published in The Wall Street Journal and most recently available as
of
the time specified in the related Mortgage Note.
Opinion
of Counsel:
A
written opinion of counsel, who may be counsel for the Sponsor, the Master
Servicer, the Depositor or a Servicer, reasonably acceptable to each addressee
of such opinion; provided that with respect to Section 2.05, 7.05 or 11.01,
or the interpretation or application of the REMIC Provisions, such counsel
must
(i) in fact be independent of the Sponsor, the Master Servicer Depositor and
such Servicer, (ii) not have any direct financial interest in the Sponsor,
the
Depositor, the Master Servicer or such Servicer or in any Affiliate of any
of
them, and (iii) not be connected with the Sponsor, the Depositor, the Master
Servicer or such Servicer as an officer, employee, promoter, underwriter,
trustee, partner, director or person performing similar functions.
Optimal
Interest Remittance Amount:
With
respect to any Distribution Date, an amount equal to the excess of (i) the
product of (1)(x) the weighted average Net Mortgage Rates of the Mortgage Loans
as of the first day of the related Due Period divided by (y) 12 and (2) the
Aggregate Loan Balance for the immediately preceding Distribution Date, over
(ii) any expenses that reduce the Interest Remittance Amount that did not arise
as a result of a default or delinquency of the Mortgage Loans in the related
Loan Group or were not taken into account in computing the Expense Fee
Rate.
Optional
Termination:
The
termination of the Trust Fund created hereunder as a result of the purchase
of
all of the Mortgage Loans and any related REO Property pursuant to
Section 10.01.
Optional
Termination Date:
The
first Distribution Date on which the Master Servicer may purchase, at its
option, the Mortgage Loans and related REO Properties as described in
Section 10.01.
OTS:
The
Office of Thrift Supervision or any successor thereto.
Outstanding:
With
respect to the Certificates as of any date of determination, all Certificates
theretofore executed and authenticated under this Agreement except:
(a) Certificates
theretofore canceled by the Securities Administrator or delivered to the
Securities Administrator for cancellation; and
(b) Certificates
in exchange for which or in lieu of which other Certificates have been executed
and delivered by the Securities Administrator pursuant to this
Agreement.
Outstanding
Mortgage Loan:
As of
any date of determination, a Mortgage Loan with a Stated Principal Balance
greater than zero that was not the subject of a Principal Prepayment in full,
and that did not become a Liquidated Loan, prior to the end of the related
Prepayment Period.
Overcollateralization
Amount:
With
respect to any Distribution Date, the excess, if any, of (a) the Aggregate
Loan
Balance for such Distribution Date (after giving effect to scheduled payments
of
principal due during the related Due Period to the extent received or advanced,
unscheduled collections of principal received during the related Prepayment
Period and after reduction for Realized Losses on the Mortgage Loans incurred
during the related Due Period) over (b) the aggregate Certificate Principal
Balance of the Senior Certificates and the Subordinate Certificates on such
Distribution Date (after taking into account the payment of 100% of the
Principal Remittance Amount on such Distribution Date.
Overcollateralization
Deficiency Amount:
With
respect to any Distribution Date, the amount, if any, by which (x) the Targeted
Overcollateralization Amount for such Distribution Date exceeds (y) the
Overcollateralization Amount for such Distribution Date, calculated for this
purpose after giving effect to the reduction on such Distribution Date of the
aggregate Certificate Principal Balance of the Senior Certificates and the
Subordinate Certificates resulting from the payment of the Principal Remittance
Amount on such Distribution Date, but prior to allocation of any Applied Loss
Amount on such Distribution Date.
Overcollateralization
Release Amount:
With
respect to any Distribution Date, the lesser of (x) the Principal Remittance
Amount for such Distribution Date and (y) the amount, if any, by which (1)
the
Overcollateralization Amount for such date exceeds (2) the Targeted
Overcollateralization Amount for such Distribution Date.
Ownership
Interest:
As to
any Certificate, any ownership interest in such Certificate including any
interest in such Certificate as the Holder thereof and any other interest
therein, whether direct or indirect, legal or beneficial.
Pass-Through
Rate:
The
Class I-A-1 Pass-Through
Rate,
Class
II-A-1 Pass-Through Rate, Class II-A-2 Pass-Through Rate, Class II-A-3
Pass-Through Rate, Class II-A-4 Pass-Through Rate, Class M-1 Pass-Through Rate,
Class M-2 Pass-Through Rate, Class M-3 Pass-Through Rate, Class M-4 Pass-Through
Rate, Class M-5 Pass-Through Rate, Class M-6 Pass-Through Rate, Class M-7
Pass-Through Rate, Class M-8 Pass-Through Rate, Class M-9 Pass-Through Rate
and
Class B-1 Pass-Through Rate, as applicable. With respect to Class X
Certificates, 100% of the interest distributable to the Class X Interest,
expressed as a per annum rate.
Payahead:
Any
Scheduled Payment intended by the related Mortgagor to be applied in a Due
Period subsequent to the Due Period in which such payment was
received.
PCAOB:
Shall
mean the Public Company Accounting Oversight Board.
Percentage
Interest:
With
respect to any Certificate of a specified Class, the Percentage Interest set
forth on the face thereof or the percentage obtained by dividing the
Denomination of such Certificate by the aggregate of the Denominations of all
Certificates of such Class.
Periodic
Rate Cap:
With
respect to the Adjustment Date for any adjustable rate Mortgage Loan, the fixed
percentage set forth in the related Mortgage Note, which is the maximum amount
by which the Mortgage Rate for such adjustable rate Mortgage Loan may increase
or decrease (without regard to the Maximum Mortgage Interest Rate or the Minimum
Mortgage Interest Rate) on such Adjustment Date from the Mortgage Rate in effect
immediately prior to such Adjustment Date.
Permitted
Investments:
At any
time, any one or more of the following obligations and securities:
(i) direct
obligations of, or obligations fully guaranteed as to timely payment of
principal and interest by, the United States or any agency thereof, provided
such obligations are unconditionally backed by the full faith and credit of
the
United States;
(ii) general
obligations of or obligations guaranteed by any state of the United States
or
the District of Columbia receiving the highest long-term debt rating of each
Rating Agency, or such lower rating as will not result in the downgrading or
withdrawal of the ratings then assigned to the Certificates by each Rating
Agency, as evidenced by a signed writing delivered by each Rating
Agency;
(iii) commercial
or finance company paper which is then receiving the highest commercial or
finance company paper rating of each Rating Agency that rates such securities,
or such lower rating as will not result in the downgrading or withdrawal of
the
ratings then assigned to the Certificates by each Rating Agency, as evidenced
by
a signed writing delivered by each Rating Agency;
(iv) certificates
of deposit, demand or time deposits, or bankers’ acceptances issued by any
depository institution or trust company incorporated under the laws of the
United States or of any state thereof and subject to supervision and examination
by federal and/or state banking authorities (including the Trustee or the Master
Servicer in its commercial banking capacity), provided that the commercial
paper
and/or long term unsecured debt obligations of such depository institution
or
trust company are then rated one of the two highest long-term and the highest
short-term ratings of each such Rating Agency for such securities, or such
lower
ratings as will not result in the downgrading or withdrawal of the rating then
assigned to the Certificates by any Rating Agency, as evidenced by a signed
writing delivered by each Rating Agency;
(v) demand
or
time deposits or certificates of deposit issued by any bank or trust company
or
savings institution to the extent that such deposits are fully insured by the
FDIC;
(vi) guaranteed
reinvestment agreements issued by any bank, insurance company or other
corporation containing, at the time of the issuance of such agreements, such
terms and conditions as will not result in the downgrading or withdrawal of
the
rating then assigned to the Certificates by any such Rating Agency, as evidenced
by a signed writing delivered by each Rating Agency;
(vii) repurchase
obligations with respect to any security described in clauses (i) and (ii)
above, in either case entered into with a depository institution or trust
company (acting as principal) described in clause (iv) above;
(viii) securities
(other than stripped bonds, stripped coupons or instruments sold at a purchase
price in excess of 115% of the face amount thereof) bearing interest or sold
at
a discount issued by any corporation incorporated under the laws of the United
States or any state thereof which, at the time of such investment, have one
of
the two highest long term ratings of each Rating Agency, or such lower rating
as
will not result in the downgrading or withdrawal of the rating then assigned
to
the Certificates by any Rating Agency, as evidenced by a signed writing
delivered by each Rating Agency;
(ix) units
of
money market funds registered under the Investment Company Act of 1940 including
funds managed or advised by the Trustee, the Master Servicer or an Affiliate
of
either, having a rating by S&P of AAAm or AAAm-G, if rated by Xxxxx’x, rated
Aaa, Aa1 or Aa2 and if rated by Fitch, F1, F2 or F3;
(x) short
term investment funds sponsored by any trust company or banking association
incorporated under the laws of the United States or any state thereof (including
any such fund managed or advised by the Trustee, the Master Servicer or any
Affiliate thereof) which on the date of acquisition has been rated by each
Rating Agency in their respective highest applicable rating category or such
lower rating as will not result in the downgrading or withdrawal of the ratings
then assigned to the Certificates by each Rating Agency, as evidenced by a
signed writing delivered by each Rating Agency; and
(xi) such
other investments having a specified stated maturity and bearing interest or
sold at a discount acceptable to each Rating Agency as will not result in the
downgrading or withdrawal of the rating then assigned to the Certificates by
any
Rating Agency, as evidenced by a signed writing delivered by each Rating Agency,
as evidenced by a signed writing delivered by each Rating Agency;
provided,
however, that no instrument described hereunder shall evidence either the right
to receive (a) only interest with respect to the obligations underlying such
instrument or (b) both principal and interest payments derived from obligations
underlying such instrument and the interest and principal payments with respect
to such instrument provide a yield to maturity at par greater than 120% of
the
yield to maturity at par of the underlying obligations.
Permitted
Transferee:
Any
person other than (i) the United States, any State or political subdivision
thereof, any possession of the United States or any agency or instrumentality
of
any of the foregoing, (ii) a foreign government, International Organization
or
any agency or instrumentality of either of the foregoing, (iii) an organization
(except certain farmers’ cooperatives described in Section 521 of the Code)
that is exempt from tax imposed by Chapter 1 of the Code (including the tax
imposed by Section 511 of the Code on unrelated business taxable income) on
any excess inclusions (as defined in Section 860E(c)(1) of the Code) with
respect to any Residual Certificate, (iv) rural electric and telephone
cooperatives described in Section 1381(a)(2)(C) of the Code, (v) a Person
that is not a citizen or resident of the United States, a corporation,
partnership (other than a partnership that has any direct or indirect foreign
partners) or other entity (treated as a corporation or a partnership for federal
income tax purposes), created or organized in or under the laws of the United
States, any state thereof or the District of Columbia, an estate whose income
from sources without the United States is includible in gross income for United
States federal income tax purposes regardless of its connection with the conduct
of a trade or business within the United States, 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 persons have authority
to control all substantial decisions of the trustor and (vi) any other Person
based upon an Opinion of Counsel (which shall not be an expense of the Trustee)
that states that the Transfer of an Ownership Interest in a Residual Certificate
to such Person may cause any REMIC to fail to qualify as a REMIC at any time
that any Certificates are Outstanding. The terms “United States,” “State” and
“International Organization” shall have the meanings set forth in
Section 7701 of the Code or successor provisions. A corporation will not be
treated as an instrumentality of the United States or of any State or political
subdivision thereof for these purposes if all of its activities are subject
to
tax and, with the exception of Xxxxxxx Mac, a majority of its board of directors
is not selected by such government unit.
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.
Prepayment
Assumption:
The
assumed rate of prepayment, as described in the Prospectus Supplement relating
to each Class of Publicly Offered Certificates.
Prepayment
Charge:
With
respect to any Principal Prepayment, any prepayment premium, penalty or charge
payable by a Mortgagor in connection with any Principal Prepayment on a Mortgage
Loan pursuant to the terms of the related Mortgage Note (other than any Servicer
Prepayment Charge Payment Amount) as shown on the Prepayment Charge
Schedule.
Prepayment
Charge Schedule:
As of
any date, the list of Mortgage Loans providing for a Prepayment Charge included
in the Trust Fund on such date, attached hereto as Exhibit K (including the
prepayment charge summary attached thereto). The Depositor shall deliver or
cause the delivery of the Prepayment Charge Schedule to the Servicers, the
Master Servicer and the Trustee on the Closing Date. The Prepayment Charge
Schedule shall set forth the following information with respect to each
Prepayment Charge:
|
(i)
|
the
Mortgage Loan identifying number;
|
|
(ii)
|
a
code indicating the type of Prepayment Charge;
|
|
(iii)
|
the
date on which the first Monthly Payment was due on the related Mortgage
Loan;
|
|
(iv)
|
the
term of the related Prepayment Charge;
|
|
(v)
|
the
original Stated Principal Balance of the related Mortgage Loan;
and
|
|
(vi)
|
the
Stated Principal Balance of the related Mortgage Loan as of the Cut-off
Date.
|
Prepayment
Interest Excess:
With
respect to each Mortgage Loan serviced by Ocwen, Equity One or SPS that was
the
subject of a Principal Prepayment in full during the portion of the related
Prepayment Period occurring between the first day of the calendar month in
which
such Distribution Date occurs and the Determination Date of the calendar month
in which such Distribution Date occurs, an amount equal to interest (to the
extent received) at the applicable Net Mortgage Rate on the amount of such
Principal Prepayment for the number of days commencing on the first day of
the
calendar month in which such Distribution Date occurs and ending on the last
date through which interest is collected from the related Mortgagor. Ocwen,
Equity One and SPS may withdraw such Prepayment Interest Excess from the related
Custodial Account in accordance with Section 3.27(a)(i) of this
Agreement.
Prepayment
Interest Shortfall:
With
respect to any Distribution Date, for each Mortgage Loan that was the subject
of
a Principal Prepayment during the related Prepayment Period (other than a
Principal Prepayment in full resulting from the purchase of a Mortgage Loan
pursuant to Section 2.02, 2.03, 3.24 or 10.01 hereof), the amount, if any,
by which (i) one month’s interest at the applicable Net Mortgage Rate on the
Stated Principal Balance of such Mortgage Loan immediately prior to such
prepayment exceeds (ii) the amount of interest paid or collected in connection
with such Principal Prepayment less interest on the Mortgage Loan for the period
up to the date of prepayment at the Expense Fee Rate.
Prepayment
Period:
With
respect to any Distribution Date and (i) Ocwen, the 16th day of the immediately
preceding calendar month (or with respect to the first Prepayment Period, the
Closing Date) through the 15th day of the calendar month in which such
Distribution Date occurs with respect to Principal Prepayments in full and
the
calendar month immediately preceding the calendar month in which such
Distribution Date occurs with respect to Principal Prepayments in part, (ii)
Equity One, the 16th day of the immediately preceding calendar month (or with
respect to the first Prepayment Period, the Closing Date) through the 15th
day
of the month in which the Distribution Date occurs, (iii) Xxxxx Fargo, the
calendar month preceding the calendar month in which such Distribution Date
occurs and (iv) SPS, the 16th day of the immediately preceding calendar month
(or with respect to the first Prepayment Period, the Closing Date) through
the
15th day of the month in which the Distribution Date occurs with respect to
Principal Prepayments in full and the related Due Period with respect to
Principal Prepayments in part.
Principal
Payment Amount:
With
respect to each Distribution Date, the Principal Remittance Amount for such
date
minus the Overcollateralization Release Amount, if any, for such Distribution
Date.
Principal
Prepayment:
Any
Mortgagor payment or other recovery of (or proceeds with respect to) principal
on a Mortgage Loan (including Mortgage Loans purchased or repurchased under
Sections 2.02, 2.03, 3.26 and 10.01 hereof) that is received in advance of
its
scheduled Due Date and is not accompanied by an amount as to interest
representing scheduled interest due on any Due Date in any month or months
subsequent to the month of prepayment. Partial Principal Prepayments shall
be
applied by the related Servicer in accordance with the terms of the related
Mortgage Note.
Principal
Remittance Amount:
With
respect to any Distribution Date and each Loan Group, (i) the sum, without
duplication, of (a) the principal portion of all Scheduled Payments on the
related Mortgage Loans due during the related Due Period whether or not received
on or prior to the related Determination Date, (b) the principal portion of
all
unscheduled collections (other than Payaheads) including Insurance Proceeds,
Condemnation Proceeds, Liquidation Proceeds, Subsequent Recoveries and all
full
and partial Principal Prepayments exclusive of Prepayment Charges or penalties
collected during the related Prepayment Period, to the extent applied as
recoveries of principal on the related Mortgage Loans, (c) the Stated Principal
Balance of each related Mortgage Loan that was repurchased by the Sponsor during
the related Prepayment Period pursuant to Sections 2.02, 2.03 and 3.24, (d)
the aggregate of all Substitution Adjustment Amounts received during the related
Prepayment Period for the related Determination Date in connection with the
substitution of Mortgage Loans in the related Loan Group pursuant to
Section 2.03(c), (e) amounts in respect of principal on the related
Mortgage Loans paid by the Master Servicer pursuant to Section 10.01 and
(f) the principal portion of Payaheads previously received on the Mortgage
Loans
and intended for application in the related Due Period, minus (ii) all amounts
required to be reimbursed by the Trust pursuant to Sections 4.02 and 9.05
or as otherwise set forth in this Agreement or the Custodial Agreement and
to
the extent not reimbursed from the Interest Remittance Amount for
such
Distribution Date,
allocated to the respective Loan Group on a pro rata basis, based on the
Aggregate Loan Group Balance as of the last day of the related Due Period,
to
the extent such amounts are attributable to both Loan Groups, and otherwise
allocated to the Loan Group to which such amount are attributable.
Private
Certificate:
Each of
the Class B-1 Certificates,
Class X
Certificates, Class P Certificates and Residual Certificates.
Prospectus
Supplement:
The
Prospectus Supplement dated January 30, 2007 relating to the offering of the
Publicly Offered Certificates.
Publicly
Offered Certificates:
Any
Certificates other than the Private Certificates.
PUD:
A
planned unit development.
Purchase
Price:
With
respect to any Mortgage Loan required to be repurchased by the Sponsor pursuant
to Section 2.02, 2.03 or elected to be repurchased by the Sponsor pursuant
to Section 3.24 hereof, and as confirmed by an Officer’s Certificate from the
Sponsor to the Trustee, an amount equal to the sum of (i) 100% of the
outstanding principal balance of the Mortgage Loan as of the date of such
purchase plus, (ii) 30 days’ accrued interest thereon at the applicable Net
Mortgage Rate, plus any portion of the Servicing Fee, Master Servicing Fee,
Servicing Advances and Advances payable to the related Servicer or Master
Servicer, as applicable, with respect to such Mortgage Loan plus (iii) any
costs
and damages of the Trust Fund in connection with any violation by such Mortgage
Loan of any abusive or predatory lending law, including any expenses incurred
by
the Trustee with respect to such Mortgage Loan prior to the purchase
thereof.
Rating
Agency:
Each of
Xxxxx’x, S&P and DBRS. If any such organization or its successor is no
longer in existence, “Rating Agency” shall be a nationally recognized
statistical rating organization, or other comparable Person, designated by
the
Depositor, notice of which designation shall be given to the Trustee. References
herein to a given rating category of a Rating Agency shall mean such rating
category without giving effect to any modifiers.
Realized
Loss:
With
respect to each Mortgage Loan as to which a Final Recovery Determination has
been made, an amount (not less than zero) equal to (i) the Stated Principal
Balance of such Mortgage Loan as of the commencement of the calendar month
in
which the Final Recovery Determination was made, plus (ii) accrued interest
from
the Due Date as to which interest was last paid by the Mortgagor through the
end
of the calendar month in which such Final Recovery Determination was made,
calculated in the case of each calendar month during such period (A) at an
annual rate equal to the annual rate at which interest was then accruing on
such
Mortgage Loan and (B) on a principal amount equal to the Stated Principal
Balance of such Mortgage Loan as of the close of business on the Distribution
Date during such calendar month, minus (iii) the proceeds, if any, received
in
respect of such Mortgage Loan during the calendar month in which such Final
Recovery Determination was made, net of amounts that are payable therefrom
to
the related Servicer pursuant to this Agreement or the Servicing Agreement,
as
applicable. To the extent that a Servicer receives Subsequent Recoveries with
respect to any Mortgage Loan in excess of the related amount owed to such
Servicer, the amount of the Realized Loss with respect to that Mortgage Loan
will be reduced to the extent that Subsequent Recoveries are applied to reduce
the Certificate Principal Balance of any Class of Certificates on any
Distribution Date.
With
respect to any REO Property as to which a Final Recovery Determination has
been
made, an amount (not less than zero) equal to (i) the Stated Principal Balance
of the related Mortgage Loan as of the date of acquisition of such REO Property
on behalf of REMIC I, plus (ii) accrued interest from the Due Date as to which
interest was last paid by the Mortgagor in respect of the related Mortgage
Loan
through the end of the calendar month immediately preceding the calendar month
in which such REO Property was acquired, calculated in the case of each calendar
month during such period (A) at an annual rate equal to the annual rate at
which
interest was then accruing on the related Mortgage Loan and (B) on a principal
amount equal to the Stated Principal Balance of the related Mortgage Loan as
of
the close of business on the Distribution Date during such calendar month,
minus
(iii) the aggregate of all unreimbursed Advances and Servicing
Advances.
With
respect to each Mortgage Loan which has become the subject of a Deficient
Valuation, the difference between the principal balance of the Mortgage Loan
outstanding immediately prior to such Deficient Valuation and the principal
balance of the Mortgage Loan as reduced by the Deficient Valuation.
With
respect to each Mortgage Loan which has become the subject of a Debt Service
Reduction, the portion, if any, of the reduction in each affected Monthly
Payment attributable to a reduction in the Mortgage Rate imposed by a court
of
competent jurisdiction. Each such Realized Loss shall be deemed to have been
incurred on the Due Date for each affected Monthly Payment.
In
addition, to the extent a Servicer receives Subsequent Recoveries with respect
to any Mortgage Loan, the amount of the Realized Loss with respect to that
Mortgage Loan will be reduced to the extent such Subsequent Recoveries are
applied to reduce the Certificate Principal Balance of any Class of Certificates
on any Distribution Date.
Record
Date:
With
respect to the Senior Certificates and Subordinate Certificates and any
Distribution Date, so long as such Certificates are Book-Entry Certificates,
the
Business Day preceding such Distribution Date, and otherwise, the close of
business on the last Business Day of the month preceding the month in which
such
Distribution Date occurs. With respect to the Class X, Class P and Residual
Certificates and any Distribution Date, the close of business on the last
Business Day of the month preceding the month in which such Distribution Date
occurs.
Reference
Bank Rate:
With
respect to any Accrual Period, the arithmetic mean, rounded upwards, if
necessary, to the nearest whole multiple of 0.03125%, of the offered rates
for
United States dollar deposits for one month that are quoted by the Reference
Banks as of 11:00 a.m., New York City time, on the related Interest
Determination Date to prime banks in the London interbank market for a period
of
one month in an amount approximately equal to the aggregate Certificate
Principal Balance of the Senior Certificates and Subordinate Certificates for
such Accrual Period, provided that at least two such Reference Banks provide
such rate. If fewer than two offered rates appear, the Reference Bank Rate
will
be the arithmetic mean, rounded upwards, if necessary, to the nearest whole
multiple of 0.03125%, of the rates quoted by one or more major banks in New
York
City, selected by the Securities Administrator, as of 11:00 a.m., New York
City
time, on such date for loans in United States dollars to leading European banks
for a period of one month in amounts approximately equal to the aggregate
Certificate Principal Balance of the Senior Certificates and Subordinate
Certificates for such Accrual Period.
Reference
Banks:
Shall
mean leading banks selected by the Securities Administrator and engaged in
transactions in Eurodollar deposits in the international Eurocurrency market
(i)
with an established place of business in London, (ii) which have been designated
as such by the Securities Administrator and (iii) which are not controlling,
controlled by, or under common control with, the Depositor, the Sponsor or
the
Servicer.
Regular
Certificate:
Any
Certificate other than a Residual Certificate.
Regulation
AB:
Means
Subpart 229.1100 - Asset Backed Securities (Regulation AB), 17 C.F.R.
§§229.1100-229.1123, as such may be amended from time to time, and subject to
such clarification and interpretation as have been provided by the Commission
in
the adopting release (Asset-Backed Securities, Securities Act Release No.
33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the staff of the
Commission, or as may be provided by the Commission or its staff from time
to
time.
Relevant
Servicing Criteria:
Means
with respect to any Servicing Function Participant, the Servicing Criteria
applicable to such party, as set forth on Exhibit
L
attached
hereto. For clarification purposes, multiple parties can have responsibility
for
the same Relevant Servicing Criteria. With respect to a Servicing Function
Participant engaged by the Master Servicer, the Securities Administrator or
the
Servicer, the term “Relevant Servicing Criteria” may refer to a portion of the
Relevant Servicing Criteria applicable to such party.
Relief
Act:
The
Servicemembers Civil Relief Act of 2003, as amended from time to time or similar
state or local laws.
REMIC:
A “real
estate mortgage investment conduit” within the meaning of Section 860D of
the Code.
REMIC
I:
The
segregated pool of assets subject hereto, constituting the primary trust created
hereby and to be administered hereunder, with respect to which a REMIC election
is to be made, consisting of (i) the Mortgage Loans and all interest accruing
and principal due with respect thereto after the Cut-off Date to the extent
not
applied in computing the Cut-off Date Principal Balance thereof and all related
Prepayment Charges; (ii) the related Mortgage Files, (iii) the
Custodial Accounts (other than any amounts representing any Servicer Prepayment
Charge Payment Amount), the Distribution Account, the Class P Certificate
Account and such assets that are deposited therein from time to time, together
with any and all income, proceeds and payments with respect thereto; (iv)
property that secured a Mortgage Loan and has been acquired by foreclosure,
deed
in lieu of foreclosure or otherwise; (v) the mortgagee’s rights under the
Insurance Policies with respect to the Mortgage Loans; (vi) the rights under
the
Mortgage Loan Purchase Agreement, and (vii) all proceeds of the foregoing,
including proceeds of conversion, voluntary or involuntary, of any of the
foregoing into cash or other liquid property. Notwithstanding
the foregoing, however, REMIC I specifically excludes (i) all payments and
other
collections of principal and interest due on the Mortgage Loans on or before
the
Cut-off Date, (ii) all Prepayment Charges payable in connection with Principal
Prepayments on the Mortgage Loans made before the Cut-off Date, (iii) the Basis
Risk Cap Agreement, (iv) the Basis Risk Shortfall Reserve Fund, (v) the Swap
Agreement, (vi) the Supplemental Interest Trust, and (vii) the Interest Rate
Cap
Agreement.
REMIC
I Regular Interest:
Any of
the separate non-certificated beneficial ownership interests in REMIC I issued
hereunder and designated as a “regular interest” in REMIC I. Each REMIC I
Regular Interest shall accrue interest at the related Uncertificated REMIC
I
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto. The designations for the respective
REMIC I Regular Interests are set forth in the Preliminary Statement hereto.
The
REMIC I Regular Interests consist of the REMIC I Group I Regular Interests,
REMIC I Group II Regular Interests and REMIC I Regular Interest X.
XXXXX
XX:
The
segregated pool of assets consisting of all of the REMIC I Regular Interests
conveyed in trust to the Trustee, for the benefit of the Holders of the REMIC
II
Regular Interests and the Holders of the Class R (as holders of the Class R-II
Interest), pursuant to Article II hereunder, and all amounts deposited therein,
with respect to which a separate REMIC election is to be made.
REMIC
II Interest Loss Allocation Amount:
With
respect to any Distribution Date, an amount equal to (a) the product of (i)
the
aggregate Stated Principal Balance of the Mortgage Loans and REO Properties
then
outstanding and (ii) the Uncertificated REMIC II Pass-Through Rate for REMIC
II
Regular Interest LT-AA minus the Marker Rate, divided by (b) 12.
REMIC
II Overcollateralization Amount:
With
respect to any date of determination, (i) 1.00% of the aggregate Uncertificated
Principal Balances of the REMIC II Regular Interests minus (ii) the aggregate
of
the Uncertificated Principal Balances of REMIC II Regular Interest LT-IA1,
REMIC
II Regular Interest LT-IIA1, REMIC II Regular Interest LT-IIA2, REMIC II Regular
Interest LT-IIA3, REMIC II Regular Interest LT-IIA4, REMIC II Regular Interest
LT-M1, REMIC II Regular Interest LT-M2, REMIC II Regular Interest LT-M3, REMIC
II Regular Interest LT-M4, REMIC II Regular Interest LT-M5, REMIC II Regular
Interest LT-M6, REMIC II Regular Interest LT-M7, REMIC II Regular Interest
LT-M8, REMIC II Regular Interest LT-M9, REMIC II Regular Interest LT-B1 and
REMIC II Regular Interest LT-P, in each case as of such date of
determination.
REMIC
II Principal Loss Allocation Amount:
With
respect to any Distribution Date, an amount equal to (a) the product of (i)
0.50% of the aggregate Stated Principal Balance of the Mortgage Loans and REO
Properties then outstanding and (ii) 1 minus a fraction, the numerator of which
is two times the aggregate of the Uncertificated Principal Balances of REMIC
II
Regular Interest LT-IA1, REMIC II Regular Interest LT-IIA1, REMIC II Regular
Interest LT-IIA2, REMIC II Regular Interest LT-IIA3, REMIC II Regular Interest
LT-IIA4, REMIC II Regular Interest LT-M1, REMIC II Regular Interest LT-M2,
REMIC
II Regular Interest LT-M3, REMIC II Regular Interest LT-M4, REMIC II Regular
Interest LT-M5, REMIC II Regular Interest LT-M6, REMIC II Regular Interest
LT-M7, REMIC II Regular Interest LT-M8, REMIC II Regular Interest LT-M9 and
REMIC II Regular Interest LT-B1 and the denominator of which is the aggregate
of
the Uncertificated Principal Balances of REMIC II Regular Interest LT-IA1,
REMIC
II Regular Interest LT-IIA2, REMIC II Regular Interest LT-IIA3, REMIC II Regular
Interest LT-IIA4, REMIC II Regular Interest LT-M1, REMIC II Regular Interest
LT-M2, REMIC II Regular Interest LT-M3, REMIC II Regular Interest LT-M4, REMIC
II Regular Interest LT-M5, REMIC II Regular Interest LT-M6, REMIC II Regular
Interest LT-M7, REMIC II Regular Interest LT-M8, REMIC II Regular Interest
LT-M9, REMIC II Regular Interest LT-B1 and REMIC II Regular Interest
LT-ZZ.
REMIC
II Regular Interests:
REMIC
II Regular Interest LT-AA, REMIC II Regular Interest LT-IA1, REMIC II Regular
Interest LT-IIA1, REMIC II Regular Interest LT-IIA2, REMIC II Regular Interest
LT-IIA3, REMIC II Regular Interest LT-IIA4, REMIC II Regular Interest LT-M1,
REMIC II Regular Interest LT-M2, REMIC II Regular Interest LT-M3, REMIC II
Regular Interest LT-M4, REMIC II Regular Interest LT-M5, REMIC II Regular
Interest LT-M6, REMIC II Regular Interest LT-M7, REMIC II Regular Interest
LT-M8, REMIC II Regular Interest LT-M9, REMIC II Regular Interest LT-B1, REMIC
II Regular Interest LT-ZZ, REMIC II Regular Interest LT-P and REMIC II Regular
Interest LT-IO.
REMIC
II Regular Interest LT-AA:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-AA shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-IA1:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-IA1 shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-IIA1:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-IIA1
shall
accrue interest at the related Uncertificated REMIC II Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
REMIC
II Regular Interest LT-IIA2:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-IIA2 shall accrue interest at the related Uncertificated REMIC
II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-IIA3:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-IIA3 shall accrue interest at the related Uncertificated REMIC
II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-IIA4:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-IIA4 shall accrue interest at the related Uncertificated REMIC
II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-B1:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-B1 shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-IO:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-IO shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, subject to the terms and
conditions hereof.
REMIC
II Regular Interest LT-M1:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-M1 shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-M2:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-M2 shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-M3:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-M3 shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-M4:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-M4 shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-M5:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-M5 shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-M6:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-M6 shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-M7:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-M7 shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-M8:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-M8 shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-M9:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-M9 shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-P:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-P shall be entitled to distributions of principal, subject to the
terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.
REMIC
II Regular Interest LT-ZZ:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-ZZ shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-ZZ Maximum Interest Deferral Amount:
With
respect to any Distribution Date, the excess of (i) accrued interest at the
Uncertificated REMIC II Pass-Through Rate applicable to REMIC II Regular
Interest LT-ZZ for such Distribution Date on a balance equal to the
Uncertificated Principal Balance of REMIC II Regular Interest LT-ZZ minus the
REMIC II Overcollateralization Amount, in each case for such Distribution Date,
over (ii) the Uncertificated Accrued Interest on REMIC II Regular Interest
LT-IA1, REMIC II Regular Interest LT-IIA1, REMIC II Regular Interest LT-IIA2,
REMIC II Regular Interest LT-IIA3, REMIC II Regular Interest LT-IIA4, REMIC
II
Regular Interest LT-M1, REMIC II Regular Interest LT-M2, REMIC II Regular
Interest LT-M3, REMIC II Regular Interest LT-M4, REMIC II Regular Interest
LT-M5, REMIC II Regular Interest LT-M6, REMIC II Regular Interest LT-M7, REMIC
II Regular Interest LT-M8, REMIC II Regular Interest LT-M9 and REMIC II Regular
Interest LT-B1 for such Distribution Date, with the rate on each such REMIC
II
Regular Interest subject to a cap equal to the related Pass-Through
Rate.
REMIC
II Targeted Overcollateralization Amount:
1.00%
of the Targeted Overcollateralization Amount.
REMIC
III:
The
segregated pool of assets consisting of all of the REMIC II Regular Interests
conveyed in trust to the Trustee, for the benefit of the REMIC III
Certificateholders pursuant to Section 2.07, and all amounts deposited
therein, with respect to which a separate REMIC election is to be
made.
REMIC
III Certificate:
Any
Regular Certificate, other than a Class X Certificate or Class P Certificate,
or
Class R Certificate.
REMIC
III Certificateholder:
The
Holder of any REMIC III Certificate.
REMIC
III Regular Interest:
Any of
the Class X Interest, Class P Interest, Class IO Interest, and any “regular
interest” in REMIC III the ownership of which is represented by a Senior
Certificate or Subordinate Certificate.
REMIC
IV:
The
segregated pool of assets consisting of all the Class X Interest conveyed in
trust to the Trustee, for the benefit of the Holders of the Regular Certificates
and the Class R-X Certificate (in respect of the Class R-IV Interest), pursuant
to Section 2.07 hereunder, and all amounts deposited therein, with respect
to
which a separate REMIC election is to be made.
REMIC
V:
The
segregated pool of assets consisting of all of the Class P Interest conveyed
in
trust to the Trustee, for the benefit of the Holders of the Class P Certificates
and the Holders of the Class R-X Certificate (in respect of the Class R-V
Interest), pursuant to Section 2.07 hereunder, and all amounts deposited
therein, with respect to which a separate REMIC election is to be
made.
REMIC
VI:
The
segregated pool of assets consisting of all of the Class IO Interest conveyed
in
trust to the Trustee, for the benefit of the Holders of REMIC VI Regular
Interest IO and the Holders of the Class R-X Certificate (in respect of the
Class R-VI Interest), pursuant to Section 2.07, and all amounts deposited
therein, with respect to which a separate REMIC election is to be
made.
REMIC
VI Regular Interest IO:
An
uncertificated interest in the Trust Fund held by the Trustee, evidencing a
Regular Interest in REMIC VI for purposes of the REMIC Provisions.
REMIC
Opinion:
Shall
mean an Opinion of Counsel to the effect that the proposed action will not
have
an adverse affect on any REMIC created hereunder.
REMIC
Provisions:
Provisions of the federal income tax law relating to real estate mortgage
investment conduits, which appear at Sections 860A through 860G of Subchapter
M
of Chapter 1 of the Code, and related provisions, and proposed, temporary and
final regulations and published rulings, notices and announcements promulgated
thereunder, as the foregoing may be in effect from time to time as well as
provisions of applicable state laws.
REMIC
Regular Interest:
Any
REMIC I Regular Interest, REMIC II Regular Interest, Regular Certificate or
Class IO Interest.
Remittance
Date:
Shall
mean (a) with respect to Ocwen, SPS and Equity One (or any successor to any
such
Servicer) not later than 3:00 p.m. Eastern Time on the twenty-third (23rd)
day
of the month and if such day is not a Business Day, the immediately preceding
Business Day and (b) with respect to Xxxxx Fargo, the eighteenth (18th)
day of
the month and if such day is not a Business Day, the immediately following
Business Day.
REO
Property:
A
Mortgaged Property acquired by the related Servicer through foreclosure or
deed-in-lieu of foreclosure in connection with a defaulted Mortgage
Loan.
Replacement
Mortgage Loan:
A
Mortgage Loan or Mortgage Loans in the aggregate substituted by the Sponsor
for
a Deleted Mortgage Loan, which must, on the date of such substitution, as
confirmed in a request for release in accordance with the terms of the Custodial
Agreement, (i) have a Stated Principal Balance, after deduction of the principal
portion of the Scheduled Payment due in the month of substitution, not in excess
of, and not less than 90% of, the Stated Principal Balance of the Deleted
Mortgage Loan; (ii) have an adjustable Mortgage Rate not less than or more
than
1% per annum higher than the Mortgage Rate of the Deleted Mortgage Loan; (iii)
have the same or higher credit quality characteristics than that of the Deleted
Mortgage Loan; (iv) have a Loan-to-Value Ratio or Combined Loan-to-Value Ratio
no higher than that of the Deleted Mortgage Loan; (v) have a remaining term
to
maturity no greater than (and not more than one year less than) that of the
Deleted Mortgage Loan; (vi) have the same lien priority as the Deleted Mortgage
Loan; (vii) constitute the same occupancy type as the Deleted Mortgage Loan
or
be owner occupied; (viii) have a Maximum Mortgage Interest Rate not less than
the Maximum Mortgage Interest Rate on the Deleted Loan; (ix) have a Minimum
Mortgage Interest Rate not less than the Minimum Mortgage Interest Rate of
the
Deleted Loan, if applicable; (x) have a Gross Margin equal to the Gross Margin
of the Deleted Loan; (xi) have a next Adjustment Date not more than two months
later than the next Adjustment Date on the Deleted Loan, if applicable; and
(xii) comply with each representation and warranty set forth in the Mortgage
Loan Purchase Agreement.
Reportable
Event:
Has the
meaning set forth in Section 5.14(c) of this Agreement.
Reporting
Party:
Any
Servicer, the Master Servicer, the Securities Administrator, the Custodian
under
the Custodial Agreement, and any Servicing Function Participant engaged by
such
parties.
Required
Insurance Policy:
With
respect to any Mortgage Loan, any insurance policy that is required to be
maintained from time to time under this Agreement.
Residual
Certificates:
The
Class R Certificates and the Class R-X Certificates.
Responsible
Officer:
With
respect to the Trustee and the Securities Administrator, any Vice President,
any
Assistant Vice President, the Secretary, any Assistant Secretary, any Trust
Officer, any other officer customarily performing functions similar to those
performed by any of the above designated officers or other officers of the
Trustee or the Securities Administrator specified by the Trustee or the
Securities Administrator, as the case may be, having direct responsibility
over
this Agreement and customarily performing functions similar to those performed
by any one of the designated officers, as to whom, with respect to a particular
matter, such matter is referred because of such officer’s knowledge of and
familiarity with the particular subject.
Responsible
Party:
The
party indicated on Exhibit N as the entity primarily responsible for reporting
the information set forth therein to the Securities Administrator pursuant
to
Section 5.14.
S&P:
Standard & Poor’s, a division of The XxXxxx-Xxxx Companies, Inc. or its
successor in interest.
Xxxxxxxx-Xxxxx
Act:
Means
the Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations of the Commission
promulgated thereunder (including any interpretations thereof by the
Commission’s staff).
Xxxxxxxx-Xxxxx
Certification:
A
written certification signed by an officer of the Master Servicer that complies
with (i) the Xxxxxxxx-Xxxxx Act of 2002, as amended from time to time, and
(ii)
Exchange Act Rules 13a-14(d) and 15d-14(d), as in effect from time to time;
provided that if, after the Closing Date (a) the Xxxxxxxx-Xxxxx Act of 2002
is
amended, (b) the Rules referred to in clause (ii) are modified or superseded
by
any subsequent statement, rule or regulation of the Commission or any statement
of a division thereof, or (c) any future releases, rules and regulations are
published by the Commission from time to time pursuant to the Xxxxxxxx-Xxxxx
Act
of 2002, which in any such case affects the form or substance of the required
certification and results in the required certification being, in the reasonable
judgment of the Master Servicer, materially more onerous than the form of the
required certification as of the Closing Date, the Xxxxxxxx-Xxxxx Certification
shall be as agreed to by the Master Servicer, the Depositor and the Sponsor
following a negotiation in good faith to determine how to comply with any such
new requirements.
Scheduled
Payment:
The
scheduled monthly payment on a Mortgage Loan due on any Due Date allocable
to
principal and/or interest on such Mortgage Loan.
Securities
Act:
The
Securities Act of 1933, as amended, and the rules and regulations promulgated
thereunder.
Securities
Administrator:
As of
the Closing Date, Xxxxx Fargo Bank, N.A. and thereafter, its respective
successors in interest that meet the qualifications of this Agreement. The
Securities Administrator and the Master Servicer shall at all times be the
same
Person or Affiliates.
Senior
Certificates:
The
Class I-A-1, Class II-A-1, Class II-A-2, Class II-A-3 and Class II-A-4
Certificates.
Senior
Enhancement Percentage:
With
respect to any Distribution Date will be the fraction, expressed as a
percentage, the numerator of which is the sum of the aggregate Certificate
Principal Balance of the Subordinate Certificates and the Overcollateralization
Amount, in each case after giving effect to payments on such Distribution Date
(assuming no Trigger Event is in effect), and the denominator of which is the
Aggregate Loan Balance for such Distribution Date (after giving effect to
scheduled payments of principal due during the related Due Period to the extent
received or advanced, unscheduled collections of principal received during
the
related Prepayment Period and after reduction for Realized Losses on the
Mortgage Loans incurred during the related Due Period).
Senior
Principal Payment Amount:
With
respect to any Distribution Date on or after the Stepdown Date and as long
as a
Trigger Event is not in effect with respect to such Distribution Date, the
amount, if any, by which (x) the Certificate Principal Balances of the Senior
Certificates, in each case, immediately prior to such Distribution Date exceed
(y) the lesser of (A) the product of (i) 49.00% and (ii) the Aggregate Loan
Balance for such Distribution Date (after giving effect to scheduled payments
of
principal due during the related Due Period to the extent received or advanced,
unscheduled collections of principal received during the related Prepayment
Period and after reduction for Realized Losses on the Mortgage Loans incurred
during the related Due Period) and (B) the amount, if any, by which (i) the
Aggregate Loan Balance for such Distribution Date (after giving effect to
scheduled payments of principal due during the related Due Period to the extent
received or advanced, unscheduled collections of principal received during
the
related Prepayment Period and after reduction for Realized Losses on the
Mortgage Loans incurred during the related Due Period) exceeds (ii) 0.50% of
the
Aggregate Loan Balance as of the Cut-off Date.
Service(s)(ing):
In
accordance with Regulation AB, the act of servicing and administering the
Mortgage Loans or any other assets of the Trust Fund by an entity that meets
the
definition of “servicer” set forth in Item 1101 of Regulation AB and is subject
to the disclosure requirements set forth in 1108 of Regulation AB. For
clarification purposes, any uncapitalized occurrence of this term shall have
the
meaning commonly understood by participants in the residential mortgage-backed
securitization market.
Servicer:
Shall
mean Ocwen, Equity One, SPS, Xxxxx Fargo, or any successor thereto appointed
hereunder in connection with the servicing and administration of the related
Mortgage Loans.
Servicer
Default:
As
defined in Section 8.01.
Servicer
Prepayment Charge Payment Amount:
The
amount payable by a Servicer in respect of any waived Prepayment Charges
pursuant to Section 3.01 of this Agreement or pursuant to the Servicing
Agreement, as applicable.
Servicer’s
Assignee:
As
defined in Section 5.01(b)(ii).
Servicing
Advances:
All
customary, reasonable and necessary “out of pocket” costs and expenses
(including reasonable legal fees) incurred prior to, on or after the Cut-off
Date in the performance by a Servicer of its servicing obligations hereunder
or
under the Servicing Agreement, as applicable, including, but not limited to,
the
cost of (i) the preservation, restoration, inspection, valuation and protection
of a Mortgaged Property, (ii) any enforcement or judicial proceedings, including
foreclosures, and including any expenses incurred in relation to any such
proceedings that result from the Mortgage Loan being registered in the MERS®
System, (iii) the management and liquidation of any REO Property (including,
without limitation, realtor’s commissions), (iv) compliance with any obligations
under Section 3.07 hereof to cause insurance to be maintained, (v) payment
of taxes, (vi) obtaining broker price opinions, (vii) refunding to any mortgagor
such prepaid origination fees and/or finance charges that are subject to
reimbursement upon a principal prepayment of the related Mortgage Loan to the
extent such reimbursement is required by applicable law and (viii) obtaining
any
legal documentation required to be included in the Mortgage File and/or
correcting any outstanding title issues (i.e., any lien or encumbrance on the
Mortgaged Property that prevents the effective enforcement of the intended
lien
position) reasonably necessary for a Servicer to perform its obligations under
this Agreement or the Servicing Agreement, as applicable. Servicing Advances
also include any reasonable “out-of-pocket” cost and expenses (including legal
fees) incurred by a Servicer in connection with executing and recording
instruments of satisfaction, deeds of reconveyance or Assignments to the extent
not recovered from the Mortgagor or otherwise payable under this Agreement.
No
Servicer shall be required to make any Servicing Advances that would constitute
a Nonrecoverable Advance, provided that such Servicer delivers an Officer’s
Certificate to the Master Servicer and the Trustee certifying that such
Servicing Advance would constitute a Nonrecoverable Advance.
Servicing
Agreement:
The
Seller’s
Warranties and Servicing Agreement, dated as of March 1, 2006, between the
Sponsor and Xxxxx Fargo (as modified pursuant to the Assignment
Agreement).
Servicing
Criteria:
The
criteria set forth in paragraph (d) of Item 1122 of Regulation AB, as such
may
be amended from time to time.
Servicing
Fee:
As to
each Mortgage Loan and any Distribution Date, an amount equal to 1/12th of
the
Servicing Fee Rate multiplied by the Stated Principal Balance of such Mortgage
Loan as of the last day of the related Due Period or, in the event of any
payment of interest that accompanies a Principal Prepayment in full during
the
related Due Period made by the Mortgagor immediately prior to such prepayment,
interest at the Servicing Fee Rate on the same Stated Principal Balance of
such
Mortgage Loan used to calculate the payment of interest on such Mortgage
Loan.
Servicing
Fee Rate:
0.50%
per annum.
Servicing
Function Participant:
Any
Subservicer or Subcontractor of a Servicer, the Master Servicer and the
Securities Administrator or the Custodian, respectively but not including any
vendor or other Person as to which the party engaging such vendor or other
Person takes responsibility for such vendor’s or other Person’s reporting
obligations pursuant to section 17.06 of the SEC Division of Corporate Finance
Manual of Publicly Available Telephone Interpretations related to Regulation
AB
and related rules. For purposes of Section 5.14(e), such term also shall include
the Servicers, the Master Servicer, the Securities Administrator and the
Custodian.
Servicing
Officer:
Any
officer of a Servicer or the Master Servicer, as applicable, involved in, or
responsible for, the administration and the servicing of Mortgage Loans, whose
name and specimen signature appear on a list of Servicing Officers furnished
by
the Servicer or the Master Servicer, as applicable, to the Master Servicer,
Securities Administrator, the Trustee and the Depositor on the Closing Date,
as
such list may from time to time be amended.
Six-Month
LIBOR:
The per
annum rate equal to the average of interbank offered rates for Six-Month U.S.
dollar-denominated deposits in the London market based on quotations of major
banks as published in The Wall Street Journal and most recently available as
of
the time specified in the related Mortgage Note.
Sponsor:
Nomura
Credit & Capital, Inc., a Delaware corporation, and its successors and
assigns, in its capacity as seller of the Mortgage Loans to the
Depositor.
SPS:
Select
Portfolio Servicing, Inc., and any successor thereto appointed under this
Agreement in connection with the servicing and administration of the SPS
Mortgage Loans.
SPS
Mortgage Loans:
Those
Mortgage Loans serviced by SPS pursuant to the terms and provisions of this
Agreement and identified as such on the Mortgage Loan Schedule.
Startup
Day:
The
Startup Day for each REMIC formed hereunder shall be the Closing
Date.
Stated
Principal Balance:
With
respect to any Mortgage Loan or related REO Property and any Distribution Date,
the Cut-off Date Principal Balance thereof minus the sum of (i) the principal
portion of the Scheduled Payments due with respect to such Mortgage Loan during
each Due Period ending prior to such Distribution Date (and irrespective of
any
delinquency in their payment), (ii) all Principal Prepayments with respect
to
such Mortgage Loan received prior to or during the related Prepayment Period,
and all Liquidation Proceeds to the extent applied by the related Servicer
as
recoveries of principal in accordance with Section 3.09 of this Agreement
or pursuant to the Servicing Agreement, as applicable, with respect to such
Mortgage Loan, that were received by the related Servicer as of the close of
business on the last day of the Prepayment Period related to such Distribution
Date and (iii) any Realized Losses on such Mortgage Loan incurred during the
related Prepayment Period. The Stated Principal Balance of a Liquidated Loan
equals zero.
Stepdown
Date:
The
later to occur of (x) the Distribution Date in February 2010 and (y) the first
Distribution Date on which the Senior Enhancement Percentage (calculated for
this purpose only after taking into account distributions of principal on the
Mortgage Loans, but prior to any distributions to the holders of the Senior
Certificates and the Subordinate Certificates on such Distribution Date) is
greater than or equal to 51.00%.
Subcontractor:
Any
vendor, subcontractor or other Person who is not responsible for the overall
servicing of Mortgage Loans but performs one or more discrete functions
identified in Item 1122(d) of Regulation AB with respect to any Mortgage Loans
under the direction or authority of a Servicer (or a Subservicer of the
Servicer), the Master Servicer, the Trustee, the Custodian or the Securities
Administrator and is determined by the Person engaging such vendor,
subcontractor or other Person to be “participating in the servicing function”
within the meaning of Item 1122 of Regulation AB.
Subordinate
Certificates:
Shall
mean, collectively, the Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5,
Class M-6, Class M-7, Class M-8, Class M-9 and Class B-1
Certificates.
Subsequent
Recoveries:
All
amounts received during the related Prepayment Period by the related Servicer
specifically related to a defaulted Mortgage Loan or disposition of an REO
Property prior to the related Prepayment Period that resulted in a Realized
Loss, after the liquidation or disposition of such defaulted Mortgage
Loan.
Subservicer:
Any
Person who is identified in Item 1122(d) of Regulation AB that services the
related Mortgage Loans on behalf of a Servicer or is engaged by the Master
Servicer, the Securities Administrator or the Custodian and is responsible
for
the performance (whether directly or through subservicers or Subcontractors)
of
a substantial portion of the material servicing functions required to be
performed by such Person under this Agreement or any subservicing agreement.
The
initial subservicer for the Equity One Mortgage Loans shall be Popular Mortgage
Servicing, Inc., an affiliate of Equity One.
Subservicing
Agreement:
Any
agreement entered into between a Servicer and a Subservicer with respect to
the
subservicing of any Mortgage Loan by such Subservicer subject to Section 3.03
of
this Agreement or the Servicing Agreement, as applicable.
Substitution
Adjustment Amount:
As
defined in Section 2.03(c).
Successor
Servicer:
The
Master Servicer or any successor to a Servicer appointed pursuant to
Section 8.02 of this Agreement after the occurrence of a Servicer Default
or upon the resignation of a Servicer pursuant to this Agreement or pursuant
to
the Servicing Agreement, as applicable.
Supplemental
Interest Trust:
The
corpus of a trust created pursuant to Section 5.12 of this Agreement and
designated as the “Supplemental Interest Trust,” consisting of the Basis Risk
Cap Agreement, the Swap Agreement, the Interest Rate Cap Agreement, the Class
IO
Interest and the right to receive payments in respect of the Class IO
Distribution Amount. For the avoidance of doubt, the Supplemental Interest
Trust
does not constitute a part of the Trust Fund.
Supplemental
Interest Trust Trustee:
HSBC
Bank
USA, National Association, as trustee on behalf of the Supplemental Interest
Trust.
Swap
Agreement:
The
interest rate swap agreement, dated as of January 31, 2007, between the
Supplemental Interest Trust Trustee and the Swap Provider, including any
schedule, confirmations, credit support annex or other credit support document
relating thereto, and attached hereto as Exhibit Q.
Swap
Credit Support Annex:
The
credit support annex, dated as of January 31, 2007, between the Supplemental
Interest Trust Trustee and the Swap Provider, which is annexed to and forms
part
of the Swap Agreement.
Swap
LIBOR:
LIBOR
as determined pursuant to the Swap Agreement.
Swap
Provider:
The
swap provider under the Swap Agreement either (a) entitled to receive payments
from the Supplemental Interest Trust or (b) required to make payments to the
Supplemental Interest Trust, in either case pursuant to the terms of the Swap
Agreement, and any successor in interest or assign. Initially, the Swap Provider
shall be HSBC Bank USA, National Association.
Swap
Provider Trigger Event:
A Swap
Provider Trigger Event shall have occurred if any of the following has occurred:
an Event of Default (under the Swap Agreement) with respect to which the Swap
Provider is a Defaulting Party, a Termination Event (under the Swap Agreement)
with respect to which the Swap Provider is the sole Affected Party or an
Additional Termination Event (under the Swap Agreement) with respect to which
the Swap Provider is the sole Affected Party.
Swap
Termination Payment:
Upon
the designation of an “Early Termination Date” as defined in the Swap Agreement,
the payment to be made by the Supplemental Interest Trust to the Swap Provider,
or by the Swap Provider to the Supplemental Interest Trust, as applicable,
pursuant to the terms of the Swap Agreement upon the occurrence of an early
termination.
Targeted
Overcollateralization Amount:
With
respect to any Distribution Date prior to the Stepdown Date, 3.75% of the
Aggregate Loan Balance as of the Cut-off Date; with respect to any Distribution
Date on or after the Stepdown Date and with respect to which a Trigger Event
is
not in effect, the greater of (a) 7.50% of the Aggregate Loan Balance for such
Distribution Date (after giving effect to scheduled payments of principal due
during the related Due Period to the extent received or advanced, unscheduled
collections of principal received during the related Prepayment Period and
after
reduction for Realized Losses on the Mortgage Loans incurred during the related
Due Period), or (b) 0.50% of the Aggregate Loan Balance as of the Cut-off Date;
with respect to any Distribution Date on or after the Stepdown Date with respect
to which a Trigger Event is in effect, the Targeted Overcollateralization Amount
for such Distribution Date will be equal to the Targeted Overcollateralization
Amount for the Distribution Date immediately preceding such Distribution Date.
Notwithstanding the foregoing, on and after any Distribution Date following
the
reduction of the aggregate Certificate Principal Balance of the Senior
Certificates and the Subordinate Certificates to zero, the Targeted
Overcollateralization Amount shall be zero.
Tax
Matters Person:
The
person designated as “tax matters person” in the manner provided under Treasury
regulation § 1.860F-4(d) and temporary Treasury regulation
§ 301.6231(a)(7)-1T. The holder of the greatest Percentage Interest in a
Class of Residual Certificates shall be the Tax Matters Person for the related
REMIC. The Securities Administrator, or any successor thereto or assignee
thereof shall serve as tax administrator hereunder and as agent for the related
Tax Matters Person.
Termination
Price:
The
price, calculated as set forth in Section 10.01, to be paid in connection
with the purchase of the Mortgage Loans pursuant to
Section 10.01.
Transaction
Party:
Shall
mean the Depositor, the Sponsor, the Trustee, the Servicers, the Master
Servicer, the Securities Administrator, the Custodian, the Basis Risk Cap
Provider, the Swap Provider and the Interest Rate Cap Provider.
Transfer
Affidavit:
As
defined in Section 6.02(c).
Transfer:
Any
direct or indirect transfer or sale of any Ownership Interest in a
Certificate.
Trigger
Event:
With
respect to any Distribution Date, a Trigger Event is in effect if either (i)
the
Delinquency Rate as of the last day of the related Due Period exceeds 31.37%
of
the Senior Enhancement Percentage for such Distribution Date or (ii) the
cumulative Realized Losses as a percentage of the original Aggregate Loan
Balance on the Closing Date for such Distribution Date is greater than the
percentage set forth in the following table:
|
Range
Of Distribution Dates
|
Cumulative
Loss
Percentage
|
|
|
February
2010 - January 2011
|
3.80%*
|
|
|
February
2011 - January 2012
|
5.95%*
|
|
|
February
2012 - January 2013
|
7.70%*
|
|
|
February
2013 - January 2014
|
8.65%*
|
|
|
February
2014 And Thereafter
|
8.70%*
|
*The
cumulative loss percentages set forth above are applicable to the first
Distribution Date in the corresponding range of Distribution Dates. The
cumulative loss percentage for each succeeding Distribution Date in a range
increases incrementally by 1/12 of the positive difference between the
percentage applicable
to the first Distribution Date in that range and the percentage applicable
to
the first Distribution
Date in the succeeding range.
Trust
Fund:
Collectively, the assets of REMIC I, REMIC II, REMIC III, REMIC IV, REMIC V,
REMIC VI and the Basis Risk Shortfall Reserve Fund. For the avoidance of doubt,
the Trust Fund does not include the Supplemental Interest Trust.
Trustee:
HSBC
Bank USA, National Association, a national banking association, not in its
individual capacity, but solely in its capacity as trustee for the benefit
of
the Certificateholders under this Agreement, and any successor thereto, and
any
corporation or national banking association resulting from or surviving any
consolidation or merger to which it or its successors may be a party and any
successor trustee as may from time to time be serving as successor trustee
hereunder.
Uncertificated
Accrued Interest:
With
respect to each Uncertificated REMIC Regular Interest on each Distribution
Date,
an amount equal to one month’s interest at the related Uncertificated
Pass-Through Rate on the Uncertificated Principal Balance of such REMIC Regular
Interest. In each case, Uncertificated Accrued Interest will be reduced by
any
Prepayment Interest Shortfalls and shortfalls resulting from application of
the
Relief Act (allocated to such REMIC Regular Interests as set forth in Sections
1.02 and 5.07).
Uncertificated
Notional Amount:
With
respect to the Class X Interest and any Distribution Date, an amount equal
to
the aggregate Uncertificated Principal Balance of the REMIC II Regular Interests
(other than REMIC II Regular Interest P) for such Distribution Date.
With
respect to REMIC II Regular Interest LT-IO and each Distribution Date listed
below, the aggregate Uncertificated Principal Balance of the REMIC 1 Regular
Interests ending with the designation “A” listed below:
|
Distribution
Date
|
REMIC
1 Regular Interests
|
|
|
1
-
7
|
I-1-A
through I-54-A
|
|
|
8
|
I-2-A
through X-00-X
|
|
|
0
|
X-0-X
xxxxxxx X-00-X
|
|
|
00
|
X-0-X
through X-00-X
|
|
|
00
|
X-0-X
xxxxxxx X-00-X
|
|
|
00
|
X-0-X
through X-00-X
|
|
|
00
|
X-0-X
through X-00-X
|
|
|
00
|
X-0-X
xxxxxxx X-00-X
|
|
|
00
|
X-0-X
through I-54-A
|
|
|
16
|
I-10-A
through I-54-A
|
|
|
17
|
I-11-A
through I-54-A
|
|
|
18
|
I-12-A
through I-54-A
|
|
|
19
|
I-13-A
through I-54-A
|
|
|
20
|
I-14-A
through I-54-A
|
|
|
21
|
I-15-A
through I-54-A
|
|
|
22
|
I-16-A
through I-54-A
|
|
|
23
|
I-17-A
through I-54-A
|
|
|
24
|
I-18-A
through I-54-A
|
|
|
25
|
I-19-A
through I-54-A
|
|
|
26
|
I-20-A
through I-54-A
|
|
|
27
|
I-21-A
through I-54-A
|
|
|
28
|
I-22-A
through I-54-A
|
|
|
29
|
I-23-A
through I-54-A
|
|
|
30
|
I-24-A
through I-54-A
|
|
|
31
|
I-25-A
through I-54-A
|
|
|
32
|
I-26-A
through I-54-A
|
|
|
33
|
I-27-A
through I-54-A
|
|
|
34
|
I-28-A
through I-54-A
|
|
|
35
|
I-29-A
through I-54-A
|
|
|
36
|
I-30-A
through I-54-A
|
|
|
37
|
I-31-A
through I-54-A
|
|
|
38
|
I-32-A
through I-54-A
|
|
|
39
|
I-33-A
through I-54-A
|
|
|
40
|
I-34-A
through I-54-A
|
|
|
41
|
I-35-A
through I-54-A
|
|
|
42
|
I-36-A
through I-54-A
|
|
|
43
|
I-37-A
through I-54-A
|
|
|
44
|
I-38-A
through I-54-A
|
|
|
45
|
I-39-A
through I-54-A
|
|
|
46
|
I-40-A
through I-54-A
|
|
|
47
|
I-41-A
through I-54-A
|
|
|
48
|
I-42-A
through I-54-A
|
|
|
49
|
I-43-A
through I-54-A
|
|
|
50
|
I-44-A
through I-54-A
|
|
|
51
|
I-45-A
through I-54-A
|
|
|
52
|
I-46-A
through I-54-A
|
|
|
53
|
I-47-A
through I-54-A
|
|
|
54
|
I-48-A
through I-54-A
|
|
|
55
|
I-49-A
through I-54-A
|
|
|
56
|
I-50-A
through I-54-A
|
|
|
57
|
I-51-A
through I-54-A
|
|
|
58
|
I-52-A
through I-54-A
|
|
|
59
|
I-53-A
and I-54-A
|
|
|
60
|
I-54-A
|
|
|
thereafter
|
$0.00
|
Uncertificated
Principal Balance:
With
respect to each REMIC Regular Interest (other than REMIC II Regular Interest
LT-IO), the principal amount of such REMIC Regular Interest outstanding as
of
any date of determination. As of the Closing Date, the Uncertificated Principal
Balance of each such REMIC Regular Interest shall equal the amount set forth
in
the Preliminary Statement hereto as its initial Uncertificated Principal
Balance. On each Distribution Date, the Uncertificated Principal Balance of
each
REMIC Regular Interest shall be reduced by all distributions of principal made
on such REMIC Regular Interest on such Distribution Date pursuant to Section
5.07 and, if and to the extent necessary and appropriate, shall be further
reduced on such Distribution Date by Realized Losses as provided in Section
5.07. The Uncertificated Principal Balance of each REMIC Regular Interest shall
never be less than zero.
Uncertificated
Pass-Through Rate:
The
Uncertificated REMIC I Pass-Through Rate or Uncertificated REMIC II Pass-Through
Rate.
Uncertificated
REMIC I Pass-Through Rate:
With
respect to REMIC I Regular Interest I, a per annum rate equal to the weighted
average Net Mortgage Rate of the
Mortgage Loans. With respect to each REMIC
I
Regular
Interest ending with the designation “A”, a per annum rate equal to the weighted
average Net Mortgage Rate of the
Mortgage Loans multiplied
by 2, subject to a maximum rate of 10.60%. With respect to each REMIC I Regular
Interest ending with the designation “B”, the greater of (x) a per annum rate
equal to the excess, if any, of (i) 2 multiplied by the weighted average Net
Mortgage Rate the
Mortgage Loans over (ii) 10.60% and (y) 0.00%.
Uncertificated
REMIC II Pass-Through Rate:
With
respect to REMIC II Regular Interest LT-AA, REMIC II Regular Interest
LT-IA1,
REMIC II Regular Interest LT-IIA1,
REMIC
II Regular Interest LT-IIA2,
REMIC
II Regular Interest LT-IIA3,
REMIC
II Regular Interest LT-IIA4,
REMIC
II Regular Interest LT-M1, REMIC II Regular Interest LT-M2, REMIC II Regular
Interest LT-M3, REMIC II Regular Interest LT-M4, REMIC II Regular Interest
LT-M5, REMIC II Regular Interest LT-M6, REMIC II Regular Interest LT-M7, REMIC
II Regular Interest LT-M8, REMIC II Regular Interest LT-M9, REMIC II Regular
Interest LT-B1 and REMIC II Regular Interest LT-ZZ,
a
per
annum rate (but not less than zero) equal to the weighted average of (w) with
respect to REMIC I Regular Interest I, the
Uncertificated REMIC I Pass-Through Rate for such REMIC I Regular Interest
for
each such Distribution Date, (x) with respect to REMIC I Regular Interests
ending with the designation “B”, the weighted average of the Uncertificated
REMIC I Pass-Through Rates for such REMIC I Regular Interests, weighted on
the
basis of the Uncertificated Principal Balance of such REMIC I Regular Interests
for each such Distribution Date and (y) with respect to REMIC I Regular
Interests ending with the designation “A”, for each Distribution Date listed
below, the weighted average of the rates listed below for each such REMIC I
Regular Interest listed below, weighted on the basis of the Uncertificated
Principal Balance of each such REMIC I Regular Interest for each such
Distribution Date:
|
Distribution
Date
|
REMIC
1 Regular Interest
|
Rate
|
||
|
1
-
6
|
I-1-A
through I-54-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
7
|
I-1-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
8
|
I-2-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
9
|
I-3-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
and I-2-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
10
|
I-4-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-3-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
11
|
I-5-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-4-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
12
|
I-6-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-5-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
13
|
I-7-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-6-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
14
|
I-8-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-7-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
15
|
I-9-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-8-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
16
|
I-10-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-9-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
17
|
I-11-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-10-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
18
|
I-12-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-11-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
19
|
I-13-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-12-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
20
|
I-14-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-13-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
21
|
I-15-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-14-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
22
|
I-16-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-15-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
23
|
I-17-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-16-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
24
|
I-18-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-17-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
25
|
I-19-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-18-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
26
|
I-20-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-19-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
27
|
I-21-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-20-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
28
|
I-22-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-21-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
29
|
I-23-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-22-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
30
|
I-24-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-23-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
31
|
I-25-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-24-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
32
|
I-26-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-25-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
33
|
I-27-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-26-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
34
|
I-28-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-27-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
35
|
I-29-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-28-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
36
|
I-30-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-29-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
37
|
I-31-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-30-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
38
|
I-32-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-31-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
39
|
I-33-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-32-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
40
|
I-34-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-33-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
41
|
I-35-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-34-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
42
|
I-36-A
and I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-35-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
43
|
I-37-A
and I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-36-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
44
|
I-38-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-37-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
45
|
I-39-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-38-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
46
|
I-40-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-39-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
47
|
I-41-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-40-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
48
|
I-42-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-41-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
49
|
I-43-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-42-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
50
|
I-44-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-43-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
51
|
I-45-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-44-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
52
|
I-46-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-45-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
53
|
I-47-A
and I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-46-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
54
|
I-48-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-47-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
55
|
I-49-A
and I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-48-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
56
|
I-50-A
and I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-49-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
57
|
I-51-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-50-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
58
|
I-52-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-51-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
59
|
I-53-A
and I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-52-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
60
|
I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC 1 Pass-Through Rate
|
||
|
I-1-A
through I-53-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
|||
|
thereafter
|
I-1-A
through I-54-A
|
Uncertificated
REMIC 1 Pass-Through Rate
|
Uncertificated
REMIC Regular Interest:
The
REMIC I Regular Interests, the REMIC II Regular Interests and the Class IO
Interest.
Voting
Rights:
The
portion of the voting rights of all the Certificates that is allocated to any
Certificate for purposes of the voting provisions hereunder. Voting Rights
shall
be allocated (i) 98% to the Certificates (other than the Class X, Class P
and the Residual Certificates) and (ii) 1% to each of the Class X Certificates
and the Class P Certificates. Voting rights will be allocated among the
Certificates of each such Class in accordance with their respective Percentage
Interests. The Residual Certificates will not be allocated any voting
rights.
Xxxxx
Fargo:
Xxxxx
Fargo Bank, National Association, and any successor thereto appointed under
the
Servicing Agreement in connection with the servicing and administration of
the
Xxxxx Fargo Mortgage Loans.
Xxxxx
Fargo Mortgage Loans:
Those
Mortgage Loans serviced by Xxxxx Fargo pursuant to the terms and provisions
of
the Servicing Agreement and identified as such on the Mortgage Loan
Schedule.
Section
1.02 Allocation
of Certain Interest Shortfalls.
For
purposes of calculating the amount of the Interest Remittance Amount for any
Distribution Date, (1) the aggregate amount of any Net Interest Shortfalls
in
respect of the Mortgage Loans for any Distribution Date shall reduce the
Interest Remittance Amount on a pro rata basis based on, and to the extent
of,
one month’s interest at the then applicable respective Pass-Through Rate on the
respective Certificate Principal Balance of each Class of Senior Certificates
and Subordinate Certificates and (2) the aggregate amount of any Realized Losses
allocated to the Subordinate Certificates and Basis Risk Shortfalls allocated
to
the Senior Certificates and the Subordinate Certificates for any Distribution
Date shall be allocated to the Class X Certificates based on, and to the extent
of, one month’s interest at the then applicable respective Pass-Through Rate on
the Certificate Principal Balance thereof on any Distribution Date.
For
purposes of calculating the amount of Uncertificated Accrued Interest for the
REMIC I Group I Regular Interests for any Distribution Date the aggregate amount
of any Net Interest Shortfalls incurred in respect of Loan Group I for any
Distribution Date shall be allocated first,
to
REMIC I Regular Interest I and to the REMIC I Group I Regular Interests ending
with the designation “B”, pro
rata
based
on, and to the extent of, one month’s interest at the then applicable respective
Uncertificated REMIC I Pass-Through Rates on the respective Uncertificated
Principal Balances of each such REMIC I Regular Interest, and then, to REMIC
I
Group I Regular Interests ending with the designation “A”, pro rata based on,
and to the extent of, one month’s interest at the then applicable respective
Uncertificated REMIC I Pass-Through Rates on the respective Uncertificated
Principal Balances of each such REMIC I Regular Interest. For purposes of
calculating the amount of Uncertificated Accrued Interest for the REMIC I Group
II Regular Interests for any Distribution the aggregate amount of any Net
Interest Shortfalls incurred in respect of Loan Group II for any Distribution
Date shall be allocated first,
REMIC I Regular Interest II and to the REMIC I Group II Regular Interests ending
with the designation “B”, pro
rata
based
on, and to the extent of, one month’s interest at the then applicable respective
Uncertificated REMIC I Pass-Through Rates on the respective Uncertificated
Principal Balances of each such REMIC I Regular Interest, and then, to REMIC
I
Group II Regular Interests ending with the designation “A”, pro rata based on,
and to the extent of, one month’s interest at the then applicable respective
Uncertificated REMIC I Pass-Through Rates on the respective Uncertificated
Principal Balances of each such REMIC I Regular Interest.
For
purposes of calculating the amount of Uncertificated Accrued Interest for the
REMIC II Regular Interests for any Distribution Date:
The
aggregate amount of any Net Interest Shortfalls incurred in respect of the
Mortgage Loans for any Distribution Date shall be allocated among
REMIC II Regular Interest LT-AA, REMIC II Regular Interest LT-IA1, REMIC II
Regular Interest LT-IIA1, REMIC II Regular Interest LT-IIA2, REMIC II Regular
Interest LT-IIA3, REMIC II Regular Interest LT-IIA4, REMIC II Regular Interest
LT-M1, REMIC II Regular Interest LT-M2, REMIC II Regular Interest LT-M3, REMIC
II Regular Interest LT-M4, REMIC II Regular Interest LT-M5, REMIC II Regular
Interest LT-M6, REMIC II Regular Interest LT-M7, REMIC II Regular Interest
LT-M8, REMIC II Regular Interest LT-M9, REMIC II Regular Interest LT-B1 and
REMIC I Regular Interest LT-ZZ, pro
rata
based
on, and to the extent of, one month’s interest at the then applicable respective
Uncertificated REMIC I Pass-Through Rate on the respective Uncertificated
Principal Balance of each such REMIC I Regular Interest.
ARTICLE
II
CONVEYANCE
OF TRUST FUND
REPRESENTATIONS
AND WARRANTIES
Section
2.01 Conveyance
of Trust Fund.
The
Sponsor hereby sells, transfers, assigns, sets over and otherwise conveys to
the
Depositor, without recourse, all the right, title and interest of the Sponsor
in
and to the assets in the Trust Fund and
the
Supplemental Interest Trust.
The
Sponsor has entered into this Agreement in consideration for the purchase of
the
Mortgage Loans by the Depositor and has agreed to take the actions specified
herein.
The
Depositor, concurrently with the execution and delivery hereof, hereby sells,
transfers, assigns, sets over and otherwise conveys to the Trustee for the
use
and benefit of the Certificateholders, without recourse, all the right, title
and interest of the Depositor in and to the Trust Fund and the Supplemental
Interest Trust.
Concurrently
with the execution and delivery of this Agreement, the Depositor does hereby
assign to the Trustee all of its rights and interest under the Mortgage Loan
Purchase Agreement, to the extent of the Mortgage Loans sold under the Mortgage
Loan Purchase Agreement. The Trustee hereby accepts such assignment, and shall
be entitled to exercise all rights of the Depositor under the Mortgage Loan
Purchase Agreement as if, for such purpose, it were the Depositor. The foregoing
sale, transfer, assignment, set-over, deposit and conveyance does not and is
not
intended to result in creation or assumption by the Trustee of any obligation
of
the Depositor, the Sponsor or any other Person in connection with the Mortgage
Loans or any other agreement or instrument relating thereto except as
specifically set forth herein.
In
connection with such sale, the Depositor does hereby deliver to, and deposit
with the Custodian pursuant to the Custodial Agreement the documents with
respect to each Mortgage Loan as described under Section 2 of the Custodial
Agreement (the “Mortgage Loan Documents”). In connection with such delivery and
as further described in the Custodial Agreement, the Custodian will be required
to review such Mortgage Loan Documents and deliver to the Trustee, the
Depositor, the Servicers and the Sponsor certifications (in the forms attached
to the Custodial Agreement) with respect to such review with exceptions noted
thereon. In addition, under the Custodial Agreement the Depositor will be
required to cure certain defects with respect to the Mortgage Loan Documents
for
the related Mortgage Loans after the delivery thereof by the Depositor to the
Custodian as more particularly set forth therein.
Notwithstanding
anything to the contrary contained herein, the parties hereto acknowledge that
the functions of the Trustee with respect to the custody, acceptance, inspection
and release of the Mortgage Files, including but not limited to certain
insurance policies and documents contemplated by this Agreement, and preparation
and delivery of the certifications shall be performed by the Custodian pursuant
to the terms and conditions of the Custodial Agreement.
The
Depositor shall deliver or cause to be delivered to the related Servicer copies
of all trailing documents required to be included in the related Mortgage File
at the same time the originals or certified copies thereof are delivered to
the
Custodian, such documents including the mortgagee policy of title insurance
and
any Mortgage Loan Documents upon return from the recording office. The Servicers
shall not be responsible for any custodial fees or other costs incurred in
obtaining such documents and the Depositor shall cause the Servicers to be
reimbursed for any such costs the Servicers may incur in connection with
performing its obligations under this Agreement or the Servicing Agreement,
as
applicable.
The
Mortgage Loans permitted by the terms of this Agreement to be included in the
Trust are limited to (i) Mortgage Loans (which the Depositor acquired pursuant
to the Mortgage Loan Purchase Agreement, which contains, among other
representations and warranties, a representation and warranty of the Sponsor
that no Mortgage Loan is a “High-Cost Home Loan” as defined in the New Jersey
Home Ownership Act effective November 27, 2003, as defined in the New Mexico
Home Loan Protection Act effective January 1, 2004), as defined in the
Massachusetts Predatory Home Loan Practices Act, effective November 7, 2004
(Mass. Xxx. Laws Ch. 183C) or as defined in the Indiana Home Loan Practices
Act,
effective January 1, 2005 (Ind. Code Xxx. Sections 24-9-1 through 24-9-9) and
(ii) Qualified Substitute Mortgage Loans (which, by definition as set forth
herein and referred to in the Mortgage Loan Purchase Agreement, are required
to
conform to, among other representations and warranties, the representation
and
warranty of the Sponsor that no Qualified Substitute Mortgage Loan is a
“High-Cost Home Loan” as defined in the New Jersey Home Ownership Act effective
November 27, 2003, as defined in the New Mexico Home Loan Protection Act
effective January 1, 2004, as defined in the Massachusetts Predatory Home Loan
Practices Act, effective November 7, 2004 (Mass. Xxx. Laws Ch. 183C) or as
defined in the Indiana Home Loan Practices Act, effective January 1, 2005 (Ind.
Code Xxx. Sections 24-9-1 through 24-9-9). The Depositor and the Trustee on
behalf of the Trust understand and agree that it is not intended that any
mortgage loan be included in the Trust that is a “High-Cost Home Loan” as
defined in the New Jersey Home Ownership Act effective November 27, 2003, as
defined in the New Mexico Home Loan Protection Act effective January 1, 2004,
as
defined in the Massachusetts Predatory Home Loan Practices Act, effective
November 7, 2004 (Mass. Xxx. Laws Ch. 183C) or as defined in the Indiana Home
Loan Practices Act, effective January 1, 2005 (Ind. Code Xxx. Sections 24-9-1
through 24-9-9).
Section
2.02 Acceptance
of the Mortgage Loans.
(a) Based
on
the initial trust receipt received by it from the Custodian pursuant to the
Custodial Agreement, the Trustee acknowledges receipt, subject to the provisions
of Section 2.01 hereof and Section 2 of the Custodial Agreement, of
the Mortgage Loan Documents and all other assets included in the definition
of
“REMIC I” under clauses (i), (ii) (iii), (v) and (vi) (to the extent of amounts
deposited into the Distribution Account) and declares that it holds (or the
Custodian on its behalf holds) and will hold such documents and the other
documents delivered to it constituting a Mortgage Loan Document, and that it
holds (or the Custodian on its behalf holds) or will hold all such assets and
such other assets included in the definition of “REMIC I” in trust for the
exclusive use and benefit of all present and future
Certificateholders.
(b) In
conducting the review of the Mortgage Files in accordance with the Custodial
Agreement, the Custodian on the Trustee’s behalf will ascertain whether all
required documents have been executed and received and whether those documents
relate to the Mortgage Loans identified in Exhibit B to this Agreement, as
supplemented. If the Custodian finds any document constituting part of the
Mortgage File not to have been executed or received, or to be unrelated to
the
Mortgage Loans identified in Exhibit B, the Sponsor shall correct or cure any
such defect or, if prior to the end of the second anniversary of the Closing
Date, the Sponsor may substitute for the related Mortgage Loan a Replacement
Mortgage Loan, which substitution shall be accomplished in the manner and
subject to the conditions set forth in Section 2.03 or shall deliver to the
Trustee an Opinion of Counsel to the effect that such defect does not materially
or adversely affect the interests of the Certificateholders in such Mortgage
Loan within sixty (60) days from the date of notice from the Custodian of the
defect and if the Sponsor fails to correct or cure the defect or deliver such
opinion within such period, the Sponsor will, subject to Section 2.03,
within ninety (90) days from the notification of the Custodian, purchase such
Mortgage Loan at the Purchase Price; provided, however, that if such defect
relates solely to the inability of the Sponsor to deliver the Mortgage,
assignment thereof to the Custodian, or intervening assignments thereof with
evidence of recording thereon because such documents have been submitted for
recording and have not been returned by the applicable jurisdiction, the Sponsor
shall not be required to purchase such Mortgage Loan if the Sponsor delivers
such documents promptly upon receipt, but in no event later than 360 days after
the Closing Date.
(c) No
later
than 180 days after the Closing Date, the Custodian on the Trustee’s behalf will
review, for the benefit of the Certificateholders, the Mortgage Files and will
execute and deliver or cause to be executed and delivered to the Sponsor, the
related Servicer and the Trustee, a final trust receipt substantially in the
form annexed to the Custodial Agreement. In conducting such review, the
Custodian on the Trustee’s behalf and in accordance with the terms of the
Custodial Agreement will ascertain whether each document required to be recorded
has been returned from the recording office with evidence of recording thereon
and the Custodian on the Trustee’s behalf has received either an original or a
copy thereof, as required in the Custodial Agreement. If the Custodian finds
that any document with respect to a Mortgage Loan has not been received, or
is
unrelated to the Mortgage Loans identified in Exhibit B or appears to be
defective on its face, the Custodian shall note such defect in the exception
report attached the final trust receipt issued pursuant to the Custodial
Agreement and the Sponsor shall correct or cure any such defect or, if prior
to
the end of the second anniversary of the Closing Date, the Sponsor may
substitute for the related Mortgage Loan a Replacement Mortgage Loan, which
substitution shall be accomplished in the manner and subject to the conditions
set forth in Section 2.03 or shall deliver to the Trustee an Opinion of
Counsel to the effect that such defect does not materially or adversely affect
the interests of Certificateholders in such Mortgage Loan within 60 days from
the date of notice from the Trustee of the defect and if the Sponsor is unable
within such period to correct or cure such defect, or to substitute the related
Mortgage Loan with a Replacement Mortgage Loan or to deliver such opinion,
the
Sponsor shall, subject to Section 2.03, within 90 days from the
notification of the Trustee, purchase such Mortgage Loan at the Purchase Price;
provided, however, that if such defect relates solely to the inability of the
Sponsor to deliver the Mortgage, assignment thereof to the Trustee or
intervening assignments thereof with evidence of recording thereon, because
such
documents have not been returned by the applicable jurisdiction, the Sponsor
shall not be required to purchase such Mortgage Loan, if the Sponsor delivers
such documents promptly upon receipt, but in no event later than 360 days after
the Closing Date.
(d) In
the
event that a Mortgage Loan is purchased by the Sponsor in accordance with
subsections 2.02(a) or (b) above or Section 2.03, the Sponsor shall remit
the applicable Purchase Price to the related Servicer for deposit in the related
Custodial Account and shall provide written notice to the Securities
Administrator detailing the components of the Purchase Price, signed by an
authorized officer of the Sponsor. Upon receipt of notice of the deposit of
the
Purchase Price in the related Custodial Account and upon receipt of a request
for release (in the form attached to the Custodial Agreement) with respect
to
such Mortgage Loan, the Custodian, on behalf of the Trustee, will release to
the
Sponsor the related Mortgage File and the Trustee shall execute and deliver
all
instruments of transfer or assignment, without recourse, furnished to it by
the
Sponsor, as are necessary to vest in the Sponsor title to and rights under
the
Mortgage Loan. Such purchase shall be deemed to have occurred on the date on
which the deposit into the related Custodial Account was made. The Securities
Administrator shall promptly notify the Rating Agencies of such repurchase.
The
obligation of the Sponsor to cure, repurchase or substitute for any Mortgage
Loan as to which a defect in a constituent document exists shall be the sole
remedies respecting such defect available to the Certificateholders or to the
Securities Administrator on their behalf. The Sponsor shall promptly reimburse
the Securities Administrator for any fees, costs and expenses (including all
reasonable and documented attorneys fees and expenses) incurred by the
Securities Administrator in respect of enforcing the remedies for such
breach.
(e) The
Sponsor shall deliver to the Custodian the Mortgage Note and other documents
constituting the Mortgage File with respect to any Replacement Mortgage Loan,
which the Custodian will review as provided in the Custodial Agreement,
provided, that the Closing Date referred to therein shall instead be the date
of
delivery of the Mortgage File with respect to each Replacement Mortgage
Loan.
Section
2.03 Representations,
Warranties and Covenants of the Servicers, the Sponsor and the Master
Servicer.
(a) Equity
One hereby represents and warrants to, and covenants with, the Sponsor, the
Depositor, the Master Servicer, the Securities Administrator and the Trustee
as
follows, as of the Closing Date:
(i) It
is
duly organized and is validly existing and in good standing under the laws
of
the state of its formation and either it, or one or more Subservicers engaged
by
it, is duly authorized and qualified to transact any and all business
contemplated by this Agreement to be conducted by Equity One in any state in
which a Mortgaged Property related to an Equity One Mortgage Loan is located
or
is otherwise not required under applicable law to effect such qualification
and,
in any event, is in compliance with the doing business laws of any such state,
to the extent necessary to ensure, in each case, the ability of the party
performing the servicing function to service the Equity One Mortgage Loans
in
accordance with the terms of this Agreement and to perform any of Equity One’s
other obligations under this Agreement in accordance with the terms
hereof.
(ii) It,
or
one or more Subservicers engaged by it, has the full power and authority to
service each Equity One Mortgage Loan, and to execute, deliver and perform,
and
to enter into and consummate the transactions contemplated by this Agreement
and
has duly authorized by all necessary corporate action on its part the execution,
delivery and performance of this Agreement; and this Agreement, assuming the
due
authorization, execution and delivery hereof by the other parties hereto,
constitutes its legal, valid and binding obligation, enforceable against it
in
accordance with its terms, except that (a) the enforceability hereof may be
limited by bankruptcy, insolvency, moratorium, receivership and other similar
laws relating to creditors’ rights generally and (b) the remedy of specific
performance and injunctive and other forms of equitable relief may be subject
to
equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought and further subject to public policy with
respect to indemnity and contribution under applicable securities
law.
(iii) The
execution and delivery of this Agreement by it, the servicing of the Equity
One
Mortgage Loans by it and its Subservicers under this Agreement, the consummation
of any other of the transactions contemplated by this Agreement, and the
fulfillment of or compliance with the terms hereof are in its ordinary course
of
business and will not (A) result in a material breach of any term or provision
of its charter or by-laws or (B) materially conflict with, result in a material
breach, violation or acceleration of, or result in a material default under,
the
terms of any other material agreement or instrument to which it is a party
or by
which it may be bound, or (C) constitute a material violation of any statute,
order or regulation applicable to it of any court, regulatory body,
administrative agency or governmental body having jurisdiction over it; and
it
is not in breach or violation of any material indenture or other material
agreement or instrument, or in violation of any statute, order or regulation
of
any court, regulatory body, administrative agency or governmental body having
jurisdiction over it which breach or violation may materially impair its ability
to perform or meet any of its obligations under this Agreement.
(iv) It,
or
one or more Subservicers engagaged by it, is an approved servicer of
conventional mortgage loans for Xxxxxx Xxx or Xxxxxxx Mac.
(v) No
litigation is pending or, to the best of its knowledge, threatened in writing,
against it that would materially and adversely affect the execution, delivery
or
enforceability of this Agreement or its ability to service the Equity One
Mortgage Loans or to perform any of its other obligations under this Agreement
in accordance with the terms hereof.
(vi) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for its execution, delivery and performance of, or compliance
with, this Agreement or the consummation of the transactions contemplated
hereby, or if any such consent, approval, authorization or order is required,
it
has obtained the same.
(vii) Equity
One has accurately and fully reported, and will continue to accurately and
fully
report its borrower credit files to each of the credit repositories in a timely
manner materially in accordance with the Fair Credit Reporting Act and its
implementing legislation.
(viii) Equity
One is a member of MERS in good standing, and will comply in all material
respects with the rules and procedures of MERS in connection with the servicing
of the Equity One Mortgage Loans that are registered with MERS.
(ix) Equity
One will not waive any Prepayment Charge with respect to an Equity One Mortgage
Loan serviced by it unless it is waived in accordance with the standard set
forth in Section 3.01.
(b) Ocwen
hereby represents and warrants to, and covenants with, the Sponsor, the
Depositor, the Master Servicer, the Securities Administrator and the Trustee
as
follows, as of the Closing Date:
(i) It
is
duly organized and is validly existing and in good standing under the laws
of
the state of its formation and is duly authorized and qualified to transact
any
and all business contemplated by this Agreement to be conducted by it in any
state in which a Mortgaged Property related to an Ocwen Mortgage Loan is located
or is otherwise not required under applicable law to effect such qualification
and, in any event, is in compliance with the doing business laws of any such
state, to the extent necessary to ensure its ability to service the Ocwen
Mortgage Loans in accordance with the terms of this Agreement and to perform
any
of its other obligations under this Agreement in accordance with the terms
hereof.
(ii) It
has
the full power and authority to service each Ocwen Mortgage Loan, and to
execute, deliver and perform, and to enter into and consummate the transactions
contemplated by this Agreement and has duly authorized by all necessary
corporate action on its part the execution, delivery and performance of this
Agreement; and this Agreement, assuming the due authorization, execution and
delivery hereof by the other parties hereto, constitutes its legal, valid and
binding obligation, enforceable against it in accordance with its terms, except
that (a) the enforceability hereof may be limited by bankruptcy, insolvency,
moratorium, receivership and other similar laws relating to creditors’ rights
generally and (b) the remedy of specific performance and injunctive and other
forms of equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought
and
further subject to public policy with respect to indemnity and contribution
under applicable securities law.
(iii) The
execution and delivery of this Agreement by it, the servicing of the Ocwen
Mortgage Loans by it under this Agreement, the consummation of any other of
the
transactions contemplated by this Agreement, and the fulfillment of or
compliance with the terms hereof are in its ordinary course of business and
will
not (A) result in a material breach of any term or provision of its
organizational documents or (B) materially conflict with, result in a material
breach, violation or acceleration of, or result in a material default under,
the
terms of any other material agreement or instrument to which it is a party
or by
which it may be bound, or (C) constitute a material violation of any statute,
order or regulation applicable to it of any court, regulatory body,
administrative agency or governmental body having jurisdiction over it; and
it
is not in breach or violation of any material indenture or other material
agreement or instrument, or in violation of any statute, order or regulation
of
any court, regulatory body, administrative agency or governmental body having
jurisdiction over it which breach or violation may materially impair its ability
to perform or meet any of its obligations under this Agreement.
(iv) It
is an
approved servicer of conventional mortgage loans for Xxxxxx Mae or Xxxxxxx
Mac
and is a mortgagee approved by the Secretary of Housing and Urban Development
pursuant to sections 203 and 211 of the National Housing Act.
(v) No
litigation is pending or, to the best of its knowledge, threatened in writing,
against it that would materially and adversely affect the execution, delivery
or
enforceability of this Agreement or its ability to service the Ocwen Mortgage
Loans or to perform any of its other obligations under this Agreement in
accordance with the terms hereof.
(vi) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for its execution, delivery and performance of, or compliance
with, this Agreement or the consummation of the transactions contemplated
hereby, or if any such consent, approval, authorization or order is required,
it
has obtained the same.
(vii) Ocwen
has
accurately and fully reported, and will continue to accurately and fully report
its borrower credit files to each of the credit repositories in a timely manner
materially in accordance with the Fair Credit Reporting Act and its implementing
legislation.
(viii) Ocwen
is
a member of MERS in good standing, and will comply in all material respects
with
the rules and procedures of MERS in connection with the servicing of the Ocwen
Mortgage Loans that are registered with MERS.
(ix) Ocwen
will not waive any Prepayment Charge with respect to an Ocwen Mortgage Loan
unless it is waived in accordance with the standard set forth in
Section 3.01.
(c) SPS
hereby represents and warrants to, and covenants with, the Sponsor, the
Depositor, the Master Servicer, the Securities Administrator and the Trustee
as
follows, as of the Closing Date:
(i) It
is
duly organized and is validly existing and in good standing under the laws
of
the state of its formation and is duly authorized and qualified to transact
any
and all business contemplated by this Agreement to be conducted by it in any
state in which a Mortgaged Property related to an SPS Mortgage Loan is located
or is otherwise not required under applicable law to effect such qualification
and, in any event, is in compliance with the doing business laws of any such
state, to the extent necessary to ensure its ability to service the SPS Mortgage
Loans in accordance with the terms of this Agreement and to perform any of
its
other obligations under this Agreement in accordance with the terms
hereof.
(ii) It
has
the full power and authority to service each SPS Mortgage Loan, and to execute,
deliver and perform, and to enter into and consummate the transactions
contemplated by this Agreement and has duly authorized by all necessary
corporate action on its part the execution, delivery and performance of this
Agreement; and this Agreement, assuming the due authorization, execution and
delivery hereof by the other parties hereto, constitutes its legal, valid and
binding obligation, enforceable against it in accordance with its terms, except
that (a) the enforceability hereof may be limited by bankruptcy, insolvency,
moratorium, receivership and other similar laws relating to creditors’ rights
generally and (b) the remedy of specific performance and injunctive and other
forms of equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought
and
further subject to public policy with respect to indemnity and contribution
under applicable securities law.
(iii) The
execution and delivery of this Agreement by it, the servicing of the SPS
Mortgage Loans by it under this Agreement, the consummation of any other of
the
transactions contemplated by this Agreement, and the fulfillment of or
compliance with the terms hereof are in its ordinary course of business and
will
not (A) result in a material breach of any term or provision of its charter
or
by-laws or (B) materially conflict with, result in a material breach, violation
or acceleration of, or result in a material default under, the terms of any
other material agreement or instrument to which it is a party or by which it
may
be bound, or (C) constitute a material violation of any statute, order or
regulation applicable to it of any court, regulatory body, administrative agency
or governmental body having jurisdiction over it; and it is not in breach or
violation of any material indenture or other material agreement or instrument,
or in violation of any statute, order or regulation of any court, regulatory
body, administrative agency or governmental body having jurisdiction over it
which breach or violation may materially impair its ability to perform or meet
any of its obligations under this Agreement.
(iv) It
is an
approved servicer of conventional mortgage loans for Xxxxxx Mae or Xxxxxxx
Mac
and is a mortgagee approved by the Secretary of Housing and Urban Development
pursuant to sections 203 and 211 of the National Housing Act.
(v) No
litigation is pending or, to the best of its knowledge, threatened in writing,
against it that would materially and adversely affect the execution, delivery
or
enforceability of this Agreement or its ability to service the SPS Mortgage
Loans or to perform any of its other obligations under this Agreement in
accordance with the terms hereof.
(vi) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for its execution, delivery and performance of, or compliance
with, this Agreement or the consummation of the transactions contemplated
hereby, or if any such consent, approval, authorization or order is required,
it
has obtained the same.
(vii) SPS
has
accurately and fully reported, and will continue to accurately and fully report
its borrower credit files to each of the credit repositories in a timely manner
materially in accordance with the Fair Credit Reporting Act and its implementing
legislation.
(viii) SPS
is a
member of MERS in good standing, and will comply in all material respects with
the rules and procedures of MERS in connection with the servicing of the SPS
Mortgage Loans that are registered with MERS.
(ix) SPS
will
not waive any Prepayment Charge with respect to a Mortgage Loan serviced by
it
unless it is waived in accordance with the standard set forth in
Section 3.01.
If
the
covenant set forth in Section 2.03(a)(ix), (b)(ix) or (c)(ix) above is
breached by the related Servicer, such Servicer will pay the amount of such
waived Prepayment Charge, for the benefit of the Holders of the Class P
Certificates, by depositing such amount into the related Custodial Account
within ninety (90) days of the earlier of discovery by such Servicer or receipt
of notice by such Servicer of such breach. Notwithstanding the foregoing, or
anything to the contrary contained in this Agreement, no Servicer shall have
any
liability for a waiver of any Prepayment Charge in the event that such
Servicer’s determination to make such a waiver was made by such Servicer in
reliance on information properly received by such Servicer from any Person
in
accordance with the terms of this Agreement.
(d) The
Sponsor hereby represents and warrants to and covenants with, the Depositor,
the
Servicers, the Master Servicer, the Securities Administrator and the Trustee
as
follows, as of the Closing Date:
(i) The
Sponsor is duly organized, validly existing and in good standing under the
laws
of the State of Delaware and is duly authorized and qualified to transact any
and all business contemplated by this Agreement to be conducted by the Sponsor
in any state in which a Mortgaged Property is located or is otherwise not
required under applicable law to effect such qualification and, in any event,
is
in compliance with the doing business laws of any such state, to the extent
necessary to ensure its ability to enforce each Mortgage Loan, to sell the
Mortgage Loans in accordance with the terms of this Agreement and to perform
any
of its other obligations under this Agreement in accordance with the terms
hereof.
(ii) The
Sponsor has the full corporate power and authority to sell each Mortgage Loan,
and to execute, deliver and perform, and to enter into and consummate the
transactions contemplated by this Agreement and has duly authorized by all
necessary corporate action on the part of the Sponsor the execution, delivery
and performance of this Agreement; and this Agreement, assuming the due
authorization, execution and delivery hereof by the other parties hereto,
constitutes a legal, valid and binding obligation of the Sponsor, enforceable
against the Sponsor in accordance with its terms, except that (a) the
enforceability hereof may be limited by bankruptcy, insolvency, moratorium,
receivership and other similar laws relating to creditors’ rights generally and
(b) the remedy of specific performance and injunctive and other forms of
equitable relief may be subject to equitable defenses and to the discretion
of
the court before which any proceeding therefor may be brought and further
subject to public policy with respect to indemnity and contribution under
applicable securities law.
(iii) The
execution and delivery of this Agreement by the Sponsor, the sale of the
Mortgage Loans by the Sponsor under this Agreement, the consummation of any
other of the transactions contemplated by this Agreement, and the fulfillment
of
or compliance with the terms hereof are in the ordinary course of business
of
the Sponsor and will not (A) result in a material breach of any term or
provision of the charter or by-laws of the Sponsor or (B) materially conflict
with, result in a material breach, violation or acceleration of, or result
in a
material default under, the terms of any other material agreement or instrument
to which the Sponsor is a party or by which it may be bound, or (C) constitute
a
material violation of any statute, order or regulation applicable to the Sponsor
of any court, regulatory body, administrative agency or governmental body having
jurisdiction over the Sponsor; and the Sponsor is not in breach or violation
of
any material indenture or other material agreement or instrument, or in
violation of any statute, order or regulation of any court, regulatory body,
administrative agency or governmental body having jurisdiction over it which
breach or violation may materially impair the Sponsor’s ability to perform or
meet any of its obligations under this Agreement.
(iv) The
Sponsor is an approved seller of conventional mortgage loans for Xxxxxx Mae
or
Xxxxxxx Mac and is a mortgagee approved by the Secretary of Housing and Urban
Development pursuant to sections 203 and 211 of the National Housing
Act.
(v) No
litigation is pending or, to the best of the Sponsor’s knowledge, threatened,
against the Sponsor that would materially and adversely affect the execution,
delivery or enforceability of this Agreement or the ability of the Sponsor
to
sell the Mortgage Loans or to perform any of its other obligations under this
Agreement in accordance with the terms hereof.
(vi) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for the execution, delivery and performance by the Sponsor
of,
or compliance by the Sponsor with, this Agreement or the consummation of the
transactions contemplated hereby, or if any such consent, approval,
authorization or order is required, the Sponsor has obtained the
same.
(vii) The
representations and warranties set forth in Section 8 of the Mortgage Loan
Purchase Agreement are true and correct as of the Closing Date.
(viii) No
Mortgage Loan is subject to the Home Ownership and Equity Protection Act of
1994
or any comparable law and no Mortgage Loan is classified and/or defined as
a
“high cost”, “covered”, “high risk home” or “predatory” loan under any other
state, federal or local law or regulation or ordinance (or a similarly
classified loan using different terminology under a law imposing heightened
regulatory scrutiny or additional legal liability for residential mortgage
loans
having high interest rates, points and/or fees).
(ix) No
loan
is a High Cost Loan or Covered Loan, as applicable (as such terms are defined
in
Appendix E of the Standard & Poor's Glossary For File Format For LEVELS®
Version 5.7 Revised (attached hereto as Exhibit O) and no Mortgage Loan
originated on or after October 1, 2002 through March 6, 2003 is governed by
the
Georgia Fair Lending Act.
(x) Any
and
all requirements of any federal, state or local law including, without
limitation, usury, truth in lending, real estate settlement procedures, consumer
credit protection, equal credit opportunity, fair housing, predatory, abusive
lending or disclosure laws applicable to the origination and servicing of the
Mortgage Loans have been complied with in all material respects.
(e) Upon
discovery by any of the parties hereto of a breach of a representation or
warranty set forth in Section 2.03(d)(viii), (ix) and (x) and
Section 8 of the Mortgage Loan Purchase Agreement that materially and
adversely affects the interests of the Certificateholders in any Mortgage Loan,
the party discovering such breach shall give prompt written notice thereof
to
the other parties. The Sponsor hereby covenants with respect to the
representations and warranties set forth in Section 2.03(d)(viii), (ix) and
(x) and Section 8 of the Mortgage Loan Purchase Agreement, that within
ninety (90) days of the discovery of a breach of any representation or warranty
set forth therein that materially and adversely affects the interests of the
Certificateholders in any Mortgage Loan, it shall cure such breach in all
material respects and, if such breach is not so cured, (i) prior to the second
anniversary of the Closing Date, remove such Mortgage Loan (a “Deleted Mortgage
Loan”) from the Trust Fund and substitute in its place a Replacement Mortgage
Loan, in the manner and subject to the conditions set forth in this Section;
or
(ii) repurchase the affected Mortgage Loan or Mortgage Loans from the Trustee
at
the Purchase Price in the manner set forth below; provided that any such
substitution pursuant to (i) above or repurchase pursuant to (ii) above shall
not be effected prior to the delivery to the Trustee of an Opinion of Counsel
if
required by Section 2.05 and any such substitution pursuant to (i) above
shall not be effected prior to the additional delivery to the Custodian of
a
request for release in accordance with the Custodial Agreement. The Sponsor
shall promptly reimburse the Trustee for any expenses reasonably incurred by
the
Trustee in respect of enforcing the remedies for such breach. To enable the
related Servicer to amend the Mortgage Loan Schedule, the Sponsor shall, unless
it cures such breach in a timely fashion pursuant to this Section 2.03,
promptly notify the Trustee whether it intends either to repurchase, or to
substitute for, the Mortgage Loan affected by such breach. With respect to
the
representations and warranties in Section 8 of the Mortgage Loan Purchase
Agreement that are made to the best of the Sponsor’s knowledge, if it is
discovered by any of the Depositor, the Sponsor or the Trustee that the
substance of such representation and warranty is inaccurate and such inaccuracy
materially and adversely affects the value of the related Mortgage Loan,
notwithstanding the Sponsor’s lack of knowledge with respect to the substance of
such representation or warranty, the Sponsor shall nevertheless be required
to
cure, substitute for or repurchase the affected Mortgage Loan in accordance
with
the foregoing. Notwithstanding the foregoing, any breach of a representation
or
warranty contained in clauses (viii), (xxxvii), (xxxix), (xliv), (xlv), (xlvi),
(xlvii), (xlviii), (xlix), (l), (lv), (lvi), (lvii), (lviii), (lix), (lx),
(lxi)
and/or (lxii) of Section 8 of the Mortgage Loan Purchase Agreement shall be
automatically deemed to materially and adversely affect the interests of the
Certificateholders.
With
respect to any Replacement Mortgage Loan or Loans, the Sponsor shall deliver
to
the Custodian for the benefit of the Certificateholders such documents and
agreements as are required by Section 2 of the Custodial Agreement. No
substitution will be made in any calendar month after the Determination Date
for
such month. Scheduled Payments due with respect to Replacement Mortgage Loans
in
the Due Period related to the Distribution Date on which such proceeds are
to be
distributed shall not be part of the Trust Fund and will be retained by the
Sponsor. For the month of substitution, distributions to Certificateholders
will
include the Scheduled Payment due on any Deleted Mortgage Loan for the related
Due Period and thereafter the Sponsor shall be entitled to retain all amounts
received in respect of such Deleted Mortgage Loan. The related Servicer shall
amend the Mortgage Loan Schedule for the benefit of the Certificateholders
to
reflect the removal of such Deleted Mortgage Loan and the substitution of the
Replacement Mortgage Loan or Loans and shall deliver the amended Mortgage Loan
Schedule to the Trustee, the Master Servicer and the Securities Administrator.
Upon such substitution, the Replacement Mortgage Loan or Loans shall be subject
to the terms of this Agreement and, with respect to the Xxxxx Fargo Mortgage
Loans, the Servicing Agreement, in all respects, and the Sponsor shall be deemed
to have made with respect to such Replacement Mortgage Loan or Loans, as of
the
date of substitution, the representations and warranties set forth in
Section 8 of the Mortgage Loan Purchase Agreement with respect to such
Mortgage Loan. Upon any such substitution and receipt of notice of the deposit
into the Custodial Account of the amount required to be deposited therein in
connection with such substitution as described in the following paragraph and
receipt by the Custodian of a request for release for such Mortgage Loan in
accordance with the Custodial Agreement, the Custodian on behalf of the Trustee
shall release to the Sponsor the Mortgage File relating to such Deleted Mortgage
Loan and held for the benefit of the Certificateholders and the Trustee shall
execute and deliver at the Sponsor’s direction such instruments of transfer or
assignment as have been prepared by the Sponsor, in each case without recourse,
as shall be necessary to vest in the Sponsor, or its respective designee, title
to the Trustee’s interest in any Deleted Mortgage Loan substituted for pursuant
to this Section 2.03. Neither the Trustee nor the Custodian shall have any
further responsibility with regard to such Mortgage File.
For
any
month in which the Sponsor substitutes one or more Replacement Mortgage Loans
for a Deleted Mortgage Loan, the Securities Administrator will determine the
amount (if any) by which the aggregate principal balance of all the Replacement
Mortgage Loans as of the date of substitution is less than the Stated Principal
Balance (after application of the principal portion of the Scheduled Payment
due
in the month of substitution) of such Deleted Mortgage Loan. An amount equal
to
the aggregate of such deficiencies, described in the preceding sentence for
any
Distribution Date (such amount, the “Substitution Adjustment Amount”) shall be
remitted to the related Servicer for deposit in the related Custodial Account
by
the Sponsor delivering such Replacement Mortgage Loan on or before the
Determination Date for the Distribution Date relating to the Prepayment Period
during which the related Mortgage Loan was required to be purchased or replaced
hereunder.
In
the
event that the Sponsor shall be required to repurchase a Mortgage Loan, the
Purchase Price therefor shall be remitted to the related Servicer for deposit
in
the related Custodial Account, on or before the Determination Date immediately
following the date on which the Sponsor was required to repurchase such Mortgage
Loan. The Purchase Price shall be remitted by the related Servicer to the
Securities Administrator on the Remittance Date occurring in the month
immediately following the month in which the Purchase Price was deposited in
the
Custodial Account. In addition, upon such deposit of the Purchase Price, the
delivery of an Officer’s Certificate by the Servicer to the Trustee certifying
that the Purchase Price has been deposited in the related Custodial Account,
the
delivery of an Opinion of Counsel if required by Section 2.05 and the
receipt of a Request for Release, the Trustee shall release the related Mortgage
File held for the benefit of the related Certificateholders to the Sponsor,
and
the Trustee shall execute and deliver at such Person’s direction the related
instruments of transfer or assignment prepared by the Sponsor, in each case
without recourse, as shall be necessary to transfer title from the Trustee
for
the benefit of the Certificateholders and transfer the Trustee’s interest to the
Sponsor to any Mortgage Loan purchased pursuant to this Section 2.03. It is
understood and agreed that the obligation under this Agreement of the Sponsor
to
cure, repurchase or replace any Mortgage Loan as to which a breach has occurred
or is continuing shall constitute the sole remedies against the Sponsor
respecting such breach available to Certificateholder, the Depositor or the
Trustee.
(f) Xxxxx
Fargo Bank, National Association, in its capacity as Master Servicer and
Securities Administrator hereby represents, warrants and covenants with the
Servicers, the Sponsor, the Depositor and the Trustee as follows, as of the
Closing Date:
(i) It
is a
national banking association duly formed, validly existing and in good standing
under the laws of the United States of America and is duly authorized and
qualified to transact any and all business contemplated by this Agreement to
be
conducted by the Master Servicer;
(ii) It
has
the full power and authority to conduct its business as presently conducted
by
it and to execute, deliver and perform, and to enter into and consummate, all
transactions contemplated by this Agreement. It has duly authorized the
execution, delivery and performance of this Agreement, has duly executed and
delivered this Agreement, and this Agreement, assuming due authorization,
execution and delivery by the other parties hereto, constitutes a legal, valid
and binding obligation of the Master Servicer and the Securities Administrator,
enforceable against it in accordance with its terms except as the enforceability
thereof may be limited by bankruptcy, insolvency, reorganization or similar
laws
affecting the enforcement of creditors’ rights generally and by general
principles of equity;
(iii) The
execution and delivery of this Agreement by it, its consummation of any other
of
the transactions herein contemplated, and the fulfillment of or compliance
with
the terms hereof are in its ordinary course of business and will not (A) result
in a breach of any term or provision of its charter and by-laws or (B) conflict
with, result in a breach, violation or acceleration of, or result in a default
under, the terms of any other material agreement or instrument to which it
is a
party or by which it may be bound, or any statute, order or regulation
applicable to it of any court, regulatory body, administrative agency or
governmental body having jurisdiction over it; and it is not a party to, bound
by, or in breach or violation of any indenture or other agreement or instrument,
or subject to or in violation of any statute, order or regulation of any court,
regulatory body, administrative agency or governmental body having jurisdiction
over it, which materially and adversely affects or, to its knowledge, would
in
the future materially and adversely affect, (x) its ability to perform its
obligations under this Agreement or (y) its business, operations, financial
condition, properties or assets taken as a whole;
(iv) It
does
not believe, nor does it have any reason or cause to believe, that it cannot
perform each and every covenant made by it and contained in this
Agreement;
(v) No
litigation is pending against it that would materially and adversely affect
the
execution, delivery or enforceability of this Agreement or its ability to
perform any of its other obligations hereunder in accordance with the terms
hereof,
(vi) There
are
no actions or proceedings against, or investigations known to it of, it before
any court, administrative or other tribunal (A) that might prohibit its entering
into this Agreement, (B) seeking to prevent the consummation of the transactions
contemplated by this Agreement or (C) that might prohibit or materially and
adversely affect its performance of its obligations under, or validity or
enforceability of, this Agreement; and
(vii) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for the execution, delivery and performance by it of, or
compliance by it with, this Agreement or the consummation by it of the
transactions contemplated by this Agreement, except for such consents,
approvals, authorizations or orders, if any, that have been obtained prior
to
the Closing Date.
(g) The
representations and warranties set forth in Section 2.03 shall survive
delivery of the respective Mortgage Loans and Mortgage Files to the Trustee
or
the Custodian for the benefit of the Certificateholders.
Section
2.04 Representations
and Warranties of the Depositor.
The
Depositor hereby represents and warrants to, and covenants, with the Servicers,
the Sponsor, the Master Servicer, the Securities Administrator and the Trustee
as follows, as of the date hereof and as of the Closing Date:
(i) The
Depositor is duly organized and is validly existing as a corporation in good
standing under the laws of the State of Delaware and has full power and
authority (corporate and other) necessary to own or hold its properties and
to
conduct its business as now conducted by it and to enter into and perform its
obligations under this Agreement.
(ii) The
Depositor has the full corporate power and authority to execute, deliver and
perform, and to enter into and consummate the transactions contemplated by,
this
Agreement and has duly authorized, by all necessary corporate action on its
part, the execution, delivery and performance of this Agreement; and this
Agreement, assuming the due authorization, execution and delivery hereof by
the
other parties hereto, constitutes a legal, valid and binding obligation of
the
Depositor, enforceable against the Depositor in accordance with its terms,
subject, as to enforceability, to (i) bankruptcy, insolvency, moratorium
receivership and other similar laws relating to creditors’ rights generally and
(ii) the remedy of specific performance and injunctive and other forms of
equitable relief may be subject to equitable defenses and to the discretion
of
the court before which any proceeding therefor may be brought and further
subject to public policy with respect to indemnity and contribution under
applicable securities law.
(iii) The
execution and delivery of this Agreement by the Depositor, the consummation
of
the transactions contemplated by this Agreement, and the fulfillment of or
compliance with the terms hereof are in the ordinary course of business of
the
Depositor and will not (A) result in a material breach of any term or provision
of the charter or by-laws of the Depositor or (B) materially conflict with,
result in a material breach, violation or acceleration of, or result in a
material default under, the terms of any other material agreement or instrument
to which the Depositor is a party or by which it may be bound or (C) constitute
a material violation of any statute, order or regulation applicable to the
Depositor of any court, regulatory body, administrative agency or governmental
body having jurisdiction over the Depositor; and the Depositor is not in breach
or violation of any material indenture or other material agreement or
instrument, or in violation of any statute, order or regulation of any court,
regulatory body, administrative agency or governmental body having jurisdiction
over it which breach or violation may materially impair the Depositor’s ability
to perform or meet any of its obligations under this Agreement.
(iv) No
litigation is pending, or, to the best of the Depositor’s knowledge, threatened,
against the Depositor that would materially and adversely affect the execution,
delivery or enforceability of this Agreement or the ability of the Depositor
to
perform its obligations under this Agreement in accordance with the terms
hereof.
(v) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for the execution, delivery and performance by the Depositor
of, or compliance by the Depositor with, this Agreement or the consummation
of
the transactions contemplated hereby, or if any such consent, approval,
authorization or order is required, the Depositor has obtained the
same.
The
Depositor hereby represents and warrants to the Trustee as of the Closing Date,
following the transfer of the Mortgage Loans to it by the Sponsor, the Depositor
had good title to the Mortgage Loans and the related Mortgage Notes were subject
to no offsets, claims, defenses or counterclaims.
It
is
understood and agreed that the representations and warranties set forth in
this
Section 2.04 shall survive delivery of the Mortgage Files to the Trustee or
the Custodian for the benefit of the Certificateholders. Upon discovery by
the
Depositor, a Servicer, the Master Servicer or the Trustee of a breach of such
representations and warranties, the party discovering such breach shall give
prompt written notice to the others and to each Rating Agency.
Section
2.05 Delivery
of Opinion of Counsel in Connection with Substitutions and
Repurchases.
(a) Notwithstanding
any contrary provision of this Agreement, with respect to any Mortgage Loan
that
is not in default or as to which default is not imminent, no repurchase or
substitution pursuant to Sections 2.02 or 2.03 shall be made unless the Sponsor
delivers to the Trustee an Opinion of Counsel, addressed to the Trustee, to
the
effect that such repurchase or substitution would not (i) result in the
imposition of the tax on “prohibited transactions” of REMIC I, REMIC II or REMIC
III or contributions after the Closing Date, as defined in sections 860F(a)(2)
and 860G(d) of the Code, respectively or (ii) cause any of REMIC I, REMIC II
or
REMIC III to fail to qualify as a REMIC at any time that any Certificates are
outstanding. Any Mortgage Loan as to which repurchase or substitution was
delayed pursuant to this paragraph shall be repurchased or the substitution
therefor shall occur (subject to compliance with Sections 2.02 or 2.03) upon
the
earlier of (a) the occurrence of a default or imminent default with respect
to
such Mortgage Loan and (b) receipt by the Trustee of an Opinion of Counsel
to
the effect that such repurchase or substitution, as applicable, will not result
in the events described in clause (i) or clause (ii) of the preceding
sentence.
(b) Upon
discovery by the Depositor or the Sponsor that any Mortgage Loan does not
constitute a “qualified mortgage” within the meaning of section 860G(a)(3) of
the Code, the party discovering such fact shall promptly (and in any event
within five (5) Business Days of discovery) give written notice thereof to
the
other parties and the Trustee. In connection therewith, the Sponsor, at its
option, shall either (i) substitute, if the conditions in Section 2.03(c)
with respect to substitutions are satisfied, a Replacement Mortgage Loan for
the
affected Mortgage Loan, or (ii) repurchase the affected Mortgage Loan within
ninety (90) days of such discovery in the same manner as it would a Mortgage
Loan for a breach of representation or warranty contained in Section 2.03.
The Trustee shall reconvey to the Sponsor the Mortgage Loan to be released
pursuant hereto in the same manner, and on the same terms and conditions, as
it
would a Mortgage Loan repurchased for breach of a representation or warranty
contained in Section 2.03.
Section
2.06 Issuance
of the REMIC I Regular Interests.
The
Trustee acknowledges the assignment to it of the Mortgage Loans and the delivery
to the Custodian on its behalf of the related Mortgage Files, subject to the
provisions of Section 2.01 and Section 2.02, together with the
assignment to it of all other assets included in REMIC I, the receipt of which
is hereby acknowledged. The interests evidenced by the Class R-I Interest,
together with the REMIC I Regular Interests, constitute the entire beneficial
ownership interest in REMIC I. The rights of the Holders of the Class R-I
Interest and REMIC I (as holder of the REMIC I Regular Interests) to receive
distributions from the proceeds of REMIC I in respect of the Class R-I Interest
and the REMIC I Regular Interests, respectively, and all ownership interests
evidenced or constituted by the Class R-I Interest and the REMIC I Regular
Interests, shall be as set forth in this Agreement.
Section
2.07 Conveyance
of the REMIC I Regular Interests; Issuance and Conveyance of the REMIC II
Regular Interests, the Class X Interest, the Class P Interest and the Class
IO
Interest.
(a) The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey to the Trustee, without
recourse, all the right, title and interest of the Depositor in and to the
REMIC
I Regular Interests for the benefit of the Class R-II Interest and REMIC II
(as
holder of the REMIC I Regular Interests). The Trustee acknowledges receipt
of
the REMIC I Regular Interests and declares that it holds and will hold the
same
in trust for the exclusive use and benefit of all present and future Holders
of
the Class R-II Interest and REMIC II (as holder of the REMIC I Regular
Interests). The rights of the Holder of the Class R-II Interest and REMIC II
(as
holder of the REMIC I Regular Interests) to receive distributions from the
proceeds of REMIC II in respect of the Class R-II Interest and the REMIC II
Regular Interests, respectively, and all ownership interests evidenced or
constituted by the Class R-II Interest and the REMIC II Regular Interests,
shall
be as set forth in this Agreement. The Class R-II Interest and the REMIC II
Regular Interests shall constitute the entire beneficial ownership interest
in
REMIC II.
(b) The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey to the Trustee, without
recourse, all the right, title and interest of the Depositor in and to the
REMIC
II Regular Interests for the benefit of the Class R-III Interest and REMIC
III
(as holder of the REMIC II Regular Interests). The Trustee acknowledges receipt
of the REMIC II Regular Interests and declares that it holds and will hold
the
same in trust for the exclusive use and benefit of all present and future
Holders of the Class R-III Interest and REMIC III (as holder of the REMIC II
Regular Interests). The rights of the Holder of the Class R-III Interest and
REMIC III (as holder of the REMIC II Regular Interests) to receive distributions
from the proceeds of REMIC III in respect of the Class R-III Interest and the
Regular Certificates (other than the Class X and Class P Certificates), the
Class X Interest, the Class P Interest and the Class IO Interest, respectively,
and all ownership interests evidenced or constituted by the Class R-III Interest
and the Regular Certificates (other than the Class X and Class P Certificates),
the Class X Interest, the Class P Interest and the Class IO Interest, shall
be
as set forth in this Agreement. The Class R-III Interest, the Regular
Certificates (other than the Class X and Class P Certificates), the Class X
Interest, the Class P Interest and the Class IO Interest shall constitute the
entire beneficial ownership interest in REMIC III.
(c) The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey to the Trustee, without
recourse, all the right, title and interest of the Depositor in and to the
Class
X Interest for the benefit of the Class R-IV Interest and REMIC IV (as holder
of
the Class X Interest). The Trustee acknowledges receipt of the Class X Interest
and declares that it holds and will hold the same in trust for the exclusive
use
and benefit of all present and future Holders of the Class R-IV Interest and
REMIC IV (as holder of the Class X Interest). The rights of the Holder of the
Class R-IV Interest and REMIC IV (as holder of the Class X Interest) to receive
distributions from the proceeds of REMIC IV in respect of the Class R-IV
Interest, the Class X Certificates, and all ownership interests evidenced or
constituted by the Class R-IV Interest and the Class X Certificates, shall
be as
set forth in this Agreement. The Class R-IV Interest and the Class X
Certificates shall constitute the entire beneficial ownership interest in REMIC
IV.
(d) The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey to the Trustee, without
recourse, all the right, title and interest of the Depositor in and to the
Class
P Interest for the benefit of the Class R-V Interest and REMIC V (as holder
of
the Class P Interest). The Trustee acknowledges receipt of the Class P Interest
and declares that it holds and will hold the same in trust for the exclusive
use
and benefit of all present and future Holders of the Class R-V Interest and
REMIC V (as holder of the Class P Interest). The rights of the Holder of the
Class R-V Interest and REMIC V (as holder of the Class P Interest) to receive
distributions from the proceeds of REMIC V in respect of the Class R-V Interest,
the Class P Certificates, and all ownership interests evidenced or constituted
by the Class R-V Interest and the Class P Certificates, shall be as set forth
in
this Agreement. The Class R-V Interest and the Class P Certificates shall
constitute the entire beneficial ownership interest in REMIC V.
(e) The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey to the Trustee, without
recourse, all the right, title and interest of the Depositor in and to the
Class
IO Interest for the benefit of the Class R-VI Interest and REMIC VI (as holder
of the Class IO Interest). The Trustee acknowledges receipt of the Class IO
Interest and declares that it holds and will hold the same in trust for the
exclusive use and benefit of all present and future Holders of the Class R-VI
Interest and REMIC VI (as holder of the Class IO Interest). The rights of the
Holder of the Class R-VI Interest and REMIC VI (as holder of the Class IO
Interest) to receive distributions from the proceeds of REMIC VI in respect
of
the Class R-VI Interest, the REMIC VI Regular Interest IO Certificates, and
all
ownership interests evidenced or constituted by the Class R-VI Interest and
the
REMIC VI Regular Interest IO Certificates, shall be as set forth in this
Agreement. The Class R-VI Interest and the REMIC VI Regular Interest IO
Certificates shall constitute the entire beneficial ownership interest in REMIC
VI.
Section
2.08 Issuance
of Class R Certificates and Class R-X Certificates.
(a) The
Trustee acknowledges the assignment to it of the REMIC I Regular Interests
and
the REMIC II Regular Interests and, concurrently therewith and in exchange
therefor, pursuant to the written request of the Depositor executed by an
officer of the Depositor, the Securities Administrator has executed,
authenticated and delivered to or upon the order of the Depositor, the Class
R
Certificates in authorized denominations.
(b) The
Trustee acknowledges the assignment to it of the Class X Interest, Class P
Interest and Class IO Interest and, concurrently therewith and in exchange
therefor, pursuant to the written request of the Depositor executed by an
officer of the Depositor, the Securities Administrator has executed,
authenticated and delivered to or upon the order of the Depositor, the Class
R-X
Certificates in authorized denominations.
Section
2.09 Establishment
of Trust.
The
Depositor does hereby establish, pursuant to the further provisions of this
Agreement and the laws of the State of New York, an express trust to be known,
for convenience, as “Nomura Home Equity Loan, Inc., Home Equity Loan Trust,
Series 2007-2” and does hereby appoint HSBC Bank USA, National Association, as
Trustee in accordance with the provisions of this Agreement.
Section
2.10 Purpose
and Powers of the Trust.
The
purpose of the common law trust, as created hereunder, is to engage in the
following activities:
(a) acquire
and hold the Mortgage Loans and the other assets of the Trust Fund and the
proceeds therefrom;
(b) to
issue
the Certificates sold to the Depositor in exchange for the Mortgage
Loans;
(c) to
make
payments on the Certificates;
(d) to
engage
in those activities that are necessary, suitable or convenient to accomplish
the
foregoing or are incidental thereto or connected therewith; and
(e) subject
to compliance with this Agreement, to engage in such other activities as may
be
required in connection with conservation of the Trust Fund and the making of
distributions to the Certificateholders.
The
trust
is hereby authorized to engage in the foregoing activities. The Trustee shall
not cause the trust to engage in any activity other than in connection with
the
foregoing or other than as required or authorized by the terms of this Agreement
while any Certificate is outstanding, and this Section 2.10 may not be amended,
without the consent of the Certificateholders evidencing 51% or more of the
aggregate voting rights of the Certificates.
ARTICLE
III
ADMINISTRATION
AND SERVICING OF THE MORTGAGE LOANS; ACCOUNTS
Section
3.01 Servicers
to act as Servicers of the Mortgage Loans.
The
obligations of Ocwen hereunder to service and administer the Mortgage Loans
shall be limited to the Ocwen Mortgage Loans, and with respect to the duties
and
obligations of Ocwen, references herein to the related Mortgage Loans shall
be
limited to the Ocwen Mortgage Loans. The obligations of Equity One hereunder
to
service and administer the Mortgage Loans shall be limited to the Equity One
Mortgage Loans, and with respect to the duties and obligations of Equity One,
references herein to the related Mortgage Loans shall be limited to the Equity
One Mortgage Loans. The obligations of SPS hereunder to service and administer
the Mortgage Loans shall be limited to the SPS Mortgage Loans, and with respect
to the duties and obligations of SPS, references herein to the related Mortgage
Loans shall be limited to the SPS Mortgage Loans. The Xxxxx Fargo Mortgage
Loans
will be serviced and administered by Xxxxx Fargo pursuant to the terms and
provisions of the Servicing Agreement, and none of Ocwen, Equity One or SPS
will
have any responsibility to service or administer the Xxxxx Fargo Mortgage Loans
or have any other obligation or liability with respect to the Xxxxx Fargo
Mortgage Loans. In addition, Xxxxx Fargo shall have no obligation to service
and
administer the Xxxxx Fargo Mortgage Loans in accordance with this Agreement
and
therefore, references to the “related Servicer” and the “related Mortgage Loans”
in this Agreement which describe the servicing and administration of Mortgage
Loans by a Servicer will not include Xxxxx Fargo or the Xxxxx Fargo Mortgage
Loans.
Each
Servicer shall service and administer the related Mortgage Loans on behalf
of
the Trust Fund and in the best interest of and for the benefit of the
Certificateholders (as determined by such Servicer in its reasonable judgment)
in accordance with the terms of this Agreement and the Mortgage Loans and to
the
extent consistent with such terms and in accordance with and exercising the
same
care in performing those practices that such Servicer customarily employs and
exercises in servicing and administering mortgage loans for its own account
and
of the same type as such Mortgage Loans in the jurisdiction where the related
Mortgaged Property is located (including, compliance with all applicable
federal, state and local laws).
To
the
extent consistent with the foregoing, each Servicer shall seek the timely and
complete recovery of principal and interest on the Mortgage Notes related to
the
Mortgage Loans and shall waive a Prepayment Charge only under the following
circumstances: (i) such waiver is standard and customary in servicing similar
mortgage loans and (ii) either (A) such waiver is related to a default or
reasonably foreseeable default and would, in the reasonable judgment of the
related Servicer, maximize recovery of total proceeds taking into account the
value of such Prepayment Charge and the related Mortgage Loan and, if such
waiver is made in connection with a refinancing of the related Mortgage Loan,
such refinancing is related to a default or a reasonably foreseeable default
or
(B) such waiver is made in connection with a refinancing of the related Mortgage
Loan unrelated to a default or a reasonably foreseeable default where (x) the
related Mortgagor has stated to the related Servicer an intention to refinance
the related Mortgage Loan and (y) the related Servicer has concluded in its
reasonable judgment that the waiver of such Prepayment Charge would induce
such
Mortgagor to refinance with such Servicer, (iii) the related Servicer reasonably
believes such Prepayment Charge is unenforceable in accordance with applicable
law or the collection of such related Prepayment Charge would otherwise violate
applicable law or (iv) the related Servicer has not been provided with
information sufficient to enable it to collect the Prepayment Charge. If a
Prepayment Charge is waived as permitted by meeting both of the standards
described in clauses (i) and (ii)(B) above, then the related Servicer is
required to pay the amount of such waived Prepayment Charge (the “Servicer
Prepayment Charge Payment Amount”), for the benefit of the Holders of the Class
P Certificates, by depositing such amount into the related Custodial Account
within ninety (90) days of notice or discovery of such waiver meeting the
standard set forth in both clauses (i) and (ii)(B) above; provided, however,
that the related Servicer shall not waive more than five-percent (5%) of the
Prepayment Charges (by number of Prepayment Charges) set forth on the Prepayment
Charge Schedule in accordance with clauses (i) and (ii)(B) above.
Notwithstanding any other provisions of this Agreement, any payments made by
a
Servicer in respect of any waived Prepayment Charges pursuant to clauses (i)
and
(ii)(B) above and the preceding sentence shall be deemed to be paid outside
of
the Trust Fund.
Subject
only to the above-described applicable servicing standards (the “Accepted
Servicing Practices”) and the terms of this Agreement and of the respective
Mortgage Loans, each Servicer shall have full power and authority, acting alone
and/or through subservicers as provided in Section 3.03, to do or cause to
be done any and all things that it may deem necessary or desirable in connection
with such servicing and administration, including but not limited to, the power
and authority, subject to the terms hereof (i) to execute and deliver, on behalf
of the Certificateholders and the Trustee, customary consents or waivers and
other instruments and documents, (ii) to consent to transfers of any related
Mortgaged Property and assumptions of the Mortgage Notes and related Mortgages
(but only in the manner provided herein), (iii) to collect any Insurance
Proceeds and other Liquidation Proceeds, and (iv) subject to Section 3.09,
to effectuate foreclosure or other conversion of the ownership of the Mortgaged
Property securing any Mortgage Loan serviced by such Servicer.
Without
limiting the generality of the foregoing, each Servicer, in its own name or
in
the name of the Trust, the Depositor or the Trustee, is hereby authorized and
empowered by the Trust, the Depositor and the Trustee, when such Servicer
believes it appropriate in its reasonable judgment, to execute and deliver,
on
behalf of the Trustee, the Depositor, the Certificateholders or any of them,
any
and all instruments of satisfaction or cancellation, or of partial or full
release or discharge and all other comparable instruments, with respect to
the
related Mortgage Loans, and with respect to the related Mortgaged Properties
held for the benefit of the Certificateholders. Each Servicer shall prepare
and
deliver to the Depositor and/or the Trustee such documents requiring execution
and delivery by any or all of them as are necessary or appropriate to enable
such Servicer to service and administer the related Mortgage Loans. Upon receipt
of such documents, the Depositor and/or the Trustee shall execute such documents
and deliver them to the related Servicer. In addition, the Trustee shall
execute, at the written request of a Servicer, and furnish to such Servicer
any
special or limited powers of attorney in the form of Exhibit
S
hereto
applicable to all locations in which the Mortgaged Properties are located and
other documents necessary or appropriate to enable the related Servicer to
carry
out its servicing and administrative duties hereunder, provided such limited
powers of attorney or other documents shall be prepared by the related Servicer
and submitted to the Trustee for review prior to execution. Notwithstanding
anything to the contrary herein, the Trustee shall in no way be liable or
responsible for the willful malfeasance of a Servicer, or for the wrongful
or
negligent actions taken by such Servicer, while such Servicer is acting pursuant
to the powers granted to it in this paragraph.
In
accordance with the standards of the first paragraph of this Section 3.01,
each Servicer shall advance or cause to be advanced funds as necessary for
the
purpose of effecting the payment of taxes and assessments on the Mortgaged
Properties relating to the Mortgage Loans serviced by such Servicer in order
to
preserve the lien on the Mortgaged Property, which advances shall be
reimbursable in the first instance from related collections from the Mortgagors
pursuant to Section 3.27, and further as provided in Section 3.32. All
costs incurred by a Servicer, if any, in effecting the payments of such taxes
and assessments on the related Mortgaged Properties and related insurance
premiums shall not, for the purpose of calculating monthly distributions to
the
Certificateholders, be added to the Stated Principal Balance under the related
Mortgage Loans, notwithstanding that the terms of such Mortgage Loans so permit.
Section
3.02 Due-on-Sale
Clauses; Assumption Agreements.
(a) Except
as
otherwise provided in this Section 3.02, when any Mortgaged Property has
been or is about to be conveyed by the Mortgagor, the related Servicer shall
to
the extent that it has knowledge of such conveyance, enforce any due-on-sale
clause contained in the related Mortgage Note or Mortgage, to the extent
permitted under applicable law and governmental regulations, but only to the
extent that such enforcement will not adversely affect or jeopardize coverage
under any Required Insurance Policy. Notwithstanding the foregoing, no Servicer
shall be required to exercise such rights with respect to a Mortgage Loan
serviced by such Servicer if the Person to whom the related Mortgaged Property
has been conveyed or is proposed to be conveyed satisfies the terms and
conditions contained in the Mortgage Note and Mortgage related thereto and
the
consent of the mortgagee under such Mortgage Note or Mortgage is not otherwise
so required under such Mortgage Note or Mortgage as a condition to such
transfer. In the event that a Servicer is prohibited by law from enforcing
any
such due-on-sale clause, or if coverage under any Required Insurance Policy
would be adversely affected, or if nonenforcement is otherwise permitted
hereunder, such Servicer is authorized, subject to Section 3.02(b), to take
or enter into an assumption and modification agreement from or with the person
to whom such property has been or is about to be conveyed, pursuant to which
such person becomes liable under the Mortgage Note and, unless prohibited by
applicable state law, the Mortgagor remains liable thereon, provided that the
related Mortgage Loan shall continue to be covered (if so covered before the
related Servicer enters into such an agreement) by the applicable Required
Insurance Policies. With respect to any Mortgage Loan, the related Servicer,
subject to Section 3.02(b), is also authorized with the prior approval of
the insurers under any Required Insurance Policies to enter into a substitution
of liability agreement with such Person, pursuant to which the original
Mortgagor is released from liability and such Person is substituted as Mortgagor
and becomes liable under the Mortgage Note. Notwithstanding the foregoing,
the
related Servicer shall not be deemed to be in default under this
Section 3.02(a) by reason of any transfer or assumption that it reasonably
believes it is restricted by law from preventing.
(b) Subject
to a Servicer’s duty to enforce any due-on-sale clause to the extent set forth
in Section 3.02(a), in any case in which a Mortgaged Property has been
conveyed to a Person by a Mortgagor, and such Person is to enter into an
assumption agreement or modification agreement or supplement to the Mortgage
Note or Mortgage that requires the signature of the Trustee, or if an instrument
of release signed by the Trustee is required releasing the Mortgagor from
liability on the related Mortgage Loan, such Servicer shall prepare and deliver
or cause to be prepared and delivered to the Trustee for signature and shall
direct, in writing, the Trustee to execute the assumption agreement with the
Person to whom the Mortgaged Property is to be conveyed and such modification
agreement or supplement to the Mortgage Note or Mortgage or other instruments
as
are reasonable or necessary to carry out the terms of the Mortgage Note or
Mortgage or otherwise to comply with any applicable laws regarding assumptions
or the transfer of the Mortgaged Property to such Person. In connection with
any
such assumption, no material term of the Mortgage Note (including, but not
limited to, the Mortgage Rate, the amount of the Scheduled Payment, the Index,
Gross Margin, Periodic Rate Cap, Adjustment Date, Maximum Interest Rate or
Minimum Mortgage Interest Rate, and any other term affecting the amount or
timing of payment on the related Mortgage Loan) may be changed. In addition,
the
substitute Mortgagor and the Mortgaged Property must be acceptable to the
Servicer in accordance with the servicing standard set forth in
Section 3.01. The related Servicer shall notify the Trustee that any such
substitution or assumption agreement has been completed by forwarding to the
Custodian the original of such substitution or assumption agreement, which
in
the case of the original shall be added to the related Mortgage File and shall,
for all purposes, be considered a part of such Mortgage File to the same extent
as all other documents and instruments constituting a part thereof. Any fee
collected by a Servicer for entering into an assumption or substitution of
liability agreement will be retained by such Servicer as additional servicing
compensation.
Section
3.03 Subservicers.
Each
Servicer shall perform all of its servicing responsibilities hereunder or may
cause a Subservicer to perform any such servicing responsibilities on its
behalf, but the use by a Servicer of a Subservicer shall not release such
Servicer from any of its obligations hereunder with respect to the related
Mortgage Loans. Any subservicing arrangement and the terms of the related
Subservicing Agreement must provide for the servicing of such Mortgage Loans
in
a manner consistent with the servicing arrangements contemplated hereunder
and
the related Servicer shall cause any Subservicer to comply with the provisions
of this Agreement (including, without limitation, to provide the information
required to be delivered under Sections 3.13, 3.14 and 3.18 hereof), to the
same
extent as if such Subservicer were the Servicer. Each Subservicer shall be
(i)
authorized to transact business in the state or states where the related
Mortgaged Properties it is to service are situated, if and to the extent
required by applicable law to enable the Subservicer to perform its obligations
hereunder and under the Subservicing Agreement and (ii) a Xxxxxxx Mac or Xxxxxx
Mae approved mortgage servicer. Each Servicer shall promptly, upon request,
provide to the Master Servicer and the Depositor a written description (in
form
and substance reasonably satisfactory to the Master Servicer and the Depositor)
of the role and function of each Subservicer utilized by such Servicer,
specifying (i) the identity of each such Subservicer, (ii) which (if any) of
such Subservicer are “participating in the servicing function” within the
meaning of Item 1122 of Regulation AB, and (iii) which elements of the Servicing
Criteria will be addressed in assessments of compliance provided by each
Subservicer identified pursuant to clause (ii) of this subsection; provided,
however, no Servicer shall be required to provide the information in clause
(i)
or (ii) of this subsection until such time that the applicable assessment of
compliance is due in accordance with Section 3.14 of this Agreement. Each
Servicer shall be responsible for obtaining from each Subservicer engaged by
it
and delivering to the Master Servicer any annual statement of compliance,
assessment of compliance, attestation report and Xxxxxxxx-Xxxxx related
certification required to be delivered by such Subservicer under Sections 3.13,
3.14 and 3.18, in each case, as and when required to be delivered. Each Servicer
shall pay all fees of any Subservicers engaged by it from its own
funds.
Notwithstanding
the foregoing, with respect to the related Mortgage Loans, the related Servicer
shall be entitled to outsource one or more separate servicing functions to
any
Person that does not meet the eligibility requirements for a Subservicer (each
such Person, a “Subcontractor”), so long as such outsourcing does not constitute
the delegation of such Servicer’s obligation to perform all or substantially all
of the servicing of the related Mortgage Loans to such Subcontractor. The
related Servicer shall promptly, upon request, provide to the Master Servicer,
the Trustee and the Depositor a written description (in form and substance
reasonably satisfactory to the Master Servicer, the Trustee and the Depositor)
of the role and function of each Subcontractor utilized by such Servicer,
specifying (i) the identity of each such Subcontractor “participating in the
servicing function” within the meaning of Item 1122 of Regulation AB and (ii)
which elements of the Servicing Criteria will be addressed in assessments of
compliance provided by each such Subcontractor identified pursuant to clause
(i)
of this subsection. In such event, the use by a Servicer of any such
Subcontractor shall not release such Servicer from any of its obligations
hereunder and such Servicer shall remain responsible hereunder for all acts
and
omissions of such Subcontractor as fully as if such acts and omissions were
those of such Servicer, and such Servicer shall pay all fees and expenses of
the
Subcontractor from such Servicer’s own funds.
As
a
condition to the utilization of any Subcontractor determined to be
“participating in the servicing function” within the meaning of Item 1122 of
Regulation AB, each Servicer shall cause any such Subcontractor used by it
for
the benefit of the Master Servicer and the Depositor to comply with the
provisions of Sections 3.13, 3.14 and 3.18 of this Agreement to the same extent
as if such Subcontractor were such Servicer. Each Servicer shall be responsible
for obtaining from each Subcontractor engaged by it and delivering to the Master
Servicer, the Trustee and any Depositor any annual statement of compliance,
assessment of compliance, attestation report and Xxxxxxxx-Xxxxx related
certification required to be delivered by such Subcontractor under Sections
3.13, 3.14 and 3.18, in each case as and when required to be
delivered.
At
the
cost and expense of the related Servicer, without any right of reimbursement
from its Custodial Account, such Servicer shall be entitled to terminate the
rights and responsibilities of a Subservicer or Subcontractor and arrange for
any servicing responsibilities to be performed by a successor Subservicer or
Subcontractor; provided, however, that nothing contained herein shall be deemed
to prevent or prohibit a Servicer, at its option, from electing to service
the
related Mortgage Loans itself. In the event that a Servicer’s responsibilities
and duties under this Agreement are terminated pursuant to Section 8.01,
such Servicer shall at its own cost and expense terminate the rights and
responsibilities of each Subservicer and Subcontractor with respect to the
related Mortgage Loans effective as of the date of such Servicer’s termination.
Each Servicer shall pay all fees, expenses or penalties necessary in order
to
terminate the rights and responsibilities of each Subservicer and Subcontractor
from such Servicer’s own funds without reimbursement from the Trust
Fund.
Notwithstanding
the foregoing, no Servicer shall be relieved of its obligations hereunder with
respect to the related Mortgage Loans and shall be obligated to the same extent
and under the same terms and conditions as if it alone were servicing and
administering the related Mortgage Loans. Each Servicer shall be entitled to
enter into an agreement with a Subservicer or Subcontractor, as applicable,
engaged by it for indemnification of such Servicer by the Subservicer or
Subcontractor, as applicable, and nothing contained in this Agreement shall
be
deemed to limit or modify such indemnification.
Any
Subservicing Agreement and any other transactions or services relating to the
Mortgage Loans involving a Subservicer or Subcontractor shall be deemed to
be
between such Subservicer or Subcontractor and the related Servicer alone, and
neither the Master Servicer nor the Trustee shall have any obligations, duties
or liabilities with respect to such Subservicer or Subcontractor including
any
obligation, duty or liability of Master Servicer or the Trustee to pay such
Subservicer’s or Subcontractor’s fees and expenses. For purposes of remittances
to the Securities Administrator pursuant to this Agreement, a Servicer shall
be
deemed to have received a payment on a Mortgage Loan serviced by such Servicer
when a Subservicer or Subcontractor has received such payment.
Section
3.04 Documents,
Records and Funds in Possession of the Servicers To Be Held for
Trustee.
Notwithstanding
any other provisions of this Agreement, each Servicer shall transmit to the
Trustee as required by this Agreement all documents and instruments in respect
of a Mortgage Loan serviced by such Servicer coming into the possession of
such
Servicer from time to time and shall account fully to the Securities
Administrator for any funds received by such Servicer or that otherwise are
collected by such Servicer as Liquidation Proceeds or Insurance Proceeds in
respect of any such Mortgage Loan. All Mortgage Files and funds collected or
held by, or under the control of, a Servicer in respect of any Mortgage Loans
serviced by such Servicer, whether from the collection of principal and interest
payments or from Liquidation Proceeds, including but not limited to, any funds
on deposit in the related Custodial Account, shall be held by such Servicer
for
and on behalf of the Trustee and shall be and remain the sole and exclusive
property of the Trustee, subject to the applicable provisions of this Agreement.
Each Servicer also agrees that it shall not create, incur or subject any
Mortgage File or any funds that are deposited in the related Custodial Account,
the Distribution Account or in any Escrow Account, or any funds that otherwise
are or may become due or payable to the Trustee for the benefit of the
Certificateholders, to any claim, lien, security interest, judgment, levy,
writ
of attachment or other encumbrance, or assert by legal action or otherwise
any
claim or right of set off against any Mortgage File or any funds collected
on,
or in connection with, a related Mortgage Loan, except, however, that the
related Servicer shall be entitled to set off against and deduct from any such
funds any amounts that are properly due and payable to it under this
Agreement.
Section
3.05 Maintenance
of Hazard Insurance.
(a) Each
Servicer shall cause to be maintained for each related Mortgage Loan hazard
insurance with extended coverage on the Mortgaged Property in an amount which
is
at least equal to the lesser of (i) the Stated Principal Balance of such
Mortgage Loan and (ii) the amount necessary to fully compensate for any damage
or loss to the improvements that are a part of such property on a replacement
cost basis, in each case in an amount not less than such amount as is necessary
to avoid the application of any coinsurance clause contained in the related
hazard insurance policy. Each Servicer shall also cause to be maintained hazard
insurance with extended coverage on each related REO Property in an amount
which
is at least equal to the lesser of (i) the maximum insurable value of the
improvements which are a part of such REO Property and (ii) the Stated Principal
Balance of the related Mortgage Loan at the time it became an REO Property.
Each
Servicer will comply in the performance of this Agreement with all reasonable
rules and requirements of each insurer under any such hazard policies. Any
amounts collected by a Servicer under any such policies (other than amounts
to
be applied to the restoration or repair of the property subject to the related
Mortgage or amounts to be released to the Mortgagor in accordance with the
procedures that such Servicer would follow in servicing loans held for its
own
account, subject to the terms and conditions of the related Mortgage and
Mortgage Note and in accordance with the servicing standard set forth in
Section 3.01) shall be deposited in the related Custodial Account, subject
to withdrawal pursuant to Section 3.27. Any cost incurred by a Servicer in
maintaining any such insurance shall not, for the purpose of calculating
distributions to Certificateholders, be added to the Stated Principal Balance
of
the related Mortgage Loan, notwithstanding that the terms of such Mortgage
Loan
so permit. It is understood and agreed that no earthquake or other additional
insurance is to be required of any Mortgagor other than pursuant to such
applicable laws and regulations as shall at any time be in force and as shall
require such additional insurance. If a Mortgaged Property or REO Property
is at
any time in an area identified in the Federal Register by the Federal Emergency
Management Agency as having special flood hazards and flood insurance has been
made available, the related Servicer shall cause to be maintained a flood
insurance policy in respect thereof. Such flood insurance shall be in an amount
equal to the lesser of (i) the Stated Principal Balance of the related Mortgage
Loan and (ii) the maximum amount of such insurance available for the related
Mortgaged Property under the national flood insurance program (assuming that
the
area in which such Mortgaged Property is located is participating in such
program).
In
the
event that a Servicer shall obtain and maintain a blanket policy with an insurer
having a General Policy Rating of B:VI or better in Best’s Key Rating Guide (or
such other rating that is comparable to such rating) insuring against hazard
losses on all of the related Mortgage Loans, it shall conclusively be deemed
to
have satisfied its obligations as set forth in the first two sentences of this
Section 3.05, it being understood and agreed that such policy may contain a
deductible clause, in which case such Servicer shall, in the event that there
shall not have been maintained on the related Mortgaged Property or REO Property
a policy complying with the first two sentences of this Section 3.05, and
there shall have been one or more losses which would have been covered by such
policy, deposit to the related Custodial Account from its own funds the amount
not otherwise payable under the blanket policy because of such deductible
clause. In connection with its activities as administrator and servicer of
the
related Mortgage Loans, each Servicer agrees to prepare and present, on behalf
of itself, the Trustee and Certificateholders, claims under any such blanket
policy in a timely fashion in accordance with the terms of such
policy.
(b) Each
Servicer shall keep in force during the term of this Agreement a policy or
policies of insurance covering errors and omissions for failure in the
performance of its obligations under this Agreement, which policy or policies
shall be in such form and amount that would meet the requirements of Xxxxxx
Xxx
or Xxxxxxx Mac if it were the purchaser of the Mortgage Loans, unless such
Servicer has obtained a waiver of such requirements from Xxxxxx Mae or Xxxxxxx
Mac. Each Servicer shall provide the Master Servicer, upon request, with copies
of such insurance policies and fidelity bond (or waiver thereof). Each Servicer
shall also maintain a fidelity bond in the form and amount that would meet
the
requirements of Xxxxxx Mae or Xxxxxxx Mac, unless such Servicer has obtained
a
waiver of such requirements from Xxxxxx Mae or Xxxxxxx Mac. Each Servicer shall
be deemed to have complied with this provision if one of its Affiliates has
such
errors and omissions and fidelity bond coverage and, by the terms of such
insurance policy or fidelity bond, the coverage afforded thereunder extends
to
the Servicer. Any such errors and omissions policy and fidelity bond shall
by
its terms not be cancelable without thirty (30) days’ prior written notice to
the Master Servicer. Each Servicer shall also cause its subservicers to maintain
a policy of insurance covering errors and omissions and a fidelity bond which
would meet such requirements.
Section
3.06 Presentment
of Claims and Collection of Proceeds.
Each
Servicer shall prepare and present on behalf of the Trustee and the
Certificateholders all claims under the applicable Insurance Policies and take
such reasonable actions (including the negotiation, settlement, compromise
or
enforcement of the insured’s claim) as shall be necessary to permit recovery
under such Insurance Policies. Any proceeds disbursed to a Servicer in respect
of such Insurance Policies shall, within two Business Days of its receipt,
be
deposited in the related Custodial Account, except that any amounts realized
that are to be applied to the repair or restoration of the related Mortgaged
Property as a condition precedent to the presentation of claims on the related
Mortgage Loan to the insurer under any applicable Insurance Policy need not
be
so deposited (or remitted). Notwithstanding any provision to the contrary,
no
Servicer shall have any responsibility to a primary mortgage insurance policy
unless it has been made aware of such policy, as reflected on the Mortgage
Loan
Schedule or otherwise and has been provided with adequate information to
administer such policy.
Section
3.07 Maintenance
of Insurance Policies.
Except
as
required by applicable law or the related Mortgage Loan documents, no Servicer
shall take any action that would result in noncoverage under any applicable
Insurance Policy of any loss which, but for the actions of such Servicer would
have been covered thereunder. Each Servicer shall use its best efforts to keep
in force and effect (to the extent that the related Mortgage Loan requires
the
Mortgagor to maintain such insurance), any applicable Insurance Policy. No
Servicer shall not cancel or refuse to renew any Insurance Policy that is in
effect at the date of the initial issuance of a Mortgage Note and is required
to
be kept in force hereunder.
Section
3.08 Reserved.
Section
3.09 Realization
Upon Defaulted Mortgage Loans; Determination of Excess Liquidation Proceeds
and
Realized Losses; Repurchases of Certain Mortgage Loans.
(a) Each
Servicer shall use reasonable efforts to foreclose upon or otherwise comparably
convert the ownership of properties securing such of the related Mortgage Loans
as come into and continue in default and as to which no satisfactory
arrangements can be made for collection of delinquent payments. In connection
with such foreclosure or other conversion, the related Servicer shall follow
such practices and procedures as it shall deem necessary or advisable and as
shall be normal and usual in its general mortgage servicing activities and
the
requirements of the insurer under any Required Insurance Policy; provided that
the related Servicer shall not be required to expend its own funds in connection
with any foreclosure or towards the restoration of any property unless it shall
determine (i) that such restoration and/or foreclosure will increase the
proceeds of liquidation of the related Mortgage Loan after reimbursement to
itself of such expenses and (ii) that such expenses will be recoverable to
it
through Liquidation Proceeds (respecting which it shall have priority for
purposes of withdrawals from the related Custodial Account). If a Servicer
reasonably believes that Liquidation Proceeds with respect to any such Mortgage
Loan would not be increased as a result of such foreclosure or other action,
such Mortgage Loan will be charged-off and will become a Liquidated Loan. Each
Servicer will give notice of any such charge-off to the Securities
Administrator. Each Servicer shall be responsible for all other costs and
expenses incurred by it in any such proceedings; provided that such costs and
expenses shall be Servicing Advances and that it shall be entitled to
reimbursement thereof from the proceeds of liquidation of the related Mortgaged
Property, as contemplated in Section 3.27. If a Servicer has knowledge that
a Mortgaged Property that it is contemplating acquiring in foreclosure or by
deed-in-lieu of foreclosure is located within a one-mile radius of any site
with
environmental or hazardous waste risks known to it, such Servicer shall, prior
to acquiring the Mortgaged Property, consider such risks and only take action
in
accordance with its established environmental review procedures.
With
respect to any REO Property, the deed or certificate of sale shall be taken
in
the name of the Trustee for the benefit of the Certificateholders (or the
Trustee’s nominee on behalf of the Certificateholders). The Trustee’s name shall
be placed on the title to such REO Property solely as the Trustee hereunder
and
not in its individual capacity. The related Servicer shall ensure that the
title
to such REO Property references this Agreement and the Trustee’s capacity
hereunder. Pursuant to its efforts to sell such REO Property, the related
Servicer shall either itself, or through an agent selected by it, protect and
conserve such REO Property in the same manner and to such extent as is customary
in the locality where such REO Property is located and may, incident to its
conservation and protection of the interests of the Certificateholders, rent
the
same, or any part thereof, as the related Servicer deems to be in the best
interest of the related Servicer and the Certificateholders for the period
prior
to the sale of such REO Property. Each Servicer shall prepare for and deliver
to
the Securities Administrator a statement with respect to each REO Property
that
has been rented showing the aggregate rental income received and all expenses
incurred in connection with the management and maintenance of such REO Property
at such times as is necessary to enable the Securities Administrator to comply
with the reporting requirements of the REMIC Provisions. The net monthly rental
income, if any, from such REO Property shall be deposited in the related
Custodial Account no later than the close of business on each Determination
Date. Each Servicer shall perform the tax reporting and withholding related
to
foreclosures, abandonments and cancellation of indebtedness income as specified
by Sections 6050H, 6050J and 6050P of the Code by preparing and filing such
tax
and information returns, as may be required.
In
the
event that the Trust Fund acquires any Mortgaged Property as aforesaid or
otherwise in connection with a default or imminent default on a Mortgage Loan,
the Servicer shall dispose of such Mortgaged Property prior to three years
after
its acquisition by the Trust Fund or, at the expense of the Trust Fund, request
from the Internal Revenue Service more than 60 days prior to the day on which
such three-year period would otherwise expire, an extension of the three-year
grace period. The Trustee and the Securities Administrator shall be supplied
with an Opinion of Counsel (such opinion not to be an expense of the Trustee,
the Securities Administrator or the Trust Fund) to the effect that the holding
by the Trust Fund of such Mortgaged Property subsequent to such three-year
period will not result in the imposition of taxes on “prohibited transactions”
of REMIC I, REMIC II, REMIC III, REMIC IV, REMIC V or REMIC VI as defined in
section 860F of the Code or cause either REMIC I, REMIC II, REMIC III, REMIC
IV,
REMIC V or REMIC VI to fail to qualify as a REMIC at any time that any
Certificates are outstanding, in which case the Trust Fund may continue to
hold
such Mortgaged Property (subject to any conditions contained in such Opinion
of
Counsel). Notwithstanding any other provision of this Agreement, no Mortgaged
Property acquired by the Trust Fund shall be rented (or allowed to continue
to
be rented) or otherwise used for the production of income by or on behalf of
the
Trust Fund in such a manner or pursuant to any terms that would (i) cause such
Mortgaged Property to fail to qualify as “foreclosure property” within the
meaning of section 860G(a)(8) of the Code or (ii) subject either REMIC I, REMIC
II, REMIC III, REMIC IV, REMIC V or REMIC VI to the imposition of any federal,
state or local income taxes on the income earned from such Mortgaged Property
under section 860G(c) of the Code or otherwise, unless the Servicer has agreed
to indemnify and hold harmless the Trust Fund with respect to the imposition
of
any such taxes.
The
decision of a Servicer to foreclose on a defaulted Mortgage Loan shall be
subject to a determination by such Servicer that the proceeds of such
foreclosure would exceed the costs and expenses of bringing such a proceeding.
The income earned from the management of any Mortgaged Properties acquired
through foreclosure or other judicial proceeding, net of reimbursement to the
related Servicer for expenses incurred (including any property or other taxes)
in connection with such management and net of unreimbursed Servicing Fees,
unreimbursed Master Servicing Fees, Advances, Servicing Advances and any
management fee paid or to be paid with respect to the management of such
Mortgaged Property, shall be applied to the payment of principal of, and
interest on, the defaulted Mortgage Loans (with interest accruing as though
such
Mortgage Loans were still current) and all such income shall be deemed, for
all
purposes in the Agreement, to be payments on account of principal and interest
on the related Mortgage Notes and shall be deposited into the related Custodial
Account. To the extent the income received during a Prepayment Period is in
excess of the amount attributable to amortizing principal and accrued interest
at the related Mortgage Rate on the related Mortgage Loan, such excess shall
be
considered to be a partial Principal Prepayment for all purposes
hereof.
The
Liquidation Proceeds from any liquidation of a Mortgage Loan, net of any payment
to the related Servicer as provided above, shall be deposited in the related
Custodial Account on the next succeeding Determination Date following receipt
thereof for distribution on the related Distribution Date, except that any
Excess Liquidation Proceeds shall be retained by the related Servicer as
additional servicing compensation.
The
proceeds of any Liquidated Loan, as well as any recovery resulting from a
partial collection of Liquidation Proceeds or any income from an REO Property,
shall be applied in the following order of priority: first, to reimburse the
Servicer for any related unreimbursed Servicing Advances and Servicing Fees,
pursuant to Section 3.27 or this Section 3.09; second, to reimburse
the Servicer for any unreimbursed Advances, pursuant to Section 3.27 or
this Section 3.09; third, to accrued and unpaid interest (to the extent no
Advance has been made for such amount) on the Mortgage Loan or related REO
Property, at the Net Mortgage Rate to the first day of the month in which such
amounts are required to be distributed; and fourth, as a recovery of principal
of the Mortgage Loan.
(b) On
each
Determination Date, each Servicer shall determine the respective aggregate
amounts of Excess Liquidation Proceeds and Realized Losses, if any, with respect
to any Mortgage Loan serviced by it for the related Prepayment Period and report
the same to the Securities Administrator pursuant to Section 3.28.
(c) No
Servicer has any intent to foreclose on any Mortgage Loan based on the
delinquency characteristics as of the Closing Date; provided, however, that
the
foregoing does not prevent a Servicer from initiating foreclosure proceedings
on
any date hereafter if the facts and circumstances of such Mortgage Loans,
including delinquency characteristics, in such Servicer’s discretion so warrant
such action.
Section
3.10 Servicing
Compensation.
As
compensation for its activities hereunder, each Servicer shall be entitled
to
retain or withdraw from the related Custodial Account out of each payment of
interest on each Mortgage Loan serviced by it included in the Trust Fund an
amount equal to the Servicing Fee. In addition, each Servicer shall be entitled
to recover any unpaid Servicing Fees payable to it out of Liquidation Proceeds,
Insurance Proceeds or condemnation proceeds related to the Mortgage Loans
serviced by the Servicer to the extent permitted by
Section 3.27.
Additional
servicing compensation with respect to Mortgage Loans in the form of any Excess
Liquidation Proceeds, Prepayment Interest Excess, if applicable, assumption
fees, late payment charges, insufficient funds charges and ancillary income
to
the extent such fees or charges are received by the related Servicer, all income
and gain net of any losses realized from Permitted Investments with respect
to
funds in or credited to the related Custodial Account shall be retained by
the
related Servicer to the extent not required to be deposited in the related
Custodial Account pursuant to Section 3.27. Each Servicer shall be required
to pay all expenses incurred by it in connection with its servicing activities
hereunder (including payment of any premiums for hazard insurance, as required
by Section 3.05 and maintenance of the other forms of insurance coverage
required by Section 3.07 and shall not be entitled to reimbursement
therefor except as specifically provided herein.
Section
3.11 REO
Property.
(a) In
the
event the Trust Fund acquires ownership of any REO Property in respect of any
related Mortgage Loan, the deed or certificate of sale shall be issued to the
Trustee, or to its nominee, on behalf of the related Certificateholders. The
related Servicer shall sell any REO Property as expeditiously as possible and
in
accordance with the provisions of this Agreement. Pursuant to its efforts to
sell such REO Property, the related Servicer shall protect and conserve such
REO
Property in the manner and to the extent required herein, in accordance with
the
REMIC Provisions.
(b) Each
Servicer shall deposit all funds collected and received in connection with
the
operation of any REO Property into the related Custodial Account.
(c) The
related Servicer, upon the final disposition of any REO Property, shall be
entitled to reimbursement for any related unreimbursed Advances, unreimbursed
Servicing Advances or Servicing Fees from Liquidation Proceeds received in
connection with the final disposition of such REO Property; provided, that
any
such unreimbursed Advances or Servicing Fees as well as any unpaid Servicing
Fees may be reimbursed or paid, as the case may be, prior to final disposition,
out of any net rental income or other net amounts derived from such REO
Property.
Section
3.12 Liquidation
Reports.
Upon
the
foreclosure of any Mortgaged Property or the acquisition thereof by the Trust
Fund pursuant to a deed-in-lieu of foreclosure, the related Servicer shall
submit a liquidation report to the Trustee containing such information as shall
be mutually acceptable to it and the Trustee with respect to such Mortgaged
Property.
Section
3.13 Annual
Statement as to Compliance.
(a) Each
of
the Servicers, the Master Servicer and the Securities Administrator shall
deliver (and shall cause each Servicing Function Participant engaged by it
to
deliver) or otherwise make available to the Depositor and the Securities
Administrator on or before March 15 of each year, commencing in March 2008,
an
Officer’s Certificate stating, as to the signer thereof, that (A) a review of
such party’s activities during the preceding calendar year or portion thereof
and of such party’s performance under this Agreement has been made under such
officer’s supervision and (B) to the best of such officer’s knowledge, based on
such review, such party has fulfilled all its obligations under this Agreement
in all material respects throughout such year or portion thereof, or, if there
has been a failure to fulfill any such obligation in any material respect,
specifying each such failure known to such officer and the nature and status
thereof.
(b) (i)For
so
long as the Trust Fund is subject to Exchange Act reporting requirements,
failure of the Servicer to comply timely with this Section 3.13 shall be deemed
a Servicer Default, without any cure period, and the Master Servicer may, in
addition to whatever rights the Master Servicer may have under this Agreement
and at law or in equity or to damages, including injunctive relief and specific
performance, terminate all the rights and obligations of the related Servicer
under this Agreement or under the Servicing Agreement, as applicable, and in
and
to the related Mortgage Loans and the proceeds thereof without compensating
the
related Servicer for the same. The Master Servicer shall so terminate a Servicer
by delivery of notice thereof via first class mail, facsimile or electronic
mail. This paragraph shall supersede any other provision in this Agreement
or
any other agreement to the contrary other than the final paragraph of Section
8.01(a).
(ii) After
the
Trust Fund ceases to be subject to Exchange Act reporting requirements, failure
of a Servicer to duly perform its obligations under this Section 3.13 on or
before March 31 of each such year or failure to cure such default after the
period of ten (10) Business Days as provided in Section 8.01(a)(ix) shall be
deemed a Servicer Default as provided for in Section 8.01(a)(ix) or pursuant
to
the Servicing Agreement. The Master Servicer may terminate such Servicer by
delivery of notice thereof via first class mail, facsimile or electronic
mail.
(c) The
Master Servicer shall include all annual statements of compliance received
by it
from the Servicers with its own annual statement of compliance to be submitted
to the Securities Administrator pursuant to this Section 3.13.
(d) Copies
of
any Master Servicer annual statements of compliance required to be delivered
hereunder shall be provided to any Certificateholder upon request at the Master
Servicer’s expense.
(e) In
the
event a Servicer, the Master Servicer or the Securities Administrator is
terminated or resigns pursuant to the terms of this Agreement, such party shall
provide an Officer’s Certificate pursuant to this Section 3.13 with respect to
the period of time it was subject to this Agreement or the Servicing Agreement,
as applicable, notwithstanding any such termination, assignment or
resignation.
Section
3.14 Assessments
of Compliance and Attestation Reports.
(a) By
March
15 of
each
year, commencing in March 2008,
each
Servicer, the Master Servicer and the Securities Administrator, each at its
own
expense and pursuant to Item 1122(a) of Regulation AB, shall furnish or
otherwise make available, and shall cause any Servicing Function Participant
engaged by it to furnish, which in each case shall not be an expense of the
Trust Fund, to the Securities Administrator and the Depositor, a report on
an
assessment of compliance with the Relevant Servicing Criteria that contains
(A)
a statement by such party of its responsibility for assessing compliance with
the Relevant Servicing Criteria, (B) a statement that such party used the
Relevant Servicing Criteria to assess compliance with the Relevant Servicing
Criteria, (C) such party’s assessment of compliance with the Relevant Servicing
Criteria for the period consisting of the prior calendar year, including, if
there has been any material instance of noncompliance with the Relevant
Servicing Criteria, a discussion of each such failure and the nature and status
thereof, and (D) a statement that a registered public accounting firm has issued
an attestation report on such party’s assessment of compliance with the Relevant
Servicing Criteria for the period consisting of the prior calendar year;
provided, however, notwithstanding anything herein to the contrary, no
assessment of compliance will be required with respect to any Subcontractor
(whether or not such party is a Servicing Function Participant) in any such
given year in which a Form 10-K is not required to be filed under the Exchange
Act with respect to the Trust Fund.
(b) No
later
than February 1 of each year, commencing in February 2008, each Servicer and
the
Master Servicer shall forward to the Securities Administrator and the Depositor
the name of each Servicing Function Participant engaged by it (other than a
Subcontractor for which an assessment of compliance is not required pursuant
to
the proviso in the immediately preceding paragraph) and what Relevant Servicing
Criteria will be addressed in the report on assessment of compliance prepared
by
such Servicing Function Participant (provided, however, that the Master Servicer
need not provide such information to the Securities Administrator so long as
the
Master Servicer and the Securities Administrator are the same entity). When
the
Servicers and the Master Servicer (or, to the extent required, any Servicing
Function Participant engaged by either of them) submit their assessments of
compliance to the Securities Administrator, such parties will also at such
time
include the assessment of compliance (and attestation pursuant to paragraph
(c)
below) of each Servicing Function Participant engaged by it.
Promptly
after receipt of each such report on assessment of compliance, (i) the Depositor
shall review each such report and, if applicable, consult with the Servicers,
the Master Servicer, the Securities Administrator and any Servicing Function
Participant engaged by such parties as to the nature of any material instance
of
noncompliance with the Relevant Servicing Criteria by each such party, and
(ii)
the Securities Administrator shall confirm that the assessments of compliance,
taken as a whole, address all of the Servicing Criteria and taken individually
address the Relevant Servicing Criteria for each party as set forth on Exhibit
L
and on any similar exhibit set forth in the Servicing Agreement in respect
of
Xxxxx Fargo and notify the Depositor of any exceptions.
In
the
event a Servicing Function Participant is terminated, assigns its rights and
obligations under or resigns pursuant to the terms of this Agreement, or any
other applicable agreement, as the case may be, such party shall provide, or
cause a Servicing Function Participant engaged by it to provide, to the extent
required hereunder, a report on assessment of compliance pursuant to this
Section 3.14 with respect to the period of time it was subject to this Agreement
or any other applicable agreement, as the case may be, notwithstanding any
such
termination, assignment or resignation.
The
Master Servicer shall include all annual reports on assessment of compliance
received by it from the Servicers with its own assessment of compliance to
be
submitted to the Securities Administrator pursuant to this Section.
(c) By
March
15 of each year, commencing in March 2008, the Servicers, the Master Servicer
and the Securities Administrator, each at its own expense, shall cause, and
shall cause any Servicing Function Participant engaged by such party to cause,
which in each case shall not be an expense of the Trust Fund, a registered
public accounting firm (which may also render other services to such Servicing
Function Participants) and that is a member of the American Institute of
Certified Public Accountants to furnish an attestation report to the Master
Servicer, the Securities Administrator and the Depositor to the effect that
(i)
it has obtained a representation regarding certain matters from the management
of such party, which includes an assertion that such party has complied with
the
Relevant Servicing Criteria, and (ii) on the basis of an examination conducted
by such firm in accordance with standards for attestation engagements issued
or
adopted by the PCAOB, it is expressing an opinion as to whether such party’s
compliance with the Relevant Servicing Criteria was fairly stated in all
material respects, or it cannot express an overall opinion regarding such
party’s assessment of compliance with the Relevant Servicing Criteria; however,
notwithstanding anything herein to the contrary, no Subcontractor (whether
or
not such party is a Servicing Function Participant) will be required to deliver
any attestation report in any such given year in which a Form 10-K is not
required under the Exchange Act to be filed with respect to the Trust
Fund.
(d) In
the
event that an overall opinion cannot be expressed, such registered public
accounting firm shall state in such report why it was unable to express such
an
opinion. Such report must be available for general use and not contain
restricted use language.
Promptly
after receipt of each such report on assessment of compliance and attestation
report from a Servicing Function Participant, the Securities Administrator
shall
confirm that each assessment of compliance submitted pursuant to paragraph
(a)
above is coupled with an attestation meeting the requirements of this Section
and notify the Depositor of any exceptions.
The
Master Servicer shall include each such attestation report furnished to it
by
the Servicers with its own attestation to be submitted to the Securities
Administrator pursuant to this Section.
In
the
event any Servicing Function Participant is terminated, assigns its rights
and
obligations under or resigns pursuant to the terms of this Agreement, or any
other applicable agreement, as the case may be, to the extent required
hereunder, such party shall cause a registered public accounting firm to provide
an attestation pursuant to this Section 3.14 or such other agreement with
respect to the period of time it was subject to this Agreement or such other
agreement, as the case may be, notwithstanding any such termination, assignment
or resignation.
(e) (i)For
so
long as the Trust Fund is subject to Exchange Act reporting requirements,
failure of a Servicer to comply timely with this Section 3.14 shall be deemed
a
Servicer Default as to such Servicer in accordance with Section 8.01(a)(viii),
automatically, without notice and without any cure period, and the Master
Servicer may, in addition to whatever rights the Master Servicer may have under
this Agreement and at law or in equity or to damages, including injunctive
relief and specific performance, terminate all the rights and obligations of
such Servicer under this Agreement and in and to the related Mortgage Loans
and
the proceeds thereof without compensating such Servicer for the same. The Master
Servicer shall so terminate such Servicer by delivery of notice thereof via
first class mail, facsimile or electronic mail. This paragraph shall supersede
any other provision in this Agreement or any other agreement to the contrary
other than the final paragraph of Section 8.01(a).
(ii) After
the
Trust Fund ceases to be subject to Exchange Act reporting requirements, failure
of a Servicer to perform its obligations under this Section 3.14 on or before
March 31 of each such year or failure to cure such default after the period
of
ten (10) Business Days as provided in Section 8.01(a)(ix) shall be deemed a
Servicer Default as provided for in Section 8.01(a)(ix). The Master Servicer
may
terminate the Servicer by delivery of notice thereof via first class mail,
facsimile or electronic mail.
(f) For
the
avoidance of doubt, it is understood that the assessments of compliance,
attestation reports and other information required to be provided under this
Section 3.14 shall be based on the activities of the applicable party that
it
performs with respect to asset-backed securities transactions taken as a whole
involving such party that are backed by the same asset type as the Mortgage
Loans.
Section
3.15 Books
and Records.
Each
Servicer shall be responsible for maintaining, and shall maintain, a complete
set of books and records for the related Mortgage Loans which shall be
appropriately identified in the Servicer’s computer system to clearly reflect
the ownership of such Mortgage Loans by the Trust. In particular, each Servicer
shall maintain in its possession, available for inspection by the Trustee and
the Master Servicer and shall deliver to the Trustee or the Master Servicer
upon
reasonable prior request and during normal business hours, evidence of
compliance in all material respects with all federal, state and local laws,
rules and regulations. To the extent that original documents are not required
for purposes of realization of Liquidation Proceeds or Insurance Proceeds,
documents maintained by the related Servicer may be in the form of microfilm
or
microfiche or such other reliable means of recreating original documents,
including, but not limited to, optical imagery techniques so long as the
Servicer complies with the requirements of Accepted Servicing
Practices.
Each
Servicer shall maintain with respect to each Mortgage Loan serviced by it and
shall upon reasonable prior request and during normal business hours make
available for inspection by the Trustee and the Master Servicer the related
servicing file during the time such Mortgage Loan is subject to this Agreement
and thereafter in accordance with applicable law.
Section
3.16 The
Trustee.
The
Trustee shall furnish the Servicer with any powers of attorney and other
documents prepared and submitted by the Servicers to the Trustee in a form
agreeable to the Trustee and necessary or appropriate to enable the Servicers
to
service and administer the related Mortgage Loans and REO
Properties.
The
Trustee shall provide access to the records and documentation in possession
of
the Trustee regarding the related Mortgage Loans and REO Property and the
servicing thereof to the Certificateholders, the FDIC, and the supervisory
agents and examiners of the FDIC, such access being afforded only upon
reasonable prior written request and during normal business hours at the office
of the Trustee; provided, however, that, unless otherwise required by law,
the
Trustee shall not be required to provide access to such records and
documentation if the provision thereof would violate the legal right to privacy
of any Mortgagor. The Trustee shall allow representatives of the above entities
to photocopy any of the records and documentation and shall provide equipment
for that purpose at a charge that covers the Trustee’s actual
costs.
The
Trustee shall execute and deliver as directed in writing by a Servicer any
court
pleadings, requests for trustee’s sale or other documents necessary or desirable
to (i) the foreclosure or trustee’s sale with respect to a Mortgaged Property;
(ii) any legal action brought to obtain judgment against any Mortgagor on the
Mortgage Note; (iii) obtain a deficiency judgment against the Mortgagor; or
(iv)
enforce any other rights or remedies provided by the Mortgage Note or otherwise
available at law or equity.
Section
3.17 REMIC-Related
Covenants.
For
as
long as each REMIC shall exist, the Trustee and the Securities Administrator
shall act in accordance herewith to treat each REMIC as a REMIC, and the Trustee
and the Securities Administrator shall comply with any directions of the
Sponsor, the Servicers or the Master Servicer with respect to such treatment.
In
particular, the Trustee shall not (a) knowingly sell or permit the sale of
all
or any portion of the Mortgage Loans or of any investment of deposits in an
Account unless such sale is as a result of a repurchase of the Mortgage Loans
pursuant to this Agreement or the Trustee has received a REMIC Opinion prepared
at the expense of the Trust Fund; and (b) other than with respect to a
substitution pursuant to the Mortgage Loan Purchase Agreement or
Section 2.04 of this Agreement, as applicable, accept any contribution to
any REMIC after the Startup Day without receipt of a REMIC Opinion.
Section
3.18 Annual
Xxxxxxxx-Xxxxx
Certification; Additional Information.
(a) The
Servicers, the Master Servicer and the Securities Administrator shall and shall
cause any Servicing Function Participant engaged by such party to provide to
the
Certifying Person, by March 15 of each year in which the Trust Fund is subject
to the reporting requirements of the Exchange Act, a certification (each, a
“Back-Up
Certification”),
in
substantially the form attached hereto as Exhibit
M,
upon
which the Certifying Person, the entity for which the Certifying Person acts
as
an officer, and such entity’s officers, directors and Affiliates (collectively
with the Certifying Person, “Certification
Parties”)
can
reasonably rely. The senior officer of the Master Servicer in charge of the
master servicing function shall prepare a Xxxxxxxx-Xxxxx Certification and
sign
the same on behalf of the Trust Fund serving as the “Certifying Person”. Such
officer of the Certifying Person can be contacted by e-mail at or
by
facsimile at (000) 000-0000. In the event a Servicer, the Master Servicer or
the
Securities Administrator, or any Servicing Function Participant engaged by
such
party, is terminated or resigns pursuant to the terms of this Agreement, or
any
other applicable agreement, as the case may be, such party shall provide, to
the
extent required hereunder, a Back-Up Certification to the Certifying Person
pursuant to this Section 3.18 with respect to the period of time it was subject
to this Agreement or any other applicable agreement, as the case may
be.
Notwithstanding
the foregoing, (i) the Master Servicer and the Securities Administrator shall
not be required to deliver a Back-Up Certification to each other if each is
the
same Person and the Master Servicer is the Certifying Person and (ii) the Master
Servicer shall not be obligated to execute any Xxxxxxxx-Xxxxx Certification
in
the event that it does not receive a Back-Up Certification from any party
required to deliver such Back-Up Certification pursuant to this Section, the
Servicing Agreement or the Custodial Agreement; provided, however, in the event
the Master Servicer shall not be required to execute a Xxxxxxxx-Xxxxx
Certification pursuant to clause (ii), the Master Servicer shall prepare such
Xxxxxxxx-Xxxxx Certification and deliver it to the Depositor for
execution.
(b) Each
Servicer shall provide (or shall cause each Subservicer or Subcontractor engaged
by it to provide) to the Master Servicer, the Securities Administrator and
the
Depositor prompt notice and a description of the occurrence of any of the
following:
(i) any
Servicer Default under the terms of this Agreement, any merger, consolidation
or
sale of substantially all of the assets of such Servicer, such Servicer’s
engagement of any Subservicer to perform or assist in the performance of any
of
such Servicer’s obligations under this Agreement, any material litigation or
governmental proceedings involving such Servicer (or its Subservicer or
Subcontractor, as applicable) that is material to any REMIC III
Certificateholder, Class X Certificateholder or Class P Certificateholder and
any affiliation or other significant relationship between such Servicer (or
its
Subservicer or Subcontractor, as applicable) and any other Transaction Parties
and First NLC Financial Services of a type required to be reported under Item
1119 of Regulation AB.
(ii) the
appointment of a Subservicer or a Successor Servicer by a Servicer or its
designee; provided, such notice and description required under this clause
(ii)
shall be delivered at least fifteen (15) calendar days prior to the effective
date of such event and shall be in writing and in form and substance reasonably
satisfactory to the Sponsor, Depositor, Master Servicer and Securities
Administrator in order to comply with the Depositor’s reporting obligations
under Item 6.02 of Form 8-K. Each of the Master Servicer, the Securities
Administrator and the Depositor hereby acknowledge that Popular Mortgage
Servicing Inc. is the initial Subservicer for each of the Equity One Mortgage
Loans.
(iii) If
a
Servicer or any Servicing Function Participant engaged by such Servicer has
knowledge of the occurrence during a particular due period of any of the events
described in this clause (iii), then no later than ten days prior to the
deadline for the filing the next Distribution Report on Form 10-D to be filed
in
respect of the Trust Fund with respect to such Due Period, such Servicer shall
provide (or cause such Subservicer to provide) to the Master Servicer and
Securities Administrator notice of the occurrence of any of the following events
along with all information, data, and materials related thereto as may be
required to be included in such Distribution Report on Form 10-D (as specified
in the provisions of Regulation AB referenced below):
(A) any
material modifications, extensions or waivers of pool asset terms, fees,
penalties or payments during the distribution period or that have cumulatively
become material over time (Item 1121(a)(11) of Regulation AB);
(B) material
breaches of pool asset representations or warranties or transaction covenants
of
such Servicer (Item 1121(a)(12) of Regulation AB); and
(C) information
regarding any material pool asset changes (such as additions, substitutions
or
repurchases).
(c) Each
Servicer shall provide to the Master Servicer and the Securities Administrator
such additional information as the Master Servicer may reasonably request,
including evidence of the authorization of the person signing any certification
or statement, financial information and reports on behalf of such Servicer,
and
of the fidelity bond and errors and omissions insurance policy required to
be
maintained by such Servicer pursuant to this Agreement, and such other
information related to the performance by such Servicer or any Servicing
Function Participant engaged by such Servicer of its obligations hereunder
or
other applicable agreement.
Section
3.19 Release
of Mortgage Files.
(a) Upon
becoming aware of the payment in full of any Mortgage Loan, or the receipt
by
the related Servicer of a notification that payment in full has been escrowed
in
a manner customary for such purposes for payment to Certificateholders on the
next Distribution Date, the related Servicer will (or if such Servicer does
not,
the Master Servicer may) promptly furnish to the Trustee and the Custodian,
on
behalf of the Trustee, two copies of a request for release substantially in
the
form attached to the Custodial Agreement signed by an Authorized Servicer
Representative or in a mutually agreeable electronic format which will, in
lieu
of a signature on its face, originate from an Authorized Servicer Representative
(which certification shall include a statement to the effect that all amounts
received in connection with such payment that are required to be deposited
in
the related Custodial Account pursuant to Article V have been or will be so
deposited) and shall request that the Custodian, on behalf of the Trustee,
deliver to the related Servicer the related Mortgage File. Within three (3)
Business Days of receipt of such certification and request, the Custodian,
on
behalf of the Trustee, shall release the related Mortgage File to the related
Servicer and the Trustee and the Custodian shall have no further responsibility
with regard to such Mortgage File. Upon any such payment in full, the related
Servicer is authorized, to give, as agent for the Trustee, as the mortgagee
under the Mortgage that secured the related 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
related Custodial Account unless determined to be a Servicing
Advance.
(b) From
time
to time and as appropriate for the servicing or foreclosure of any Mortgage
Loan
and in accordance with this Agreement or the Servicing Agreement, as applicable,
the Trustee shall execute such documents as shall be prepared and furnished
to
the Trustee by the related Servicer (in form reasonably acceptable to the
Trustee) and as are necessary to the prosecution of any such proceedings. The
Custodian, on behalf of the Trustee, shall, within three (3) Business Days
following written request of the related Servicer, and delivery to the
Custodian, on behalf of the Trustee, of two copies of a request for release
signed by an Authorized Servicer Representative substantially in the form
attached to the Custodial Agreement (or in a mutually agreeable electronic
format which will, in lieu of a signature on its face, originate from an
Authorized Servicer Representative), release the related Mortgage File held
in
its possession or control to the related Servicer. Such request for release
shall obligate the related Servicer to return the Mortgage File to the Custodian
on behalf of the Trustee, when the need therefor by such Person no longer exists
unless the related Mortgage Loan shall be liquidated, in which case, upon
receipt of a certificate of an Authorized Servicer Representative similar to
that hereinabove specified, the Mortgage File shall be released by the
Custodian, on behalf of the Trustee, to the Servicer.
Section
3.20 Documents,
Records and Funds in Possession of the Servicers to be held for
Trustee.
(a)
Each
Servicer (to the extent required by this Agreement) shall transmit to the
Trustee or the Custodian such documents and instruments coming into its
possession from time to time as are required by the terms hereof to be delivered
to the Trustee or the Custodian. Any funds received by a
Servicer
in
respect of any Mortgage Loan or which otherwise are collected by such Servicer
as Liquidation Proceeds or Insurance Proceeds in respect of any Mortgage Loan
shall be held for the benefit of the Trustee and the Certificateholders subject
to the right of such Servicer to retain its Servicing Fee and other amounts
as
provided in this Agreement.
Section
3.21 Possession
of Certain Insurance Policies and Documents.
Each
Servicer shall retain possession and custody of the originals (to the extent
available) of any Insurance Policies, or certificate of insurance if applicable,
and any certificates of renewal as to the foregoing as may be issued from time
to time that comes into its possession, as contemplated by this Agreement.
Until
all amounts distributable in respect of the Certificates have been distributed
in full, the Trustee (or the Custodian, as directed by the Trustee) shall retain
possession and custody of each Mortgage File in accordance with and subject
to
the terms and conditions of this Agreement.
Section
3.22 [Reserved].
Section
3.23 UCC.
The
Sponsor agrees to execute and file continuation statements for any Uniform
Commercial Code financing statements which the Sponsor has informed the Trustee
were filed on the Closing Date in connection with the Trust. The Sponsor shall
file any financing statements or amendments and continuation statements thereto
required by any change in the Uniform Commercial Code.
Section
3.24 Optional
Purchase of Defaulted Mortgage Loans; Optional Purchase of Certain Mortgage
Loans.
With
respect to any Mortgage Loan which is delinquent in payment by ninety-one (91)
days or more or is an REO Property, the Sponsor shall have the right to purchase
such Mortgage Loan or REO Property from the Trust at a price equal to the
Purchase Price. The Purchase Price shall be remitted to the related Servicer
for
deposit in the related Custodial Account and remitted by the related Servicer
to
the Securities Administrator on the Remittance Date in the month immediately
following the month in which the Purchase Price was deposited in the related
Custodial Account.
In
addition, the Sponsor may, at its option, purchase any Mortgage Loan from the
trust if the first Scheduled Payment due for such Mortgage Loan is on or
subsequent to the Cut-off Date and such first Scheduled Payment is not made
within thirty (30) days of the related Due Date.
If
at any
time the Sponsor remits to the related Servicer a payment for deposit in the
related Custodial Account covering the amount of the Purchase Price for such
a
Mortgage Loan and such Servicer delivers an Officer’s Certificate to the Trustee
certifying that the Purchase Price has been deposited in the related Custodial
Account, the Trustee shall execute the assignment of such Mortgage Loan at
the
request of the Sponsor without recourse to the Sponsor which shall succeed
to
all the Trustee’s, right, title and interest in and to such Mortgage Loan, and
all security and documents relative thereto. Such assignment shall be an
assignment outright and not for security. The Sponsor will thereupon own such
Mortgage, and all such security and documents, free of any further obligation
to
the Trustee or the Certificateholders with respect thereto. The Sponsor shall
be
responsible for any transfer costs incurred with respect to a Mortgage Loan
purchased pursuant to this Section 3.24.
If
the
Sponsor repurchases a Mortgage Loan pursuant to this Section 3.24, the related
Servicer shall continue to service such Mortgage Loan unless the Sponsor shall
repurchase the servicing rights thereon on terms mutually agreed to by the
Sponsor and the related Servicer. Notwithstanding the foregoing, the Master
Servicer shall have no obligation to master service any Mortgage Loan that
has
been so repurchased.
Section
3.25 [Reserved].
Section
3.26 Collection
of Mortgage Loan Payments; Custodial Accounts.
(a) Each
Servicer shall make reasonable efforts in accordance with Accepted Servicing
Practices to collect all payments called for under the terms and provisions
of
the related Mortgage Loans to the extent such procedures shall be consistent
with this Agreement and the terms and provisions of any related Required
Insurance Policy. Consistent with the foregoing, each Servicer may in its
discretion (i) waive any late payment charge and (ii) extend the due dates
for
payments due on a Mortgage Note for a Mortgage Loan serviced by it for a period
not greater than 180 days; provided, however no such extension shall be
materially adverse to the Certificateholders as reasonably determined by the
related Servicer. In the event of any such arrangement, the related Servicer
shall make Advances on the related Mortgage Loan during the scheduled period
in
accordance with the amortization schedule of such Mortgage Loan without
modification thereof by reason of such arrangements, and shall be entitled
to
reimbursement therefor in accordance with Section 5.01. No Servicer shall
be required to institute or join in litigation with respect to collection of
any
payment (whether under a Mortgage, Mortgage Note or otherwise or against any
public or governmental authority with respect to a taking or condemnation)
if it
reasonably believes that enforcing the provision of the Mortgage or other
instrument pursuant to which such payment is required is prohibited by
applicable law. In addition, if (x) a Mortgage Loan is in default or default
is
imminent or (y) the related Servicer delivers to the Trustee and the Securities
Administrator a REMIC Opinion, the related Servicer may, (A) amend the related
Mortgage Note to reduce the Mortgage Rate applicable thereto and (B) amend
any
Mortgage Note for a Mortgage Loan to extend the maturity thereof.
(b) Each
Servicer shall establish and maintain a segregated Custodial Account (which
shall at all times be an Eligible Account) with a depository institution in
the
name of the Servicer for the benefit of the Trustee on behalf of the
Certificateholders and designated “HSBC Bank USA, National Association, as
trustee for registered holders of Nomura Home Equity Loan, Inc., Asset-Backed
Certificates, Series 2007-2.” On behalf of the Trust Fund, each Servicer shall
deposit or cause to be deposited in the clearing account in which it customarily
deposits payments and collection on mortgage loans in connection with its
mortgage loan servicing activities on a daily basis and in no event more than
one Business Day after such Servicer’s receipt thereof, and shall thereafter
deposit in the related Custodial Account, in no event more than two Business
Days after such Servicer’s receipt thereof, except as otherwise specifically
provided herein, the following payments and collections remitted by subservicers
or received by it in respect of the Mortgage Loans subsequent to the Cut-off
Date (other than in respect of principal and interest due on the Mortgage Loans
on or before the Cut-off Date) and the following amounts required to be
deposited hereunder:
(i) all
payments on account of principal, including Principal Prepayments and Subsequent
Recoveries, on the Mortgage Loans;
(ii) all
payments on account of interest on the Mortgage Loans net of the Servicing
Fee
permitted under Section 3.10;
(iii) all
Liquidation Proceeds, Insurance Proceeds and condemnation proceeds with respect
to the Mortgage Loans, other than proceeds to be applied to the restoration
or
repair of the related Mortgaged Properties or released to the Mortgagor in
accordance with the Servicer’s normal servicing procedures;
(iv) any
amount required to be deposited by the related Servicer pursuant to
Section 3.26(c) in connection with any losses on Permitted
Investments;
(v) any
amounts required to be deposited by the related Servicer pursuant to
Section 3.05;
(vi) any
amounts required to be deposited by the related Servicer pursuant to
Section 5.02;
(vii) any
amounts paid by an Advance Financing Person in respect of Advances or Servicing
Advances;
(viii) any
Prepayment Charges collected by the related Servicer in connection with the
Principal Prepayment of any of the Mortgage Loans and any Servicer Prepayment
Charge Payment Amounts;
(ix) the
Purchase Price with respect to any Mortgage Loans serviced by the related
Servicer and purchased by the Sponsor pursuant to Section 2.02 or 2.03, any
amounts which are to be treated pursuant to Section 2.04 of this Agreement
as the payment of such a Purchase Price and the Purchase Price with respect
to
any Mortgage Loans serviced by the related Servicer and purchased by the Sponsor
pursuant to Section 3.24; and
(x) any
other
amounts required to be deposited hereunder.
The
foregoing requirements for deposit by the related Servicer into the related
Custodial Account shall be exclusive, it being understood and agreed that,
without limiting the generality of the foregoing, payments in the nature of
late
payment charges or assumption fees, if collected, and, with respect to Ocwen,
Equity One or SPS, any Prepayment Interest Excess need not be deposited by
the
related Servicer. In the event that a Servicer shall deposit any amount not
required to be deposited and not otherwise subject to withdrawal pursuant to
Section 3.27, it may at any time withdraw or direct the institution
maintaining the related Custodial Account, to withdraw such amount from the
related Custodial Account, any provision herein to the contrary notwithstanding.
Such withdrawal or direction may be accomplished by delivering written notice
thereof to the institution maintaining the related Custodial Account, that
describes the amounts deposited in error in such Custodial Account. Each
Servicer shall maintain adequate records with respect to all withdrawals from
its Custodial Account made pursuant to this Section. All funds deposited in
the
Custodial Accounts shall be held in trust for the Certificateholders until
withdrawn in accordance with Section 3.27.
(c) The
institution that maintains a Custodial Account, or other authorized entity
shall
invest the funds in such Custodial Account, in the manner directed by the
related Servicer, in Permitted Investments which shall mature not later than
the
next succeeding Remittance Date and shall not be sold or disposed of prior
to
its maturity. All such Permitted Investments shall be made in the name of the
Trustee, for the benefit of the Certificateholders. All income and gain net
of
any losses realized from any such investment shall be for the benefit of the
related Servicer as servicing compensation and shall be remitted to it monthly
as provided herein. The amount of any net losses (after application of all
income and gains) incurred in the related Servicer’s Custodial Account in
respect of any such investments shall be deposited by the related Servicer
into
such Custodial Account immediately as realized, out of its own
funds.
(d) Each
Servicer shall give at least thirty (30) days’ advance notice to the Trustee,
the Securities Administrator, the Master Servicer the Sponsor, each Rating
Agency and the Depositor of any proposed change of location of the related
Custodial Account prior to any change thereof.
Section
3.27 Permitted
Withdrawals From the Custodial Accounts.
(a) Each
Servicer may from time to time make withdrawals from the related Custodial
Account for the following purposes:
(i) to
pay
itself (to the extent not previously paid to or withheld by it), as servicing
compensation in accordance with Section 3.10, that portion of any payment
of interest that equals the Servicing Fee for the period with respect to which
such interest payment was made, and, as additional servicing compensation,
those
other amounts set forth in Section 3.10;
(ii) to
reimburse itself or an Advance Financing Person for (A) any unreimbursed
Advances to the extent of amounts received which represent late recoveries
of
payments of principal and/or interest (net of the related Servicing Fees),
Liquidation Proceeds and Insurance Proceeds on the related Mortgage Loans with
respect to which such Advances were made in accordance with the provisions
of
Section 5.01; and (B) any unreimbursed Advances with respect to the final
liquidation of a Mortgage Loan that are Nonrecoverable Advances, but only to
the
extent that late recoveries of payments of principal and/or interest,
Liquidation Proceeds and Insurance Proceeds received with respect to such
Mortgage Loan are insufficient to reimburse such Servicer or an Advance
Financing Person for such unreimbursed Advances or (C) subject to
Section 3.27(b), any unreimbursed Advances to the extent of Amounts Held
For Future Distribution funds held in the related Custodial Account relating
to
the Mortgage Loans that were not included in the Available Distribution Amount
for the preceding Distribution Date;
(iii) to
reimburse itself or an Advance Financing Person for any Nonrecoverable
Advances;
(iv) to
reimburse itself from Insurance Proceeds for Insured Expenses covered by the
related Insurance Policy;
(v) to
pay
itself any unpaid Servicing Fees, including any unpaid Servicing Fees to the
extent not recoverable from Liquidation Proceeds, Insurance Proceeds or other
amounts received with respect to any Liquidated Loan, and to reimburse itself
or
any Advance Financing Person for any unreimbursed Servicing Advances, provided,
however, that the related Servicer’s or such Advance Financing Person’s right to
reimbursement for Servicing Advances pursuant to this subclause (v) with respect
to any Mortgage Loan shall be limited to amounts received on particular Mortgage
Loan(s) (including, for this purpose, late recoveries of payments of principal
and/or interest, Liquidation Proceeds, Insurance Proceeds, condemnation proceeds
and purchase and repurchase proceeds) that represent late recoveries of the
payments for which such Servicing Advances were made;
(vi) to
pay to
the Sponsor or the Depositor with respect to each Mortgage Loan or property
acquired in respect thereof that has been purchased pursuant to
Section 2.02, 2.03 or 3.24, all amounts received thereon and not taken into
account in determining the related Stated Principal Balance of such repurchased
Mortgage Loan;
(vii) to
pay
any expenses reimbursable pursuant to Section 7.04;
(viii) to
withdraw any amount deposited in the related Custodial Account and not required
to be deposited therein;
(ix) to
transfer such funds to a different Custodial Account as permitted by Section
3.26;
(x) to
reimburse the related Servicer for any unreimbursed Advances and Servicing
Advances to the extent of funds held in its Collection Account for future
distribution that were not included in the Interest Remittance Amount and the
Principal Remittance Amount for the preceding Distribution Date (provided that
such amounts must be deposited into the related Collection Account prior to
the
next Remittance Date on which such amounts are to be included in the Interest
Remittance Amount and the Principal Remittance Amount for the related
Distribution Date; and
(xi) to
clear
and terminate the related Custodial Account upon termination of this Agreement
pursuant to Section 10.01 hereof.
In
addition, no later than 3:00 p.m. Eastern time on the Remittance Date, each
Servicer shall withdraw from the related Custodial Account and remit to the
Securities Administrator (a) all amounts deposited in such Custodial Account
as
of the close of business on the last day of the related Due Period (net of
charges against or withdrawals from such Custodial Account pursuant to this
Section 3.27(a)), plus (b) all Advances, if any, which such Servicer is
obligated to make pursuant to Section 5.01, minus (c) any amounts
attributable to Principal Prepayments, Liquidation Proceeds, Insurance Proceeds
or condemnation proceeds received after the applicable Prepayment Period, which
amounts shall be remitted on the following Remittance Date, together with any
Compensating Interest required to be deposited in the related Custodial Account
in connection with such Principal Prepayment in accordance with
Section 5.02, and minus (d) any amounts attributable to Scheduled Payments
collected but due on a Due Date or Due Dates subsequent to the first day of
the
month in which such Remittance Date occurs, which amounts shall be remitted
on
the Remittance Date next succeeding the Due Date related to such Scheduled
Payment.
With
respect to any remittance received by the Securities Administrator after the
Business Day on which such payment was due, the Securities Administrator shall
send written notice thereof to the related Servicer. The related Servicer shall
pay to the Securities Administrator interest on any such late payment by such
Servicer at an annual rate equal to Prime Rate (as defined in The Wall Street
Journal) plus one percentage point, but in no event greater than the maximum
amount permitted by applicable law. Such interest shall be paid by the related
Servicer to the Securities Administrator on the date such late payment is made
and shall cover the period commencing with the day following the Business Day
on
which such payment was due and ending with the Business Day on which such
payment is made, both inclusive. The payment by a Servicer of any such interest,
or the failure of the Securities Administrator to notify such Servicer of such
interest, shall not be deemed an extension of time for payment or a waiver
of
any Servicer Default by such Servicer.
Each
Servicer shall keep and maintain separate accounting, on a Mortgage Loan by
Mortgage Loan basis, for the purpose of justifying any withdrawal from the
related Custodial Account pursuant to subclauses (i), (ii), (iv), (v) and (vi)
above. Prior to making any withdrawal from the related Custodial Account
pursuant to subclause (iii), the related Servicer shall deliver to the Master
Servicer an Officer’s Certificate of an Authorized Servicer Representative
indicating the amount of any previous Advance or Servicing Advance determined
by
such Servicer to be a Nonrecoverable Advance and identifying the related
Mortgage Loan(s), and their respective portions of such Nonrecoverable
Advance.
(b) Notwithstanding
the foregoing, any Amounts Held For Future Distribution withdrawn by a Servicer
as permitted in Section 3.27(a)(ii) in reimbursement of Advances previously
made by such Servicer shall be appropriately reflected in such Servicer’s
records and replaced by such Servicer by deposit in the related Custodial
Account, no later than the close of business on the Remittance Date immediately
following the Due Period or Prepayment Period for which such amounts relate.
The
Securities Administrator will notify the related Servicer and the Master
Servicer by the close of business on the Business Day prior to the Distribution
Date in the event that the amount remitted by the related Servicer to the
Securities Administrator on such date is less than the Advances required to
be
made by the related Servicer for the related Distribution Date.
Section
3.28 Reports
to Master Servicer.
Not
later
than 3:00 p.m. Eastern time on the eighteenth (18th) calendar day of each month
(or if such eighteenth calendar day is not a Business Day, the immediately
following Business Day), each Servicer shall furnish to the Master Servicer
(i)
(a) monthly loan data in a mutually agreed-upon format, (b) default loan data
in
the format set forth in Exhibit X-1 hereto (or in such other format mutually
agreed-upon between the related Servicer and the Master Servicer) and (c)
information regarding realized losses and gains in the format set forth in
Exhibit X-2 hereto (or in such other format mutually agreed between the related
Servicer and the Master Servicer), in each case relating to the period ending
on
the last day of the preceding calendar month, (ii) all such information
reasonably required pursuant to clause (i)(a) above on a magnetic tape,
electronic mail, or other similar media reasonably acceptable to the Master
Servicer and (iii) all supporting documentation with respect to the information
required pursuant to clause (i)(c) above.
Section
3.29 Collection
of Taxes; Assessments and Similar Items; Escrow Accounts.
To
the
extent required by the Mortgage Note related to a Mortgage Loan, each Servicer
shall establish and maintain one or more accounts (each, an “Escrow Account”)
and deposit, promptly upon receipt, and retain therein all collections from
the
Mortgagors (or Servicing Advances made by the related Servicer) for the payment
of taxes, assessments, hazard insurance premiums or comparable items for the
account of the Mortgagors. Nothing herein shall require a Servicer to compel
a
Mortgagor to establish an Escrow Account in violation of applicable
law.
Withdrawals
of amounts so collected from the Escrow Accounts may be made only to effect
timely payment of taxes, assessments, hazard insurance premiums, condominium
or
PUD association dues, or comparable items, to reimburse the related Servicer
out
of related collections for any payments made with respect to each Mortgage
Loan
pursuant to Section 3.01 (with respect to taxes and assessments and
insurance premiums) and Section 3.05 (with respect to hazard insurance), to
refund to any Mortgagors any sums as may be determined to be overages, to pay
interest, if required by law or the terms of the related Mortgage or Mortgage
Note, to such Mortgagors on balances in the Escrow Account, to remove amounts
deposited in error or to clear and terminate the Escrow Account at the
termination of this Agreement in accordance with Section 10.01 thereof. The
Escrow Account shall not be a part of the Trust Fund.
Section
3.30 Adjustments
to Mortgage Rate and Scheduled Payment.
On
each
applicable Adjustment Date, the Mortgage Rate with respect to each adjustable
rate Mortgage Loan shall be adjusted, in compliance with the requirements of
the
related Mortgage and Mortgage Note, to equal the sum of the Index plus the
Gross
Margin (rounded in accordance with the related Mortgage Note) subject to the
applicable Periodic Rate Cap, Maximum Mortgage Interest Rate and Minimum
Mortgage Interest Rate, as set forth in the Mortgage Note. Each Servicer shall
execute and deliver the notices required by each Mortgage and Mortgage Note
related to a Mortgage Loan serviced by such Servicer, applicable laws and
regulations regarding interest rate adjustments. Each Servicer shall also
provide timely notification to the Master Servicer of all applicable data and
information regarding such interest rate adjustments and such Servicer’s methods
of implementing such interest rate adjustments. Upon the discovery by a Servicer
or the Master Servicer that a Servicer has failed to adjust a Mortgage Rate
or a
Scheduled Payment pursuant to the terms of the related Mortgage Note and
Mortgage, such Servicer shall immediately deposit in the related Custodial
Account from its own funds the amount of any interest loss caused thereby
without reimbursement therefor.
(a) In
addition, each month Ocwen shall provide to the Depositor, or the Depositor’s
designee, loan-level performance data of each Ocwen Mortgage Loan listed on
the
Mortgage Loan Schedule. For purposes of this subsection, loan level performance
data shall be limited to the following: (i) date (as of end of the month);
(ii)
loan identification number; (iii) current interest rate; (iv) actual beginning
principal balance; (v) actual ending principal balance; (vi) scheduled principal
and interest; (vii) scheduled principal; (viii) actual principal collected
account; (ix) actual gross interest collected amount; (x) next payment due
date;
(xi) loan modification flag (Y/N); (xii) in foreclosure (Y/N); (xiii) in REO
(Y/N); (xiv) bankruptcy type (7, 11, 13 or blank); (xv) post-petition due date
(for bankruptcy chapter 13 loans only); (xvi) paid-in-full date; (xvii)
paid-in-full principal; (xviii) prepay penalty collected amount; (xix)
foreclosure completed date; (xx) liquidation date; (xxi) liquidation type (REO
sale, short sale, third party sale, write off, other); (xxii) loss amount before
any mortgage insurance claim; (xxiii) mortgage insurance company name; (xxiv)
mortgage insurance claim received amount.
Section
3.31 Distribution
Account.
(a) The
Securities Administrator shall establish and maintain in the name of the
Trustee, for the benefit of the Certificateholders, the Distribution Account
as
a segregated non-interest bearing trust account or accounts. The Securities
Administrator will deposit in the Distribution Account as identified by the
Securities Administrator and as received by the Securities Administrator, the
following amounts:
(i) All
payments and recoveries in respect of principal on the Mortgage Loans,
including, without limitation, Principal Prepayments, Subsequent Recoveries,
Liquidation Proceeds, Insurance Proceeds, condemnation proceeds and all payments
and recoveries in respect of interest on the Mortgage Loans withdrawn by the
Servicers from the Custodial Account and remitted by the Servicers to the
Securities Administrator;
(ii) Any
Advance and any Compensating Interest Payments;
(iii) Any
Prepayment Charges collected by the Servicer in connection with the Principal
Prepayment of any of the Mortgage Loans (including any Servicer Prepayment
Charge Payment Amounts);
(iv) Any
Insurance Proceeds or Liquidation Proceeds received by or on behalf of the
Securities Administrator or which were not deposited in a Custodial
Account;
(v) The
Purchase Price with respect to any Mortgage Loans purchased by the Sponsor
or
Section 2.02 or 2.03, any amounts which are to be treated pursuant to
Section 2.04 of this Agreement as the payment of such a Purchase Price, the
Purchase Price with respect to any Mortgage Loans purchased by the Sponsor
pursuant to Section 3.24, and all proceeds of any Mortgage Loans or
property acquired with respect thereto repurchased by the Master Servicer
pursuant to Section 10.01;
(vi) Any
amounts required to be deposited with respect to losses on investments of
deposits in an Account; and
(vii) Any
other
amounts received by or on behalf of the Securities Administrator and required
to
be deposited in the Distribution Account pursuant to this
Agreement.
(b) All
amounts deposited to the Distribution Account shall be held by the Securities
Administrator in the name of the Trustee in trust for the benefit of the
Certificateholders in accordance with the terms and provisions of this
Agreement. The requirements for crediting the Distribution Account shall be
exclusive, it being understood and agreed that, without limiting the generality
of the foregoing, payments in the nature of late payment charges or assumption,
tax service, statement account or payoff, substitution, satisfaction, release
and other like fees and charges, need not be credited by the Securities
Administrator to the Distribution Account.
(c) The
amount at any time credited to the Distribution Account may be invested by
the
Securities Administrator in Permitted Investments that mature no later than
the
Business Day prior to the next succeeding Distribution Date as directed by
the
Master Servicer, unless the investment is managed by the Securities
Administrator or an affiliate of the Securities Administrator, in which case
such Permitted Investments may mature on the Distribution Date. All such
investment income shall be for the benefit of the Master Servicer, and any
losses incurred shall be deposited by the Master Servicer in the Distribution
Account immediately as realized.
Section
3.32 Permitted
Withdrawals and Transfers from the Distribution Account.
(a) The
Securities Administrator will from time to time make or cause to be made such
withdrawals or transfers from the Distribution Account pursuant to this
Agreement for the following purposes:
(i) to
pay to
the Trustee any expenses recoverable by the Trustee pursuant to this
Agreement.
(ii) to
reimburse the Master Servicer as Successor Servicer or a Servicer for any
Advance or Servicing Advance of its own funds, the right of the Master Servicer
as Successor Servicer or a Servicer to reimbursement pursuant to this subclause
(ii) being limited to amounts received on a particular Mortgage Loan (including,
for this purpose, the Purchase Price therefor, Insurance Proceeds, Liquidation
Proceeds and condemnation proceeds) which represent late payments or recoveries
of the principal of or interest on such Mortgage Loan respecting which such
Advance or Servicing Advance was made;
(iii) to
reimburse the Master Servicer or a Servicer from Insurance Proceeds or
Liquidation Proceeds relating to a particular Mortgage Loan for amounts expended
by the Master Servicer as Successor Servicer or such Servicer in good faith
in
connection with the restoration of the related Mortgaged Property which was
damaged by an uninsured cause or in connection with the liquidation of such
Mortgage Loan;
(iv) to
reimburse the Master Servicer as Successor Servicer or a Servicer from Insurance
Proceeds relating to a particular Mortgage Loan for insured expenses incurred
with respect to such Mortgage Loan and to reimburse the Master Servicer as
Successor Servicer or such Servicer from Liquidation Proceeds from a particular
Mortgage Loan for Liquidation Expenses incurred with respect to such Mortgage
Loan;
(v) to
reimburse the Master Servicer as Successor Servicer or such Servicer for
advances of funds pursuant to this Agreement, and the right to reimbursement
pursuant to this subclause being limited to amounts received on the related
Mortgage Loan (including, for this purpose, the Purchase Price therefor,
Insurance Proceeds, Liquidation Proceeds and condemnation proceeds) which
represent late recoveries of the payments for which such advances were
made;
(vi) to
reimburse the Master Servicer as Successor Servicer or such Servicer for any
Advance or advance, after a Realized Loss has been allocated with respect to
the
related Mortgage Loan if the Advance or advance has not been reimbursed pursuant
to clauses (ii) and (v);
(vii) [reserved];
(viii) to
reimburse the Trustee or the Securities Administrator for expenses, costs and
liabilities incurred by and reimbursable to it pursuant to this Agreement
(including the expenses of the Securities Administrator in connection with
a tax
audit in connection with the performance of its obligations pursuant to
Section 9.13);
(ix) to
pay to
the Trust Fund, as additional servicing compensation, any Excess Liquidation
Proceeds to the extent not retained by a Servicer;
(x) to
reimburse or pay a Servicer any such amounts as are due thereto under this
Agreement and have not been retained by or paid to such Servicer, to the extent
provided herein or therein;
(xi) to
reimburse the Trustee for expenses incurred in the transfer of servicing
responsibilities of a terminated Servicer after the occurrence and continuance
of a Servicer Default to the extent not paid by the terminated
Servicer;
(xii) to
reimburse the Master Servicer for any costs and expenses reimbursable to the
Master Servicer pursuant to this Agreement;
(xiii) to
reimburse the Custodian for expenses, costs and liabilities incurred or
reimbursable to it pursuant to this Agreement or the Custodial
Agreement;
(xiv) to
remove
amounts deposited in error; and
(xv) to
clear
and terminate the Distribution Account pursuant to
Section 10.01.
(b) The
Securities Administrator shall keep and maintain separate accounting, on a
Mortgage Loan by Mortgage Loan basis, for the purpose of accounting for any
reimbursement from the Distribution Account pursuant to subclauses (ii) through
(v), inclusive, and (vii) or with respect to any such amounts which would have
been covered by such subclauses had the amounts not been retained by the
Securities Administrator without being deposited in the Distribution Account
under Section 3.31.
(c) On
each
Distribution Date, the Securities Administrator shall distribute the Available
Distribution Amount, to the extent of funds on deposit in the Distribution
Account to the holders of the Certificates in accordance with
Section 5.04.
Section
3.33 Credit
Risk Management Services and Reports; Reliability of Data.
(a) The
Depositor hereby appoints Xxxxx Fargo Bank, National Association as Credit
Risk
Manager. The Credit Risk Manager shall perform certain services related to
servicer review and oversight, monitoring and reporting of various Mortgage
Loans and the Servicer’s performance, preparation of Mortgage Loan and REO
Property payment, delinquency and loss information, reconciliation of Prepayment
Charge collections by the Servicers and monitoring information related to
insurance claims and foreclosures. If the Credit Risk Manager is not also acting
as the Master Servicer, each Servicer shall furnish to the Credit Risk Manager
a
copy of all reports required to be provided by the Servicers to the Master
Servicer pursuant to Section 3.28, which reports shall be provided in electronic
format. No later than the end of each calendar month, the Credit Risk Manager
shall prepare and make available certain reports containing various performance,
payment, delinquency and loss information and information related to insurance
claims and foreclosures. Such reports shall be made available through the
facilities of Xxxxx Fargo’s corporate trust services website, currently located
at xxx.XXXXxxx.xxx,
and
shall be in a format and contain such content as is mutually agreed upon by
the
Sponsor and the Credit Risk Manager. None of the Trustee, the Securities
Administrator, the Servicer or the Master Servicer shall have any obligation
to
review such reports or otherwise monitor or supervise the activities of the
Credit Risk Manager.
(b) The
Transaction Parties acknowledge and agree that the reports that are compiled
and
prepared by the Credit Risk Manager are based on information provided to the
Credit Risk Manager by the Servicer, the Master Servicer and from various
unaffiliated third parties, including other Persons involved in the servicing
and administration of the related Mortgage Loans or related REO Properties.
The
Credit Risk Manager makes no representation or warranty as to the accuracy
or
completeness of any such information or data, and the Credit Risk Manager shall
not be responsible for any misstatements, omissions, errors, or inaccuracies
in
any such reports or information resulting from any misstatements, omissions,
errors, or inaccuracies in any information or data provided by third
parties.
Section
3.34 Intellectual
Property and Confidentiality.
The
Transaction Parties acknowledge and agree that the Credit Risk Manager’s
services hereunder involve the use of various data, information, templates,
processes, ideas, inventions, technology, software, algorithms, mathematical
models, analytical tools, evaluative processes, parameters, measurements,
methods, know-how, techniques, business practices, functionalities, ideas and
concepts developed or utilized by the Credit Risk Manager or its affiliates
in
connection with the Credit Risk Manager’s performance of the credit risk
management services and various other services (collectively, “Xxxxx
Fargo Intellectual Property”),
and
that all such Xxxxx Fargo Intellectual Property is the sole and exclusive
property of the Credit Risk Manager and its Affiliates and that no license
for
use of such Xxxxx Fargo Intellectual Property is granted hereby or can be
implied by the terms of this Agreement or the activities of the parties
hereunder. The Transaction Parties covenant and agree to preserve the
confidentiality of such Xxxxx Fargo Intellectual Property, and further covenant
and agree that neither the Transaction Parties nor any of their affiliates,
directors, officers, employees, agents or representatives, including their
outside counsel, auditors and advisors, respectively, shall use (or otherwise
appropriate in any respect) any such Xxxxx Fargo Intellectual Property or
disclose, publicize, transfer, or otherwise compromise the value of any such
Xxxxx Fargo Intellectual Property, unless such Transaction Party is required
by
law or court order to disclose all or any part of the Xxxxx Fargo Intellectual
Property or except to another Transaction Party.
Section
3.35 Limitation
Upon Liability of Credit Risk Manager; Indemnification.
Neither
the Credit Risk Manager nor any of the directors, officers, employees, or agents
of the Credit Risk Manager shall be under any liability to the Servicer, the
Master Servicer, the Securities Administrator, the Trustee, the
Certificateholders or the Depositor for any action taken or for refraining
from
the taking of any action in good faith pursuant to this Agreement in reliance
upon information provided by the Servicers, the Master Servicer or any
Transaction Party or of errors in judgment; provided, however, that this
provision shall not protect the Credit Risk Manager or any such person against
any breach of representations or warranties made herein, failure to perform
its
obligations hereunder, or any liability which would otherwise be imposed by
reason of willful misfeasance, bad faith, or gross negligence of the Credit
Risk
Manager in the performance of its duties hereunder or by reason of a breach
of
its obligations and duties under this Agreement. The Credit Risk Manager and
any
officer, employee or agent of the Credit Risk Manager may rely in good faith
on
any document of any kind prima facie properly executed and submitted by any
Person respecting any matters arising hereunder. Subject to the terms of this
Agreement, the Credit Risk Manager shall be under no obligation to appear in,
prosecute, or defend any legal action which, in its reasonable opinion, may
involve it in any expense or liability; provided, however, that the Credit
Risk
Manager may with the consent of the applicable Transaction Party, and at such
Transaction Party’s expense, undertake any such action that it may deem
necessary or desirable in respect to this Agreement and the rights, duties,
and
the interests of the parties hereto.
The
Credit Risk Manager shall be indemnified by the Trust Fund and held harmless
thereby against any loss, liability or expense (including reasonable legal
fees
and disbursements of counsel) incurred on its part that may be sustained in
connection with, arising out of, or relating to this Agreement or any action
taken or not taken by it under this Agreement unless such claims, liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements were imposed on, incurred by or asserted against
the
Credit Risk Manager or such other Person solely as a result of (i) the breach
by
the Credit Risk Manager of its obligations hereunder, which breach would subject
the Credit Risk Manager to liability pursuant to the first paragraph of this
Section or (ii) the breach by a Transaction Party of its obligations under
this
Agreement, in which case the related Transaction Party (with the exception
of
the Trustee) shall indemnify the Credit Risk Manager. Notwithstanding the
foregoing, neither the Trust Fund nor the Transaction Parties shall indemnify
the Credit Risk Manager for ordinary costs and expenses otherwise incurred
by
the Credit Risk Manager in the performance of the Credit Risk Manager’s duties
under this Agreement. The foregoing indemnification shall survive the
termination of this agreement or the termination, removal or substitution of
any
party to this Agreement.
Section
3.36 Resignation
or Removal of Credit Risk Manager.
The
Credit Risk Manager may resign upon thirty (30) days’ prior written notice to
the Trustee. The Credit Risk Manager may be removed as Credit Risk Manager
hereunder upon any material breach by the Credit Risk Manager in the performance
of its duties hereunder following written notice of such breach provided by
the
Trustee at the direction of Certificateholders holding not less than a 66-2/3%
of the Voting Rights and the Credit Risk Manager’s failure to cure such breach
within a reasonable period following such notice.
ARTICLE
IV
ADMINISTRATION
AND MASTER SERVICING OF THE MORTGAGE LOANS
Section
4.01 The
Master Servicer.
The
Master Servicer shall supervise, monitor and oversee the obligation of each
Servicer to
service and administer the related Mortgage Loans in accordance with the terms
of this Agreement or the Servicing Agreement, as applicable, and shall have
full
power and authority to do any and all things which it may deem necessary or
desirable in connection with such master servicing and administration. In
performing its obligations hereunder, the Master Servicer shall act in a manner
consistent with Accepted Master Servicing Practices. Furthermore, the Master
Servicer shall oversee and consult with each Servicer as necessary from
time-to-time to carry out the Master Servicer’s obligations hereunder, shall
receive, review and evaluate all reports, information and other data provided
to
the Master Servicer by a Servicer and shall enforce each Servicer’s obligation
to perform and observe the covenants, obligations and conditions to be performed
or observed by such Servicer under this Agreement or the Servicing Agreement,
as
applicable. The Master Servicer shall independently and separately monitor
each
Servicer’s servicing activities with respect to each Mortgage Loan serviced by
such Servicer, reconcile the results of such monitoring with such information
provided in the previous sentence on a monthly basis and coordinate corrective
adjustments to the related Servicer’s and Master Servicer’s records, and based
on such reconciled and corrected information, provide such information relating
to the Mortgage Loans to the Securities Administrator as shall be necessary
to
enable it to prepare the statements specified in Section 5.06 and any other
information and statements required to be provided by the Securities
Administrator hereunder. The Master Servicer shall reconcile the results of
its
Mortgage Loan monitoring with the actual remittances of the Servicers to the
Distribution Account.
Notwithstanding
anything in this Agreement to the contrary, the Master Servicer shall not have
any duty or obligation to enforce any Credit Risk Management Agreement that
a
Servicer is a party to (the “Servicer Credit Risk Management Agreement”) or to
supervise, monitor or oversee the activities of the Credit Risk Manager under
a
Servicer Credit Risk Management Agreement with respect to any action taken
or
not taken by a Servicer pursuant to a recommendation of the Credit Risk
Manager.
The
Trustee shall furnish the Servicers and the Master Servicer with any limited
powers of attorney and other documents in form agreeable to the Trustee
necessary or appropriate to enable the Servicers and the Master Servicer to
service or master service and administer the Mortgage Loans and REO Property.
The Trustee shall have no responsibility for any action of the Master Servicer
or a Servicer pursuant to any such limited power of attorney or any other
executed document delivered by the Trustee pursuant to this paragraph and shall
be indemnified by the Master Servicer and the related Servicer for any cost,
liability or expense arising from the misuse thereof by the Master Servicer
or
the related Servicer.
The
Trustee, the Custodian and the Securities Administrator shall provide access
to
the records and documentation in possession of the Trustee, the Custodian or
the
Securities Administrator regarding the Mortgage Loans and REO Property and
the
servicing thereof to the Certificateholders, the FDIC, and the supervisory
agents and examiners of the FDIC, such access being afforded only upon
reasonable prior written request and during normal business hours at the office
of the Trustee, the Custodian or the Securities Administrator; provided,
however, that, unless otherwise required by law, none of the Trustee, the
Custodian or the Securities Administrator shall be required to provide access
to
such records and documentation if the provision thereof would violate the legal
right to privacy of any Mortgagor. The Trustee, the Custodian and the Securities
Administrator shall allow representatives of the above entities to photocopy
any
of the records and documentation and shall provide equipment for that purpose
at
a charge that covers the Trustee’s, the Custodian’s or the Securities
Administrator’s actual costs.
The
Trustee shall execute and deliver to the related Servicer or the Master Servicer
upon request any court pleadings, requests for trustee’s sale or other documents
necessary or desirable and, in each case, provided to the Trustee by the related
Servicer or the Master Servicer to (i) the foreclosure or trustee’s sale with
respect to a Mortgaged Property; (ii) any legal action brought to obtain
judgment against any Mortgagor on the Mortgage Note or any other Loan Document;
(iii) obtain a deficiency judgment against the Mortgagor; or (iv) enforce any
other rights or remedies provided by the Mortgage Note or any other Mortgage
Loan Document or otherwise available at law or equity.
Section
4.02 Monitoring
of the Servicers.
The
Master Servicer shall be responsible for monitoring the compliance by each
Servicer with its duties under this Agreement or the Servicing Agreement, as
applicable. In the review of a Servicer’s activities, the Master Servicer may
rely upon an officer’s certificate of such Servicer with regard to its
compliance with the terms of this Agreement or the Servicing Agreement, as
applicable. In the event that the Master Servicer, in its judgment, determines
that a Servicer should be terminated in accordance with this Agreement or the
Servicing Agreement, as applicable, or that a notice should be sent pursuant
to
this Agreement with respect to the occurrence of an event that, unless cured,
would constitute grounds for such termination, the Master Servicer shall notify
the Sponsor and the Trustee thereof and the Master Servicer shall issue such
notice or take such other action as it deems appropriate.
The
Master Servicer, for the benefit of the Trustee and the Certificateholders,
shall enforce the obligations of the Servicers under this Agreement and, if
applicable, the Servicing Agreement, and the Master Servicer (or, if Xxxxx
Fargo
is the defaulting Servicer, the Trustee) shall, in the event that a Servicer
fails to perform its obligations in accordance with this Agreement or the
Servicing Agreement, as applicable, subject to this Section, Article VIII
and the Servicing Agreement, terminate the rights and obligations of such
Servicer hereunder or under the Servicing Agreement, as applicable in accordance
with the provisions of Article VIII or the Servicing Agreement, as applicable.
The Master Servicer (or, if Xxxxx Fargo is the defaulting Servicer, the Trustee)
shall act as servicer of the Mortgage Loans or enter in to a new servicing
agreement with a successor servicer selected by the Master Servicer (or, if
Xxxxx Fargo is the defaulting Servicer, the Trustee); provided, however, it
is
understood and acknowledged by the parties hereto that there will be a period
of
transition (not to exceed 90 days) before the actual servicing functions can
be
fully transferred to the Master Servicer, the Trustee or such Successor
Servicer. Such enforcement, including, without limitation, the legal prosecution
of claims and the pursuit of other appropriate remedies, shall be in such form
and carried out to such an extent and at such time as the Master Servicer or
the
Trustee, as applicable, in its good faith business judgment, would require
were
it the owner of the Mortgage Loans. The Master Servicer or the Trustee, as
applicable, shall pay the costs of such enforcement, provided that no provision
of this Agreement shall require the Master Servicer or the Trustee to expend
or
risk their own funds or otherwise incur any financial liability in the
performance of any of their duties hereunder, or in the exercise of any of
their
rights or powers, if they shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability
is
not reasonably assured to them.
To
the
extent that the costs and expenses related to the termination of a Servicer,
appointment of a Successor Servicer or the transfer and assumption of servicing
by the Master Servicer or the Trustee if Xxxxx Fargo is the defaulting Servicer
(including, without limitation, (i) all legal costs and expenses and all due
diligence costs and expenses associated with an evaluation of the potential
termination of defaulting Servicer as a result of a Servicer Default and (ii)
all costs and expenses associated with the complete transfer of servicing,
including all servicing files and all servicing data and the completion,
correction or manipulation of such servicing data as may be required by the
Successor Servicer to correct any errors or insufficiencies in the servicing
data or otherwise to enable the Successor Servicer to service the related
Mortgage Loans in accordance with this Agreement or the Servicing Agreement,
as
applicable) are not fully and timely reimbursed by the terminated Servicer,
the
Master Servicer or the Trustee, as applicable shall be entitled to reimbursement
of such costs and expenses from the Distribution Account.
The
Master Servicer shall require each Servicer to comply with the remittance
requirements and other obligations set forth in this Agreement or the Servicing
Agreement, as applicable.
If
the
Master Servicer acts as Successor Servicer, it shall not assume liability for
the representations and warranties of a Servicer that it replaces.
Section
4.03 Fidelity
Bond.
The
Master Servicer, at its expense, shall maintain in effect a blanket fidelity
bond and an errors and omissions insurance policy that shall be in such form
and
amount generally acceptable for entities serving as master servicers or
trustees, affording coverage with respect to all directors, officers, employees
and other Persons acting on such Master Servicer’s behalf, and covering errors
and omissions in the performance of the Master Servicer’s obligations hereunder.
Any such errors and omissions policy and fidelity bond may not be cancelable
without thirty (30) days’ prior written notice to the Trustee.
Section
4.04 Power
to Act; Procedures.
The
Master Servicer shall master service the Mortgage Loans and shall have full
power and authority, subject to the REMIC Provisions and the provisions of
Section 9.13 hereof, to do any and all things that it may deem necessary or
desirable in connection with the master servicing and administration of the
Mortgage Loans, including but not limited to the power and authority (i) to
execute and deliver, on behalf of the Certificateholders and the Trustee,
customary consents or waivers and other instruments and documents, (ii) to
consent to transfers of any Mortgaged Property and assumptions of the Mortgage
Notes and related Mortgages, (iii) to collect any Insurance Proceeds and
Liquidation Proceeds, and (iv) to effectuate foreclosure or other conversion
of
the ownership of the Mortgaged Property securing any Loan, in each case, in
accordance with the provisions of this Agreement; provided, however, that the
Master Servicer shall not (and, consistent with its responsibilities under
Section 4.02, shall not permit any Servicer to) knowingly or intentionally
take any action, or fail to take (or fail to cause to be taken) any action
reasonably within its control and the scope of duties more specifically set
forth herein, that, under the REMIC Provisions, if taken or not taken, as the
case may be, would cause any REMIC to fail to qualify as a REMIC or result
in
the imposition of a tax upon the Trust Fund (including but not limited to the
tax on prohibited transactions as defined in Section 860F(a)(2) of the Code
and the tax on contributions to a REMIC set forth in Section 860G(d) of the
Code) unless the Master Servicer has received an Opinion of Counsel (but not
at
the expense of the Master Servicer) to the effect that the contemplated action
will not cause any REMIC to fail to qualify as a REMIC or result in the
imposition of a tax upon any REMIC. The Trustee shall furnish the Master
Servicer, upon written request from a Servicing Officer of the Master Servicer,
with any powers of attorney, in form agreeable to the Trustee, empowering the
Master Servicer, or the related Servicer to execute and deliver instruments
of
satisfaction or cancellation, or of partial or full release or discharge, and
to
foreclose upon or otherwise liquidate Mortgaged Property, and to appeal,
prosecute or defend in any court action relating to the Mortgage Loans or the
Mortgaged Property, in accordance with this Agreement, and the Trustee shall
execute and deliver such other documents, as the Master Servicer or a Servicer
may request, to enable the Master Servicer to master service and administer
the
Mortgage Loans and carry out its duties hereunder, in each case in accordance
with Accepted Master Servicing Practices (and the Trustee shall have no
liability for the misuse of any such powers of attorney by the Master Servicer
or the Servicer and shall be indemnified by the Master Servicer and the related
Servicer, as applicable, for any costs, liabilities or expenses incurred by
the
Trustee in connection with such misuse). If the Master Servicer or the Trustee
has been advised that it is likely that the laws of the state in which action is
to be taken prohibit such action if taken in the name of the Trustee or that
the
Trustee would be adversely affected under the “doing business” or tax laws of
such state if such action is taken in its name, the Master Servicer shall join
with the Trustee in the appointment of a co-trustee pursuant to
Section 9.10 hereof. In the performance of its duties hereunder, the Master
Servicer shall be an independent contractor and shall not, except in those
instances where it is taking action authorized pursuant to this Agreement to
be
taken by it in the name of the Trustee, be deemed to be the agent of the
Trustee.
Section
4.05 Due-on-Sale
Clauses; Assumption Agreements.
To
the
extent Mortgage Loans contain enforceable due-on-sale clauses, the Master
Servicer shall enforce the related Servicer’s obligation to enforce such clauses
in accordance with this Agreement or the Servicing Agreement, as applicable.
If
applicable law prohibits the enforcement of a due-on-sale clause or such clause
is otherwise not enforced in accordance with this Agreement or the Servicing
Agreement, as applicable, and, as a consequence, a Mortgage Loan is assumed,
the
original Mortgagor may be released from liability in accordance with this
Agreement.
Section
4.06 Documents,
Records and Funds in Possession of Master Servicer To Be Held for
Trustee.
The
Master Servicer shall transmit to the Trustee or Custodian such documents and
instruments coming into the possession of the Master Servicer from time to
time
as are required by the terms hereof to be delivered to the Trustee or the
Custodian. Any funds received by the Master Servicer in respect of any Mortgage
Loan or which otherwise are collected by the Master Servicer as Liquidation
Proceeds, Insurance Proceeds or Subsequent Recoveries in respect of any Mortgage
Loan shall be held for the benefit of the Trustee and the Certificateholders
subject to the Master Servicer’s right to retain or withdraw from the
Distribution Account the Master Servicing Compensation and other amounts
provided in this Agreement. The Master Servicer shall, to the extent required
by
Article III of this Agreement or the Servicing Agreement, as applicable, enforce
each Servicer’s obligation to provide access to information and documentation
regarding the Mortgage Loans serviced by such Servicer to the Trustee, its
agents and accountants at any time upon reasonable request and during normal
business hours, and to Certificateholders that are savings and loan
associations, banks or insurance companies, the OTS, the FDIC and the
supervisory agents and examiners of such Office and Corporation or examiners
of
any other federal or state banking or insurance regulatory authority if so
required by applicable regulations of the OTS or other regulatory authority,
such access to be afforded without charge but only upon reasonable request
in
writing and during normal business hours at the offices of the Master Servicer
designated by it. In fulfilling such a request the Master Servicer shall not
be
responsible for determining the sufficiency of such information.
All
Mortgage Files and funds collected or held by, or under the control of, the
Master Servicer, in respect of any Mortgage Loans, whether from the collection
of principal and interest payments or from Liquidation Proceeds or Insurance
Proceeds, shall be held by the Master Servicer for and on behalf of the Trustee
and the Certificateholders and shall be and remain the sole and exclusive
property of the Trustee; provided, however, that the Master Servicer and the
Servicer shall be entitled to setoff against, and deduct from, any such funds
any amounts that are properly due and payable to the Master Servicer or the
Servicer under this Agreement.
Section
4.07 Standard
Hazard Insurance and Flood Insurance Policies.
For
each
Mortgage Loan, the Master Servicer shall enforce any obligation of the related
Servicer under this Agreement or the Servicing Agreement, as applicable, to
maintain or cause to be maintained standard fire and casualty insurance and,
where applicable, flood insurance, all in accordance with the provisions of
this
Agreement or the related Servicing Agreement, as applicable. It is understood
and agreed that such insurance shall be with insurers meeting the eligibility
requirements set forth in this Agreement or the Servicing Agreement, as
applicable, and that no earthquake or other additional insurance is to be
required of any Mortgagor or to be maintained on property acquired in respect
of
a defaulted loan, other than pursuant to such applicable laws and regulations
as
shall at any time be in force and as shall require such additional
insurance.
Pursuant
to Section 3.31, any amounts collected by the Master Servicer, under any
insurance policies (other than amounts to be applied to the restoration or
repair of the property subject to the related Mortgage or released to the
Mortgagor in accordance with this Agreement or the Servicing Agreement, as
applicable) shall be deposited into the Distribution Account, subject to
withdrawal pursuant to Section 3.32.
Section
4.08 Presentment
of Claims and Collection of Proceeds.
The
Master Servicer shall enforce each Servicer’s obligation to, prepare and present
on behalf of the Trustee and the Certificateholders all claims under any
insurance policies and take such actions (including the negotiation, settlement,
compromise or enforcement of the insured’s claim) as shall be necessary to
realize recovery under such policies. Any proceeds disbursed to the Master
Servicer (or disbursed to the related Servicer and remitted to the Master
Servicer) in respect of such policies, bonds or contracts shall be promptly
deposited in the Distribution Account upon receipt, except that any amounts
realized that are to be applied to the repair or restoration of the related
Mortgaged Property as a condition precedent to the presentation of claims on
the
related Mortgage Loan to the insurer under any applicable insurance policy
need
not be so deposited (or remitted).
Section
4.09 Maintenance
of the Primary Mortgage Insurance Policies.
The
Master Servicer shall not take, or (to the extent within its control) permit
a
Servicer (to the extent such action is prohibited under this Agreement or the
Servicing Agreement, as applicable) to take, any action that would result in
noncoverage under any primary mortgage insurance policy or any loss which,
but
for the actions of the Master Servicer or such Servicer, would have been covered
thereunder. The Master Servicer shall use its best reasonable efforts to enforce
each Servicer’s obligation to keep in force and effect (to the extent that the
related Mortgage Loan requires the Mortgagor to maintain such insurance),
primary mortgage insurance applicable to each Mortgage Loan in accordance with
the provisions of this Agreement or the Servicing Agreement, as applicable.
The
Master Servicer shall not, and (to the extent within its control) shall not
permit a Servicer to, cancel or refuse to renew any primary mortgage insurance
policy that is in effect at the date of the initial issuance of the Mortgage
Note and is required to be kept in force hereunder except in accordance with
the
provisions of this Agreement or the Servicing Agreement, as
applicable.
The
Master Servicer agrees to enforce each Servicer’s obligation to present, on
behalf of the Trustee and the Certificateholders, claims to the insurer under
any primary mortgage insurance policies and, in this regard, to take such
reasonable action as shall be necessary to permit recovery under any primary
mortgage insurance policies respecting defaulted Mortgage Loans. Pursuant to
Section 3.31 of this Agreement or pursuant to the Servicing Agreement, as
applicable, any amounts collected by the Master Servicer or the related Servicer
under any primary mortgage insurance policies shall be deposited by the related
Servicer or by the Master Servicer in the Distribution Account, subject to
withdrawal pursuant to Section 3.32.
Section
4.10 Trustee
to Retain Possession of Certain Insurance Policies and Documents.
The
Trustee or the Custodian, shall retain possession and custody of the originals
(to the extent available) of any primary mortgage insurance policies, or
certificate of insurance if applicable, and any certificates of renewal as
to
the foregoing as may be issued from time to time as contemplated by this
Agreement. Until all amounts distributable in respect of the Certificates have
been distributed in full and the Master Servicer and the Servicers otherwise
have fulfilled their respective obligations under this Agreement or the
Servicing Agreement, as applicable, the Trustee or the Custodian shall also
retain possession and custody of each Mortgage File in accordance with and
subject to the terms and conditions of this Agreement and the Custodial
Agreement. The Master Servicer shall promptly deliver or cause to be delivered
to the Trustee or the Custodian, upon the execution or receipt thereof the
originals of any primary mortgage insurance policies, any certificates of
renewal, and such other documents or instruments that constitute Mortgage Loan
Documents that come into the possession of the Master Servicer from time to
time.
Section
4.11 Realization
Upon Defaulted Loans.
The
Master Servicer shall enforce each Servicer’s obligation to foreclose upon,
repossess or otherwise comparably convert the ownership of Mortgaged Properties
securing such of the Mortgage Loans as come into and continue in default and
as
to which no satisfactory arrangements can be made for collection of delinquent
payments, all in accordance with this Agreement or the Servicing Agreement,
as
applicable.
Section
4.12 Compensation
for the Master Servicer.
As
compensation for its services hereunder, the Master Servicer shall be entitled
to receive the Master Servicing Fee and to retain all income and gain realized
from any investment of funds in the Distribution Account. The Master Servicer
shall be required to pay all expenses incurred by it in connection with its
activities hereunder and shall not be entitled to reimbursement therefor except
as provided in this Agreement.
The
amount of the Master Servicing Compensation payable to the Master Servicer
in
respect of any Distribution Date shall be reduced in accordance with
Section 4.14.
Section
4.13 REO
Property.
In
the
event the Trust Fund acquires ownership of any REO Property in respect of any
Mortgage Loan, the deed or certificate of sale shall be issued to the Trustee,
or to its nominee, on behalf of the Certificateholders. The Master Servicer
shall enforce each Servicer’s obligation to sell, and each such Servicer agrees
to sell, any REO Property as expeditiously as possible and in accordance with
the provisions of this Agreement or the Servicing Agreement, as applicable.
Further, the Master Servicer shall enforce each Servicer’s obligation to sell
any REO Property prior to three (3) years after the end of the calendar year
of
its acquisition by REMIC I, unless (i) the Trustee and the Securities
Administrator shall have been supplied with an Opinion of Counsel to the effect
that the holding by the Trust Fund of such REO Property subsequent to such
three-year period will not result in the imposition of taxes on “prohibited
transactions” of any REMIC hereunder as defined in Section 860F of the Code
or cause any REMIC hereunder to fail to qualify as a REMIC at any time that
any
Certificates are outstanding, in which case the Trust Fund may continue to
hold
such Mortgaged Property (subject to any conditions contained in such Opinion
of
Counsel) or (ii) the related Servicer shall have applied for, prior to the
expiration of such three-year period, an extension of such three-year period
in
the manner contemplated by Section 856(e)(3) of the Code, in which case the
three-year period shall be extended by the applicable extension period. The
Master Servicer shall enforce each Servicer’s obligation to protect and
conserve, such REO Property in the manner and to the extent required by this
Agreement or the Servicing Agreement, as applicable, in accordance with the
REMIC Provisions and in a manner that does not result in a tax on “net income
from foreclosure property” or cause such REO Property to fail to qualify as
“foreclosure property” within the meaning of Section 860G(a)(8) of the
Code.
The
Master Servicer shall enforce each Servicer’s obligation to deposit all funds
collected and received in connection with the operation of any REO Property
in
the related Custodial Account.
The
Master Servicer and the related Servicer, upon the final disposition of any
REO
Property, shall be entitled to reimbursement for any related unreimbursed
Advances and other unreimbursed advances as well as any unpaid Servicing Fees
and Master Servicing Fees from Liquidation Proceeds received in connection
with
the final disposition of such REO Property; provided, that any such unreimbursed
Advances as well as any unpaid Master Servicing Fees may be reimbursed or paid,
as the case may be, prior to final disposition, out of any net rental income
or
other net amounts derived from such REO Property.
Section
4.14 Obligation
of the Master Servicer in Respect of Prepayment Interest
Shortfalls.
The
Master Servicer shall deposit in the Distribution Account not later than each
Distribution Date an amount equal to the lesser of (i) the aggregate amounts
required to be paid by the related Servicer under this Agreement or the
Servicing Agreement, as applicable, with respect to Prepayment Interest
Shortfalls on the Mortgage Loans serviced by such Servicer for the related
Distribution Date, and not so paid by such Servicer and (ii) the Master
Servicing Fee (exclusive of the portion of such fee payable to the Credit Risk
Manager) for such Distribution Date without reimbursement therefor.
ARTICLE
V
ADVANCES
AND DISTRIBUTIONS
Section
5.01 Advances;
Advance Facility.
(a) Each
Servicer shall make an Advance with respect to any Mortgage Loan serviced by
it
and for which an Advance is required hereunder, and deposit such Advance in
the
Distribution Account no later than noon Eastern time on the Remittance Date
in
immediately available funds. The amount of any Advances to be made by a Servicer
on any Distribution Date shall equal (i) the aggregate amount of Scheduled
Payments (net of the related Servicing Fees), due during the related Due Period
in respect of the related Mortgage Loans, which Scheduled Payments were
delinquent as of the close of business on the related Determination Date and
(ii) with respect to each REO Property, which was acquired during or prior
to
the related Prepayment Period and as to which an REO Disposition did not occur
during the related Prepayment Period, an amount equal to the excess, if any,
of
the REO Imputed Interest on such REO Property for the most recently ended
calendar month, over the net income from such REO Property deposited in the
related Custodial Account pursuant to Section 3.26 of this Agreement for
distribution on such Distribution Date; provided, however, no Servicer shall
be
required to make P&I Advances with respect to Relief Act Interest
Shortfalls, shortfalls resulting from a Debt Service Reduction or with respect
to Prepayment Interest Shortfalls in excess of its obligations under Section
5.02. For purposes of the preceding sentence, the Scheduled Payment on each
Balloon Mortgage Loan with a delinquent Balloon Payment is equal to the assumed
monthly payment that would have been due on the related Due Date based on the
original principal amortization schedule for such Balloon Mortgage Loan. Each
Servicer shall be obligated to make any such Advance only to the extent that
such advance would not be a Nonrecoverable Advance. If a Servicer shall have
determined that it has made a Nonrecoverable Advance or that a proposed Advance
or a lesser portion of such Advance would constitute a Nonrecoverable Advance,
such Servicer shall deliver (i) to the Securities Administrator for the benefit
of the Certificateholders funds constituting the remaining portion of such
Advance, if applicable, and (ii) to Master Servicer an Officer’s Certificate
setting forth the basis for such determination. Xxxxx Fargo’s obligation in
respect of Advances is set forth in the Servicing Agreement.
In
lieu
of making all or a portion of such Advance from its own funds, each Servicer
may
(i) cause to be made an appropriate entry in its records relating to its
Custodial Account that any Amounts Held for Future Distribution has been used
by
it in discharge of its obligation to make any such Advance and (ii) transfer
such funds from its Custodial Account to the Distribution Account. Any funds
so
applied and transferred shall be replaced by the related Servicer by deposit
in
the Distribution Account, no later than the close of business on any future
Remittance Date on which the funds on deposit in its Custodial Account shall
be
less than the amount required to be remitted to the Securities Administrator
on
such Remittance Date.
In
addition, Equity One and SPS will be obligated to advance or cause to be
advanced to the Master Servicer, from time to time, Servicing Advances with
respect to the Equity One Mortgage Loans or SPS Mortgage Loans, as applicable,
and Ocwen will be obligated to advance or cause to be advanced to the Master
Servicer, from time to time, from (i) its own funds, (ii) Amounts Held for
Future Distribution or (iii) a combination of (i) and (ii), Servicing Advances
with respect to the Ocwen Mortgage Loans.
The
Securities Administrator will notify the related Servicer and the Master
Servicer by the close of business on the Business Day prior to the Distribution
Date in the event that the amount remitted by such Servicer to the Securities
Administrator on such date is less than the Advances required to be made by
such
Servicer for the related Distribution Date.
Each
Servicer shall be entitled to be reimbursed from its Custodial Account for
all
Advances of its own funds made pursuant to this Section or pursuant to the
Servicing Agreement, as provided in Section 3.27 of this Agreement or in
the Servicing Agreement. The obligation to make Advances with respect to any
Mortgage Loan shall continue until such Mortgage Loan is paid in full or the
related Mortgaged Property or related REO Property has been liquidated or until
the purchase or repurchase thereof (or substitution therefor) from the Trust
Fund pursuant to any applicable provision of this Agreement, except as otherwise
provided in this Section 5.01.
Subject
to and in accordance with the provisions of Article VIII hereof, in the event
that a Servicer fails to make such Advance, then the Master Servicer (or, if
Xxxxx Fargo fails to make such Advance pursuant to the Servicing Agreement,
the
Trustee), as a Successor Servicer, shall be obligated to make such Advance
only
to the extent such Advance, if made, would not constitute a Nonrecoverable
Advance, subject to the provisions of this Section 5.01 and Section
8.02.
(b) (i)
Each
Servicer is hereby authorized to enter into a financing or other facility (any
such arrangement, an “Advance Facility”), the documentation for which complies
with Section 5.01(b)(v) below, under which (1) such Servicer assigns or
pledges its rights under this Agreement to be reimbursed for any or all Advances
and/or Servicing Advances to (i) a Person, which may be a special-purpose
bankruptcy-remote entity (an “SPV”), (ii) a Person, which may simultaneously
assign or pledge such rights to an SPV or (iii) a lender (a “Lender”), which, in
the case of any Person or SPV of the type described in either of the preceding
clauses (i) or (ii), may directly or through other assignees and/or pledgees,
assign or pledge such rights to a Person, which may include a trustee acting
on
behalf of holders of debt instruments (any such Person or any such Lender,
an
“Advance Financing Person”), and/or (2) an Advance Financing Person agrees to
fund all the Advances and/or Servicing Advances required to be made by such
Servicer pursuant to this Agreement. No consent of the Trustee, the Securities
Administrator, the Master Servicer, the Certificateholders or any other party
shall be required before a Servicer may enter into an Advance Facility nor
shall
the Trustee, the Securities Administrator, the Master Servicer, or the
Certificateholders be a third party beneficiary of any obligation of an Advance
Financing Person to such Servicer. Notwithstanding the existence of any Advance
Facility under which an Advance Financing Person agrees to fund Advances and/or
Servicing Advances, (A) the related Servicer (i) shall remain obligated pursuant
to this Agreement to make Advances and/or Servicing Advances pursuant to and
as
required by this Agreement and (ii) shall not be relieved of such obligations
by
virtue of such Advance Facility and (B) neither the Advance Financing Person
nor
any Servicer’s Assignee (as hereinafter defined) shall have any right to proceed
against or otherwise contact any Mortgagor for the purpose of collecting any
payment that may be due with respect to any related Mortgage Loan or enforcing
any covenant of such Mortgagor under the related Mortgage Loan documents.
(ii) If
a
Servicer enters into an Advance Facility, such Servicer and the related Advance
Financing Person shall deliver to the Master Servicer and the Securities
Administrator at the address set forth in Section 11.05 hereof no later
than the Remittance Date immediately following the effective date of such
Advance Facility a written notice (an “Advance Facility Notice”), stating (a)
the identity of the Advance Financing Person and (b) the identity of the Person
(the “Servicer’s Assignee”) that will, subject to Section 5.01(b)(iii)
hereof, have the right to make withdrawals from the related Custodial Account
pursuant to Section 3.27 hereof to reimburse previously unreimbursed
Advances and/or Servicing Advances (“Advance Reimbursement Amounts”). Advance
Reimbursement Amounts (i) shall consist solely of amounts in respect of Advances
and/or Servicing Advances for which the related Servicer would be permitted
to
reimburse itself in accordance with Section 3.27 hereof, assuming the
related Servicer had made the related Advance(s) and/or Servicing Advance(s)
and
(ii) shall not consist of amounts payable to a Successor Servicer in accordance
with Section 3.27 hereof to the extent permitted under
Section 5.01(b)(v) below.
(iii) Notwithstanding
the existence of an Advance Facility, the related Servicer, on behalf of the
Advance Financing Person and the Servicer’s Assignee, shall be entitled to
receive reimbursements of Advances and/or Servicing Advances in accordance
with
Section 3.27 hereof, which entitlement may be terminated by the Advance
Financing Person pursuant to a written notice to the Master Servicer and the
Securities Administrator in the manner set forth in Section 11.05 hereof.
Upon receipt of such written notice, the related Servicer shall no longer be
entitled to receive reimbursement for any Advance Reimbursement Amounts and
the
Servicer’s Assignee shall immediately have the right to receive from the related
Custodial Account all Advance Reimbursement Amounts. Notwithstanding the
foregoing, and for the avoidance of doubt, (i) the related Servicer and/or
the
Servicer’s Assignee shall only be entitled to reimbursement of Advance
Reimbursement Amounts hereunder from withdrawals from the related Custodial
Account pursuant to Section 3.27 of this Agreement and shall not otherwise
be entitled to make withdrawals or receive amounts that shall be deposited
in
the Distribution Account pursuant to Section 3.31 hereof, and (ii) none of
the Trustee or the Certificateholders shall have any right to, or otherwise
be
entitled to, receive any Advance Reimbursement Amounts to which the related
Servicer or the Servicer’s Assignee, as applicable, shall be entitled pursuant
to Section 3.27 hereof. An Advance Facility may be terminated by the joint
written direction of the related Servicer and the related Advance Financing
Person. Written notice of such termination shall be delivered to the Trustee
in
the manner set forth in Section 11.05 hereof. None of the Depositor, Master
Servicer, the Securities Administrator or the Trustee shall, as a result of
the
existence of any Advance Facility, have any additional duty or liability with
respect to the calculation or payment of any Advance Reimbursement Amount,
nor,
as a result of the existence of any Advance Facility, shall the Depositor,
Master Servicer, the Securities Administrator or the Trustee have any additional
responsibility to track or monitor the administration of the Advance Facility
or
the payment of Advance Reimbursement Amounts to the Servicer’s Assignee. The
related Servicer shall indemnify the Master Servicer, the Securities
Administrator, the Depositor, the Trustee, any Successor Servicer and the Trust
Fund for any claim, loss, liability or damage resulting from any claim by the
related Advancing Financing Person, except to the extent that such claim, loss,
liability or damage resulted from or arose out of gross negligence, recklessness
or willful misconduct on the part of the Master Servicer, the Securities
Administrator, the Depositor, the Trustee or any Successor Servicer, as the
case
may be. The related Servicer shall maintain and provide to any Successor
Servicer and, upon request, the Trustee a detailed accounting on a loan-by-loan
basis as to amounts advanced by, pledged or assigned to, and reimbursed to
any
Advancing Financing Person. The Successor Servicer shall be entitled to rely
on
any such information provided by the related Servicer, and the Successor
Servicer shall not be liable for any errors in such information.
(iv) An
Advance Financing Person who receives an assignment or pledge of rights to
receive Advance Reimbursement Amounts and/or whose obligations are limited
to
the funding of Advances and/or Servicing Advances pursuant to an Advance
Facility shall not be required to meet the criteria for qualification as a
Servicer.
(v) As
between a Servicer and its Advance Financing Person, on the one hand, and a
Successor Servicer and its Advance Financing Person, if any, on the other hand,
Advance Reimbursement Amounts on a loan-by-loan basis with respect to each
Mortgage Loan as to which an Advance and/or Servicing Advance shall have been
made and be outstanding shall be allocated on a “first-in, first out” basis. In
the event a Servicer’s Assignee shall have received some or all of an Advance
Reimbursement Amount related to Advances and/or Servicing Advances that were
made by a Person other than such Servicer or its related Advance Financing
Person in error, then the Servicer’s Assignee shall be required to remit any
portion of such Advance Reimbursement Amount to each Person entitled to such
portion of such Advance Reimbursement Amount. Without limiting the generality
of
the foregoing, the related Servicer shall remain entitled to be reimbursed
by
the Advance Financing Person for all Advances and/or Servicing Advances funded
by the related Servicer to the extent the related Advance Reimbursement Amounts
have not been assigned or pledged to such Advance Financing Person or the
Servicer’s Assignee.
(vi) For
purposes of any Officer’s Certificate of a Servicer delivered pursuant to
Section 5.01(a), any Nonrecoverable Advance referred to therein may have
been made by such Servicer. In making its determination that any Advance or
Servicing Advance theretofore made has become a Nonrecoverable Advance, the
related Servicer shall apply the same criteria in making such determination
regardless of whether such Advance or Servicing Advance shall have been made
by
such Servicer.
(vii) Any
amendment to this Section 5.01(b) or to any other provision of this
Agreement that may be necessary or appropriate to effect the terms of an Advance
Facility as described generally in this Section 5.01(b), including
amendments to add provisions relating to a Successor Servicer, may be entered
into by the Master Servicer, the Securities Administrator, the Trustee, the
Depositor and the Servicers without the consent of any Certificateholder,
provided such amendment complies with Section 11.01 hereof. All reasonable
costs and expenses (including attorneys’ fees) of each party hereto of any such
amendment shall be borne solely by the related Servicer. The parties hereto
hereby acknowledge and agree that: (a) the Advances and/or Servicing Advances
financed by and/or pledged to an Advance Financing Person under any Advance
Facility are obligations owed to the related Servicer payable only from the
cash
flows and proceeds received under this Agreement for reimbursement of Advances
and/or Servicing Advances only to the extent provided herein, and none of the
Master Servicer, the Securities Administrator, the Trustee or the Trust are,
as
a result of the existence of any Advance Facility, obligated or liable to repay
any Advances and/or Servicing Advances financed by the Advance Financing Person;
(b) the related Servicer will be responsible for remitting to the related
Advance Financing Person the applicable amounts collected by it as reimbursement
for Advances and/or Servicing Advances funded by such Advance Financing Person,
subject to the provisions of this Agreement; and (c) none of the Master
Servicer, the Securities Administrator or the Trustee shall have any
responsibility to track or monitor the administration of the financing
arrangement between a Servicer and any Advance Financing Person.
Section
5.02 Compensating
Interest Payments.
In
the
event that there is a Prepayment Interest Shortfall arising from a voluntary
Principal Prepayment by the Mortgagor as described in items (a) and (b) of
the
definition of Interest Shortfalls in Article 1 of this Agreement with respect
to
any Equity One Mortgage Loan, Equity One shall, to the extent of the Servicing
Fee for such Distribution Date, deposit into its Custodial Account, as a
reduction of and to the extent of, the Servicing Fee for such Distribution
Date,
no later than the close of business on the Remittance Date immediately preceding
such Distribution Date, an amount equal to the Prepayment Interest Shortfall;
and in case of such deposit, Equity One shall not be entitled to any recovery
or
reimbursement from the Depositor, the Trustee, the Sponsor, the Trust Fund,
the
Master Servicer or the Certificateholders.
In
the
event that there is a Prepayment Interest Shortfall arising from a voluntary
Principal Prepayment in full by the Mortgagor with respect to any Ocwen Mortgage
Loan or SPS Mortgage Loan during the portion of the related Prepayment Period
occurring in the month prior to the month in which the related Distribution
Date
occurs, Ocwen or SPS, as applicable, shall, to the extent of the Servicing
Fee
for such Distribution Date, deposit into its Custodial Account, as a reduction
of and to the extent of, the Servicing Fee for such Distribution Date, no later
than the close of business on the Remittance Date immediately preceding such
Distribution Date, an amount equal to the Prepayment Interest Shortfall; and
in
case of such deposit, neither Ocwen nor SPS shall be entitled to any recovery
or
reimbursement from the Depositor, the Trustee, the Sponsor, the Trust Fund,
the
Master Servicer or the Certificateholders.
Section
5.03 REMIC
Distributions.
On
each
Distribution Date the Securities Administrator shall be deemed to allocate
distributions to the REMIC I Regular Interests and REMIC II Regular Interests
in
accordance with Section 5.07 hereof.
Section
5.04 Distributions.
(a) On
each
Distribution Date, the Securities Administrator will withdraw funds on deposit
in the Distribution Account and make distributions to the Certificateholders
in
accordance with the Remittance Report for such Distribution Date, in the
following order of priority:
(i) On
each
Distribution Date, the Interest Remittance Amount for such Distribution Date,
to
the extent of funds in the Distribution Account, will be paid in the following
order of priority:
| (1) |
from
the Interest Remittance Amount derived from the Group I Mortgage
Loans and
the Group II Mortgage Loans, the Group I Allocation Percentage and
the
Group II Allocation Percentage, as applicable, of any Net Swap Payment
and
any Swap Termination Payment paid to the Supplemental Interest Trust
and
owed to the Swap Provider (unless the Swap Provider is a Defaulting
Party
or the sole Affected Party (as defined in the ISDA Master Agreement)
and
to the extent not paid by the Securities Administrator from any upfront
payment received pursuant to any replacement interest rate swap agreement
that may be entered into by the Supplemental Interest Trust
Trustee);
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| (2) |
from
the Interest Remittance Amount derived from the Group I Mortgage
Loans and
the Group II Mortgage Loans remaining after payments pursuant to
clause
(1) above to the Senior Certificates, pro rata based on amounts due,
Current Interest and any Carryforward Interest for each such class
and
such Distribution Date, provided
that:
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|
(a)
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the
Interest Remittance Amount derived from the Group I Mortgage Loans
will be
distributed in the following order of priority: (x) first, to the
Class
I-A-1 Certificates, Current Interest and any Carryforward Interest
for
such Class for such Distribution Date; and then (y) concurrently,
to the
Class II-A-1, Class II-A-2, Class II-A-3 and Class II-A-4 Certificates,
Current Interest and Carryforward Interest for each such Class for
such
Distribution Date, on a pro rata basis based on the entitlement of
each
such Class, after taking into account the distribution of the Interest
Remittance Amount derived from the Group II Mortgage Loans on such
Distribution Date; and
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|
(b)
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the
Interest Remittance Amount derived from the Group II Mortgage Loans
will
be distributed in the following order of priority: (x) first, concurrently
to the Class II-A-1, Class II-A-2, Class II-A-3 and Class II-A-4
Certificates, Current Interest and any Carryforward Interest for
each such
Class for such Distribution Date, on a pro rata basis based on the
entitlement of each such Class; and then (y) to the Class I-A-1
Certificates, Current Interest and any Carryforward Interest for
such
Class for such Distribution Date, after taking into account the
distribution of the Interest Remittance Amount derived from the Group
I
Mortgage Loans on such Distribution
Date.
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| (3) |
from
the remaining Interest Remittance Amount, to the Class M-1 Certificates,
Current Interest and Carryforward Interest for such Class and Distribution
Date;
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| (4) |
from
the remaining Interest Remittance Amount, to the Class M-2 Certificates,
Current Interest and Carryforward Interest for such Class and Distribution
Date;
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| (5) |
from
the remaining Interest Remittance Amount, to the Class M-3 Certificates,
Current Interest and Carryforward Interest for such Class and Distribution
Date;
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| (6) |
from
the remaining Interest Remittance Amount, to the Class M-4 Certificates,
Current Interest and Carryforward Interest for such Class and Distribution
Date;
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| (7) |
from
the remaining Interest Remittance Amount, to the Class M-5 Certificates,
Current Interest and Carryforward Interest for such Class and Distribution
Date;
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| (8) |
from
the remaining Interest Remittance Amount, to the Class M-6 Certificates,
Current Interest and Carryforward Interest for such Class and Distribution
Date;
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| (9) |
from
the remaining Interest Remittance Amount, to the Class M-7 Certificates,
Current Interest and Carryforward Interest for such Class and Distribution
Date;
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| (10) |
from
the remaining Interest Remittance Amount, to the Class M-8 Certificates,
Current Interest and Carryforward Interest for such Class and Distribution
Date;
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| (11) |
from
the remaining Interest Remittance Amount, to the Class M-9 Certificates,
Current Interest and Carryforward Interest for such Class and Distribution
Date;
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| (12) |
from
the remaining Interest Remittance Amount, to the Class B-1 Certificates,
Current Interest and Carryforward Interest for such Class and Distribution
Date; and
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| (13) |
for
application as part of Monthly Excess Cashflow for such Distribution
Date
pursuant to subclause (iii) below, any such Interest Remittance Amount
remaining after application pursuant to clauses (1) through (12)
above for
such Distribution Date.
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(ii) The
Principal Payment Amount will be paid on each Distribution Date as
follows:
I. On
each
Distribution Date (x) prior to the Stepdown Date or (y) with respect to which
a
Trigger Event is in effect, the Principal Payment Amount will be paid in the
following order of priority:
| (A) |
to
the Supplemental Interest Trust from the Principal Payment Amount
derived
from the Group I Mortgage Loans and the Group II Mortgage Loans,
the Group
I Allocation Percentage and the Group II Allocation Percentage, as
applicable, of any Net Swap Payment and any Swap Termination Payment
owed
to the Swap Provider (unless the Swap Provider is a Defaulting Party
or
the sole Affected Party (as defined in the ISDA Master Agreement)
and to
the extent not paid by the Securities Administrator from any upfront
payment received pursuant to any replacement interest rate swap agreement
that may be entered into by the Supplemental Interest Trust Trustee)
to
the extent not paid from the Interest Remittance Amounts on such
Distribution Date;
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| (B) |
(i)from
the Principal Payment Amount derived from the Group I Mortgage Loans
remaining after payments pursuant to clause (A) above, to the Class
I-A-1 Certificates, until the Certificate Principal Balance thereof
has
been reduced to zero;
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(ii)
from
the
Principal Payment Amount derived from the Group II Mortgage Loans remaining
after payments pursuant to clause (A) above, sequentially, to the Class
II-A-1, Class II-A-2, Class II-A-3 and Class II-A-4 Certificates, in that order,
until the Certificate Principal Balance of each such Class has been reduced
to
zero;
| (C) |
(i)from
the Principal Payment Amount derived from the Group I Mortgage Loans
remaining after payments pursuant to clauses (A) and (B) above and
after the Certificate Principal Balance of the Class I-A-1 Certificates
has been reduced to zero, sequentially, to the Class II-A-1, Class
II-A-2,
Class II-A-3 and Class II-A-4 Certificates, in that order, after
taking
into account payments pursuant to clause I(B)(ii) above, until the
Certificate Principal Balance of each such Class has been reduced
to
zero;
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(ii) from
the
Principal Payment Amount derived from the Group II Mortgage Loans remaining
after payments pursuant to clauses (A) and (B) above and after the
Certificate Principal Balances of the Class II-A-1, Class II-A-2, Class II-A-3
and Class II-A-4 Certificates have been reduced to zero, to the Class I-A-1
Certificates, after taking into account payments pursuant to clause I(B)(i)
above, until its Certificate Principal Balance has been reduced to zero;
| (D) |
to
the Class M-1 Certificates, until its Certificate Principal Balance
has
been reduced to zero;
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| (E) |
to
the Class M-2 Certificates, until its Certificate Principal Balance
has
been reduced to zero;
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| (F) |
to
the Class M-3 Certificates, until its Certificate Principal Balance
has
been reduced to zero;
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| (G) |
to
the Class M-4 Certificates, until its Certificate Principal Balance
has
been reduced to zero;
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| (H) |
to
the Class M-5 Certificates, until its Certificate Principal Balance
has
been reduced to zero;
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| (I) |
to
the Class M-6 Certificates, until its Certificate Principal Balance
has
been reduced to zero;
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| (J) |
to
the Class M-7 Certificates, until its Certificate Principal Balance
has
been reduced to zero;
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| (K) |
to
the Class M-8 Certificates, until its Certificate Principal Balance
has
been reduced to zero;
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| (L) |
to
the Class M-9 Certificates, until its Certificate Principal Balance
has
been reduced to zero;
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| (M) |
to
the Class B-1 Certificates, until its Certificate Principal Balance
has
been reduced to zero; and
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| (N) |
for
application as part of Monthly Excess Cashflow for such Distribution
Date
pursuant to subclause (iii) below, any such Principal Payment Amount
remaining after application pursuant to clauses I(A) through I(M)
above.
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The
foregoing notwithstanding, on and after the Distribution Date on which the
Aggregate Certificate Principal Balance of each Class of Subordinate
Certificates has been reduced to zero, distributions to the Group II
Certificates will be allocated to the Class II-A-1, Class II-A-2, Class II-A-3
and Class II-A-4 Certificates, on a pro rata basis based on the Certificate
Principal Balance of each such Class, until the Certificate Principal Balance
of
each such Class has been reduced to zero.
II. On
each
Distribution Date (x) on or after the Stepdown Date and (y) with respect to
which a Trigger Event is not in effect, the Principal Payment Amount will be
paid in the following order of priority:
| (A) |
to
the Supplemental Interest Trust from the Principal Payment Amount
derived
from the Group I Mortgage Loans and the Group II Mortgage Loans,
the Group
I Allocation Percentage and the Group II Allocation Percentage, as
applicable, of any Net Swap Payment and any Swap Termination Payment
owed
to the Swap Provider (unless the Swap Provider is a Defaulting Party
or
the sole Affected Party (as defined in the ISDA Master Agreement)
and to
the extent not paid by the Securities Administrator from any upfront
payment received pursuant to any replacement interest rate swap agreement
that may be entered into by the Supplemental Interest Trust Trustee)
remaining unpaid after the distribution of the Interest Remittance
Amounts
on such Distribution Date;
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| (B) |
(i)from
the Principal Payment Amount derived from the Group I Mortgage Loans
remaining after payments pursuant to clause (A) above, to the Class
I-A-1
Certificates, the Group I Allocation Amount until its Certificate
Principal Balance has been reduced to zero;
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(ii) from
the
Principal Payment Amount derived from the Group II Mortgage Loans remaining
after payments pursuant to clause (A) above, sequentially, to the Class II-A-1,
Class II-A-2, Class II-A-3 and Class II-A-4 Certificates, in that order, the
Group II Allocation Amount until the Certificate Principal Balance of each
such
Class has been reduced to zero;
| (C) |
(i)from
the Principal Payment Amount derived from the Group I Mortgage Loans
remaining after payments pursuant to clauses (A) and (B) above and
after
the Certificate Principal Balance of the Class I-A-1 Certificates
has been
reduced to zero, sequentially, to the Class II-A-1, Class II-A-2,
Class
II-A-3 and Class II-A-4 Certificates, in that order, up to the Group
II
Allocation Amount remaining unpaid, after taking into account payments
pursuant to clause II(B)(ii) above, until the Certificate Principal
Balance of each such Class has been reduced to
zero;
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(ii) from
the
Principal Payment Amount derived from the Group II Mortgage Loans remaining
after payments pursuant to clauses (A) and (B) above and
after
the Certificate Principal Balances of the Class II-A-1, Class II-A-2, Class
II-A-3 and Class II-A-4 Certificates have been reduced to zero, to the Class
I-A-1 Certificates, to the Class I-A-1 Certificates, up to the Group I
Allocation Amount remaining unpaid, after taking into account payments pursuant
to clause II(B)(i) above, until its Certificate Principal Balance has been
reduced to zero;
| (D) |
to
the Class M-1 Certificates, the Class M-1 Principal Payment Amount
for
such Distribution Date, until its Certificate Principal Balance has
been
reduced to zero;
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| (E) |
to
the Class M-2 Certificates, the Class M-2 Principal Payment Amount
for
such Distribution Date, until its Certificate Principal Balance has
been
reduced to zero;
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| (F) |
to
the Class M-3 Certificates, the Class M-3 Principal Payment Amount
for
such Distribution Date, until its Certificate Principal Balance has
been
reduced to zero;
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| (G) |
to
the Class M-4 Certificates, the Class M-4 Principal Payment Amount
for
such Distribution Date, until its Certificate Principal Balance has
been
reduced to zero;
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| (H) |
to
the Class M-5 Certificates, the Class M-5 Principal Payment Amount
for
such Distribution Date, until its Certificate Principal Balance has
been
reduced to zero;
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| (I) |
to
the Class M-6 Certificates, the Class M-6 Principal Payment Amount
for
such Distribution Date, until its Certificate Principal Balance has
been
reduced to zero;
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| (J) |
to
the Class M-7 Certificates, the Class M-7 Principal Payment Amount
for
such Distribution Date, until its Certificate Principal Balance has
been
reduced to zero;
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| (K) |
to
the Class M-8 Certificates, the Class M-8 Principal Payment Amount
for
such Distribution Date, until its Certificate Principal Balance has
been
reduced to zero;
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| (L) |
to
the Class M-9 Certificates, the Class M-9 Principal Payment Amount
for
such Distribution Date, until its Certificate Principal Balance has
been
reduced to zero;
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| (M) |
to
the Class B-1 Certificates, the Class B-1 Principal Payment Amount
for
such Distribution Date, until its Certificate Principal Balance has
been
reduced to zero; and
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| (N) |
for
application as part of Monthly Excess Cashflow for such Distribution
Date
pursuant to subclause (iii) below, any such Principal Payment Amount
remaining after application pursuant to clauses II(A) through II(M)
above.
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The
foregoing notwithstanding, on and after the Distribution Date on which the
Aggregate Certificate Principal Balance of each Class of Subordinate
Certificates has been reduced to zero, distributions to the Group II
Certificates will be allocated to the Class II-A-1, Class II-A-2, Class II-A-3
and Class II-A-4 Certificates, on a pro rata basis based on the Certificate
Principal Balance of each such Class, until the Certificate Principal Balance
of
each such Class has been reduced to zero.
(iii) On
each
Distribution Date, the Monthly Excess Cashflow will be distributed in the
following order of priority:
| (1) |
(A)
until the aggregate Certificate Principal Balance of the Senior
Certificates and Subordinate Certificates equals the Aggregate Loan
Balance for such Distribution Date (after giving effect to scheduled
payments of principal due during the related Due Period to the extent
received or advanced, unscheduled collections of principal received
during
the related Prepayment Period and after reduction for Realized Losses
on
the Mortgage Loans incurred during the related Due Period) minus
the
Targeted Overcollateralization Amount for such Distribution Date,
on each
Distribution Date (a) prior to the Stepdown Date or (b) with respect
to
which a Trigger Event is in effect, to the extent of Monthly Excess
Interest for such Distribution Date, to the Senior Certificates and
Subordinate Certificates, in the following order of
priority:
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| (i) |
(a)the
Group I Excess Interest Amount in the following order of priority:
(x)
first, to the Class I-A-1 Certificates, until its Certificate Principal
Balance has been reduced to zero, and then (y) sequentially, to the
Class
II-A-1, Class II-A-2, Class II-A-3 and Class II-A-4 Certificates,
in that
order, after taking into account the distribution of the Group II
Excess
Interest Amount, until the Certificate Principal Balance of each
such
Class has been reduced to zero;
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(b) the
Group
II Excess Interest Amount in the following order of priority: (x) first,
sequentially, to the Class II-A-1, Class II-A-2, Class II-A-3 and Class II-A-4
Certificates, in that order, until the Certificate Principal Balance of each
such Class has been reduced to zero, and then (y) to the Class I-A-1
Certificates, after taking into account the distribution of the Group I Excess
Interest Amount, until its Certificate Principal Balance has been reduced to
zero;
(ii) to
the
Class M-1 Certificates, until its Certificate Principal Balance has been reduced
to zero;
(iii) to
the
Class M-2 Certificates, until its Certificate Principal Balance has been reduced
to zero;
(iv) to
the
Class M-3 Certificates, until its Certificate Principal Balance has been reduced
to zero;
(v) to
the
Class M-4 Certificates, until its Certificate Principal Balance has been reduced
to zero;
(vi) to
the
Class M-5 Certificates, until the Certificate Principal Balance thereof has
been
reduced to zero;
(vii) to
the
Class M-6 Certificates, until its Certificate Principal Balance has been reduced
to zero;
(viii) to
the
Class M-7 Certificates, until its Certificate Principal Balance has been reduced
to zero;
(ix) to
the
Class M-8 Certificates, until its Certificate Principal Balance has been reduced
to zero;
(x) to
the
Class M-9 Certificates, until its Certificate Principal Balance has been reduced
to zero; and
(xi) to
the
Class B-1 Certificates, until its Certificate Principal Balance has been reduced
to zero;
(B) on
each
Distribution Date on or after the Stepdown Date and with respect to which a
Trigger Event is not in effect, to
fund
any principal distributions required to be made on such Distribution Date set
forth in Section 5.04(a)(ii)II,
after
giving effect to the distribution of the Principal Payment Amount for such
date,
in accordance with the priorities set forth therein;
(2) to
the
Class M-1 Certificates, any Deferred Amount for such Class;
(3) to
the
Class M-2 Certificates, any Deferred Amount for such Class;
(4) to
the
Class M-3 Certificates, any Deferred Amount for such Class;
(5) to
the
Class M-4 Certificates, any Deferred Amount for such Class;
(6) to
the
Class M-5 Certificates, any Deferred Amount for such Class;
(7) to
the
Class M-6 Certificates, any Deferred Amount for such Class;
(8) to
the
Class M-7 Certificates, any Deferred Amount for such Class;
(9) to
the
Class M-8 Certificates, any Deferred Amount for such Class;
(10) to
the
Class M-9 Certificates, any Deferred Amount for such Class;
(11) to
the
Class B-1 Certificates, any Deferred Amount for such Class;
(12) to
the
Basis Risk Shortfall Reserve Fund and then from the Basis Risk Shortfall Reserve
Fund to the Class I-A-1, Class II-A-1, Class II-A-2, Class II-A-3 and Class
II-A-4 Certificates, concurrently, any Basis Risk Shortfall for each such Class,
on a pro rata basis based on the entitlement of each such Class;
(13) to
the
Basis Risk Shortfall Reserve Fund and then from the Basis Risk Shortfall Reserve
Fund to the Class M-1 Certificates, any Basis Risk Shortfall for such
Class;
(14) to
the
Basis Risk Shortfall Reserve Fund and then from the Basis Risk Shortfall Reserve
Fund to the Class M-2 Certificates, any Basis Risk Shortfall for such
Class;
(15) to
the
Basis Risk Shortfall Reserve Fund and then from the Basis Risk Shortfall Reserve
Fund to the Class M-3 Certificates, any Basis Risk Shortfall for such
Class;
(16) to
the
Basis Risk Shortfall Reserve Fund and then from the Basis Risk Shortfall Reserve
Fund to the Class M-4 Certificates, any Basis Risk Shortfall for such
Class;
(17) to
the
Basis Risk Shortfall Reserve Fund and then from the Basis Risk Shortfall Reserve
Fund to the Class M-5 Certificates, any Basis Risk Shortfall for such
Class;
(18) to
the
Basis Risk Shortfall Reserve Fund and then from the Basis Risk Shortfall Reserve
Fund to the Class M-6 Certificates, any Basis Risk Shortfall for such
Class;
(19) to
the
Basis Risk Shortfall Reserve Fund and then from the Basis Risk Shortfall Reserve
Fund to the Class M-7 Certificates, any Basis Risk Shortfall for such
Class;
(20) to
the
Basis Risk Shortfall Reserve Fund and then from the Basis Risk Shortfall Reserve
Fund to the Class M-8 Certificates, any Basis Risk Shortfall for such
Class;
(21) to
the
Basis Risk Shortfall Reserve Fund and then from the Basis Risk Shortfall Reserve
Fund to the Class M-9 Certificates, any Basis Risk Shortfall for such
Class;
(22) to
the
Basis Risk Shortfall Reserve Fund and then from the Basis Risk Shortfall Reserve
Fund to the Class B-1 Certificates, any Basis Risk Shortfall for such
Class;
(23) to
the
Supplemental Interest Trust, any Swap Termination Payment owed to the Swap
Provider in the event of a Swap Provider Trigger Event and the Swap Provider
is
a Defaulting Party or the sole Affected Party (as defined in the ISDA Master
Agreement) not paid on prior Distribution Dates and to the extent not paid
by
the Securities Administrator from any upfront payment received pursuant to
any
replacement interest rate swap agreement that may be entered into by the
Supplemental Interest Trust Trustee;
(24) to
the
Class X Certificates, the Class X Distribution Amount; and
(25) to
the
Class R Certificates, any remaining amount. It is not anticipated that any
amounts will be distributed to the Class R Certificates under this
clause (25).
Notwithstanding
the foregoing, distributions pursuant to clauses (2) through (22) above on
any
Distribution Date will be made after giving effect to payments received pursuant
to the Basis Risk Cap Agreement, the Swap Agreement and the Interest Rate Cap
Agreement.
(iv) Subject
to Section 10.02 hereof respecting the final distribution on a Class of
Senior Certificates or a Class of Subordinate Certificates, on each Distribution
Date the Securities Administrator shall make distributions to each Holder of
a
Senior Certificate or Subordinate Certificate of record on the preceding Record
Date either by wire transfer in immediately available funds to the account
of
such holder at a bank or other entity having appropriate facilities therefor,
if
(i) such Holder has so notified the Securities Administrator at least five
(5)
Business Days prior to the related Record Date and (ii) such Holder shall hold
Regular Certificates with aggregate principal denominations of not less than
$1,000,000 or evidencing a Percentage Interest aggregating ten percent (10%)
or
more with respect to such Class or, if not, by check mailed by first class
mail
to such Certificateholder at the address of such holder appearing in the
Certificate Register. Notwithstanding the foregoing, but subject to
Section 10.02 hereof respecting the final distribution, distributions with
respect to Senior Certificates and Subordinate Certificates registered in the
name of a Depository shall be made to such Depository in immediately available
funds.
(v) Net
Swap
Payments and Swap Termination Payments (other than Swap Termination Payments
resulting from a Swap Provider Trigger Event) payable by the Supplemental
Interest Trust to the Swap Provider pursuant to the Swap Agreement shall be
deducted from Interest Remittance Amount, and to the extent of any such
remaining amounts due, from Principal Remittance Amount, prior to any
distributions to the Certificateholders. On each Distribution Date, such amounts
will be remitted to the Supplemental Interest Trust, first to make any Net
Swap
Trust Payment owed to the Swap Provider pursuant to the Swap Agreement for
such
Distribution Date, and second to make any Swap Termination Payment (not due
to a
Swap Provider Trigger Event) owed to the Swap Provider pursuant to the Swap
Agreement for such Distribution Date (to the extent not paid by the Securities
Administrator from any upfront payment received pursuant to any replacement
interest rate swap agreement that may be entered into by the Securities
Administrator). Any Swap Termination Payment due as a result of the occurrence
of a Swap Provider Trigger Event owed to the Swap Provider pursuant to the
Swap
Agreement will be subordinated to distributions to the Holders of the Senior
Certificates and Subordinate Certificates and shall be paid as set forth in
Section 5.04(a)(iii)(23).
(b) On
each
Distribution Date, the Securities Administrator shall distribute from the
amounts received from the Swap Provider in respect of any Net Swap Payment
then
on deposit in the Supplemental Interest Trust in the following order of
priority:
(i) concurrently
to the Senior Certificates, on a pro rata basis based on the entitlement of
each
such Class, in an amount equal to any Current Interest and any Carryforward
Interest for such Class or Classes to the extent not covered by the Interest
Remittance Amount on that Distribution Date and solely to the extent the amount
of any Carryforward Interest is a result of the allocation of the interest
portion of Realized Losses;
(ii) sequentially,
to the Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5, Class M-6, Class
M-7, Class M-8, Class M-9 and Class B-1 Certificates, in that order, in an
amount equal to Current Interest and any Carryforward Interest for such Class
or
Classes to the extent not covered by the Interest Remittance Amount on that
Distribution Date and solely to the extent the amount of any Carryforward
Interest is as a result of the allocation of the interest portion of Realized
Losses;
(iii) sequentially,
to the Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5, Class M-6, Class
M-7, Class M-8, Class M-9 and Class B-1 Certificates, in an amount equal to
any
Deferred Amounts, for such Class or Classes, prior to giving effect to amounts
available to be paid in respect of Deferred Amounts pursuant to Section
5.04(iii);
(iv) to
the
holders of the Senior Certificates and Subordinate Certificates then entitled
to
receive distributions in respect of principal, in an amount necessary to
maintain or restore the Targeted Overcollateralization Amount after taking
into
account distributions made pursuant to Section 5.04(iii)(1) in the manner and
order of prioriy set forth in Section 5.04(iii)(1);
(v) to
pay
the Senior Certificates and Subordinate Certificates as follows: first, to
the
Senior Certificates, on a pro rata basis based on the entitlement of each such
Class, based on the aggregate amount of Basis Risk Shortfall Amounts for each
such Class of Senior Certificates, and second, sequentially, to the Class X-0,
Xxxxx X-0, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8,
Class M-9 and Class B-1 Certificates, in that order, any related Basis Risk
Shortfall Amount for such Class or Classes on such Distribution Date but prior
to making distributions in respect of any Basis Risk Shortfall Amounts
distributable pursuant to Section 5.04(iii)(12)-(22); and
(vi)
to
the
Class X Certificates, any remaining amounts.
(c) On
each
Distribution Date, the Securities Administrator shall distribute from the
amounts received under the Interest Rate Cap Agreement on deposit in the
Supplemental Interest Trust in the following order of priority:
(i) concurrently
to the Senior Certificates, on a pro rata basis based on the entitlement of
each
such Class, in an amount equal to any Current Interest and any Carryforward
Interest for such Class or Classes to the extent not covered by the Interest
Remittance Amount or Net Swap Payments paid by the Swap Provider on that
Distribution Date and solely to the extent the amount of any Carryforward
Interest is a result of the allocation of the interest portion of Realized
Losses;
(ii) sequentially,
to the Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5, Class M-6, Class
M-7, Class M-8, Class M-9 and Class B-1 Certificates, in that order, in an
amount equal to Current Interest and any Carryforward Interest for such Class
or
Classes to the extent not covered by the Interest Remittance Amount or Net
Swap
Payments paid by the Swap Provider on that Distribution Date and solely to
the
extent the amount of any Carryforward Interest is as a result of the allocation
of the interest portion of Realized Losses;
(iii) sequentially,
to the Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5, Class M-6, Class
M-7, Class M-8, Class M-9 and Class B-1 Certificates, in an amount equal to
any
Deferred Amounts, for such Class or Classes, prior to giving effect to amounts
available to be paid in respect of Deferred Amounts pursuant to Section
5.04(iii) and after giving effect to any Net Swap Payment paid by the Swap
Provider and available to pay Deferred Amounts;
(iv) to
the
holders of the Senior Certificates and Subordinate Certificates then entitled
to
receive distributions in respect of principal, in an amount necessary to
maintain or restore the Targeted Overcollateralization Amount after taking
into
account distributions made pursuant to Section 5.04(iii)(1) and Net Swap
Payments paid by the Swap Provider;
(v) to
pay
the Senior Certificates and Subordinate Certificates as follows: first, to
the
Senior Certificates, on a pro rata basis based on the entitlement of each such
Class, based on the aggregate amount of Basis Risk Shortfall Amounts for each
such Class of Senior Certificates remaining unpaid after taking into account
any
Net Swap Payment paid by the Swap Provider and available to pay Basis Risk
Shortfalls, and second, sequentially, to the Class X-0, Xxxxx X-0, Class M-3,
Class M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9 and Class
B-1
Certificates, in that order, any related Basis Risk Shortfall Amount for such
Class or Classes remaining unpaid after taking into account any Net Swap Payment
paid by the Swap Provider and available to pay Basis Risk Shortfalls on such
Distribution Date but prior to making distributions in respect of any Basis
Risk
Shortfall Amounts distributable pursuant to Section 5.04(iii)(12)-(22);
and
(vi)
to
the
Class X Certificates, any remaining amounts.
Section
5.05 Allocation
of Realized Losses.
(a) On
or
prior to each Determination Date, the Securities Administrator shall determine
the amount of any Realized Loss in respect of each Mortgage Loan that occurred
during the immediately preceding calendar month, based solely on the reports
delivered by the Servicers pursuant to this Agreement and the Servicing
Agreeement.
(b) The
interest portion of Realized Losses on the Mortgage Loans shall be allocated
to
the Certificates as described in Section 1.02 hereof.
(c) The
principal portion of all Realized Losses on the Mortgage Loans shall be
allocated on each Distribution Date as follows: first, in reduction of payments
made by the Basis Risk Cap Provider under the Basis Risk Cap Agreement, Net
Swap
Payments paid by the Swap Provider under the Interest Rate Swap Agreement,
payments made by the Interest Rate Cap Provider under the Interest Rate Cap
Agreement and the Monthly Excess Cashflow for such Distribution date; second,
to
the Class X Certificates, until the Certificate Principal Balance thereof has
been reduced to zero; third, to the Class B-1 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero; fourth, to
the
Class M-9 Certificates, until the Certificate Principal Balance thereof has
been
reduced to zero; fifth, to the Class M-8 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero; sixth, to the Class M-7
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero; seventh, to the Class M-6 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero; eighth, to the Class M-5 Certificates,
until the Certificate Principal Balance thereof has been reduced to zero; ninth,
to the Class M-4 Certificates, until the Certificate Principal Balance thereof
has been reduced to zero; tenth, to the Class M-3 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero; eleventh, to
the
Class M-2 Certificates, until the Certificate Principal Balance thereof has
been
reduced to zero; and twelfth, to the Class M-1 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero. All such
Realized Losses to be allocated to the Certificate Principal Balances of the
Classes of Subordinate Certificates on any Distribution Date shall be so
allocated after the actual distributions to be made on such date as provided
above. All references above to the Certificate Principal Balance of any Class
of
Subordinate Certificates shall be to the Certificate Principal Balance of such
Class immediately prior to the relevant Distribution Date, before reduction
thereof by any Realized Losses, in each case to be allocated to such Class
of
Certificates, on such Distribution Date.
Any
allocation of the principal portion of Realized Losses to a Class of Subordinate
Certificates on any Distribution Date shall be made by reducing the Certificate
Principal Balance thereof by the amount so allocated; any allocation of Realized
Losses to a Class X Certificate shall be made by reducing the amount otherwise
payable in respect thereof pursuant to Section 5.04(a)(iii)(24). No
allocations of any Realized Losses shall be made to the Certificate Principal
Balances of the Senior Certificates or Class P Certificates.
All
such
Realized Losses and all other losses allocated to a Class of Certificates
hereunder will be allocated among the Certificates of such Class in proportion
to the Percentage Interests evidenced thereby.
(d) Notwithstanding
anything to the contrary contained herein, if on any Distribution Date the
Securities Administrator discovers, based solely on the reports delivered by
the
Servicers under this Agreement or the Servicing Agreement, as applicable, that
any Subsequent Recoveries have been collected by a Servicer with respect to
the
Mortgage Loans, the amount of such Subsequent Recoveries will be applied to
increase the Certificate Principal Balance of the Class of Subordinate
Certificates with the highest payment priority to which Realized Losses on
the
Mortgage Loans have been allocated, but not by more than the amount of Realized
Losses previously allocated to that Class of Subordinate Certificates pursuant
to this Section 5.05. After the Certificate Principal Balances of any Class
of Subordinate Certificates have been increased up to the amount of Realized
Losses allocated thereto pursuant to this Section 5.05 to the extent that
such Applied Loss Amounts have not been paid to such certificates as a Deferred
Amount, any additional Subsequent Recoveries with respect to the Mortgage Loans
will be applied to increase the Certificate Principal Balance of the remaining
Subordinate Certificates, beginning with the Class of Subordinate Certificates
with the next highest payment priority, up to the amount of such Realized Losses
previously allocated to such Class of Certificates pursuant to this
Section 5.05 but only to the extent that any such Applied Loss Amount has
not been paid to any Class of Certificates as a Deferred Amount. Holders of
such
Certificates will not be entitled to any payment in respect of current interest
on the amount of such increases for any Accrual Period preceding the
Distribution Date on which such increase occurs. Any such increases shall be
applied to the Certificate Principal Balance of each Class of Subordinate
Certificate in accordance with its respective Percentage Interest.
(e) With
respect to the REMIC I Regular Interests, all Realized Losses on the Group
I
Mortgage Loans shall be allocated shall be allocated on each Distribution Date
first, to REMIC I Regular Interest I until the Uncertificated Principal Balance
has been reduced to zero, and second, to REMIC I Regular Interest I-1-A through
REMIC I Regular Interest I-54-B, starting with the lowest numerical denomination
until such REMIC I Regular Interest has been reduced to zero, provided that,
for
REMIC I Regular Interests with the same numerical denomination, such Realized
Losses shall be allocated pro rata between such REMIC I Regular Interests.
All
Realized Losses on the Group II Mortgage Loans shall be allocated on each
Distribution Date first, to REMIC I Regular Interest II until the Uncertificated
Principal Balance has been reduced to zero, and second, to REMIC I Regular
Interest II-1-A through REMIC I Regular Interest II-54-B, starting with the
lowest numerical denomination until such REMIC I Regular Interest has been
reduced to zero, provided that, for REMIC I Regular Interests with the same
numerical denomination, such Realized Losses shall be allocated pro rata between
such REMIC I Regular Interests.
(f) With
respect to the REMIC I Regular Interests, all Realized Losses on the Mortgage
Loans shall be allocated shall be allocated on each Distribution Date first,
to
REMIC I Regular Interest I until the Uncertificated Principal Balance has been
reduced to zero, and second, to REMIC I Regular Interest I-1-A through REMIC
I
Regular Interest I-60-B, starting with the lowest numerical denomination until
such REMIC I Regular Interest has been reduced to zero, provided that, for
REMIC
I Regular Interests with the same numerical denomination, such Realized Losses
shall be allocated pro rata between such REMIC I Regular Interests.
All
Realized Losses on the Mortgage Loans shall be allocated on each Distribution
Date to the following REMIC II Regular Interests in the specified percentages,
as follows: first, to Uncertificated Accrued Interest payable to the REMIC
II
Regular Interest LT-AA and REMIC II Regular Interest LT-ZZ up to an aggregate
amount equal to the REMIC II Interest Loss Allocation Amount, 98% and 2%,
respectively; second, to the Uncertificated Principal Balances of REMIC II
Regular Interest LT-AA and REMIC II Regular Interest LT-ZZ up to an aggregate
amount equal to the REMIC II Principal Loss Allocation Amount, 98% and 2%,
respectively; third, to the Uncertificated Principal Balances of REMIC II
Regular Interest LT-AA, REMIC II Regular Interest LT-B1 and REMIC II Regular
Interest LT-ZZ, 98%, 1% and 1%, respectively, until the Uncertificated Principal
Balance of REMIC II Regular Interest LT-B1 has been reduced to zero; fourth,
to
the Uncertificated Principal Balances of REMIC II Regular Interest LT-AA, REMIC
II Regular Interest LT-M9 and REMIC II Regular Interest LT-ZZ, 98%, 1% and
1%,
respectively, until the Uncertificated Principal Balance of REMIC II Regular
Interest LT-M9 has been reduced to zero; fifth, to the Uncertificated Principal
Balances of REMIC II Regular Interest LT-AA, REMIC II Regular Interest LT-M8
and
REMIC II Regular Interest LT-ZZ, 98%, 1% and 1%, respectively, until the
Uncertificated Principal Balance of REMIC II Regular Interest LT-M8 has been
reduced to zero; sixth, to the Uncertificated Principal Balances of REMIC II
Regular Interest LT-AA, REMIC II Regular Interest LT-M7 and REMIC II Regular
Interest LT-ZZ, 98%, 1% and 1%, respectively, until the Uncertificated Principal
Balance of REMIC II Regular Interest LT-M7 has been reduced to zero; seventh,
to
the Uncertificated Principal Balances of REMIC II Regular Interest LT-AA, REMIC
II Regular Interest LT-M6 and REMIC II Regular Interest LT-ZZ, 98%, 1% and
1%,
respectively, until the Uncertificated Principal Balance of REMIC II Regular
Interest LT-M6 has been reduced to zero; eighth, to the Uncertificated Principal
Balances of REMIC II Regular Interest LT-AA, REMIC II Regular Interest LT-M5
and
REMIC II Regular Interest LT-ZZ, 98%, 1% and 1%, respectively, until the
Uncertificated Principal Balance of REMIC II Regular Interest LT-M5 has been
reduced to zero; ninth, to the Uncertificated Principal Balances of REMIC II
Regular Interest LT-AA, REMIC II Regular Interest LT-M4 and REMIC II Regular
Interest LT-ZZ, 98%, 1% and 1%, respectively, until the Uncertificated Principal
Balance of REMIC II Regular Interest LT-M4 has been reduced to zero; tenth,
to
the Uncertificated Principal Balances of REMIC II Regular Interest LT-AA, REMIC
II Regular Interest LT-M3 and REMIC II Regular Interest LT-ZZ, 98%, 1% and
1%,
respectively, until the Uncertificated Principal Balance of REMIC II Regular
Interest LT-M3 has been reduced to zero; eleventh, to the Uncertificated
Principal Balances of REMIC II Regular Interest LT-AA, REMIC II Regular Interest
LT-M2 and REMIC II Regular Interest LT-ZZ, 98%, 1% and 1%, respectively, until
the Uncertificated Principal Balance of REMIC II Regular Interest LT-M2 has
been
reduced to zero; and twelfth, to the Uncertificated Principal Balances of REMIC
II Regular Interest LT-AA, REMIC II Regular Interest LT-M1 and REMIC II Regular
Interest LT-ZZ, 98%, 1% and 1%, respectively, until the Uncertificated Principal
Balance of REMIC II Regular Interest LT-M1 has been reduced to
zero.
Section
5.06 Monthly
Statements to Certificateholders.
(a) Not
later
than each Distribution Date, the Securities Administrator shall prepare and
make
available to each Holder of Certificates, the Depositor, the Servicer and the
Credit Risk Manager via its website a statement setting forth the following
information for the Certificates:
(i) the
Interest Accrual Period and Distribution Date for each Class of
Certificates;
(ii) the
Pass-Through Rate for each Class of Certificates with respect to the current
Accrual Period;
(iii) with
respect to each Loan Group, the total cash flows received and the general
sources thereof;
(iv) the
amount of the related distribution to Holders of each Class allocable to
principal, separately identifying (A) the aggregate amount of any Principal
Prepayments included therein, (B) the aggregate of all scheduled payments of
principal included therein, (C) the Monthly Excess Interest with respect to
the
Certificates (if any) and (D) the amount of Prepayment Charges distributed
to
the Class P Certificates;
(v) the
amount distributed to Holders of each Class on such Distribution Date allocable
to interest;
(vi) the
Certificate Principal Balance of each Class of Certificates, if applicable,
after giving effect (i) to all distributions allocable to principal on such
Distribution Date and (ii) the allocation of any Realized Losses for such
Distribution Date;
(vii) the
aggregate amount of P&I Advances included in the distributions on the
Distribution Date;
(viii) the
aggregate amount of Relief Act Interest Shortfalls for such Distribution
Date;
(ix) the
aggregate amount of any Prepayment Interest Shortfall for such Distribution
Date, to the extent not covered by payments by the Servicers pursuant to
Section 5.02 of this Agreement or the Servicing Agreement, as applicable,
or the Master Servicer pursuant to Section 4.14 of this
Agreement;
(x) the
cumulative amount of Realized Losses to date and, in addition, if the
Certificate Principal Balance of any Class of Certificates have been reduced
to
zero, the cumulative amount of any Realized Losses that have not been allocated
to any Class of Certificates;
(xi) the
Overcollateralization Amount and the Senior Enhancement Percentage, any
Overcollateralization Deficiency Amount and any Overcollateralization Release
Amount for such Distribution Date
(xii) with
respect to each Loan Group, the amount of any Prepayment Charges remitted by
the
Servicers;
(xiii) the
number, aggregate principal balance, weighted average remaining term to maturity
and weighted average Mortgage Rate of the Mortgage Loans as of the related
Due
Date;
(xiv) with
respect to each Loan Group, the number and Scheduled Principal Balance of all
the Mortgage Loans for the following Distribution Date;
(xv) the
number and aggregate principal balance of any Mortgage Loans that were (A)
delinquent (exclusive of Mortgage Loans in foreclosure) using the “OTS” method
(not including Liquidated Mortgage Loans as of the end of the related Prepayment
Period) (1) one scheduled payment is delinquent, (2) two scheduled payments
are
delinquent, (3) three scheduled payments are delinquent and (4) foreclosure
proceedings have been commenced, and loss information for the period; the number
and aggregate principal balance of any Mortgage Loans in respect of which (A)
one scheduled payment is delinquent, (B) two scheduled payments are delinquent,
(C) three or more scheduled payments are delinquent and (D) foreclosure
proceedings have been commenced, and loss information for the
period;
(xvi) with
respect to any Mortgage Loan that was liquidated during the preceding calendar
month, the loan number and the Stated Principal Balance of, and Realized Loss
on, such Mortgage Loan as of the close of business on the Determination Date
preceding such Distribution Date;
(xvii) the
total
number and principal balance of any real estate owned or REO Properties in
each
Loan Group and the Mortgage Loans in the aggregate as of the close of business
on the Determination Date preceding such Distribution Date;
(xviii) the
three
month rolling average of the percent equivalent of a fraction, the numerator
of
which is the Aggregate Loan Group Balance of the Mortgage Loans in a Loan Group
that are sixty (60) days or more delinquent or are in bankruptcy or foreclosure
or are REO Properties, and the denominator of which is the Aggregate Loan Group
Balance of all of the Mortgage Loans in such Loan Group as of the last day
of
the related Due Period;
(xix) the
aggregate Servicing Fee received by the Servicer, and the Master Servicing
Fees,
if any, received by the Master Servicer during the related Due
Period;
(xx) the
amount, if any, of other fees or expenses accrued and paid, with an
identification of the payee and the general purpose of such fees;
(xxi) the
amount of any Basis Risk Shortfalls and the amount in the Basis Risk Shortfall
Reserve Fund after all deposits and withdrawals on such Distribution Date;
(xxii) amounts
payable in respect of the Basis Risk Cap Agreement;
(xxiii) amounts
payable in respect of the Swap Agreement;
(xxiv) amounts
payable in respect of the Interest Rate Cap Agreement; and
(xxv) whether
the Stepdown Date has occurred and whether any Trigger Event is in
effect.
The
Securities Administrator may make the foregoing monthly statement (and, at
its
option, any additional files containing the same information in an alternative
format) available each month to Certificateholders via the Securities
Administrator’s internet website. The Securities Administrator’s internet
website shall initially be located at “xxx.xxxxxxx.xxx”. Assistance in using the
website can be obtained by calling the Securities Administrator’s customer
service desk at (000) 000-0000. Parties that are unable to use the above
distribution options are entitled to have a paper copy mailed to them via first
class mail by calling the customer service desk and indicating such. The
Securities Administrator may change the way monthly statements are distributed
in order to make such distributions more convenient or more accessible to the
above parties.
The
Securities Administrator shall be entitled to rely on but shall not be
responsible for the content or accuracy of any information provided by third
parties for purposes of preparing such statement and may affix thereto any
disclaimer it deems appropriate in its reasonable discretion (without suggesting
liability on the part of any other party hereto).
(b) The
Securities Administrator’s responsibility for making the above information
available to the Certificateholders is limited to the availability, timeliness
and accuracy of the information provided by the Servicer, the Basis Risk Cap
Provider, the Swap Provider and the Interest Rate Cap Provider. The Securities
Administrator will make available a copy of each statement provided pursuant
to
this Section 5.06 to each Rating Agency.
(c) Within
a
reasonable period of time after the end of each calendar year, the Securities
Administrator shall cause to be furnished upon written request to each Person
who at any time during the calendar year was a Certificateholder, a statement
containing the information set forth in clauses (a)(i) and (a)(ii) of this
Section 5.06 aggregated for such calendar year or applicable portion
thereof during which such Person was a Certificateholder. Such obligation of
the
Securities Administrator shall be deemed to have been satisfied to the extent
that substantially comparable information shall be provided by the Securities
Administrator pursuant to any requirements of the Code as from time to time
in
effect.
(d) Upon
filing with the Internal Revenue Service, the Securities Administrator shall
furnish to the Holders of the Residual Certificates the applicable Form 1066
and
each applicable Form 1066Q and shall respond promptly to written requests made
not more frequently than quarterly by any Holder of a Residual Certificate
with
respect to the following matters:
(i) The
original projected principal and interest cash flows on the Closing Date on
each
Class of regular and residual interests created hereunder and on the Mortgage
Loans, based on the Prepayment Assumption;
(ii) The
projected remaining principal and interest cash flows as of the end of any
calendar quarter with respect to each Class of regular and residual interests
created hereunder and the Mortgage Loans, based on the Prepayment
Assumption;
(iii) The
applicable Prepayment Assumption and any interest rate assumptions used in
determining the projected principal and interest cash flows described
above;
(iv) The
original issue discount (or, in the case of the Mortgage Loans, market discount)
or premium accrued or amortized through the end of such calendar quarter with
respect to each Class of regular or residual interests created hereunder and
to
the Mortgage Loans, together with each constant yield to maturity used in
computing the same;
(v) The
treatment of losses realized with respect to the Mortgage Loans or the regular
interests created hereunder, including the timing and amount of any cancellation
of indebtedness income of a REMIC with respect to such regular interests or
bad
debt deductions claimed with respect to the Mortgage Loans;
(vi) The
amount and timing of any non-interest expenses of a REMIC; and
(vii) Any
taxes
(including penalties and interest) imposed on the REMIC, including, without
limitation, taxes on “prohibited transactions,” “contributions” or “net income
from foreclosure property” or state or local income or franchise
taxes.
The
information pursuant to clauses (i), (ii), (iii) and (iv) above shall be
provided by the Depositor pursuant to Section 9.13.
Section
5.07 REMIC
Designations, REMIC I, REMIC II, REMIC III, REMIC IV, REMIC V and REMIC VI
Allocations.
(a) The
Securities Administrator shall elect that each of REMIC I, REMIC II, REMIC
III,
REMIC IV, REMIC V and REMIC VI shall be treated as a REMIC under
Section 860D of the Code. Any inconsistencies or ambiguities in this
Agreement or in the administration of this Agreement shall be resolved in a
manner that preserves the validity of such REMIC elections. The REMIC I Regular
Interests shall constitute the assets of REMIC II. The REMIC II Regular
Interests shall constitute the assets of REMIC III.
(b) On
each
Distribution Date, the following amounts, in the following order of priority
and
in accordance with the Remittance Report, shall be distributed by REMIC I to
REMIC II on account of the REMIC I Regular Interests or withdrawn from the
Distribution Account and distributed to the Holders of the Class R-I Interest,
as the case may be:
(i) to
Holders of each of REMIC I Regular Interest I and REMIC I Regular Interest
I-1-A
through I-54-B, pro rata, in an amount equal to (A) the Uncertificated Accrued
Interest for such REMIC I Regular Interests for such Distribution Date, plus
(B)
any amounts payable in respect thereof remaining unpaid from previous
Distribution Dates;
(ii) to
the
extent of amounts remaining after the distributions made pursuant to clause
(i)
above, payments of principal shall be allocated to REMIC I Regular Interest
I,
then to REMIC I Regular Interests I-1-A through I-54-B starting with the lowest
numerical denomination until the Uncertificated Principal Balance of each such
REMIC I Regular Interest is reduced to zero, provided that, for REMIC I Regular
Interests with the same numerical denomination, such payments of principal
shall
be allocated pro rata between such REMIC I Regular Interests; and
(iii) to
the
Holders of REMIC I Regular Interest P, (A) on each Distribution Date, 100%
of
the amount paid in respect of Prepayment Charges and (B) on the Distribution
Date in January 2012 until $100 has been distributed pursuant to this
clause.
(c) On
each
Distribution Date, the following amounts, in the following order of priority
and
in accordance with the Remittance Report, shall be distributed by REMIC II
to
REMIC III on account of the REMIC II Regular Interests or withdrawn from the
Distribution Account and distributed to the Holders of the Class R-II Interest,
as the case may be:
(i) first,
to
the Holder of REMIC II Regular Interest LT-IO in an amount equal to (A) the
Uncertificated Accrued Interest for each such REMIC II Regular Interest for
such
Distribution Date, plus (B) any amounts in respect thereof remaining unpaid
from
previous Distribution Dates and then to the Holders of REMIC II Regular Interest
LT-AA, REMIC
II
Regular Interest LT-IA1,
REMIC II
Regular Interest LT-IIA1, REMIC II Regular Interest LT-IIA2, REMIC II Regular
Interest LT-IIA3, REMIC II Regular Interest LT-IIA4, REMIC II Regular Interest
LT-M1, REMIC II Regular Interest LT-M2, REMIC II Regular Interest LT-M3, REMIC
II Regular Interest LT-M4, REMIC II Regular Interest LT-M5, REMIC II Regular
Interest LT-M6, REMIC II Regular Interest LT-M7, REMIC II Regular Interest
LT-M8, REMIC II Regular Interest LT-M9, REMIC II Regular Interest LT-B1 and
REMIC II Regular Interest LT-ZZ, pro rata, in an amount equal to (A) the
Uncertificated Accrued Interest for each such REMIC II Regular Interest for
such
Distribution Date, plus (B) any amounts in respect thereof remaining unpaid
from
previous Distribution Dates. Amounts payable as Uncertificated Accrued Interest
in respect of REMIC II Regular Interest LT-ZZ shall be reduced and deferred
when
the REMIC II Overcollateralization Amount is less than the REMIC II Targeted
Overcollateralization Amount, by the lesser of (x) the amount of such difference
and (y) the REMIC II Regular Interest LT-ZZ Maximum Interest Deferral Amount
and
such amount will be payable to the Holders of REMIC II Regular Interest LT-IA1,
REMIC II Regular Interest LT-IIA1, REMIC II Regular Interest LT-IIA2, REMIC
II
Regular Interest LT-IIA3, REMIC II Regular Interest LT-IIA4, REMIC II Regular
Interest LT-M1, REMIC II Regular Interest LT-M2, REMIC II Regular Interest
LT-M3, REMIC II Regular Interest LT-M4, REMIC II Regular Interest LT-M5, REMIC
II Regular Interest LT-M6, REMIC II Regular Interest LT-M7, REMIC II Regular
Interest LT-M8, REMIC II Regular Interest LT-M9 and REMIC II Regular Interest
LT-B1 in the same proportion as the Overcollateralization Deficiency is
allocated to the Corresponding Certificates and the Uncertificated Principal
Balance of REMIC II Regular Interest LT-ZZ shall be increased by such
amount;
(ii) second,
to the Holders of REMIC II Regular Interests, in an amount equal to the
remainder of the Interest Remittance Amount and the Principal Payment Amount
for
such Distribution Date after the distributions made pursuant to clause (i)
above, allocated as follows:
(A) 98.00%
of
such remainder (other than amounts payable under clause (C) below) to the
Holders of REMIC II Regular Interest LT-AA and REMIC II Regular Interest LT-P,
until the Uncertificated Principal Balance of such REMIC II Regular Interest
is
reduced to zero, provided, however, that the Uncertificated Principal Balance
of
REMIC II Regular Interest LT-P shall not be reduced until the Distribution
Date
in January 2012 or any Distribution Date thereafter, at which point such amount
shall be distributed to REMIC II Regular Interest LT-P, until $100 has been
distributed pursuant to this clause;
(B) 2.00%
of
such remainder, first, to the Holders REMIC II Regular Interest LT-IA1, REMIC
II
Regular Interest LT-IIA1, REMIC II Regular Interest LT-IIA2, REMIC II Regular
Interest LT-IIA3, REMIC II Regular Interest LT-IIA4, REMIC II Regular Interest
LT-M1, REMIC II Regular Interest LT-M2, REMIC II Regular Interest LT-M3, REMIC
II Regular Interest LT-M4, REMIC II Regular Interest LT-M5, REMIC II Regular
Interest LT-M6, REMIC II Regular Interest LT-M7, REMIC II Regular Interest
LT-M8, REMIC II Regular Interest LT-M9 and REMIC II Regular Interest LT-B1,
1%
in the same proportion as principal payments are allocated to the Corresponding
Certificates, until the Uncertificated Principal Balances of such REMIC II
Regular Interests are reduced to zero and second, to the Holders of REMIC II
Regular Interest LT-ZZ (other than amounts payable under the proviso below),
until the Uncertificated Principal Balance of such REMIC II Regular Interest
is
reduced to zero; and
(C) any
remaining amount to the Holders of the Class R Certificates (in respect of
the
Class R-II Interest).
provided,
however, that (i) 98.00% and (ii) 2.00% of any principal payments that are
attributable to an Overcollateralization Release Amount shall be allocated
to
Holders of (i) REMIC II Regular Interest LT-AA and REMIC II Regular Interest
LT-P, in that order and (ii) REMIC II Regular Interest LT-ZZ, respectively;
provided that REMIC II Regular Interest LT-P shall not be reduced until the
Distribution Date in January 2012, at which point such amount shall be
distributed to REMIC II Regular Interest LT-P, until $100 has been distributed
pursuant to this clause.
(iii) all
amounts paid to the Class X Certificates shall be deemed to be distributed
to
the Class X Interest;
(iv) all
amounts paid to the Class P Certificates shall be deemed to be distributed
to
the Class P Interest; and
(v) all
amounts paid to REMIC VI Regular Interest IO shall be deemed to be distributed
to the Class IO Interest.
Section
5.08 Prepayment
Charges.
On
each
Distribution Date, all amounts representing Prepayment Charges in respect of
the
Mortgage Loans received during the related Prepayment Period and deposited
in
the Distribution Account will be withdrawn from the Distribution Account and
distributed by the Securities Administrator in accordance with the Remittance
Report to the Class P Certificates and shall not be available for distribution
to the holders of any other Class of Certificates. The payment of such
Prepayment Charges shall not reduce the Certificate Principal Balance of the
Class P Certificates. The Master Servicer shall not be responsible for
calculating or otherwise verifying Prepayment Charge amounts.
Section
5.09 Class
P Certificate Account.
The
Securities Administrator shall establish and maintain with itself a separate,
segregated trust account titled “Xxxxx Fargo Bank, NA, as Securities
Administrator, for the benefit of Nomura Home Equity Loan, Inc., Home Equity
Loan Trust 2007-2 Class P Certificate Account”. On the Closing Date, the
Depositor will deposit, or cause to be deposited in the Class P Certificate
Account $100.00. The amount on deposit in the Class P Certificate Account shall
be held uninvested. On the January 2012 Distribution Date, the Securities
Administrator shall withdraw the amount on deposit in the Class P Certificate
Account and remit such amount to the Holders of the Class P Certificates, in
reduction of the Certificate Principal Balance thereof.
Section
5.10 [Reserved].
Section
5.11 Basis
Risk Shortfall Reserve Fund.
(a) The
Securities Administrator shall establish a Basis Risk Shortfall Reserve Fund
on
behalf of the holders of the Senior Certificates and the Subordinate
Certificates. The Basis Risk Shortfall Reserve Fund must be an Eligible Account.
The Basis Risk Shortfall Reserve Fund shall be entitled “Basis Risk Shortfall
Reserve Fund, HSBC Bank USA, National Association, as Trustee for the benefit
of
holders of Nomura Home Equity Loan, Inc., Asset-Backed Certificates, Series
2007-2, Class I-A-1, Class II-A-1, Class II-A-2, Class II-A-3, Class II-A-4,
Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7,
Class M-8, Class M-9 and Class B-1 Certificates”. On the Closing Date, the
Depositor will deposit, or cause to be deposited, into the Basis Risk Shortfall
Reserve Fund $1,000. On each Distribution Date as to which there is a Basis
Risk
Shortfall payable to any Class of Certificates, the Securities Administrator
shall deposit the amounts pursuant to paragraphs (12) through (22) of
Section 5.04(a)(iii) into the Basis Risk Shortfall Reserve Fund and the
Securities Administrator has been directed by the Class X Certificateholder
to
distribute such amounts to the Holders of the Senior Certificates and
Subordinate Certificates in the amounts and priorities set forth in
Section 5.04(a)(iii).
(b) The
Basis
Risk Shortfall Reserve Fund is an “outside reserve fund” within the meaning of
Treasury Regulation §1.860G-2(h) and shall be an asset of the Trust Fund but not
an asset of any REMIC. The Securities Administrator on behalf of the Trust
shall
be the nominal owner of the Basis Risk Shortfall Reserve Fund. The Class X
Certificateholders shall be the beneficial owners of the Basis Risk Shortfall
Reserve Fund, subject to the power of the Securities Administrator to transfer
amounts under Section 5.04(a)(iii). Amounts in the Basis Risk Shortfall
Reserve Fund shall be held either uninvested in a trust or deposit account
of
the Securities Administrator with no liability for interest or other
compensation thereof or, at the written direction of the Majority Class X
Certificateholder, be invested in Permitted Investments that mature no later
than the Business Day prior to the next succeeding Distribution Date. All net
income and gain from such investments shall be distributed to the Majority
Class
X Certificateholder, not as a distribution in respect of any interest in any
REMIC, on such Distribution Date. All amounts earned on amounts on deposit
in
the Basis Risk Shortfall Reserve Fund shall be taxable to the Majority Class
X
Certificateholder. Any losses on such investments shall be deposited in the
Basis Risk Shortfall Reserve Fund by the Majority Class X Certificateholder
out
of its own funds immediately as realized. In the event that the Majority Class
X
Certificateholder shall fail to provide investment instructions to the
Securities Administrator, the amounts on deposit in the Basis Risk Shortfall
Reserve Fund shall be held uninvested.
(c) For
federal tax return and information reporting, the value of the right of the
holders of the Senior Certificates and Subordinate Certificates
to
receive payments from the Basis Risk Shortfall Reserve Fund in respect of any
Basis Risk Shortfall shall
be
zero dollars ($0.00).
Section
5.12 Supplemental
Interest Trust.
(a) On
the
Closing Date, the Securities Administrator shall establish and maintain in
the
name of the Trustee a separate account for the benefit of the holders of the
Senior Certificates and Subordinate Certificates (the “Supplemental Interest
Trust”). The Supplemental Interest Trust shall be an Eligible Account, and funds
on deposit therein shall be held separate and apart from, and shall not be
commingled with, any other moneys, including, without limitation, other moneys
of the Trustee or of the Securities Administrator held pursuant to this
Agreement.
(b) On
each
Distribution Date, the Securities Administrator shall deposit into the
Supplemental Interest Trust amounts distributable to the Swap Provider by the
Supplemental Interest Trust pursuant to Sections 5.04(a)(i)(1),
5.04(a)(ii)(I)(A), 5.04(a)(ii)(II)(A) and 5.04(a)(iii)(23) of this Agreement.
On
each Distribution Date, the Securities Administrator shall distribute any such
amounts to the Swap Provider pursuant to the Swap Agreement, first to pay any
Net Swap Payment owed to the Swap Provider for such Distribution Date, and
second to pay any Swap Termination Payment owed to the Swap Provider. For the
avoidance of doubt, any upfront payment (an “Upfront Payment”) paid by the Swap
Provider on the Closing Date shall not be an asset of the Supplemental Interest
Trust. The Securities Administrator shall remit any such Upfront Payment to
the
Sponsor on the first Distribution Date.
(c) On
each
Distribution Date, the Securities Administrator shall deposit into the
Supplemental Interest Trust amounts received by it from the Swap Provider.
On
each Distribution Date, the Securities Administrator shall distribute from
the
Supplemental Interest Trust an amount equal to the amount of any Net Swap
Payment received from the Swap Provider under the Swap Agreement, and make
the
distributions required under Section 5.04(b) of this Agreement.
(d) On
each
Distribution Date, the Securities Administrator shall deposit into the
Supplemental Interest Trust amounts received by it from the Interest Rate Cap
Provider. On each Distribution Date, the Securities Administrator shall
distribute from the Supplemental Interest Trust an amount equal to any amounts
paid under the Interest Rate Cap Agreement on deposit in the Supplemental
Interest Trust, and make the distributions required under Section 5.04(c) of
this Agreement.
(e) On
each
Distribution Date, the Securities Administrator will deposit into the
Supplemental Interest Trust all amounts received under the Basis Risk Cap
Agreement. On each Distribution Date, the Securities Administrator will make
payments to the Senior Certificates and Subordinate Certificates in respect
of
Basis Risk Shortfalls remaining after taking into accounts amounts paid under
the Swap Agreement and the Interest Rate Cap Agreement and available for this
purpose, in the following manner and order of priority: first, concurrently
to
the Senior Certificates, on a pro rata basis, based on the entitlement of each
such Class, the amount of any Basis Risk Shortfalls allocated to such Class
for
such Distribution Date; second, to the Class M-1 Certificates, the amount of
any
Basis Risk Shortfall allocated to such Class for such Distribution Date for
such
Class; third, to the Class M-2 Certificates, the amount of any Basis Risk
Shortfall allocated to such Class for such Distribution Date for such Class;
fourth, to the Class M-3 Certificates, the amount of any Basis Risk Shortfalls
allocated to such Class for such Distribution Date for such Class; fifth, to
the
Class M-4 Certificates, the amount of any Basis Risk Shortfalls allocated to
such Class for such Distribution Date; sixth, to the Class M-5 Certificates,
the
amount of any Basis Risk Shortfalls allocated to such Class for such
Distribution Date; seventh, to the Class M-6 Certificates, the amount of any
Basis Risk Shortfall allocated to such Class for such Distribution Date for
such
Class; eighth, to the Class M-7 Certificates, the amount of any Basis Risk
Shortfall allocated to such Class for such Distribution Date for such Class;
ninth, to the Class M-8 Certificates, the amount of any Basis Risk Shortfall
allocated to such Class for such Distribution Date for such Class; tenth, to
the
Class M-9 Certificates, the amount of any Basis Risk Shortfall allocated to
such
Class for such Distribution Date for such Class; and eleventh, to the Class
B-1
Certificates, the amount of any Basis Risk Shortfall allocated to such Class
for
such Distribution Date for such Class.
(f) Upon
a
Basis Risk Cap Agreement Early Termination other than in connection with the
optional termination of the Trust Fund, the Trustee will use reasonable efforts
to appoint a successor basis risk cap provider to enter into a new basis risk
cap agreement on terms substantially similar to the basis risk cap agreement,
with a successor basis risk cap provider meeting all applicable eligibility
requirements. The Securities Administrator will apply any Basis Risk Cap
Agreement Termination Payment received from the original Basis Risk Cap Provider
in connection with such Basis Risk Cap Agreement Early Termination to the
upfront payment required to appoint the successor basis risk cap provider.
If
the
Trustee is unable to appoint a successor basis risk cap provider within thirty
(30) days of the Basis Risk Cap Agreement Early Termination, then the Securities
Administrator will deposit any Basis Risk Cap Agreement Termination Payment
received from the original Basis Risk Cap Provider into a separate, non-interest
bearing reserve account and will, on each subsequent Distribution Date, withdraw
from the amount then remaining on deposit in such reserve account an amount
equal to the payment, if any, that would have been paid to the Securities
Administrator by the original Basis Risk Cap Provider calculated in accordance
with the terms of the original Basis Risk Cap Agreement, and distribute such
amount in accordance with the terms of this Agreement.
(g) The
Supplemental Interest Trust constitutes an “outside reserve fund” within the
meaning of Treasury Regulation § 1.860G-2(h) and is not an asset of any REMIC.
The Holders of the Class X Certificates shall be the beneficial owner of the
Supplemental Interest Trust, subject to the power of the Securities
Administrator to transfer amounts under this Agreement. The Securities
Administrator shall keep records that accurately reflect the funds on deposit
in
the Supplemental Interest Trust. The Securities Administrator shall, at the
written direction of the holder of the Majority Class X Certificateholder,
invest amounts on deposit in the Supplemental Interest Trust in Permitted
Investments. In the absence of written direction to the Securities Administrator
from the Majority Class X Certificateholder, all funds in the Supplemental
Interest Trust shall remain uninvested. On each Distribution Date, the
Securities Administrator shall distribute, not in respect of any REMIC, any
interest earned on the Supplemental Interest Trust to the Holders of the Class
X
Certificates.
(h) For
federal income tax purposes, amounts paid to the Supplemental Interest Trust
on
each Distribution Date pursuant to Sections 5.04(a)(i)(1), 5.04(a)(ii)(I)(A)
and
5.04(a)(ii)(II)(A) (other than any Swap Termination Payments) shall first be
deemed paid to the Supplemental Interest Trust in respect of the Class IO
Interest to the extent of the amount distributable on such Class IO Interest
on
such Distribution Date, and any remaining amount shall be deemed paid to the
Supplemental Interest Trust in respect of a Class IO Distribution Amount. For
federal income tax purposes, the Supplemental Interest Trust will be a
disregarded entity.
(i) The
Securities Administrator shall treat the Holders of Certificates (other than
the
Class P, Class X, Class R and Class R-X Certificates) as having entered into
a
notional principal contract with respect to the Holders of the Class X
Certificates. Pursuant to each such notional principal contract, all Holders
of
Certificates (other than the Class P, Class X, Class R and Class R-X
Certificates) shall be treated as having agreed to pay, on each Distribution
Date, to the Holder of the Class X Certificates an aggregate amount equal to
the
excess, if any, of (i) the amount payable on such Distribution Date on the
REMIC
III Regular Interest ownership of which is represented by such Class of
Certificates over (ii) the amount payable on such Class of Certificates on
such
Distribution Date (such excess, a “Class IO Distribution Amount”). A Class IO
Distribution Amount payable from interest collections shall be allocated pro
rata among such Certificates based on the amount of interest otherwise payable
to such Certificates, and a Class IO Distribution Amount payable from principal
collections shall be allocated to the most subordinate Class of such
Certificates with an outstanding principal balance to the extent of such
balance. In addition, pursuant to such notional principal contract, the Holder
of the Class X Certificates shall be treated as having agreed to pay Basis
Risk
Shortfalls to the Holders of the Certificates (other than the Class P, Class
X,
Class R and Class R-X Certificates) in accordance with the terms of this
Agreement. Any payments to such Certificates from amounts deemed received in
respect of this notional principal contract shall not be payments with respect
to a Regular Interest in a REMIC within the meaning of Code Section 860G(a)(1).
However, any payment from the Certificates (other than the Class P, Class X,
Class R and Class R-X Certificates) of a Class IO Distribution Amount shall
be
treated for tax purposes as having been received by the Holders of such
Certificates in respect of the REMIC III Regular Interest ownership of which
is
represented by such Certificates, and as having been paid by such Holders to
the
Supplemental Interest Trust pursuant to the notional principal contract. Thus,
each Certificate (other than the Class P Certificates, Class R Certificates
and
Class R-X Certificates) shall be treated as representing not only ownership
of a
Regular Interest in REMIC III, but also ownership of an interest in, and
obligations with respect to, a notional principal contract.
(j) The
Sponsor shall provide to the Securities Administrator the value of the right
of
the holders of the Senior and Subordinate Certificates to receive payments
from
the Supplemental Interest Trust for federal tax return and information reporting
not later than the December 31, 2007.
(k) Upon
a
Swap Early Termination (as defined in the Swap Agreement) other than in
connection with the optional termination of the Trust Fund, the Trustee will
use
reasonable efforts to appoint a successor swap provider to enter into a new
Swap
Agreement on terms substantially similar to the Swap Agreement, with a successor
swap provider meeting all applicable eligibility requirements. If the Securities
Administrator receives a Swap Termination Payment from the Swap Provider in
connection with such Swap Early Termination, the Securities Administrator will
apply such Swap Termination Payment to any upfront payment required to appoint
the successor swap provider. If the Securities Administrator is required to
pay
a Swap Termination Payment to the Swap Provider in connection with such Swap
Early Termination, the Securities Administrator will apply any upfront payment
received from the successor swap provider to pay such Swap Termination
Payment.
If
the
Trustee is unable to appoint a successor swap provider within thirty (30) days
of the Swap Early Termination, then the Securities Administrator will deposit
any Swap Termination Payment received from the original Swap Provider into
a
separate, non-interest bearing reserve account and will, on each subsequent
Distribution Date, withdraw from the amount then remaining on deposit in such
reserve account an amount equal to the Net Swap Payment, if any, that would
have
been paid to the Securities Administrator by the original Swap Provider
calculated in accordance with the terms of the original Swap Agreement, and
distribute such amount in accordance with the terms of this
Agreement.
(l) Upon
an
Interest Rate Cap Agreement Early Termination (as defined in the Interest Rate
Cap Agreement) other than in connection with the optional termination of the
trust, the Trustee will use reasonable efforts to appoint a successor interest
rate cap provider to enter into a new interest rate cap agreement on terms
substantially similar to the interest rate cap agreement, with a successor
interest rate cap provider meeting all applicable eligibility requirements.
The
Securities Administrator will apply any Interest Rate Cap Agreement Termination
Payment received from the original Interest Rate Cap Provider in connection
with
such Interest Rate Cap Agreement Early Termination to the upfront payment
required to appoint the successor interest rate cap provider.
If
the
Trustee is unable to appoint a successor interest rate cap provider within
30
days of the Interest Rate Cap Agreement Early Termination, then the Securities
Administrator will deposit any Interest Rate Cap Agreement Termination Payment
received from the original Interest Rate Cap Provider into a separate,
non-interest bearing reserve account and will, on each subsequent Distribution
Date, withdraw from the amount then remaining on deposit in such reserve account
an amount equal to the payment, if any, that would have been paid to the
Securities Administrator by the original Interest Rate Cap Provider calculated
in accordance with the terms of the original Interest Rate Cap Agreement, and
distribute such amount in accordance with the terms of the Pooling and Servicing
Agreement.
(m) In
the
event that the Swap Provider fails to perform any of its obligations under
the
Swap Agreement (including, without limitation, its obligation to make any
payment or transfer collateral), or breaches any of its representations and
warranties thereunder, or in the event that any Event of Default, Termination
Event, or Additional Termination Event (each as defined in the Swap Agreement)
occurs with respect to the Swap Agreement, the Supplemental Interest Trust
Trustee shall, promptly following actual notice of such failure, breach or
event, notify the Depositor and send any notices and make any demands, on behalf
of the Supplemental Interest Trust, required to enforce the rights of the
Supplemental Interest Trust under the Swap Agreement.
In
the
event that the Swap Provider’s obligations are guaranteed by a third party under
a guaranty relating to the Swap Agreement (such guaranty the “Swap Guaranty” and
such third party the “Swap Guarantor”), then to the extent that the Swap
Provider fails to make any payment by the close of business on the day it is
required to make payment under the terms of the Swap Agreement, the Supplemental
Interest Trust Trustee shall, promptly following actual notice of the Swap
Provider’s failure to pay, demand that the Swap Guarantor make any and all
payments then required to be made by the Swap Guarantor pursuant to such Swap
Guaranty; provided, that the Supplemental Interest Trust Trustee shall in no
event be liable for any failure or delay in the performance by the Swap Provider
or any Swap Guarantor of its obligations hereunder or pursuant to the Swap
Agreement and the Swap Guaranty, nor for any special, indirect or consequential
loss or damage of any kind whatsoever (including but not limited to lost
profits) in connection therewith.
In
the
event that the Basis Risk Cap Provider fails to perform any of its obligations
under the Basis Risk Cap Agreement (including, without limitation, its
obligation to make any payment or transfer collateral), or breaches any of
its
representations and warranties thereunder, or in the event that any Event of
Default, Termination Event, or Additional Termination Event (each as defined
in
the Basis Risk Cap Agreement) occurs with respect to the Basis Risk Cap
Agreement, the Supplemental Interest Trust Trustee shall, promptly following
actual notice of such failure, breach or event, notify the Depositor and send
any notices and make any demands, on behalf of the Supplemental Interest Trust,
required to enforce the rights of the Supplemental Interest Trust under the
Basis Risk Cap Agreement.
In
the
event that the Basis Risk Cap Provider’s obligations are guaranteed by a third
party under a guaranty relating to the Basis Risk Cap Agreement (such guaranty
the “Basis Risk Guaranty” and such third party the “Basis Risk Guarantor”), then
to the extent that the Basis Risk Cap Provider fails to make any payment by
the
close of business on the day it is required to make payment under the terms
of
the Basis Risk Cap Agreement, the Supplemental Interest Trust Trustee shall,
promptly following actual notice of the Basis Risk Cap Provider’s failure to
pay, demand that the Basis Risk Guarantor make any and all payments then
required to be made by the Basis Risk Guarantor pursuant to such Basis Risk
Guaranty; provided, that the Supplemental Interest Trust Trustee shall in no
event be liable for any failure or delay in the performance by the Basis Risk
Cap Provider or any Basis Risk Guarantor of its obligations hereunder or
pursuant to the Basis Risk Cap Agreement and the Basis Risk Guaranty, nor for
any special, indirect or consequential loss or damage of any kind whatsoever
(including but not limited to lost profits) in connection
therewith.
In
the
event that the Interest Rate Cap Provider fails to perform any of its
obligations under the Interest Rate Cap Agreement (including, without
limitation, its obligation to make any payment or transfer collateral), or
breaches any of its representations and warranties thereunder, or in the event
that any Event of Default, Termination Event, or Additional Termination Event
(each as defined in the Interest Rate Cap Agreement) occurs with respect to
the
Interest Rate Cap Agreement, the Supplemental Interest Trust Trustee shall,
promptly following actual notice of such failure, breach or event, notify the
Depositor and send any notices and make any demands, on behalf of the
Supplemental Interest Trust, required to enforce the rights of the Supplemental
Interest Trust under the Interest Rate Cap Agreement.
In
the
event that the Interest Rate Cap Provider’s obligations are guaranteed by a
third party under a guaranty relating to the Interest Rate Cap Agreement (such
guaranty the “Interest Rate Cap Guaranty” and such third party the “Interest
Rate Cap Guarantor”), then to the extent that the Interest Rate Cap Provider
fails to make any payment by the close of business on the day it is required
to
make payment under the terms of the Interest Rate Cap Agreement, the
Supplemental Interest Trust Trustee shall, promptly following actual notice
of
the Interest Rate Cap Provider’s failure to pay, demand that the Interest Rate
Cap Guarantor make any and all payments then required to be made by the Interest
Rate Cap Guarantor pursuant to such Interest Rate Cap Guaranty; provided, that
the Supplemental Interest Trust Trustee shall in no event be liable for any
failure or delay in the performance by the Interest Rate Cap Provider or any
Interest Rate Cap Guarantor of its obligations hereunder or pursuant to the
Interest Rate Cap Agreement and the Interest Rate Cap Guaranty, nor for any
special, indirect or consequential loss or damage of any kind whatsoever
(including but not limited to lost profits) in connection
therewith.
Section
5.13 Tax
Treatment of Swap Payments and Swap Termination Payments.
For
federal income tax purposes, each holder of a Senior Certificate or Subordinate
Certificate is deemed to own an undivided beneficial ownership interest in
a
REMIC regular interest and the right to receive payments from either the Basis
Risk Shortfall Reserve Fund or the Supplemental Interest Trust in respect of
any
Basis Risk Shortfalls or the obligation to make payments to the Supplemental
Interest Trust. For federal income tax purposes, the Securities Administrator
will account for payments to each Senior Certificate and Subordinate Certificate
as follows: each Senior Certificate and Subordinate Certificate will be treated
as receiving their entire payment from REMIC III (regardless of any Swap
Termination Payment or obligation under the Swap Agreement) and subsequently
paying their portion of any Swap Termination Payment in respect of each such
Class’ obligation under the Swap Agreement. In the event that any such Class is
resecuritized in a REMIC, the obligation under the Swap Agreement to pay any
such Swap Termination Payment (or any shortfall in Net Swap Payment), will
be
made by one or more of the REMIC Regular Interests issued by the
resecuritization REMIC subsequent to such REMIC Regular Interest receiving
its
full payment from any such Senior Certificate and Subordinate Certificate.
Resecuritization of any Senior Certificate and Subordinate Certificate in a
REMIC will be permissible only if the Securities Administrator hereunder is
the
trustee/securities administrator in such resecuritization.
The
REMIC
Regular Interest corresponding to a Senior Certificate and Subordinate
Certificate will be entitled to receive interest and principal payments at
the
times and in the amounts equal to those made on the certificate to which it
corresponds, except that (i) the maximum interest rate of that REMIC regular
interest will equal the Net Funds Cap computed for this purpose by limiting
the
Notional Amount of the Swap Agreement to the aggregate Stated Principal Balance
of the Mortgage Loans and (ii) any Swap Termination Payment will be treated
as
being payable solely from amounts otherwise payable to the Class X Certificates.
As a result of the foregoing, the amount of distributions and taxable income
on
the REMIC Regular Interest corresponding to a Senior Certificate and Subordinate
Certificate may exceed the actual amount of distributions on the Senior
Certificate and Subordinate Certificate.
Section
5.14 Reports
Filed with Securities and Exchange Commission.
(a) (i) For
so
long as the Trust Fund is subject to Exchange Act reporting requirements, within
fifteen (15) days after each Distribution Date (subject to permitted extensions
under the Exchange Act), the Securities Administrator shall prepare and file
on
behalf of the Trust Fund any Form 10-D required by the Exchange Act, in form
and
substance as required by the Exchange Act. The Securities Administrator shall
file each Form 10-D with a copy of the related Monthly Statement attached
thereto. Any disclosure in addition to the Monthly Statement that is required
to
be included on Form 10-D (“Additional
Form 10-D Disclosure”)
shall
be reported to the Depositor and the Securities Administrator by the entity
indicated on Exhibit N and approved by the Depositor pursuant to the following
paragraph. The Securities Administrator will have no duty or liability for
any
failure hereunder to determine or prepare any Additional Form 10-D Disclosure,
except as set forth in the next paragraph.
(ii) As
set
forth on Exhibit N hereto, within five (5) calendar days after the related
Distribution Date, (i) each Transaction Party shall be required to provide
to
the Securities Administrator and to the Depositor, to the extent known by a
responsible officer thereof, in XXXXX-compatible form, or in such other form
as
otherwise agreed upon by the Securities Administrator and such party, the form
and substance of any Additional Form 10-D Disclosure, if applicable, together
with an Additional Disclosure Notification in the form of Exhibit H hereto
(an
“Additional
Disclosure Notification”)
and
(ii) the Depositor will approve, as to form and substance, or disapprove, as
the
case may be, the inclusion of the Additional Form 10-D Disclosure on Form 10-D.
The Depositor will be responsible for any reasonable fees and expenses assessed
or incurred by the Securities Administrator in connection with including any
Additional Form 10-D Disclosure on Form 10-D pursuant to this paragraph.
(iii) After
preparing the Form 10-D, the Securities Administrator shall forward
electronically a copy of the Form 10-D to the Depositor (provided that such
Form
10-D includes any Additional Form 10-D Disclosure). Within two (2) Business
Days
after receipt of such copy, but no later than the twelfth (12th) calendar day
after the Distribution Date, the Depositor shall notify the Securities
Administrator in writing (which may be furnished electronically) of any changes
to or approval of such Form 10-D. In the absence of receipt of any written
changes or approval, the Securities Administrator shall be entitled to assume
that such Form 10-D is in final form and the Securities Administrator may
proceed with the execution and filing of the Form 10-D. A duly authorized
representative of the Master Servicer shall sign each Form 10-D. If a Form
10-D
cannot be filed on time or if a previously filed Form 10-D needs to be amended,
the Securities Administrator will follow the procedures set forth in Section
5.14(d)(ii). Promptly (but no later than one (1) Business Day) after filing
with
the Commission, the Securities Administrator will make available on its internet
website a final executed copy of each Form 10-D filed by the Securities
Administrator. Each party to this Agreement acknowledges that the performance
by
the Master Servicer and the Securities Administrator of its duties under this
Section 5.14(a) related to the timely preparation, execution and filing of
Form
10-D is contingent upon such parties strictly observing all applicable deadlines
in the performance of their duties as set forth in this Agreement. Neither
the
Master Servicer nor the Securities Administrator shall have any liability for
any loss, expense, damage, claim arising out of or with respect to any failure
to properly prepare, execute and/or timely file such Form 10-D, where such
failure results from the Securities Administrator’s inability or failure to
obtain or receive, on a timely basis, any information from any other party
hereto needed to prepare, arrange for execution or file such Form 10-D, not
resulting from its own negligence, bad faith or willful misconduct.
(b) Each
of
Form 10-D and Form 10-K requires the registrant to indicate (by checking “yes”
or “no”) that it “(1) has filed all reports required to be filed by Section 13
or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has
been
subject to such filing requirements for the past 90 days.” The Depositor hereby
represents to the Securities Administrator as of the date hereof that the
Depositor has (1) filed all such required reports that (a) the Depositor has
undertaken to file on its own behalf or (b) relate to other securitization
transactions of the Depositor for which Xxxxx Fargo Bank, National Association,
in its capacity as Securities Administrator or similar capacity, does not have
the exclusive obligation to prepare and file during the preceding 12 months;
provided, however, that the Depositor shall not be obligated to make such
representation with respect to any filings made by the Securities Administrator
on behalf of the Depositor, and (2) that it has been subject to such filing
requirement for the past 90 days. The Depositor shall notify the Securities
Administrator in writing, no later than the fifth calendar day after the related
Distribution Date with respect to the filing of a report on Form 10-D and no
later than March 15th with respect to the filing of a report on Form 10-K,
if
the answer to the questions should be “no”. The Securities Administrator shall
be entitled to rely on such representations in preparing, executing and/or
filing any such report.
(c) (i) For
so
long as the Trust Fund is subject to Exchange Act reporting requirements, within
four (4) Business Days after the occurrence of an event set forth on Exhibit
N
hereto under the caption “Form 8-K Disclosure Information” or such other event
requiring disclosure on Form 8-K (each such event, a “Reportable
Event”),
or if
requested by the Depositor, and subject to receipt of such information by the
Securities Administrator from the entity indicated on Exhibit N as the
responsible party for providing that information, the Securities Administrator
shall prepare and file on behalf of the Trust Fund any Form 8-K, as required
by
the Exchange Act, provided
that the
Depositor shall file the initial Form 8-K in connection with the issuance of
the
Certificates. Any disclosure or information related to a Reportable Event or
that is otherwise required to be included on Form 8-K other than the initial
Form 8-K (“Form
8-K Disclosure Information”)
shall
be reported by the parties set forth on Exhibit
N
to the
Depositor and the Securities Administrator and directed and approved by the
Depositor pursuant to the following paragraph, and the Securities Administrator
will have no duty or liability for any failure hereunder to determine or prepare
any Form 8-K Disclosure Information or any Form 8-K, except as set forth in
the
next paragraph.
(ii) As
set
forth on Exhibit N hereto, for so long as the Trust Fund is subject to Exchange
Act reporting requirements, no later than the close of business (New York City
time) on the second (2nd) Business Day after the occurrence of a Reportable
Event (i) the Transaction Parties shall be required to provide to the Securities
Administrator and to the Depositor, to the extent known by a responsible officer
thereof, in XXXXX-compatible form, or in such other form as otherwise agreed
upon by the Securities Administrator and such party, the form and substance
of
any Form 8-K Disclosure Information, if applicable, together with an Additional
Disclosure Notification and (ii) the Depositor will approve, as to form and
substance, or disapprove, as the case may be, the inclusion of the Form 8-K
Disclosure Information. The Depositor will be responsible for any reasonable
fees and expenses assessed or incurred by the Securities Administrator in
connection with including any Form 8-K Disclosure Information on Form 8-K
pursuant to this paragraph.
(iii) After
preparing the Form 8-K, the Securities Administrator shall forward
electronically a copy of the Form 8-K to the Depositor. Promptly, but no later
than the close of business on the third (3rd) Business Day after the Reportable
Event, the Depositor shall notify the Securities Administrator in writing (which
may be furnished electronically) of any changes to or approval of such Form
8-K.
In the absence of receipt of any written changes or approval, the Securities
Administrator shall be entitled to assume that such Form 8-K is in final form
and the Securities Administrator may proceed with the execution and filing
of
the Form 8-K. A duly authorized representative of the Master Servicer shall
sign
each Form 8-K. If a Form 8-K cannot be filed on time or if a previously filed
Form 8-K needs to be amended, the Securities Administrator will follow the
procedures set forth in Section 5.14(d)(ii). Promptly (but no later than 1
Business Day) after filing with the Commission, the Securities Administrator
will make available on its internet website a final executed copy of each Form
8-K that it has filed. The parties to this Agreement acknowledge that the
performance by the Master Servicer and the Securities Administrator of its
duties under this Section 5.14(c) related to the timely preparation, execution
and filing of Form 8-K is contingent upon such parties strictly observing all
applicable deadlines in the performance of their duties under this Agreement.
Neither the Master Servicer nor the Securities Administrator shall have any
liability for any loss, expense, damage, claim arising out of or with respect
to
any failure to properly prepare, execute and/or timely file such Form 8-K,
where
such failure results from the Securities Administrator’s inability or failure to
obtain or receive, on a timely basis, any information from any other party
hereto needed to prepare, arrange for execution or file such Form 8-K, not
resulting from its own negligence, bad faith or willful misconduct.
(d) (i) On
or
prior to January 30 of the first year in which the Securities Administrator
is
able to do so under applicable law, the Securities Administrator shall prepare
and file a Form 15 Suspension Notification relating to the automatic suspension
of reporting in respect of the Trust Fund under the Exchange Act.
(ii) In
the
event that the Securities Administrator is unable to timely file with the
Commission all or any required portion of any Form 8-K, 10-D or 10-K required
to
be filed by this Agreement because required disclosure information was either
not delivered to it or delivered to it after the delivery deadlines set forth
in
this Agreement or for any other reason, the Securities Administrator will
promptly notify electronically the Depositor. In the case of Form 10-D and
10-K,
the parties to this Agreement will cooperate to prepare and file a Form 12b-25
and a 10-D/A and 10-K/A as applicable, pursuant to Rule 12b-25 of the Exchange
Act. In the case of Form 8-K, the Securities Administrator will, upon receipt
of
all required Form 8-K Disclosure Information and upon the approval and direction
of the Depositor, include such disclosure information on the next Form 10-D.
In
the event that any previously filed Form 8-K, 10-D or 10-K needs to be amended
in connection with any Additional Form 10-D Disclosure (other than for the
purpose of restating any monthly report), Additional Form 10-K Disclosure or
Form 8-K Disclosure Information, the Securities Administrator will
electronically notify the Depositor and such other parties to the transaction
as
are affected by such amendment, and such parties will cooperate to prepare
any
necessary 8-K/A, 10-D/A or 10-K/A. Any Form 15, Form 12b-25 or any amendment
to
Form 8-K, 10-D or 10-K shall be signed by a duly authorized representative,
or
senior officer in charge of master servicing, as applicable, of the Master
Servicer. The parties to this Agreement acknowledge that the performance by
the
Master Servicer and the Securities Administrator of its duties under this
Section 5.14(c) related to the timely preparation, execution and filing of
Form
15, a Form 12b-25 or any amendment to Form 8-K, 10-D or 10-K is contingent
upon
each such party performing its duties under this Section. Neither the Master
Servicer nor the Securities Administrator shall have any liability for any
loss,
expense, damage, claim arising out of or with respect to any failure to properly
prepare, execute and/or timely file any such Form 15, Form 12b-25 or any
amendments to Forms 8-K, 10-D or 10-K, where such failure results from the
Securities Administrator’s inability or failure to obtain or receive, on a
timely basis, any information from any other party hereto needed to prepare,
arrange for execution or file such Form 15, Form 12b-25 or any amendments to
Forms 8-K, 10-D or 10-K, not resulting from its own negligence, bad faith or
willful misconduct.
(e) (i) For
so
long as the Trust Fund is subject to Exchange Act reporting requirements, within
ninety (90) days after the end of each calendar year or such earlier date as
may
be required by the Exchange Act (the “10-K
Filing Deadline”),
(it
being understood that the fiscal year for the Trust Fund ends on December 31
of
each year) commencing in March 2008, the Securities Administrator shall prepare
and file on behalf of the Trust a Form 10-K, in form and substance as required
by the Exchange Act. Each such Form 10-K shall include the following items,
in
each case to the extent they have been delivered to the Securities Administrator
within the applicable time frames set forth in this Agreement, (i) the annual
statements of compliance as described under Section 3.13 and the Custodial
Agreement, (ii)(A) the annual reports on assessment of compliance with servicing
criteria for each Reporting Party, as described under Section 3.14 and the
Custodial Agreement, and (B) if any Reporting Party’s report on assessment of
compliance with servicing criteria described under Section 3.14 identifies
any
material instance of noncompliance, disclosure identifying such instance of
noncompliance, or if any Servicing Function Participant’s report on assessment
of compliance with servicing criteria described under Section 3.14 is not
included as an exhibit to such Form 10-K, disclosure that such report is not
included and an explanation why such report is not included, (iii)(A) the
registered public accounting firm attestation report for each Servicing Function
Participant, as described under Section 3.14 and the Custodial Agreement, and
(B) if any registered public accounting firm attestation report described under
Section 3.14 identifies any material instance of noncompliance, disclosure
identifying such instance of noncompliance, or if any such registered public
accounting firm attestation report is not included as an exhibit to such Form
10-K, disclosure that such report is not included and an explanation why such
report is not included, and (iv) a Xxxxxxxx-Xxxxx Certification as described
in
Section 3.18. Any disclosure or information in addition to (i) through (iv)
above that is required to be included on Form 10-K as set forth on Exhibit
N
under Form 10-K (“Additional
Form 10-K Disclosure”)
shall
be reported to the Depositor and the Securities Administrator by the parties
set
forth on Exhibit N, and shall be approved by the Depositor pursuant to the
following paragraph. The Securities Administrator will have no duty or liability
for any failure hereunder to determine or prepare any Additional Form 10-K
Disclosure, except as set forth in the next paragraph.
(ii) As
set
forth on Exhibit N hereto, no later than March 15 of each year that the Trust
Fund is subject to the Exchange Act reporting requirements, commencing in 2008,
(i) each Transaction Party shall be required to provide to the Securities
Administrator and to the Depositor, to the extent known by a responsible officer
thereof, in XXXXX-compatible form, or in such other form as otherwise agreed
upon by the Securities Administrator and such party, the form and substance
of
any Additional Form 10-K Disclosure, if applicable, together with an Additional
Disclosure Notification and (ii) the Depositor will approve, as to form and
substance, or disapprove, as the case may be, the inclusion of the Additional
Form 10-K Disclosure on Form 10-K. The Depositor will be responsible for any
reasonable fees and expenses assessed or incurred by the Securities
Administrator in connection with including any Additional Form 10-K Disclosure
on Form 10-K pursuant to this paragraph.
(iii) After
preparing the Form 10-K, the Securities Administrator shall forward
electronically a copy of the Form 10-K to the Depositor. Within three (3)
Business Days after receipt of such copy, but no later than March 25th, the
Depositor shall notify the Securities Administrator in writing (which may be
furnished electronically) of any changes to or approval of such Form 10-K.
In
the absence of receipt of any written changes or approval, the Securities
Administrator shall be entitled to assume that such Form 10-K is in final form
and the Securities Administrator may proceed with the execution and filing
of
the Form 10-K. A senior officer of the Master Servicer in charge of the master
servicing function shall sign the Form 10-K. If a Form 10-K cannot be filed
on
time or if a previously filed Form 10-K needs to be amended, the Securities
Administrator will follow the procedures set forth in Section 5.14(d)(ii).
Promptly (but no later than one (1) Business Day) after filing with the
Commission, the Securities Administrator will make available on its internet
website a final executed copy of each Form 10-K to be filed by the Securities
Administrator. The parties to this Agreement acknowledge that the performance
by
the Master Servicer and the Securities Administrator of its duties under this
Section 5.14(e) related to the timely preparation, execution and filing of
Form
10-K is contingent upon such parties (and any Servicing Function Participant)
strictly observing all applicable deadlines in the performance of their duties
under this Section 5.14(e), Section 3.13, Section 3.14 and Section 3.18. Neither
the Master Servicer nor the Securities Administrator shall have any liability
for any loss, expense, damage or claim arising out of or with respect to any
failure to properly prepare and/or timely file such Form 10-K, where such
failure results from the Securities Administrator’s inability or failure to
obtain or receive, on a timely basis, any information from any other party
hereto needed to prepare, arrange for execution or file such Form 10-K, not
resulting from its own negligence, bad faith or willful misconduct.
(f) The
Servicers, the Master Servicer, the Depositor, the Custodian, the Sponsor and
Securities Administrator shall indemnify and hold harmless the Depositor, the
Trustee and their respective officers, directors and Affiliates from and against
any losses, damages, penalties, fines, forfeitures, reasonable and necessary
legal fees and related costs, judgments and other costs and expenses arising
out
of or based upon a breach of such party’s obligations under this Section 5.14 or
such party’s negligence, bad faith or willful misconduct in connection
therewith.
(g) Any
notice required to be delivered by the Securities Administrator to the Depositor
pursuant to this Section 5.14 or Sections 3.13, 3.14 or 3.18 shall be delivered
by the Securities Administrator by facsimile and electronic mail to Xxxxxx
Xxxx,
Esq. at (000) 000-0000 and ,
with a
copy to Xxxx Xxxxxx at (000) 000-0000 and and
a
copy to N. Xxxxx XxXxxxx at (000) 000-0000 and .
(h) Notwithstanding
the provisions of Section 11.01, this Section 5.14 may be amended without the
consent of the Certificateholders.
Section
5.15 Derivatives
Collateral Account
The
Securities Administrator is hereby directed to perform the obligations of the
Custodian as defined under each of the Derivatives Agreements (the “Derivatives
Custodian”).
On
or
after the Closing Date, the Derivatives Custodian shall establish a Derivatives
Collateral Account (the “Derivatives Collateral Account”). The Derivatives
Collateral Account shall be held in the name of the Derivatives Custodian in
trust for the benefit of the Holders of the Asset-Backed Certificates, Series
2007-2. The Derivatives Collateral Account must be an Eligible Account and
shall
be entitled “Nomura Home Equity Loan, Inc., Home Equity Loan Trust, Series
2007-2, Asset-Backed Certificates, Series 2007-2, Derivatives Collateral
Account, Securities Administrator, as Derivatives Custodian for the benefit
of
holders of Asset-Backed Certificates, Series 2007-2.”
The
Derivatives Custodian shall credit to the Derivatives Collateral Account all
collateral (whether in the form of cash or securities) posted by the Derivatives
Provider to secure the obligations of the Derivatives Provider in accordance
with the terms of the related Derivatives Agreement. Except for investment
earnings, the Derivatives Provider shall not have any legal, equitable or
beneficial interest in the Derivatives Collateral Account other than in
accordance with this Agreement, the Swap Agreement, the Basis Risk Cap
Agreement, the Interest Rate Cap Agreement, and applicable law. The Derivatives
Custodian shall maintain and apply all collateral and earnings thereon on
deposit in the Derivatives Collateral Account in accordance with related
Derivatives Credit Support Annex.
Cash
collateral posted by the Derivatives Provider in accordance with the related
Derivatives Credit Support Annex shall be invested at the direction of the
Derivatives Provider in Permitted Investments in accordance with the
requirements of the related Derivatives Credit Support Annex. In the absence
of
such direction, such amounts shall remain uninvested. All amounts earned on
amounts on deposit in the Derivatives Collateral Account (whether cash
collateral or securities) shall be for the account of and taxable to the
Derivatives Provider.
Upon
the
occurrence of an Event of Default or Specified Condition (each as defined in
the
related Derivatives Agreement) with respect to a Derivatives Provider or upon
occurrence or designation of an Early Termination Date (as defined in the
related Derivatives Agreement) as a result of any such Event of Default or
Specified Condition with respect to such Derivatives Provider, and, in either
such case, unless such Derivatives Provider has paid in full all of its
Obligations (as defined in the related Derivatives Credit Support Annex) that
are then due, then any collateral posted by the Derivatives Provider in
accordance with the related Derivatives Credit Support Annex shall be applied
to
the payment of any Obligations due to Party B (as defined in the related
Derivatives Agreement) in accordance with the related Derivatives Credit Support
Annex. Any excess amounts held in such Derivatives Collateral Account after
payment of all amounts owing to Party B under the related Derivatives Agreement
shall be withdrawn from the Derivatives Collateral Account and paid to the
related Derivatives Provider in accordance with the related Derivatives Credit
Support Annex.
ARTICLE
VI
THE
CERTIFICATES
Section
6.01 The
Certificates.
(a) The
Certificates shall be substantially in the forms attached hereto as Exhibits
A-1
through A-6. The Certificates shall be issuable in registered form, in the
minimum dollar denominations, integral dollar multiples in excess thereof
(except that one Certificate of each Class may be issued in a different amount
which must be in excess of the applicable minimum dollar denomination) and
aggregate dollar denominations as set forth in the following table:
|
Class
|
Minimum
Denomination
|
Integral
Multiple in Excess of Minimum
|
Original
Certificate Principal Balance
|
Pass-Through
Rate
|
|||||
|
I-A-1
|
$25,000
|
$1
|
$358,847,000.00
|
Class
I-A-1 Pass-Through Rate
|
|||||
|
II-A-1
|
$25,000
|
$1
|
$220,764,000.00
|
Class
II-A-1 Pass-Through Rate
|
|||||
|
II-A-2
|
$25,000
|
$1
|
$26,333,000.00
|
Class
II-A-2 Pass-Through Rate
|
|||||
|
II-A-3
|
$25,000
|
$1
|
$65,731,000.00
|
Class
II-A-3 Pass-Through Rate
|
|||||
|
II-A-4
|
$25,000
|
$1
|
$21,643,000.00
|
Class
II-A-4 Pass-Through Rate
|
|||||
|
M-1
|
$25,000
|
$1
|
$39,551,000.00
|
Class
M-1 Pass-Through Rate
|
|||||
|
M-2
|
$25,000
|
$1
|
$35,829,000.00
|
Class
M-2 Pass-Through Rate
|
|||||
|
M-3
|
$25,000
|
$1
|
$21,869,000.00
|
Class
M-3 Pass-Through Rate
|
|||||
|
M-4
|
$25,000
|
$1
|
$19,543,000.00
|
Class
M-4 Pass-Through Rate
|
|||||
|
M-5
|
$25,000
|
$1
|
$17,681,000.00
|
Class
M-5 Pass-Through Rate
|
|||||
|
M-6
|
$25,000
|
$1
|
$15,820,000.00
|
Class
M-6 Pass-Through Rate
|
|||||
|
M-7
|
$25,000
|
$1
|
$14,424,000.00
|
Class
M-7 Pass-Through Rate
|
|||||
|
M-8
|
$25,000
|
$1
|
$13,494,000.00
|
Class
M-8 Pass-Through Rate
|
|||||
|
M-9
|
$25,000
|
$1
|
$11,167,000.00
|
Class
M-9 Pass-Through Rate
|
|||||
|
B-1
|
$25,000
|
$1
|
$13,028,000.00
|
Class
B-1 Pass-Through Rate
|
|||||
|
X
|
$1
|
$1
|
$34,904,228.95
|
Class
X Pass-Through Rate
|
|||||
|
P
|
$1
|
$1
|
$ |
100.00
|
X/X
|
||||
|
X
|
X/X
|
X/X
|
X/X
|
X/X
|
|||||
|
R-X
|
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Upon
original issue, the Certificates shall be executed and authenticated by the
Securities Administrator and delivered by the Trustee to and upon the written
order of the Depositor. The Certificates shall be executed by manual or
facsimile signature on behalf of the Trust by the Securities Administrator
by an
authorized signatory. Certificates bearing the manual or facsimile signatures
of
individuals who were at any time the proper officers of the Securities
Administrator shall bind the Trust, notwithstanding that such individuals or
any
of them have ceased to hold such offices prior to the authentication and
delivery of such Certificates or did not hold such offices at the date of such
Certificates. No Certificate shall be entitled to any benefit under this
Agreement or be valid for any purpose, unless there appears on such Certificate
a certificate of authentication substantially in the form provided herein
executed by the Securities Administrator by manual signature, and such
certificate of authentication 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.
The
Depositor shall provide, or cause to be provided, to the Securities
Administrator on a continuous basis, an adequate inventory of Certificates
to
facilitate transfers.
(b) The
Class
X Certificates and Class P Certificates offered and sold to Qualified
Institutional Buyers in reliance on Rule 144A under the Securities Act (“Rule
144A”) will be issued in the form of Definitive Certificates. The Residual
Certificates will be issued in the form of Definitive Certificates.
Section
6.02 Certificate
Register; Registration of Transfer and Exchange of Certificates.
(a) The
Securities Administrator shall maintain, or cause to be maintained in accordance
with the provisions of Section 6.09, a Certificate Register for the
Certificates in which, subject to the provisions of subsections (b) and (c)
below and to such reasonable regulations as it may prescribe, the Securities
Administrator shall provide for the registration of Certificates and of
Transfers and exchanges of Certificates as herein provided. Upon surrender
for
registration of Transfer of any Certificate, the Securities Administrator shall
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Certificates of the same Class and of like
aggregate Percentage Interest.
At
the
option of a Certificateholder, Certificates may be exchanged for other
Certificates of the same Class in authorized denominations and evidencing the
same aggregate Percentage Interest upon surrender of the Certificates to be
exchanged at the office or agency of the Securities Administrator. Whenever
any
Certificates are so surrendered for exchange, the Securities Administrator
shall
execute, authenticate, and deliver the Certificates that the Certificateholder
making the exchange is entitled to receive. Every Certificate presented or
surrendered for registration of Transfer or exchange shall be accompanied by
a
written instrument of Transfer in form satisfactory to the Securities
Administrator duly executed by the holder thereof or his attorney duly
authorized in writing.
No
service charge to the Certificateholders shall be made for any registration
of
Transfer or exchange of Certificates, but payment of a sum sufficient to cover
any tax or governmental charge that may be imposed in connection with any
Transfer or exchange of Certificates may be required.
All
Certificates surrendered for registration of Transfer or exchange shall be
canceled and subsequently destroyed by the Securities Administrator in
accordance with the Securities Administrator’s customary
procedures.
(b) No
Transfer of a Private Certificate shall be made unless such Transfer is made
pursuant to an effective registration statement under the Securities Act and
any
applicable state securities laws or is exempt from the registration requirements
under the Securities Act and such state securities laws. In the event that
a
Transfer is to be made in reliance upon an exemption from the Securities Act
and
such laws, in order to assure compliance with the Securities Act and such laws,
the Certificateholder desiring to effect such Transfer and such
Certificateholder’s prospective transferee shall each certify to the Securities
Administrator in writing the facts surrounding the Transfer in substantially
the
forms set forth in Exhibit E (the “Transferor Certificate”) and (x) deliver a
letter in substantially the form of either Exhibit F (the “Investment Letter”)
or Exhibit G (the “Rule 144A Letter”) or (y) there shall be delivered to the
Securities Administrator an Opinion of Counsel, at the expense of the
transferor, that such Transfer may be made pursuant to an exemption from the
Securities Act, which Opinion of Counsel shall not be an expense of the
Depositor, the Sponsor, the Securities Administrator, the Trustee or the Trust
Fund. The Depositor shall provide to any Holder of a Private Certificate and
any
prospective transferee designated by any such Holder, information regarding
the
related Certificates and the Mortgage Loans and such other information as shall
be necessary to satisfy the condition to eligibility set forth in Rule
144A(d)(4) for Transfer of any such Certificate without registration thereof
under the Securities Act pursuant to the registration exemption provided by
Rule
144A. The Securities Administrator shall cooperate with the Depositor in
providing the Rule 144A information referenced in the preceding sentence,
including providing to the Depositor such information regarding the
Certificates, the Mortgage Loans and other matters regarding the Trust Fund
as
the Depositor shall reasonably request to meet its obligation under the
preceding sentence. Each Holder of a Private Certificate desiring to effect
such
Transfer shall, and does hereby agree to, indemnify the Securities
Administrator, the Depositor and the Sponsor against any liability that may
result if the Transfer is not so exempt or is not made in accordance with such
federal and state laws.
If
any
such transfer of a Class B-1 Certificate held by the related transferor and
also
to be held by the related transferee in the form of a Book-Entry Certificate
is
to be made without registration under the Securities Act, the transferor will
be
deemed to have made as of the transfer date each of the representations and
warranties set forth on Exhibit E hereto in respect of such Class B-1
Certificate and the transferee will be deemed to have made as of the transfer
date each of the representations and warranties set forth on Exhibit F or
Exhibit G hereto in respect of such Class B-1 Certificate.
No
transfer of any Class B-1 Certificate that is a Book-Entry Certificate or
interest therein shall be made by any related Certificate Owner except (A)
in
the manner set forth in the preceding paragraph and in reliance on Rule 144A
under the 1933 Act to a “qualified institutional buyer” that is acquiring such
Book-Entry Certificate for its own account or for the account of another
“qualified institutional buyer” or (B) in the manner set forth in the second
preceding paragraph and in the form of a Definitive Certificate.
If
any
Certificate Owner that is required under this Section 6.02(b) to transfer its
Book-Entry Certificates in the form of Definitive Certificates, (i) notifies
the
Securities Administrator of such transfer or exchange and (ii) transfers such
Book-Entry Certificates to the Securities Administrator, in its capacity as
such, through the book-entry facilities of the Depository, then the Securities
Administrator shall decrease the balance of such Book-Entry Certificates or,
the
Securities Administrator shall use reasonable efforts to cause the surrender
to
the Certificate Registrar of such Book-Entry Certificates by the Depository,
and
thereupon, the Securities Administrator shall execute, authenticate and deliver
to such Certificate Owner or its designee one or more Definitive Certificates
in
authorized denominations and with a like aggregate principal
amount.
Subject
to the provisions of this Section 6.02(b) governing registration of transfer
and
exchange, Class B-1 Certificates (i) held as Definitive Certificates may be
transferred in the form of Book-Entry Certificates in reliance on Rule 144A
under the 1933 Act to one or more “qualified institutional buyers” that are
acquiring such Definitive Certificates for their own accounts or for the
accounts of other “qualified institutional buyers” and (ii) held as Definitive
Certificates by a “qualified institutional buyer” for its own account or for the
account of another “qualified institutional buyer” may be exchanged for
Book-Entry Certificates, in each case upon surrender of such Class B-1
Certificates for registration of transfer or exchange at the offices of the
Securities Administrator maintained for such purpose. Whenever any such Class
B-1 Certificates are so surrendered for transfer or exchange, either the
Securities Administrator shall increase the balance of the related Book-Entry
Certificates or the Securities Administrator shall execute, authenticate and
deliver the Book-Entry Certificates for which such Class B-1 Certificates were
transferred or exchanged, as necessary and appropriate. No Holder of Definitive
Certificates other than a “qualified institutional buyer” holding such
Certificates for its own account or for the account of another “qualified
institutional buyer” may exchange such Class B-1 Certificates for Book-Entry
Certificates. Further, any Certificate Owner of a Book-Entry Certificate other
than any such “qualified institutional buyers” shall notify the Securities
Administrator of its status as such and shall transfer such Book-Entry
Certificate to the Securities Administrator, through the book-entry facilities
of the Depository, whereupon, and also upon surrender to the Securities
Administrator of such Book-Entry Certificate by the Depository, (which surrender
the Securities Administrator shall use reasonable efforts to cause to occur),
the Securities Administrator shall execute, authenticate and deliver to such
Certificate Owner or such Certificate Owner’s nominee one or more Definitive
Certificates in authorized denominations and with a like aggregate principal
amount.
No
Transfer of an ERISA Restricted Certificate shall be made unless the Securities
Administrator shall have received either (i) a representation from the
transferee of such Certificate acceptable to and in form and substance
satisfactory to the Securities Administrator to the effect that such transferee
is not an employee benefit plan subject to Section 406 of ERISA and/or a
plan subject to Section 4975 of the Code, or a Person acting on behalf of
any such plan or using the assets of any such plan, or (ii) in the case of
any
such ERISA Restricted Certificate presented for registration in the name of
an
employee benefit plan subject to ERISA, or a plan subject to Section 4975
of the Code (or comparable provisions of any subsequent enactments), or a
trustee of any such plan or any other person acting on behalf of any such plan,
an Opinion of Counsel satisfactory to the Securities Administrator for the
benefit of the Securities Administrator, the Depositor and the Servicer and
on
which they may rely to the effect that the purchase and holding of such ERISA
Restricted Certificate is permissible under applicable law, will not result
in
any prohibited transactions under ERISA or Section 4975 of the Code and
will not subject the Securities Administrator, the Depositor, the Trustee or
the
Servicer to any obligation in addition to those expressly undertaken in this
Agreement, which Opinion of Counsel shall not be an expense of the Securities
Administrator, the Depositor, the Servicer or the Trustee. Notwithstanding
anything else to the contrary herein, any purported transfer of an ERISA
Restricted Certificate to or on behalf of an employee benefit plan subject
to
Section 406 of ERISA and/or a plan subject to Section 4975 of the Code
other than in compliance with the foregoing shall be void and of no effect;
provided that the restriction set forth in this sentence shall not be applicable
if there has been delivered to the Securities Administrator an Opinion of
Counsel meeting the requirements of clause (ii) of the first sentence of this
paragraph. The Securities Administrator shall not be under any liability to
any
Person for any registration of transfer of any ERISA Restricted Certificate
that
is in fact not permitted by this Section 6.02(b) or for making any payments
due on such Certificate to the Holder thereof or taking any other action with
respect to such Holder under the provisions of this Agreement. The Securities
Administrator shall be entitled, but not obligated, to recover from any Holder
of any ERISA Restricted Certificate that was in fact an employee benefit plan
subject to Section 406 of ERISA or a plan subject to Section 4975 of
the Code or a Person acting on behalf of any such plan at the time it became
a
Holder or, at such subsequent time as it became such a plan or Person acting
on
behalf of such a plan, all payments made on such ERISA Restricted Certificate
at
and after either such time. Any such payments so recovered by the Securities
Administrator shall be paid and delivered by the Securities Administrator to
the
last preceding Holder of such Certificate that is not such a plan or Person
acting on behalf of a plan.
For
so
long as the Supplemental Interest Trust is in existence, each beneficial owner
of a Publicly Offered Certificate, Class B-1 Certificate or any interest
therein, shall be deemed to have represented, by virtue of its acquisition
or
holding of the Publicly Offered Certificate, Class B-1 Certificate or interest
therein, that either (i) it is not a Plan or (ii)(A) it is an accredited
investor within the meaning of Prohibited Transaction Exemption 2002-41, as
amended from time to time (the “Exemption”) and (B) the acquisition and holding
of such Certificate and the separate right to receive payments from the
Supplemental Interest Trust are eligible for the exemptive relief available
under Prohibited Transaction Class Exemption (“PTCE”) 84-14 (for transactions by
independent “qualified professional asset managers”), 91-38 (for transactions by
bank collective investment funds), 90-1 (for transactions by insurance company
pooled separate accounts), 95-60 (for transactions by insurance company general
accounts) or 96-23 (for transactions effected by “in-house asset managers”) in
the case of a Publicly Offered Certificate or a Class B-1
Certificate.
Each
beneficial owner of a Subordinate Certificate or any interest therein that
is
acquired after the termination of the Supplemental Interest Trust shall be
deemed to have represented, by virtue of its acquisition or holding of that
certificate or interest therein, that either (i) it is not a Plan or investing
with “Plan Assets”, (ii) it has acquired and is holding such certificate in
reliance on the Exemption, and that it understands that there are certain
conditions to the availability of the Exemption, including that the certificate
must be rated, at the time of purchase, not lower than “BBB-“ (or its
equivalent) by S&P, Fitch Ratings or Xxxxx’x, and the certificate is so
rated or (iii) (1) it is an insurance company, (2) the source of funds used
to
acquire or hold the certificate or interest therein is an “insurance company
general account,” as such term is defined in Prohibited Transaction Class
Exemption (“PTCE”) 95-60 and (3) the conditions in Sections I and III of PTCE
95-60 have been satisfied.
If
any
Certificate, or any interest therein, is acquired or held in violation of this
section 6.02(b), the next preceding permitted beneficial owner will be treated
as the beneficial owner of that Certificate, retroactive to the date of transfer
to the purported beneficial owner. Any purported beneficial owner whose
acquisition or holding of a Certificate, or interest therein, was effected
in
violation of this Section shall indemnify to the extent permitted by law and
hold harmless the Depositor, the Sponsor, the Master Servicer, the Securities
Administrator, the Servicers, the Underwriters and the Trustee from and against
any and all liabilities, claims, costs or expenses incurred by such parties
as a
result of such acquisition or holding.
(c) (i)
Each
Person who has or who acquires any Ownership Interest in a Residual Certificate
shall be deemed by the acceptance or acquisition of such Ownership Interest
to
have agreed to be bound by the following provisions, and the rights of each
Person acquiring any Ownership Interest in a Residual Certificate are expressly
subject to the following provisions:
(A) Each
Person holding or acquiring any Ownership Interest in a Residual Certificate
shall be a Permitted Transferee and shall promptly notify the Securities
Administrator of any change or impending change in its status as a Permitted
Transferee.
(B) In
connection with any proposed Transfer of any Ownership Interest in a Residual
Certificate, the Trustee shall require delivery to it, and shall not register
the Transfer of any Residual Certificate until its receipt of, an affidavit
and
agreement (a “Transfer Affidavit and Agreement,” in the form attached hereto as
Exhibit D) from the proposed Transferee, in form and substance satisfactory
to
the Securities Administrator, representing and warranting, among other things,
that such Transferee is a Permitted Transferee, that it is not acquiring its
Ownership Interest in the Residual Certificate that is the subject of the
proposed Transfer as a nominee, trustee or agent for any Person that is not
a
Permitted Transferee, that for so long as it retains its Ownership Interest
in a
Residual Certificate, it will endeavor to remain a Permitted Transferee, and
that it has reviewed the provisions of this Section 6.02(c) and agrees to
be bound by them.
(C) Notwithstanding
the delivery of a Transfer Affidavit and Agreement by a proposed Transferee
under clause (B) above, if an authorized officer of the Securities Administrator
who is assigned to this transaction has actual knowledge that the proposed
Transferee is not a Permitted Transferee, no Transfer of an Ownership Interest
in a Residual Certificate to such proposed Transferee shall be
effected.
(D) Each
Person holding or acquiring any Ownership Interest in a Residual Certificate
shall agree (x) to require a Transfer Affidavit and Agreement from any other
Person to whom such Person attempts to transfer its Ownership Interest in a
Residual Certificate and (Y) not to transfer its Ownership Interest unless
it
provides a Transferor Affidavit (in the form attached hereto as Exhibit B-2)
to
the Securities Administrator stating that, among other things, it has no actual
knowledge that such other Person is not a Permitted Transferee.
(E) Each
Person holding or acquiring an Ownership Interest in a Residual Certificate,
by
purchasing an Ownership Interest in such Certificate, agrees to give the
Securities Administrator written notice that it is a “pass-through interest
holder” within the meaning of temporary Treasury regulation
Section 1.67-3T(a)(2)(i)(A) immediately upon acquiring an Ownership
Interest in a Residual Certificate, if it is, or is holding an Ownership
Interest in a Residual Certificate on behalf of, a “pass-through interest
holder.”
(ii) The
Securities Administrator will register the Transfer of any Residual Certificate
only if it shall have received the Transfer Affidavit and Agreement and all
of
such other documents as shall have been reasonably required by the Securities
Administrator as a condition to such registration. In addition, no Transfer
of a
Residual Certificate shall be made unless the Securities Administrator shall
have received a representation letter from the Transferee of such Certificate
to
the effect that such Transferee is a Permitted Transferee.
(iii) (A)
If any
purported Transferee shall become a Holder of a Residual Certificate in
violation of the provisions of this Section 6.02(c), then the last
preceding Permitted Transferee shall be restored, to the extent permitted by
law, to all rights as holder thereof retroactive to the date of registration
of
such Transfer of such Residual Certificate. The Securities Administrator 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 6.02(c)
or for making any payments due on such Certificate to the holder thereof or
for
taking any other action with respect to such holder under the provisions of
this
Agreement.
(B) If
any
purported Transferee shall become a holder of a Residual Certificate in
violation of the restrictions in this Section 6.02(c) and to the extent
that the retroactive restoration of the rights of the holder of such Residual
Certificate as described in clause (iii)(A) above shall be invalid, illegal
or
unenforceable, then the Securities Administrator shall have the right, without
notice to the holder or any prior holder of such Residual Certificate, to sell
such Residual Certificate to a purchaser selected by the Securities
Administrator on such terms as the Securities Administrator may choose. Such
purported Transferee shall promptly endorse and deliver each Residual
Certificate in accordance with the instructions of the Securities Administrator.
Such purchaser may be the Securities Administrator itself or any Affiliate
of
the Securities Administrator. The proceeds of such sale, net of the commissions
(which may include commissions payable to the Securities Administrator or its
Affiliates), expenses and taxes due, if any, will be remitted by the Securities
Administrator to such purported Transferee. The terms and conditions of any
sale
under this clause (iii)(B) shall be determined in the sole discretion of the
Securities Administrator, and the Securities Administrator shall not be liable
to any Person having an Ownership Interest in a Residual Certificate as a result
of its exercise of such discretion.
(iv) The
Securities Administrator shall make available to the Internal Revenue Service
and those Persons specified by the REMIC Provisions all information necessary
to
compute any tax imposed (A) as a result of the Transfer of an Ownership Interest
in a Residual Certificate to any Person who is a Disqualified Organization,
including the information described in Treasury regulations sections
1.860D-1(b)(5) and 1.860E-2(a)(5) with respect to the “excess inclusions” of
such Residual Certificate and (B) as a result of any regulated investment
company, real estate investment trust, common trust fund, partnership, trust,
estate or organization described in Section 1381 of the Code that holds an
Ownership Interest in a Residual Certificate having as among its record holders
at any time any Person which is a Disqualified Organization. Reasonable
compensation for providing such information may be charged or collected by
the
Securities Administrator.
(v) The
provisions of this Section 6.02(c) set forth prior to this subsection (v)
may be modified, added to or eliminated, provided that there shall have been
delivered to the Securities Administrator at the expense of the party seeking
to
modify, add to or eliminate any such provision the following:
(A) written
notification from each Rating Agency to the effect that the modification,
addition to or elimination of such provisions will not cause such Rating Agency
to downgrade its then-current ratings of any Class of Certificates;
and
(B) an
Opinion of Counsel, in form and substance satisfactory to the Securities
Administrator, to the effect that such modification of, addition to or
elimination of such provisions will not cause any Trust REMIC to cease to
qualify as a REMIC and will not cause any Trust REMIC, as the case may be,
to be
subject to an entity-level tax caused by the Transfer of any Residual
Certificate to a Person that is not a Permitted Transferee or a Person other
than the prospective transferee to be subject to a REMIC-tax caused by the
Transfer of a Residual Certificate to a Person that is not a Permitted
Transferee.
(d) Subject
to the preceding subsections, upon surrender for registration of transfer of
any
Certificate at any office or agency of the Securities Administrator maintained
for such purpose pursuant to Section 9.11, the Securities Administrator
shall execute, authenticate and deliver, in the name of the designated
Transferee or Transferees, one or more new Certificates of the same Class of
a
like aggregate Percentage Interest.
(e) At
the
option of the Holder thereof, any Certificate may be exchanged for other
Certificates of the same Class with authorized denominations and a like
aggregate Percentage Interest, upon surrender of such Certificate to be
exchanged at any office or agency of the Securities Administrator maintained
for
such purpose pursuant to Section 9.11. Whenever any Certificates are so
surrendered for exchange, the Securities Administrator shall execute,
authenticate and deliver, the Certificates which the Certificateholder making
the exchange is entitled to receive. Every Certificate presented or surrendered
for transfer or exchange shall (if so required by the Securities Administrator)
be duly endorsed by, or be accompanied by a written instrument of transfer
in
the form satisfactory to the Securities Administrator duly executed by, the
Holder thereof or his attorney duly authorized in writing. In
addition, (i) with respect to each Class R Certificate, the holder thereof
may
exchange, in the manner described above, such Class R Certificate for three
separate certificates, each representing such holder's respective Percentage
Interest in the Class R-I Interest, the Class R-II Interest and the Class R-III
Interest, respectively, in each case that was evidenced by the Class R
Certificate being exchanged and (ii) with respect to each Class R-X Certificate,
the holder thereof may exchange, in the manner described above, such Class
R-X
Certificate for three separate certificates, each representing such holder's
respective Percentage Interest in the Class R-IV Interest, the Class R-V
Interest and the Class R-VI Interest, respectively, in each case that was
evidenced by the Class R-X Certificate being exchanged.
(f) No
service charge to the Certificateholders shall be made for any transfer or
exchange of Certificates, but the Securities Administrator may require payment
of a sum sufficient to cover any tax or governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
(g) The
preparation and delivery of all certificates and opinions referred to above
in
this Section 6.02 shall not be an expense of the Trust Fund, the Securities
Administrator, the Depositor or the Sponsor.
(h) All
Certificates surrendered for transfer and exchange shall be canceled and
destroyed by the Securities Administrator in accordance with its customary
procedures.
Section
6.03 Mutilated,
Destroyed, Lost or Stolen Certificates.
If
(a)
any mutilated Certificate is surrendered to the Securities Administrator, or
the
Securities Administrator receives evidence to its satisfaction of the
destruction, loss or theft of any Certificate and of the ownership thereof
and
(b) there is delivered to the Securities Administrator such security or
indemnity as may be required by them to save each of them harmless, then, in
the
absence of notice to the Securities Administrator that such Certificate has
been
acquired by a bona fide purchaser, the Securities Administrator shall execute,
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of like Class, tenor
and Percentage Interest. In connection with the issuance of any new Certificate
under this Section 6.03, the Securities Administrator 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 Securities Administrator) connected therewith. Any
replacement Certificate issued pursuant to this Section 6.03 shall
constitute complete and indefeasible evidence of ownership in the Trust Fund,
as
if originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time. All Certificates surrendered to the Securities
Administrator under the terms of this Section 6.03 shall be canceled and
destroyed by the Securities Administrator in accordance with its standard
procedures without liability on its part.
Section
6.04 Persons
Deemed Owners.
The
Depositor, the Servicer, the Trustee, the Master Servicer, the Securities
Administrator and any of their agents may treat the person in whose name any
Certificate is registered as the owner of such Certificate for the purpose
of
receiving distributions as provided in this Agreement and for all other purposes
whatsoever, and none of the Depositor, the Servicer, the Trustee, the Master
Servicer, the Securities Administrator nor any of their agents shall be affected
by any notice to the contrary.
Section
6.05 Access
to List of Certificateholders’ Names and Addresses.
If
three
or more Certificateholders (a) request such information in writing from the
Securities Administrator, (b) state that such Certificateholders desire to
communicate with other Certificateholders with respect to their rights under
this Agreement or under the Certificates, and (c) provide a copy of the
communication that such Certificateholders propose to transmit or if the
Depositor shall request such information in writing from the Securities
Administrator, then the Securities Administrator shall, within ten Business
Days
after the receipt of such request, provide the Depositor or such
Certificateholders at such recipients’ expense the most recent list of the
Certificateholders of the Trust Fund held by the Securities Administrator,
if
any. The Depositor and every Certificateholder, by receiving and holding a
Certificate, agree that the Securities Administrator shall not be held
accountable by reason of the disclosure of any such information as to the list
of the Certificateholders hereunder, regardless of the source from which such
information was derived.
Section
6.06 Book-Entry
Certificates.
The
Regular 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 by or on behalf of the Depositor. Such
Certificates shall initially be registered on the Certificate Register in the
name of the Depository or its nominee, and no Certificate Owner of such
Certificates will receive a definitive certificate representing such Certificate
Owner’s interest in such Certificates, except as provided in Section 6.08.
Unless and until definitive, fully registered Certificates (“Definitive
Certificates”) have been issued to the Certificate Owners of such Certificates
pursuant to Section 6.08:
(a) the
provisions of this Section shall be in full force and effect;
(b) the
Depositor and the Securities Administrator may deal with the Depository and
the
Depository Participants for all purposes (including the making of distributions)
as the authorized representative of the respective Certificate Owners of such
Certificates;
(c) registration
of the Book-Entry Certificates may not be transferred by the Securities
Administrator except to another Depository;
(d) the
rights of the respective Certificate Owners of such Certificates shall be
exercised only through the Depository and the Depository Participants and shall
be limited to those established by law and agreements between the Owners of
such
Certificates and the Depository and/or the Depository Participants. Pursuant
to
the Depository Agreement, unless and until Definitive Certificates are issued
pursuant to Section 6.08, the Depository will make book-entry transfers
among the Depository Participants and receive and transmit distributions of
principal and interest on the related Certificates to such Depository
Participants;
(e) the
Depository may collect its usual and customary fees, charges and expenses from
its Depository Participants;
(f) the
Depositor, the Servicer, the Trustee, the Master Servicer and the Securities
Administrator may rely and shall be fully protected in relying upon information
furnished by the Depository with respect to its Depository Participants;
and
(g) to
the
extent that the provisions of this Section conflict with any other
provisions of this Agreement, the provisions of this Section shall
control.
For
purposes of any provision of this Agreement requiring or permitting actions
with
the consent of, or at the direction of, Certificateholders evidencing a
specified percentage of the aggregate unpaid principal amount of any Class
of
Certificates, such direction or consent may be given by Certificate Owners
(acting through the Depository and the Depository Participants) owning
Book-Entry Certificates evidencing the requisite percentage of principal amount
of such Class of Certificates.
Section
6.07 Notices
to Depository.
Whenever
any notice or other communication is required to be given to Certificateholders
of a Class with respect to which Book-Entry Certificates have been issued,
unless and until Definitive Certificates shall have been issued to the related
Certificate Owners, the Securities Administrator shall give all such notices
and
communications to the Depository.
Section
6.08 Definitive
Certificates.
If,
after
Book-Entry Certificates have been issued with respect to any Certificates,
(a)
the Depositor or the Depository advises the Securities Administrator that the
Depository is no longer willing or able to discharge properly its
responsibilities under the Depository Agreement with respect to such
Certificates and the Securities Administrator or the Depositor is unable to
locate a qualified successor, (b) the Depositor, at its sole option, advises
the
Securities Administrator that it elects to terminate the book-entry system
with
respect to such Certificates through the Depository or (c) after the occurrence
and continuation of either of the events described in clauses (a) or (b) above,
Certificate Owners of such Book-Entry Certificates having not less than fifty
one percent (51%) of the Voting Rights evidenced by any Class of Book-Entry
Certificates advise the Securities Administrator and the Depository in writing
through the Depository Participants that the continuation of a book-entry system
with respect to Certificates of such Class through the Depository (or its
successor) is no longer in the best interests of the Certificate Owners of
such
Class, then the Securities Administrator shall notify all Certificate Owners
of
such Certificates, through the Depository, of the occurrence of any such event
and of the availability of Definitive Certificates to applicable Certificate
Owners requesting the same. The Depositor shall provide the Securities
Administrator with an adequate inventory of certificates to facilitate the
issuance and transfer of Definitive Certificates. Upon surrender to the
Securities Administrator of any such Certificates by the Depository, accompanied
by registration instructions from the Depository for registration, the
Securities Administrator shall countersign and deliver such Definitive
Certificates. Neither the Depositor nor the Securities Administrator shall
be
liable for any delay in delivery of such instructions and each may conclusively
rely on, and shall be protected in relying on, such instructions. Upon the
issuance of such Definitive Certificates, all references herein to obligations
imposed upon or to be performed by the Depository shall be deemed to be imposed
upon and performed by the Securities Administrator, to the extent applicable
with respect to such Definitive Certificates and the Securities Administrator
shall recognize the Holders of such Definitive Certificates as
Certificateholders hereunder.
Section
6.09 Maintenance
of Office or Agency.
Certificates
may be surrendered for registration of transfer or exchange at the applicable
Corporate Trust Office of the Securities Administrator. The Securities
Administrator will give prompt written notice to the Certificateholders of
any
change in such location of any such office or agency.
ARTICLE
VII
THE
DEPOSITOR, THE
SERVICERS AND THE MASTER SERVICER
Section
7.01 Liabilities
of the Depositor, the Servicers and the Master Servicer.
Each
of
the Depositor, the Servicers and the Master Servicer shall be liable in
accordance herewith only to the extent of the obligations specifically imposed
upon and undertaken by it herein.
Section
7.02 Merger
or Consolidation of the Depositor, the Servicers or the Master
Servicer.
(a) Each
of
the Depositor and each Servicer will keep in full force and effect its rights
and franchises as a corporation or a limited liability company (or other entity
resulting from merger, conversion, or consolidation to the extent permitted
under this Section 7.02), as applicable, under the laws of the state of its
formation, and
will
obtain and preserve its qualification to do business as a foreign corporation,
limited liability company, or other such entity in each jurisdiction in which
such qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, the Certificates or any of the Mortgage Loans
and to perform its duties under this Agreement.
The
Master Servicer will keep in full force and effect its existence, rights and
franchises as a national banking association, and will obtain and preserve
its
qualification to do business as a foreign corporation in each jurisdiction
in
which such qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, the Certificates or any of the Mortgage Loans
and to perform its duties under this Agreement.
(b) The
Depositor, any Servicer or the Master Servicer may be merged or consolidated,
or
any person resulting from any merger or consolidation to which the Depositor,
such Servicer or the Master Servicer shall be a party, or any Person succeeding
to the business of the Depositor, such Servicer or the Master Servicer shall
be
the successor of the Depositor, such Servicer or the Master Servicer hereunder,
without the execution or filing of any paper or further act on the part of
any
of the parties hereto, anything herein to the contrary notwithstanding, provided
that any Successor Servicer shall have represented that it meets the eligibility
criteria set forth in Section 8.02.
Section
7.03 Indemnification
by Depositor, the Servicers and Servicing Function Participants.
(a) The
Depositor agrees to indemnify the Indemnified Persons for, and to hold them
harmless against, any loss, liability or expense (including reasonable legal
fees and disbursements of counsel) incurred on their part that may be sustained
in connection with, arising out of, or relating to, any claim or legal action
(including any pending or threatened claim or legal action) relating to this
Agreement or the Certificates (i) related to the Depositor’s failure to perform
its duties in compliance with this Agreement (except as any such loss, liability
or expense shall be otherwise reimbursable pursuant to this Agreement) or (ii)
incurred by reason of the Depositor’s willful misfeasance, bad faith or gross
negligence in the performance of duties hereunder or by reason of reckless
disregard of obligations and duties hereunder. This indemnity shall survive
the
resignation and the termination of this Agreement.
(b) Each
Servicer agrees to indemnify the Indemnified Persons for, and to hold them
harmless against, any loss, liability or expense (including reasonable legal
fees and disbursements of counsel) incurred on their part that may be sustained
in connection with, arising out of, or relating to, any claim or legal action
(including pending or threatened claim or legal action) relating to such
Servicer’s gross negligence in the performance of its duties under this
Agreement or failure to service the related Mortgage Loans in material
compliance with the terms of this Agreement or for a material breach of any
representation or warranty of such Servicer contained herein. Each Servicer
shall immediately notify the Trustee if a claim relating to the preceding
sentence is made by a third party with respect to this Agreement or the related
Mortgage Loans for which such Servicer is required to provide indemnification
pursuant to this Section 7.03(b), assume (with the consent of the Trustee and
with counsel reasonably satisfactory to the Trustee) the defense of any such
claim and, subject to Section 7.04(e), pay all expenses in connection therewith,
including counsel fees, and promptly appeal or pay, discharge and satisfy any
final, non-appealable judgment or decree which may be entered against it or
any
Indemnified Person in respect of such claim, but failure to so notify the
Trustee shall not limit the Servicer’s obligations hereunder. Each Servicer
agrees that it will not enter into any settlement of any such claim without
the
consent of the Indemnified Persons unless such settlement includes an
unconditional release of such Indemnified Persons from all liability that is
the
subject matter of such claim. The provisions of this Section 7.03(b) shall
survive termination of this Agreement.
(c) Each
of
the Depositor, Master Servicer, Securities Administrator and any Servicing
Function Participant engaged by such party, respectively, shall indemnify and
hold harmless the Master Servicer, the Securities Administrator and the
Depositor, respectively, and each of the other parties to this Agreement and
its
respective directors, officers, employees, agents, and Affiliates from and
against any and all claims, losses, damages, penalties, fines, forfeitures,
reasonable legal fees and related costs, judgments and other costs and expenses
arising out of or based upon (a) any breach by such party of any if its
obligations under hereunder, including particularly its obligations to provide
any Assessment of Compliance, Attestation Report, Compliance Statement or any
information, data or materials required to be included in any 1934 Act report,
(b) any material misstatement or omission of a material fact required to be
stated or necessary to make such statements, in light of circumstances in which
they were made, not misleading, in any information, data or materials provided
by such party (or, in the case of the Securities Administrator or Master
Servicer, any material misstatement or material omission in (i) any Compliance
Statement, Assessment of Compliance or Attestation Report delivered by it,
or by
any Servicing Function Participant engaged by it, pursuant to this Agreement,
or
(ii) any Additional Form 10-D Disclosure, Additional Form 10-K Disclosure or
Form 8-K Disclosure concerning the Master Servicer or the Securities
Administrator), or (c) the negligence, bad faith or willful misconduct of such
indemnifying party in connection with its performance hereunder. If the
indemnification provided for in this Section 7.03(c) is unavailable or
insufficient to hold harmless the Master Servicer, the Securities Administrator
or the Depositor, as the case may be, then each such party agrees that it shall
contribute to the amount paid or payable by the Master Servicer, the Securities
Administrator or the Depositor, as applicable, as a result of any claims,
losses, damages or liabilities incurred by such party in such proportion as
is
appropriate to reflect the relative fault of the indemnified party on the one
hand and the indemnifying party on the other. This indemnification shall survive
the termination of this Agreement or the termination of any party to this
Agreement.
Section
7.04 Limitations
on Liability of the Depositor, the Securities Administrator, the Master
Servicer, the Servicers and Others.
Subject
to the obligation of the Depositor and the Servicers to indemnify the
Indemnified Persons pursuant to Section 7.03:
(a) Neither
the Depositor, the Securities Administrator, the Master Servicer, the Servicers
nor any of the directors, officers, employees or agents of the Depositor, the
Securities Administrator, the Master Servicer and the Servicers shall be under
any liability to the Indemnified Persons, the Trust Fund or the
Certificateholders for taking any action or for refraining from taking any
action in good faith pursuant to this Agreement, or for errors in judgment;
provided, however, that this provision shall not protect the Depositor, the
Securities Administrator, the Master Servicer, the Servicers or any such Person
against any breach of warranties, representations or covenants made herein
or
against any specific liability imposed on any such Person pursuant hereto or
against any liability which would otherwise be imposed by reason of such
Person’s willful misfeasance, bad faith or gross negligence in the performance
of duties or by reason of reckless disregard of obligations and duties
hereunder.
(b) The
Depositor, the Securities Administrator, the Master Servicer, the Servicers
and
any director, officer, employee or agent of the Depositor, the Securities
Administrator, the Master Servicer and a Servicer may rely in good faith on
any
document of any kind prima facie properly executed and submitted by any Person
respecting any matters arising hereunder.
(c) The
Depositor, the Securities Administrator, the Master Servicer, the Servicers,
the
Trustee, the Custodian and any director, officer, employee or agent of the
Depositor, the Securities Administrator, the Master Servicer, the Servicers,
the
Trustee or the Custodian shall be indemnified by the Trust Fund and held
harmless thereby against any loss, liability or expense (including reasonable
legal fees and disbursements of counsel) incurred on their part that may be
sustained in connection with, arising out of, or relating to this Agreement,
the
Custodial Agreement or the Certificates (including any pending or threatened
claim or legal action), other than (i) with respect to the Custodian, any loss,
liability or expense arising from or otherwise related to the Custodian’s
failure to perform its duties under the Custodial Agreement, (ii) with respect
to a Servicer, any such loss, liability or expense arising from or related
to
such Servicer’s gross negligence in the performance of its duties hereunder or
failure to service the related Mortgage Loans in material compliance with the
terms of this Agreement or a material breach of any representation or warranty
of such Servicer contained herein or (iii) with respect to the Custodian, any
such loss, liability or expense incurred by reason of the Custodian’s willful
misfeasance, bad faith or gross negligence in the performance of its duties
hereunder.
(d) The
Depositor, the Securities Administrator, the Servicers or the Master Servicer
shall not be under any obligation to appear in, prosecute or defend any legal
action that is not incidental to its duties under this Agreement and that in
its
opinion may involve it in any expense or liability; provided, however, that
each
of the Depositor, the Securities Administrator, the Servicers and the Master
Servicer may in its discretion, undertake any such action which it may deem
necessary or desirable with respect to this Agreement and the rights and duties
of the parties hereto and the interests of the Certificateholders hereunder.
In
such event, the legal expenses and costs of such action and any liability
resulting therefrom (except any loss, liability or expense incurred by reason
of
willful misfeasance, bad faith or gross negligence in the performance of duties
hereunder or by reason of reckless disregard of obligations and duties
hereunder) shall be expenses, costs and liabilities of the Trust Fund, and
the
Depositor, the Securities Administrator, the Servicers and the Master Servicer
shall be entitled to be reimbursed therefor out of the related Custodial Account
or the Distribution Account as provided by Section 3.27 or Section 3.32, as
applicable. Nothing in this Subsection 7.04(d) shall affect the Master
Servicer’s obligation to take such actions as are necessary to ensure the
servicing and administration of the related Mortgage Loans pursuant to this
Agreement.
(e) In
taking
or recommending any course of action pursuant to this Agreement, unless
specifically required to do so pursuant to this Agreement, the Trustee shall
not
be required to investigate or make recommendations concerning potential
liabilities which the Trust might incur as a result of such course of action
by
reason of the condition of the Mortgaged Properties.
(f) The
Trustee shall not be liable for any acts or omissions of the Servicer, the
Depositor or the Custodian.
Section
7.05 The
Servicers Not to Resign.
(a) No
Servicer shall resign from the obligations and duties hereby imposed on it
except upon the determination that its duties hereunder are no longer
permissible under applicable law or the performance of such duties are no longer
possible in order to comply with applicable law and such incapacity or
impossibility cannot be cured by such Servicer. Any determination permitting
the
resignation of a Servicer shall be evidenced by an Opinion of Counsel to such
effect delivered to the Master Servicer which Opinion of Counsel shall be in
form and substance reasonably acceptable to the Master Servicer. No appointment
of a successor to the resigning Servicer shall be effective hereunder unless
(a)
the Rating Agencies have confirmed in writing that such appointment will not
result in a downgrade, qualification or withdrawal of the then current ratings
assigned to the Certificates, (b) such successor shall have represented that
it
is meets the eligibility criteria set forth in Section 8.02 and (c) such
successor has agreed in writing to assume the obligations of the resigning
Servicer hereunder. The resigning Servicer shall provide a copy of the written
confirmation of the Rating Agencies and the agreement executed by such successor
to the Master Servicer. No such resignation shall become effective until a
Successor Servicer or the Master Servicer shall have assumed the Servicer’s
responsibilities and obligations hereunder. The Servicer shall notify the Master
Servicer and the Rating Agencies of its resignation.
(b) Except
as
expressly provided herein, no Servicer shall assign or transfer any of its
rights, benefits or privileges hereunder to any other Person, or delegate to
or
subcontract with, or authorize or appoint any other Person to perform any of
the
duties, covenants or obligations to be performed by such Servicer hereunder.
The
foregoing prohibition on assignment shall not prohibit a Servicer from
designating a Subservicer as payee of any indemnification or other amount
payable to such Servicer hereunder; provided, however, that as provided in
Section 3.03, no Subservicer shall be a third-party beneficiary hereunder
and the parties hereto shall not be required to recognize any Subservicer as
an
indemnitee under this Agreement.
(c) Notwithstanding
anything to the contrary herein, Ocwen may pledge or assign as collateral all
its rights, title and interest under this Agreement to a lender (the “Servicing
Rights Lender”), provided, that:
(i) upon
a
Servicer Event of Default and receipt of a notice of termination by Ocwen,
the
Servicing Rights Lender may direct Ocwen or its designee to appoint a Successor
Servicer pursuant to the provisions, and subject to the conditions, set forth
in
Section 8.02 regarding such appointment of a Successor
Servicer;
(ii) the
Servicing Rights Lender’s rights are subject to this Agreement; and
(iii) Ocwen
shall remain subject to termination as servicer under this Agreement pursuant
to
the terms hereof.
Section
7.06 Appointment
of Special Servicer; Termination of the Servicer.
(a) The
Sponsor may appoint a special servicer with respect to certain of the Mortgage
Loans. The Sponsor and the related Servicer shall negotiate in good faith with
any proposed special servicer with respect to the duties and obligations of
such
special servicer with respect to any such Mortgage Loan. Any subservicing
agreement shall contain terms and provisions not inconsistent with this
Agreement and shall obligate the special servicer to service such Mortgage
Loans
in accordance with Accepted Servicing Practices. The fee payable to the special
servicer for the performance of such duties and obligations will be paid from
the Servicing Fee collected by the related Servicer with respect to each such
Mortgage Loan and will be remitted to such special servicer by the related
Servicer. The Sponsor shall reimburse the related Servicer for Servicing Fee
shortfalls, if any, incurred as a result of the fee payable to such special
servicer.
(b) If
at any
time the Sponsor retains or comes into possession of any servicing rights with
respect to any of the Mortgage Loans, the Sponsor may, at its option, terminate
the servicing responsibilities of the related Servicer hereunder with respect
to
such Mortgage Loans without cause. No such termination shall become effective
unless and until a successor to the related Servicer shall have been appointed
to service and administer the related Mortgage Loans pursuant to the terms
and
conditions of this Agreement. No appointment shall be effective unless (i)
such
Successor Servicer meets the eligibility criteria contained in
Section 8.02, (ii) the Master Servicer shall have consented to such
appointment, (iii) the Rating Agencies have been notified in writing of such
appointment and such Successor Servicer meets the Minimum Servicing
Requirements, (iv) such successor has agreed to assume the obligations of the
related Servicer hereunder to the extent of the related Mortgage Loans and
(v)
all amounts reimbursable to the terminated Servicer pursuant to the terms of
this Agreement shall have been paid to the related Servicer by the Successor
Servicer appointed pursuant to the terms of this Section 7.06 or by the
Sponsor including without limitation, all unpaid Servicing Fees accrued and
unreimbursed Advances and Servicing Advances made by the terminated Servicer
and
all out-of-pocket expenses of the related Servicer incurred in connection with
the transfer of servicing to such successor. The Sponsor shall provide a copy
of
the agreement executed by such successor to the Trustee and the Master
Servicer.
Section
7.07 Limitation
on Resignation of the Master Servicer.
The
Master Servicer shall not resign from the obligations and duties hereby imposed
on it except upon determination that its duties hereunder are no longer
permissible under applicable law. Any such determination pursuant to the
preceding sentence permitting the resignation of the Master Servicer shall
be
evidenced by an Opinion of Counsel to such effect obtained at the expense of
the
Master Servicer and delivered to the Trustee and the Rating Agencies. No
resignation of the Master Servicer shall become effective until the Trustee
or a
successor Master Servicer meeting the criteria specified in Section 7.08
shall have assumed the Master Servicer’s responsibilities, duties, liabilities
(other than those liabilities arising prior to the appointment of such
successor) and obligations under this Agreement.
Section
7.08 Assignment
of Master Servicing.
The
Master Servicer may sell and assign its rights and delegate its duties and
obligations in its entirety as Master Servicer under this Agreement; provided,
however, that: (i) the purchaser or transferee accepting such assignment and
delegation and assuming the obligations of the Master Servicer hereunder (a)
shall have a net worth of not less than $15,000,000 (unless otherwise approved
by each Rating Agency pursuant to clause (ii) below); (b) shall be reasonably
satisfactory to the Trustee (as evidenced in a writing signed by the Trustee);
and (c) shall execute and deliver to the Trustee an agreement, in form and
substance reasonably satisfactory to the Trustee, which contains an assumption
by such Person of the due and punctual performance and observance of each
covenant and condition to be performed or observed by it as Master Servicer
under this Agreement, any custodial agreement from and after the effective
date
of such agreement; (ii) each Rating Agency shall be given prior written notice
of the identity of the proposed successor to the Master Servicer and each Rating
Agency’s rating of the Certificates in effect immediately prior to such
assignment, sale and delegation will not be downgraded, qualified or withdrawn
as a result of such assignment, sale and delegation, as evidenced by a letter
to
such effect delivered to the Master Servicer and the Trustee; and (iii) the
Master Servicer assigning the master servicing shall deliver to the Trustee
an
officer’s certificate and an Opinion of Independent counsel, each stating that
all conditions precedent to such action under this Agreement have been completed
and such action is permitted by and complies with the terms of this Agreement.
No such assignment or delegation shall affect any liability of the Master
Servicer arising out of acts or omissions prior to the effective date
thereof.
Section
7.09 Rights
of the Depositor in Respect of the Servicers and the Master
Servicer.
Each
of
the Master Servicer and the Servicers shall afford (and any Subservicing
Agreement shall provide that each Subservicer shall afford) the Depositor and
the Trustee, upon reasonable notice, during normal business hours, access to
all
records maintained by the Master Servicer or the Servicers (and any such
Subservicer) in respect of the rights and obligations of the Servicers hereunder
and access to officers of the Master Servicer or the Servicers (and those of
any
such Subservicer) responsible for such obligations, and the Master Servicer
shall have access to all such records maintained by the Servicers and any
Subservicers. Upon request, the Master Servicer and each Servicer shall furnish
to the Depositor and the Trustee its (and any such Subservicer’s) most recent
financial statements and such other reasonably requested information relating
to
the Master Servicer’s or such Servicer’s capacity to perform its obligations
under this Agreement as it possesses (and that any such Subservicer possesses).
To the extent that the Trustee and the Depositor are informed that such
information is not otherwise available to the public, the Depositor and the
Trustee shall not disseminate any information obtained pursuant to the preceding
two sentences without the Master Servicer’s or such Servicer’s (as applicable)
written consent, except as required pursuant to this Agreement or to the extent
that it is appropriate to do so (i) to its legal counsel, auditors, taxing
authorities or other governmental agencies and the Certificateholders, (ii)
pursuant to any law, rule, regulation, order, judgment, writ, injunction or
decree of any court or governmental authority having jurisdiction over the
Depositor and the Trustee or the Trust Fund, and in any case, the Depositor
or
the Trustee, (iii) disclosure of any and all information that is or becomes
publicly known, or information obtained by the Trustee from sources other than
the Depositor, the Servicers or the Master Servicer, (iv) disclosure as required
pursuant to this Agreement or (v) disclosure of any and all information (A)
in
any preliminary or final offering circular, registration statement or contract
or other document pertaining to the transactions contemplated by the Agreement
approved in advance by the Depositor, the Servicers or the Master Servicer
or
(B) to any Affiliate, independent or internal auditor, agent, employee or
attorney of the Trustee having a need to know the same, provided that the
Trustee advises such recipient of the confidential nature of the information
being disclosed, shall use its best efforts to assure the confidentiality of
any
such disseminated non-public information. Nothing in this Section 7.09
shall limit the obligation of a Servicer to comply with any applicable law
prohibiting disclosure of information regarding the Mortgagors and the failure
of such Servicer to provide access as provided in this Section 7.09 as a
result of such obligation shall not constitute a breach of this Section. Nothing
in this Section 7.09 shall require a Servicer to collect, create, collate
or otherwise generate any information that it does not generate in its usual
course of business. No Servicer shall be required to make copies of or ship
documents to any party unless provisions have been made for the reimbursement
of
the costs thereof. The Depositor may, but is not obligated to, enforce the
obligations of the Master Servicer and the Servicers under this Agreement and
may, but is not obligated to, perform, or cause a designee to perform, any
defaulted obligation of the Master Servicer or the Servicers under this
Agreement or exercise the rights of the Master Servicer or the Servicers under
this Agreement; provided that neither the Master Servicer nor the Servicer
shall
be relieved of any of its obligations under this Agreement by virtue of such
performance by the Depositor or its designee. The Depositor shall not have
any
responsibility or liability for any action or failure to act by the Master
Servicer or the Servicers and is not obligated to supervise the performance
of
the Master Servicer or the Servicer under this Agreement or
otherwise.
ARTICLE
VIII
DEFAULT;
TERMINATION OF SERVICER
AND MASTER SERVICER
Section
8.01 Events
of Default.
(a) (I) In
case
one or more of the following events of default by a Servicer pursuant to this
Agreement shall occur and be continuing, that is to say:
(i) any
failure by such Servicer to remit to the Securities Administrator any payment
required to be made under the terms of this Agreement which continues unremedied
for a period of two Business Days;
provided however that the failure of Ocwen to
remit
any Advance required pursuant to Section 5.01 by noon on the related
Distribution Date shall be a default hereunder without notice; or
(ii) failure
on the part of such
Servicer to
duly
observe or perform in any material respect any other of the covenants or
agreements on the part of such Servicer set forth in this Agreement (other
than
those described in (viii) and (ix) below), the breach of which has a material
adverse effect and which continue unremedied for a period of thirty (30) days
after the date on which written notice of such failure, requiring the same
to be
remedied, shall have been given to such Servicer and the Trustee or the
Depositor by the Master Servicer or to such Servicer and the Trustee or the
Depositor by the holders of Certificates evidencing not less than 25% of the
Voting Rights evidenced by the Certificates; or
(iii) a
decree
or order of a court or agency or supervisory authority having jurisdiction
for
the appointment of a conservator or receiver or liquidator in any insolvency,
bankruptcy, readjustment of debt, marshaling of assets and liabilities or
similar proceedings, or for the winding-up or liquidation of its affairs, shall
have been entered against such Servicer and such decree or order shall have
remained in force undischarged or unstayed for a period of sixty days;
or
(iv) such
Servicer shall consent to the appointment of a conservator or receiver or
liquidator in any insolvency, bankruptcy, readjustment of debt, marshaling
of
assets and liabilities or similar proceedings of or relating to such Servicer
or
of or relating to all or substantially all of its property; or
(v) such
Servicer shall admit in writing its inability to pay its debts generally as
they
become due, file a petition to take advantage of any applicable insolvency
or
reorganization statute, make an assignment for the benefit of its creditors,
or
voluntarily suspend payment of its obligations; or
(vi) such
Servicer attempts to assign its right to servicing compensation hereunder (other
than any payment by such Servicer to a Subservicer pursuant to Section 3.03)
or
such Servicer attempts to sell or otherwise dispose of all or substantially
all
of its property or assets or to assign this Agreement or its servicing
responsibilities hereunder or to delegate its duties hereunder or any portion
thereof except, in each case as otherwise permitted herein; or
(vii) such
Servicer ceases to be qualified to transact business in any jurisdiction where
it is currently so qualified, but only to the extent such non-qualification
materially and adversely affects such Servicer’s ability to perform its
obligations hereunder; or
(viii) so
long
as the Trust Fund is subject to Exchange Act reporting requirements, failure
by
such Servicer to duly perform, within the required time period, its obligations
under Sections 3.13, 3.14, 3.18 or 5.14, which default shall not be subject
to
notice or a cure period; or
(ix) after
the
Trust Fund ceases to be subject to Exchange Act reporting requirements, any
failure by such Servicer to duly perform, within the required time period,
its
obligation to provide the annual statements of compliance, assessments of
compliance and attestation reports described in Sections 3.13 and 3.14 hereof,
which failure continues unremedied for a period of ten (10) Business Days after
the date on which written notice of such failure, requiring the same to be
remedied, has been given to such Servicer by the Master Servicer;
or
(x) any
failure by such Servicer (and any successor thereto) to provide, within the
required time period set forth in Section 3.28 hereof, any required reports
or
data pertaining to the related Mortgage Loans, which failure continues
unremedied for a period of thirty (30) days after the date on which written
notice of such failure, requiring the same to be remedied, has been given to
such Servicer (or any successor thereto) by the Master Servicer; or
| (II) |
With
respect to Xxxxx Fargo only, an event of default by Xxxxx Fargo under
the
Servicing Agreement.
|
Any
event
of default described above shall be referred to herein as a “Servicer
Default”.
In
each
and every case of a Servicer Default, so long as such Servicer Default with
respect to a Servicer other than Xxxxx Fargo shall not have been remedied,
the
Master Servicer, by notice in writing to the related Servicer shall with respect
to a payment default by such Sevicer pursuant to Section 8.01(a)(I)(i) of
this Agreement and, upon the occurrence and continuance of any other Servicer
Default, may, and, at the written direction of Certificateholders evidencing
not
less than twenty-five percent (25%) of the Voting Rights shall, in addition
to
whatever rights the Trustee on behalf of the Certificateholders may have under
Section 7.03 of this Agreement, as applicable and at law or equity to
damages, including injunctive relief and specific performance, terminate all
the
rights and obligations of such Servicer under this Agreement and in and to
the
related Mortgage Loans and the proceeds thereof without compensating such
Servicer for the same. In connection with the occurrence of a Servicer Default
by Xxxxx Fargo which shall not have been remedied, the Master Servicer shall
notify the Trustee and the Trustee, by notice in writing to Xxxxx Fargo, shall
with respect to a payment default by Xxxxx Fargo pursuant to the Servicing
Agreement, and upon the occurrence and continuance of any other Servicer Default
by Xxxxx Fargo, may, and at the written direction of Certificateholders
evidencing not less than 25% of the Voting Rights shall, in addition to whatever
rights the Trustee on behalf of the Certificateholders may have under Section
7.03 and at law or equity to damages, including injunctive relief and specific
performance, terminate the rights and obligations of Xxxxx Fargo under the
Servicing Agreement and in and to the related Xxxxx Fargo Mortgage Loans and
the
proceeds thereof without compensating Xxxxx Fargo for the same. On or after
the
receipt by a defaulting Servicer of such written notice, all authority and
power
of such Servicer under this Agreement or the Servicing Agreement, as applicable
whether with respect to the related Mortgage Loans or otherwise, shall pass
to
and be vested in the Master Servicer or, if Xxxxx Fargo is the defaulting
Servicer, the Trustee. Upon written request from the Master Servicer or the
Trustee, as applicable, the defaulting Servicer shall prepare, execute and
deliver, any and all documents and other instruments, place in the Trustee’s (or
its Custodian’s) possession all Mortgage Files relating to the related Mortgage
Loans, and do or accomplish all other acts or things necessary or appropriate
to
effect the purposes of such notice of termination, whether to complete the
transfer and endorsement or assignment of the related Mortgage Loans and related
documents, or otherwise, at such Servicer’s sole expense. The defaulting
Servicer shall cooperate with the Master Servicer or the Trustee, as applicable
in effecting the termination of such Servicer’s responsibilities and rights
hereunder or under the Servicing Agreement, as applicable, including, without
limitation, the transfer to such successor for administration by it of all
cash
amounts which shall at the time be credited by the defaulting Servicer to the
related Custodial Account or Escrow Account or thereafter received with respect
to the related Mortgage Loans or any related REO Property (provided, however,
that the defaulting Servicer shall continue to be entitled to receive all
amounts accrued or owing to it under this Agreement or the Servicing Agreement,
as applicable, on or prior to the date of such termination, whether in respect
of Advances, Servicing Advances, accrued and unpaid Servicing Fees or otherwise,
and shall continue to be entitled to the benefits of Section 7.04 of this
Agreement or the benefits under the Servicing Agreement, as applicable,
notwithstanding any such termination, with respect to events occurring prior
to
such termination). Neither Master Servicer nor the Trustee shall have knowledge
of a Servicer Default unless a Responsible Officer of the Master Servicer or
the
Trustee, as applicable, has actual knowledge or unless written notice of any
Servicer Default is received by the Master Servicer or the Trustee, as
applicable, at its address for notice and such notice references the
Certificates, the Trust Fund or this Agreement.
(b) In
case
one or more of the following events of default by the Master Servicer (each,
a
“Master Servicer Default”) shall occur and be continuing, that is to
say:
(i) any
failure on the part of the Master Servicer duly to observe or perform in any
material respect any other of the covenants or agreements on the part of the
Master Servicer contained in this Agreement, or the breach by the Master
Servicer of any representation and warranty contained in Section 2.03,
which continues unremedied for a period of thirty (30) days after the date
on
which written notice of such failure, requiring the same to be remedied, shall
have been given to the Master Servicer by the Depositor or the Trustee or to
the
Master Servicer, the Depositor and the Trustee by the Holders of Certificates
entitled to at least twenty-five percent (25%) of the Voting Rights;
or
(ii) a
decree
or order of a court or agency or supervisory authority having jurisdiction
in
the premises in an involuntary case under any present or future federal or
state
bankruptcy, insolvency or similar law or the appointment of a conservator or
receiver or liquidator in any insolvency, readjustment of debt, marshalling
of
assets and liabilities or similar proceeding, or for the winding-up or
liquidation of its affairs, shall have been entered against the Master Servicer
and such decree or order shall have remained in force undischarged or unstayed
for a period of sixty (60) days; or
(iii) the
Master Servicer shall consent to the appointment of a conservator or receiver
or
liquidator in any insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings of or relating to it or of or relating to
all
or substantially all of its property; or
(iv) the
Master Servicer shall admit in writing its inability to pay its debts generally
as they become due, file a petition to take advantage of any applicable
insolvency or reorganization statute, make an assignment for the benefit of
its
creditors, or voluntarily suspend payment of its obligations; or
(v) so
long
as the Trust Fund is subject to Exchange Act reporting requirements, failure
by
the Master Servicer to duly perform, within the required time period, its
obligations under Sections 3.13, 3.14, 3.18 or 5.14, which default shall not
be
subject to notice or a cure period.
If
a
Master Servicer Default shall occur, then, and in each and every such case,
so
long as such Master Servicer Default shall not have been remedied, the Depositor
or the Trustee may, and at the written direction of the Holders of Certificates
entitled to at least 51% of Voting Rights, the Trustee shall, by notice in
writing to the Master Servicer (and to the Depositor if given by the Trustee
or
to the Trustee if given by the Depositor) with a copy to each Rating Agency,
terminate all of the rights and obligations of the Master Servicer in its
capacity as Master Servicer under this Agreement, to the extent permitted by
law, and in and to the Mortgage Loans and the proceeds thereof. On or after
the
receipt by the Master Servicer of such written notice, all authority and power
of the Master Servicer under this Agreement, whether with respect to the
Certificates (other than as a Holder of any Certificate) or the Mortgage Loans
or otherwise including, without limitation, the compensation payable to the
Master Servicer under this Agreement, shall pass to and be vested in the Trustee
pursuant to and under this Section, and, without limitation, the Trustee is
hereby authorized and empowered, as attorney-in-fact or otherwise, to execute
and deliver, on behalf of and at the expense of the Master Servicer, 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. The Master Servicer agrees promptly
(and in any event no later than ten Business Days subsequent to such notice)
to
provide the Trustee with all documents and records requested by it to enable
it
to assume the Master Servicer’s functions under this Agreement, and to cooperate
with the Trustee in effecting the termination of the Master Servicer’s
responsibilities and rights under this Agreement (provided, however, that the
Master Servicer shall continue to be entitled to receive all amounts accrued
or
owing to it under this Agreement on or prior to the date of such termination
and
shall continue to be entitled to the benefits of Section 7.03,
notwithstanding any such termination, with respect to events occurring prior
to
such termination). For purposes of this Section 8.01, the Trustee shall not
be deemed to have knowledge of a Master Servicer Default unless a Responsible
Officer of the Trustee assigned to and working in the Trustee’s Corporate Trust
Office has actual knowledge thereof or unless written notice of any event which
is in fact such a Master Servicer Default is received by the Trustee and such
notice references the Certificates, the Trust or this Agreement. The Trustee
shall promptly notify the Rating Agencies of the occurrence of a Master Servicer
Default of which it has knowledge as provided above.
To
the
extent that the costs and expenses of the Trustee related to the termination
of
the Master Servicer, appointment of a successor Master Servicer or the transfer
and assumption of the master servicing by the Trustee (including, without
limitation, (i) all legal costs and expenses and all due diligence costs and
expenses associated with an evaluation of the potential termination of the
Master Servicer as a result of a Master Servicer Default and (ii) all costs
and
expenses associated with the complete transfer of the master servicing,
including all servicing files and all servicing data and the completion,
correction or manipulation of such servicing data as may be required by the
successor Master Servicer to correct any errors or insufficiencies in the
servicing data or otherwise to enable the successor Master Servicer to master
service the Mortgage Loans in accordance with this Agreement) are not fully
and
timely reimbursed by the terminated Master Servicer, the Trustee shall be
entitled to reimbursement of such costs and expenses from the Distribution
Account.
Neither
the Trustee nor any other successor master servicer shall be deemed to be in
default hereunder by reason of any failure to make, or any delay in making,
any
distribution hereunder or any portion thereof or any failure to perform, or
any
delay in performing, any duties or responsibilities hereunder, in either case
caused by the failure of the Master Servicer to deliver or provide, or any
delay
in delivering or providing, any cash, information, documents or records to
it.
Notwithstanding
the above, the Trustee may, if it shall be unwilling to continue to so act,
or
shall, if it is unable to so act, petition a court of competent jurisdiction
to
appoint, or appoint on its own behalf, any established housing and home finance
institution servicer, master servicer, servicing or mortgage servicing
institution having a net worth of not less than $15,000,000 and meeting such
other standards for a successor master servicer as are set forth in this
Agreement, as the successor to such Master Servicer in the assumption of all
of
the responsibilities, duties or liabilities of a master servicer, like the
Master Servicer.
Section
8.02 Master
Servicer to Act; Appointment of Successor.
On
and
after the time a Servicer receives a notice of termination pursuant to
Section 8.01 of this Agreement or pursuant to the Servicing Agreement, the
Master Servicer or, if Xxxxx Fargo is the defaulting Servicer, the Trustee
shall
become the successor to such Servicer with respect to the transactions set
forth
or provided for herein and after a transition period (not to exceed 90 days),
shall be subject to all the responsibilities, duties and liabilities relating
thereto placed on the terminated Servicer by the terms and provisions hereof
or
the Servicing Agreement, as applicable, and applicable law including the
obligation to make Advances pursuant to Article V hereof or the Servicing
Agreement, as applicable, except as otherwise provided herein or therein;
provided, however, that the Master Servicer’s or the Trustee’s obligation to
make Advances in its capacity as Successor Servicer shall not be subject to
such
90-day transition period and the Master Servicer or the Trustee, as applicable,
will make any Advance required to be made by the terminated Servicer on the
Distribution Date on which the terminated Servicer was required to make such
Advance. Effective on the date of such notice of termination, as compensation
therefor, the Master Servicer or the Trustee, as applicable, shall be entitled
to all fees, costs and expenses relating to the related Mortgage Loans that
the
terminated Servicer would have been entitled to if it had continued to act
hereunder or under the Servicing Agreement, as applicable, provided, however,
that neither the Master Servicer nor the Trustee shall be (i) liable for any
acts or omissions of the terminated Servicer, (ii) obligated to make Advances
if
it is prohibited from doing so under applicable law or determines that such
Advance, if made, would constitute a Nonrecoverable Advance, (iii) responsible
for expenses of the terminated Servicer pursuant to Section 2.03 of this
Agreement or pursuant to the Servicing Agreement or (iv) obligated to deposit
losses on any Permitted Investment directed by the terminated Servicer.
Notwithstanding the foregoing, the Master Servicer or the Trustee, as
applicable, may, if it shall be unwilling to so act, or shall, if it is
prohibited by applicable law from making Advances pursuant to Article VI of
this
Agreement or if it is otherwise unable to so act, appoint, or petition a court
of competent jurisdiction to appoint, any established mortgage loan servicing
institution the appointment of which does not adversely affect the then current
rating of the Certificates by each Rating Agency as the successor to the
terminated Servicer hereunder in the assumption of all or any part of the
responsibilities, duties or liabilities of the terminated Servicer hereunder
or
under the Servicing Agreement. Any Successor Servicer shall (i) be an
institution that is a Xxxxxx Xxx and Xxxxxxx Mac approved seller/servicer in
good standing, that has a net worth of at least $15,000,000 and (ii) be willing
to act as successor servicer of the related Mortgage Loans under this Agreement
or under the Servicing Agreement, and shall have executed and delivered to
the
Depositor and the Trustee an agreement accepting such delegation and assignment,
that contains an assumption by such Person of the rights, powers, duties,
responsibilities, obligations and liabilities of the terminated Servicer (other
than any liabilities of the terminated Servicer hereof incurred prior to
termination of such Servicer under Section 8.01 of this Agreement or under
the Servicing Agreement, as applicable), with like effect as if originally
named
as a party to this Agreement or under the Servicing Agreement, provided that
each Rating Agency shall have acknowledged in writing that its rating of the
Certificates in effect immediately prior to such assignment and delegation
will
not be qualified or reduced as a result of such assignment and delegation.
If
the Master Servicer or the Trustee assumes the duties and responsibilities
of
the terminated Servicer in accordance with this Section 8.02, the Master
Servicer or the Trustee, as applicable, shall not resign as servicer until
a
Successor Servicer has been appointed and has accepted such appointment. Pending
appointment of a successor to the terminated Servicer hereunder or under this
Servicing Agreement, the Master Servicer or the Trustee, as applicable, unless
such party is prohibited by law from so acting, shall act in such capacity
as
hereinabove provided. In connection with such appointment and assumption, the
Master Servicer or the Trustee, as applicable, may make such arrangements for
the compensation of such successor out of payments on the Mortgage Loans or
otherwise as it and such successor shall agree; provided that no such
compensation shall be in excess of that permitted the terminated Servicer
hereunder or under this Servicing Agreement. The Master Servicer or the Trustee,
as applicable and such successor shall take such action, consistent with this
Agreement, as shall be necessary to effectuate any such succession. Neither
the
Master Servicer nor any other Successor Servicer shall be deemed to be in
default hereunder by reason of any failure to make, or any delay in making,
any
distribution hereunder or any portion thereof or any failure to perform, or
any
delay in performing, any duties or responsibilities hereunder, in either case
caused by the failure of the terminated Servicer to deliver or provide, or
any
delay in delivering or providing, any cash, information, documents or records
to
it.
The
costs
and expenses of the Master Servicer or the Trustee, as applicable, in connection
with the termination of the terminated Servicer, appointment of a Successor
Servicer and, if applicable, any transfer of servicing, including, without
limitation, all costs and expenses associated with the complete transfer of
all
servicing data and the completion, correction or manipulation of such servicing
data as may be required by the Master Servicer or the Trustee, as applicable,
to
correct any errors or insufficiencies in the servicing data or otherwise to
enable the Master Servicer, the Trustee or the Successor Servicer to service
the
related Mortgage Loans properly and effectively, to the extent not paid by
the
terminated Servicer as may be required herein shall be payable to the Master
Servicer or the Trustee, as applicable, from the Distribution Account pursuant
to Section 3.32. Any successor to the terminated Servicer as successor
servicer under this Agreement shall give notice to the applicable Mortgagors
of
such change of servicer and shall, during the term of its service as successor
servicer maintain in force the policy or policies that the terminated Servicer
is required to maintain pursuant to Section 3.05 of this Agreement or
pursuant to the Servicing Agreement.
Notwithstanding
the foregoing, if a Servicer Default with respect to Ocwen occurs, Ocwen or
the
Servicing Rights Lender shall have a period of up to thirty (30) days after
receipt of a notice of termination to appoint a Successor Servicer that
satisfies the eligibility criteria of a Successor Servicer set forth herein,
which appointment shall be subject to the consent of the Depositor, the Sponsor,
the Master Servicer, and the Trustee, which consent shall not be unreasonably
withheld or delayed; provided that such Successor Servicer agrees to fully
effect the servicing transfer within 120 days following the termination of
Ocwen
and to make all P&I Advances that would otherwise be made by the Master
Servicer under Section 8.01 as of the date of such appointment, and to reimburse
the Master Servicer for any xxxxxxxxxxxx X&X Advances they have made and any
reimbursable expenses that they may have incurred in connection with this
Section 8.02. Any proceeds received in connection with the appointment of such
Successor Servicer shall be the property of Ocwen or its designee. This 30-day
period shall terminate immediately (i) at the close of business on the second
Business Day of such 30-day period if (A) Ocwen was terminated because of an
Event of Default described in Section 8.01(a)(I)(i) for failing to make a
required Advance pursuant to section 5.01, and (B) Ocwen shall have failed
to
make (or cause to be made) such Advance, or shall fail to reimburse (or cause
to
be reimbursed) the Master Servicer for an Advance made by the Master Servicer,
by the close of business on such second Business Day, or (ii) at the close
of
business on the second Business Day following the date (if any) during such
30-day period on which an Advance is due to be made, if Ocwen shall have failed
to make (or caused to be made) such Advance, or Ocwen shall have failed to
reimburse (or cause to be reimbursed) the Master Servicer for such Advance,
by
the close of business on such second Business Day; provided, that such 30-day
period shall only be terminated to the extent that the Lender has received
notice of such failure from the Master Servicer and the Lender has not cured
or
caused the cure of such failure within two (2) Business Days following receipt
of notice, provided, however, that such notice requirement shall only be
applicable to the extent that the Master Servicer has been provided with the
written address and contact information for the Lender.
Notwithstanding
anything herein to the contrary, in no event shall the Trustee be liable for
any
Master Servicing Fee or Servicing Fee or for any differential in the amount
of
the Master Servicing Fee or Servicing Fee paid hereunder or under the Servicing
Agreement, as applicable, and the amount necessary to induce any successor
master servicer or successor servicer to act as successor master servicer or
successor servicer under this Agreement or the Servicing Agreement, as
applicable, and the transactions set forth or provided for herein.
Section
8.03 Notification
to Certificateholders.
(a) Upon
any
termination of or appointment of a successor to a Servicer or the Master
Servicer, the Trustee shall give prompt written notice thereof to
Certificateholders and to each Rating Agency.
(b) Within
sixty (60) days after the occurrence of any Servicer Default or Master Servicer
Default, the Trustee shall transmit by mail to all Certificateholders notice
of
each such Servicer Default or Master Servicer Default hereunder known to the
Trustee, unless such default shall have been cured or waived.
Section
8.04 Waiver
of Servicer Defaults and Master Servicer Defaults.
The
Trustee may waive only by written notice from Certificateholders evidencing
66-2/3% of the Voting Rights (unless such default materially and adversely
affects all Certificateholders, in which case the written direction shall be
from all of the Certificateholders) any default by a Servicer or the Master
Servicer in the performance of its obligations hereunder or under the Servicing
Agreement and its consequences. Upon any such waiver of a past default, such
default shall cease to exist, and any Servicer Default or the Master Servicer
Default arising therefrom shall be deemed to have been remedied for every
purpose of this Agreement. No such waiver shall extend to any subsequent or
other default or impair any right consequent thereon except to the extent
expressly so waived in writing.
ARTICLE
IX
CONCERNING
THE TRUSTEE AND SECURITIES ADMINISTRATOR
Section
9.01 Duties
of Trustee and Securities Administrator.
(a) The
Trustee, prior to the occurrence of a Master Servicer Default, and after the
curing or waiver of all Master Servicer Defaults, which may have occurred,
and
the Securities Administrator each undertake to perform such duties and only
such
duties as are specifically set forth in this Agreement as duties of the Trustee
and the Securities Administrator, respectively. If a Master Servicer Default
has
occurred and has not 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. Any
permissive right of the Trustee enumerated in this Agreement shall not be
construed as a duty.
(b) Each
of
the Trustee and the Securities Administrator, upon receipt of all resolutions,
certificates, statements, opinions, reports, documents, orders or other
instruments furnished to it, which are specifically required to be furnished
pursuant to any provision of this Agreement, shall examine them to determine
whether they conform to the requirements of this Agreement. If any such
instrument is found not to conform to the requirements of this Agreement in
a
material manner, the Trustee or the Securities Administrator, as the case may
be, shall take such action as it deems appropriate to have the instrument
corrected, and if the instrument is not corrected to its satisfaction, the
Securities Administrator will provide notice to the Trustee thereof and the
Trustee will provide notice to the Certificateholders.
(c) The
Trustee shall promptly remit to the related Servicer any complaint, claim,
demand, notice or other document (collectively, the “Notices”) delivered to the
Trustee as a consequence of the assignment of any Mortgage Loan hereunder and
relating to the servicing of the Mortgage Loans; provided than any such notice
(i) is delivered to the Trustee at its Corporate Trust Office, (ii) contains
information sufficient to permit the Trustee to make a determination that the
real property to which such document relates is a Mortgaged Property. The
Trustee shall have no duty hereunder with respect to any Notice it may receive
or which may be alleged to have been delivered to or served upon it unless
such
Notice is delivered to it or served upon it at its Corporate Trust Office and
such Notice contains the information required pursuant to clause (ii) of the
preceding sentence.
(d)
No
provision of this Agreement shall be construed to relieve the Trustee or the
Securities Administrator from liability for its own negligent action, its own
negligent failure to act or its own misconduct; provided, however,
that:
(i) Prior
to
the occurrence of a Master Servicer Default and after the curing or waiver
of
all such Master Servicer Defaults which may have occurred with respect to the
Trustee and at all times with respect to the Securities Administrator, the
duties and obligations of the Trustee and the Securities Administrator shall
be
determined solely by the express provisions of this Agreement, neither the
Trustee nor the Securities Administrator shall be liable except for the
performance of its duties and obligations as are specifically set forth in
this
Agreement, no implied covenants or obligations shall be read into this Agreement
against the Trustee or the Securities Administrator and, in the absence of
bad
faith on the part of the Trustee or the Securities Administrator, respectively,
the Trustee or the Securities Administrator, respectively, may conclusively
rely
and shall be fully protected in acting or refraining from acting, as to the
truth of the statements and the correctness of the opinions expressed therein,
upon any certificates or opinions furnished to the Trustee or the Securities
Administrator, respectively, that conform to the requirements of this
Agreement;
(ii) Neither
the Trustee nor the Securities Administrator shall be liable in its individual
capacity for an error of judgment made in good faith by a Responsible Officer
or
Responsible Officers of the Trustee or an officer or officers of the Securities
Administrator, respectively, unless it shall be proved that the Trustee or
Securities Administrator, respectively, was negligent in ascertaining the
pertinent facts;
(iii) Neither
the Trustee nor the Securities Administrator shall be liable with respect to
any
action taken, suffered or omitted to be taken by it in good faith and believed
by it to be authorized or within the rights or powers conferred upon it by
this
Agreement or in accordance with the directions of the Holders of Certificates
evidencing not less than 25% of the aggregate Voting Rights of the Certificates,
if such action or non-action relates to the time, method and place of conducting
any proceeding for any remedy available to the Trustee or the Securities
Administrator or exercising any trust or other power conferred upon the Trustee
or the Securities Administrator under this Agreement;
(iv) The
Trustee shall not be required to take notice or be deemed to have notice or
knowledge of any default or Master Servicer Default unless a Responsible Officer
of the Trustee shall have actual knowledge thereof. In the absence of such
notice, the Trustee may conclusively assume there is no such default or Master
Servicer Default;
(v) The
Trustee shall not in any way be liable by reason of any insufficiency in any
Account held by or in the name of Trustee unless it is determined by a court
of
competent jurisdiction that the Trustee’s gross negligence or willful misconduct
was the primary cause of such insufficiency (except to the extent that the
Trustee is obligor and has defaulted thereon);
(vi) Anything
in this Agreement to the contrary notwithstanding, in no event shall the Trustee
or the Securities Administrator be liable for special, indirect, punitive or
consequential loss or damage of any kind whatsoever (including but not limited
to lost profits), even if the Trustee or the Securities Administrator has been
advised of the likelihood of such loss or damage and regardless of the form
of
action and whether or not any such damages were foreseeable or contemplated;
and
(vii) None
of
the Sponsor, the Depositor or the Trustee shall be responsible for the acts
or
omissions of the other, it being understood that this Agreement shall not be
construed to render them partners, joint venturers or agents of one
another.
Neither
the Trustee (regardless of the capacity in which it is acting) nor the
Securities Administrator shall be required to expend or risk its own funds
or
otherwise incur liability, financial or otherwise, in the performance of any
of
its duties hereunder, or in the exercise of any of its rights or powers, if
there is reasonable ground for believing that the repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured
to
it, and none of the provisions contained in this Agreement shall in any event
require the Trustee or the Securities Administrator to perform, or be
responsible for the manner of performance of, any of the obligations of the
terminated Servicer hereunder.
(e) All
funds
received by the Securities Administrator and required to be deposited in the
Distribution Account pursuant to this Agreement will be promptly so deposited
by
the Securities Administrator.
Section
9.02 Certain
Matters Affecting the Trustee and Securities Administrator.
(a) Except
as
otherwise provided in Section 9.01:
(i) The
Trustee and the Securities Administrator may conclusively rely and shall be
fully protected in acting or refraining from acting in reliance on any
resolution or certificate of the Sponsor, the Depositor or the Servicers, any
certificates of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond or other
paper
or document believed by it to be genuine and to have been signed or presented
by
the proper party or parties;
(ii) The
Trustee and the Securities Administrator may consult with counsel and any advice
of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection with respect to any action taken or suffered or
omitted by it hereunder in good faith and in accordance with such advice or
Opinion of Counsel:
(iii) Neither
the Trustee nor the Securities Administrator shall be under any obligation
to
exercise any of the trusts or powers vested in it by this Agreement, other
than
its obligation to give notices pursuant to this Agreement, or to institute,
conduct or defend any litigation hereunder or in relation hereto at the request,
order or direction of any of the Certificateholders pursuant to the provisions
of this Agreement, unless such Certificateholders shall have offered to the
Trustee or the Securities Administrator, as the case may be, reasonable security
or indemnity satisfactory to it against the costs, expenses and liabilities
which may be incurred therein or thereby. Nothing contained herein shall,
however, relieve the Trustee of the obligation, upon the occurrence of a Master
Servicer Default of which a Responsible Officer of the Trustee has actual
knowledge (which has not been cured or waived), to exercise such of the rights
and powers vested in it by this Agreement, and to use the same degree of care
and skill in their exercise, as a prudent person would exercise or use under
the
circumstances in the conduct of his own affairs;
(iv) Neither
the Trustee nor the Securities Administrator shall be liable in its individual
capacity for any action taken, suffered or omitted by it in good faith and
believed by it to be authorized or within the discretion or rights or powers
conferred upon it by this Agreement;
(v) Prior
to
the occurrence of a Master Servicer Default hereunder and after the curing
or
waiver of all Master Servicer Defaults which may have occurred with respect
to
the Trustee and at all times with respect to the Securities Administrator,
neither the Trustee nor the Securities Administrator shall be bound to make
any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond or other paper or document, unless requested in writing to do
so
by Holders of Certificates evidencing not less than twenty-five percent (25%)
of
the aggregate Voting Rights of the Certificates and provided that the payment
within a reasonable time to the Trustee or the Securities Administrator of
the
costs, expenses or liabilities likely to be incurred by it in the making of
such
investigation is, in the opinion of the Trustee or the Securities Administrator,
as applicable, not reasonably assured to the Trustee or the Securities
Administrator, as applicable, by the security afforded to it by the terms of
this Agreement, the Trustee or the Securities Administrator, as applicable,
may
require reasonable indemnity against such expense or liability as a condition
to
taking any such action. The reasonable expense of every such examination shall
be paid by the Certificateholders requesting the investigation;
(vi) The
Trustee may execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or through Affiliates, nominees, custodians, agents
or
attorneys. The Trustee shall not be liable or responsible for the misconduct
or
negligence of any of the Trustee’s agents or attorneys or paying agent appointed
hereunder by the Trustee with due care;
(vii) Should
the Trustee deem the nature of any action required on its part to be unclear,
the Trustee may require prior to such action that it be provided by the
Depositor with reasonable further instructions; the right of the Trustee to
perform any discretionary act enumerated in this Agreement shall not be
construed as a duty, and the Trustee shall not be accountable for other than
its
gross negligence or willful misconduct in the performance of any such
act;
(viii) The
Trustee shall not be required to give any bond or surety with respect to the
execution of the trust created hereby or the powers granted
hereunder;
(ix) The
Trustee shall not have any duty to conduct any affirmative investigation as
to
the occurrence of any condition requiring the repurchase of any Mortgage Loan
by
any Person pursuant to this Agreement, or the eligibility of any Mortgage Loan
for purposes of this Agreement;
(x) 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 or served upon it by the parties as a consequence of the
assignment of any Mortgage Loan hereunder; provided, however that the Trustee
shall promptly remit to the Servicer upon receipt any such complaint, claim,
demand, notice or other document (i) which is delivered to the Trustee at is
Corporate Trust Office, (ii) of which a Responsible Officer has actual knowledge
and (iii) which contains information sufficient to permit the Trustee to make
a
determination that the real property to which such document relates is a
Mortgaged Property;
(xi) The
Trustee, not in its individual capacity but solely in its separate capacity
as
Supplemental Interest Trust Trustee, is hereby directed to execute and deliver
the Basis Risk Cap Agreement, Interest Rate Cap Agreement and the Swap Agreement
on behalf of Party B (as defined therein) and to exercise the rights, perform
the obligations, and make the representations of Party B thereunder, solely
in
its capacity as Supplemental Interest Trust Trustee on behalf of Party B (as
defined therein) and not in its individual capacity.
The
Certificateholders (by acceptance of their Certificates) acknowledge and agree
that:
(a)
the
Supplemental Interest Trust Trustee shall execute and deliver the Basis Risk
Cap
Agreement, Interest Rate Cap Agreement and the Swap Agreement on behalf of
Party
B (as defined therein),
(b)
the
Supplemental Interest Trust Trustee shall exercise the rights, perform the
obligations, and make the representations of Party B thereunder, solely in
its
capacity as Supplemental Interest Trust Trustee on behalf of Party B (as defined
therein) and not in its individual capacity, and
(c)
the
Securities Administrator shall also be entitled to exercise the rights and
obligated to perform the obligations of Party B under the Basis Risk Cap
Agreement, Interest Rate Cap Agreement and the Swap Agreement.
Every
provision of this Agreement relating to the conduct or affecting the liability
of or affording protection to the Trustee shall apply to the Trustee’s
execution, as Supplemental Interest Trust Trustee of the Basis Risk Cap
Agreement, Interest Rate Cap Agreement and the Swap Agreement, and the
performance of its duties and satisfaction of its obligations
thereunder.
Every
provision of this Agreement relating to the conduct or affecting the liability
of or affording protection to the Securities Administrator shall apply to the
Securities Administrator’s performance of its duties and satisfaction of its
obligations under the Basis Risk Cap Agreement, Interest Rate Cap Agreement
and
the Swap Agreement.
(xii) None
of
the Securities Administrator, the Master Servicer, the Servicer, the Sponsor,
the Depositor, the Custodian or the Trustee shall be responsible for the acts
or
omissions of the others or of the Basis Risk Cap Provider, the Swap Provider
or
the Interest Rate Swap Provider, it being understood that this Agreement shall
not be construed to render them partners, joint venturers or agents of one
another; and
(xiii) The
permissive rights of the Trustee enumerated herein shall not be construed as
duties.
| Section 9.03 |
Trustee
and Securities Administrator not Liable for Certificates or Mortgage
Loans.
|
The
recitals contained herein and in the Certificates (other than the signature
of
the Securities Administrator, the authentication of the Securities Administrator
on the Certificates, the acknowledgements of the Trustee contained in Article
II
and the representations and warranties of the Trustee in Section 9.12)
shall be taken as the statements of the Depositor, and neither the Trustee
nor
the Securities Administrator assumes any responsibility for their correctness.
Neither the Trustee nor the Securities Administrator makes any representations
or warranties as to the validity or sufficiency of this Agreement (other than
as
specifically set forth in Section 9.12) of the Basis Risk Cap Agreement,
the Swap Agreement, the Interest Rate Cap Agreement, the Certificates (other
than the signature of the Securities Administrator and authentication of the
Securities Administrator on the Certificates) or of any Mortgage Loan except
as
expressly provided in Section 2.02. The Securities Administrator’s signature and
authentication (or authentication of its agent) on the Certificates shall be
solely in its capacity as Securities Administrator and shall not constitute
the
Certificates an obligation of the Securities Administrator in any other
capacity. The Trustee and the Securities Administrator shall not be accountable
for the use or application by the Depositor of any of the Certificates or of
the
proceeds of such Certificates, or for the use or application of any funds paid
to the Depositor with respect to the Mortgage Loans.
| Section 9.04 |
Trustee
and Securities Administrator May Own Certificates.
|
Each
of
the Trustee and the Securities Administrator in its individual capacity or
in
any other capacity other than as Trustee or Securities Administrator hereunder
may become the owner or pledgee of any Certificates and may transact business
with other interested parties and their Affiliates with the same rights it
would
have if it were not the Trustee or the Securities Administrator.
| Section 9.05 |
Fees
and Expenses of Trustee and Securities Administrator.
|
The
fees
of the Trustee, the Credit Risk Manager and the Securities Administrator
hereunder shall be paid in accordance with a side letter agreement with the
Master Servicer and at the sole expense of the Master Servicer. In addition,
the
Trustee, the Securities Administrator, the Custodian and any director, officer,
employee or agent of the Trustee, the Securities Administrator and the Custodian
shall be indemnified by the Trust and held harmless against any loss, liability
or expense (including reasonable attorney’s fees and expenses) incurred by the
Trustee, the Custodian or the Securities Administrator including any pending
or
threatened claim or legal action arising out of or in connection with the
acceptance or administration of its respective obligations and duties under
this
Agreement, including the Basis Risk Cap Agreement, the Swap Agreement, the
Interest Rate Cap Agreement and any and all other agreements related hereto,
other than any loss, liability or expense (i) for which the Trustee is
indemnified by the Master Servicer or the related Servicer, (ii) that
constitutes a specific liability of the Trustee or the Securities Administrator
pursuant to this Agreement or (iii) any loss, liability or expense incurred
by
reason of willful misfeasance, bad faith or negligence in the performance of
duties hereunder by the Trustee or the Securities Administrator or by reason
of
reckless disregard of obligations and duties hereunder. In no event shall the
Trustee or the Securities Administrator be liable for special, indirect or
consequential loss or damage of any kind whatsoever (including but not limited
to lost profits), even if it has been advised of the likelihood of such loss
or
damage and regardless of the form of action. The Master Servicer agrees to
indemnify the Trustee, from, and hold the Trustee harmless against, any loss,
liability or expense (including reasonable attorney’s fees and expenses)
incurred by the Trustee by reason of the Master Servicer’s willful misfeasance,
bad faith or gross negligence in the performance of its duties under this
Agreement or by reason of the Master Servicer’s reckless disregard of its
obligations and duties under this Agreement. The indemnities in this
Section 9.05 shall survive the termination or discharge of this Agreement
and the resignation or removal of the Master Servicer, the Trustee, the
Securities Administrator or the Custodian. Any payment hereunder made by the
Master Servicer to the Trustee shall be from the Master Servicer’s own funds,
without reimbursement from REMIC I therefor.
| Section 9.06 |
Eligibility
Requirements for Trustee and Securities Administrator.
|
The
Trustee and the Securities Administrator shall at all times be a corporation
or
an association (other than the Depositor, the Sponsor or any Affiliate of the
foregoing) 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 at least $50,000,000 (or a
member of a bank holding company whose capital and surplus is at least
$50,000,000) and subject to supervision or examination by federal or state
authority. If such corporation or association publishes reports of conditions
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 association
shall be deemed to be its combined capital and surplus as set forth in its
most
recent report of conditions so published. In case at any time the Trustee or
the
Securities Administrator, as applicable, shall cease to be eligible in
accordance with the provisions of this Section, the Trustee or the Securities
Administrator, as applicable, shall resign immediately in the manner and with
the effect specified in Section 9.07.
Additionally,
the Securities Administrator (i) may not be an originator, Master Servicer,
Servicer, Depositor or an affiliate of the Depositor unless the Securities
Administrator is in an institutional trust department, (ii) must be authorized
to exercise corporate trust powers under the laws of its jurisdiction of
organization, and (iii) must be rated at least "A/F1" by Fitch, if Fitch is
a
Rating Agency, or rated at least "A-1" by S&P (or such rating acceptable to
Fitch pursuant to a rating confirmation). Xxxxx Fargo Bank, N.A. shall act
as
Securities Administrator for so long as it is Master Servicer under this
Agreement.
| Section 9.07 |
Resignation
and Removal of Trustee and Securities Administrator.
|
The
Trustee and the Securities Administrator may at any time resign (including,
without limitation, and in the case of the Securities Administrator, upon the
resignation or removal of the Master Servicer) and be discharged from the trust
hereby created by giving written notice thereof to the Depositor, to the Master
Servicer, to the Securities Administrator (or the Trustee, if the Securities
Administrator resigns) and to the Certificateholders. Upon receiving such notice
of resignation, the Depositor shall promptly appoint a successor trustee or
successor securities administrator by written instrument, in duplicate, which
instrument shall be delivered to the resigning Trustee or Securities
Administrator, as applicable, and to the successor trustee or successor
securities administrator, as applicable. A copy of such instrument shall be
delivered to the Certificateholders, the Trustee, the Securities Administrator
and the Master Servicer by the Depositor. If no successor trustee or successor
securities administrator shall have been so appointed and have accepted
appointment within thirty (30) days after the giving of such notice of
resignation, the resigning Trustee or Securities Administrator, as the case
may
be, may, at the expense of the Trust Fund, petition any court of competent
jurisdiction for the appointment of a successor trustee or successor securities
administrator, as applicable.
If
at any
time the Trustee or the Securities Administrator shall cease to be eligible
in
accordance with the provisions of Section 9.06 and shall fail to resign
after written request therefor by the Depositor, or if at any time the Trustee
or the Securities Administrator shall become incapable of acting, or shall
be
adjudged bankrupt or insolvent, or a receiver of the Trustee or the Securities
Administrator or of its property shall be appointed, or any public officer
shall
take charge or control of the Trustee or the Securities Administrator or of
its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, then the Depositor may remove the Trustee or the Securities
Administrator, as applicable and appoint a successor trustee or successor
securities administrator, as applicable, by written instrument, in duplicate,
which instrument shall be delivered to the Trustee or the Securities
Administrator so removed and to the successor trustee or successor securities
administrator. A copy of such instrument shall be delivered to the
Certificateholders, the Trustee, the Securities Administrator and the Master
Servicer by the Depositor.
The
Holders of Certificates entitled to at least 51% of the Voting Rights may at
any
time remove the Trustee or the Securities Administrator and appoint a successor
trustee or successor securities administrator by written instrument or
instruments, in triplicate, signed by such Holders or their attorneys-in-fact
duly authorized, one complete set of which instruments shall be delivered to
the
Depositor, one complete set to the Trustee or the Securities Administrator
so
removed and one complete set to the successor so appointed. A copy of such
instrument shall be delivered to the Certificateholders, the Trustee (in the
case of the removal of the Securities Administrator), the Securities
Administrator (in the case of the removal of the Trustee) and the Master
Servicer by the Depositor.
Any
resignation or removal of the Trustee or the Securities Administrator and
appointment of a successor trustee or successor securities administrator
pursuant to any of the provisions of this Section shall not become
effective until acceptance of appointment by the successor trustee or successor
securities administrator, as applicable, as provided in
Section 9.08.
Notwithstanding
anything to the contrary contained herein, the Master Servicer and the
Securities Administrator shall at all times be the same Person.
| Section 9.08 |
Successor
Trustee or Securities Administrator.
|
Any
successor trustee or successor securities administrator appointed as provided
in
Section 9.07 hereof shall execute, acknowledge and deliver to the Depositor
and to its predecessor trustee or predecessor securities administrator
instrument accepting such appointment hereunder and thereupon the resignation
or
removal of the predecessor trustee or predecessor securities administrator
shall
become effective and such successor trustee or successor securities
administrator, without any further act, deed or conveyance, shall become fully
vested with all the rights, powers, duties and obligations of its predecessor
hereunder, with the like effect as if originally named as trustee or Securities
Administrator herein. The predecessor trustee or predecessor securities
administrator shall deliver to the successor trustee or successor securities
administrator all Mortgage Loan Documents and related documents and statements
to the extent held by it hereunder, as well as all monies, held by it hereunder,
and the Depositor and the predecessor trustee or predecessor securities
administrator shall execute and deliver such instruments and do such other
things as may reasonably be required for more fully and certainly vesting and
confirming in the successor trustee or successor securities administrator all
such rights, powers, duties and obligations.
No
successor trustee or successor securities administrator shall accept appointment
as provided in this Section 9.08 unless at the time of such acceptance such
successor trustee or successor securities administrator shall be eligible under
the provisions of Section 9.07 hereof and its appointment shall not
adversely affect the then current rating of the Certificates.
Upon
acceptance of appointment by a successor trustee or successor securities
administrator as provided in this Section 9.08, the successor trustee or
successor securities administrator shall mail notice of the succession of such
trustee or securities administrator hereunder to all Holders of Certificates.
If
the successor trustee or successor securities administrator fails to mail such
notice within ten days after acceptance of appointment, the Depositor shall
cause such notice to be mailed at the expense of the Trust Fund.
Any
Person appointed as successor trustee pursuant to Section 9.08 shall also be
required to serve as successor supplemental interest trust trustee under the
Swap Agreement, the Basis Risk Cap Agreement, and Interest Rate Cap
Agreement.
| Section 9.09 |
Merger
or Consolidation of Trustee or Securities Administrator.
|
Any
corporation, state bank or national banking association into which the Trustee
or Securities Administrator may be merged or converted or with which it may
be
consolidated or any corporation, state bank or national banking association
resulting from any merger, conversion or consolidation to which the Trustee
or
the Securities Administrator shall be a party, or any corporation, state bank
or
national banking association succeeding to substantially all of the corporate
trust business of the Trustee or Securities Administrator shall be the successor
of the Trustee or Securities Administrator hereunder, provided that such
corporation shall be eligible under the provisions of Section 9.06 without
the execution or filing of any paper or further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding.
| Section 9.10 |
Appointment
of Co-Trustee or Separate Trustee.
|
Notwithstanding
any other provisions hereof, at any time, for the purpose of meeting any legal
requirements of any jurisdiction in which any part of the REMIC I or property
securing the same may at the time be located, the Trustee shall have the power
and shall execute and deliver all instruments to appoint one or more Persons
approved by the Trustee to act as co-trustee or co-trustees, jointly with the
Trustee, or separate trustee or separate trustees, of all or any part of REMIC
I, and to vest in such Person or Persons, in such capacity, and for the benefit
of the Holders of the Certificates, such title to REMIC I, or any part thereof,
and, subject to the other provisions of this Section 9.10, such powers,
duties, obligations, rights and trusts as the Trustee may consider necessary
or
desirable. No co-trustee or separate trustee hereunder shall be required to
meet
the terms of eligibility as a successor trustee under Section 9.06
hereunder and no notice to Holders of Certificates of the appointment of
co-trustee(s) or separate trustee(s) shall be required under Section 9.08
hereof.
In
the
case of any appointment of a co-trustee or separate trustee pursuant to this
Section 9.10 all rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred or imposed upon and exercised or
performed by the Trustee and such separate trustee or co-trustee jointly, except
to the extent that under any law of any jurisdiction in which any particular
act
or acts are to be performed by the Trustee (whether as Trustee hereunder or
as
successor to a defaulting Master Servicer hereunder), the Trustee shall be
incompetent or unqualified to perform such act or acts, in which event such
rights, powers, duties and obligations (including the holding of title to REMIC
I or any portion thereof in any such jurisdiction) shall be exercised and
performed by such separate trustee or co-trustee at the direction of the
Trustee.
Any
notice, request or other writing given to the Trustee shall be deemed to have
been given to each of the then separate trustees and co-trustees, as effectively
as if given to each of them. Every instrument appointing any separate trustee
or
co-trustee shall refer to this Agreement and the conditions of this Article
IX.
Each separate trustee and co-trustee, upon its acceptance of the trust
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.
Any
separate trustee or co-trustee may, at any time, constitute the Trustee, its
agent or attorney-in-fact, with full power and authority, to the extent not
prohibited by law, to do any lawful act under or in respect of this Agreement
on
its behalf and in its name. If any separate trustee or co-trustee shall die,
become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee or co-trustee.
| Section 9.11 |
Appointment
of Office or Agency.
|
The
Certificates may be surrendered for registration of transfer or exchange at
the
Securities Administrator’s office initially located at Xxxxx Xxxxxx xxx
Xxxxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000, and presented for final
distribution at the Corporate Trust Office of the Securities Administrator
where
notices and demands to or upon the Securities Administrator in respect of the
Certificates and this Agreement may be served.
| Section 9.12 |
Representations
and Warranties.
|
The
Trustee hereby represents and warrants to the Master Servicer, the Securities
Administrator, the Servicers and the Depositor as applicable, as of the Closing
Date, that:
(i) It
is a
national banking association duly organized, validly existing and in good
standing under the laws of the United States of America.
(ii) The
execution and delivery of this Agreement by it, and the performance and
compliance with the terms of this Agreement by it, will not violate its articles
of association or bylaws or constitute a default (or an event which, with notice
or lapse of time, or both, would constitute a default) under, or result in
the
breach of, any material agreement or other instrument to which it is a party
or
which is applicable to it or any of its assets.
(iii) It
has
the full power and authority to enter into and consummate all transactions
contemplated by this Agreement, has duly authorized the execution, delivery
and
performance of this Agreement, and has duly executed and delivered this
Agreement.
(iv) This
Agreement, assuming due authorization, execution and delivery by the other
parties hereto, constitutes a valid, legal and binding obligation of it,
enforceable against it in accordance with the terms hereof, subject to (A)
applicable bankruptcy, insolvency, receivership, reorganization, moratorium
and
other laws affecting the enforcement of creditors’ rights generally, and (B)
general principles of equity, regardless of whether such enforcement is
considered in a proceeding in equity or at law.
(v) It
is not
in violation of, and its execution and delivery of this Agreement and its
performance and compliance with the terms of this Agreement will not constitute
a violation of, any law, any order or decree of any court or arbiter, or any
order, regulation or demand of any federal, state or local governmental or
regulatory authority, which violation, in its good faith and reasonable
judgment, is likely to affect materially and adversely either the ability of
it
to perform its obligations under this Agreement or its financial
condition.
No
litigation is pending or, to the best of its knowledge, threatened against
it,
which would prohibit it from entering into this Agreement or, in its good faith
reasonable judgment, is likely to materially and adversely affect either the
ability of it to perform its obligations under this Agreement or its financial
condition.
| Section 9.13 |
Tax
Matters.
|
It
is
intended that the Trust Fund shall constitute, and that the affairs of the
Trust
Fund shall be conducted so that each REMIC formed hereunder qualifies as, a
“real estate mortgage investment conduit” as defined in and in accordance with
the REMIC Provisions. In furtherance of such intention, the Securities
Administrator covenants and agrees that it shall act as agent (and the
Securities Administrator is hereby appointed to act as agent) on behalf of
the
Trust Fund. The Securities Administrator, as agent on behalf of the Trust Fund,
shall do or refrain from doing, as applicable, the following: (a) the Securities
Administrator shall prepare and file, or cause to be prepared and filed, in
a
timely manner, U.S. Real Estate Mortgage Investment Conduit Income Tax Returns
(Form 1066 or any successor form adopted by the Internal Revenue Service) and
prepare and file or cause to be prepared and filed with the Internal Revenue
Service and applicable state or local tax authorities income tax or information
returns for each taxable year with respect to each such REMIC containing such
information and at the times and in the manner as may be required by the Code
or
state or local tax laws, regulations, or rules, and furnish or cause to be
furnished to Certificateholders the schedules, statements or information at
such
times and in such manner as may be required thereby; (b) the Securities
Administrator shall apply for an employer identification number with the
Internal Revenue Service via a Form SS-4 or other comparable method for each
REMIC that is or becomes a taxable entity, and within thirty days of the Closing
Date, furnish or cause to be furnished to the Internal Revenue Service, on
Forms
8811 or as otherwise may be required by the Code, the name, title, address,
and
telephone number of the person that the holders of the Certificates may contact
for tax information relating thereto, together with such additional information
as may be required by such Form, and update such information at the time or
times in the manner required by the Code for the Trust Fund; (c) the Securities
Administrator shall make or cause to be made elections, on behalf of each REMIC
formed hereunder to be treated as a REMIC on the federal tax return of such
REMIC for its first taxable year (and, if necessary, under applicable state
law); (d) the Securities Administrator shall prepare and forward, or cause
to be
prepared and forwarded, to the Certificateholders and to the Internal Revenue
Service and, if necessary, state tax authorities, all information returns and
reports as and when required to be provided to them in accordance with the
REMIC
Provisions, including without limitation, the calculation of any original issue
discount using the Prepayment Assumption; (e) the Securities Administrator
shall
provide information necessary for the computation of tax imposed on the transfer
of a Residual Certificate to a Person that is not a Permitted Transferee, or
an
agent (including a broker, nominee or other middleman) of a Person that is
not a
Permitted Transferee, or a pass-through entity in which a Person that is not
a
Permitted Transferee is the record holder of an interest (the reasonable cost
of
computing and furnishing such information may be charged to the Person liable
for such tax); (f) the Securities Administrator shall, to the extent under
its
control, conduct the affairs of the Trust Fund at all times that any
Certificates are outstanding so as to maintain the status of each REMIC formed
hereunder as a REMIC under the REMIC Provisions; (g) the Securities
Administrator shall not knowingly or intentionally take any action or omit
to
take any action that would cause the termination of the REMIC status of any
REMIC formed hereunder; (h) the Securities Administrator shall pay, from the
sources specified in the last paragraph of this Section 9.13, the amount of
any federal, state and local taxes, including prohibited transaction taxes
as
described below, imposed on any REMIC formed hereunder prior to the termination
of the Trust Fund when and as the same shall be due and payable (but such
obligation shall not prevent the Securities Administrator or any other
appropriate Person from contesting any such tax in appropriate proceedings
and
shall not prevent the Securities Administrator from withholding payment of
such
tax, if permitted by law, pending the outcome of such proceedings); (i) the
Trustee shall sign or cause to be signed federal, state or local income tax
or
information returns or any other document prepared by the Securities
Administrator pursuant to this Section 9.13 requiring a signature thereon
by the Trustee; (j) the Securities Administrator shall maintain records relating
to each REMIC formed hereunder including but not limited to the income,
expenses, assets and liabilities of each such REMIC and adjusted basis of the
Trust Fund property determined at such intervals as may be required by the
Code,
as may be necessary to prepare the foregoing returns, schedules, statements
or
information; (k) the Securities Administrator shall, for federal income tax
purposes, maintain books and records with respect to the REMICs on a calendar
year and on an accrual basis; (l) the Securities Administrator shall not enter
into any arrangement not otherwise provided for in this Agreement by which
the
REMICs will receive a fee or other compensation for services nor permit the
REMICs to receive any income from assets other than “qualified mortgages” as
defined in Section 860G(a)(3) of the Code or “permitted investments” as
defined in Section 860G(a)(5) of the Code; and (m) as and when necessary
and appropriate, the Securities Administrator shall represent the Trust Fund
in
any administrative or judicial proceedings relating to an examination or audit
by any governmental taxing authority, request an administrative adjustment
as to
any taxable year of any REMIC formed hereunder, enter into settlement agreements
with any governmental taxing agency, extend any statute of limitations relating
to any tax item of the Trust Fund, and otherwise act on behalf of each REMIC
formed hereunder in relation to any tax matter involving any such
REMIC.
In
order
to enable the Securities Administrator to perform its duties as set forth
herein, the Depositor shall provide, or cause to be provided, to the Securities
Administrator within 10 days after the Closing Date all information or data
that
the Securities Administrator requests in writing and determines to be relevant
for tax purposes to the valuations and offering prices of the Certificates,
including, without limitation, the price, yield, prepayment assumption and
projected cash flows of the Certificates and the Mortgage Loans. Thereafter,
the
Depositor shall provide to the Securities Administrator promptly upon written
request therefor, any such additional information or data that the Securities
Administrator may, from time to time, request in order to enable the Securities
Administrator to perform its duties as set forth herein. The Depositor hereby
indemnifies the Securities Administrator for any losses, liabilities, damages,
claims or expenses of the Securities Administrator arising from any errors
or
miscalculations of the Securities Administrator that result from any failure
of
the Depositor to provide, or to cause to be provided, accurate information
or
data to the Securities Administrator on a timely basis.
In
the
event that any tax is imposed on “prohibited transactions” of any of REMIC as
defined in Section 860F(a)(2) of the Code, on the “net income from
foreclosure property” of the Trust Fund as defined in Section 860G(c) of
the Code, on any contribution to any of REMIC after the startup day pursuant
to
Section 860G(d) of the Code, or any other tax is imposed, including,
without limitation, any federal, state or local tax or minimum tax imposed
upon
any REMIC, and is not paid as otherwise provided for herein, such tax shall
be
paid by (i) the Securities Administrator, if any such other tax arises out
of or
results from a breach by the Securities Administrator of any of its obligations
under this Section, (ii) any party hereto (other than the Securities
Administrator) to the extent any such other tax arises out of or results from
a
breach by such other party of any of its obligations under this Agreement or
(iii) in all other cases, or in the event that any liable party hereto fails
to
honor its obligations under the preceding clauses (i) or (ii), any such tax
will
be paid first with amounts otherwise to be distributed to the Class R
Certificateholders, and second with amounts otherwise to be distributed to
all
other Certificateholders in the following order of priority: first, to the
Class
B-1 Certificates; second, to the Class M-9 Certificates; third, to the Class
M-8
Certificates; fourth, to the Class M-7 Certificates; fifth, to the Class M-6
Certificates; sixth, to the Class M-5 Certificates; seventh, to the Class M-4
Certificates; eighth, to the Class M-3 Certificates; ninth, to the Class M-2
Certificates; tenth, to the Class M-1 Certificates; and eleventh, to the Senior
Certificates (pro rata based on the amounts to be distributed). Notwithstanding
anything to the contrary contained herein, to the extent that such tax is
payable by the Holder of any Certificates, the Securities Administrator is
hereby authorized to retain on any Distribution Date, from the Holders of the
Class R Certificates (and, if necessary, second, from the Holders of the other
Certificates in the priority specified in the preceding sentence), funds
otherwise distributable to such Holders in an amount sufficient to pay such
tax.
The Securities Administrator shall include in its monthly report to
Certificateholders distributions to such parties taking into account the
priorities described in the second preceding sentence. The Securities
Administrator agrees to promptly notify in writing the party liable for any
such
tax of the amount thereof and the due date for the payment thereof.
Notwithstanding the foregoing, however, in no event shall the Securities
Administrator have any liability (1) for any action or omission that is taken
in
accordance with and in compliance with the express terms of, or which is
expressly permitted by the terms of this Agreement, (2) for any losses other
than arising out of a grossly negligent performance by the Securities
Administrator 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
X
TERMINATION
| Section 10.01 |
Termination
upon Liquidation or Repurchase of all Mortgage Loans.
|
Subject
to Section 10.03, the obligations and responsibilities of the Depositor,
the Sponsor, the Securities Administrator, the Master Servicer and the Trustee
created hereby with respect to the Trust Fund shall terminate (other than the
obligations of the Master Servicer to the Trustee pursuant to Section 9.05
and of the Securities Administrator to make payments in respect of the REMIC
I
Regular Interests or the Classes of Certificates as hereinafter set forth)
upon
the earlier of (a) the Master Servicer’s exercise of its optional right to
purchase the Mortgage Loans and related REO Properties (the “Cleanup Call”), (b)
Ocwen’s exercise of its optional right to purchase the Mortgage Loans and
related REO Properties (the “Backup Cleanup Call”) and (c) the later of (i) the
maturity or other liquidation (or any Advance with respect thereto) of the
last
Mortgage Loan remaining in the Trust Fund and the disposition of all REO
Property and (ii) the distribution to Certificateholders of all amounts required
to be distributed to them pursuant to this Agreement, as applicable. In no
event
shall the trusts created hereby continue beyond the earlier of (i) the
expiration of twenty-one (21) years from the death of the last survivor of
the
descendants of Xxxxxx X. Xxxxxxx, the late Ambassador of the United States
to
the Court of St. Xxxxx, living on the date hereof and (ii) the Latest Possible
Maturity Date.
The
Cleanup Call or Backup Cleanup Call shall be exercisable at a price (the
“Termination Price”) equal to the sum of (i) 100% of the Stated Principal
Balance of each Mortgage Loan, (ii) accrued interest thereon at the applicable
Mortgage Rate to, but not including, the first day of the month of such
purchase, (iii) the appraised value of any related REO Property (up to the
Stated Principal Balance of the related Mortgage Loan), such appraisal to be
conducted by an appraiser mutually agreed upon by the Master Servicer or Ocwen
Loan Servicing LLC, as applicable, and the Trustee, (iv) unreimbursed
out-of-pocket costs of the Securities Administrator, the Master Servicer, the
Servicers or the Trustee, including unreimbursed servicing advances and the
principal portion of any unreimbursed Advances, made on the related Mortgage
Loans prior to the exercise of such repurchase right, (v) any Swap Termination
Payment payable to the Swap Provider which remains unpaid or which is due to
such Cleanup Call or Backup Cleanup Call and (vi) any other amounts due and
owing to the Trustee, the Securities Administrator, the Master Servicer and
the
Custodian payable pursuant to this Agreement or the Custodial
Agreement.
The
right
to exercise the Cleanup Call pursuant to the preceding paragraph shall be
exercisable if the Stated Principal Balance of all of the Mortgage Loans at
the
time of any such repurchase, is less than or equal to ten percent (10%) of
the
aggregate Cut-off Date Principal Balance of the Mortgage Loans.
The
right
to exercise the Backup Cleanup Call pursuant to the second paragraph hereof
shall be exercisable if the Master Servicer fails to exercise the Cleanup Call
and the Stated Principal Balance of all of the Mortgage Loans at the time of
any
such repurchase, is less than or equal to five percent (5%) of the aggregate
Cut-off Date Principal Balance of the Mortgage Loans.
Notwithstanding
the foregoing, neither
the Master Servicer nor Ocwen Loan Servicing, LLC shall be entitled to exercise
the Cleanup Call or Backup Cleanup Call, as applicable, to the extent that
the
Depositor creates a net interest margin transaction which includes the Class
X
Certificates or Class P Certificates and the notes issued pursuant to such
net
interest margin transaction are outstanding on the date on which the Master
Servicer or Ocwen intends to exercise its Cleanup Call or Backup Cleanup Call,
as applicable.
In
connection with any Cleanup Call or Backup Cleanup Call, four Business Days
prior to the final Distribution Date specified in the notice required pursuant
to Section 10.02, the Securities Administrator shall, no later than 4:00 pm
New
York City time on such day, request in writing (in accordance with the
applicable provision of the Swap Agreement) and by phone from the Swap Provider
the amount of the Estimated Swap Termination Payment. The Swap Provider shall,
no later than 2:00 pm on the following Business Day, notify in writing (which
may be done in electronic format) the Securities Administrator of the amount
of
the Estimated Swap Termination Payment; the Securities Administrator shall
promptly on the same day notify the Master Servicer of the amount of the
Estimated Swap Termination Payment.
Two
Business Days prior to the final Distribution Date specified in the notice
required pursuant to Section 10.02, (i) the Master Servicer or Ocwen, as
applicable, shall, no later than 1:00 pm New York City time on such day, deposit
funds in the Distribution Account in an amount equal to the sum of the
Termination Price (other than the Swap Termination Payment) and the Estimated
Swap Termination Payment, and (ii) if the Securities Administrator shall have
determined that the aggregate Stated Principal Balance of all of the Mortgage
Loans as of the related Determination Date is not more than 10%, or in the
case
of Ocwen, 5% of the aggregate Principal Balance of the Mortgage Loans as of
the
Cut-off Date and that all other requirements of the optional termination have
been met, including without limitation, the deposit required pursuant to the
immediately preceding clause (i) as well as the requirements specified in
Section 10.03, then the Securities Administrator shall, on the same Business
Day, provide written notice to the Depositor, the Master Servicer, the
Servicers, the Supplemental Interest Trust Trustee, the Trustee and the Swap
Provider confirming (in accordance with the applicable provisions of the Swap
Agreement) (a) its receipt of the Termination Price (other than the Swap
Termination Payment) and the Estimated Swap Termination Payment and (b) that
all
other requirements of the optional termination have been met. Upon the
Securities Administrator’s providing the notice described in the preceding
sentence, the optional termination shall become irrevocable, the notice to
Certificateholders of such optional termination provided pursuant to the Section
10.02 shall become unrescindable, the Swap Provider shall determine the Swap
Termination Payment in accordance with the Swap Agreement, and the Swap Provider
shall provide to the Securities Administrator written notice of the amount
of
the Swap Termination Payment not later than one Business Day prior to the final
Distribution Date specified in the notice required pursuant to Section
10.02.
In
connection with any optional termination, only an amount equal to the
Termination Price less any Swap Termination Payment shall be made available
for
distribution to the Regular Certificates. Any Estimated Swap Termination Payment
deposited into the Distribution Account by the Master Servicer or Ocwen, as
applicable, shall be withdrawn by the Securities Administrator from the
Distribution Account on the related final Distribution Date and distributed
as
follows: (i) to the Supplemental Interest Trust for payment to the Swap Provider
in accordance with Section 5.17, an amount equal to the Swap Termination Payment
calculated pursuant to the Swap Agreement, provided that in no event shall
the
amount distributed to the Swap Provider in respect of the Swap Termination
Payment exceed the Estimated Swap Termination Payment, and (ii) to the Master
Servicer or Ocwen, as applicable, an amount equal to the excess, if any, of
the
Estimated Swap Termination Payment over the Swap Termination Payment. The Swap
Termination Payment shall not be part of any REMIC and shall not be paid into
any account which is part of any REMIC.
| Section 10.02 |
Final
Distribution on the Certificates.
|
If
on any
Determination Date, (i) the Securities Administrator determines based on the
reports delivered by the Master Servicer under this Agreement that there are
no
Outstanding Mortgage Loans, and no other funds or assets in the Trust Fund
other
than the funds in the Distribution Account, the Securities Administrator shall
notify the Trustee and send a final distribution notice promptly to each related
Certificateholder or (ii) the Securities Administrator determines that a Class
of Certificates shall be retired after a final distribution on such Class,
the
Securities Administrator shall notify the Trustee and the Certificateholders
within five (5) Business Days after such Determination Date that the final
distribution in retirement of such Class of Certificates is scheduled to be
made
on the immediately following Distribution Date. Any final distribution made
pursuant to the immediately preceding sentence will be made only upon
presentation and surrender of the related Certificates at the office of the
Securities Administrator set forth herein. If the Master Servicer or Ocwen
Loan
Servicing, LLC (each, a “Terminator”) elects to terminate the Trust Fund
pursuant to Section 10.01, at least twenty (20) days prior to the date
notice is to be mailed to the Certificateholders, the related Terminator shall
notify the Securities Administrator and the Trustee of the date the related
Terminator intends to terminate the Trust Fund. The related Terminator shall
remit the related Termination Price to the Securities Administrator on behalf
of
the Trust Fund on the Business Day prior to the Distribution Date for such
Optional Termination by the related Terminator.
Notice
of
the exercise of the Cleanup Call or Backup Cleanup Call, as applicable,
specifying the Distribution Date on which the Certificateholders may surrender
their Certificates for payment of the final distribution and cancellation,
shall
be given promptly by the Securities Administrator by letter to the
Certificateholders mailed no later than the fifteenth (15th) day of the month
of
such final distribution. Any such notice shall specify (a) the Distribution
Date
upon which final distribution on the Certificates will be made upon presentation
and surrender of the Certificates at the office therein designated, (b) the
amount of such final distribution, (c) the location of the office or agency
at
which such presentation and surrender must be made and (d) that the Record
Date
otherwise applicable to such Distribution Date is not applicable, distributions
being made only upon presentation and surrender of the Certificates at the
office therein specified. The Securities Administrator will give such notice
to
each Rating Agency at the time such notice is given to the
Certificateholders.
In
the
event such notice is given, the related Terminator shall remit to the Master
Servicer to, deposit in the Distribution Account on the Business Day prior
to
the applicable Distribution Date an amount equal to the final distribution
in
respect of the Certificates. Upon certification to the Trustee by the Securities
Administrator of the making of such final deposit, the Trustee shall promptly
release or cause to be released to the applicable Terminator the Mortgage Files
for the remaining Mortgage Loans, and the Trustee shall execute all assignments,
endorsements and other instruments delivered to it and necessary to effectuate
such transfer.
Upon
presentation and surrender of the related Certificates, the Securities
Administrator shall cause to be distributed to Certificateholders of each Class
the amounts allocable to such Certificates held in the Distribution Account
in
the order and priority set forth in Section 5.04 hereof on the final
Distribution Date and in proportion to their respective Percentage Interests.
Any funds not distributed to any Certificateholder(s) being retired on such
Distribution Date because of the failure of such Certificateholders to tender
their Certificates shall, on such date, be set aside and held in trust and
credited to the account of the appropriate non-tendering
Certificateholders.
In
the
event that any affected Certificateholders shall not surrender Certificates
for
cancellation within six (6) months after the date specified in the above
mentioned written notice, the Securities Administrator shall give a second
written notice to the remaining affected Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within six (6) months after the second notice all the applicable
Certificates shall not have been surrendered for cancellation, the Securities
Administrator may take appropriate steps, or may appoint an agent to take
appropriate steps, to contact the remaining affected Certificateholders
concerning surrender of their Certificates, and the cost thereof shall be paid
out of the funds and other assets that remain a part of the Trust Fund. If
within two (2) years after the second notice all affected Certificates shall
not
have been surrendered for cancellation, the related Residual Certificateholders
shall be entitled to all unclaimed funds and other assets of the Trust Fund
that
remain subject hereto and the Securities Administrator shall release such funds
upon written direction. No interest shall accrue or be payable to any
Certificateholder on any amount held in trust by the Securities Administrator
as
a result of such Certificateholder’s failure to surrender its Certificate(s) on
the related final Distribution Date for final payment thereof. Any such amounts
held in trust by the Securities Administrator shall be held uninvested in an
Eligible Account.
| Section 10.03 |
Additional
Termination Requirements.
|
In
the
event of (i) the exercise by the Master Servicer of the Cleanup Call pursuant
to
the terms of this Agreement, (ii) the exercise by Ocwen Loan Servicing, LLC
of
the Backup Cleanup Call pursuant to the terms of this Agreement, or (iii) the
final payment on or other liquidation of the last Mortgage Loan or REO Property
in REMIC I pursuant to Section 10.01, the following additional
requirements, unless the Trustee has been supplied with an Opinion of Counsel,
at the expense of the applicable Terminator (in the case of the exercise of
the
Cleanup Call or the Backup Cleanup Call) or the Depositor, to the effect that
the failure of the Trust Fund to comply with the requirements of this
Section 10.03 will not (i) result in the imposition of taxes on “prohibited
transactions” of a REMIC, or (ii) cause any REMIC to fail to qualify as a REMIC
at any time that any Certificates are outstanding:
|
(1)
|
The
applicable Terminator (in the case of the exercise of the Cleanup
Call or
the Backup Cleanup Call) or the Depositor (in all other cases) shall
establish a ninety-day liquidation period and notify the Trustee
thereof,
and the Securities Administrator shall in turn specify the first
day of
such period in a statement attached to the tax return for each REMIC
pursuant to Treasury Regulation Section 1.860F-1. The Master
Servicer, Ocwen Loan Servicing, LLC or the Depositor, as applicable,
shall
satisfy all the requirements of a qualified liquidation under
Section 860F of the Code and any regulations thereunder, as evidenced
by an Opinion of Counsel obtained at the expense of the Master Servicer,
Ocwen Loan Servicing, LLC or the Depositor, as
applicable;
|
|
(2)
|
During
such ninety-day liquidation period, and at or prior to the time of
making
the final payment on the Certificates, the applicable Terminator
(in the
case of the exercise of the Cleanup Call or the Backup Cleanup Call)
or
the Depositor (in all other cases) shall sell all of the assets of
REMIC I
for cash; and
|
|
(3)
|
At
the time of the making of the final payment on the Certificates,
the
Securities Administrator shall distribute or credit, or cause to
be
distributed or credited, to the Holders of the related Residual
Certificates all cash on hand in the Trust Fund (other than cash
retained
to meet claims), and the Trust Fund shall terminate at that
time.
|
By
their
acceptance of the Certificates, the Holders thereof hereby authorize the Master
Servicer (in the case of the exercise of the Cleanup Call), Ocwen Loan
Servicing, LLC (in the case of the exercise of the Backup Cleanup Call) or
the
Depositor (in all other cases) to specify the ninety-day liquidation period
for
REMIC I, REMIC II, REMIC III, REMIC IV, REMIC V and REMIC VI, which
authorization shall be binding upon all successor
Certificateholders.
The
Securities Administrator as agent for each REMIC hereby agrees to adopt and
sign
such a plan of complete liquidation upon the written request of the Master
Servicer, Ocwen Loan Servicing, LLC or the Depositor, as applicable, and the
receipt of the Opinion of Counsel referred to in Section 10.03(1) and to
take such other action in connection therewith as may be reasonably requested
by
the Master Servicer, Ocwen Loan Servicing, LLC or the Depositor, as
applicable.
ARTICLE
XI
MISCELLANEOUS
PROVISIONS
| Section 11.01 |
Amendment.
|
This
Agreement may be amended from time to time by parties hereto, without the
consent of any of the Certificateholders to cure any ambiguity, to correct
or
supplement any provisions herein, to change the manner in which the Distribution
Account maintained by the Securities Administrator or any Custodial Account
maintained by the Servicer is maintained or to make such other provisions with
respect to matters or questions arising under this Agreement as shall not be
inconsistent with any other provisions herein if such action shall not, as
evidenced by an Opinion of Counsel, adversely affect in any material respect
the
interests of any Certificateholder; provided that any such amendment shall
be
deemed not to adversely affect in any material respect the interests of the
Certificateholders and no such Opinion of Counsel shall be required if the
Person requesting such amendment obtains a letter from each Rating Agency
stating that such amendment would not result in the downgrading or withdrawal
of
the respective ratings then assigned to the Certificates; provided further
that
any such amendment shall be deemed not to adversely affect in any material
respect the interests of the Certificateholders and no such Opinion of Counsel
nor any letter from the Rating Agencies stating that such amendment would not
result in the downgrading or withdrawal of the respective ratings then assigned
to the Certificates shall be required if such amendment is to effect a transfer
of servicing pursuant to Section 7.06(a) to an entity satisfying the Minimum
Servicing Requirements.
Notwithstanding
the foregoing, without the consent of the Certificateholders, the parties hereto
may at any time and from time to time amend this Agreement to effect any changes
in the parties’ obligations as are necessary to accommodate evolving
interpretations of the provisions of Regulation AB and to modify, eliminate
or
add to any of its provisions to such extent as shall be necessary or appropriate
to maintain the qualification of each REMIC created hereunder as a REMIC under
the Code or to avoid or minimize the risk of the imposition of any tax on any
of
REMIC pursuant to the Code that would be a claim against any of REMIC at any
time prior to the final redemption of the Certificates, provided that the
Trustee has been provided an Opinion of Counsel, which opinion shall be an
expense of the party requesting such opinion but in any case shall not be an
expense of the Trustee or the Trust Fund, to the effect that such action is
necessary or appropriate to maintain such qualification or to avoid or minimize
the risk of the imposition of such a tax.
This
Agreement may also be amended from time to time by the parties hereto and the
Holders of each Class of Certificates affected thereby evidencing over 50%
of
the Voting Rights of such Class or Classes for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions
of
this Agreement or of modifying in any manner the rights of the Holders of
Certificates; provided that no such amendment shall (i) reduce in any manner
the
amount of, or delay the timing of, payments required to be distributed on any
Certificate without the consent of the Holder of such Certificate, (ii) cause
any REMIC created hereunder to cease to qualify as a REMIC or (iii) reduce
the
aforesaid percentages of Certificates of each Class the Holders of which are
required to consent to any such amendment without the consent of the Holders
of
all Certificates of such Class then outstanding.
Notwithstanding
any contrary provision of this Agreement, the Trustee shall not consent to
any
amendment to this Agreement unless it shall have first received an Opinion
of
Counsel, which opinion shall be an expense of the party requesting such
amendment but in any case shall not be an expense of the Trustee, to the effect
that such amendment will not (other than an amendment pursuant to clause (ii)
of, and in accordance with, the preceding paragraph) cause the imposition of
any
tax on any REMIC or the Certificateholders or cause any REMIC to cease to
qualify as a REMIC at any time that any Certificates are outstanding. Further,
nothing in this Agreement shall require the Trustee to enter into an amendment
without receiving an Opinion of Counsel, satisfactory to the Trustee that (i)
such amendment is permitted and is not prohibited by this Agreement and (ii)
that all requirements for amending this Agreement (including any consent of
the
applicable Certificateholders) have been complied with.
Notwithstanding
any of the other provisions of this Section 11.01, none of the parties to this
Agreement shall enter into any amendment to this Agreement that could reasonably
be expected to have a material adverse effect on the interests of the Swap
Provider hereunder (excluding, for the avoidance of doubt, any amendment to
the
Pooling and Servicing Agreement that is entered into solely for the purpose
of
appointing a successor servicer, master servicer, securities administrator,
trustee or other service provider) without the prior written consent of the
Swap
Provider, which consent shall not be unreasonably withheld, conditioned or
delayed.
Promptly
after the execution of any amendment to this Agreement requiring the consent
of
Certificateholders, the Trustee shall furnish written notification of the
substance of such amendment to each Certificateholder, each Rating Agency and
the Swap Provider.
It
shall
not be necessary for the consent of Certificateholders under this
Section to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Certificateholders shall be subject to such reasonable
regulations as the Trustee may prescribe.
The
Trustee may, but shall not be obligated to enter into any amendment that affects
its rights, duties or immunities under this Agreement or otherwise.
| Section 11.02 |
Recordation
of Agreement; Counterparts.
|
To
the
extent permitted by applicable law, this Agreement is subject to recordation
in
all appropriate public offices for real property records in all of the counties
or other comparable jurisdictions in which any or all of the Mortgaged
Properties are situated, and in any other appropriate public recording office
or
elsewhere. The Sponsor or the Depositor shall effect such recordation at the
Trust’s expense upon the request in writing of a Certificateholder, but only if
such direction is accompanied by an Opinion of Counsel (provided at the expense
of the Certificateholder requesting recordation) to the effect that such
recordation would materially and beneficially affect the interests of the
Certificateholders or is required by law.
For
the
purpose of facilitating the recordation of this Agreement as herein provided
and
for other purposes, this Agreement may be executed simultaneously in any number
of counterparts, each of which counterparts shall be deemed to be an original,
and such counterparts shall constitute but one and the same
instrument.
| Section 11.03 |
Governing
Law.
|
THIS
AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE SUBSTANTIVE
LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED
IN THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HERETO AND THE CERTIFICATEHOLDERS SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS WITHOUT REGARD TO THE CONFLICTS OF LAWS PRINCIPLES THEREOF OTHER THAN
THE
PROVISIONS OF SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS
LAW
WHICH SHALL GOVERN.
| Section 11.04 |
Intention
of Parties.
|
It
is the
express intent of the parties hereto that the conveyance of the Mortgage Notes,
Mortgages, assignments of Mortgages, title insurance policies and any
modifications, extensions and/or assumption agreements and private mortgage
insurance policies relating to the Mortgage Loans by the Sponsor to the
Depositor, and by the Depositor to the Trust Fund be, and be construed as,
an
absolute sale thereof to the Depositor or the Trust Fund, as applicable. It
is,
further, not the intention of the parties that such conveyance be deemed a
pledge thereof by the Sponsor to the Depositor, or by the Depositor to the
Trust
Fund. However, in the event that, notwithstanding the intent of the parties,
such assets are held to be the property of the Sponsor or the Depositor, as
applicable, or if for any other reason this Agreement is held or deemed to
create a security interest in such assets, then (i) this Agreement shall be
deemed to be a security agreement within the meaning of the Uniform Commercial
Code of the State of New York and (ii) each conveyance provided for in this
Agreement shall be deemed to be an assignment and a grant by the Sponsor or
the
Depositor, as applicable, for the benefit of the Certificateholders and the
Swap
Provider, of a security interest in all of the assets that constitute the Trust
Fund, whether now owned or hereafter acquired.
The
Depositor for the benefit of the Certificateholders shall, to the extent
consistent with this Agreement, take such actions as may be necessary to ensure
that, if this Agreement were deemed to create a security interest in the assets
of the Trust Fund, such security interest would be deemed to be a perfected
security interest of first priority under applicable law and will be maintained
as such throughout the term of the Agreement.
| Section 11.05 |
Notices.
|
(a) The
Securities Administrator shall use its best efforts to promptly provide notice
to each Rating Agency with respect to each of the following of which it has
actual knowledge:
(i) Any
material change or amendment to this Agreement;
(ii) The
occurrence of any Servicer Default or Master Servicer Default that has not
been
cured;
(iii) The
resignation or termination of a Servicer, the Master Servicer or the Trustee
and
the appointment of any successor; and
(iv) The
final
payment to Certificateholders.
In
addition, the Securities Administrator shall promptly furnish to each Rating
Agency copies of the following:
(i)
Each
annual statement as to compliance described in Section 3.13;
and
(ii)
Each
annual independent public accountants’ servicing report described in
Section 3.14.
All
directions, demands and notices hereunder shall be in writing and shall be
deemed to have been duly given when delivered at or mailed by registered mail,
return receipt requested, postage prepaid, or by recognized overnight courier,
or by facsimile transmission to a number provided by the appropriate party
if
receipt of such transmission is confirmed to (i) in the case of the Depositor,
Nomura Home Equity Loan, Inc., 2 World Xxxxxxxxx Xxxxxx, Xxxxxxxx X, Xxx Xxxx,
Xxx Xxxx 00000 Attention: Nomura Home Equity Loan, Inc., Home Equity Loan Trust,
Series 2007-2; (ii) in the case of the Sponsor, Nomura Credit & Capital,
Inc., 2 World Xxxxxxxxx Xxxxxx, Xxxxxxxx X, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Nomura Home Equity Loan, Inc., Home Equity Loan Trust, Series 2007-2 or such
other address as may be hereafter furnished to the other parties hereto by
the
Sponsor in writing; (iii) in the case of Equity One, Inc., 000 Xxxxxxxxx Xxxx,
Xxxxxx Xxxx, Xxx Xxxxxx 00000, Attention: Investor Reporting; (iv) in the case
of SPS, Select Portfolio Servicing, Inc., 0000 Xxxxx Xxxx Xxxxxx, Xxxx Xxxx
Xxxx, Xxxx 00000, Attention: General Counsel; (v) in the case of Ocwen, Ocwen
Loan Servicing, LLC, 0000 Xxxxxxxxxxx Xxxx, Xxxxx 000, Xxxx Xxxx Xxxxx, Xxxxxxx
00000, Attention: Secretary; (vi) n the case of the Trustee, at each Corporate
Trust Office or such other address as the Trustee may hereafter furnish to
the
other parties hereto; (vii) in the case of Xxxxx Fargo Bank, National
Association, as Custodian, 00 Xxxxxxxxx Xxxx, Xxxxx 000, Xxxxxx, Xxxxxxxxxx
00000, (viii) in the case of the Securities Administrator, its Corporate Trust
Office; (vii) in the case of the Master Servicer, X.X. Xxx 00, Xxxxxxxx,
Xxxxxxxx 00000 (or for overnight deliveries, 0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx,
Xxxxxxxx 00000, Attention Client Manager - NHEL 2007-2) and (ix) in the case
of
the Rating Agencies, (a) Standard & Poor’s, 00 Xxxxx Xxxxxx, 00xx
Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Mortgage Surveillance Group; (b) Xxxxx’x
Investors Service, Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Home Equity Monitoring; and (c) DBRS, Inc., 55 Broadway, Residential Mortgage
Ratings, Xxx Xxxx, Xxx Xxxx 00000. Any notice delivered to the Sponsor or the
Trustee under this Agreement shall be effective only upon receipt. Any notice
required or permitted to be mailed to a Certificateholder, unless otherwise
provided herein, shall be given by first-class mail, postage prepaid, at the
address of such Certificateholder 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
Certificateholder receives such notice.
| Section 11.06 |
Severability
of Provisions.
|
If
any
one or more of the covenants, agreements, provisions or terms of this Agreement
shall be for any reason whatsoever held invalid, then such covenants,
agreements, provisions or terms shall be deemed severable from the remaining
covenants, agreements, provisions or terms of this Agreement and shall in no
way
affect the validity or enforceability of the other provisions of this Agreement
or of the Certificates or the rights of the Holders thereof.
| Section 11.07 |
Assignment.
|
Notwithstanding
anything to the contrary contained herein, except as provided pursuant to
Section 7.02, this Agreement may not be assigned by the Sponsor or the
Depositor.
| Section 11.08 |
Limitation
on Rights of Certificateholders.
|
The
death
or incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust Fund, nor entitle such Certificateholder’s legal
representative or heirs to claim an accounting or to take any action or commence
any proceeding in any court for a petition or winding up of the Trust Fund,
or
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
No
Certificateholder shall have any right to vote (except as provided herein)
or in
any manner otherwise control the operation and management of the Trust Fund,
or
the obligations of the parties hereto, nor shall anything herein set forth
or
contained in the terms of the Certificates be construed so as to constitute
the
Certificateholders from time to time as partners or members of an association;
nor shall any Certificateholder be under any liability to any third party by
reason of any action taken by the parties to this Agreement pursuant to any
provision hereof.
No
Certificateholder shall have any right by virtue or by availing itself of any
provisions of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Holder previously shall have given to the Trustee, a written notice of such
Servicer Default and of the continuance thereof, as hereinbefore provided,
the
Holders of Certificates evidencing not less than twenty five percent (25%)
of
the Voting Rights evidenced by the Certificates shall also have made written
request to the Trustee to institute such action, suit or proceeding in its
own
name as Trustee, hereunder and shall have offered to the Trustee such indemnity
satisfactory to it as it may require against the costs, expenses, and
liabilities to be incurred therein or thereby, and the Trustee or for sixty
(60)
days after its receipt of such notice, request and offer of indemnity shall
have
neglected or refused to institute any such action, suit or proceeding; it being
understood and intended, and being expressly covenanted by each
Certificateholder with every other Certificateholder and the Trustee, that
no
one or more Holders of Certificates shall have any right in any manner whatever
by virtue or by availing itself or themselves of any provisions of this
Agreement to affect, disturb or prejudice the rights of the Holders of any
other
of the Certificates, or to obtain or seek to obtain priority over or preference
to any other such Holder or to enforce any right under this Agreement, except
in
the manner herein provided and for the common benefit of all Certificateholders.
For the protection and enforcement of the provisions of this Section 11.08,
each and every Certificateholder or the Trustee shall be entitled to such relief
as can be given either at law or in equity.
| Section 11.09 |
Certificates
Nonassessable and Fully Paid.
|
It
is the
intention of the Depositor that Certificateholders shall not be personally
liable for obligations of the Trust Fund, that the interests in the Trust Fund
represented by the Certificates shall be nonassessable for any reason
whatsoever, and that the Certificates, upon due authentication thereof by the
Trustee pursuant to this Agreement, are and shall be deemed fully
paid.
| Section 11.10 |
Third
Party Beneficiaries.
|
Each
Swap
Provider shall be an express third-party beneficiary of this Agreement to the
extent of its express rights to receive any payments under this Agreement or
any
other express
rights of
each
Swap Provider explicitly stated in this Agreement,
and
shall have the right to enforce such rights under this Agreement as if it were
a
party hereto.
| Section 11.11 |
Intention
of the Parties and Interpretation.
|
Each
of
the parties acknowledges and agrees that the purpose of Sections 3.13, 3.14,
3.18 and 5.14 of this Agreement is to facilitate compliance by the Sponsor
and
the Depositor with the provisions of Regulation AB. Therefore, each of the
parties agrees that (a) the obligations of the parties hereunder shall be
interpreted in such a manner as to accomplish that purpose, (b) the parties’
obligations hereunder will be supplemented and modified as necessary to be
consistent with any such amendments, interpretive advice or guidance, convention
or consensus among active participants in the asset-backed securities markets,
advice of counsel, or otherwise in respect of the requirements of Regulation
AB
and (c) the parties shall comply with requests made by the Sponsor or the
Depositor for delivery of additional or different information as the Sponsor
or
the Depositor may determine in good faith is necessary to comply with the
provisions of Regulation AB.
Notwithstanding
the foregoing, the Servicer shall be under no obligation to provide any
information in addition to that required by Sections 3.13, 3.14, 3.18 and 5.14
of this Agreement as of the Closing Date that the Depositor deems required
under
Regulation AB if (i) the Servicer does not believe that such additional
information is required under Regulation AB and (ii) the Servicer is not
providing such additional information for its own securitizations, unless the
Depositor pays all reasonable costs incurred by the Servicer in connection
with
the preparation and delivery of such additional information and the Servicer
is
given reasonable time to establish the necessary systems and procedures to
produce such additional information.
IN
WITNESS WHEREOF, the Depositor, the Sponsor, the Servicers, the Master Servicer,
the Securities Administrator and the Trustee have caused their names to be
signed hereto by their respective officers thereunto duly authorized as of
the
day and year first above written.
|
NOMURA
HOME EQUITY LOAN, INC.,
as
Depositor
|
||
| |
|
|
| By: /s/ Xxxx X. Xxxxxx | ||
|
|
||
|
Name:
Xxxx X. Xxxxxx
Title:
Managing Director
|
||
|
NOMURA
CREDIT & CAPITAL, INC.,
as
Sponsor
|
||
| |
|
|
| By: /s/ Xxxxxxx X. X. Xxxxxxx | ||
|
|
||
|
Name:
Xxxxxxx X. X. Xxxxxxx
Title:
Vice President
|
||
|
XXXXX
FARGO
BANK, NATIONAL
ASSOCIATION,
as
Master Servicer and Securities Administrator
|
||
| |
|
|
| By: /s/ Xxxxx X. Xxxxxx | ||
|
|
||
|
Name:
Xxxxx X. Xxxxxx
Title:
Vice President
|
||
|
HSBC
BANK
USA, NATIONAL
ASSOCIATION,
as
Trustee
|
||
| |
|
|
| By: /s/ Xxxxx Xxxxx | ||
|
|
||
|
Name:
Xxxxx Xxxxx
Title:
Assistant Vice President
|
||
|
EQUITY
ONE, INC.,
as
a Servicer
|
||
| |
|
|
| By: /s/ Xxxx Xxxxxxxx | ||
|
|
||
|
Name:
Xxxx Xxxxxxxx
Title:
EVP
|
||
|
OCWEN
LOAN SERVICING, INC.,
as
a Servicer
|
||
| |
|
|
| By: /s/ Xxxxxxx Xxxxxxx | ||
|
|
||
|
Name:
Xxxxxxx Xxxxxxx
Title:
Authorized Representative
|
||
|
SELECT
PORTFOLIO SERVICING, INC.,
as
a Servicer
|
||
| |
|
|
| By: /s/ Xxx Xxxxxxxxx | ||
|
|
||
|
Name:
Xxx Xxxxxxxxx
Title:
EVP Professional Services
|
||
|
With
respect to Sections 3.33, 3.34, 3.35 and 3.36
XXXXX
FARGO BANK, NATIONAL ASSOCIATION, as
Credit
Risk Manager
|
||
| |
|
|
| By: /s/ Xxxxx X. Xxxxxx | ||
|
|
||
|
Name:
Xxxxx X. Xxxxxx
Title:
Vice President
|
||
|
STATE
OF NEW YORK
|
)
|
|
)
ss.:
|
|
|
COUNTY
OF NEW YORK
|
)
|
On
this
___ day of January 2007, before me, a notary public in and for said State,
appeared _____________, personally known to me on the basis of satisfactory
evidence to be an authorized representative of Nomura Home Equity Loan, Inc.,
one of the entities that executed the within instrument, and also known to
me to
be the person who executed it on behalf of such corporation and acknowledged
to
me that such corporation executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
| |
|
|
|
|
||
|
Notary
Public
|
||
[Notarial Seal]
|
STATE
OF NEW YORK
|
)
|
|
)
ss.:
|
|
|
COUNTY
OF NEW YORK
|
)
|
On
this
____ day of January 2007 before me, a notary public in and for said State,
appeared_______________, personally known to me on the basis of satisfactory
evidence to be an authorized representative of Nomura Credit & Capital,
Inc., one of the entities that executed the within instrument, and also known
to
me to be the person who executed it on behalf of such corporation, and
acknowledged to me that such corporation executed the within
instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
| |
|
|
|
|
||
|
Notary
Public
|
||
[Notarial Seal]
|
STATE
OF
|
)
|
|
)
ss.:
|
|
|
COUNTY
OF
|
)
|
On
this
____ day of January 2007, before me, a notary public in and for said State,
appeared _______________, personally known to me on the basis of satisfactory
evidence to be an authorized representative of Ocwen Loan Servicing, LLC, one
of
the entities that executed the within instrument, and also known to me to be
the
person who executed it on behalf of such corporation, and acknowledged to me
that such corporation executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
| |
|
|
|
|
||
|
Notary
Public
|
||
[Notarial Seal]
|
STATE
OF NEW JERSEY
|
)
|
|
)
ss.:
|
|
|
COUNTY
OF
|
)
|
On
this
____ day of January 2007, before me, a notary public in and for said State,
appeared _________________, personally known to me on the basis of satisfactory
evidence to be an authorized representative of Equity One, Inc., one of the
entities that executed the within instrument, and also known to me to be the
person who executed it on behalf of such corporation and acknowledged to me
that
such corporation executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
| |
|
|
|
|
||
|
Notary
Public
|
||
[Notarial Seal]
|
STATE
OF
|
)
|
|
)
ss.:
|
|
|
COUNTY
OF
|
)
|
On
this
____ day of January 2007, before me, a notary public in and for said State,
appeared _______________, personally known to me on the basis of satisfactory
evidence to be an authorized representative of Select Portfolio Servicing,
Inc.,
one of the entities that executed the within instrument, and also known to
me to
be the person who executed it on behalf of such corporation, and acknowledged
to
me that such corporation executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
| |
|
|
|
|
||
|
Notary
Public
|
||
[Notarial Seal]
|
STATE
OF
|
)
|
|
)
ss.:
|
|
|
COUNTY
OF
|
)
|
On
this
____ day of January 2007, before me, a notary public in and for said State,
appeared _______________, personally known to me on the basis of satisfactory
evidence to be an authorized representative of HSBC Bank USA, National
Association, one of the entities that executed the within instrument, and also
known to me to be the person who executed it on behalf of such corporation,
and
acknowledged to me that such corporation executed the within
instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal
the
day and year in this certificate first above written.
| |
|
|
|
|
||
|
Notary
Public
|
||
[Notarial Seal]
|
STATE
OF
|
)
|
|
)
ss.:
|
|
|
COUNTY
OF
|
)
|
On
this
____ day of January 2007, before me, a notary public in and for said State,
appeared _______________, personally known to me on the basis of satisfactory
evidence to be an authorized representative of Xxxxx Fargo Bank, National
Association, one of the entities that executed the within instrument, and also
known to me to be the person who executed it on behalf of such corporation,
and
acknowledged to me that such corporation executed the within
instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
| |
|
|
|
|
||
|
Notary
Public
|
||
[Notarial Seal]
EXHIBIT
A-1
FORM
OF CLASS [I][II]-A-[1][2][3][4] CERTIFICATE
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “REGULAR INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986
(THE “CODE”).
THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DECREASED BY THE
PRINCIPAL PAYMENTS HEREON. ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF
THE
CERTIFICATES, THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL
BE
DIFFERENT FROM THE DENOMINATION SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE
MAY ASCERTAIN ITS CERTIFICATE PRINCIPAL BALANCE BY INQUIRY OF THE SECURITIES
ADMINISTRATOR NAMED HEREIN.
UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY TO THE DEPOSITOR OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF
CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON
IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
PRIOR
TO THE TERMINATION OF THE SUPPLEMENTAL INTEREST TRUST, ANY PERSON ACQUIRING
A
CERTIFICATE SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS IN SECTION 6.02(b)
OF THE POOLING AND SERVICING AGREEMENT.
|
Certificate
No. [__]
|
Pass-Through
Rate: Floating
|
|
Class
[I][II]-A-[1][2][3][4] Senior
|
|
|
Date
of Pooling and Servicing Agreement
and
Cut-off Date: January 1, 2007
|
Aggregate
Initial Certificate Principal Balance of the Class [I][II]-A-[1][2][3][4]
Certificates as of the Cut-off Date:
$
|
|
Trustee:
HSBC Bank USA, National Association
|
|
|
First
Distribution Date: February 25, 2007
|
Initial
Certificate Principal Balance of this Certificate as of the Cut-off
Date:
$
|
|
Master
Servicer and Securities Administrator: Xxxxx Fargo Bank,
N.A.
|
|
|
Assumed
Final Distribution Date:
January
25, 2037
|
CUSIP:
[______________]
|
ASSET-BACKED
CERTIFICATE
SERIES
2007-2
evidencing
a fractional undivided interest in the distributions allocable to the Class
[I][II]-A-[1][2][3][4] Certificates with respect to a Trust Fund consisting
primarily of a pool of conventional one- to four-family fixed-rate and
adjustable-rate mortgage loans sold by NOMURA HOME EQUITY LOAN,
INC.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Nomura Home Equity Loan, Inc.
(“NHEL”), the Securities Administrator or the Trustee or any of their affiliates
or any other person. Neither this Certificate nor the underlying Mortgage
Loans
are guaranteed or insured by any governmental entity or by NHEL, the Securities
Administrator or the Trustee or any of their affiliates or any other person.
None of NHEL, the Trustee, the Securities Administrator or any of their
affiliates will have any obligation with respect to any certificate or other
obligation secured by or payable from payments on the Certificates.
This
certifies that Cede & Co. is the registered owner of the Percentage Interest
evidenced hereby in the beneficial ownership interest of Certificates of
the
same Class as this Certificate in a trust (the “Trust Fund”) generally
consisting of conventional
first and second lien, fixed-rate and adjustable-rate mortgage loans secured
by
one- to four- family residences, units in planned unit developments, individual
condominium units and townhouses (collectively, the “Mortgage Loans”) sold by
NHEL. The Mortgage Loans were sold by Nomura Credit & Capital, Inc. (the
“Sponsor”) to NHEL. The Trust Fund was created pursuant to the Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
“Agreement”), among NHEL, as depositor (the “Depositor”), the Sponsor,
Ocwen
Loan Servicing, LLC, as a servicer, Equity One, Inc., as a servicer,
Select
Portfolio Servicing, LLC, as a servicer, Xxxxx Fargo Bank, N.A., as master
servicer (the “Master Servicer”) and securities administrator (the “Securities
Administrator”) and HSBC Bank USA, National Association, as trustee (the
“Trustee”), a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, capitalized terms used
herein
shall have the meaning ascribed to them in the Agreement. This Certificate
is
issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of
its
acceptance hereof assents and by which such Holder is bound.
Interest
on this Certificate will accrue during the period commencing on the immediately
preceding Distribution Date (as hereinafter defined) (or with respect to
the
First Distribution Date, the Closing Date) and ending on the day immediately
preceding the related Distribution Date on the Certificate Principal Balance
hereof at a per annum Pass-Through Rate will equal the lesser of (i) the
sum of
One-Month LIBOR for that Distribution Date plus (A) on or prior to the first
possible Optional Termination Date, [___]% or (B) after the first possible
Optional Termination Date, [___]% and (ii) the Net Funds Cap. The Securities
Administrator will distribute on the 25th day of each month, or, if such
25th
day is not a Business Day, the immediately following Business Day (each,
a
“Distribution Date”), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered at the close of
business on the Business Day immediately preceding such Distribution Date,
an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount (of interest and principal, if any) required to
be
distributed to the Holders of Certificates of the same Class as this
Certificate. The Assumed Final Distribution Date is the Distribution Date
in the
month following the latest scheduled maturity date of any Mortgage Loan and
is
not likely to be the date on which the Certificate Principal Balance of this
Class of Certificates will be reduced to zero.
Distributions
on this Certificate will be made by the Securities Administrator by check
mailed
to the address of the Person entitled thereto as such name and address shall
appear on the Certificate Register or, if such Person so requests by notifying
the Securities Administrator in writing as specified in the Agreement.
Notwithstanding the above, the final distribution on this Certificate will
be
made after due notice by the Securities Administrator of the pendency of
such
distribution and only upon presentation and surrender of this Certificate
at the
office or agency appointed by the Securities Administrator for that purpose
and
designated in such notice. The initial Certificate Principal Balance of this
Certificate is set forth above. The Certificate Principal Balance hereof
will be
reduced to the extent of distributions allocable to principal
hereon.
This
Certificate is one of a duly authorized issue of Certificates designated
as set
forth on the face hereof (the “Certificates”). The Certificates, in the
aggregate, evidence the entire beneficial ownership interest in the Trust
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that the Trustee
is not
liable to the Certificateholders for any amount payable under this Certificate
or the Agreement or, except as expressly provided in the Agreement, subject
to
any liability under the Agreement.
This
Certificate does not purport to summarize the Agreement and reference is
made to
the Agreement for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced hereby, and the rights, duties and immunities
of the Securities Administrator. This Certificate is limited in right of
payment
to certain collections and recoveries respecting the Mortgage Loans and other
assets included in the Trust Fund relating to the Mortgage Loan and the
Supplemental Interest Trust, all as more specifically set forth in the
Agreement.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of the Class or Classes
of
Certificates affected thereby evidencing over 50% of the Voting Rights of
such
Class or Classes. Any such consent by the Holder of this Certificate shall
be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the
Certificates.
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable with the Securities
Administrator upon surrender of this Certificate for registration of transfer
at
the offices or agencies maintained by the Securities Administrator for such
purposes, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator duly executed by the
Holder
hereof or such Holder’s attorney duly authorized in writing, and thereupon one
or more new Certificates in authorized denominations representing a like
aggregate Percentage Interest will be issued to the designated
transferee.
Prior
to
the termination of the Supplemental Interest Trust, any transferee of this
Certificate shall be deemed to make the representations in Section 6.02(b)
of
the Agreement.
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the Certificateholders for any such registration
of transfer, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee, the Securities
Administrator and any agent of any of them may treat the Person in whose
name
this Certificate is registered as the owner hereof for all purposes, and
none of
the Depositor, the Master Servicer, the Trustee, the Securities Administrator
or
any such agent shall be affected by notice to the contrary.
The
obligations created by the Agreement and the Trust Fund created thereby (other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund subject to additional terms
set forth in the Agreement. Such optional repurchase may be made by (i) the
Master Servicer only if on such Distribution Date the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 10% of the Cut-off
Date
Principal Balance of the Mortgage Loans and (ii) by Ocwen Loan Servicing,
LLC
only if on such Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 5% of the Cut-off
Date
Principal Balance of the Mortgage Loans. The exercise of such right will
effect
the early retirement of the Certificates. Notwithstanding the foregoing,
the
Master Servicer shall not be entitled to exercise the Cleanup Call to the
extent
that the Depositor creates a net interest margin transaction which includes
the
Class X Certificates or Class P Certificates and the notes issued pursuant
to
such net interest margin transaction are outstanding on the date on which
the
Master Servicer intends to exercise the Cleanup Call. In no event, however,
will
the Trust Fund created by the Agreement continue beyond the earlier of (i)
the
expiration of 21 years after the death of certain persons identified in the
Agreement and (ii) the Assumed Final Distribution Date.
Unless
this Certificate has been countersigned by an authorized signatory of the
Securities Administrator by manual signature, this Certificate shall not
be
entitled to any benefit under the Agreement, or be valid for any
purpose.
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
|
Dated: January
__, 2007
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class [I][II]-A-[1][2][3][4] Certificates referred to in the
within-mentioned Agreement.
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and address
including postal zip code of assignee) a Percentage Interest evidenced by
the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of a
like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:
|
.
|
|
Dated:
|
_________________________________
|
|
Signature
by or on behalf of assignor
|
|
|
_________________________________
|
|
|
Signature
Guaranteed
|
DISTRIBUTION
INSTRUCTIONS
The
assignee should include the following for purposes of distribution:
|
Distributions
shall be made, by wire transfer or otherwise, in immediately available
|
|||||||
|
funds
to
|
|||||||
|
for
the account of
|
|||||||
|
account
number
|
or,
if mailed by check, to
|
||||||
|
Applicable
statements should be mailed to
|
|||||||
|
This
information is provided by
|
|||||||
|
assignee
named above, or
|
|||||||
|
its
agent.
|
|||||||
EXHIBIT
A-2
FORM
OF CLASS M-[1][2][3][4][5][6][7][8][9] CERTIFICATE
THIS
CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR CERTIFICATES
[[AND
]THE CLASS M-1 CERTIFICATES] [[,/AND] THE CLASS M-2 CERTIFICATES] [[AND/,]
THE
CLASS M-3 CERTIFICATES] [[AND/,] THE CLASS M-4 CERTIFICATES] [[,/AND] THE
CLASS
M-5 CERTIFICATES] [[,/AND] THE CLASS M-6 CERTIFICATES] [[,/AND] THE CLASS
M-7
CERTIFICATES] [AND] THE CLASS M-8 CERTIFICATES] AS DESCRIBED IN THE AGREEMENT
(AS DEFINED BELOW).
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “REGULAR INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986
(THE “CODE”).
THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DECREASED BY PRINCIPAL
PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO. ACCORDINGLY, FOLLOWING
THE
INITIAL ISSUANCE OF THE CERTIFICATES, THE CERTIFICATE PRINCIPAL BALANCE OF
THIS
CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION SHOWN BELOW. ANYONE
ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CERTIFICATE PRINCIPAL BALANCE
BY
INQUIRY OF THE SECURITIES ADMINISTRATOR NAMED HEREIN.
ANY
TRANSFEREE OF THIS CERTIFICATE SHALL BE DEEMED TO MAKE THE REPRESENTATIONS
SET
FORTH IN SECTION 6.02(b) OF THE AGREEMENT.
UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY TO THE DEPOSITOR OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF
CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON
IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
|
Certificate
No. [__]
|
Pass-Through
Rate: Floating
|
|
Class
M-[1][2][3][4][5][6][7][8][9] Subordinate
|
|
|
|
|
|
Date
of Pooling and Servicing Agreement and Cut-off Date: January 1,
2007
|
Aggregate
Initial Certificate Principal Balance of the Class
M-[1][2][3][4][5][6][7][8][9] Certificates as of the Cut-off
Date:
$
|
|
Trustee:
HSBC Bank USA, National Association
|
|
|
First
Distribution Date: February 25, 2007
|
Initial
Certificate Principal Balance of this Certificate as of the Cut-off
Date:
$
|
|
Master
Servicer and Securities Administrator: Xxxxx Fargo Bank,
N.A.
|
|
|
Assumed
Final Distribution Date:
January
25, 2037
|
CUSIP:
[__________________]
|
ASSET-BACKED
CERTIFICATE
SERIES
2007-2
evidencing
a fractional undivided interest in the distributions allocable to the Class
M-[1][2][3][4][5][6][7][8][9] Certificates with respect to a Trust Fund
consisting primarily of a pool of conventional one- to four-family fixed-rate
and adjustable-rate mortgage loans sold by NOMURA HOME EQUITY LOAN,
INC.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Nomura Home Equity Loan, Inc.
(“NHEL”), the Securities Administrator or the Trustee or any of their affiliates
or any other person. Neither this Certificate nor the underlying Mortgage
Loans
are guaranteed or insured by any governmental entity or by NHEL, the Securities
Administrator or the Trustee or any of their affiliates or any other person.
None of NHEL, the Trustee, the Securities Administrator or any of their
affiliates will have any obligation with respect to any certificate or other
obligation secured by or payable from payments on the Certificates.
This
certifies that Cede & Co. is the registered owner of the Percentage Interest
evidenced hereby in the beneficial ownership interest of Certificates of
the
same Class as this Certificate in a trust (the “Trust Fund”) generally
consisting of conventional first and second lien, fixed-rate and adjustable-rate
mortgage loans secured by one- to four- family residences, units in planned
unit
developments, individual condominium units and townhouses (collectively,
the
“Mortgage Loans”) sold by NHEL. The Mortgage Loans were sold by Nomura Credit
& Capital, Inc. (the “Sponsor”) to NHEL. The Trust Fund was created pursuant
to the Pooling and Servicing Agreement dated as of the Cut-off Date specified
above (the “Agreement”), among NHEL, as depositor (the “Depositor”), the
Sponsor, Ocwen Loan Servicing, LLC, as a servicer, Equity One, Inc., as a
servicer, Select Portfolio Servicing, LLC, as a servicer, Xxxxx Fargo Bank,
N.A., as master servicer (the “Master Servicer”) and securities administrator
(the “Securities Administrator”) and HSBC Bank USA, National Association, as
trustee (the “Trustee”), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, capitalized
terms used herein shall have the meaning ascribed to them in the Agreement.
This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of its acceptance hereof assents and by which such Holder is
bound.
Interest
on this Certificate will accrue during the period commencing on the immediately
preceding Distribution Date (as hereinafter defined) (or with respect to
the
First Distribution Date, the Closing Date) and ending on the day immediately
preceding the related Distribution Date on the Certificate Principal Balance
hereof at a per annum Pass-Through Rate will equal the lesser of (i) the
sum of
One-Month LIBOR for that Distribution Date plus (A) on or prior to the first
possible Optional Termination Date, [___]% or (B) after the first possible
Optional Termination Date, [___]% and (ii) the Net Funds Cap. The Securities
Administrator will distribute on the 25th day of each month, or, if such
25th
day is not a Business Day, the immediately following Business Day (each,
a
“Distribution Date”), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered at the close of
business on the Business Day immediately preceding such Distribution Date,
an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount (of interest and principal, if any) required to
be
distributed to the Holders of Certificates of the same Class as this
Certificate. The Assumed Final Distribution Date is the Distribution Date
in the
month following the latest scheduled maturity date of any Mortgage Loan and
is
not likely to be the date on which the Certificate Principal Balance of this
Class of Certificates will be reduced to zero.
Distributions
on this Certificate will be made by the Securities Administrator by check
mailed
to the address of the Person entitled thereto as such name and address shall
appear on the Certificate Register or, if such Person so requests by notifying
the Securities Administrator in writing as specified in the Agreement.
Notwithstanding the above, the final distribution on this Certificate will
be
made after due notice by the Securities Administrator of the pendency of
such
distribution and only upon presentation and surrender of this Certificate
at the
office or agency appointed by the Securities Administrator for that purpose
and
designated in such notice. The initial Certificate Principal Balance of this
Certificate is set forth above. The Certificate Principal Balance hereof
will be
reduced to the extent of distributions allocable to principal hereon and
any
Realized Losses allocable hereto.
This
Certificate is one of a duly authorized issue of Certificates designated
as set
forth on the face hereof (the “Certificates”). The Certificates, in the
aggregate, evidence the entire beneficial ownership interest in the Trust
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that the Trustee
is not
liable to the Certificateholders for any amount payable under this Certificate
or the Agreement or, except as expressly provided in the Agreement, subject
to
any liability under the Agreement.
This
Certificate does not purport to summarize the Agreement and reference is
made to
the Agreement for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced hereby, and the rights, duties and immunities
of the Securities Administrator. This Certificate is limited in right of
payment
to certain collections and recoveries respecting the Mortgage Loans and other
assets included in the Trust Fund relating to the Mortgage Loan and the
Supplemental Interest Trust, all as more specifically set forth in the
Agreement.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of the Class or Classes
of
Certificates affected thereby evidencing over 50% of the Voting Rights of
such
Class or Classes. Any such consent by the Holder of this Certificate shall
be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the
Certificates.
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable with the Securities
Administrator upon surrender of this Certificate for registration of transfer
at
the offices or agencies maintained by the Securities Administrator for such
purposes, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator duly executed by the
Holder
hereof or such Holder’s attorney duly authorized in writing, and thereupon one
or more new Certificates in authorized denominations representing a like
aggregate Percentage Interest will be issued to the designated
transferee.
Any
transferee of this Certificate shall be deemed to make the representations
set
forth in Section 6.02(b) of the Agreement.
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the Certificateholders for any such registration
of transfer, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee, the Securities
Administrator and any agent of any of them may treat the Person in whose
name
this Certificate is registered as the owner hereof for all purposes, and
none of
the Depositor, the Master Servicer, the Trustee, the Securities Administrator
or
any such agent shall be affected by notice to the contrary.
The
obligations created by the Agreement and the Trust Fund created thereby (other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund subject to additional terms
set forth in the Agreement. Such optional repurchase may be made (i) by the
Master Servicer only if on such Distribution Date the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 10% of the Cut-off
Date
Principal Balance of the Mortgage Loans and (ii) by Ocwen Loan Servicing,
LLC
only if on such Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 5% of the Cut-off
Date
Principal Balance of the Mortgage Loans. The exercise of such right will
effect
the early retirement of the Certificates. Notwithstanding the foregoing,
the
Master Servicer shall not be entitled to exercise the Cleanup Call to the
extent
that the Depositor creates a net interest margin transaction which includes
the
Class X Certificates or Class P Certificates and the notes issued pursuant
to
such net interest margin transaction are outstanding on the date on which
the
Master Servicer intends to exercise the Cleanup Call. In no event, however,
will
the Trust Fund created by the Agreement continue beyond the earlier of (i)
the
expiration of 21 years after the death of certain persons identified in the
Agreement and (ii) the Assumed Final Distribution Date.
Unless
this Certificate has been countersigned by an authorized signatory of the
Securities Administrator by manual signature, this Certificate shall not
be
entitled to any benefit under the Agreement, or be valid for any
purpose.
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
|
Dated: January
__, 2007
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class M-[1][2][3][4][5][6][7][8][9] Certificates referred to in
the
within-mentioned Agreement.
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and address
including postal zip code of assignee) a Percentage Interest evidenced by
the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of a
like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:
|
.
|
|
Dated:
|
_________________________________
|
|
Signature
by or on behalf of assignor
|
|
|
_________________________________
|
|
|
Signature
Guaranteed
|
DISTRIBUTION
INSTRUCTIONS
The
assignee should include the following for purposes of distribution:
|
Distributions
shall be made, by wire transfer or otherwise, in immediately available
|
|||||||
|
funds
to
|
|||||||
|
for
the account of
|
|||||||
|
account
number
|
or,
if mailed by check, to
|
||||||
|
Applicable
statements should be mailed to
|
|||||||
|
This
information is provided by
|
|||||||
|
assignee
named above, or
|
|||||||
|
its
agent.
|
|||||||
EXHIBIT
A-3
FORM
OF CLASS B-1 CERTIFICATE
THIS
CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR CERTIFICATES
AND
THE MEZZANINE CERTIFICATES AS DESCRIBED IN THE AGREEMENT (AS DEFINED
BELOW).
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “REGULAR INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986
(THE “CODE”).
THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DECREASED BY THE
PRINCIPAL PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO. ACCORDINGLY,
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CERTIFICATE PRINCIPAL
BALANCE OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION SHOWN
BELOW.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CERTIFICATE PRINCIPAL
BALANCE BY INQUIRY OF THE SECURITIES ADMINISTRATOR NAMED
HEREIN.
THIS
CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES LAWS. THE
HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE
MAY
BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE
WITH
THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE
144A
UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
(A
“QIB”), PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF
A
QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT
TO
AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES
ACT (IF
AVAILABLE) OR (3) TO AN “INSTITUTIONAL ACCREDITED INVESTOR” WITHIN THE MEANING
THEREOF IN RULE 501(a)(1), (2), (3) or (7) OF REGULATION D UNDER THE ACT
OR ANY
ENTITY IN WHICH ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS PURCHASING
NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO (A) THE
RECEIPT BY THE SECURITIES ADMINISTRATOR OF A LETTER SUBSTANTIALLY IN THE
FORM
PROVIDED IN THE AGREEMENT AND (B) THE RECEIPT BY THE SECURITIES ADMINISTRATOR
OF
SUCH OTHER EVIDENCE ACCEPTABLE TO THE SECURITIES ADMINISTRATOR THAT SUCH
REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE SECURITIES
ACT AND
OTHER APPLICABLE LAWS OR IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE
SECURITIES LAWS OF THE UNITED STATES AND ANY OTHER APPLICABLE
JURISDICTION.
ANY
TRANSFEREE OF THIS CERTIFICATE SHALL MAKE OR BE DEEMED TO MAKE THE
REPRESENTATIONS SET FORTH IN SECTION 6.02(b) OF THE
AGREEMENT.
|
Certificate
No. [__]
|
Pass-Through
Rate: Floating
|
|
Class
B-1 Subordinate
|
|
|
|
|
|
Date
of Pooling and Servicing Agreement and Cut-off Date:
January
1, 2007
|
Aggregate
Initial Certificate Principal Balance of the Class B-1 Certificates
as of
the Cut-off Date:
$
|
|
Trustee:
HSBC Bank USA, National Association
|
|
|
First
Distribution Date: February 25, 2007
|
Initial
Certificate Principal Balance of this Certificate as of the Cut-off
Date:
$
|
|
Master
Servicer and Securities Administrator: Xxxxx Fargo Bank,
N.A.
|
|
|
Assumed
Final Distribution Date:
January
25, 2037
|
CUSIP:
[__________________]
|
ASSET-BACKED
CERTIFICATE
SERIES
2007-2
evidencing
a fractional undivided interest in the distributions allocable to the Class
B-1
Certificates with respect to a Trust Fund consisting primarily of a pool
of
conventional one- to four-family fixed-rate and adjustable-rate mortgage
loans
sold by NOMURA HOME EQUITY LOAN, INC.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Nomura Home Equity Loan, Inc.
(“NHEL”), the Securities Administrator or the Trustee or any of their affiliates
or any other person. Neither this Certificate nor the underlying Mortgage
Loans
are guaranteed or insured by any governmental entity or by NHEL, the Securities
Administrator or the Trustee or any of their affiliates or any other person.
None of NHEL, the Trustee, the Securities Administrator or any of their
affiliates will have any obligation with respect to any certificate or other
obligation secured by or payable from payments on the Certificates.
This
certifies that Cede & Co. is the registered owner of the Percentage Interest
evidenced hereby in the beneficial ownership interest of Certificates of
the
same Class as this Certificate in a trust (the “Trust Fund”) generally
consisting of conventional first and second lien, fixed-rate and adjustable-rate
mortgage loans secured by one- to four- family residences, units in planned
unit
developments, individual condominium units and townhouses (collectively,
the
“Mortgage Loans”) sold by NHEL. The Mortgage Loans were sold by Nomura Credit
& Capital, Inc. (the “Sponsor”) to NHEL. The Trust Fund was created pursuant
to the Pooling and Servicing Agreement dated as of the Cut-off Date specified
above (the “Agreement”), among NHEL, as depositor (the “Depositor”), the
Sponsor, Ocwen Loan Servicing, LLC, as a servicer, Equity One, Inc, as a
servicer, Select Portfolio Servicing, LLC, as a servicer, Xxxxx Fargo Bank,
N.A., as master servicer (the “Master Servicer”) and securities administrator
(the “Securities Administrator”) and HSBC Bank USA, National Association, as
trustee (the “Trustee”), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, capitalized
terms used herein shall have the meaning ascribed to them in the Agreement.
This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of its acceptance hereof assents and by which such Holder is
bound.
Interest
on this Certificate will accrue during the period commencing on the immediately
preceding Distribution Date (as hereinafter defined) (or with respect to
the
First Distribution Date, the Closing Date) and ending on the day immediately
preceding the related Distribution Date on the Certificate Principal Balance
hereof at a per annum Pass-Through Rate will equal the lesser of (i) the
sum of
One-Month LIBOR for that Distribution Date plus (A) on or prior to the first
possible Optional Termination Date, [___]% or (B) after the first possible
Optional Termination Date, [___]% and (ii) the Net Funds Cap. The Securities
Administrator will distribute on the 25th day of each month, or, if such
25th
day is not a Business Day, the immediately following Business Day (each,
a
“Distribution Date”), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered at the close of
business on the last Business Day of the calendar month preceding such
Distribution Date, an amount equal to the product of the Percentage Interest
evidenced by this Certificate and the amount (of interest and principal,
if any)
required to be distributed to the Holders of Certificates of the same Class
as
this Certificate. The Assumed Final Distribution Date is the Distribution
Date
in the month following the latest scheduled maturity date of any Mortgage
Loan
and is not likely to be the date on which the Certificate Principal Balance
of
this Class of Certificates will be reduced to zero.
Distributions
on this Certificate will be made by the Securities Administrator by check
mailed
to the address of the Person entitled thereto as such name and address shall
appear on the Certificate Register or, if such Person so requests by notifying
the Securities Administrator in writing as specified in the Agreement.
Notwithstanding the above, the final distribution on this Certificate will
be
made after due notice by the Securities Administrator of the pendency of
such
distribution and only upon presentation and surrender of this Certificate
at the
office or agency appointed by the Securities Administrator for that purpose
and
designated in such notice. The initial Certificate Principal Balance of this
Certificate is set forth above. The Certificate Principal Balance hereof
will be
reduced to the extent of distributions allocable to principal hereon and
any
Realized Losses allocable hereto.
This
Certificate is one of a duly authorized issue of Certificates designated
as set
forth on the face hereof (the “Certificates”). The Certificates, in the
aggregate, evidence the entire beneficial ownership interest in the Trust
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that the Trustee
is not
liable to the Certificateholders for any amount payable under this Certificate
or the Agreement or, except as expressly provided in the Agreement, subject
to
any liability under the Agreement.
This
Certificate does not purport to summarize the Agreement and reference is
made to
the Agreement for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced hereby, and the rights, duties and immunities
of the Securities Administrator. This Certificate is limited in right of
payment
to certain collections and recoveries respecting the Mortgage Loans and other
assets included in the Trust Fund relating to the Mortgage Loan and the
Supplemental Interest Trust, all as more specifically set forth in the
Agreement.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of the Class or Classes
of
Certificates affected thereby evidencing over 50% of the Voting Rights of
such
Class or Classes. Any such consent by the Holder of this Certificate shall
be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the
Certificates.
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable with the Securities
Administrator upon surrender of this Certificate for registration of transfer
at
the offices or agencies maintained by the Securities Administrator for such
purposes, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator duly executed by the
Holder
hereof or such Holder’s attorney duly authorized in writing, and thereupon one
or more new Certificates in authorized denominations representing a like
aggregate Percentage Interest will be issued to the designated
transferee.
No
transfer of this Certificate shall be made unless the transfer is made pursuant
to an effective registration statement under the Securities Act of 1933,
as
amended (the “1933 Act”), and an effective registration or qualification under
applicable state securities laws, or is made in a transaction that does not
require such registration or qualification. In the event that such a transfer
of
this Certificate is to be made without registration or qualification, the
Securities Administrator shall require receipt of (i) if such transfer is
purportedly being made in reliance upon Rule 144A under the 1933 Act, written
certifications from the Holder of the Certificate desiring to effect the
transfer, and from such Holder’s prospective transferee, substantially in the
forms attached to the Agreement as Exhibit E and either F or G, as applicable,
and (ii) in all other cases, an Opinion of Counsel satisfactory to it that
such
transfer may be made without such registration or qualification (which Opinion
of Counsel shall not be an expense of the Trust Fund or of the Depositor
or the
Securities Administrator in their respective capacities as such), together
with
copies of the written certification(s) of the Holder of the Certificate desiring
to effect the transfer and/or such Holder’s prospective transferee upon which
such Opinion of Counsel is based. Neither the Depositor nor the Securities
Administrator is obligated to register or qualify the Class of Certificates
specified on the face hereof under the 1933 Act or any other securities law
or
to take any action not otherwise required under the Agreement to permit the
transfer of such Certificates without registration or qualification. Any
Holder
desiring to effect a transfer of this Certificate shall be required to indemnify
the Trustee, the Securities Administrator, the Depositor and the Sponsor
against
any liability that may result if the transfer is not so exempt or is not
made in
accordance with such federal and state laws.
Any
Transferee of this Certificate shall make or be deemed to make the
representations set forth in Section 6.02(b) of the Agreement.
No
service charge will be made to the Certificateholders for any such registration
of transfer, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee, the Securities
Administrator and any agent of any of them may treat the Person in whose
name
this Certificate is registered as the owner hereof for all purposes, and
none of
the Depositor, the Master Servicer, the Trustee, the Securities Administrator
or
any such agent shall be affected by notice to the contrary.
The
obligations created by the Agreement and the Trust Fund created thereby (other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund subject to additional terms
set forth in the Agreement. Such optional repurchase may be made (i) by the
Master Servicer only if on such Distribution Date the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 10% of the Cut-off
Date
Principal Balance of the Mortgage Loans and (ii) by Ocwen Loan Servicing,
LLC
only if on such Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 5% of the Cut-off
Date
Principal Balance of the Mortgage Loans. The exercise of such right will
effect
the early retirement of the Certificates. Notwithstanding the foregoing,
the
Master Servicer shall not be entitled to exercise the Cleanup Call to the
extent
that the Depositor creates a net interest margin transaction which includes
the
Class X Certificates or Class P Certificates and the notes issued pursuant
to
such net interest margin transaction are outstanding on the date on which
the
Master Servicer intends to exercise the Cleanup Call. In no event, however,
will
the Trust Fund created by the Agreement continue beyond the earlier of (i)
the
expiration of 21 years after the death of certain persons identified in the
Agreement and (ii) the Assumed Final Distribution Date.
Unless
this Certificate has been countersigned by an authorized signatory of the
Securities Administrator by manual signature, this Certificate shall not
be
entitled to any benefit under the Agreement, or be valid for any
purpose.
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
Dated:
January __, 2007
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
||
|
By:
|
||
|
Authorized
Signatory
|
||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class B-1 Certificates referred to in the within-mentioned
Agreement.
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and address
including postal zip code of assignee) a Percentage Interest evidenced by
the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of a
like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:
|
.
|
|
Dated:
|
_________________________________
|
|
Signature
by or on behalf of assignor
|
|
|
_________________________________
|
|
|
Signature
Guaranteed
|
DISTRIBUTION
INSTRUCTIONS
The
assignee should include the following for purposes of distribution:
|
Distributions
shall be made, by wire transfer or otherwise, in immediately available
|
|||||||
|
funds
to
|
|||||||
|
for
the account of
|
|||||||
|
account
number
|
or,
if mailed by check, to
|
||||||
|
Applicable
statements should be mailed to
|
|||||||
|
This
information is provided by
|
|||||||
|
assignee
named above, or
|
|||||||
|
its
agent.
|
|||||||
EXHIBIT
A-4
FORM
OF CLASS X CERTIFICATE
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “REGULAR INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986
(THE “CODE”).
THIS
CERTIFICATE IS SUBORDINATE TO THE SENIOR CERTIFICATES AND SUBORDINATE
CERTIFICATES TO THE EXTENT DESCRIBED IN THE AGREEMENT REFERRED TO
HEREIN.
THIS
CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES LAWS. THE
HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE
MAY
BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE
WITH
THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE
144A
UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
(A
“QIB”), PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF
A
QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT
TO
AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES
ACT (IF
AVAILABLE) OR (3) IN CERTIFICATED FORM TO AN “INSTITUTIONAL ACCREDITED INVESTOR”
WITHIN THE MEANING THEREOF IN RULE 501(a)(1), (2), (3) or (7) OF REGULATION
D
UNDER THE ACT OR ANY ENTITY IN WHICH ALL OF THE EQUITY OWNERS COME WITHIN
SUCH
PARAGRAPHS PURCHASING NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES
ACT,
SUBJECT TO (A) THE RECEIPT BY THE SECURITIES ADMINISTRATOR OF A LETTER
SUBSTANTIALLY IN THE FORM PROVIDED IN THE AGREEMENT AND (B) THE RECEIPT BY
THE
SECURITIES ADMINISTRATOR OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE SECURITIES
ADMINISTRATOR THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE
WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH CASE IN ACCORDANCE
WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND ANY OTHER
APPLICABLE JURISDICTION.
NO
TRANSFER OF THIS CERTIFICATE SHALL BE MADE TO ANY PERSON, UNLESS THE TRANSFEREE
PROVIDES A CERTIFICATION PURSUANT TO SECTION 6.02(b) OF THE
AGREEMENT.
|
Certificate
No. [__]
|
Percentage
Interest: [___]%
|
|
Class
X
|
Variable
Pass-Through Rate
|
|
Date
of Pooling and Servicing Agreement and Cut-off Date:
January
1, 2007
|
Initial
Certificate Principal Balance of this Certificate as of the Cut-off
Date:
$
|
|
Trustee:
HSBC Bank USA, National Association
|
Master
Servicer and Securities Administrator: Xxxxx Fargo Bank,
N.A.
|
|
First
Distribution Date: February 25, 2007
|
|
|
Assumed
Final Distribution Date:
January
25, 2037
|
CUSIP:
[_____________]
|
ASSET-BACKED
CERTIFICATE
SERIES
2007-2
evidencing
a fractional undivided interest in the distributions allocable to the Class
X
Certificates with respect to a Trust Fund consisting primarily of a pool
of
conventional one- to four-family fixed-rate and adjustable-rate mortgage
loans
sold by NOMURA HOME EQUITY LOAN, INC.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Nomura Home Equity Loan, Inc.
(“NHEL”), the Securities Administrator or the Trustee or any of their affiliates
or any other person. Neither this Certificate nor the underlying Mortgage
Loans
are guaranteed or insured by any governmental entity or by NHEL, the Securities
Administrator or the Trustee or any of their affiliates or any other person.
None of NHEL, the Trustee, the Securities Administrator or any of their
affiliates will have any obligation with respect to any certificate or other
obligation secured by or payable from payments on the Certificates.
This
certifies that [______________] is the registered owner of the Percentage
Interest evidenced hereby in the beneficial ownership interest of Certificates
of the same Class as this Certificate in a trust (the “Trust Fund”), generally
consisting of conventional first and second lien, fixed-rate and adjustable-rate
mortgage loans secured by one- to four- family residences, units in planned
unit
developments, individual condominium units and townhouses (collectively,
the
“Mortgage Loans”) sold by NHEL. The Mortgage Loans were sold by Nomura Credit
& Capital, Inc. (the “Sponsor”) to NHEL. The Trust Fund was created pursuant
to the Pooling and Servicing Agreement dated as of the Cut-off Date specified
above (the “Agreement”), among NHEL, as depositor (the “Depositor”), the
Sponsor, Ocwen Loan Servicing, LLC, as a servicer, Equity One, Inc., as a
servicer, Select Portfolio Servicing, LLC, as a servicer, Xxxxx Fargo Bank,
N.A., as master servicer (the “Master Servicer”) and securities administrator
(the “Securities Administrator”) and HSBC Bank USA, National Association, as
trustee (the “Trustee”), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, capitalized
terms used herein shall have the meaning ascribed to them in the Agreement.
This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of its acceptance hereof assents and by which such Holder is
bound.
Interest
on this Certificate will accrue during the month prior to the month in which
a
Distribution Date (as hereinafter defined) occurs on the Certificate Notional
Balance hereof at a per annum rate equal to the Class X Pass-Through Rate
as set
forth in the Agreement. The Securities Administrator will distribute on the
25th
day of each month, or, if such 25th day is not a Business Day, the immediately
following Business Day (each, a “Distribution Date”), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the last day (or if such last day
is
not a Business Day, the Business Day immediately preceding such last day)
of the
calendar month immediately preceding the month in which the Distribution
Date
occurs, an amount equal to the product of the Percentage Interest evidenced
by
this Certificate and the amount required to be distributed to the Holders
of
Certificates of the same Class as this Certificate. The Assumed Final
Distribution Date is the Distribution Date in the month following the latest
scheduled maturity date of any Mortgage Loan.
Distributions
on this Certificate will be made by the Securities Administrator by check
mailed
to the address of the Person entitled thereto as such name and address shall
appear on the Certificate Register or, if such Person so requests by notifying
the Securities Administrator in writing as specified in the Agreement.
Notwithstanding the above, the final distribution on this Certificate will
be
made after due notice by the Securities Administrator of the pendency of
such
distribution and only upon presentation and surrender of this Certificate
at the
office or agency appointed by the Securities Administrator for that purpose
and
designated in such notice.
No
transfer of this Certificate shall be made unless the transfer is made pursuant
to an effective registration statement under the Securities Act of 1933,
as
amended (the “1933 Act”), and an effective registration or qualification under
applicable state securities laws, or is made in a transaction that does not
require such registration or qualification. In the event that such a transfer
of
this Certificate is to be made without registration or qualification, the
Securities Administrator shall require receipt of (i) if such transfer is
purportedly being made in reliance upon Rule 144A under the 1933 Act, written
certifications from the Holder of the Certificate desiring to effect the
transfer, and from such Holder’s prospective transferee, substantially in the
forms attached to the Agreement as Exhibit E and either F or G, as applicable,
and (ii) in all other cases, an Opinion of Counsel satisfactory to it that
such
transfer may be made without such registration or qualification (which Opinion
of Counsel shall not be an expense of the Trust Fund or of the Depositor,
the
Securities Administrator or the Trustee in their respective capacities as
such),
together with copies of the written certification(s) of the Holder of the
Certificate desiring to effect the transfer and/or such Holder’s prospective
transferee upon which such Opinion of Counsel is based. Neither the Depositor
nor the Trustee is obligated to register or qualify the Class of Certificates
specified on the face hereof under the 1933 Act or any other securities law
or
to take any action not otherwise required under the Agreement to permit the
transfer of such Certificates without registration or qualification. Any
Holder
desiring to effect a transfer of this Certificate shall be required to indemnify
the Trustee, the Securities Administrator, the Depositor and the Sponsor
against
any liability that may result if the transfer is not so exempt or is not
made in
accordance with such federal and state laws.
No
transfer of this Certificate shall be made to any person unless the transferee
provides a certification pursuant to Section 6.02(b) of the
Agreement.
This
Certificate is one of a duly authorized issue of Certificates designated
as set
forth on the face hereof (the “Certificates”). The Certificates, in the
aggregate, evidence the entire beneficial ownership interest in the Trust
Fund
relating to the Mortgage Loans and the Supplemental Interest Trust formed
pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that the Securities
Administrator is not liable to the Certificateholders for any amount payable
under this Certificate or the Agreement or, except as expressly provided
in the
Agreement, subject to any liability under the Agreement.
This
Certificate does not purport to summarize the Agreement and reference is
made to
the Agreement for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced hereby, and the rights, duties and immunities
of the Securities Administrator. This Certificate is limited in right of
payment
to certain collections and recoveries respecting the Mortgage Loans and other
assets included in the Trust fund relating to the Mortgage Loans and the
Supplemental Interest Trust, all as more specifically set forth in the
Agreement.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of the Class or Classes
of
Certificates affected thereby evidencing over 50% of the Voting Rights of
such
Class or Classes. Any such consent by the Holder of this Certificate shall
be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the
Certificates.
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable with the Securities
Administrator upon surrender of this Certificate for registration of transfer
at
the offices or agencies maintained by the Securities Administrator for such
purposes, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator duly executed by the
Holder
hereof or such Holder’s attorney duly authorized in writing, and thereupon one
or more new Certificates in authorized denominations representing a like
aggregate Percentage Interest will be issued to the designated
transferee.
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the Certificateholders for any such registration
of transfer, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee, the Securities
Administrator and any agent of any of them may treat the Person in whose
name
this Certificate is registered as the owner hereof for all purposes, and
none of
the Depositor, the Master Servicer, the Trustee, the Securities Administrator
or
any such agent shall be affected by notice to the contrary.
The
obligations created by the Agreement and the Trust Fund created thereby (other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund subject to additional terms
set forth in the Agreement. Such optional repurchase may be made (i) by the
Master Servicer only if on such Distribution Date the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 10% of the Cut-off
Date
Principal Balance of the Mortgage Loans and (ii) by Ocwen Loan Servicing,
LLC
only if on such Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 5% of the Cut-off
Date
Principal Balance of the Mortgage Loans. The exercise of such right will
effect
the early retirement of the Certificates. Notwithstanding the foregoing,
the
Master Servicer shall not be entitled to exercise the Cleanup Call to the
extent
that the Depositor creates a net interest margin transaction which includes
the
Class X Certificates or Class P Certificates and the notes issued pursuant
to
such net interest margin transaction are outstanding on the date on which
the
Master Servicer intends to exercise the Cleanup Call. In no event, however,
will
the Trust Fund created by the Agreement continue beyond the earlier of (i)
the
expiration of 21 years after the death of certain persons identified in the
Agreement and (ii) the Assumed Final Distribution Date.
Unless
this Certificate has been countersigned by an authorized signatory of the
Securities Administrator by manual signature, this Certificate shall not
be
entitled to any benefit under the Agreement, or be valid for any
purpose.
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
Dated:
January __, 2007
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
||
|
By:
|
||
|
Authorized
Signatory
|
||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class X Certificates referred to in the within-mentioned
Agreement.
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and address
including postal zip code of assignee) a Percentage Interest evidenced by
the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of a
like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:
|
.
|
|
Dated:
|
______________________________________
|
|
Signature
by or on behalf of assignor
|
|
|
______________________________________
|
|
|
Signature
Guaranteed
|
DISTRIBUTION
INSTRUCTIONS
The
assignee should include the following for purposes of distribution:
|
Distributions
shall be made, by wire transfer or otherwise, in immediately available
|
|||||||
|
funds
to
|
|||||||
|
for
the account of
|
|||||||
|
account
number
|
or,
if mailed by check, to
|
||||||
|
Applicable
statements should be mailed to
|
|||||||
|
This
information is provided by
|
|||||||
|
assignee
named above, or
|
|||||||
|
its
agent.
|
|||||||
EXHIBIT
A-5
FORM
OF CLASS P CERTIFICATE
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “REGULAR INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986
(THE “CODE”).
THIS
CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES LAWS. THE
HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE
MAY
BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE
WITH
THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE
144A
UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
(A
“QIB”), PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF
A
QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT
TO
AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES
ACT (IF
AVAILABLE) OR (3) TO AN “INSTITUTIONAL ACCREDITED INVESTOR” WITHIN THE MEANING
THEREOF IN RULE 501(a)(1), (2), (3) or (7) OF REGULATION D UNDER THE ACT
OR ANY
ENTITY IN WHICH ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS PURCHASING
NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO (A) THE
RECEIPT BY THE SECURITIES ADMINISTRATOR OF A LETTER SUBSTANTIALLY IN THE
FORM
PROVIDED IN THE AGREEMENT AND (B) THE RECEIPT BY THE SECURITIES ADMINISTRATOR
OF
SUCH OTHER EVIDENCE ACCEPTABLE TO THE SECURITIES ADMINISTRATOR THAT SUCH
REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE SECURITIES
ACT AND
OTHER APPLICABLE LAWS OR IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE
SECURITIES LAWS OF THE UNITED STATES AND ANY OTHER APPLICABLE
JURISDICTION.
NO
TRANSFER OF THIS CERTIFICATE SHALL BE MADE TO ANY PERSON, UNLESS THE TRANSFEREE
PROVIDES A CERTIFICATION PURSUANT TO SECTION 6.02(b) OF THE
AGREEMENT.
|
Certificate
No. [__]
|
Percentage
Interest: 100%
|
|
Class
P
|
|
|
Date
of Pooling and Servicing Agreement and Cut-off Date:
January
1, 2007
|
Aggregate
Initial Certificate Principal Balance of the Class P Certificates
as of
the Cut-off Date: $100
|
|
Trustee:
HSBC Bank USA, National Association
|
Master
Servicer and Securities Administrator: Xxxxx Fargo Bank,
N.A.
|
|
First
Distribution Date: February 25, 2007
|
|
|
Assumed
Final Distribution Date:
January
25, 2037
|
CUSIP:
[________________]
|
ASSET-BACKED
CERTIFICATE
SERIES
2007-2
evidencing
a fractional undivided interest in the distributions allocable to the Class
P
Certificates with respect to a Trust Fund consisting primarily of a pool
of
conventional one- to four-family fixed-rate and adjustable-rate mortgage
loans
sold by NOMURA HOME EQUITY LOAN, INC.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Nomura Home Equity Loan, Inc.
(“NHEL”), the Securities Administrator or the Trustee or any of their affiliates
or any other person. Neither this Certificate nor the underlying Mortgage
Loans
are guaranteed or insured by any governmental entity or by NHEL, the Securities
Administrator or the Trustee or any of their affiliates or any other person.
None of NHEL, the Trustee, the Securities Administrator or any of their
affiliates will have any obligation with respect to any certificate or other
obligation secured by or payable from payments on the Certificates.
This
certifies that [____________] is the registered owner of the Percentage Interest
evidenced hereby in the beneficial ownership interest of Certificates of
the
same Class as this Certificate in a trust (the “Trust Fund”), generally
consisting of conventional first and second lien, fixed-rate and adjustable-rate
mortgage loans secured by one- to four- family residences, units in planned
unit
developments, individual condominium units and townhouses (collectively,
the
“Mortgage Loans”) sold by NHEL. The Mortgage Loans were sold by Nomura Credit
& Capital, Inc. (the “Sponsor”) to NHEL. The Trust Fund was created pursuant
to the Pooling and Servicing Agreement dated as of the Cut-off Date specified
above (the “Agreement”), among NHEL, as depositor (the “Depositor”), the
Sponsor, Ocwen Loan Servicing, LLC, as a servicer, Equity One, Inc., as a
servicer, Select Portfolio Servicing, LLC, as a servicer, Xxxxx Fargo Bank,
N.A., as master servicer (the “Master Servicer”) and securities administrator
(the “Securities Administrator”) and HSBC Bank USA, National Association, as
trustee (the “Trustee”), a summary of certain of the pertinent provisions of
which is set forth xxxxxxxxx.Xx the extent not defined herein, capitalized
terms
used herein shall have the meaning ascribed to them in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of its acceptance hereof assents and by which such Holder is
bound.
The
Securities Administrator will distribute on the 25th day of each month, or,
if
such 25th day is not a Business Day, the immediately following Business Day
(each, a “Distribution Date”), commencing on the First Distribution Date
specified above, to the Person in whose name this Certificate is registered
at
the close of business on the last day (or if such last day is not a Business
Day, the Business Day immediately preceding such last day) of the calendar
month
immediately preceding the month in which the Distribution Date occurs, an
amount
equal to the product of the Percentage Interest evidenced by this Certificate
and the amount required to be distributed to the Holders of Certificates
of the
same Class as this Certificate. The Assumed Final Distribution Date is the
Distribution Date in the month following the latest scheduled maturity date
of
any Mortgage Loan.
Distributions
on this Certificate will be made by the Securities Administrator by check
mailed
to the address of the Person entitled thereto as such name and address shall
appear on the Certificate Register or, if such Person so requests by notifying
the Securities Administrator in writing as specified in the Agreement.
Notwithstanding the above, the final distribution on this Certificate will
be
made after due notice by the Securities Administrator of the pendency of
such
distribution and only upon presentation and surrender of this Certificate
at the
office or agency appointed by the Securities Administrator for that purpose
and
designated in such notice.
No
transfer of this Certificate shall be made unless the transfer is made pursuant
to an effective registration statement under the Securities Act of 1933,
as
amended (the “1933 Act”), and an effective registration or qualification under
applicable state securities laws, or is made in a transaction that does not
require such registration or qualification. In the event that such a transfer
of
this Certificate is to be made without registration or qualification, the
Securities Administrator shall require receipt of (i) if such transfer is
purportedly being made in reliance upon Rule 144A under the 1933 Act, written
certifications from the Holder of the Certificate desiring to effect the
transfer, and from such Holder’s prospective transferee, substantially in the
forms attached to the Agreement as Exhibit E and either F or G, as applicable,
and (ii) in all other cases, an Opinion of Counsel satisfactory to it that
such
transfer may be made without such registration or qualification (which Opinion
of Counsel shall not be an expense of the Trust Fund or of the Depositor,
the
Securities Administrator or the Trustee in their respective capacities as
such),
together with copies of the written certification(s) of the Holder of the
Certificate desiring to effect the transfer and/or such Holder’s prospective
transferee upon which such Opinion of Counsel is based. Neither the Depositor,
the Securities Administrator nor the Trustee is obligated to register or
qualify
the Class of Certificates specified on the face hereof under the 1933 Act
or any
other securities law or to take any action not otherwise required under the
Agreement to permit the transfer of such Certificates without registration
or
qualification. Any Holder desiring to effect a transfer of this Certificate
shall be required to indemnify the Trustee, the Securities Administrator,
the
Depositor and the Sponsor against any liability that may result if the transfer
is not so exempt or is not made in accordance with such federal and state
laws.
No
transfer of this Certificate shall be made to any person unless the transferee
provides a certification pursuant to Section 6.02(b) of the
Agreement.
This
Certificate is one of a duly authorized issue of Certificates designated
as set
forth on the face hereof (the “Certificates”). The Certificates, in the
aggregate, evidence the entire beneficial ownership interest in the Trust
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that the Securities
Administrator is not liable to the Certificateholders for any amount payable
under this Certificate or the Agreement or, except as expressly provided
in the
Agreement, subject to any liability under the Agreement.
This
Certificate does not purport to summarize the Agreement and reference is
made to
the Agreement for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced hereby, and the rights, duties and immunities
of the Securities Administrator. This Certificate is limited in right of
payment
to Prepayment Charges collected in respect of the Mortgage Loans and amounts
on
deposit in the Class P Certificate Account as more specifically set forth
in the
Agreement.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of the Class or Classes
of
Certificates affected thereby evidencing over 50% of the Voting Rights of
such
Class or Classes. Any such consent by the Holder of this Certificate shall
be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the
Certificates.
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable with the Securities
Administrator upon surrender of this Certificate for registration of transfer
at
the offices or agencies maintained by the Securities Administrator for such
purposes, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator duly executed by the
Holder
hereof or such Holder’s attorney duly authorized in writing, and thereupon one
or more new Certificates in authorized denominations representing a like
aggregate Percentage Interest will be issued to the designated
transferee.
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the Certificateholders for any such registration
of transfer, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee, the Securities
Administrator and any agent of any of them may treat the Person in whose
name
this Certificate is registered as the owner hereof for all purposes, and
none of
the Depositor, the Master Servicer, the Trustee, the Securities Administrator
or
any such agent shall be affected by notice to the contrary.
The
obligations created by the Agreement and the Trust Fund created thereby (other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund subject to additional terms
set forth in the Agreement. Such optional repurchase may be made (i) by the
Master Servicer only if on such Distribution Date the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 10% of the Cut-off
Date
Principal Balance of the Mortgage Loans and (ii) by Ocwen Loan Servicing,
LLC
only if on such Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 5% of the Cut-off
Date
Principal Balance of the Mortgage Loans. The exercise of such right will
effect
the early retirement of the Certificates. Notwithstanding the foregoing,
the
Master Servicer shall not be entitled to exercise the Cleanup Call to the
extent
that the Depositor creates a net interest margin transaction which includes
the
Class X Certificates or Class P Certificates and the notes issued pursuant
to
such net interest margin transaction are outstanding on the date on which
the
Master Servicer intends to exercise the Cleanup Call. In no event, however,
will
the Trust Fund created by the Agreement continue beyond the earlier of (i)
the
expiration of 21 years after the death of certain persons identified in the
Agreement and (ii) the Assumed Final Distribution Date.
Unless
this Certificate has been countersigned by an authorized signatory of the
Securities Administrator by manual signature, this Certificate shall not
be
entitled to any benefit under the Agreement, or be valid for any
purpose.
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
Dated:
January __, 2007
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
||
|
By:
|
||
|
Authorized
Signatory
|
||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class P Certificates referred to in the within-mentioned
Agreement.
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and address
including postal zip code of assignee) a Percentage Interest evidenced by
the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of a
like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:
|
.
|
|
Dated:
|
|
|
Signature
by or on behalf of assignor
|
|
|
Signature
Guaranteed
|
DISTRIBUTION
INSTRUCTIONS
The
assignee should include the following for purposes of distribution:
|
Distributions
shall be made, by wire transfer or otherwise, in immediately available
|
|||||||
|
funds
to
|
|||||||
|
for
the account of
|
|||||||
|
account
number
|
or,
if mailed by check, to
|
||||||
|
Applicable
statements should be mailed to
|
|||||||
|
This
information is provided by
|
|||||||
|
assignee
named above, or
|
|||||||
|
its
agent.
|
|||||||
EXHIBIT
A-6
FORM
OF CLASS R[-X] CERTIFICATE
THIS
CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A NON-UNITED STATES PERSON
OR A
DISQUALIFIED ORGANIZATION (AS DEFINED BELOW).
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “RESIDUAL INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT” AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986
(THE “CODE”).
NO
TRANSFER OF THIS CERTIFICATE SHALL BE MADE TO ANY PERSON, UNLESS THE TRANSFEREE
PROVIDES A CERTIFICATION PURSUANT TO SECTION 6.02(b) OF THE
AGREEMENT.
ANY
RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
IF
THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE SECURITIES
ADMINISTRATOR THAT (1) SUCH TRANSFEREE IS NOT (A) THE UNITED STATES, ANY
STATE
OR POLITICAL SUBDIVISION THEREOF, ANY POSSESSION OF THE UNITED STATES, OR
ANY
AGENCY OR INSTRUMENTALITY OF ANY OF THE FOREGOING (OTHER THAN AN INSTRUMENTALITY
WHICH IS A CORPORATION IF ALL OF ITS ACTIVITIES ARE SUBJECT TO TAX AND EXCEPT
FOR XXXXXXX MAC, A MAJORITY OF ITS BOARD OF DIRECTORS IS NOT SELECTED BY
SUCH
GOVERNMENTAL UNIT), (B) A FOREIGN GOVERNMENT, ANY INTERNATIONAL ORGANIZATION,
OR
ANY AGENCY OR INSTRUMENTALITY OF EITHER OF THE FOREGOING, (C) ANY ORGANIZATION
(OTHER THAN CERTAIN FARMERS’ COOPERATIVES 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 (INCLUDING
THE TAX IMPOSED BY SECTION 511 OF THE CODE ON UNRELATED BUSINESS TAXABLE
INCOME), (D) RURAL ELECTRIC AND TELEPHONE COOPERATIVES DESCRIBED IN SECTION
1381(a)(2)(C) OF THE CODE, (E) AN ELECTING LARGE PARTNERSHIP UNDER SECTION
775(a) OF THE CODE (ANY SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A),
(B),
(C), (D) OR (E) BEING HEREIN REFERRED TO AS A “DISQUALIFIED ORGANIZATION”), OR
(F) AN AGENT OF A DISQUALIFIED ORGANIZATION, (2) NO PURPOSE OF SUCH TRANSFER
IS
TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX AND (3) SUCH TRANSFEREE SATISFIES
CERTAIN ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE
PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE
REGISTER OR ANY TRANSFER, SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO
A
DISQUALIFIED ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH
REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER
AND
SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE
HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON
THIS
CERTIFICATE. EACH HOLDER OF THIS CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE
SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS
PARAGRAPH.
|
Certificate
No. [__]
|
|
|
Class
R[-X]
|
Percentage
Interest: [__]
|
|
Date
of Pooling and Servicing Agreement
and
Cut-off Date: January 1, 2007
|
|
|
Trustee:
HSBC Bank USA, National Association
|
Master
Servicer and Securities Administrator: Xxxxx Fargo Bank,
N.A.
|
|
First
Distribution Date: February 25, 2007
|
|
|
Assumed
Final Distribution Date:
January
25, 2037
|
CUSIP:
[_______________]
|
ASSET-BACKED
CERTIFICATE
SERIES
2007-2
evidencing
a fractional undivided interest in the distributions allocable to the Class
R[-X] Certificates
with respect to a Trust Fund consisting primarily of a pool of conventional
one-
to four-family fixed-rate and adjustable-rate mortgage loans sold by NOMURA
HOME
EQUITY LOAN, INC.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Nomura Home Equity Loan, Inc.
(“NHEL”), the Securities Administrator or the Trustee or any of their affiliates
or any other person. Neither this Certificate nor the underlying Mortgage
Loans
are guaranteed or insured by any governmental entity or by NHEL, the Securities
Administrator or the Trustee or any of their affiliates or any other person.
None of NHEL, the Trustee, the Securities Administrator or any of their
affiliates will have any obligation with respect to any certificate or other
obligation secured by or payable from payments on the Certificates.
This
certifies that [____________] is the registered owner of the Percentage Interest
evidenced hereby in the beneficial ownership interest of Certificates of
the
same Class as this Certificate in a trust (the “Trust Fund”), generally
consisting
of conventional
first and second lien, fixed-rate and adjustable-rate mortgage loans secured
by
one- to four- family residences, units in planned unit developments, individual
condominium units and townhouses (collectively, the “Mortgage Loans”) sold by
NHEL. The Mortgage Loans were sold by Nomura Credit & Capital, Inc. (the
“Sponsor”) to NHEL. The Trust Fund was created pursuant to the Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
“Agreement”), among NHEL, as depositor (the “Depositor”), the Sponsor, Ocwen
Loan Servicing, LLC, as a servicer, Equity One, Inc., as a servicer, Select
Portfolio Servicing, LLC, as a servicer, Xxxxx Fargo Bank, N.A., as master
servicer (the “Master Servicer”) and securities administrator (the “Securities
Administrator”) and HSBC Bank USA, National Association, as trustee (the
“Trustee”), a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, capitalized terms used
herein
shall have the meaning ascribed to them in the Agreement. This Certificate
is
issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of
its
acceptance hereof assents and by which such Holder is bound.
Each
Holder of this Certificate will be deemed to have agreed to be bound by the
restrictions set forth in the Agreement to the effect that (i) each person
holding or acquiring any Ownership Interest in this Certificate must be a
United
States Person and a Permitted Transferee, (ii) the transfer of any Ownership
Interest in this Certificate will be conditioned upon the delivery to the
Securities Administrator of, among other things, an affidavit to the effect
that
it is a United States Person and Permitted Transferee, (iii) any attempted
or
purported transfer of any Ownership Interest in this Certificate in violation
of
such restrictions will be absolutely null and void and will vest no rights
in
the purported transferee, and (iv) if any person other than a United States
Person and a Permitted Transferee acquires any Ownership Interest in this
Certificate in violation of such restrictions, then the Depositor will have
the
right, in its sole discretion and without notice to the Holder of this
Certificate, to sell this Certificate to a purchaser selected by the Depositor,
which purchaser may be the Depositor, or any affiliate of the Depositor,
on such
terms and conditions as the Depositor may choose.
The
Securities Administrator will distribute on the 25th day of each month, or,
if
such 25th day is not a Business Day, the immediately following Business Day
(each, a “Distribution Date”), commencing on the First Distribution Date
specified above, to the Person in whose name this Certificate is registered
at
the close of business on the last day (or if such last day is not a Business
Day, the Business Day immediately preceding such last day) of the calendar
month
immediately preceding the month in which the Distribution Date occurs, an
amount
equal to the product of the Percentage Interest evidenced by this Certificate
and the amounts required to be distributed to the Holders of Certificates
of the
same Class as this Certificate. The Assumed Final Distribution Date is the
Distribution Date in the month following the latest scheduled maturity date
of
any Mortgage Loan.
Distributions
on this Certificate will be made by the Securities Administrator by check
mailed
to the address of the Person entitled thereto as such name and address shall
appear on the Certificate Register or, if such Person so requests by notifying
the Securities Administrator in writing as specified in the Agreement.
Notwithstanding the above, the final distribution on this Certificate will
be
made after due notice by the Securities Administrator of the pendency of
such
distribution and only upon presentation and surrender of this Certificate
at the
office or agency appointed by the Securities Administrator for that purpose
and
designated in such notice.
No
transfer of this Certificate shall be made to any person unless the transferee
provides a certification pursuant to Section 6.02(b) of the
Agreement.
This
Certificate is one of a duly authorized issue of Certificates designated
as set
forth on the face hereof (the “Certificates”). The Certificates, in the
aggregate, evidence the entire beneficial ownership interest in the Trust
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that the Trustee
is not
liable to the Certificateholders for any amount payable under this Certificate
or the Agreement or, except as expressly provided in the Agreement, subject
to
any liability under the Agreement.
This
Certificate does not purport to summarize the Agreement and reference is
made to
the Agreement for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced hereby, and the rights, duties and immunities
of the Securities Administrator. This Certificate is limited in right of
payment
to certain collections and recoveries respecting the Mortgage Loans and other
assets included in the Trust Fund (including the Swap Agreement), all as
more
specifically set forth in the Agreement.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of the Class or Classes
of
Certificates affected thereby evidencing over 50% of the Voting Rights of
such
Class or Classes. Any such consent by the Holder of this Certificate shall
be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the
Certificates.
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable with the Securities
Administrator upon surrender of this Certificate for registration of transfer
at
the offices or agencies maintained by the Securities Administrator for such
purposes, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator duly executed by the
Holder
hereof or such Holder’s attorney duly authorized in writing, and thereupon one
or more new Certificates in authorized denominations representing a like
aggregate Percentage Interest will be issued to the designated
transferee.
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the Certificateholders for any such registration
of transfer, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee, the Securities
Administrator and any agent of any of them may treat the Person in whose
name
this Certificate is registered as the owner hereof for all purposes, and
none of
the Depositor, the Master Servicer, the Trustee, the Securities Administrator
or
any such agent shall be affected by notice to the contrary.
The
obligations created by the Agreement and the Trust Fund created thereby (other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund subject to additional terms
set forth in the Agreement. Such optional repurchase may be made (i) by the
Master Servicer only if on such Distribution Date the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 10% of the Cut-off
Date
Principal Balance of the Mortgage Loans and (ii) by Ocwen Loan Servicing,
LLC
only if on such Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 5% of the Cut-off
Date
Principal Balance of the Mortgage Loans. The exercise of such right will
effect
the early retirement of the Certificates. Notwithstanding the foregoing,
the
Master Servicer shall not be entitled to exercise the Cleanup Call to the
extent
that the Depositor creates a net interest margin transaction which includes
the
Class X Certificates or Class P Certificates and the notes issued pursuant
to
such net interest margin transaction are outstanding on the date on which
the
Master Servicer intends to exercise the Cleanup Call. In no event, however,
will
the Trust Fund created by the Agreement continue beyond the earlier of (i)
the
expiration of 21 years after the death of certain persons identified in the
Agreement and (ii) the Assumed Final Distribution Date.
Unless
this Certificate has been countersigned by an authorized signatory of the
Securities Administrator by manual signature, this Certificate shall not
be
entitled to any benefit under the Agreement, or be valid for any
purpose.
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
Dated:
January __, 2007
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
||
|
By:
|
||
|
Authorized
Signatory
|
||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class R[-X] Certificates referred to in the within-mentioned
Agreement.
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and address
including postal zip code of assignee) a Percentage Interest evidenced by
the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of a
like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:
|
.
|
|
Dated:
|
|
|
Signature
by or on behalf of assignor
|
|
|
Signature
Guaranteed
|
DISTRIBUTION
INSTRUCTIONS
The
assignee should include the following for purposes of distribution:
|
Distributions
shall be made, by wire transfer or otherwise, in immediately available
|
|||||||
|
funds
to
|
|||||||
|
for
the account of
|
|||||||
|
account
number
|
or,
if mailed by check, to
|
||||||
|
Applicable
statements should be mailed to
|
|||||||
|
This
information is provided by
|
|||||||
|
assignee
named above, or
|
|||||||
|
its
agent.
|
|||||||
EXHIBIT
B
MORTGAGE
LOAN SCHEDULE
The
Preliminary and Final Mortgage Loan Schedules shall set forth the following
information with respect to each Mortgage Loan:
| a) |
the
Mortgage Loan identifying number;
|
| b) |
a
code indicating to which Loan Group a Mortgage Loan has been assigned,
if
applicable;
|
| c) |
a
code indicating whether the Mortgaged Property is
owner-occupied;
|
| d) |
the
type of Residential Dwelling constituting the Mortgaged
Property;
|
| e) |
the
original months to maturity;
|
| f) |
the
original date of the Mortgage Loan and the remaining months to
maturity
from the Cut-off Date, based on the original amortization
schedule;
|
| g) |
the
Loan-to-Value Ratio or Combined Loan-to-Value Ratio, as applicable,
at
origination;
|
| h) |
the
Mortgage Rate in effect immediately following the Cut-off
Date;
|
| i) |
the
date on which the first Monthly Payment was due on the Mortgage
Loan;
|
| j) |
the
stated maturity date;
|
| k) |
the
amount of the Monthly Payment at
origination;
|
| l) |
the
amount of the Monthly Payment as of the Cut-off
Date;
|
| m) |
the
last Due Date on which a Monthly Payment was actually applied to
the
unpaid Stated Principal Balance;
|
| n) |
the
original principal amount of the Mortgage
Loan;
|
| o) |
the
Stated Principal Balance of the Mortgage Loan as of the close of
business
on the Cut-off Date;
|
| p) |
with
respect to each adjustable rate Mortgage Loan, the first Adjustment
Date;
|
| q) |
with
respect to each adjustable rate Mortgage Loan, the Gross
Margin;
|
| r) |
a
code indicating the purpose of the loan (i.e., purchase financing,
rate/term refinancing, cash-out
refinancing);
|
| s) |
with
respect to each adjustable rate Mortgage Loan, the Maximum Mortgage
Rate
under the terms of the Mortgage
Note;
|
| t) |
with
respect to each adjustable rate Mortgage Loan, the Minimum Mortgage
Rate
under the terms of the Mortgage
Note;
|
| u) |
the
Mortgage Rate at origination;
|
| v) |
with
respect to each adjustable rate Mortgage Loan, the Periodic Rate
Cap;
|
| w) |
with
respect to each adjustable rate Mortgage Loan, the first Adjustment
Date
immediately following the Cut-off
Date;
|
| x) |
with
respect to each adjustable rate Mortgage Loan, the
Index;
|
| y) |
the
date on which the first Monthly Payment was due on the Mortgage
Loan and,
if such date is not consistent with the Due Date currently in effect,
such
Due Date;
|
| z) |
a
code indicating whether the Mortgage Loan is an Adjustable Rate
Mortgage
Loan or a fixed rate Mortgage Loan;
|
| aa) |
a
code indicating the documentation style (i.e., full, stated or
limited);
|
| bb) |
a
code indicating if the Mortgage Loan is subject to a primary insurance
policy or lender paid mortgage insurance policy and the name of
the
insurer;
|
| cc) |
the
Appraised Value of the Mortgaged
Property;
|
| dd) |
the
sale price of the Mortgaged Property, if
applicable;
|
| ee) |
a
code indicating whether the Mortgage Loan is subject to a Prepayment
Charge, the term of such Prepayment Charge and the amount of such
Prepayment Charge;
|
| ff) |
the
product type (e.g., 2/28, 15 year fixed, 30 year fixed, 15/30 balloon,
etc.);
|
| gg) |
the
Mortgagor’s debt to income ratio at
origination;
|
| hh) |
the
FICO score at origination;
|
| ii) |
the
Servicer; and
|
| jj) |
a
code indicating whether the Mortgage Loan is a secured by either
a first
lien Mortgage Loan or a second lien Mortgage
Loan.
|
EXHIBIT C
MORTGAGE
LOAN PURCHASE AGREEMENT
This
is a
Mortgage Loan Purchase Agreement (this “Agreement”), dated January 31, 2007,
between Nomura Credit & Capital, Inc., a Delaware corporation (the “Seller”)
and Nomura Home Equity Loan, Inc., a Delaware corporation (the
“Purchaser”).
Preliminary
Statement
The
Seller intends to sell the Mortgage Loans (as hereinafter identified) and
any
rights of the Seller in, to and under the Basis Risk Cap Agreement, the
Swap
Agreement and the Interest Rate Cap Agreement (exclusive of upfront premiums
paid by the provider of the Basis Risk Cap Agreement, the Swap Agreement
and the
Interest Rate Cap Agreement, if any, payable on the Closing Date) to the
Purchaser on the terms and subject to the conditions set forth in this
Agreement. The Purchaser intends to deposit the Mortgage Loans into a mortgage
pool comprising the Trust Fund. The Trust Fund will be evidenced by a single
series of asset-backed certificates designated as Nomura Home Equity Loan,
Inc.,
Home Equity Loan Trust, Series 2007-2, Asset-Backed Certificates (the
“Certificates”). The Certificates will consist of nineteen (19) classes of
certificates. The Certificates will be issued pursuant to a pooling and
servicing agreement, dated as of January 1, 2007 (the “Pooling and Servicing
Agreement”), among the Purchaser as depositor, Ocwen Loan Servicing, LLC
(“Ocwen”), as a servicer, Equity One, Inc. (“Equity One”), as a servicer, Select
Portfolio Servicing, LLC (“SPS”), as a servicer, Xxxxx Fargo Bank, N.A. (“Xxxxx
Fargo”) as master servicer and securities administrator, the Seller as sponsor
and HSBC Bank USA, National Association as trustee (the “Trustee”). The
Purchaser will sell the Class I-A-1, Class II-A-1, Class II-A-2, Class
II-A-3,
Class II-A-4, Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class
M-6,
Class M-7, Class M-8, and Class M-9 Certificates to Greenwich Capital Markets,
Inc. (“Greenwich”), Citigroup Global Markets Inc. (“Citigroup”) and UBS
Securities LLC (“UBS”, together with Greenwich and Citigroup, the
“Underwriters”), pursuant to the Underwriting Agreement, dated January 30, 2007,
among the Purchaser and the Underwriters and the Terms Agreement, dated
January
30, 2007, among the Purchaser and the Underwriters. The
Purchaser will sell the Class B-1 Certificates to Greenwich pursuant to
the
Purchase Agreement, dated as of January 31, 2007, between the Purchaser
and
Greenwich. Capitalized terms used but not defined herein shall have the
meanings
set forth in the Pooling and Servicing Agreement. Pursuant to the custodial
agreement, dated as of January 1, 2007 (the “Custodial Agreement”), among the
Trustee, Ocwen as a servicer, Equity One as a servicer, SPS as a servicer,
Xxxxx
Fargo as a servicer (Xxxxx Fargo, together with Ocwen, Equity One and SPS,
the
“Servicers”) and Xxxxx Fargo as custodian (the “Custodian”), the Trustee intends
to have the Custodian take possession of the Mortgages and Mortgage Notes,
along
with certain other documents specified in the Custodial Agreement, as the
custodian of the Trustee, in accordance with the terms and conditions
thereof.
The
parties hereto agree as follows:
SECTION
1. Agreement
to Purchase.
The
Seller hereby sells, and the Purchaser hereby purchases, on January 31,
2007
(the “Closing Date”), (a) certain conventional, one-to-four family, fixed-rate
and adjustable-rate mortgage loans secured by first or second liens on
residential real properties (the “Mortgage Loans”), having an aggregate
principal balance as of the close of business on January 1, 2007 (the “Cut-off
Date”) of approximately $930,628,299 (the “Closing Balance”), after giving
effect to all payments due on the Mortgage Loans on or before the Cut-off
Date,
whether or not received, including the right to any Prepayment Charges
payable
by the related Mortgagors in connection with any Principal Prepayments
on the
Mortgage Loans and (b) the rights under the Basis Risk Cap Agreement, the
Swap
Agreement and the Interest Rate Cap Agreement (exclusive of upfront premiums
paid by the provider of the Basis Risk Cap Agreement, the Swap Agreement
and the
Interest Rate Cap Agreement, if any, payable on the Closing Date).
SECTION
2. Mortgage
Loan Schedule.
The
Purchaser and the Seller have agreed upon which of the mortgage loans owned
by
the Seller are to be purchased by the Purchaser pursuant to this Agreement
and
the Seller will prepare or cause to be prepared on or prior to the Closing
Date
a final schedule (the “Closing Schedule”) that describes such Mortgage Loans and
sets forth all of the Mortgage Loans to be purchased under this Agreement,
including the Prepayment Charges. The Closing Schedule will conform to
the
requirements set forth in this Agreement and to the definition of “Mortgage Loan
Schedule” under the Pooling and Servicing Agreement.
SECTION
3. Consideration.
(a) In
consideration for the Mortgage Loans and the rights under the Basis Risk
Cap
Agreement, the Swap Agreement and the Interest Rate Cap Agreement (exclusive
of
any upfront premium paid by the provider of the Basis Risk Cap Agreement,
the
Swap Agreement and the Interest Rate Cap Agreement, if any, payable on
the
Closing Date) to be purchased hereunder, the Purchaser shall, as described
in
Section 10, (i) pay to or upon the order of the Seller in immediately available
funds an amount (the “Purchase Price”) equal to (i) [_______]*
and (ii)
a 100% interest in the Class B-1, Class X, Class P, Class R and Class R-X
Certificates of which the Class B-1 Certificates shall be registered in
the name
of Cede & Co., the Class X, Class P, Class R Certificates and Class R-X
Certificates shall be registered solely in the name of Nomura Credit &
Capital, Inc.
(b) The
Purchaser or any assignee, transferee or designee of the Purchaser shall
be
entitled to all scheduled payments of principal due after the Cut-off Date,
all
other payments of principal due and collected after the Cut-off Date, and
all
payments of interest on the Mortgage Loans allocable to the period after
the
Cut-off Date. All scheduled payments of principal and interest due on or
before
the Cut-off Date and collected after the Cut-off Date shall belong to the
Seller.
(c) Pursuant
to the Pooling and Servicing Agreement, the Purchaser will assign all of its
right, title and interest in and to the Mortgage Loans, the Basis Risk
Cap
Agreement, the Swap Agreement, and the Interest Rate Cap Agreement (exclusive
of
upfront premiums paid by the provider of the Basis Risk Cap Agreement,
the Swap
Agreement and the Interest Rate Cap Agreement, if any, payable on the Closing
Date) together with its rights under this Agreement, to the Trustee for
the
benefit of the Certificateholders.
SECTION
4. Transfer
of the Mortgage Loans.
(a) Possession
of Mortgage Files.
The
Seller does hereby sell to the Purchaser, without recourse but subject
to the
terms of this Agreement, all of its right, title and interest in, to and
under
the Mortgage Loans, including the related Prepayment Charges, the Basis
Risk Cap
Agreement, the Swap Agreement, and the Interest Rate Cap Agreement (exclusive
of
upfront premiums paid by the provider of the Basis Risk Cap Agreement,
the Swap
Agreement and the Interest Rate Cap Agreement, if any, payable on the Closing
Date). The contents of each Mortgage File not delivered to the Purchaser
or to
any assignee, transferee or designee of the Purchaser on or prior to the
Closing
Date are and shall be held in trust by the Seller for the benefit of the
Purchaser or any assignee, transferee or designee of the Purchaser. Upon
the
sale of the Mortgage Loans, the ownership of each Mortgage Note, the related
Mortgage and the other contents of the related Mortgage File is vested
in the
Purchaser and the ownership of all records and documents with respect to
the
related Mortgage Loan prepared by or that come into the possession of the
Seller
on or after the Closing Date shall immediately vest in the Purchaser and
shall
be delivered immediately to the Purchaser or as otherwise directed by the
Purchaser.
(b) Delivery
of Mortgage Loan Documents.
Pursuant
to various conveyance documents to be executed on the Closing Date and
pursuant
to the Pooling and Servicing Agreement, the Purchaser will assign on the
Closing
Date all of its right, title and interest in and to the Mortgage Loans
to the
Trustee for the benefit of the Certificateholders. In connection with the
transfer and assignment of the Mortgage Loans, the Seller has delivered
or will
deliver or cause to be delivered to the Trustee by the Closing Date or
such
later date as is agreed to by the Purchaser and the Seller (each of the
Closing
Date and such later date is referred to as a “Mortgage
File Delivery Date”),
the
documents set forth on Exhibit
1
hereto,
provided,
however,
that in
lieu of the foregoing, the Seller may deliver the following documents,
under the
circumstances set forth below: (x) in lieu of the original Mortgage, assignments
to the Trustee or intervening assignments thereof which have been delivered,
are
being delivered or will upon receipt of recording information relating
to the
Mortgage required to be included thereon, be delivered to recording offices
for
recording and have not been returned in time to permit their delivery as
specified above, the Seller may deliver a true copy thereof with a certification
by the Seller on the face of such copy, substantially as follows: “Certified to
be a true and correct copy of the original, which has been transmitted
for
recording”; (y) in lieu of the Mortgage, assignments to the Trustee or
intervening assignments thereof, if the applicable jurisdiction retains
the
originals of such documents or if the originals are lost (in each case,
as
evidenced by a certification from the Seller to such effect), the Seller
may
deliver photocopies of such documents containing an original certification
by
the judicial or other governmental authority of the jurisdiction where
such
documents were recorded; and (z) in lieu of the Mortgage Notes relating
to the
Mortgage Loans, each identified in the list delivered by the Purchaser
to the
Trustee on the Closing Date and attached hereto as Exhibit
2,
the
Seller may deliver lost note affidavits and indemnities of the Seller;
and
provided further, however, that in the case of Mortgage Loans which have
been
prepaid in full after the Cut-off Date and prior to the Closing Date, the
Seller, in lieu of delivering the above documents, may deliver to the Trustee
a
certification by the Seller to such effect. The Seller shall deliver such
original documents (including any original documents as to which certified
copies had previously been delivered) or such certified copies to the Trustee
promptly after they are received. The Seller shall cause the Mortgage and
intervening assignments, if any, and the assignment of the Mortgage to
be
recorded not later than 180 days after the Closing Date, or, in lieu of
such
assignments, shall provide an Opinion of Counsel pursuant to Section 6
hereof to
the effect that the recordation of such assignment is not necessary to
protect
the Trustee’s interest in the related Mortgage Loan. Upon the request of the
Purchaser, the Seller will assist the Purchaser in effecting the assignment
referred to above.
(c) In
connection with the assignment of any Mortgage Loan registered on the MERS®
System, the Seller further agrees that it will cause, at the Seller’s own
expense, within thirty (30) days after the Closing Date, the MERS® System to
indicate that such Mortgage Loans have been assigned by the Seller to the
Purchaser and by the Purchaser to the Trustee in accordance with this Agreement
for the benefit of the Certificateholders by including (or deleting, in
the case
of Mortgage Loans which are repurchased in accordance with this Agreement)
in
such computer files (a) the code in the field which identifies the specific
Trustee and (b) the code in the field “Pool Field” which identifies the series
of the Certificates issued in connection with such Mortgage Loans. The
Seller
further agrees that it will not, and will not permit the Servicers to,
alter the
codes referenced in this paragraph with respect to any Mortgage Loan during
the
term of the Pooling and Servicing Agreement unless and until such Mortgage
Loan
is repurchased in accordance with the terms of the Pooling and Servicing
Agreement or the Servicing Agreement, as applicable.
(d) Acceptance
of Mortgage Loans.
The
documents delivered pursuant to Section 4(b) hereof shall be reviewed by
the
Purchaser or any assignee, transferee or designee of the Purchaser at any
time
before or after the Closing Date (and with respect to each document permitted
to
be delivered after the Closing Date, within seven (7) days of its delivery)
to
ascertain that all required documents have been executed and received and
that
such documents relate to the Mortgage Loans identified on the Mortgage
Loan
Schedule.
(e) Transfer
of Interest in Agreements.
The
Purchaser has the right to assign its interest under this Agreement, in
whole or
in part, to the Trustee, as may be required to effect the purposes of the
Pooling and Servicing Agreement, without the consent of the Seller, and
the
assignee shall succeed to the rights and obligations hereunder of the Purchaser.
Any expense reasonably incurred by or on behalf of the Purchaser or the
Trustee
in connection with enforcing any obligations of the Seller under this Agreement
will be promptly reimbursed by the Seller.
SECTION
5. Examination
of Mortgage Files.
(a) On
or
before the Mortgage File Delivery Date, the Seller will have made the Mortgage
Files available to the Purchaser or its agent for examination which may
be at
the offices of the Trustee or the Seller and/or the Seller’s custodian. The fact
that the Purchaser or its agent has conducted or has failed to conduct
any
partial or complete examination of the Mortgage Files shall not affect
the
Purchaser’s rights to demand cure, repurchase, substitution or other relief as
provided in this Agreement. In furtherance of the foregoing, the Seller
shall
make the Mortgage Files available to the Purchaser or its agent from time
to
time so as to permit the Purchaser to confirm the Seller’s compliance with the
delivery and recordation requirements of this Agreement and the Pooling
and
Servicing Agreement. In addition, upon request of the Purchaser, the Seller
agrees to provide to the Purchaser, the Underwriters and to any investors
or
prospective investors in the Certificates information regarding the Mortgage
Loans (which may be at the offices of the Seller and/or the Seller’s custodian)
and to make available personnel knowledgeable about the Mortgage Loans
for
discussions with the Purchaser, the Underwriters and such investors or
prospective investors, upon reasonable request during regular business
hours,
sufficient to permit the Purchaser, the Underwriters and such investors
or
potential investors to conduct such due diligence as any such party reasonably
believes is appropriate.
(b) Pursuant
to the Pooling and Servicing Agreement, on the Closing Date the Custodian
on
behalf of the Trustee, for the benefit of the Certificateholders, will
review
items of the Mortgage Files as set forth on Exhibit
1
and will
deliver to the Seller a certification in the form attached as Exhibit 1
to the
Custodial Agreement.
(c) Pursuant
to the Pooling and Servicing Agreement, the Trustee or the Custodian, on
behalf
of the Trustee, will review the Mortgage Files within 180 days of the Closing
Date and will deliver to the Seller a final certification substantially
in the
form of Exhibit 2 to the Custodial Agreement. If the Custodian is unable
to
deliver a final certification with respect to the items listed in Exhibit
2
due to
any document that is missing, has not been executed or is unrelated, determined
on the basis of the Mortgagor name, original principal balance and loan
number,
to the Mortgage Loans identified in the Final Mortgage Loan Schedule (a
“Material
Defect”),
pursuant to Section 6 of the Custodial Agreement, the Custodian will notify
the
Trustee of such Material Defect and the Trustee shall notify the Seller
of such
Material Defect. The Seller shall correct or cure any such Material Defect
within ninety (90) days from the date of notice from the Trustee of the
Material
Defect and if the Seller does not correct or cure such Material Defect
within
such period and such defect materially and adversely affects the interests
of
the Certificateholders in the related Mortgage Loan, the Seller will, in
accordance with the terms of the Pooling and Servicing Agreement, within
ninety
(90) days of the date of notice, provide the Trustee with a Substitute
Mortgage
Loan (if within two (2) years of the Closing Date) or purchase the related
Mortgage Loan at the applicable Purchase Price; provided,
however,
that if
such defect relates solely to the inability of the Seller to deliver the
original security instrument or intervening assignments thereof or a certified
copy because the originals of such documents or such certified copy have
not
been returned by the applicable jurisdiction, then the Seller shall not
be
required to repurchase such Mortgage Loan if the Seller delivers such original
documents or certified copy promptly upon receipt, but in no event later
than
360 days after the Closing Date. The foregoing repurchase obligation shall
not
apply in the event that the Seller cannot deliver such original or copy
of any
document submitted for recording to the appropriate recording office in
the
applicable jurisdiction because such document has not been returned by
such
office; provided that the Seller shall instead deliver a recording receipt
of
such recording office or, if such receipt is not available, a certificate
of the
Seller or a Servicing Officer confirming that such documents have been
accepted
for recording, and delivery to the Trustee shall be effected by the Seller
within thirty (30) days of its receipt of the original recorded
document.
(d) At
the
time of any substitution, the Seller shall deliver or cause to be delivered
the
Replacement Mortgage Loan, the related Mortgage File and any other documents
and
payments required to be delivered in connection with a substitution pursuant
to
the Pooling and Servicing Agreement. At the time of any purchase or
substitution, the Trustee shall (i) assign to the Seller and cause the
Custodian, on behalf of the Trustee, to release the documents (including,
but
not limited to, the Mortgage, Mortgage Note and other contents of the Mortgage
File) in the possession of the Custodian, on behalf of the Trustee, relating
to
the Deleted Mortgage Loan and (ii) execute and deliver such instruments
of
transfer or assignment, in each case without recourse, as shall be necessary
to
vest in the Seller title to such Deleted Mortgage Loan.
SECTION
6. Recordation
of Assignments of Mortgage.
(a) The
Seller will, promptly after the Closing Date, cause each Mortgage and each
assignment of Mortgage from the Seller to the Trustee, and all unrecorded
intervening assignments, if any, delivered on or prior to the Closing Date,
to
be recorded in all recording offices in the jurisdictions where the related
Mortgaged Properties are located; provided,
however,
the
Seller need not cause to be recorded any assignment for which (a) the related
Mortgaged Property is located in any jurisdiction under the laws of which,
as
evidenced by an Opinion of Counsel delivered by the Seller to the Trustee
and
the Rating Agencies, the recordation of such assignment is not necessary
to
protect the Trustee’s interest in the related Mortgage Loan or (b) MERS is
identified on the Mortgage or on a properly recorded assignment of the
Mortgage
as mortgagee of record solely as nominee for Seller and its successors
and
assigns; provided,
however,
notwithstanding the delivery of any Opinion of Counsel, each assignment
of
Mortgage shall be submitted for recording by the Seller in the manner described
above, at no expense to the Trust Fund or Trustee, upon the earliest to
occur of
(i) reasonable direction by the Holders of Certificates evidencing Percentage
Interests aggregating not less than twenty-five percent (25%) of the Trust,
(ii)
the occurrence of an Event of Default, (iii) the occurrence of a bankruptcy,
insolvency or foreclosure relating to the Seller, (iv) the occurrence of
a
servicing transfer as described in Section 8.02 of the Pooling and Servicing
Agreement or (v) with respect to any assignment of Mortgage, the occurrence
of a
bankruptcy, insolvency or foreclosure relating to the Mortgagor under the
related Mortgage.
(b) While
each such Mortgage or assignment is being recorded, if necessary, the Seller
shall leave or cause to be left with the Custodian, on behalf of the Trustee,
a
certified copy of such Mortgage or assignment. In the event that, within
180
days of the Closing Date, the Trustee has not been provided with an Opinion
of
Counsel as described above or received evidence of recording with respect
to
each Mortgage Loan delivered to the Purchaser pursuant to the terms hereof
or as
set forth above and the related Mortgage Loan is not a MOM Loan, the failure
to
provide evidence of recording or such Opinion of Counsel shall be considered
a
Material Defect, and the provisions of Section 5(c) and (d) shall apply.
All
customary recording fees and reasonable expenses relating to the recordation
of
the assignments of mortgage to the Trustee or the Opinion of Counsel, as
the
case may be, shall be borne by the Seller.
SECTION
7. Representations,
Warranties and Covenants of the Seller.
The
Seller hereby represents and warrants to the Purchaser, as of the date
hereof
and as of the Closing Date, and covenants, that:
(i) The
Seller is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware and is qualified and in good standing
to
do business in each jurisdiction where such qualification is necessary,
except
where the failure to so qualify would not reasonably be expected to have
a
material adverse effect on the Seller’s business as presently conducted or on
the Seller’s ability to enter into this Agreement and to consummate the
transactions contemplated hereby.
(ii) The
Seller has duly authorized the execution, delivery and performance of this
Agreement, has duly executed and delivered this Agreement, and this Agreement,
assuming due authorization, execution and delivery by the Purchaser, constitutes
a legal, valid and binding obligation of the Seller, enforceable against
it in
accordance with its terms except as the enforceability thereof may be limited
by
bankruptcy, insolvency or reorganization or by general principles of
equity.
(iii) The
execution, delivery and performance of this Agreement by the Seller (x)
does not
conflict and will not conflict with, does not breach and will not result
in a
breach of and does not constitute and will not constitute a default (or
an
event, which with notice or lapse of time or both, would constitute a default)
under (A) any terms or provisions of the organizational documents of the
Seller,
(B) any term or provision of any material agreement, contract, instrument
or
indenture, to which the Seller is a party or by which the Seller or any
of its
property is bound, or (C) any law, rule, regulation, order, judgment, writ,
injunction or decree of any court or governmental authority having jurisdiction
over the Seller or any of its property and (y) does not create or impose
and
will not result in the creation or imposition of any lien, charge or encumbrance
which would have a material adverse effect upon the Mortgage Loans or any
documents or instruments evidencing or securing the Mortgage Loans.
(iv) No
consent, approval, authorization or order of, registration or filing with,
or
notice on behalf of the Seller to any governmental authority or court is
required, under federal laws or the laws of the State of New York, for
the
execution, delivery and performance by the Seller of, or compliance by
the
Seller with, this Agreement or the consummation by the Seller of any other
transaction contemplated hereby and by the Pooling and Servicing Agreement;
provided, however, that the Seller makes no representation or warranty
regarding
federal or state securities laws in connection with the sale or distribution
of
the Certificates.
(v) This
Agreement does not contain any untrue statement of material fact or omit
to
state a material fact necessary to make the statements contained herein
not
misleading. The written statements, reports and other documents prepared
and
furnished or to be prepared and furnished by the Seller pursuant to this
Agreement or in connection with the transactions contemplated hereby taken
in
the aggregate do not contain any untrue statement of material fact or omit
to
state a material fact necessary to make the statements contained therein
not
misleading.
(vi) The
Seller is not in violation of, and the execution and delivery of this Agreement
by the Seller and its performance and compliance with the terms of this
Agreement will not constitute a violation with respect to, any order or
decree
of any court or any order or regulation of any federal, state, municipal
or
governmental agency having jurisdiction over the Seller or its assets,
which
violation might have consequences that would materially and adversely affect
the
condition (financial or otherwise) or the operation of the Seller or its
assets
or might have consequences that would materially and adversely affect the
performance of its obligations and duties hereunder.
(vii) The
Seller does not believe, nor does it have any reason or cause to believe,
that
it cannot perform each and every covenant contained in this
Agreement.
(viii) Immediately
prior to the sale of the Mortgage Loans to the Purchaser as herein contemplated,
the Seller was the owner of the related Mortgage and the indebtedness evidenced
by the related Mortgage Note, and, upon the payment to the Seller of the
Purchase Price, in the event that the Seller retains or has retained record
title, the Seller shall retain such record title to each Mortgage, each
related
Mortgage Note and the related Mortgage Files with respect thereto in trust
for
the Purchaser as the owner thereof from and after the date hereof.
(ix) There
are
no actions or proceedings against, or investigations known to it of, the
Seller
before any court, administrative or other tribunal (A) that might prohibit
it
from entering into this Agreement, (B) seeking to prevent the sale of the
Mortgage Loans by the Seller or the consummation of the transactions
contemplated by this Agreement or (C) that might prohibit or materially
and
adversely affect the performance by the Seller of its obligations under,
or
validity or enforceability of, this Agreement.
(x) The
consummation of the transactions contemplated by this Agreement are in
the
ordinary course of business of the Seller, and the transfer, assignment
and
conveyance of the Mortgage Notes and the Mortgages by the Seller pursuant
to
this Agreement are not subject to the bulk transfer or any similar statutory
provisions in effect in any relevant jurisdiction, except any as may have
been
complied with.
(xi) The
Seller has not dealt with any broker, investment banker, agent or other
person,
except for the Purchaser or any of its affiliates, that may be entitled
to any
commission or compensation in connection with the sale of the Mortgage
Loans
(except that an entity that previously financed the Seller’s ownership of the
Mortgage Loans may be entitled to a fee to release its security interest
in the
Mortgage Loans, which fee shall have been paid and which security interest
shall
have been released on or prior to the Closing Date).
(xii) There
is
no litigation currently pending or, to the best of the Seller’s knowledge
without independent investigation, threatened against the Seller that would
reasonably be expected to adversely affect the transfer of the Mortgage
Loans,
the issuance of the Certificates or the execution, delivery, performance
or
enforceability of this Agreement, or that would result in a material adverse
change in the financial condition of the Seller.
(xiii) The Seller
is a HUD approved mortgagee pursuant to Section 203 of the National Housing
Act.
SECTION
8. Representations
and Warranties of the Seller Relating to the Mortgage Loans.
The
Seller hereby represents and warrants to the Purchaser that as to each
Mortgage
Loan as of the Closing Date:
(i) Information
provided to the Rating Agencies, including the loan level detail set forth
on
the Mortgage Loan Schedule, is true and correct according to the Rating
Agency
requirements;
(ii) No
fraud
has taken place on the part of the Mortgagor or any other party involved
in the
origination or servicing of the Mortgage Loan;
(iii) No
Monthly Payment required to be made under any Mortgage Loan is more than
thirty
(30) days delinquent, with the exception of 0.90% of the Mortgage Loans,
by
aggregate principal balance as of the Cut-off Date, which are 30-59 days
delinquent;
(iv) Neither
the Seller nor the related originator of the Mortgage Loan has advanced
any
Monthly Payment required under the terms of the Mortgage Note;
(v) There
are
no delinquent taxes, assessment liens or insurance premiums affecting the
related Mortgaged Property;
(vi) The
terms
of the Mortgage Note and the Mortgage have not been materially impaired,
waived,
altered or modified in any respect, except by written instruments, recorded
in
the applicable public recording office if necessary to maintain the lien
priority of the Mortgage. The substance of any such waiver, alteration
or
modification has been approved by the title insurer, to the extent required
by
the related policy. No Mortgagor has been released, in whole or in part,
except
in connection with an assumption agreement (approved by the title insurer
to the
extent required by the policy);
(vii) The
Mortgaged Property is insured against loss by fire and hazards of extended
coverage (excluding earthquake insurance) in an amount which is at least
equal
to the lesser of (i) the amount necessary to compensate for any damage
or loss
to the improvements which are a part of such property on a replacement
cost
basis or (ii) the outstanding principal balance of the Mortgage Loan. If
the
Mortgaged Property is in an area identified on a flood hazard map or flood
insurance rate map issued by the Federal Emergency Management Agency as
having
special flood hazards (and such flood insurance has been made available),
a
flood insurance policy meeting the requirements of the current guidelines
of the
Federal Insurance Administration is in effect. All such insurance policies
contain a standard mortgagee clause naming the originator of the Mortgage
Loan,
its successors and assigns as mortgagee and the Seller has not engaged
in any
act or omission which would impair the coverage of any such insurance policies.
Except as may be limited by applicable law, the Mortgage obligates the
Mortgagor
thereunder to maintain all such insurance at the Mortgagor’s cost and expense,
and on the Mortgagor’s failure to do so, authorizes the holder of the Mortgage
to maintain such insurance at Mortgagor’s cost and expense and to seek
reimbursement therefor from the Mortgagor;
(viii) Any
and
all requirements of any federal, state or local law including, without
limitation, usury, truth in lending, real estate settlement procedures,
consumer
credit protection, equal credit opportunity, fair housing, predatory, fair
lending or disclosure laws applicable to the origination and servicing
of the
Mortgage Loans have been complied with in all material respects, and the
consummation of the transactions contemplated hereby will not involve the
violation of any such laws;
(ix) The
Mortgage has not been satisfied, cancelled, subordinated (other than with
respect to second lien Mortgage Loans, the subordination to the first lien)
or
rescinded, in whole or in part, and the Mortgaged Property has not been
released
from the lien of the Mortgage, in whole or in part, nor has any instrument
been
executed that would effect any such satisfaction, cancellation, subordination,
rescission or release;
(x) The
Mortgage was recorded or was submitted for recording in accordance with
all
applicable laws and is a valid, existing and enforceable perfected first
or
second lien on the Mortgaged Property including all improvements on the
Mortgaged Property, subject only to (a) the lien of the current real property
taxes and (b) covenants, conditions and restrictions, rights of way and
easements;
(xi) The
Mortgage Note and the related Mortgage are genuine and each is the legal,
valid
and binding obligation of the maker thereof, insured under the related
title
policy, and enforceable in accordance with its terms, except to the extent
that
the enforceability thereof may be limited by a bankruptcy, insolvency or
reorganization;
(xii) The
Seller is the sole legal, beneficial and equitable owner of the Mortgage
Note
and the Mortgage and has the full right to convey, transfer and sell the
Mortgage Loan to the Purchaser free and clear of any encumbrance, equity,
lien,
(other than with respect to second lien Mortgage Loans, the subordination
to the
first lien), pledge, charge, claim or security interest and immediately
upon the
sale, assignment and endorsement of the Mortgage Loans from the Seller
to the
Purchaser, the Purchaser shall have good and indefeasible title to and
be the
sole legal owner of the Mortgage Loans subject only to any encumbrance,
equity,
lien, pledge, charge, claim or security interest arising out of the Purchaser’s
actions;
(xiii) Each
Mortgage Loan is covered by a valid and binding American Land Title Association
lender’s title insurance policy issued by a title insurer qualified to do
business in the jurisdiction where the Mortgaged Property is located, which
title insurance policy is generally acceptable to Xxxxxx Xxx and Xxxxxxx
Mac. No
claims have been filed under such lender’s title insurance policy, and the
Seller has not done, by act or omission, anything that would impair the
coverage
of the lender’s title insurance policy;
(xiv) There
is
no material default, breach, violation event or event of acceleration existing
under the Mortgage or the Mortgage Note and no event which, with the passage
of
time or with notice and the expiration of any grace or cure period, would
constitute a material default, breach, violation or event of acceleration,
and
the Seller has not, nor has its predecessors, waived any material default,
breach, violation or event of acceleration;
(xv) There
are
no mechanics’ or similar liens or claims which have been filed for work, labor
or material provided to the related Mortgaged Property prior to the origination
of the Mortgage Loan which are or may be liens prior to, or equal or coordinate
with, the lien of the related Mortgage, except as may be disclosed in the
related title policy;
(xvi) Except
with respect to approximately 51.05% of the Mortgage Loans by aggregate
principal balance as of the Cut-off Date, which are balloon loans and
approximately 11.98% of the Mortgage Loans by aggregate principal balance
as of
the Cut-off Date, which are interest only loans, each Mortgage Note is
payable
on the first day of each month in equal monthly installments of principal
and
interest (subject to adjustment in the case of the adjustable rate Mortgage
Loans), with interest calculated on a 30/360 basis and payable in arrears,
sufficient to amortize the Mortgage Loan fully by the stated maturity date
over
an original term from commencement of amortization to not more than thirty
(30)
years. No Mortgage Loan permits negative amortization;
(xvii) The
servicing practices used in connection with the servicing of the Mortgage
Loans
have been in all respects reasonable and customary in the mortgage servicing
industry of like mortgage loan servicers, servicing mortgage loans similar
to
the Mortgage Loans in the same jurisdiction as the Mortgaged
Property;
(xviii) To
the
best of the Seller’s knowledge, there is no proceeding pending for the total or
partial condemnation of the Mortgaged Property;
(xix) The
Mortgage and related Mortgage Note contain customary and enforceable provisions
such as to render the rights and remedies of the holder thereof adequate
for the
realization against the Mortgaged Property of the benefits of the security
provided thereby, including, (a) in the case of a Mortgage designated as
a deed
of trust, by trustee’s sale, and (b) otherwise by judicial
foreclosure;
(xx) The
Mortgage Note is not and has not been secured by any collateral except
the lien
of the related Mortgage referred to in subsection (x) above;
(xxi) In
the
event the Mortgage constitutes a deed of trust, a trustee, duly qualified
under
applicable law to serve as such, has been properly designated and currently
so
serves and is named in the Mortgage, and no fees or expenses are or will
become
payable by the Seller to the trustee under the deed of trust, except in
connection with a trustee’s sale after default by the Mortgagor;
(xxii) The
Mortgage Loan is not subject to any valid right of rescission, set-off,
counterclaim or defense, including without limitation the defense of usury,
nor
will the operation of any of the terms of the Mortgage Note or the Mortgage,
or
the exercise of any right thereunder, render either the Mortgage Note or
the
Mortgage unenforceable, in whole or in part, or subject to any such right
of
rescission, set-off, counterclaim or defense, including without limitation
the
defense of usury, and no such right of rescission, set-off, counterclaim
or
defense has been asserted with respect thereto;
(xxiii) The
Mortgaged Property is free of material damage and in good repair, excepting
therefrom any Mortgage Loan subject to an escrow withhold as shown on the
Mortgage Loan Schedule;
(xxiv) All
of
the improvements which were included in determining the appraised value
of the
Mortgaged Property lie wholly within the Mortgaged Property’s boundary lines and
no improvements on adjoining properties encroach upon the Mortgaged Property,
excepting therefrom: (i) any encroachment insured against in the lender’s title
insurance policy identified in clause (xiii) above, (ii) any encroachment
generally acceptable to mortgage loan originators doing business in the
same
jurisdiction as the Mortgaged Property, and (iii) any encroachment which
does
not materially interfere with the benefits of the security intended to
be
provided by such Mortgage;
(xxv) All
parties to the Mortgage Note had the legal capacity to execute the Mortgage
Note
and the Mortgage, and the Mortgage Note and the Mortgage have been duly
executed
by such parties;
(xxvi) To
the
best of the Seller’s knowledge, at the time of origination of the Mortgage Loan,
no appraised improvement located on or being part of the Mortgaged Property
was
in violation of any applicable zoning law or regulation and all inspections,
licenses and certificates required in connection with the origination of
any
Mortgage Loan with respect to the occupancy of the Mortgaged Property,
have been
made or obtained from the appropriate authorities;
(xxvii) No
Mortgagor has notified the Seller of any relief requested or allowed under
the
Servicemembers Civil Relief Act;
(xxviii) All
parties which have held an interest in the Mortgage Loan are (or during
the
period in which they held and disposed of such interest, were) (1) in compliance
with any and all applicable licensing requirements of the state wherein
the
Mortgaged Property is located, (2) organized under the laws of such state,
(3)
qualified to do business in such state, (4) a federal savings and loan
association or national bank, (5) not doing business in such state, or
(6)
exempt from the applicable licensing requirements of such state;
(xxix) The
Mortgage File contains an appraisal of the related Mortgaged Property which
was
made prior to the approval of the Mortgage Loan by a qualified appraiser,
duly
appointed by the related originator and was made in accordance with the
Financial Institutions Reform, Recovery, and Enforcement Act of 1989 and
the
Uniform Standards of Professional Appraisal Practice;
(xxx) Except
as
may otherwise be limited by applicable law, the Mortgage contains an enforceable
provision for the acceleration of the payment of the unpaid principal balance
of
the Mortgage Loan in the event that the Mortgaged Property is sold or
transferred without the prior written consent of the Mortgagee
thereunder;
(xxxi) The
Mortgage Loan does not contain any provision which would constitute a “buydown”
provision and pursuant to which Monthly Payments are paid or partially
paid with
funds deposited in a separate account established by the related originator,
the
Mortgagor or anyone on behalf of the Mortgagor, or paid by any source other
than
the Mortgagor. The Mortgage Loan is not a “graduated payment mortgage loan” and
the Mortgage loan does not have a shared appreciation or other contingent
interest feature;
(xxxii) To
the
best of the Seller’s knowledge there is no action or proceeding directly
involving the Mortgaged Property presently pending in which compliance
with any
environmental law, rule or regulation is at issue and the Seller has received
no
notice of any condition at the Mortgaged Property which is reasonably likely
to
give rise to an action or proceeding in which compliance with any environmental
law, rule or regulation is at issue;
(xxxiii) Each
Mortgage Loan is an obligation which is principally secured by an interest
in
real property within the meaning of Treasury Regulation section 1.860G-2(a);
(xxxiv) Each
Mortgage Loan is directly secured by a first or second lien on, and consists
of
a single parcel of, real property with a detached one-to-four family residence
erected thereon, a townhouse or an individual condominium unit in a condominium
project, or an individual unit in a planned unit development (“PUD”). No
residence or dwelling is a leasehold, mobile home or a manufactured dwelling
unless it is an Acceptable Manufactured Dwelling. An “Acceptable Manufactured
Dwelling” is a manufactured dwelling, which is permanently affixed to a
foundation and treated as “real estate” under applicable law. No Mortgaged
Property is used for commercial purposes. Mortgaged Properties which contain
a
home office shall not be considered as being used for commercial purposes
as
long as the Mortgaged Property has not been altered for commercial purposes
and
is not storing any chemicals or raw materials other than those commonly
used for
homeowner repair, maintenance and/or household purposes;
(xxxv) The
Mortgage Interest Rate payable by the Mortgagor with respect to the Adjustable
Rate Mortgage Loans is subject to adjustment at the time and in the amounts
as
are set forth in the related Mortgage Note;
(xxxvi) Reserved;
(xxxvii) To
the
best of the Seller’s knowledge, the servicer for each Mortgage Loan has
accurately and fully reported its borrower credit files to each of the
credit
repositories in a timely manner;
(xxxviii) No
Mortgage Loan is subject to the Home Ownership and Equity Protection Act
of 1994
(“HOEPA”) or any comparable law and no Mortgage Loan is classified and/or
defined as a “high cost”, “covered”, (excluding home loans defined as “covered
home loans” in the New Jersey Home Ownership Security Act of 2002 that were
originated between November 26, 2003 and July 7, 2004), “high risk home” or
“predatory” loan under any other federal, state or local law or regulation or
ordinance (or a similarly classified loan using different terminology under
a
law imposing heightened regulatory scrutiny or additional legal liability
for
residential mortgage loans having high interest rates, points and/or
fees);
(xxxix) No
Mortgage Loan was selected from the mortgage loans in the Seller’s portfolio in
a manner so as to affect adversely the interests of the Purchaser;
(xl) Each
Mortgage File contains a full appraisal on form 1004 or 2055 with an interior
inspection (or the equivalent form for two-to four-family and investor
properties), or on a similar alternate form which includes substantially
similar
information to that required such forms, as applicable;
(xli) Each
Mortgage Loan is and will be a mortgage loan arising out of the originator’s
practice in accordance with the originator’s underwriting
guidelines;
(xlii) As
of the
Closing Date, the Seller has no knowledge of any fact that should lead
it to
expect that the Mortgage Loan will not be paid in full when due;
(xliii) No
Mortgage Loan is a “high cost loan” or a “covered loan”, as applicable (as such
terms are defined in the then current Standard & Poor’s LEVELS Version 5.7
Glossary Revised, Appendix E;
(xliv) No
Mortgage Loan originated on or after October 1, 2002 through March 6, 2003
is
governed by the Georgia Fair Lending Act;
(xlv) The
information set forth in the applicable part of the Mortgage Loan Schedule
relating to the existence of a Prepayment Charge is complete, true and
correct
in all material respects at the date or dates on which such information
is
furnished respecting with such information is furnished, and each Prepayment
Charge is permissible and enforceable in accordance with its terms upon
the
Mortgagor’s full and voluntary principal prepayment under applicable federal,
state or local law, except to the extent that: (1) the enforceability thereof
may be limited by bankruptcy, insolvency, moratorium, receivership and
other
similar laws relating to creditors’ rights; (2) the collectability thereof may
be limited due to acceleration in connection with a foreclosure or other
involuntary prepayment; or (3) subsequent changes in applicable law may
limit or
prohibit enforceability thereof;
(xlvi) With
respect to each Group I Mortgage Loan, no Mortgagor obtained a prepaid
single-premium credit-life, credit disability, credit unemployment or credit
property insurance policy in connection with the origination of such Group
I
Mortgage Loan;
(xlvii) With
respect to any Group I Mortgage Loan originated on or after August 1, 2004,
neither the related Mortgage nor the related Mortgage Note requires the
Mortgagor to submit to arbitration to resolve any dispute arising out of
or
relating in any way to the Mortgage Loan transaction;
(xlviii) With
respect to the Group I Mortgage Loans, the Mortgagor was not encouraged
or
required to select a mortgage loan product offered by such Mortgage Loan’s
originator which is a higher cost product designed for less creditworthy
borrowers, taking into account such facts as, without limitation, the Mortgage
Loan’s requirements and the Mortgagor’s credit history, income, assets and
liabilities and any such Mortgagor who sought financing through such
originator’s higher-priced lending channel was directed towards or offered the
such originator’s standard mortgage line if such Mortgagor qualified for one of
the standard products;
(xlix) With
respect to the Group I Mortgage Loans, the methodology used in underwriting
the
extension of credit for each Mortgage Loan did not rely solely on the extent
of
the Mortgagor’s equity in the collateral as the principal determining factor in
approving such extension of credit. The methodology employed objective
criteria
such as the Mortgagor’s income, assets and liabilities, to the proposed mortgage
payment and, based on such methodology, the Group I Mortgage Loan’s originator
made a reasonable determination that at the time of origination the Mortgagor
had the ability to make timely payments on such Group I Mortgage
Loan;
(l) With
respect to Group I Mortgage Loans, no Mortgagor was charged “points and fees” in
an amount greater than (a) $1,000 or (b) 5% of the principal amount of
such
Group I Mortgage Loan, whichever is greater. For purposes of this
representation, “points and fees” (x) include origination, underwriting, broker
and finder’s fees and charges that the lender imposed as a condition of making
such Group I Mortgage Loan, whether they are paid to the lender or a third
party; and (y) exclude bona fide discount points, fees paid for actual
services
rendered in connection with the origination of the mortgage (such as attorneys’
fees, notaries fees and fees paid for property appraisals, credit reports,
surveys, title examinations and extracts, flood and tax certifications,
and home
inspections); the cost of mortgage insurance or credit-risk price adjustments;
the costs of title, hazard, and flood insurance policies; state and local
transfer taxes or fees; escrow deposits for the future payment of taxes
and
insurance premiums; and other miscellaneous fees and charges, which
miscellaneous fees and charges, in total, do not exceed 0.25 percent of
the loan
amount;
(li) All
fees
and charges (including finance charges) and whether or not financed, assessed,
collected or to be collected in connection with the origination and servicing
of
each Mortgage Loan has been disclosed in writing to the Mortgagor in accordance
with applicable state and federal law and regulation;
(lii) No
Mortgage Loan contains a provision whereby the Mortgagor can convert an
Adjustable Rate Mortgage Loan into a Fixed Rate Mortgage Loan;
(liii) With
respect to any Mortgage Loan that is secured by a second lien on the related
Mortgaged Property, either (i) no consent for the Mortgage Loan is required
by
the holder of any related senior lien or (ii) such consent has been obtained
and
is contained in the Mortgage File;
(liv) With
respect to a Mortgage Loan which is a second lien, as of the date hereof,
the
Seller has not received a notice of default of a senior lien on the related
Mortgaged Property which has not been cured;
(lv) With
respect to any Group I Mortgage Loan that contains a provision permitting
imposition of a penalty upon a prepayment prior to maturity: (i) the Mortgage
Loan provides some benefit to the Mortgagor (e.g. a rate or fee reduction)
in
exchange for accepting such prepayment penalty, (ii) such Mortgage Loan’s
originator had a written policy of offering the Mortgagor, or requiring
third-party brokers to offer the Mortgagor the option of obtaining a mortgage
loan that did not require payment of such a prepayment penalty, (iii) the
prepayment penalty was adequately disclosed to the Mortgagor pursuant to
applicable state and federal law, (iv) no Group I Mortgage Loan originated
on or
after October 1, 2002 will provide for a prepayment penalty for a term
in excess
of three years and any Group I Mortgage Loan originated prior to such date
will
not provide for prepayment penalties for a term in excess of five years;
in each
case unless such Mortgage Loan was modified to reduce the prepayment period
to
no more than three years from the date of the Mortgage Note and the Mortgagor
was notified in writing of such reduction in prepayment period, and (v)
such
prepayment penalty shall not be imposed in any instance where the mortgage
debt
is accelerated or paid off in connection with the workout of a delinquent
Group
I Mortgage Loan due to the Mortgagor’s default notwithstanding that the terms of
such Group I Mortgage Loan or state or federal law might permit the imposition
of such penalty;
(lvi) The
Servicer for each Group I Mortgage Loan has fully furnished, in accordance
with
the Fair Credit Reporting Act and its implementing regulations, accurate
and
complete information (i.e., favorable and unfavorable) on its borrower
credit
files to Equifax, Experian, and Trans Union Credit Information Company
(three of
the credit repositories), on a monthly basis;
(lvii) With
respect to any Group I Mortgage Loan, the related residential dwelling
is not a
manufactured housing unit;
(lviii) The
original principal balance of each Group I Mortgage Loan which is secured
by a
first lien on the related Mortgaged Property is within Xxxxxxx Mac’s dollar
amount limits for conforming one to four family mortgage loans;
(lix) With
respect to Group I Mortgage Loans, no Mortgage Loan originated on or after
January 1, 2005, which is a “high cost home loan” as defined under the Indiana
Home Loan Practices Act (I.C. 24-9);
(lx) With
respect to a Group I Mortgage Loan which is secured by a second lien, (a)
such
Mortgage Loan is secured by a one- to four-family residence that is the
principal residence of the Mortgagor, (b) the origination amount Mortgage
Loan
did not exceed one-half of the one-unit limitation set forth by Xxxxxxx
Mac for
first lien mortgage loans, and (c) the original principal balance for the
first
lien plus the original principal balance of the second lien Mortgage Loan
do not
exceed Xxxxxxx Mac’s applicable loan limits for first lien mortgage loans for
properties of the same type as the related Mortgaged Property;
(lxi) No
Group
I Mortgage Loan was originated more than one year prior to the Closing
Date;
and
(lxii) No
Group
I Mortgage Loan has an “annual percentage rate” or “total points and fees”
payable by the borrower (as each such term is defined under HOEPA) that
equal or
exceed the applicable thresholds defined under HOEPA (Section 32 of Regulation
Z, 12 C.F.R. Section 226.32(a)(1)(i) and (ii)).
SECTION
9. Repurchase
Obligation for Defective Documentation and for Breach of Representation
and
Warranty.
(a) The
representations and warranties contained in Section 8 shall not be impaired
by
any review and examination of loan files or other documents evidencing
or
relating to the Mortgage Loans or any failure on the part of the Seller
or the
Purchaser to review or examine such documents and shall inure to the benefit
of
any assignee, transferee or designee of the Purchaser, including the Trustee
for
the benefit of the Certificateholders. With respect to the representations
and
warranties contained herein as to which the Seller has no knowledge, if
it is
discovered that the substance of any such representation and warranty was
inaccurate as of the date such representation and warranty was made or
deemed to
be made, and such inaccuracy materially and adversely affects the value
of the
related Mortgage Loan or the interest therein of the Purchaser or the
Purchaser’s assignee, transferee or designee, then notwithstanding the lack of
knowledge by the Seller with respect to the substance of such representation
and
warranty being inaccurate at the time the representation and warranty was
made,
the Seller shall take such action described in the following paragraph
in
respect of such Mortgage Loan. Notwithstanding anything to the contrary
contained herein, any breach of a representation or warranty contained
in
clauses (viii), (xxxviii), (xliii), (xliv), (xlvi), (xlvii), (xlviii),
(xlix),
(l), (lvi), (lvii), (lviii), (lix), (lx), (lxi) and/or (lxii) of Section
8
above, shall be automatically deemed to affect materially and adversely
the
interests of the Purchaser or the Purchaser’s assignee, transferee or designee.
Upon
discovery by the Seller, the Purchaser or any assignee, transferee or designee
of the Purchaser of any materially defective document in, or that any material
document was not transferred by the Seller (as listed on an exception report
attached to the initial certification prepared by the Custodian, on behalf
of
the Trustee), or of a breach of any of the representations and warranties
contained in Section 8 that materially and adversely affects the value
of any
Mortgage Loan or the interest therein of the Purchaser or the Purchaser’s
assignee, transferee or designee, the party discovering such breach shall
give
prompt written notice to the Seller. Within 365 days of its discovery or
its
receipt of notice of any such missing documentation that was not transferred
by
the Seller as described above, or of materially defective documentation,
or
within 120 days of any such breach of a representation and warranty, the
Seller
promptly shall deliver such missing document or cure such defect or breach
in
all material respects or, in the event the Seller cannot deliver such missing
document or cannot cure such defect or breach, the Seller shall, within
365 days
of its discovery or receipt of notice of any such missing or materially
defective documentation or within 120 days of any such breach of a
representation and warranty, either (i) repurchase the affected Mortgage
Loan at
the Purchase Price (as such term is defined in the Pooling and Servicing
Agreement) or (ii) pursuant to the provisions of the Pooling and Servicing
Agreement, cause the removal of such Mortgage Loan from the Trust Fund
and
substitute one or more Replacement Mortgage Loans. The Seller shall amend
the
Closing Schedule to reflect the withdrawal of such Mortgage Loan from the
terms
of this Agreement and the Pooling and Servicing Agreement. The Seller shall
deliver to the Purchaser such amended Closing Schedule and shall deliver
such
other documents as are required by this Agreement or the Pooling and Servicing
Agreement within five (5) days of any such amendment. Any repurchase pursuant
to
this Section 9(a) shall be accomplished by transfer to an account designated
by
the Purchaser of the amount of the Purchase Price in accordance with Section
2.03 of the Pooling and Servicing Agreement. Any repurchase required by
this
Section shall be made in a manner consistent with Section 2.03 of the Pooling
and Servicing Agreement.
(b) If
the
representation made by the Seller in Section 8(xlv) is breached, the Seller
shall not have the right or obligation to cure, substitute or repurchase
the
affected Mortgage Loan but shall remit to the Servicer servicing such Mortgage
Loan for deposit in the Collection Account, prior to the next succeeding
Servicer Remittance Date, the amount of the Prepayment Charge indicated
on the
applicable part of the Mortgage Loan Schedule to be due from the Mortgagor
in
the circumstances less any amount collected and remitted to such Servicer
for
deposit into the Collection Account.
(c) It
is
understood and agreed that the obligations of the Seller set forth in this
Section 9 to cure or repurchase a defective Mortgage Loan (and to make
payments
pursuant to Section 9(b)) constitute the sole remedies of the Purchaser
against
the Seller respecting a missing document or a breach of the representations
and
warranties contained in Section 8.
SECTION
10. Closing;
Payment for the Mortgage Loans.The
closing of the purchase and sale of the Mortgage Loans shall be held at
the New
York City office of Xxxxxxx Xxxxxxxx & Wood llp
at 10:00
a.m. New York City time on the Closing Date.
The
closing shall be subject to each of the following conditions:
(a) All
of
the representations and warranties of the Seller under this Agreement shall
be
true and correct in all material respects as of the date as of which they
are
made and no event shall have occurred which, with notice or the passage
of time,
would constitute a default under this Agreement;
(b) The
Purchaser shall have received, or the attorneys of the Purchaser shall
have
received in escrow (to be released from escrow at the time of closing),
all
Closing Documents as specified in Section 11 of this Agreement, in such
forms as
are agreed upon and acceptable to the Purchaser, duly executed by all
signatories other than the Purchaser as required pursuant to the respective
terms thereof;
(c) The
Seller shall have delivered or caused to be delivered and released to the
Purchaser or to its designee, all documents (including without limitation,
the
Mortgage Loans) required to be so delivered by the Purchaser pursuant to
Section
2.01 of the Pooling and Servicing Agreement; and
(d) All
other
terms and conditions of this Agreement and the Pooling and Servicing Agreement
shall have been complied with.
Subject
to the foregoing conditions, the Purchaser shall deliver or cause to be
delivered to the Seller on the Closing Date, against delivery and release
by the
Seller to the Trustee of all documents required pursuant to the Pooling
and
Servicing Agreement, the consideration for the Mortgage Loans as specified
in
Section 3 of this Agreement.
SECTION
11. Closing
Documents.
Without
limiting the generality of Section 10 hereof, the closing shall be subject
to
delivery of each of the following documents:
(a) An
Officers’ Certificate of the Seller, dated the Closing Date, upon which the
Purchaser and the Underwriters may rely with respect to certain facts regarding
the sale of the Mortgage Loans by the Seller to the Purchaser;
(b) An
Opinion of Counsel of the Seller, dated the Closing Date and addressed
to the
Purchaser and the Underwriters;
(c) Such
opinions of counsel as the Rating Agencies or the Trustee may request in
connection with the sale of the Mortgage Loans by the Seller to the Purchaser
or
the Seller’s execution and delivery of, or performance under, this Agreement;
and
(d) Such
further information, certificates, opinions and documents as the Purchaser
or
the Underwriters may reasonably request.
SECTION
12. Costs.
The
Seller shall pay (or shall reimburse the Purchaser or any other Person
to the
extent that the Purchaser or such other Person shall pay) all costs and
expenses
incurred in connection with the transfer and delivery of the Mortgage Loans,
including without limitation, fees for title policy endorsements and
continuations, the fees and expenses of the Seller’s accountants and attorneys,
the costs and expenses incurred in connection with producing a Servicer’s loan
loss, foreclosure and delinquency experience, and the costs and expenses
incurred in connection with obtaining the documents referred to in Sections
11(b) and 11(c), the costs and expenses of printing (or otherwise reproducing)
and delivering this Agreement, the Pooling and Servicing Agreement, the
Certificates, the prospectus and prospectus supplement, and any private
placement memorandum relating to the Certificates and other related documents,
the initial fees, costs and expenses of the Trustee and its counsel, the
fees
and expenses of the Purchaser’s counsel in connection with the preparation of
all documents relating to the securitization of the Mortgage Loans, the
filing
fee charged by the Securities and Exchange Commission for registration
of the
Certificates and the fees charged by any rating agency to rate the Certificates.
The Seller shall pay all costs and expenses related to recording the Assignments
of Mortgage. All other costs and expenses in connection with the transactions
contemplated hereunder shall be borne by the party incurring such
expense.
SECTION
13. Mandatory
Delivery; Grant of Security Interest.
The
sale and delivery on the Closing Date of the Mortgage Loans described on
the
Mortgage Loan Schedule in accordance with the terms and conditions of this
Agreement is mandatory. It is specifically understood and agreed that each
Mortgage Loan is unique and identifiable on the date hereof and that an
award of
money damages would be insufficient to compensate the Purchaser for the
losses
and damages incurred by the Purchaser in the event of the Seller’s failure to
deliver the Mortgage Loans on or before the Closing Date. The Seller hereby
grants to the Purchaser a lien on and a continuing security interest in
the
Seller’s interest in each Mortgage Loan and each document and instrument
evidencing each such Mortgage Loan to secure the performance by the Seller
of
its obligation hereunder, and the Seller agrees that it holds such Mortgage
Loans in custody for the Purchaser, subject to the Purchaser’s (i) right, prior
to the Closing Date, to reject any Mortgage Loan to the extent permitted
by this
Agreement and (ii) obligation to deliver or cause to be delivered the
consideration for the Mortgage Loans pursuant to Section 3 hereof. Any
Mortgage
Loans rejected by the Purchaser shall concurrently therewith be released
from
the security interest created hereby. All rights and remedies of the Purchaser
under this Agreement are distinct from, and cumulative with, any other
rights or
remedies under this Agreement or afforded by law or equity and all such
rights
and remedies may be exercised concurrently, independently or
successively.
Notwithstanding
the foregoing, if on the Closing Date, each of the conditions set forth
in
Section 10 hereof shall have been satisfied and the Purchaser shall not
have
paid or caused to be paid the Purchase Price, or any such condition shall
not
have been waived or satisfied and the Purchaser determines not to pay or
cause
to be paid the Purchase Price, the Purchaser shall immediately effect the
redelivery of the Mortgage Loans, if delivery to the Purchaser has occurred,
and
the security interest created by this Section 13 shall be deemed to have
been
released.
SECTION
14. Notices.
All
demands, notices and communications hereunder shall be in writing and shall
be
deemed to have been duly given if personally delivered to or mailed by
registered mail, postage prepaid, or transmitted by fax and, receipt of
which is
confirmed by telephone, if to the Purchaser, addressed to the Purchaser
at Two
World Xxxxxxxxx Xxxxxx, Xxxxxxxx X, 00xx
Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, fax: (000) 000-0000, Attention: Legal Department
(NHEL
2007-2), or such other address as may hereafter be furnished to the Seller
in
writing by the Purchaser; and if to the Seller, addressed to the Seller
at Two
World Xxxxxxxxx Xxxxxx, Xxxxxxxx X, 00xx
Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, fax: (000) 000-0000, Attention: Xxxxx Xxxxxx,
or to
such other address as the Seller may designate in writing to the
Purchaser.
SECTION
15. Severability
of Provisions.
Any
part, provision, representation or warranty of this Agreement that is prohibited
or that is held to be void or unenforceable shall be ineffective to the
extent
of such prohibition or unenforceability without invalidating the remaining
provisions hereof. Any part, provision, representation or warranty of this
Agreement that is prohibited or unenforceable or is held to be void or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating
the
remaining provisions hereof, and any such prohibition or unenforceability
in any
jurisdiction as to any Mortgage Loan shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent permitted
by applicable law, the parties hereto waive any provision of law which
prohibits
or renders void or unenforceable any provision hereof.
SECTION
16. Agreement
of Parties.
The
Seller and the Purchaser each agree to execute and deliver such instruments
and
take such actions as either of the others may, from time to time, reasonably
request in order to effectuate the purpose and to carry out the terms of
this
Agreement and the Pooling and Servicing Agreement.
SECTION
17. Survival.
The
Seller agrees that the representations, warranties and agreements made
by it
herein and in any certificate or other instrument delivered pursuant hereto
shall be deemed to be relied upon by the Purchaser, notwithstanding any
investigation heretofore or hereafter made by the Purchaser or on its behalf,
and that the representations, warranties and agreements made by the Seller
herein or in any such certificate or other instrument shall survive the
delivery
of and payment for the Mortgage Loans and shall continue in full force
and
effect, notwithstanding any restrictive or qualified endorsement on the
Mortgage
Notes and notwithstanding subsequent termination of this Agreement, the
Pooling
and Servicing Agreement or the Trust Fund.
SECTION
18. GOVERNING
LAW.
THIS AGREEMENT AND THE RIGHTS, DUTIES, OBLIGATIONS AND RESPONSIBILITIES
OF THE
PARTIES HERETO SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS
(EXCLUDING THE CHOICE OF LAW PROVISIONS) AND DECISIONS OF THE STATE OF
NEW YORK.
THE PARTIES HERETO INTEND THAT THE PROVISIONS OF SECTION 5-1401 OF THE
NEW YORK
GENERAL OBLIGATIONS LAW SHALL GOVERN.
SECTION
19. Miscellaneous.
This
Agreement may be executed in two or more counterparts, each of which when
so
executed and delivered shall be an original, but all of which together
shall
constitute one and the same instrument. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective
successors and assigns. This Agreement supersedes all prior agreements
and
understandings relating to the subject matter hereof. Neither this Agreement
nor
any term hereof may be changed, waived, discharged or terminated orally,
but
only by an instrument in writing signed by the party against whom enforcement
of
the change, waiver, discharge or termination is sought. The headings in
this
Agreement are for purposes of reference only and shall not limit or otherwise
affect the meaning hereof.
It
is the
express intent of the parties hereto that the conveyance of the Mortgage
Loans
by the Seller to the Purchaser as provided in Section 4 hereof be, and
be
construed as, a sale of the Mortgage Loans by the Seller to the Purchaser
and
not as a pledge of the Mortgage Loans by the Seller to the Purchaser to
secure a
debt or other obligation of the Seller. However, in the event that,
notwithstanding the aforementioned intent of the parties, the Mortgage
Loans are
held to be property of the Seller, then (a) it is the express intent of
the
parties that such conveyance be deemed a pledge of the Mortgage Loans by
the
Seller to the Purchaser to secure a debt or other obligation of the Seller
and
(b) (1) this Agreement shall also be deemed to be a security agreement
within
the meaning of Articles 8 and 9 of the New York Uniform Commercial Code;
(2) the
conveyance provided for in Section 4 hereof shall be deemed to be a grant
by the
Seller to the Purchaser of a security interest in all of the Seller’s right,
title and interest in and to the Mortgage Loans and all amounts payable
to the
holders of the Mortgage Loans in accordance with the terms thereof and
all
proceeds of the conversion, voluntary or involuntary, of the foregoing
into
cash, instruments, securities or other property, including without limitation
all amounts, other than investment earnings, from time to time held or
invested
in the Collection Account whether in the form of cash, instruments, securities
or other property; (3) the possession by the Purchaser or its agent of
Mortgage
Notes, the related Mortgages and such other items of property that constitute
instruments, money, negotiable documents or chattel paper shall be deemed
to be
“possession by the secured party” for purposes of perfecting the security
interest pursuant to Section 9-305 of the New York Uniform Commercial Code;
and
(4) notifications to persons holding such property and acknowledgments,
receipts
or confirmations from persons holding such property shall be deemed
notifications to, or acknowledgments, receipts or confirmations from, financial
intermediaries, bailees or agents (as applicable) of the Purchaser for
the
purpose of perfecting such security interest under applicable law. Any
assignment of the interest of the Purchaser pursuant to Section 4(d) hereof
shall also be deemed to be an assignment of any security interest created
hereby. The Seller and the Purchaser shall, to the extent consistent with
this
Agreement, take such actions as may be necessary to ensure that, if this
Agreement were deemed to create a security interest in the Mortgage Loans,
such
security interest would be deemed to be a perfected security interest of
first
priority under applicable law and will be maintained as such throughout
the term
of this Agreement and the Pooling and Servicing Agreement.
[Signature
page to follow]
*
Please
contact Nomura Credit & Capital, Inc. for pricing
information.
IN
WITNESS WHEREOF, the Purchaser and the Seller have caused their names to
be
signed by their respective officers thereunto duly authorized as of the
date
first above written.
| NOMURA CREDIT & CAPITAL, INC. | ||
| |
|
|
| By: | /s/ Xxxxxxx X.X. Xxxxxxx | |
| Name: |
Xxxxxxx X.X. Xxxxxxx |
|
| Title: | Vice President | |
| NOMURA HOME EQUITY LOAN, INC. | ||
| |
|
|
| By: | /s/ Xxxx X. Xxxxxx | |
| Name: |
Xxxx X. Xxxxxx |
|
| Title: | Managing Director | |
EXHIBIT
1
CONTENTS
OF MORTGAGE FILE
With
respect to each Mortgage Loan, the Mortgage File shall include each of
the
following items, which shall be available for inspection by the Purchaser
or its
designee, and which shall be delivered to the Purchaser or its designee
pursuant
to the terms of the Agreement.
(a) the
original Mortgage Note (including all riders thereto) bearing all intervening
endorsements necessary to show a complete chain of endorsements from the
original payee, endorsed in blank, via
original signature,
and, if
previously endorsed, signed in the name of the last endorsee by a duly
qualified
officer of the last endorsee. If
the
Mortgage Loan was acquired by the last endorsee in a merger, the endorsement
must be by “[name of last endorsee], successor by merger to [name of
predecessor]”. If the Mortgage Loan was acquired or originated by the last
endorsee while doing business under another name, the endorsement must
be by
“[name of last endorsee], formerly known as [previous name]”;
(b) the
original Assignment of Mortgage executed in blank;
(c) the
original of any guarantee executed in connection with the Mortgage Note,
if
any;
(d) the
original Mortgage (including all riders thereto) with evidence of recording
thereon and the original recorded power of attorney, if the Mortgage was
executed pursuant to a power of attorney, with evidence of recording thereon,
and in the case of each MOM Loan, the original Mortgage, noting the presence
of
the MIN of the Mortgage Loan and either language indicating that the Mortgage
Loan is a MOM Loan or if the Mortgage Loan was not a MOM Loan at origination,
the original Mortgage and the assignment thereof to MERS®, with evidence of
recording indicated thereon; or, if the original Mortgage with evidence
of
recording thereon has not been returned by the public recording office
where
such Mortgage has been delivered for recordation or such Mortgage has been
lost
or such public recording office retains the original recorded Mortgage,
a
photocopy of such Mortgage, together with (i) in the case of a delay caused
by
the public recording office, an Officer’s Certificate of the title insurer
insuring the Mortgage, the escrow agent, the seller or the Servicer servicing
such Mortgage Loan stating that such Mortgage has been delivered to the
appropriate public recording office for recordation and that the original
recorded Mortgage or a copy of such Mortgage certified by such public recording
office to be a true and complete copy of the original recorded Mortgage
will be
promptly delivered to the Custodian upon receipt thereof by the party delivering
the Officer’s Certificate or by such Servicer; or (ii) in the case of a Mortgage
where a public recording office retains the original recorded Mortgage
or in the
case where a Mortgage is lost after recordation in a public recording office,
a
copy of such Mortgage with the recording information thereon certified
by such
public recording office to be a true and complete copy of the original
recorded
Mortgage;
(e) the
originals of all assumption, modification, consolidation or extension
agreements, with evidence of recording thereon, if any;
(f) the
originals of any intervening assignments of mortgage with evidence of recording
thereon evidencing a complete chain of ownership from the originator of
the
Mortgage Loan to the last assignee, or if any such intervening assignment
of
mortgage has not been returned from the applicable public recording office
or
has been lost or if such public recording office retains the original recorded
intervening assignments of mortgage, a photocopy of such intervening assignment
of mortgage, together with (i) in the case of a delay caused by the public
recording office, an Officer’s Certificate of the title insurer insuring the
Mortgage, the escrow agent, the seller or the Servicer servicing such Mortgage
Loan stating that such intervening assignment of mortgage has been delivered
to
the appropriate public recording office for recordation and that such original
recorded intervening assignment of mortgage or a copy of such intervening
assignment of mortgage certified by the appropriate public recording office
to
be a true and complete copy of the original recorded intervening assignment
of
mortgage will be promptly delivered to the Custodian upon receipt thereof
by the
party delivering the Officer’s Certificate or by such Servicer; or (ii) in the
case of an intervening assignment of mortgage where a public recording
office
retains the original recorded intervening assignment of mortgage or in
the case
where an intervening assignment of mortgage is lost after recordation in
a
public recording office, a copy of such intervening assignment of mortgage
with
recording information thereon certified by such public recording office
to be a
true and complete copy of the original recorded intervening assignment
of
mortgage;
(g) if
the
Mortgage Note, the Mortgage, any Assignment of Mortgage, or any other related
document has been signed by a Person on behalf of the Mortgagor, the original
power of attorney or other instrument that authorized and empowered such
Person
to sign;
(h) the
original lender’s title insurance policy in the form of an ALTA mortgage title
insurance policy
or,
if the
original lender’s title insurance policy has not been issued, the irrevocable
commitment to issue the same; and
(i) the
original of any security agreement, chattel mortgage or equivalent document
executed in connection with the Mortgage, if any.
EXHIBIT
2
FORM
OF LOST NOTE AFFIDAVIT
Loan
#:
Borrower:
LOST
NOTE
AFFIDAVIT
I,
as
_____________________ of ____________________, a _______________ am authorized
to make this Affidavit on behalf of Nomura Credit & Capital, Inc. (the
“Seller”). In connection with the administration of the Mortgage Loans held by
______________________, a _______________ [corporation] as Seller on behalf
of
____________________ (the “Purchaser”), _______________________ (the
“Deponent”), being duly sworn, deposes and says that:
1. The
Seller’s address is: __________________________
__________________________
__________________________
2. The
Seller previously delivered to the Purchaser a signed Initial Certification
with
respect to such Mortgage and/or Assignment of Mortgage;
3. Such
Mortgage Note and/or Assignment of Mortgage was assigned or sold to the
Purchaser by __________________, a _________________ pursuant to the terms
and
provisions of a Mortgage Loan Purchase Agreement dated as of January 31,
2007;
4. Such
Mortgage Note and/or Assignment of Mortgage is not outstanding pursuant
to a
request for release of Documents;
5. Aforesaid
Mortgage Note and/or Assignment of Mortgage (the “Original”) has been
lost;
6. Deponent
has made or caused to be made a diligent search for the Original and has
been
unable to find or recover same;
7. The
Seller was the Seller of the Original at the time of the loss; and
8. Deponent
agrees that, if said Original should ever come into Seller’s possession, custody
or power, Seller will immediately and without consideration surrender the
Original to the Purchaser.
9. Attached
hereto is a true and correct copy of (i) the Note, endorsed in blank by
the
Mortgagee and (ii) the Mortgage or Deed of Trust (strike one) which secures
the
Note, which Mortgage or Deed of Trust is recorded in the county where the
property is located.
10. Deponent
hereby agrees that the Seller (a) shall indemnify and hold harmless the
Purchaser, its successors and assigns, against any loss, liability or damage,
including reasonable attorney’s fees, resulting from the unavailability of any
Notes, including but not limited to any loss, liability or damage arising
from
(i) any false statement contained in this Affidavit, (ii) any claim of
any party
that purchased a mortgage loan evidenced by the Lost Note or any interest
in
such mortgage loan, (iii) any claim of any borrower with respect to the
existence of terms of a mortgage loan evidenced by the Lost Note on the
related
property to the fact that the mortgage loan is not evidenced by an original
note
and (iv) the issuance of a new instrument in lieu thereof (items (i) through
(iv) above hereinafter referred to as the “Losses”) and (b) if required by any
Rating Agency in connection with placing such Lost Note into a Pass-Through
Transfer, shall obtain a surety from an insurer acceptable to the applicable
Rating Agency to cover any Losses with respect to such Lost Note.
11. This
Affidavit is intended to be relied upon by the Purchaser, its successors
and
assigns. Nomura Credit & Capital, Inc., represents and warrants that is has
the authority to perform its obligations under this Affidavit of Lost
Note.
Executed
this _ day of _______, 200_.
By:__________________________
Name:
Title:
On
this
__ day of ______, 200_, before me appeared ______________________ to me
personally known, who being duly sworn did say that he is the
_______________________ of ____________________, a ______________________
and
that said Affidavit of Lost Note was signed and sealed on behalf of such
corporation and said acknowledged this instrument to be the free act and
deed of
said entity.
Signature:
[Seal]
EXHIBIT
D
FORM
OF
TRANSFER AFFIDAVIT AND AGREEMENT
|
STATE
OF NEW YORK
|
)
|
|
|
)
|
ss.:
|
|
|
COUNTY
OF NEW YORK
|
)
|
___________________________
being duly sworn, deposes, represents and warrants as follows:
|
1.
|
I
am a _____________________ of _______________________________ (the
“Investor”) a corporation duly organized and existing under the laws of
_________________________, the record owner of Nomura Home Equity
Loan,
Inc., Home Equity Loan Trust, Series 2007-2 Asset-Backed Certificates,
Class R[-X] Certificates (the “Class R[-X] Certificates”), on behalf of
whom I make this affidavit and agreement. Capitalized terms used
but not
defined herein have the respective meanings assigned thereto in
the
Pooling and Servicing Agreement pursuant to which the Class R[-X]
Certificates were issued.
|
|
2.
|
The
Investor (i) is and will be a “Permitted Transferee” as of
____________________. ____ and (ii) is acquiring the Class R[-X]
Certificates for its own account or for the account of another
Investor
from which it has received an affidavit in substantially the same
form as
this affidavit. A “Permitted Transferee” is any person other than a
“disqualified organization” or a possession of the United States. For this
purpose, a “disqualified organization” means the United States, any state
or political subdivision thereof, any agency or instrumentality
of any of
the foregoing (other than an instrumentality all of the activities
of
which are subject to tax and, except for the Federal Home Loan
Mortgage
Corporation, a majority of whose board of directors is not selected
by any
such governmental entity) or any foreign government, international
organization or any agency or instrumentality of such foreign government
or organization, any real electric or telephone cooperative, or
any
organization (other than certain farmers’ cooperatives) that is generally
exempt from federal income tax unless such organization is subject
to the
tax on unrelated business taxable
income.
|
|
3.
|
The
Investor is aware (i) of the tax that would be imposed on transfers
of the
Class R[-X] Certificates to disqualified organizations under the
Internal
Revenue Code of 1986 that applies to all transfers of the Class
R[-X]
Certificates after July 31, 1988; (ii) that such tax would be on
the
transferor or, if such transfer is through an agent (which person
includes
a broker, nominee or middleman) for a non-Permitted Transferee,
on the
agent; (iii) that the person otherwise liable for the tax shall
be
relieved of liability for the tax if the transferee furnishes to
such
person an affidavit that the transferee is a Permitted Transferee
and, at
the time of transfer, such person does not have actual knowledge
that the
affidavit is false; and (iv) that each of the Class R[-X] Certificates
may
be a “noneconomic residual interest” within the meaning of proposed
Treasury regulations promulgated under the Code and that the transferor
of
a “noneconomic residual interest” will remain liable for any taxes due
with respect to the income on such residual interest, unless no
significant purpose of the transfer is to impede the assessment
or
collection of tax.
|
|
4.
|
The
Investor is aware of the tax imposed on a “pass-through entity” holding
the Class R[-X] Certificates if, at any time during the taxable
year of
the pass-through entity, a non-Permitted Transferee is the record
holder
of an interest in such entity. (For this purpose, a “pass-through entity”
includes a regulated investment company, a real estate investment
trust or
common trust fund, a partnership, trust or estate, and certain
cooperatives.)
|
|
5.
|
The
Investor is aware that the Securities Administrator will not register
the
transfer of any Class R[-X] Certificate unless the transferee,
or the
transferee’s agent, delivers to the Securities Administrator, among other
things, an affidavit in substantially the same form as this affidavit.
The
Investor expressly agrees that it will not consummate any such
transfer if
it knows or believes that any of the representations contained
in such
affidavit and agreement are false.
|
|
6.
|
The
Investor consents to any additional restrictions or arrangements
that
shall be deemed necessary upon advice of counsel to constitute
a
reasonable arrangement to ensure that the Class R[-X] Certificates
will
only be owned, directly or indirectly, by an Investor that is a
Permitted
Transferee.
|
|
7.
|
The
Investor’s taxpayer identification number is
________________.
|
|
8.
|
The
Investor has reviewed the restrictions set forth on the face of
the Class
R[-X] Certificates and the provisions of Section 6.02(d) of the
Pooling
and Servicing Agreement under which the Class R[-X] Certificates
were
issued (in particular, clauses (iii)(A) and (iii)(B) of Section
6.02(d)
which authorize the Securities Administrator to deliver payments
to a
person other than the Investor and negotiate a mandatory sale by
the
Securities Administrator in the event that the Investor holds such
Certificate in violation of Section 6.02(d)); and that the Investor
expressly agrees to be bound by and to comply with such restrictions
and
provisions.
|
|
9.
|
The
Investor is not acquiring and will not transfer the Class R[-X]
Certificates in order to impede the assessment or collection of
any
tax.
|
|
10.
|
The
Investor anticipates that it will, so long as it holds the Class
R[-X]
Certificates, have sufficient assets to pay any taxes owed by the
holder
of such Class R[-X] Certificates, and hereby represents to and
for the
benefit of the person from whom it acquired the Class R[-X] Certificates
that the Investor intends to pay taxes associated with holding
such Class
R[-X] Certificates as they become due, fully understanding that
it may
incur tax liabilities in excess of any cash flows generated by
the Class
R[-X] Certificates.
|
|
11.
|
The
Investor has no present knowledge that it may become insolvent
or subject
to a bankruptcy proceeding for so long as it holds the Class R[-X]
Certificates.
|
|
12.
|
The
Investor has no present knowledge or expectation that it will be
unable to
pay any United States taxes owed by it so long as any of the Certificates
remain outstanding.
|
|
13.
|
The
Investor is not acquiring the Class R[-X] Certificates with the
intent to
transfer the Class R[-X] Certificates to any person or entity that
will
not have sufficient assets to pay any taxes owed by the holder
of such
Class R[-X] Certificates, or that may become insolvent or subject
to a
bankruptcy proceeding, for so long as the Class R[-X] Certificates
remain
outstanding.
|
|
14.
|
The
Investor will, in connection with any transfer that it makes of
the Class
R[-X] Certificates, obtain from its transferee the representations
required by Section 6.02(d) of the Pooling and Servicing Agreement
under
which the Class R[-X] Certificate were issued and will not consummate
any
such transfer if it knows, or knows facts that should lead it to
believe,
that any such representations are
false.
|
|
15.
|
The
Investor will, in connection with any transfer that it makes of
the Class
R[-X] Certificates, deliver to the Securities Administrator an
affidavit,
which represents and warrants that it is not transferring the Class
R[-X]
Certificates to impede the assessment or collection of any tax
and that it
has no actual knowledge that the proposed transferee: (i) has insufficient
assets to pay any taxes owed by such transferee as holder of the
Class
R[-X] Certificates; (ii) may become insolvent or subject to a bankruptcy
proceeding for so long as the Class R[-X] Certificates remains
outstanding; and (iii) is not a “Permitted
Transferee”.
|
|
16.
|
The
Investor is 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
or
trust whose income from sources without the United States may be
included
in gross income for United States federal income tax purposes regardless
of its connection with the conduct of a trade or business within
the
United States.
|
|
17.
|
The
Investor of the Class R[-X] Certificate, hereby agrees that in
the event
that the Trust Fund created by the Pooling and Servicing Agreement
is
terminated pursuant to Section 10.01 thereof, the undersigned shall
assign
and transfer to the Holders of the Class X and the Class P Certificates
any amounts in excess of par received in connection with such termination.
Accordingly, in the event of such termination, the Securities
Administrator is hereby authorized to withhold any such amounts
in excess
of par and to pay such amounts directly to the Holders of the Class
X and
the Class P Certificates. This agreement shall bind and be enforceable
against any successor, transferee or assigned of the undersigned
in the
Class R[-X] Certificate. In connection with any transfer of the
Class
R[-X] Certificate, the Investor shall obtain an agreement substantially
similar to this clause from any subsequent
owner.
|
IN
WITNESS WHEREOF, the Investor has caused this instrument to be executed on
its
behalf, pursuant to the authority of its Board of Directors, by its [Vice]
President, attested by its [Assistant] Secretary, this ____ day of
_________________, ____.
|
[INVESTOR]
|
||||||||
|
By:
|
||||||||
|
Name:
|
||||||||
|
Title:
[Vice] President
|
||||||||
ATTEST:
|
By:
|
||
|
Name:
|
||
|
Title:
[Assistant] Secretary
|
Personally
appeared before me the above-named __________________, known or proved to
me to
be the same person who executed the foregoing instrument and to be a [Vice]
President of the Investor, 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
Investor.
Subscribed
and sworn before me this ______________ day of __________, ____.
|
Notary
Public
|
|
|
County
of _____________________________
|
|
|
State
of _______________________________
|
|
|
My
Commission expires:
|
FORM
OF
TRANSFEROR AFFIDAVIT
|
STATE
OF NEW YORK
|
)
|
|
|
)
|
ss.:
|
|
|
COUNTY
OF NEW YORK
|
)
|
_________________________,
being duly sworn, deposes, represents and warrants as follows:
1.
I
am
a ____________________
of _________________________ (the “Investor”), a corporation duly organized and
existing under the laws of _____________, on behalf of whom I make this
affidavit.
2. The
Investor is not transferring the Class R[-X] Certificates (the “Residual
Certificates”) to impede the assessment or collection of any tax.
3. The
Investor has no actual knowledge that the Person that is the proposed transferee
(the “Purchaser”) of the Residual Certificates: (i) has insufficient assets to
pay any taxes owed by such proposed transferee as holder of the Residual
Certificates; (ii) may become insolvent or subject to a bankruptcy proceeding
for so long as the Residual Certificates remain outstanding and (iii) is
not a
Permitted Transferee.
4. The
Investor understands that the Purchaser has delivered to the Securities
Administrator a transfer affidavit and agreement in the form attached to
the
Pooling and Servicing Agreement as Exhibit D. The Investor does not know
or
believe that any representation contained therein is false.
5. At
the
time of transfer, the Investor has conducted a reasonable investigation of
the
financial condition of the Purchaser as contemplated by Treasury Regulations
Section 1.860E-1(c)(4)(i) and, as a result of that investigation, the Investor
has determined that the Purchaser has historically paid its debts as they
became
due and has found no significant evidence to indicate that the Purchaser
will
not continue to pay its debts as they become due in the future. The Investor
understands that the transfer of a Residual Certificate may not be respected
for
United States income tax purposes (and the Investor may continue to be liable
for United States income taxes associated therewith) unless the Investor
has
conducted such an investigation.
6. Capitalized
terms not otherwise defined herein shall have the meanings ascribed to them
in
the Pooling and Servicing Agreement dated as of January 1, 2007, among Nomura
Home Equity Loan, Inc., Nomura Credit & Capital, Inc., Ocwen Loan Servicing,
LLC, Equity One, Inc., Select Portfolio Servicing, Inc., Xxxxx Fargo Bank,
N.A.
and HSBC Bank USA, National Association.
IN
WITNESS WHEREOF, the Investor has caused this instrument to be executed on
its
behalf, pursuant to the authority of its Board of Directors, by its [Vice]
President, attested by its [Assistant] Secretary, this ____ day of
________________, ____.
|
[INVESTOR]
|
||||||||
|
By:
|
||||||||
|
Name:
|
||||||||
|
Title:
[Vice] President
|
||||||||
ATTEST:
|
By:
|
||
|
Name:
|
||
|
Title:
[Assistant] Secretary
|
Personally
appeared before me the above-named _________________, known or proved to
me to
be the same person who executed the foregoing instrument and to be a [Vice]
President of the Investor, 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
Investor.
Subscribed
and sworn before me this ______ day of _____________, ____.
|
Notary
Public
|
|
|
County
of _____________________________
|
|
|
State
of _______________________________
|
|
|
My
Commission expires:
|
EXHIBIT
E
FORM
OF
TRANSFEROR CERTIFICATE
______________,
2007
Nomura
Home Equity Loan, Inc.
2
World
Xxxxxxxxx Xxxxxx, Xxxxxxxx X
Xxx
Xxxx,
Xxx Xxxx 00000
Xxxxx
Fargo Bank, N.A.
Xxxxx
Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx,
Xxxxxxxxx 00000
|
Re:
|
Nomura
Home Equity Loan, Inc.
Asset-Backed
Certificates, Series 2007-2, Class [B-1]
[X][P][R][R-X]
|
Ladies
and Gentlemen:
In
connection with the sale by ___________ (the “Sponsor”) to ________ (the
“Purchaser”) of $_________ Initial Certificate Principal Balance of Asset-Backed
Certificates, Series 2007-2, Class _____ (the “Certificates”), issued pursuant
to the Pooling and Servicing Agreement (the “Pooling and Servicing Agreement”),
dated as of January 1, 2007, among Nomura Home Equity Loan, Inc., as depositor
(the “Depositor”), Nomura Credit & Capital, Inc., as sponsor, Ocwen
Loan Servicing, LLC, as a servicer, Equity One, Inc., as a servicer, Select
Portfolio Servicing, LLC, as a servicer, Xxxxx
Fargo Bank, N.A., as master servicer (the “Master Servicer”) and securities
administrator (the “Securities Administrator”) and HSBC Bank USA, National
Association, as trustee (the “Trustee”). The Sponsor hereby certifies,
represents and warrants to, a covenants with, the Depositor, the Securities
Administrator and the Trustee that:
Neither
the Sponsor nor anyone acting on its behalf has (a) offered, pledged, sold,
disposed of or otherwise transferred any Certificate, any interest in any
Certificate or any other similar security to any person in any manner, (b)
has
solicited any offer to buy or to accept a pledge, disposition or other transfer
of any Certificate, any interest in any Certificate or any other similar
security from any person in any manner, (c) has otherwise approached or
negotiated with respect to any Certificate, any interest in any Certificate
or
any other similar security with any person in any manner, (d) has made any
general solicitation by means of general advertising or in any other manner,
or
(e) has taken any other action, that (as to any of (a) through (e) above)
would
constitute a distribution of the Certificates under the Securities Act of
1933
(the “Act”), that would render the disposition of any Certificate a violation of
Section 5 of the Act or any state securities law, or that would require
registration or qualification pursuant thereto. The Sponsor will not act
in any
manner set forth in the foregoing sentence with respect to any Certificate.
The
Sponsor has not and will not sell or otherwise transfer any of the Certificates,
except in compliance with the provisions of the Pooling and Servicing
Agreement.
|
Very
truly yours,
|
||||||||
|
(Sponsor)
|
||||||||
|
By:
|
||||||||
|
Name:
|
||||||||
|
Title:
|
||||||||
EXHIBIT
F
FORM
OF
INVESTOR REPRESENTATION LETTER (NON-RULE 144A)
___________,
2006
Nomura
Home Equity Loan, Inc.
0
Xxxxx
Xxxxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Xxxxx
Fargo Bank, N.A.
Xxxxx
Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx,
Xxxxxxxxx 00000
|
Re:
|
Nomura
Home Equity Loan, Inc., Home Equity Loan Trust, Asset-Backed Certificates,
Series 2007-2
|
Ladies
and Gentlemen:
_______________
(the “Purchaser”) intends to purchase from ____________ (the “Sponsor”)
$_________ Initial Certificate Principal Balance of Asset-Backed Certificates,
Series 2007-2, Class [B-1][X][P][R][R-X] (the “Certificates”), issued pursuant
to the Pooling and Servicing Agreement (the “Pooling and Servicing Agreement”),
dated as of January 1, 2007, among Nomura Home Equity Loan, Inc., as depositor
(the “Depositor”), Nomura Credit & Capital, Inc., as sponsor, Ocwen Loan
Servicing, LLC, as a servicer, Equity One, Inc., as a servicer, Select Portfolio
Servicing, LLC, as a servicer, Xxxxx Fargo Bank, N.A., as master servicer
(the
“Master Servicer”) and securities administrator (the “Securities Administrator”)
and HSBC Bank USA, National Association, as trustee (the “Trustee”). All terms
used herein and not otherwise defined shall have the meanings set forth in
the
Pooling and Servicing Agreement. The Purchaser hereby certifies, represents
and
warrants to, and covenants with, the Depositor, the Securities Administrator
and
the Trustee that:
|
1.
|
The
Purchaser understands that (a) the Certificates have not been and
will not
be registered or qualified under the Securities Act of 1933, as
amended
(the “Act”) or any state securities law, (b) the Depositor is not required
to so register or qualify the Certificates, (c) the Certificates
may be
resold only if registered and qualified pursuant to the provisions
of the
Act or any state securities law, or if an exemption from such registration
and qualification is available, (d) the Pooling and Servicing Agreement
contains restrictions regarding the transfer of the Certificates
and (e)
the Certificates will bear a legend to the foregoing
effect.
|
|
|
2.
|
The
Purchaser is acquiring the Certificates for its own account for
investment
only and not with a view to or for sale in connection with any
distribution thereof in any manner that would violate the Act or
any
applicable state securities laws.
|
|
|
3.
|
The
Purchaser is (a) a substantial, sophisticated institutional investor
having such knowledge and experience in financial and business
matters,
and, in particular, in such matters related to securities similar
to the
Certificates, such that it is capable of evaluating the merits
and risks
of investment in the Certificates, (b) able to bear the economic
risks of
such an investment and (c) an “accredited investor” within the meaning of
Rule 501 (a) promulgated pursuant to the Act.
|
|
|
4.
|
The
Purchaser has been furnished with, and has had an opportunity to
review
(a) a copy of the Pooling and Servicing Agreement and (b) such
other
information concerning the Certificates, the Mortgage Loans and
the
Depositor as has been requested by the Purchaser from the Depositor
or the
Sponsor and is relevant to the Purchaser’s decision to purchase the
Certificates. The Purchaser has had any questions arising from
such review
answered by the Depositor or the Sponsor to the satisfaction of
the
Purchaser.
|
|
|
5.
|
The
Purchaser has not and will not nor has it authorized or will it
authorize
any person to (a) offer, pledge, sell, dispose of or otherwise
transfer
any Certificate, any interest in any Certificate or any other similar
security to any person in any manner, (b) solicit any offer to
buy or to
accept a pledge, disposition of other transfer of any Certificate,
any
interest in any Certificate or any other similar security from
any person
in any manner, (c) otherwise approach or negotiate with respect
to any
Certificate, any interest in any Certificate or any other similar
security
with any person in any manner, (d) make any general solicitation
by means
of general advertising or in any other manner or (e) take any other
action, that (as to any of (a) through (e) above) would constitute
a
distribution of any Certificate under the Act, that would render
the
disposition of any Certificate a violation of Section 5 of the
Act or any
state securities law, or that would require registration or qualification
pursuant thereto. The Purchaser will not sell or otherwise transfer
any of
the Certificates, except in compliance with the provisions of the
Pooling
and Servicing Agreement.
|
|
Very
truly yours,
|
||||||||
|
|
||||||||
|
(Purchaser)
|
||||||||
|
By:
|
||||||||
|
Name:
|
||||||||
|
Title:
|
||||||||
EXHIBIT
G
FORM
OF
RULE 144A INVESTMENT LETTER
[Date]
Nomura
Credit & Capital, Inc.
2
World
Xxxxxxxxx Xxxxxx, Xxxxxxxx X
Xxx
Xxxx,
Xxx Xxxx 00000
Nomura
Home Equity Loan, Inc.
0
Xxxxx
Xxxxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Xxxxx
Fargo Bank, N.A.
Xxxxx
Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx,
Xxxxxxxxx 00000
|
Re:
|
Nomura
Home Equity Loan, Inc., Home Equity Loan Trust, Asset-Backed Certificates,
Series 2007-2 (the “Certificates”), including the Class
[B-1][X][P][R][R-X] Certificates (the “Private
Certificates”)
|
Dear
Ladies and Gentlemen:
In
connection with our purchase of Private Certificates, we confirm
that:
|
(i)
|
we
understand that the Private Certificates are not being registered
under
the Securities Act of 1933, as amended (the “Act”) or any applicable state
securities or “Blue Sky” laws, and are being sold to us in a transaction
that is exempt from the registration requirements of such
laws;
|
|
|
(ii)
|
any
information we desired concerning the Certificates, including the
Private
Certificates, the trust in which the Certificates represent the
entire
beneficial ownership interest (the “Trust”) or any other matter we deemed
relevant to our decision to purchase Private Certificates has been
made
available to us;
|
|
|
(iii)
|
we
are able to bear the economic risk of investment in Private Certificates;
we are an institutional “accredited investor” as defined in Section 501(a)
of Regulation D promulgated under the Act and a sophisticated
institutional investor and we agree to obtain a representation
from any
transferee that such transferee is an institutional “accredited investor”
so long as we are required to obtain a representation letter regarding
compliance with the Act;
|
|
|
(iv)
|
we
are acquiring Private Certificates for our own account, not as
nominee for
any other person, and not with a present view to any distribution
or other
disposition of the Private Certificates;
|
|
|
(v)
|
we
agree the Private Certificates must be held indefinitely by us
(and may
not be sold, pledged, hypothecated or in any way disposed of) unless
subsequently registered under the Act and any applicable state
securities
or “Blue Sky” laws or an exemption from the registration requirements of
the Act and any applicable state securities or “Blue Sky” laws is
available;
|
|
|
(vi)
|
we
agree that in the event that at some future time we wish to dispose
of or
exchange any of the Private Certificates (such disposition or exchange
not
being currently foreseen or contemplated), we will not transfer
or
exchange any of the Private Certificates unless:
|
|
|
(A)
(1) the sale is to an Eligible Purchaser (as defined below), (2)
if
required by the Pooling and Servicing Agreement (as defined below)
a
letter to substantially the same effect as either this letter or,
if the
Eligible Purchaser is a Qualified Institutional Buyer as defined
under
Rule 144A of the Act, the Rule 144A and Related Matters Certificate
in the
form attached to the Pooling and Servicing Agreement (as defined
below)
(or such other documentation as may be acceptable to the Securities
Administrator) is executed promptly by the purchaser and delivered
to the
addressees hereof and (3) all offers or solicitations in connection
with
the sale, whether directly or through any agent acting on our behalf,
are
limited only to Eligible Purchasers and are not made by means of
any form
of general solicitation or general advertising whatsoever;
and
|
||
|
(B) if
the Private Certificate is not registered under the Act (as to
which we
acknowledge you have no obligation), the Private Certificate is
sold in a
transaction that does not require registration under the Act and
any
applicable state securities or “Blue Sky” laws and, if the Securities
Administrator or HSBC Bank USA, National Association, as trustee
(the
“Trustee”) so requests, a satisfactory Opinion of Counsel is furnished to
such effect, which Opinion of Counsel shall be an expense of the
transferor or the transferee;
|
||
|
(vii)
|
we
agree to be bound by all of the terms (including those relating
to
restrictions on transfer) of the Pooling and Servicing Agreement,
pursuant
to which the Trust was formed; we have reviewed carefully and understand
the terms of the Pooling and Servicing Agreement;
|
|
|
(viii)
|
we
either: (i) are not acquiring the Private Certificate directly
or
indirectly by, or on behalf of, an employee benefit plan or other
retirement arrangement which is subject to Title I of the Employee
Retirement Income Security Act of 1974, as amended, and/or section
4975 of
the Internal Revenue Code of 1986, as amended, or (ii) in the case
of a
Class B Certificate, are making or are deemed to make the representations
set forth in Section 6.02(b) of the Agreement, or (iii) in the
case of a
Class X, Class P, Class R or Class R-X Certificate, are providing
the
opinion of counsel specified in Section 6.02(b) of the
Agreement.
|
|
|
(ix)
|
we
understand that each of the Class [X][P][R][R-X] Certificates bears,
and
will continue to bear, legends substantially to the following effect:
“THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY
STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE,
AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED
OR
OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT
AND OTHER
APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES
ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A
“QIB”),
PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT
OF A
QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER,
RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A,
(2)
PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144
UNDER THE
SECURITIES ACT (IF AVAILABLE) OR (3) IN CERTIFICATED FORM TO AN
“INSTITUTIONAL ACCREDITED INVESTOR” WITHIN THE MEANING THEREOF IN RULE
501(a)(1), (2), (3) or (7) OF REGULATION D UNDER THE ACT OR ANY
ENTITY IN
WHICH ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS PURCHASING
NOT
FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO
(A) THE
RECEIPT BY THE SECURITIES ADMINISTRATOR OF A LETTER SUBSTANTIALLY
IN THE
FORM PROVIDED IN THE AGREEMENT AND (B) THE RECEIPT BY THE SECURITIES
ADMINISTRATOR OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE SECURITIES
ADMINISTRATOR THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS
IN
COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR
IN EACH
CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED
STATES AND ANY OTHER APPLICABLE JURISDICTION.
|
|
|
[FOR
CLASS B-1 CERTIFICATES] ANY TRANSFEREE OF THIS CERTIFICATE SHALL
MAKE OR
BE DEEMED TO MAKE THE REPRESENTATIONS SET FORTH IN SECTION 6.02(b)
OF THE
AGREEMENT.
|
||
|
[FOR
CLASS X, CLASS P, Class R AND CLASS R-X CERTIFICATES] NO TRANSFER
OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE TRANSFEREE
PROVIDES A CERTIFICATION PURSUANT TO SECTION 6.02(b) OF THE AGREEMENT
|
“Eligible
Purchaser”
means
a
corporation, partnership or other entity which we have reasonable grounds
to
believe and do believe (i) can make representations with respect to itself
to
substantially the same effect as the representations set forth herein, and
(ii)
is either a Qualified Institutional Buyer as defined under Rule 144A of the
Act
or an institutional “Accredited Investor” as defined under Rule 501 of the
Act.
Terms
not
otherwise defined herein shall have the meanings assigned to them in the
Pooling
and Servicing Agreement, dated as of January 1, 2007, among Nomura Home Equity
Loan, Inc., as depositor, Nomura Credit & Capital, Inc., as sponsor, Ocwen
Loan Servicing, LLC, as a servicer, Equity One, Inc., as a servicer, Select
Portfolio Servicing, LLC, as a servicer, Xxxxx Fargo Bank, N.A., as master
servicer (the “Master Servicer”) and securities administrator (the “Securities
Administrator”) and HSBC Bank USA, National Association, as trustee (the
“Trustee”) (the “Pooling and Servicing Agreement’).
If
the
Purchaser proposes that its Certificates be registered in the name of a nominee
on its behalf, the Purchaser has identified such nominee below, and has caused
such nominee to complete the Nominee Acknowledgment at the end of this
letter.
Name
of
Nominee (if any): _______________________________
IN
WITNESS WHEREOF, this document has been executed by the undersigned who is
duly
authorized to do so on behalf of the undersigned Eligible Purchaser on the
___
day of ________, 20___.
|
Very
truly yours,
|
||||||||
|
[PURCHASER]
|
||||||||
|
By:
|
||||||||
|
(Authorized
Officer)
|
||||||||
|
[By:
|
|
|||||||
|
Attorney-in-fact]
|
||||||||
Nominee
Acknowledgment
The
undersigned hereby acknowledges and agrees that as to the Certificates being
registered in its name, the sole beneficial owner thereof is and shall be
the
Purchaser identified above, for whom the undersigned is acting as
nominee.
|
[NAME
OF NOMINEE]
|
||||||||
|
By:
|
||||||||
|
(Authorized
Officer)
|
||||||||
|
[By:
|
|
|||||||
|
Attorney-in-fact]
|
||||||||
EXHIBIT
H
FORM
OF
ADDITIONAL DISCLOSURE NOTIFICATION
Xxxxx
Fargo Bank, N.A. as Trustee
Xxx
Xxxxxxxxx Xxxx
Xxxxxxxx,
Xxxxxxxx 00000
Fax:
(000) 000-0000
E-mail:
xxx.xxx.xxxxxxxxxxxxx@xxxxxxxxxx.xxx
Nomura
Home Equity Loan, Inc.
2
World
Xxxxxxxxx Xxxxxx, Xxxxxxxx X
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Corporate
Trust Services - Nomura Home Equity Loan, Inc., Home Equity Loan Trust,
Asset-Backed
Certificates, Series 2007-2 - SEC REPORT PROCESSING
RE:
**Additional Form [10-K][10-D][8-K] Disclosure**Required
Ladies
and Gentlemen:
In
accordance with Section [ ] of the Pooling and Servicing Agreement, dated
as of
January 1, 2007, among the Purchaser as depositor, Nomura
Credit & Capital, Inc. as sponsor, Ocwen
Loan Servicing, LLC, as a servicer, Equity One, Inc., as a servicer, Select
Portfolio Servicing, LLC, as a servicer, Xxxxx Fargo Bank, National Association,
as Master Servicer and Securities Administrator, the Undersigned, as [ ],
hereby
notifies you that certain events have come to our attention that [will][may]
need to be disclosed on Form [10-K][10-D][8-K].
Description
of Additional Form [10-K][10-D][8-K]Disclosure:
List
of
Any Attachments hereto to be included in the Additional Form [10-K][10-D][8-K]
Disclosure:
Any
inquiries related to this notification should be directed to [ ], phone number:
[ ]; email address: [ ].
[NAME
OF
PARTY]
as
[role]
By:
________________________________________________
Name:
Title:
EXHIBIT
I
DTC
LETTER OF REPRESENTATIONS
[TO
BE
PROVIDED UPON REQUEST]
EXHIBIT
J
SCHEDULE
OF MORTGAGE LOANS WITH LOST NOTES
[TO
BE
PROVIDED UPON REQUEST]
EXHIBIT
K
PREPAYMENT
CHARGE SCHEDULE
[TO
BE
PROVIDED UPON REQUEST]
EXHIBIT
L
RELEVANT
SERVICING CRITERIA
SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
Assessments
of Compliance and Attestation Reports Servicing Criteria1
|
Reg.
AB Item 1122(d) Servicing Criteria
|
Depositor
|
Seller
|
Servicers2
|
Trustee
|
Custodian
|
Xxxxx
Fargo3
|
|
(1)
General
Servicing Considerations
|
||||||
|
(i) monitoring
performance or other triggers and events of default
|
X
|
X
|
||||
|
(ii) monitoring
performance of vendors of activities outsourced
|
X
|
X
|
||||
|
(iii) maintenance
of back-up servicer for pool assets
|
||||||
|
(iv) fidelity
bond and E&O policies in effect
|
X
|
X
|
||||
|
(2) Cash
Collection and Administration
|
||||||
|
(i) timing
of deposits to custodial account
|
X
|
X
|
||||
|
(ii) wire
transfers to investors by authorized personnel
|
X
|
X
|
||||
|
(iii) advances
or guarantees made, reviewed and approved as required
|
X
|
X
|
||||
|
(iv) accounts
maintained as required
|
X
|
X
|
||||
|
(v) accounts
at federally insured depository institutions
|
X
|
X
|
||||
|
(vi) unissued
checks safeguarded
|
X
|
|||||
|
(vii) monthly
reconciliations of accounts
|
X
|
X
|
||||
|
(3)
Investor
Remittances and Reporting
|
||||||
|
(i) investor
reports
|
X
|
X
|
||||
|
(ii) remittances
|
X
|
X
|
||||
|
(iii) proper
posting of distributions
|
X
|
X
|
||||
|
(iv) reconciliation
of remittances and payment statements
|
X
|
X
|
||||
|
(4)
Pool
Asset Administration
|
||||||
|
(i) maintenance
of pool collateral
|
X
|
X
|
||||
|
(ii) safeguarding
of pool assets/documents
|
X
|
X
|
||||
|
(iii) additions,
removals and substitutions of pool assets
|
X
|
|||||
|
(iv) posting
and allocation of pool asset payments to pool assets
|
X
|
|||||
|
(v) reconciliation
of servicer records
|
X
|
|||||
|
(vi) modifications
or other changes to terms of pool assets
|
X
|
|||||
|
(vii) loss
mitigation and recovery actions
|
X
|
|||||
|
(viii)records
regarding collection efforts
|
X
|
|||||
|
(ix) adjustments
to variable interest rates on pool assets
|
X
|
|||||
|
(x) matters
relating to funds held in trust for obligors
|
X
|
|||||
|
(xi) payments
made on behalf of obligors (such as for taxes or
insurance)
|
X
|
|||||
|
(xii) late
payment penalties with respect to payments made on behalf of obligors
|
X
|
|||||
|
(xiii)records
with respect to payments made on behalf of obligors
|
X
|
|||||
|
(xiv) recognition
and recording of delinquencies, charge-offs and uncollectible
accounts
|
X
|
X
|
||||
|
(xv) maintenance
of external credit enhancement or other support
|
X
|
X
|
X
|
1
The
descriptions of the Item 1122(d) servicing criteria use key words and
phrases
and are not verbatim recitations of the servicing criteria. Refer to
Regulation
AB, Item 1122 for a full description of servicing
criteria.
2
For the
avoidance of doubt, any Relevant Servicing Criteria to be addressed by
Servicer
may be addressed by Servicer or any subservicer or subcontractor, as the
case
may be.
3
Xxxxx
Fargo in its capacity as Paying Agent, Master Servicer and Securities
Administrator.
EXHIBIT
M
FORM
OF
BACK-UP CERTIFICATION
Re: __________
(the “Trust”)
Asset-Backed
Certificates, Series 2007-2
I,
[identify the certifying individual], certify to Nomura Home Equity Loan,
Inc.
(the “Depositor”), HSBC Bank USA, National Association (the “Trustee”) and Xxxxx
Fargo Bank, N.A. (the “Master Servicer”), and their respective officers,
directors and affiliates, and with the knowledge and intent that they will
rely
upon this certification, that:
(1)
I
have
reviewed the servicer compliance statements of [Ocwen Loan Servicing, LLC
(“Ocwen”)][Equity One, Inc. (“Equity One”)][Select Portfolio Servicing, LLC
(“SPS”)] provided in accordance with Item 1123 of Regulation AB (the “Compliance
Statement”), the report on assessment of [Ocwen][Equity One][SPS]’s compliance
with the servicing criteria set forth in Item 1122(d) of Regulation AB (the
“Servicing Criteria”), provided in accordance with Rules 13a-18 and 15d-18 under
Securities Exchange Act of 1934, as amended (the “Exchange Act”) and Item 1122
of Regulation AB (the “Servicing Assessment”), the registered public accounting
firm’s attestation report provided in accordance with Rules 13a-18 and 15d-18
under the Exchange Act and Section 1122(b) of Regulation AB (the “Attestation
Report”), and all servicing reports, officer’s certificates and other
information relating to the servicing of the Mortgage Loans by [Ocwen][Equity
One][SPS] during 200[ ] that were delivered by [Ocwen][Equity One][SPS] to
the
Master Servicer pursuant to the Agreement (collectively, the “Servicer Servicing
Information”);
(2)
Based
on
my knowledge, the Servicer Servicing Information, taken as a whole, does
not
contain any untrue statement of a material fact or omit to state a material
fact
necessary to make the statements made, in the light of the circumstances
under
which such statements were made, not misleading with respect to the period
of
time covered by the Servicer Servicing Information;
(3)
Based
on
my knowledge, all of the Servicer Servicing Information required to be provided
by the Servicer under the Agreement has been provided to the Master
Servicer;
(4)
I
am
responsible for reviewing the activities performed by the Servicer as servicer
under the Agreement, and based on my knowledge and the compliance review
conducted in preparing the Compliance Statement and except as disclosed in
the
Compliance Statement, the Servicing Assessment or the Attestation Report,
[Ocwen][Equity One][SPS] has fulfilled its obligations under the Agreement
in
all material respects; and
(5)
The
Compliance Statement required to be delivered by [Ocwen][Equity One][SPS]
pursuant to the Agreement, and the Servicing Assessment and Attestation Report
required to be provided by [Ocwen][Equity One][SPS] and by any Subservicer
or
Subcontractor pursuant to the Agreement, have been provided to the Master
Servicer. Any material instances of noncompliance described in such reports
have
been disclosed to the Master Servicer. Any material instance of noncompliance
with the Servicing Criteria has been disclosed in such reports.
Capitalized
terms used and not otherwise defined herein have the meanings assigned thereto
in the Pooling and Servicing Agreement (the “Agreement”), dated as of January 1,
2007, among Nomura Home Equity Loan, Inc., Nomura Credit & Capital, Inc.,
Ocwen Loan Servicing, LLC, Equity One, Inc., Select Portfolio Servicing,
LLC,
Xxxxx Fargo Bank, N.A. and HSBC Bank USA, National Association
|
Date:
|
||
|
[Signature]
|
||
|
[Title]
|
||
EXHIBIT
N
FORM
10-D, FORM 8-K AND FORM 10-K
REPORTING
RESPONSIBILITY
As
to
each item described below, the entity indicated as the Responsible Party
shall
be primarily responsible for reporting the information to the party identified
as responsible for preparing the Securities Exchange Act Reports pursuant
to
Section 5.14. An asterisk indicates that the Responsible Party is responsible
for aggregating the information it receives from other Responsible
Parties.
Under
Item 1 of Form 10-D: a) items marked “5.06 statement” are required to be
included in the periodic Distribution Date statement under Section 5.06,
provided by the Securities Administrator based on information received from
the
Master Servicer; and b) items marked “Form 10-D report” are required to be in
the Form 10-D report but not the 5.06 statement, provided by the party
indicated. Information under all other Items of Form 10-D is to be included
in
the Form 10-D report.
Additional
Form 10-D Disclosure
|
ADDITIONAL
FORM 10-D DISCLOSURE
|
|
|
Item
on Form 10-D
|
Party
Responsible
|
|
Item
1: Distribution and Pool Performance Information
|
|
|
Information
included in the [Monthly Statement]
|
Servicers
Master
Servicer
Securities
Administrator
|
|
Any
information required by 1121 which is NOT included on the [Monthly
Statement]
|
Depositor
|
|
Item
2: Legal Proceedings
Any
legal proceeding pending against the following entities or their
respective property, that is material to Certificateholders, including
any
proceedings known to be contemplated by governmental
authorities:
|
|
|
▪
Issuing Entity (Trust Fund)
|
Trustee,
Master Servicer, Securities Administrator and Depositor
|
|
▪
Sponsor (Seller)
|
Seller
(if a party to the Pooling and Servicing Agreement) or
Depositor
|
|
▪
Depositor
|
Depositor
|
|
▪
Trustee
|
Trustee
|
|
▪
Securities Administrator
|
Securities
Administrator
|
|
▪
Master Servicer
|
Master
Servicer
|
|
▪
Custodian
|
Custodian
|
|
▪
1110(b) Originator
|
Depositor
|
|
▪
Any 1108(a)(2) Servicer (other than the Master Servicer or Securities
Administrator)
|
Servicers
|
|
▪
Any other party contemplated by 1100(d)(1)
|
Depositor
|
|
Item
3: Sale of Securities and Use of Proceeds
Information
from Item 2(a) of Part II of Form 10-Q:
With
respect to any sale of securities by the sponsor, depositor or
issuing
entity, that are backed by the same asset pool or are otherwise
issued by
the issuing entity, whether or not registered, provide the sales
and use
of proceeds information in Item 701 of Regulation S-K. Pricing
information
can be omitted if securities were not registered.
|
Depositor
|
|
Item
4: Defaults Upon Senior Securities
Information
from Item 3 of Part II of Form 10-Q:
Report
the occurrence of any Event of Default (after expiration of any
grace
period and provision of any required notice)
|
Securities
Administrator
Trustee
|
|
Item
5: Submission of Matters to a Vote of Security
Holders
Information
from Item 4 of Part II of Form 10-Q
|
Securities
Administrator
Trustee
|
|
Item
6: Significant Obligors of Pool Assets
Item
1112(b) - Significant
Obligor Financial Information*
|
Depositor
|
|
*This
information need only be reported on the Form 10-D for the distribution
period in which updated information is required pursuant to the
Item.
|
|
|
Item
7: Significant Enhancement Provider Information
Item
1114(b)(2) - Credit Enhancement Provider Financial
Information*
|
|
|
▪
Determining applicable disclosure threshold
|
Depositor
|
|
▪
Requesting required financial information (including any required
accountants’ consent to the use thereof) or effecting incorporation by
reference
|
Depositor
|
|
Item
1115(b) - Derivative Counterparty Financial
Information*
|
|
|
▪
Determining current maximum probable exposure
|
Depositor
|
|
▪
Determining current significance percentage
|
Depositor
|
|
▪
Requesting required financial information (including any required
accountants’ consent to the use thereof) or effecting incorporation by
reference
|
Depositor
|
|
*This
information need only be reported on the Form 10-D for the distribution
period in which updated information is required pursuant to the
Items.
|
|
|
Item
8: Other Information
Disclose
any information required to be reported on Form 8-K during the
period
covered by the Form 10-D but not reported
|
Any
party responsible for the applicable Form 8-K Disclosure
item
|
|
Item
9: Exhibits
|
|
|
Monthly
Statement to Certificateholders
|
Securities
Administrator
|
|
Exhibits
required by Item 601 of Regulation S-K, such as material
agreements
|
Depositor
|
Additional
Form 10-K Disclosure
|
ADDITIONAL
FORM 10-K DISCLOSURE
|
|
|
Item
on Form 10-K
|
Party
Responsible
|
|
Item
1B: Unresolved Staff Comments
|
Depositor
|
|
Item
9B: Other Information
Disclose
any information required to be reported on Form 8-K during the
fourth
quarter covered by the Form 10-K but not reported
|
Any
party responsible for disclosure items on Form 8-K
|
|
Item
15: Exhibits, Financial Statement Schedules
|
Securities
Administrator
Depositor
|
|
Reg
AB Item 1112(b): Significant Obligors of Pool
Assets
|
|
|
Significant
Obligor Financial Information*
|
Depositor
|
|
*This
information need only be reported on the Form 10-D for the distribution
period in which updated information is required pursuant to the
Item.
|
|
|
Reg
AB Item 1114(b)(2): Credit Enhancement Provider Financial
Information
|
|
|
▪
Determining applicable disclosure threshold
|
Depositor
|
|
▪
Requesting required financial information (including any required
accountants’ consent to the use thereof) or effecting incorporation by
reference
|
Depositor
|
|
*This
information need only be reported on the Form 10-D for the distribution
period in which updated information is required pursuant to the
Items.
|
|
|
Reg
AB Item 1115(b): Derivative Counterparty Financial
Information
|
|
|
▪
Determining current maximum probable exposure
|
Depositor
|
|
▪
Determining current significance percentage
|
Depositor
|
|
▪
Requesting required financial information (including any required
accountants’ consent to the use thereof) or effecting incorporation by
reference
|
Depositor
|
|
*This
information need only be reported on the Form 10-D for the distribution
period in which updated information is required pursuant to the
Items.
|
|
|
Reg
AB Item 1117: Legal Proceedings
Any
legal proceeding pending against the following entities or their
respective property, that is material to Certificateholders, including
any
proceeding sknown to be contemplated by governmental
authorities:
|
|
|
▪
Issuing Entity (Trust Fund)
|
Trustee,
Master Servicer, Securities Administrator and Depositor
|
|
▪
Sponsor (Seller)
|
Seller
(if a party to the Pooling and Servicing Agreement) or
Depositor
|
|
▪
Depositor
|
Depositor
|
|
▪
Trustee
|
Trustee
|
|
▪
Securities Administrator
|
Securities
Administrator
|
|
▪
Master Servicer
|
Master
Servicer
|
|
▪
Custodian
|
Custodian
|
|
▪
1110(b) Originator
|
Depositor
|
|
▪
Any 1108(a) Servicer (other than the Master Servicer or Securities
Administrator)
|
Servicers
|
|
▪
Any other party contemplated by 1100(d)(1)
|
Depositor
|
|
Reg
AB Item 1119: Affiliations and Relationships
|
|
|
Whether
(a) the Sponsor (Seller), Depositor or Issuing Entity is an affiliate
of
the following parties, and (b) to the extent known and material,
any of
the following parties are affiliated with one another:
|
Depositor
as to (a)
Sponsor/Seller
as to (a)
|
|
▪
Master Servicer
|
Master
Servicer
|
|
▪
Securities Administrator
|
Securities
Administrator
|
|
▪
Trustee
|
Trustee
|
|
▪
Any 1108(a)(2) servicer (other than Master Servicer or Securities
Administrator)
|
Servicers
|
|
▪
Any 1110 Originator
|
Depositor/Sponsor
|
|
▪
Any 1112(b) Significant Obligor
|
Depositor/Sponsor
|
|
▪
Any 1114 Credit Enhancement Provider
|
Depositor/Sponsor
|
|
▪
Any 1115 Derivative Counterparty Provider
|
Depositor/Sponsor
|
|
▪
Any other 1101(d)(1) material party
|
Depositor/Sponsor
|
|
Whether
there are any “outside the ordinary course business arrangements” other
than would be obtained in an arm’s length transaction between (a) the
Sponsor (Seller), Depositor or Issuing Entity on the one hand,
and (b) any
of the following parties (or their affiliates) on the other hand,
that
exist currently or within the past two years and that are material
to a
Certificateholder’s understanding of the Certificates:
|
Depositor
as to (a)
Sponsor/Seller
as to (a)
|
|
▪
Master Servicer
|
Master
Servicer
|
|
▪
Securities Administrator
|
Securities
Administrator
|
|
▪
Trustee
|
Depositor/Sponsor
|
|
▪
Any 1108(a)(2) servicer (other than Master Servicer or Securities
Administrator)
|
Depositor/Sponsor
|
|
▪
Any 1110 Originator
|
Depositor/Sponsor
|
|
▪
Any 1112(b) Significant Obligor
|
Depositor/Sponsor
|
|
▪
Any 1114 Credit Enhancement Provider
|
Depositor/Sponsor
|
|
▪
Any 1115 Derivative Counterparty Provider
|
Depositor/Sponsor
|
|
▪
Any other 1101(d)(1) material party
|
Depositor/Sponsor
|
|
Whether
there are any specific relationships involving the transaction
or the pool
assets between (a) the Sponsor (Seller), Depositor or Issuing Entity
on
the one hand, and (b) any of the following parties (or their affiliates)
on the other hand, that exist currently or within the past two
years and
that are material:
|
Depositor
as to (a)
Sponsor/Seller
as to (a)
|
|
▪
Master Servicer
|
Master
Servicer
|
|
▪
Securities Administrator
|
Securities
Administrator
|
|
▪
Trustee
|
Depositor/Sponsor
|
|
▪
Any 1108(a)(2) servicer (other than Master Servicer or Securities
Administrator)
|
Servicers
|
|
▪
Any 1110 Originator
|
Depositor/Sponsor
|
|
▪
Any 1112(b) Significant Obligor
|
Depositor/Sponsor
|
|
▪
Any 1114 Credit Enhancement Provider
|
Depositor/Sponsor
|
|
▪
Any 1115 Derivative Counterparty Provider
|
Depositor/Sponsor
|
|
▪
Any other 1101(d)(1) material party
|
Depositor/Sponsor
|
Form
8-K
Disclosure Information
|
FORM
8-K DISCLOSURE INFORMATION
|
|
|
Item
on Form 8-K
|
Party
Responsible
|
|
Item
1.01- Entry into a Material Definitive Agreement
Disclosure
is required regarding entry into or amendment of any definitive
agreement
that is material to the securitization, even if depositor is not
a party.
Examples:
servicing agreement, custodial agreement.
Note:
disclosure not required as to definitive agreements that are fully
disclosed in the prospectus
|
All
parties
|
|
Item
1.02- Termination of a Material Definitive Agreement
Disclosure
is required regarding termination of any definitive agreement that
is
material to the securitization (other than expiration in accordance
with
its terms), even if depositor is not a party.
Examples:
servicing agreement, custodial agreement.
|
All
parties
|
|
Item
1.03- Bankruptcy or Receivership
Disclosure
is required regarding a bankruptcy or receivership with respect
to any of
the following:
|
|
|
▪
Sponsor (Seller)
|
Depositor/Sponsor
(Seller)
|
|
▪
Depositor
|
Depositor
|
|
▪
Master Servicer
|
Master
Servicer
|
|
▪
Any 1108(a)(2) servicer (other than Master Servicer or Securities
Administrator)
|
Servicers
|
|
▪
Other Servicer servicing 20% or more of the pool assets at the
time of the
report
|
Servicers
|
|
▪
Other material servicers
|
Servicers
|
|
▪
Trustee
|
Trustee
|
|
▪
Securities Administrator
|
Securities
Administrator
|
|
▪
Significant Obligor
|
Depositor
|
|
▪
Credit Enhancer (10% or more)
|
Depositor
|
|
▪
Derivative Counterparty
|
Depositor
|
|
▪
Custodian
|
Custodian
|
|
Item
2.04- Triggering Events that Accelerate or Increase a Direct Financial
Obligation or an Obligation under an Off-Balance Sheet
Arrangement
Includes
an early amortization, performance trigger or other event, including
event
of default, that would materially alter the payment priority/distribution
of cash flows/amortization schedule.
Disclosure
will be made of events other than waterfall triggers which are
disclosed
in the monthly statements to the certificateholders.
|
Depositor
Master
Servicer
Securities
Administrator
|
|
Item
3.03- Material Modification to Rights of Security
Holders
Disclosure
is required of any material modification to documents defining
the rights
of Certificateholders, including the Pooling and Servicing
Agreement.
|
Securities
Administrator
Trustee
Depositor
|
|
Item
5.03- Amendments of Articles of Incorporation or Bylaws; Change
of Fiscal
Year
Disclosure
is required of any amendment “to the governing documents of the issuing
entity”.
|
Depositor
|
|
Item
6.01- ABS Informational and Computational
Material
|
Depositor
|
|
Item
6.02- Change of 1108(a)(2) Servicer or Trustee
Requires
disclosure of the resignation, removal, replacement, substitution
or
addition of any 1108(a)(2) servicer, affiliated servicer or trustee,
together with any disclosure required under Item 1108(d) of Regulation
AB.
|
Master
Servicer/Securities Administrator/Depositor/
Servicers/Trustee
|
|
Item
6.03- Change in Credit Enhancement or External
Support
Covers
termination of any enhancement in manner other than by its terms,
the
addition of an enhancement, or a material change in the enhancement
provided. Applies to external credit enhancements as well as derivatives.
|
Depositor/Securities
Administrator/Trustee
|
|
Reg
AB disclosure about any new enhancement provider is also
required.
|
Depositor
|
|
Item
6.04- Failure to Make a Required Distribution
|
Securities
Administrator
Trustee
|
|
Item
6.05- Securities Act Updating Disclosure
If
any material pool characteristic differs by 5% or more at the time
of
issuance of the securities from the description in the final prospectus,
provide updated Reg AB disclosure about the actual asset
pool.
|
Depositor
|
|
If
there are any new servicers or originators required to be disclosed
under
Regulation AB as a result of the foregoing, provide the information
called
for in Items 1108 and 1110 respectively.
|
Depositor
|
|
Item
7.01- Reg FD Disclosure
|
All
parties
|
|
Item
8.01- Other Events
Any
event, with respect to which information is not otherwise called
for in
Form 8-K, that the registrant deems of importance to
certificateholders.
|
Depositor
|
|
Item
9.01- Financial Statements and Exhibits
|
Responsible
party for reporting/disclosing the financial statement or
exhibit
|
EXHIBIT
O
APPENDIX
E - Standard & Poor’s Anti-Predatory Lending
Categorization
Standard
& Poor’s has categorized loans governed by anti-predatory lending laws in
the Jurisdictions listed below into three categories based upon a combination
of
factors that include (a) the risk exposure associated with the assignee
liability and (b) the tests and thresholds set forth in those laws. Note
that
certain loans classified by the relevant statute as Covered are included
in
Standard & Poor’s High Cost Loan Category because they included thresholds
and tests that are typical of what is generally considered High Cost by the
industry.
Standard
& Poor’s High Cost Loan Categorization
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending Law/Effective Date
|
Category
under Applicable Anti-Predatory Lending Law
|
|
Arkansas
|
Arkansas
Home Loan Protection Act, Ark. Code Xxx. §§ 00-00-000 et
seq.
Effective
July 16, 2003
|
High
Cost Home Loan
|
|
Cleveland
Heights, OH
|
Ordinance
No. 72-2003 (PSH), Mun. Code §§ 757.01 et
seq.
Effective
June 2, 2003
|
Covered
Loan
|
|
Colorado
|
Consumer
Equity Protection, Colo. Stat. Xxx. §§ 5-3.5-101 et
seq.
Effective
for covered loans offered or entered into on or after January 1,
2003.
Other provisions of the Act took effect on June 7, 2002
|
Covered
Loan
|
|
Connecticut
|
Connecticut
Abusive Home Loan Lending Practices Act, Conn. Gen. Stat. §§ 36a-746
et
seq.
Effective
October 1, 2001
|
High
Cost Home Loan
|
|
District
of Columbia
|
Home
Loan Protection Act, D.C. Code §§ 26-1151.01 et
seq.
Effective
for loans closed on or after January 28, 2003
|
Covered
Loan
|
|
Florida
|
Fair
Lending Act, Fla. Stat. Xxx. §§ 494.0078 et
seq.
Effective
October 2, 2002
|
High
Cost Home Loan
|
|
Georgia
(Oct. 1, 2002 - Mar. 6, 2003)
|
Georgia
Fair Lending Act, Ga. Code Xxx. §§ 7-6A-1 et
seq.
Effective
October 1, 2002 - March 6, 2003
|
High
Cost Home Loan
|
Standard
& Poor’s High Cost Loan Categorization
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending Law/Effective Date
|
Category
under Applicable Anti-Predatory Lending Law
|
|
Georgia
as amended (Mar. 7, 2003 - current)
|
Georgia
Fair Lending Act, Ga. Code Xxx. §§ 7-6A-1 et
seq.
Effective
for loans closed on or after March 7, 2003
|
High
Cost Home Loan
|
|
HOEPA
Section 32
|
Home
Ownership and Equity Protection Act of 1994, 15 U.S.C. § 1639, 12 C.F.R.
§§ 226.32 and 226.34
Effective
October 1, 1995, amendments October 1, 2002
|
High
Cost Loan
|
|
Illinois
|
High
Risk Home Loan Act, Ill. Comp. Stat. tit. 815, §§ 137/5 et
seq.
Effective
January 1, 2004 (prior to this date, regulations under Residential
Mortgage License Act effective from May 14, 2001)
|
High
Risk Home Loan
|
|
Kansas
|
Consumer
Credit Code, Kan. Stat. Xxx. §§ 16a-1-101 et
seq.
Sections
16a-1-301 and 16a-3-207 became effective April 14, 1999; Section
16a-3-308a became effective July 1, 1999
|
High
Loan to Value Consumer Loan (id.
§
16a-3-207) and;
|
|
High
APR Consumer Loan (id.
§
16a-3-308a)
|
||
|
Kentucky
|
2003
KY H.B. 000 - Xxxx Xxxx Xxxx Xxxx Xxx, Xx. Rev. Stat. §§ 360.100
et
seq.
Effective
June 24, 2003
|
High
Cost Home Loan
|
|
Maine
|
Truth
in Lending, Me. Rev. Stat. tit. 9-A, §§ 8-101 et
seq.
Effective
September 29, 1995 and as amended from time to time
|
High
Rate High Fee Mortgage
|
|
Massachusetts
|
Part
40 and Part 32, 209 C.M.R. §§ 32.00 et
seq.
and 209 C.M.R. §§ 40.01 et
seq.
Effective
March 22, 2001 and amended from time to time
|
High
Cost Home Loan
|
Standard
& Poor’s High Cost Loan Categorization
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending Law/Effective Date
|
Category
under Applicable Anti-Predatory Lending Law
|
|
|
Nevada
|
Assembly
Xxxx No. 284, Nev. Rev. Stat. §§ 598D.010 et
seq.
Effective
October 1, 2003
|
Home
Loan
|
|
|
New
Jersey
|
New
Jersey Home Ownership Security Act of 2002, N.J. Rev. Stat. §§ 46:10B-22
et
seq.
Effective
for loans closed on or after November 27, 2003
|
High
Cost Home Loan
|
|
|
New
Mexico
|
Home
Loan Protection Act, N.M. Rev. Stat. §§ 58-21A-1 et
seq.
Effective
as of January 1, 2004; Revised as of February 26, 2004
|
High
Cost Home Loan
|
|
|
New
York
|
N.Y.
Banking Law Article 6-l
Effective
for applications made on or after April 1, 2003
|
High
Cost Home Loan
|
|
|
North
Carolina
|
Restrictions
and Limitations on High Cost Home Loans, N.C. Gen. Stat. §§ 24-1.1E
et
seq.
Effective
July 1, 2000; amended October 1, 2003 (adding open-end lines
of credit)
|
High
Cost Home Loan
|
|
|
Ohio
|
H.B.
386 (codified in various sections of the Ohio Code), Ohio Rev.
Code Xxx.
§§ 1349.25 et
seq.
Effective
May 24, 2002
|
Covered
Loan
|
|
|
Oklahoma
|
Consumer
Credit Code (codified in various sections of Title 14A)
Effective
July 1, 2000; amended effective January 1, 2004
|
Subsection
10 Mortgage
|
|
|
South
Carolina
|
South
Carolina High Cost and Consumer Home Loans Act, S.C. Code Xxx.
§§ 37-23-10
et
seq.
Effective
for loans taken on or after January 1, 2004
|
High
Cost Home Loan
|
|
|
West
Virginia
|
West
Virginia Residential Mortgage Lender, Broker and Servicer Act,
W. Va. Code
Xxx. §§ 31-17-1 et
seq.
Effective
June 5, 0000
|
Xxxx
Xxxxxxxx Mortgage Loan Act Loan
|
|
Standard
& Poor’s Covered Loan Categorization
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending Law/Effective Date
|
Category
under Applicable Anti-Predatory Lending Law
|
|
Georgia
(Oct. 1, 2002 - Mar. 6, 2003)
|
Georgia
Fair Lending Act, Ga. Code Xxx. §§ 7-6A-1 et
seq.
Effective
October 1, 2002 - March 6, 2003
|
Covered
Loan
|
|
New
Jersey
|
New
Jersey Home Ownership Security Act of 2002, N.J. Rev. Stat. §§ 46:10B-22
et
seq.
Effective
November 27, 2003 - July 5, 2004
|
Covered
Home Loan
|
Standard
& Poor’s Home Loan Categorization
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending Law/Effective Date
|
Category
under Applicable Anti-Predatory Lending Law
|
|
Georgia
(Oct. 1, 2002 - Mar. 6, 2003)
|
Georgia
Fair Lending Act, Ga. Code Xxx. §§ 7-6A-1 et
seq.
Effective
October 1, 2002 - March 6, 2003
|
Home
Loan
|
|
New
Jersey
|
New
Jersey Home Ownership Security Act of 2002, N.J. Rev. Stat. §§ 46:10B-22
et
seq.
Effective
for loans closed on or after November 27, 2003
|
Home
Loan
|
|
New
Mexico
|
Home
Loan Protection Act, N.M. Rev. Stat. §§ 58-21A-1 et
seq.
Effective
as of January 1, 2004; Revised as of February 26, 2004
|
Home
Loan
|
|
North
Carolina
|
Restrictions
and Limitations on High Cost Home Loans, N.C. Gen. Stat. §§ 24-1.1E
et
seq.
Effective
July 1, 2000; amended October 1, 2003 (adding open-end lines of
credit)
|
Consumer
Home Loan
|
|
South
Carolina
|
South
Carolina High Cost and Consumer Home Loans Act, S.C. Code Xxx.
§§ 37-23-10
et
seq.
Effective
for loans taken on or after January 1, 2004
|
Consumer
Home Loan
|
EXHIBIT
P
BASIS
RISK CAP AGREEMENT
HSBC
Bank
USA, National Association
000
Xxxxx
Xxxxxx
Xxx
Xxxx,
XX 00000
Fax:
(000) 000-0000
|
DATE:
|
January
31, 2007
|
|
TO:
|
HSBC
Bank USA, National Association, not individually, but solely
as
Supplemental Interest Trust Trustee on behalf of the Supplemental
Interest
Trust with respect to the Nomura Home Equity Loan, Inc., Home
Equity Loan
Trust, Series 2007-2
|
|
ATTENTION:
|
HSBC
Bank USA, National Association
|
|
000
Xxxxx Xxx.
|
|
|
Xxx
Xxxx, XX 00000
|
|
|
FACSIMILE:
|
000-000-0000
|
|
with
a copy to:
|
|
|
ATTENTION:
|
Xxxxx
Fargo Bank, N.A.
|
|
0000
Xxx Xxxxxxxxx Xxxx
|
|
|
Xxxxxxxx,
XX 00000
|
|
|
Attn:
Client Manager, NHEL 2007-2
|
|
|
FACSIMILE:
|
000-000-0000
|
|
FROM:
|
HSBC
Bank USA, National Association
|
|
TELEPHONE :
|
000-000-0000
|
|
FACSIMILE:
|
000-000-0000
|
|
SUBJECT:
|
Fixed
Income Derivatives Confirmation
|
|
REFERENCE
NUMBER:
|
453997HN/453998HN
|
The
purpose of this long-form confirmation (“Confirmation”)
is to
confirm the terms and conditions of the current Transaction entered into
on the
Trade Date specified below (the “Transaction”)
between
HSBC Bank USA, National Association (“Party
A”)
and
HSBC
Bank
USA, National Association, not individually, but solely as supplemental
interest
trust trustee (the “Supplemental Interest Trust Trustee”) on behalf of the
supplemental interest trust with respect to the Nomura Home Equity Loan,
Inc.,
Home Equity Loan Trust, Series 2007-2 (the “Supplemental
Interest Trust”)
(“Party
B”)
created
under the Pooling and Servicing Agreement, dated as of January 1, 2007,
among
Nomura Home Equity Loan, Inc., as depositor (the “Depositor”),
Nomura Credit & Capital, Inc., as sponsor (the “Sponsor”),
Xxxxx
Fargo Bank, N.A., as master servicer (the “Master
Servicer”)
and
securities administrator (the “Securities
Administrator”),
Ocwen
Loan Servicing, LLC, Select Portfolio Servicing Inc. and Equity One, Inc.,
each
as servicer (each a “Servicer”
and
collectively, the “Servicers”)
and
HSBC Bank USA, National Association, not in its individual capacity, but
solely
as trustee (the “Trustee”) (the
“Pooling
and Servicing Agreement”).
This
Confirmation evidences a complete and binding agreement between you and
us to
enter into the Transaction on the terms set forth below and replaces any
previous agreement between us with respect to the subject matter hereof.
This
Confirmation constitutes a “Confirmation”
and also
constitutes a “Schedule”
as
referred to in the ISDA Master Agreement, and Paragraph 13 of a Credit
Support
Annex to the Schedule.
| 1. |
This
Confirmation shall supplement, form a part of, and be subject to
an
agreement in the form of the ISDA Master Agreement (Multicurrency
- Cross
Border) as published and copyrighted in 1992 by the International
Swaps
and Derivatives Association, Inc. (the “ISDA
Master Agreement”),
as if Party A and Party B had executed an agreement in such form
on the
date hereof, with a Schedule as set forth in Item 3 of this Confirmation,
and an ISDA Credit Support Annex (Bilateral Form - ISDA Agreements
Subject
to New York Law Only version) as published and copyrighted in 1994
by the
International Swaps and Derivatives Association, Inc., with Paragraph
13
thereof as set forth in Annex A hereto (the “Credit
Support Annex”).
For the avoidance of doubt, the Transaction described herein shall
be the
sole Transaction governed by such ISDA Master Agreement. In the
event of
any inconsistency among any of the following documents, the relevant
document first listed shall govern: (i) this Confirmation, exclusive
of
the provisions set forth in Item 3 hereof and Annex A hereto; (ii)
the
provisions set forth in Item 3 hereof, which are incorporated by
reference
into the Schedule; (iii) the Credit Support Annex; (iv) the Definitions;
and (v) the ISDA Master Agreement.
|
Each
reference herein to a “Section” (unless specifically referencing the Pooling and
Servicing Agreement) or to a “Section” “of this Agreement” will be construed as
a reference to a Section of the ISDA Master Agreement; each herein reference
to
a “Part” will be construed as a reference to the provisions herein deemed
incorporated in a Schedule to the ISDA Master Agreement; each reference
herein
to a “Paragraph” will be construed as a reference to a Paragraph of the Credit
Support Annex.
|
2.
|
The
terms of the particular Transaction to which this Confirmation
relates are
as follows:
|
|
Type
of Transaction:
|
Interest
Rate Cap
|
|
Notional
Amount:
|
With
respect to any Calculation Period the Calculation
Amount set forth for such period in Schedule I, which is attached
hereto
and incorporated by reference into this Confirmation.
|
|
Trade
Date:
|
January
29, 2007
|
|
Effective
Date:
|
January
31, 2007
|
|
Termination
Date:
|
July
25, 2007, subject to adjustment in accordance with the Following
Business
Day Convention.
|
|
Fixed
Amount:
|
As
per side agreement
|
|
Party
A Floating Amounts:
|
|
|
Party
A
|
|
|
Period
End Dates:
|
The
25th
calendar day of each month during the Term of this Transaction,
commencing
February 25, 2007, and ending on the Termination Date, subject
to
adjustment in accordance with the Following Business Day
Convention.
|
|
Floating
Rate Payer
|
|
|
Payment
Dates:
|
Early
Payment shall be applicable. The Floating Rate payer Payment
Date shall be
two Business Days prior to such Floating Rate Payer Period End
Date
|
|
Cap
Rate:
|
As
set forth in Schedule I
|
|
Floating
Rate Option:
|
USD-LIBOR-BBA;
provided, however, that if the Floating Rate Option for any Calculation
Period is greater than 10.500000%, then the Floating Rate Option
for such
Calculation Period shall be deemed to be 10.500000%.
|
|
Designated
Maturity:
|
One
month
|
|
Floating
Rate Day
|
|
|
Count
Fraction:
|
Actual/360
|
|
Reset
Dates:
|
The
first day of each Calculation Period.
|
|
Compounding:
|
Inapplicable
|
|
Business
Days:
|
New
York
|
|
Business
Day Convention:
|
Following
|
|
3.
|
Provisions
Deemed Incorporated in a Schedule to the ISDA Master
Agreement:
|
|
Part
1.
|
Termination
Provisions.
|
For
the
purposes of this Agreement:-
(a) “Specified
Entity”
will not
apply to Party A or Party B for any purpose.
|
(b)
|
“Specified
Transaction”
will have the meaning specified in Section
14.
|
|
(c)
|
Events
of Default.
|
The
statement below that an Event of Default will apply to a specific party
means
that upon the occurrence of such an Event of Default with respect to such
party,
the other party shall have the rights of a Non-defaulting Party under Section
6
of this Agreement; conversely, the statement below that such event will
not
apply to a specific party means that the other party shall not have such
rights.
| (i) |
The
“Failure
to Pay or Deliver”
provisions of Section 5(a)(i) will apply to Party A and will apply
to
Party B; provided, however, that Section 5(a)(i) is hereby amended
by
replacing the word “third” with the word “first”; provided, further, that
notwithstanding anything to the contrary in Section 5(a)(i), any
failure
by Party A to comply with or perform any obligation to be complied
with or
performed by Party A under the Credit Support Annex shall not constitute
an Event of Default under Section 5(a)(i) unless (A) a Required
Ratings
Downgrade Event has occurred and been continuing for 30 or more
Local
Business Days, and (B) such failure is not remedied on or before
the third
Local Business Day after notice of such failure is given to Party
A.
|
| (ii) |
The
“Breach
of Agreement”
provisions of Section 5(a)(ii) will apply to Party A and will not
apply to
Party B.
|
| (iii) |
The
“Credit
Support Default”
provisions of Section 5(a)(iii) will apply to Party A and will
not apply
to Party B except that Section 5(a)(iii)(1) will apply to Party
B solely
in respect of Party B’s obligations under Paragraph 3(b) of the Credit
Support Annex; provided, however, that notwithstanding anything
to the
contrary in Section 5(a)(iii)(1), any failure by Party A to comply
with or
perform any obligation to be complied with or performed by Party
A under
the Credit Support Annex shall not constitute an Event of Default
under
Section 5(a)(iii) unless (A) a Required Ratings Downgrade Event
has
occurred and been continuing for 30 or more Local Business Days,
and (B)
such failure is not remedied on or before the third Local Business
Day
after notice of such failure is given to Party
A.
|
| (iv) |
The
“Misrepresentation”
provisions of Section 5(a)(iv) will apply to Party A and will not
apply to
Party B.
|
| (v) |
The
“Default
under Specified Transaction”
provisions of Section 5(a)(v) will apply to Party A and will not
apply to
Party B.
|
| (vi) |
The
“Cross
Default”
provisions of Section 5(a)(vi) will apply to Party A and will not
apply to
Party B. For purposes of Section 5(a)(vi), solely with respect
to Party
A:
|
“Specified
Indebtedness” will have the meaning specified in Section 14, except that such
term shall not include obligations in respect of deposits received in the
ordinary course of Party A’s banking business.
“Threshold
Amount” means with respect to Party A an amount equal to three percent (3%) of
the Shareholders’ Equity of Party A (as set forth in Party A’s Call Report) or,
if applicable, the Eligible Guarantor.
“Shareholders’
Equity” means with respect to an entity, at any time, the sum (as shown in the
most recent annual audited financial statements of such entity) of (i)
its
capital stock (including preferred stock) outstanding, taken at par value,
(ii)
its capital surplus and (iii) its retained earnings, minus (iv) treasury
stock,
each to be determined in accordance with generally accepted accounting
principles.
| (vii) |
The
“Bankruptcy”
provisions of Section 5(a)(vii) will apply to Party A and will
apply to
Party B except that the provisions of Section 5(a)(vii)(2), (6)
(to the
extent that such provisions refer to any appointment contemplated
or
effected by the Pooling and Servicing Agreement or any appointment
to
which Party B has not become subject), (7) and (9) will not apply
to Party
B; provided that, with respect to Party B only, Section 5(a)(vii)(4)
is
hereby amended by adding after the words “against it” the words
“(excluding any proceeding or petition instituted or presented by
Party A
or its Affiliates)”, and Section 5(a)(vii)(8) is hereby amended by
deleting the words “to (7) inclusive” and inserting lieu thereof “, (3),
(4) as amended, (5), (6) as amended, or
(7)”.
|
| (viii) |
The
“Merger
Without Assumption”
provisions of Section 5(a)(viii) will apply to Party A and will
not apply
to Party B.
|
(d)
Termination
Events.
The
statement below that a Termination Event will apply to a specific party
means
that upon the occurrence of such a Termination Event, if such specific
party is
the Affected Party with respect to a Tax Event, the Burdened Party with
respect
to a Tax Event Upon Merger (except as noted below) or the non-Affected
Party
with respect to a Credit Event Upon Merger, as the case may be, such specific
party shall have the right to designate an Early Termination Date in accordance
with Section 6 of this Agreement; conversely, the statement below that
such an
event will not apply to a specific party means that such party shall not
have
such right; provided, however, with respect to “Illegality” the statement that
such event will apply to a specific party means that upon the occurrence
of such
a Termination Event with respect to such party, either party shall have
the
right to designate an Early Termination Date in accordance with Section
6 of
this Agreement.
(i)
The
“Illegality”
provisions of Section 5(b)(i) will apply to Party A and will apply to Party
B.
|
(ii)
|
The
“Tax
Event”
provisions of Section 5(b)(ii) will apply to Party A except that,
for
purposes of the application of Section 5(b)(ii) to Party A, Section
5(b)(ii) is hereby amended by deleting the words “(x) any action taken by
a taxing authority, or brought in a court of competent jurisdiction,
on or
after the date on which a Transaction is entered into (regardless
of
whether such action is taken or brought with respect to a party
to this
Agreement) or (y)”, and the “Tax
Event”
provisions of Section 5(b)(ii) will apply to Party B.
|
|
(iii)
|
The
“Tax
Event Upon Merger”
provisions of Section 5(b)(iii) will apply to Party A and will
apply to
Party B, provided that Party A shall not be entitled to designate
an Early
Termination Date by reason of a Tax Event upon Merger in respect
of which
it is the Affected Party.
|
|
(iv)
|
The
“Credit
Event Upon Merger”
provisions of Section 5(b)(iv) will not apply to Party A and
will not
apply to Party B.
|
|
(e)
|
The
“Automatic
Early Termination”
provision of Section 6(a) will not apply to Party A and will
not apply to
Party B.
|
(f)
Payments
on Early Termination.
For the
purpose of Section 6(e) of this Agreement:
| (i) |
Market
Quotation will apply, provided, however, that, in the event of
a
Derivative Provider Trigger Event, the following provisions will
apply:
|
|
(A)
|
The
definition of Market Quotation in Section 14 shall be deleted
in its
entirety and replaced with the
following:
|
“Market
Quotation” means,
with respect to one or more Terminated Transactions, a Firm Offer which
is (1)
made by a Reference Market-maker that is an Eligible Replacement, (2) for
an
amount that would be paid to Party B (expressed as a negative number) or
by
Party B (expressed as a positive number) in consideration of an agreement
between Party B and such Reference Market-maker to enter into a Replacement
Transaction, and (3) made on the basis that Unpaid Amounts in respect of
the
Terminated Transaction or group of Transactions are to be excluded but,
without
limitation, any payment or delivery that would, but for the relevant Early
Termination Date, have been required (assuming satisfaction of each applicable
condition precedent) after that Early Termination Date is to be included.
|
(B)
|
The
definition of Settlement Amount shall be deleted in its entirety
and
replaced with the following:
|
“Settlement
Amount”
means,
with respect to any Early Termination Date, an amount (as determined by
Party B)
equal to:
|
(a)
|
If
a Market Quotation for the relevant Terminated Transaction or
group of
Terminated Transactions is accepted by Party B so as to become
legally
binding on or before the day falling ten Local Business Days
after the day
on which the Early Termination Date is designated, or such later
day as
Party B may specify in writing to Party A, but in either case
no later
than one Local Business Day prior to the Early Termination Date
(such day,
the “Latest Settlement Amount Determination Day”), the Termination
Currency Equivalent of the amount (whether positive or negative)
of such
Market Quotation;
|
|
(b)
|
If,
on the Latest Settlement Amount Determination Day, no Market
Quotation for
the relevant Terminated Transaction or group of Terminated Transactions
has been accepted by Party B so as to become legally binding
and one or
more Market Quotations from
Approved Replacements have
been made and remain capable of becoming legally binding upon
acceptance,
the Settlement Amount shall equal the Termination Currency Equivalent
of
the amount (whether positive or negative) of the lowest of such
Market
Quotations (for the avoidance of doubt, the lowest of such Market
Quotations shall be the lowest Market Quotation of
such Market Quotations
expressed as a positive number or, if any of such Market Quotations
is
expressed as a negative number, the Market Quotation expressed
as a
negative number with the largest absolute value);
or
|
|
(c)
|
If,
on the Latest Settlement Amount Determination Day, no Market
Quotation for
the relevant Terminated Transaction or group of Terminated Transactions
is
accepted by Party B so as to become legally binding and no Market
Quotation from an Approved Replacement remains capable of becoming
legally
binding upon acceptance, the Settlement Amount shall equal Party
B’s Loss
(whether positive or negative and without reference to any Unpaid
Amounts)
for the relevant Terminated Transaction or group of Terminated
Transactions.
|
|
(C)
|
If
Party B requests Party A in writing to obtain Market Quotations,
Party A
shall use its reasonable efforts to do so before the Latest Settlement
Amount Determination Day.
|
|
(D)
|
If
the Settlement Amount is a negative number, Section 6(e)(i)(3)
shall be
deleted in its entirety and replaced with the
following:
|
“(3)
Second
Method and Market Quotation.
If the
Second Method and Market Quotation apply, (I) Party B shall pay to Party
A an
amount equal to the absolute value of the Settlement Amount in respect
of the
Terminated Transactions, (II) Party B shall pay to Party A the Termination
Currency Equivalent of the Unpaid Amounts owing to Party A and (III) Party
A
shall pay to Party B the Termination Currency Equivalent of the Unpaid
Amounts
owing to Party B; provided, however, that (x) the amounts payable under
the
immediately preceding clauses (II) and (III) shall be subject to netting
in
accordance with Section 2(c) of this Agreement and (y) notwithstanding
any other
provision of this Agreement, any amount payable by Party A under the immediately
preceding clause (III) shall not be netted-off against any amount payable
by
Party B under the immediately preceding clause (I).”
|
(E)
|
At
any time on or before the Latest Settlement Amount Determination
Day at
which two or more Market Quotations from Approved Replacements
remain
capable of becoming legally binding upon acceptance, Party B
shall be
entitled to accept only the lowest of such Market Quotations
(for the
avoidance of doubt, the lowest of such Market Quotations shall
be the
lowest Market Quotation of such Market Quotations expressed as
a positive
number or, if any of such Market Quotations is expressed as a
negative
number, the Market Quotation expressed as a negative number with
the
largest absolute value).
|
| (ii) |
The
Second Method will apply.
|
(g)
“Termination
Currency”
means
USD.
(h)
Additional
Termination Events.
Additional Termination Events will apply as provided in Part 5(c).
Part
2. Tax
Matters.
(a)
Tax
Representations.
|
(i)
|
Payer
Representations.
For the purpose of Section 3(e) of this Agreement:
|
(A)
Party
A
makes the following representation(s):
It
is not
required by any applicable law, as modified by the practice of any relevant
governmental revenue authority, of any Relevant Jurisdiction to make any
deduction or withholding for or on account of any Tax from any payment
(other
than interest under Section 2(e), 6(d)(ii) or 6(e) of this Agreement) to
be made
by it to the other party under this Agreement. In making this representation,
it
may rely on: (i) the accuracy of any representations made by the other
party
pursuant to Section 3(f) of this Agreement; (ii) the satisfaction of the
agreement contained in Section 4(a)(i) or 4(a)(iii) of this Agreement and
the
accuracy and effectiveness of any document provided by the other party
pursuant
to Section 4(a)(i) or 4(a)(iii) of this Agreement; and (iii) the satisfaction
of
the agreement of the other party contained in Section 4(d) of this Agreement,
provided that it shall not be a breach of this representation where reliance
is
placed on clause (ii) and the other party does not deliver a form or document
under Section 4(a)(iii) by reason of material prejudice to its legal or
commercial position.
(B)
Party
B
makes the following representation(s):
None.
(ii)
Payee
Representations.
For the
purpose of Section 3(f) of this Agreement:
(A)
Party
A
makes the following representation(s):
Party
A
is a national banking association organized under the federal laws of the
United
States and its U.S. taxpayer identification number is 00-0000000.
(B)
Party
B
makes the following representation(s):
None.
|
(b)
|
Tax
Provisions.
|
|
(i)
|
Gross
Up.
Section 2(d)(i)(4) shall not apply to Party B as X, and Section
2(d)(ii)
shall not apply to Party B as Y, in each case such that Party
B shall not
be required to pay any additional amounts referred to
therein.
|
|
(ii)
|
Indemnifiable
Tax.
The definition of “Indemnifiable Tax” in Section 14 is deleted in its
entirety and replaced with the
following:
|
“Indemnifiable
Tax”
means,
in relation to payments by Party A, any Tax and, in relation to payments
by
Party B, no Tax.
Part
3. Agreement
to Deliver Documents.
(a)
For
the
purpose of Section 4(a)(i), tax forms, documents, or certificates to be
delivered are:
|
Party
required to deliver document
|
Form/Document/
Certificate
|
Date
by which to
be
delivered
|
|
|
Party
A
|
A
correct, complete and duly executed U.S. Internal Revenue Service
Form W-9
or other applicable form (or successor thereto), together with
appropriate
attachments, that eliminates U.S. federal withholding and backup
withholding Tax on payments to Party A under this
Agreement.
|
(i)
upon execution of this Agreement, (ii) on or before the first
payment date
under this Agreement, including any Credit Support Document,
(iii)
promptly upon the reasonable demand by Party B, (iv) prior to
the
expiration or obsolescence of any previously delivered form,
and (v)
promptly upon the information on any such previously delivered form
becoming inaccurate or incorrect
|
|
|
Party
B
|
Party
B will deliver at closing a correct, complete and duly executed
U.S.
Internal Revenue Service Form W-9 or other applicable form (or
successor
thereto), together with appropriate attachments, and may deliver
other
tax forms
relating to the beneficial owner of payments to Party B under
this
Agreement from time to time
|
(i)
upon execution of this Agreement, (ii) on or before the first
payment date
under this Agreement, including any Credit Support Document,
(iii)
promptly upon the reasonable demand by Party A, (iv) prior to
the
expiration or obsolescence of any previously delivered form,
and (v)
promptly upon the information on any such previously delivered form
becoming inaccurate or incorrect
|
(b)
For
the
purpose of Section 4(a)(ii), other documents to be delivered are:
|
Party
required to deliver document
|
Form/Document/
Certificate
|
Date
by which to
be
delivered
|
Covered
by Section 3(d) Representation
|
|
|
Party
A and
Party
B
|
Any
documents required by the receiving party to evidence the authority
of the
delivering party or its Credit Support Provider, if any, for
it to execute
and deliver the Agreement, this Confirmation, and any Credit
Support
Documents to which it is a party, and to evidence the authority
of the
delivering party or its Credit Support Provider to perform its
obligations
under the Agreement, this Confirmation and any Credit Support
Document, as
the case may be
|
Upon
the execution and delivery of this Agreement
|
Yes
|
|
|
Party
A and
Party
B
|
A
certificate of an authorized officer of the party, as to the
incumbency
and authority of the respective officers of the party signing
the
Agreement, this Confirmation, and any relevant Credit Support
Document, as
the case may be
|
Upon
the execution and delivery of this Agreement
|
Yes
|
|
|
Party
A
|
Annual
Financial Statements as set forth in Party A’s Call Report containing
consolidated financial statements certified by independent certified
public accountants and prepared in accordance with generally
accepted
accounting principles in the country in which Party A is
organized
|
Promptly
upon request made by Party B
|
Yes
|
|
|
Party
A
|
Quarterly
Financial Statements as set forth in Party A’s Call Report containing
unaudited, consolidated financial statements of Party A’s fiscal quarter
prepared in accordance with generally accepted accounting principles
in
the country in which Party A is organized
|
Promptly
upon request made by Party B
|
Yes
|
|
|
Party
A
|
An
opinion of counsel to Party A satisfactory in form and substance
to Party
B
|
Upon
the execution and delivery of this Agreement
|
No
|
Part
4. Miscellaneous.
|
(a)
|
Address
for Notices:
For the purposes of Section 12(a) of this
Agreement:
|
Address
for notices or communications to Party A:
|
Address:
|
000
Xxxxx Xxxxxx, Xxx Xxxx, XX 00000
|
|
Attention:
|
Xxxxxxxxx
XxXxxxxx
|
|
Facsimile:
|
000-000-0000
|
|
Telephone:
|
000-000-0000
|
Please
direct all settlement inquiries to:
HSBC
Bank USA, National Association
Derivative
Settlements
|
Attention:
|
Xxxxxxx
Xxxxxxx
|
|
Telephone:
|
(000)
000-0000
|
|
Fax:
|
(000)
000-0000
|
(For
all
purposes)
Address
for notices or communications to Party B:
|
Attention:
|
HSBC
BANK USA, National Association
|
|
000
Xxxxx Xxx.
|
|
|
Xxx
Xxxx, XX 00000
|
|
|
Facsimile:
|
000-000-0000
|
with
a
copy to:
|
Attention:
|
Xxxxx
Fargo Bank, N.A.
|
|
0000
Xxx Xxxxxxxxx Xxxx
|
|
|
Xxxxxxxx,
XX 00000
|
|
|
Attn:
Client Manager, NHEL 2007-2
|
|
|
Facsimile:
|
000-000-0000
|
(For
all
purposes)
(b)
Process
Agent.
For the
purpose of Section 13(c):
Party
A
appoints as its Process Agent: Not applicable.
Party
B
appoints as its Process Agent: Not applicable.
|
(c)
|
Offices.
The provisions of Section 10(a) will apply to this Agreement;
neither
Party A nor Party B has any Offices other than as set forth in
the Notices
Section and Party A agrees that, for purposes of Section 6(b)
of this
Agreement, it shall not in the future have any Office other than
one in
the United States.
|
|
(d)
|
Multibranch
Party.
For the purpose of Section 10(c) of this
Agreement:
|
Party
A
is not a Multibranch Party.
|
Party
B is not a Multibranch Party.
|
|
(e)
|
Calculation
Agent.
The Calculation Agent is Party A; provided, however, that if
an Event of
Default shall have occurred with respect to Party A, Party B
shall have
the right to appoint as Calculation Agent a third party, reasonably
acceptable to Party A, the cost for which shall be borne by Party
A.
|
(f)
Credit
Support Document.
|
Party
A:
|
The
Credit Support Annex, and any guarantee in support of Party A’s
obligations under this Agreement.
|
|
Party
B:
|
The
Credit Support Annex, solely in respect of Party B’s obligations under
Paragraph 3(b) of the Credit Support
Annex.
|
|
(g)
|
Credit
Support Provider.
|
|
Party
A:
|
The
guarantor under any guarantee in support of Party A’s obligations under
this Agreement.
|
|
Party
B:
|
None.
|
|
(h)
|
Governing
Law.
The parties to this Agreement hereby agree that the law of the
State of
New York shall govern their rights and duties in whole, without
regard to
the conflict of law provisions thereof other than New York General
Obligations Law Sections 5-1401 and 5-1402.
|
|
(i)
|
Netting
of Payments.
The parties agree that subparagraph (ii) of Section 2(c) will
apply to
each Transaction hereunder.
|
|
(j)
|
Affiliate.“Affiliate”
shall have the meaning assigned thereto in Section 14; provided,
however,
that Party A and Party B shall be deemed to have no Affiliates
for
purposes of this Agreement, including for purposes of Section
6(b)(ii).
|
Part
5. Others
Provisions.
|
(a)
|
Definitions.
Unless
otherwise specified in a Confirmation, this Agreement and each
Transaction
under this Agreement are subject to the 2000 ISDA Definitions
as published
and copyrighted in 2000 by the International Swaps and Derivatives
Association, Inc. (the “Definitions”),
and will be governed in all relevant respects by the provisions
set forth
in the Definitions, without regard to any amendment to the Definitions
subsequent to the date hereof. The provisions of the Definitions
are
hereby incorporated by reference in and shall be deemed a part
of this
Agreement, except that (i) references in the Definitions to a
“Swap
Transaction” shall be deemed references to a “Transaction” for purposes of
this Agreement, and (ii) references to a “Transaction” in this Agreement
shall be deemed references to a “Swap Transaction” for purposes of the
Definitions. Each term capitalized but not defined in this Agreement
shall
have the meaning assigned thereto in the Pooling and Servicing
Agreement.
|
(b)
Amendments
to ISDA Master Agreement.
|
(i)
|
Single
Agreement.
Section 1(c) is hereby amended by the adding the words “including, for the
avoidance of doubt, the Credit Support Annex” after the words “Master
Agreement”.
|
(ii) Conditions
Precedent. Section
2(a)(iii) is hereby amended by adding the following at the end thereof:
Notwithstanding
anything to the contrary in Section 2(a)(iii)(1), if an Event of Default
with
respect to Party B or Potential Event of Default with respect to Party
B has
occurred and been continuing for more than 30 Local Business Days and no
Early
Termination Date in respect of the Affected Transactions has occurred or
been
effectively designated by Party A, the obligations of Party A under Section
2(a)(i) shall cease to be subject to the condition precedent set forth
in
Section 2(a)(iii)(1) with respect to such specific occurrence of such Event
of
Default or such Potential Event of Default (the “Specific
Event”);
provided, however, for the avoidance of doubt, the obligations of Party
A under
Section 2(a)(i) shall be subject to the condition precedent set forth in
Section
2(a)(iii)(1) (subject to the foregoing) with respect to any subsequent
occurrence of the same Event of Default with respect to Party B or Potential
Event of Default with respect to Party B after the Specific Event has ceased
to
be continuing and with respect to any occurrence of any other Event of
Default
with respect to Party B or Potential Event of Default with respect to Party
B
that occurs subsequent to the Specific Event.
|
(iii)
|
Change
of Account.
Section 2(b) is hereby amended by the addition of the following
after the
word “delivery” in the first line
thereof:
|
“to
another account in the same legal and tax jurisdiction as the original
account”.
|
(iv)
|
Representations.
Section 3 is hereby amended by adding at the end thereof the
following
subsection (g):
|
|
“(g)
|
Relationship
Between Parties.
|
|
(1)
|
Nonreliance.
(i) It is not relying on any statement or representation of the
other
party regarding the Transaction (whether written or oral), other
than the
representations expressly made in this Agreement or the Confirmation
in
respect of that Transaction and (ii) it has consulted with its
own legal,
regulatory, tax, business, investment, financial and accounting
advisors
to the extent it has deemed necessary, and it has made its own
investment,
hedging and trading decisions based upon its own judgment and
upon any
advice from such advisors as it has deemed necessary and not
upon any view
expressed by the other party.
|
|
(2)
|
Evaluation
and Understanding. (i) It has the capacity to evaluate (internally
or
through independent professional advice) the Transaction and
has made its
own decision to enter into the Transaction and (ii) It understands
the
terms, conditions and risks of the Transaction and is willing
and able to
accept those terms and conditions and to assume those risks,
financially
and otherwise.
|
|
(3)
|
Purpose.
It is entering into the Transaction for the purposes of managing
its
borrowings or investments, hedging its underlying assets or liabilities
or
in connection with a line of business.
|
|
(4)
|
Status
of Parties. The other party is not acting as an agent, fiduciary
or
advisor for it in respect of the Transaction.
|
|
(5)
|
Eligible
Contract Participant. It is an “eligible swap participant” as such term is
defined in, Section 35.1(b)(2) of the regulations (17 C.F.R.
35)
promulgated under, and an “eligible contract participant” as defined in
Section 1(a)(12) of the Commodity Exchange Act, as
amended.”
|
|
(v)
|
Transfer
to Avoid Termination Event.
Section 6(b)(ii) is hereby amended by (i) deleting the words
“or if a Tax
Event Upon Merger occurs and the Burdened Party is the Affected
Party,”
and (ii) by deleting the words “to transfer” and inserting the words “to
effect a Permitted Transfer” in lieu
thereof.
|
|
(vi)
|
Jurisdiction.
Section
13(b) is hereby amended by: (i) deleting in the second line of
subparagraph (i) thereof the word "non-", (ii) deleting “; and” from the
end of subparagraph (i) and inserting “.” in lieu thereof, and (iii)
deleting the final paragraph
thereof.
|
|
(vii)
|
Local
Business Day.
The definition of Local Business Day in Section 14 is hereby
amended by
the addition of the words “or any Credit Support Document” after “Section
2(a)(i)” and the addition of the words “or Credit Support Document” after
“Confirmation”.
|
|
(c)
|
Additional
Termination Events.
The following Additional Termination Events will
apply:
|
| (i) |
First
Rating Trigger Collateral.
If
(A) it is not the case that a Xxxxx’x Second Trigger Ratings Event has
occurred and been continuing for 30 or more Local Business Days
and (B)
Party
A has failed to comply with or perform any obligation to be complied
with
or performed by Party A in accordance with the Credit Support Annex,
then
an Additional Termination Event shall have occurred with respect
to Party
A and Party A shall be the sole Affected Party with respect to
such
Additional Termination Event.
|
| (ii) |
Second
Rating Trigger Replacement.
If
(A) a Required Ratings Downgrade Event has occurred and been continuing
for 30 or more Local Business Days and (B) (i) at least one Eligible
Replacement has made a Firm Offer to be the transferee of all of
Party A’s
rights and obligations under this Agreement (and such Firm Offer
remains
an offer that will become legally binding upon such Eligible Replacement
upon acceptance by the offeree) and/or (ii) an Eligible Guarantor
has made
a Firm Offer to provide an Eligible Guarantee (and such Firm Offer
remains
an offer that will become legally binding upon such Eligible Guarantor
immediately upon acceptance by the offeree), then an Additional
Termination Event shall have occurred with respect to Party A and
Party A
shall be the sole Affected Party with respect to such Additional
Termination Event.
|
| (iii) |
Optional
Termination of Securitization.
An
Additional Termination Event shall occur upon the notice to
Certificateholders of an optional termination becoming unrescindable
in
accordance with Article x of the Pooling and Servicing Agreement,
Party B
shall be the sole Affected Party with respect to such Additional
Termination Event; provided, however that notwithstanding anything
to the
contrary in Section 6(b)(iv), only Party B may designate an Early
Termination Date in respect of this Additional Termination Event.
|
| (iv) |
Information
Required by Regulation AB. If
Party A fails to comply with the provisions of Part 5(e) upon the
occurrence of a Swap Disclosure Event, then an Additional Termination
Event shall have occurred with respect to Party A and Party A shall
be the
sole Affected Party with respect to such Additional Termination
Event.
|
|
(d)
|
Required
Ratings Downgrade Event.
In
the event that no Relevant Entity has credit ratings at least
equal to the
Required Ratings Threshold (such event, a “Required
Ratings Downgrade Event”),
then Party A shall, as soon as reasonably practicable and so
long as a
Required Ratings Downgrade Event is in effect, at its own expense,
using
commercially reasonable efforts, procure either (A) a Permitted
Transfer
or (B) an Eligible Guarantee.
|
(e)
Compliance
with Regulation AB. (i)
For
purposes of Item 1115 of Subpart 229.1100 - Asset Backed Securities (Regulation
AB) (17 C.F.R. ss.ss.229.1100 - 229.1123) (“Regulation AB”) under the Securities
Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), as amended and interpreted by the Securities and Exchange
Commission and its staff, if the Depositor or Party B makes a determination,
acting reasonably and in good faith, that (x) the applicable “significance
percentage” with respect to this Agreement has been reached, and (y) it has a
reporting obligation under the Exchange Act (a “Swap Disclosure Event”), then
Party A shall (or shall cause its Credit Support Provider to), within ten
(10)
calendar days after notice to that effect, at its sole expense, take one
of the
following actions: (1) provide (including, if permitted by Regulation AB,
provision by reference to reports filed pursuant to the Exchange Act or
otherwise publicly available information): (A) the financial data required
by
Item 301 of Regulation S-K (17 C.F.R. §229.301), pursuant to Item 1115(b)(1);
(B) financial statements meeting the requirements of Regulation S-X (17
C.F.R.
§§210.1-01 through 210.12-29, but excluding 17 C.F.R. ss. 210.3-05 and Article
11 of Regulation S-X (17 C.F.R. ss. ss. 210.11-01 through 210.11-03)),
pursuant
to Item 1115(b)(2); or (C) such other financial information as may at the
time
be required or permitted to be provided in satisfaction of the requirements
of
Item 1115(b), together with accountants consents and/or a procedure letter
relating thereto; or (2) secure an Approved Replacement that is able to
comply
with the requirements of Item 1115(b) of Regulation AB to replace Party
A as
party to this Agreement, on substantially similar terms, the debt rating
of
which entity (or credit support provider therefor) meets or exceeds the
applicable requirements of the applicable Rating Agencies.
(ii)
For
so long as the aggregate significance percentage is 10% or more, Party
A shall
(or shall cause its Credit Support Provider to) provide any updates to
the
information provided pursuant to clause (i)(1) above to the Depositor within
five (5) Business Days following availability thereof (but in no event
more than
45 days after the end of each of Party A’s Credit Support Provider’s fiscal half
for any half-year update, and in no event more than 90 days after the end
of
each of Party A’s Credit Support Provider’s fiscal year for any annual
update).
(iii)
All
information provided pursuant to clauses (i)(1) and (ii) above (all such
information, “Swap Financial Disclosure”) shall be in a form suitable for
conversion to the format required for filing by the Depositor with the
Commission via the Electronic Data Gathering and Retrieval System (XXXXX).
In
addition, any such information, if audited, shall be accompanied by any
necessary auditor’s consents or, if such information is unaudited, shall be
accompanied by an appropriate agreed-upon procedures letter from Party
A’s
accountants. If permitted by Regulation AB, any such information may be
provided
by reference to or incorporation by reference from reports filed pursuant
to the
Exchange Act.
(iv)
Party A agrees that, in the event that Party A provides Swap Financial
Disclosure to Depositor in accordance with paragraph (iii) above or causes
its
Credit Support Provider to provide Swap Financial Disclosure to Depositor
in
accordance with paragraph (iii) above, it will indemnify and hold harmless
Depositor, its respective directors or officers and any person controlling
Depositor, from and against any and all losses, claims, damages and liabilities
(any “Damage”) caused by any untrue statement or alleged untrue statement of a
material fact contained in such Swap Financial Disclosure or caused by
any
omission or alleged omission to state in such Swap Financial Disclosure
a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading; provided, however that the foregoing shall not apply to any
Damage
caused by the negligence or any willful action of Depositor or any other
party
(other than Party A or any of its affiliates or any of their respective
agents),
including without limitation any failure to calculate the Significance
Percentage according to the terms of this Agreement or to make any filing
as and
when required under Regulation AB.
(v)
Third
Party Beneficiary. The Depositor shall be an express third party beneficiary
of
this Agreement as if a party hereto to the extent of the Depositor’s rights
explicitly specified in this Part 5(e).
|
(f)
|
Transfers.
|
(i) Section
7
is hereby amended to read in its entirety as follows:
“Except
with respect to any Permitted Transfer pursuant to Section 6(b)(ii), Part
5(d),
or the succeeding sentence, neither Party A nor Party B is permitted to
assign,
novate or transfer (whether by way of security or otherwise) as a whole
or in
part any of its rights, obligations or interests under the Agreement or
any
Transaction unless the prior written consent of the other party is obtained.
At
any time at which no Relevant Entity has credit ratings at least equal
to the
Approved Ratings Threshold, Party A may make a Permitted Transfer.”
|
(ii)
|
If
an Eligible Replacement has made a Firm Offer (which remains
an offer that
will become legally binding upon acceptance by Party B) to be
the
transferee pursuant to a Permitted Transfer, Party B shall, at
Party A’s
written request and at Party A’s expense, take any reasonable steps
required to be taken by Party B to effect such transfer.
|
|
(g)
|
Non-Recourse.
Party A acknowledges and agree that, notwithstanding any provision
in this
Agreement to the contrary, the obligations of Party B hereunder
are
limited recourse obligations of Party B, payable solely , in
accordance
with the priority of payments and other terms of the Pooling
and Servicing
Agreement and that Party A will not have any recourse to any
of the
directors, officers, employees, shareholders or affiliates of
the Party B
with respect to any claims, losses, damages, liabilities, indemnities
or
other obligations in connection with any transactions contemplated
hereby.
This provision will survive the termination of this
Agreement.
|
|
(h)
|
Limitation
on Events of Default.
Notwithstanding the provisions of Sections 5 and 6, if at any
time and so
long as Party B has satisfied in full all its payment obligations
under
Section 2(a)(i) and has at the time no future payment obligations,
whether
absolute or contingent, under such Section, then unless Party
A is
required pursuant to appropriate proceedings to return to Party
B or
otherwise returns to Party B upon demand of Party B any portion
of any
such payment, (a) the occurrence of an event described in Section
5(a)
with respect to Party B shall
not constitute an Event of Default or Potential
Event of Default with respect to Party B as Defaulting Party
and (b) Party
A shall be entitled to designate an Early Termination Date pursuant
to
Section 6 only as a result of the occurrence of a Termination
Event set
forth in either Section 5(b)(i) or 5(b)(ii) with respect to Party
A as the
Affected Party, or Section 5(b)(iii) with respect to Party A
as the
Burdened Party. For purposes of the Transaction to which this
Agreement
relates, Party B’s only obligation under Section 2(a)(i) is to pay the
Fixed Amount on the Fixed Amount Payer Payment
Date
|
|
(i)
|
Rating
Agency Notifications. Notwithstanding
any other provision of this Agreement, no Early Termination Date
shall be
effectively designated hereunder by Party B and no transfer of
any rights
or obligations under this Agreement shall be made by either party
unless
each Cap Rating Agency has been given prior written notice of
such
designation or transfer.
|
|
(j)
|
No
Set-off.
Except as expressly provided for in Section 2(c), Section 6 or
Part
1(f)(i)(D) hereof, and notwithstanding any other provision of
this
Agreement or any other existing or future agreement, each party
irrevocably waives any and all rights it may have to set off,
net, recoup
or otherwise withhold or suspend or condition payment or performance
of
any obligation between it and the other party hereunder against
any
obligation between it and the other party under any other agreements.
Section 6(e) shall be amended by deleting the following sentence:
“The
amount, if any, payable in respect of an Early Termination Date
and
determined pursuant to this Section will be subject to any
Set-off.”
|
|
(k)
|
Amendment.
Notwithstanding any provision to the contrary in this Agreement,
no
amendment of either this Agreement or any Transaction under this
Agreement
shall be permitted by either party unless each of the Cap Agencies
has
been provided prior written notice of the
same.
|
|
(l)
|
Notice
of Certain Events or Circumstances.
Each Party agrees, upon learning of the occurrence or existence
of any
event or condition that constitutes (or that with the giving
of notice or
passage of time or both would constitute) an Event of Default
or
Termination Event with respect to such party, promptly to give
the other
Party and to each Cap Rating Agency notice of such event or condition;
provided that failure to provide notice of such event or condition
pursuant to this Part 5(l) shall not constitute an Event of Default
or a
Termination Event.
|
(m)
Proceedings.
No
Relevant Entity shall institute against, or cause any other person to institute
against, or join any other person in instituting against Party B or the
trust
created pursuant to the Pooling and Servicing Agreement, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings or other
proceedings under any federal or state bankruptcy or similar law for a
period of
one year (or, if longer, the applicable preference period) and one day
following
payment in full of the Certificates and any Notes. This provision will
survive
the termination of this Agreement.
|
(n)
|
Supplemental
Interest Trust Trustee Limitation of Liability. It
is expressly understood and agreed by the parties hereto that
(a) this
Agreement is executed and delivered by HSBC Bank USA, National
Association, not individually or personally but solely as the
Supplemental
Interest Trust Trustee, in the exercise of the powers and authority
conferred and vested in it under the Pooling and Servicing Agreement,
(b)
the representations, warranties, covenants, undertakings and
agreements
herein made on the part of the Supplemental Interest Trust are
made and
intended not as personal representations, undertakings and agreements
by
HSBC Bank USA, National Association but are made and intended
for the
purpose of binding only the Supplemental Interest Trust, (c)
nothing
herein contained shall be construed as creating any liability
on HSBC Bank
USA, National Association, individually or personally, to perform
any
covenant either expressed or implied contained herein, all such
liability,
if any, being expressly waived by the parties who are signatories
to this
Agreement and by any person claiming by, through or under such
parties and
(d) under no circumstances shall HSBC Bank USA, National Association
be
personally liable for the payment of any indemnity, indebtedness,
fees or
expenses of the Supplemental Interest Trust or be liable for
the breach or
failure of any obligation, representation, warranty or covenant
made or
undertaken by the Supplemental Interest Trust under this
Agreement.
|
|
(o)
|
Severability.
If
any term, provision, covenant, or condition of this Agreement,
or the
application thereof to any party or circumstance, shall be held
to be
invalid or unenforceable (in whole or in part) in any respect,
the
remaining terms, provisions, covenants, and conditions hereof
shall
continue in full force and effect as if this Agreement had been
executed
with the invalid or unenforceable portion eliminated, so long
as this
Agreement as so modified continues to express, without material
change,
the original intentions of the parties as to the subject matter
of this
Agreement and the deletion of such portion of this Agreement
will not
substantially impair the respective benefits or expectations
of the
parties; provided, however, that this severability provision
shall not be
applicable if any provision of Section 2, 5, 6, or 13 (or any
definition
or provision in Section 14 to the extent it relates to, or is
used in or
in connection with any such Section) shall be so held to be invalid
or
unenforceable.
|
The
parties shall endeavor to engage in good faith negotiations to replace
any
invalid or unenforceable term, provision, covenant or condition with a
valid or
enforceable term, provision, covenant or condition, the economic effect
of which
comes as close as possible to that of the invalid or unenforceable term,
provision, covenant or condition.
|
(p)
|
Agent
for Party B. Party
A acknowledges that the Securities Administrator has been appointed
as
agent under the Pooling and Servicing Agreement to carry out
certain
functions on behalf of Party B, and that the Securities Administrator
shall be entitled to give notices and to perform and satisfy
the
obligations of Party B hereunder on behalf of Party
B.
|
|
(q)
|
Escrow
Payments.
If
(whether by reason of the time difference between the cities
in which
payments are to be made or otherwise) it is not possible for
simultaneous
payments to be made on any date on which both parties are required
to make
payments hereunder, either Party may at its option and in its
sole
discretion notify the other Party that payments on that date
are to be
made in escrow. In this case deposit of the payment due earlier
on that
date shall be made by 2:00 pm (local time at the place for the
earlier
payment) on that date with an escrow agent selected by the notifying
party, accompanied by irrevocable payment instructions (i) to
release the
deposited payment to the intended recipient upon receipt by the
escrow
agent of the required deposit of any corresponding payment payable
by the
other party on the same date accompanied by irrevocable payment
instructions to the same effect or (ii) if the required deposit
of the
corresponding payment is not made on that same date, to return
the payment
deposited to the party that paid it into escrow. The party that
elects to
have payments made in escrow shall pay all costs of the escrow
arrangements.
|
|
(r)
|
Consent
to Recording.
Each party hereto consents to the monitoring or recording, at
any time and
from time to time, by the other party of any and all communications
between trading, marketing, and operations personnel of the parties
and
their Affiliates, waives any further notice of such monitoring
or
recording, and agrees to notify such personnel of such monitoring
or
recording.
|
|
(s)
|
Waiver
of Jury Trial.
Each party waives any right it may have to a trial by jury in
respect of
any in respect of any suit, action or proceeding relating to
this
Agreement or any Credit Support Document.
|
|
(t)
|
Form
of ISDA Master Agreement. Party
A and Party B hereby agree that the text of the body of the ISDA
Master
Agreement is intended to be the printed form of the ISDA Master
Agreement
(Multicurrency - Crossborder) as published and copyrighted in
1992 by the
International Swaps and Derivatives Association,
Inc.
|
|
(u)
|
Payment
Instructions.
Party A hereby agrees that, unless notified in writing by Party
B of other
payment instructions, any and all amounts payable by Party A
to Party B
under this Agreement shall be paid to the account specified in
Item 4 of
this Confirmation, below.
|
|
(v)
|
Additional
representations.
|
|
(i)
|
Representations
of Party A.
Party A represents to Party B on the date on which Party A enters
into
each Transaction that:--
|
|
(1)
|
Party
A’s obligations under this Agreement rank pari passu with all of
Party A’s
other unsecured, unsubordinated obligations except those obligations
preferred by operation of law.
|
|
(2)
|
Party
A is a bank subject to the requirements of 12 U.S.C. § 1823(e), its
execution, delivery and performance of this Agreement (including
the
Credit Support Annex and each Confirmation) have been approved
by its
board of directors or its loan committee, such approval is reflected
in
the minutes of said board of directors or loan committee, and
this
Agreement (including the Credit Support Annex and each Confirmation)
will
be maintained as one of its official records continuously from
the time of
its execution (or in the case of any Confirmation, continuously
until such
time as the relevant Transaction matures and the obligations
therefor are
satisfied in full).
|
|
(ii)
|
Capacity.
Party A represents to Party B on the date on which Party A enters
into
this Agreement that it is entering into the Agreement and the
Transaction
as principal and not as agent of any person. The Supplemental
Interest
Trust Trustee represents to Party A on the date on which the
Supplemental
Interest Trust Trustee executes this Agreement that it is executing
the
Agreement in its capacity as Supplemental Interest Trust
Trustee.
|
|
(w)
|
Acknowledgements.
|
|
(ii)
|
Bankruptcy
Code.
Subject to Part 5(m), without limiting the applicability if any,
of any
other provision of the U.S. Bankruptcy Code as amended (the “Bankruptcy
Code”) (including without limitation Sections 362, 546, 556, and 560
thereof and the applicable definitions in Section 101 thereof),
the
parties acknowledge and agree that all Transactions entered into
hereunder
will constitute “forward contracts” or “swap agreements” as defined in
Section 101 of the Bankruptcy Code or “commodity contracts” as defined in
Section 761 of the Bankruptcy Code, that the rights of the parties
under
Section 6 of this Agreement will constitute contractual rights
to
liquidate Transactions, that any margin or collateral provided
under any
margin, collateral, security, pledge, or similar agreement related
hereto
will constitute a “margin payment” as defined in Section 101 of the
Bankruptcy Code, and that the parties are entities entitled to
the rights
under, and protections afforded by, Sections 362, 546, 556, and
560 of the
Bankruptcy Code.
|
| (x) |
[Reserved]
|
| (y) |
Third
Party Beneficiary.
Xxxxx Fargo Bank, N.A. is a third party beneficiary of this agreement
and
is entitled to the rights and benefits hereunder and may enforce
the
provisions hereof as if were a party
hereto.
|
(z)
Additional
Definitions.
As
used
in this Agreement, the following terms shall have the meanings set forth
below,
unless the context clearly requires otherwise:
“Approved
Ratings Threshold”
means
each of the S&P Approved Ratings Threshold, the Xxxxx’x First Trigger
Ratings Threshold and the DBRS Approved Ratings Threshold.
“Approved
Replacement” means,
with respect to a Market Quotation, an entity making such Market Quotation,
which entity would satisfy conditions (a), (b), (c) and (d) of the definition
of
Permitted Transfer (as determined by Party B in its sole discretion, acting
in a
commercially reasonable manner) if such entity were a Transferee, as defined
in
the definition of Permitted Transfer.
“Cap
Rating Agencies”
means,
with respect to any date of determination, each of Moody’s, DBRS and
S&P,
to the
extent that each such rating agency is then providing a rating for any
of the
Nomura
Home Equity Loan, Inc., Home Equity Loan Trust, Series 2007-2 (the
“Certificates”) or any notes backed by the Certificates (the
“Notes”).
“DBRS”
means
Dominion Bond Rating Service, or any successor thereto.
“DBRS
Approved Ratings Threshold” means,
with respect to Party A, the guarantor under an Eligible Guarantee, or
an
Eligible Replacement, a long-term unsecured and unsubordinated debt rating
from
DBRS of “AA(low)” and a short-term unsecured and unsubordinated debt rating from
DBRS of “R-1(middle)”.
“DBRS
Required Ratings Threshold” means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, a long-term unsecured and unsubordinated debt rating
from
DBRS of “BBB”.
“Derivative
Provider Trigger Event”
means
(i) an Event of Default with respect to which Party A is a Defaulting Party,
(ii) a Termination Event with respect to which Party A is the sole Affected
Party or (iii) an Additional Termination Event with respect to which Party
A is
the sole Affected Party.
“Eligible
Guarantee”
means an
unconditional and irrevocable guarantee of all present and future obligations
(for the avoidance of doubt, not limited to payment obligations) of Party
A or
an Eligible Replacement to Party B under this Agreement that is provided
by an
Eligible Guarantor as principal debtor rather than surety and that is directly
enforceable by Party B, and either (A) a law firm has given a legal opinion
confirming that none of the guarantor’s payments to Party B under such guarantee
will be subject to Tax
collected by withholding or
(B)
such guarantee provides that, in the event that any of such guarantor’s payments
to Party B are subject to Tax collected by withholding, such guarantor
is
required to pay such additional amount as is necessary to ensure that the
net
amount actually received by Party B (free and clear of any Tax collected
by
withholding) will equal the full amount Party B would have received had
no such
withholding been required.
“Eligible
Guarantor” means
an
entity that (A) has credit ratings at least equal to the S&P Approved
Ratings Threshold and the DBRS
Approved Ratings Threshold and (B) has credit ratings from Moody’s at least
equal to the Moody’s Second Trigger Ratings Threshold, provided, for the
avoidance of doubt, that an Eligible Guarantee of an Eligible Guarantor
with
credit ratings below the Moody’s First Trigger Ratings Threshold will not cause
a Collateral Event (as defined in the Credit Support Annex) not to occur
or
continue with respect to Moody’s.
“Eligible
Replacement”
means an
entity (i) (a) that has credit ratings at least equal to the S&P Approved
Ratings Threshold and the DBRS
Approved Ratings Threshold, and (b) has credit ratings from Moody’s at least
equal to the Moody’s Second Trigger Ratings Threshold, provided, for the
avoidance of doubt, that an Eligible Replacement with credit ratings below
the
Moody’s First Trigger Ratings Threshold will not cause a Collateral Event (as
defined in the Credit Support Annex) not to occur or continue with respect
to
Moody’s, or (ii) the present and future obligations (for the avoidance of doubt,
not limited to payment obligations) of which entity to Party B under this
Agreement are guaranteed pursuant to an Eligible Guarantee.
“Firm
Offer”
means
(A) with respect to an Eligible Replacement, a quotation from such Eligible
Replacement (i) in an amount equal to the actual amount payable by or to
Party B
in consideration of an agreement between Party B and such Eligible Replacement
to replace Party A as the counterparty to this Agreement by way of novation
or,
if such novation is not possible, an agreement between Party B and such
Eligible
Replacement to enter into a Replacement Transaction (assuming that all
Transactions hereunder become Terminated Transactions), and (ii) that
constitutes an offer by such Eligible Replacement to replace Party A as
the
counterparty to this Agreement or enter a Replacement Transaction that
will
become legally binding upon such Eligible Replacement upon acceptance by
Party
B, and (B) with respect to an Eligible Guarantor, an offer by such Eligible
Guarantor to provide an Eligible Guarantee that will become legally binding
upon
such Eligible Guarantor upon acceptance by the offeree.
“Moody’s”
means
Xxxxx’x Investors Service, Inc., or any successor thereto.
“Moody’s
Second Trigger Ratings Event”
means
that no Relevant Entity has credit ratings from Moody’s at least equal to the
Moody’s Second Trigger Ratings Threshold.
“Permitted
Transfer” means
a
transfer by novation by Party A pursuant to Section 6(b)(ii), Part 5(d),
or the
second sentence of Section 7 (as amended herein) to a transferee (the
“Transferee”)
of all,
but not less than all, of Party A’s rights, liabilities, duties and obligations
under this Agreement, with
respect to which transfer each of the following conditions is
satisfied:
(a) the
Transferee is an Eligible Replacement; (b) Party A and the Transferee are
both
“dealers in notional principal contracts” within the meaning of Treasury
regulations section 1.1001-4; (c) as of the date of such transfer the Transferee
would not be required to withhold or deduct on account of Tax from any
payments
under this Agreement or would be required to gross up for such Tax under
Section
2(d)(i)(4); (d) an Event of Default or Termination Event would not occur
as a
result of such transfer; (e) pursuant to a written instrument (the “Transfer
Agreement”),
the
Transferee acquires and assumes all rights and obligations of Party A under
the
Agreement and the relevant Transaction; (f) Party B shall have determined,
in
its sole discretion, acting in a commercially reasonable manner, that such
Transfer Agreement is effective to transfer to the Transferee all, but
not less
than all, of Party A’s rights and obligations under the Agreement and all
relevant Transactions; (g) Party A will be responsible for any costs or
expenses
incurred in connection with such transfer (including any replacement cost
of
entering into a replacement transaction); (h) either (A) Xxxxx’x and S&P
have been given prior written notice of such transfer or (B) each Swap
Rating
Agency has been given prior written notice of such transfer and such transfer
is
in connection with the assignment and assumption of this Agreement without
modification of its terms, other than party names, dates relevant to the
effective date of such transfer, tax representations (provided that the
representations in Part 2(a)(i) are not modified) and any other representations
regarding the status of the substitute counterparty of the type included
in Part
5(b)(iv), Part 5(v)(i)(2) or Part 5(v)(ii), notice information and account
details; and such transfer otherwise complies with the terms of the Pooling
and
Servicing Agreement.
“Relevant
Entity” means
Party A and, to the extent applicable, a guarantor under an Eligible
Guarantee.
“Replacement
Transaction”
means,
with respect to any Terminated Transaction or group of Terminated Transactions,
a transaction or group of transactions that (i) would have the effect of
preserving for Party B the economic equivalent of any payment or delivery
(whether the underlying obligation was absolute or contingent and assuming
the
satisfaction of each applicable condition precedent) by the parties under
Section 2(a)(i) in respect of such Terminated Transaction or group of Terminated
Transactions that would, but for the occurrence of the relevant Early
Termination Date, have been required after that Date, and (ii) has terms
which
are substantially the same as this Agreement, including, without limitation,
rating triggers, Regulation AB compliance, and credit support documentation,
save for the exclusion of provisions relating to Transactions that are
not
Terminated Transaction, as determined by Party B in its sole discretion,
acting
in a commercially reasonable manner.
“Required
Ratings Downgrade Event”
shall
have the meaning assigned thereto in Part 5(d).
“Required
Ratings Threshold” means
each of the S&P Required Ratings Threshold, the Xxxxx’x Second Trigger
Ratings Threshold and the DBRS Required Ratings Threshold.
“S&P”
means
Standard & Poor's Rating Services, a division of The XxXxxx-Xxxx Companies,
Inc., or any successor thereto.
“S&P
Required Ratings Threshold”
means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, a long-term unsecured and unsubordinated debt rating
from
S&P of “BBB+”.
[Remainder
of this page intentionally left blank.]
4. Account
Details and Settlement Information:
|
Payments
to Party A:
|
HSBC
Bank USA, National Association
|
|
ABA
# 000-000-000
|
|
|
For
credit to Department 299
|
|
|
A/C:
000-00000-0
|
|
|
HSBC
Derivative Products Group
|
|
|
Payments
to Party B:
|
Xxxxx
Fargo Bank, N.A.
|
|
ABA
# 000-000-000
|
|
|
For
Credit to: SAS Clearing
|
|
|
A/C:
0000000000
|
|
|
FFC:
NHEL 2007-2, Supplemental Interest Trust,
#50984601
|
This
Agreement may be executed in several counterparts, each of which shall
be deemed
an original but all of which together shall constitute one and the same
instrument.
We
are
very pleased to have executed this Transaction with you and we look forward
to
completing other transactions with you in the near future.
Very
truly yours,
HSBC
BANK
USA, NATIONAL ASSOCIATION
|
By:
|
/s/
Xxxxxxx Xxxxxxxx
|
|
Name:
|
Xxxxxxx
Xxxxxxxx
|
|
Title:
|
Assistant
Vice President
|
|
By:
|
/s/
Xxxxxxxx Xxxxxxx
|
|
Name:
|
Xxxxxxxx
Xxxxxxx
|
|
Title:
|
Vice
President
|
Party
B,
acting through its duly authorized signatory, hereby agrees to, accepts
and
confirms the terms of the foregoing as of the date hereof.
HSBC
BANK
USA, NATIONAL ASSOCIATION, NOT INDIVIDUALLY, BUT SOLELY AS SUPPLEMENTAL
INTEREST
TRUST TRUSTEE ON BEHALF OF THE SUPPLEMENTAL INTEREST TRUST WITH RESPECT
TO THE
NOMURA HOME EQUITY LOAN, INC., HOME EQUITY LOAN TRUST, SERIES
2007-2
|
By:
|
/s/
Xxxxx Xxxxx
|
|
Name:
|
Xxxxx
Xxxxx
|
|
Title:
|
Assistant
Vice President
|
SCHEDULE
I
(all
such
dates subject to adjustment in accordance with the Following Business Day
Convention)
|
For
the Calculation Periods
|
Calculation
Amount
|
Cap
Rate
|
|
|
From
and including:
|
To
but excluding:
|
in
USD:
|
|
|
The
Effective Date
|
February
25, 2007
|
895,725,000.00
|
9.368380%
|
|
February
25, 2007
|
March
25, 2007
|
881,160,477.00
|
8.364660%
|
|
March
25, 2007
|
April
25, 2007
|
865,176,776.00
|
7.555210%
|
|
April
25, 2007
|
May
25, 2007
|
847,828,485.00
|
7.807070%
|
|
May
25, 2007
|
June
25, 2007
|
829,176,277.00
|
7.555250%
|
|
June
25, 2007
|
The
Termination Date
|
809,310,194.00
|
7.807140%
|
Annex
A
Paragraph
13 of the Credit Support Annex
ANNEX
A
ISDA®
CREDIT
SUPPORT ANNEX
to
the
Schedule to the
ISDA
Master Agreement
dated
as
of January 31, 2007 between
HSBC
Bank
USA, National Association (hereinafter referred to as “Party
A”
or
“Pledgor”)
and
HSBC
Bank
USA, National Association, not individually, but solely as Supplemental Interest
Trust Trustee on behalf of the Supplemental Interest Trust with respect to
the
Nomura Home Equity Loan, Inc., Home Equity Loan Trust, Series 2007-2
(hereinafter referred to as “Party
B”
or
“Secured
Party”).
For
the
avoidance of doubt, and notwithstanding anything to the contrary that may
be
contained in the Agreement, this Credit Support Annex shall relate solely
to the
Transaction documented in the Confirmation dated January 31, 2007 between
Party
A and Party B, Reference Number 453997HN/453998HN.
Paragraph
13. Elections and Variables.
| (a) |
Security
Interest for “Obligations”.
The term “Obligations”
as
used in this Annex includes the following additional
obligations:
|
With
respect to Party A: not applicable.
With
respect to Party B: not applicable.
| (b) |
Credit
Support Obligations.
|
| (i) |
Delivery
Amount, Return Amount and Credit Support
Amount.
|
| (A) |
“Delivery
Amount”
has the meaning specified in Paragraph 3(a) as amended (I) by deleting
the
words “upon a demand made by the Secured Party on or promptly following
a
Valuation Date” and inserting in lieu thereof the words “not later than
the close of business on each Valuation Date” and (II) by deleting in its
entirety the sentence beginning “Unless otherwise specified in Paragraph
13” and ending “(ii) the Value as of that Valuation Date of all Posted
Credit Support held by the Secured Party.” and inserting in lieu thereof
the following:
|
The
“Delivery
Amount”
applicable to the Pledgor for any Valuation Date will equal the greatest
of
|
(1)
|
the
amount by which (a) the S&P/DBRS Credit Support Amount for such
Valuation Date exceeds (b) the S&P/DBRS Value as of such Valuation
Date of all Posted Credit Support held by the Secured Party,
|
|
(2)
|
the
amount by which (a) the Xxxxx’x First Trigger Credit Support Amount for
such Valuation Date exceeds (b) the Xxxxx’x First Trigger Value as of such
Valuation Date of all Posted Credit Support held by the Secured
Party,
and
|
|
(3)
|
the
amount by which (a) the Xxxxx’x Second Trigger Credit Support Amount for
such Valuation Date exceeds (b) the Xxxxx’x Second Trigger Value as of
such Valuation Date of all Posted Credit Support held by the Secured
Party.
|
| (B) |
“Return
Amount”
has the meaning specified in Paragraph 3(b) as amended by deleting
in its
entirety the sentence beginning “Unless otherwise specified in Paragraph
13” and ending “(ii) the Credit Support Amount.” and inserting in lieu
thereof the following:
|
The
“Return
Amount”
applicable to the Secured Party for any Valuation Date will equal the least
of
|
(1)
|
the
amount by which (a) the S&P/DBRS Value as of such Valuation Date of
all Posted Credit Support held by the Secured Party exceeds (b)
the
S&P/DBRS Credit Support Amount for such Valuation Date,
|
|
(2)
|
the
amount by which (a) the Xxxxx’x First Trigger Value as of such Valuation
Date of all Posted Credit Support held by the Secured Party exceeds
(b)
the Xxxxx’x First Trigger Credit Support Amount for such Valuation Date,
and
|
|
(3)
|
the
amount by which (a) the Xxxxx’x Second Trigger Value as of such Valuation
Date of all Posted Credit Support held by the Secured Party exceeds
(b)
the Xxxxx’x Second Trigger Credit Support Amount for such Valuation
Date.
|
| (C) |
“Credit
Support Amount”
shall not apply. For purposes of calculating any Delivery Amount
or Return
Amount for any Valuation Date, reference shall be made to the S&P/DBRS
Credit Support Amount, the Xxxxx’x First Trigger Credit Support Amount, or
the Xxxxx’x Second Trigger Credit Support Amount, in each case for such
Valuation Date, as provided in Paragraphs 13(b)(i)(A) and 13(b)(i)(B),
above.
|
| (ii) |
Eligible
Collateral.
|
On
any
date, the items set forth in Schedule I will qualify as “Eligible
Collateral”
(for
the avoidance of doubt, all Eligible Collateral to be denominated in
USD).
| (iii) |
Other
Eligible Support.
|
The
following items will qualify as “Other
Eligible Support”
for the
party specified:
Not
applicable.
| (iv) |
Threshold.
|
| (A) |
“Independent
Amount”
means zero with respect to Party A and Party
B.
|
| (B) |
“Threshold”
means, with respect to Party A and any Valuation Date, zero if (i)
a
Collateral Event has occurred and has been continuing (x) for at
least 30
days or (y) since this Annex was executed, or (ii) a Required Ratings
Downgrade Event has occurred and is continuing; otherwise,
infinity.
|
“Threshold”
means,
with respect to Party B and any Valuation Date, infinity.
| (C) |
“Minimum
Transfer Amount” means
USD 50,000 with respect to Party A and Party
B.
|
| (D) |
Rounding:
The Delivery Amount will be rounded up to the nearest integral multiple
of
USD 10,000. The Return Amount will be rounded down to the nearest
integral
multiple of USD 10,000.
|
| (c) |
Valuation
and Timing.
|
| (i) |
“Valuation
Agent”
means Party A; provided, however, that if an Event of Default shall
have
occurred with respect to which Party A is the Defaulting Party, Party
B
shall have the right to designate as Valuation Agent an independent
party,
reasonably acceptable to Party A, the cost for which shall be borne
by
Party A. All calculations by the Valuation Agent must be made in
accordance with standard market practice, including, in the event
of a
dispute as to the Value of any Eligible Credit Support or Posted
Credit
Support, by making reference to quotations received by the Valuation
Agent
from one or more Pricing Sources.
|
| (ii) |
“Valuation
Date” means
each Local Business Day on which any of the S&P/DBRS Credit Support
Amount, the Xxxxx’x First Trigger Credit Support Amount or the Xxxxx’x
Second Trigger Credit Support Amount is greater than
zero.
|
| (iii) |
“Valuation
Time” means
the close of business in the city of the Valuation Agent on the Local
Business Day immediately preceding the Valuation Date or date of
calculation, as applicable; provided
that the calculations of Value and Exposure will be made as of
approximately the same time on the same date. The Valuation Agent
will
notify each party (or the other party, if the Valuation Agent is
a party)
of its calculations not later than the Notification Time on the applicable
Valuation Date (or in the case of Paragraph 6(d), the Local Business
Day
following the day on which such relevant calculations are
performed).”
|
| (iv) |
“Notification
Time” means
11:00 a.m., New York time, on a Local Business Day.
|
| (v) |
External
Verification.
Notwithstanding anything to the contrary in the definitions of Valuation
Agent or Valuation Date, at any time at which Party A (or, to the
extent
applicable, its Credit Support Provider) does not have a long-term
unsubordinated and unsecured debt rating of at least “BBB+” from S&P,
the Valuation Agent shall (A) calculate the Secured Party’s Exposure and
the S&P/DBRS Value of Posted Credit Suppport on each Valuation Date
based on internal marks and (B) verify such calculations with external
marks monthly by obtaining on the last Local Business Day of each
calendar
month two external marks for each Transaction to which this Annex
relates
and for all Posted Credit Suport; such verification of the Secured
Party’s
Exposure shall be based on the higher of the two external marks.
Each
external xxxx in respect of a Transaction shall be obtained from
an
independent Reference Market-maker that would be eligible and willing
to
enter into such Transaction in the absence of the current derivative
provider, provided that an external xxxx xxx not be obtained from
the same
Reference Market-maker more than four times in any 12-month period.
The
Valuation Agent shall obtain these external marks directly or through
an
independent third party, in either case at no cost to Party B. The
Valuation Agent shall calculate on each Valuation Date (for purposes
of
this paragraph, the last Local Business Day in each calendar month
referred to above shall be considered a Valuation Date) the Secured
Party’s Exposure based on the greater of the Valuation Agent’s internal
marks and the external marks received. If the S&P/DBRS Value on any
such Valuation Date of all Posted Credit Support then held by the
Secured
Party is less than the S&P/DBRS Credit Support Amount on such
Valuation Date (in each case as determined pursuant to this paragraph),
Party A shall, within three Local Business Days of such Valuation
Date,
Transfer to the Secured Party Eligible Credit Support having an
S&P/DBRS Value as of the date of Transfer at least equal to such
deficiency.
|
| (vi) |
Notice
to S&P.
At
any time at which Party A (or, to the extent applicable, its Credit
Support Provider) does not have a long-term unsubordinated and unsecured
debt rating of at least “BBB+” from S&P, the Valuation Agent shall
provide to S&P not later than the Notification Time on the Local
Business Day following each Valuation Date its calculations of the
Secured
Party’s Exposure and the S&P/DBRS Value of any Eligible Credit Support
or Posted Credit Support for that Valuation Date. The Valuation Agent
shall also provide to S&P any external marks received pursuant to the
preceding paragraph.
|
| (d) |
Conditions
Precedent and Secured Party’s Rights and
Remedies.
The following Termination Events will be a “Specified
Condition”
for the party specified (that party being the Affected Party if the
Termination Event occurs with respect to that party): With respect
to
Party A: any Additional Termination Event with respect to which Party
A is
the sole Affected Party. With respect to Party B:
None.
|
| (e) |
Substitution.
|
| (i) |
“Substitution
Date”
has the meaning specified in Paragraph
4(d)(ii).
|
| (ii) |
Consent.
If
specified here as applicable, then the Pledgor must obtain the Secured
Party’s consent for any substitution pursuant to Paragraph 4(d):
Inapplicable.
|
| (f) |
Dispute
Resolution.
|
| (i) |
“Resolution
Time”
means 1:00 p.m. New York time on the Local Business Day following
the date
on which the notice of the dispute is given under Paragraph
5.
|
| (ii) |
Value.
Notwithstanding anything to the contrary in Paragraph 12, for the
purpose
of Paragraphs 5(i)(C) and 5(ii), the S&P/DBRS Value, Xxxxx’x First
Trigger Value, and Xxxxx’x Second Trigger Value, on any date, of Eligible
Collateral other than Cash will be calculated as follows:
|
For
Eligible Collateral in the form of securities listed in Paragraph 13(b)(ii):
the
sum of (A) the product of (1)(x) the bid price at the Valuation Time for
such
securities on the principal national securities exchange on which such
securities are listed, or (y) if such securities are not listed on a national
securities exchange, the bid price for such securities quoted at the Valuation
Time by any principal market maker for such securities selected by the Valuation
Agent, or (z) if no such bid price is listed or quoted for such date, the
bid
price listed or quoted (as the case may be) at the Valuation Time for the
day
next preceding such date on which such prices were available and (2) the
applicable Valuation Percentage for such Eligible Collateral, and (B) the
accrued interest on such securities (except to the extent Transferred to
the
Pledgor pursuant to Paragraph 6(d)(ii) or included in the applicable price
referred to in the immediately preceding clause (A)) as of such
date.
| (iii) |
Alternative.
The provisions of Paragraph 5 will apply.
|
| (g) |
Holding
and Using Posted
Collateral.
|
| (i) |
Eligibility
to Hold Posted Collateral; Custodians. Party
B (or any Custodian) will be entitled to hold Posted Collateral pursuant
to Paragraph 6(b).
|
Party
B
may appoint as Custodian (A) the entity then serving as Securities Administrator
or (B) any entity other than the entity then serving as Securities Administrator
if such other entity (or, to the extent applicable, its parent company or
credit
support provider) shall then have a short-term unsecured and unsubordinated
debt
rating from S&P of at least “A-1.”
Initially,
the Custodian
for
Party B is: Securities Administrator.
| (ii) |
Use
of Posted Collateral. The
provisions of Paragraph 6(c)(i) will not apply to Party B, but the
provisions of Paragraph 6(c)(ii) will apply to Party B.
|
| (h) |
Distributions
and Interest Amount.
|
| (i) |
Interest
Rate.
The “Interest
Rate”
will be the actual interest rate earned on Posted Collateral in the
form
of Cash that is held by Party B or its Custodian. Posted Collateral
in the
form of Cash shall be invested in such overnight (or redeemable within
two
Local Business Days of demand) Permitted Investments rated at least
(x)
AAAm or AAAm-G by S&P and (y) Prime-1 by Xxxxx’x or Aaa by Xxxxx’x, as
directed by Party A (unless (x) an Event of Default or an Additional
Termination Event has occurred with respect to which Party A is the
defaulting or sole Affected Party or (y) an Early Termination Date
has
been designated, in which case such investment shall be held uninvested).
Gains and losses incurred in respect of any investment of Posted
Collateral in the form of Cash in Permitted Investments as directed
by
Party A shall be for the account of Party
A.
|
| (ii) |
Transfer
of Interest Amount.
The Transfer of the Interest Amount will be made on the second Local
Business Day following the end of each calendar month and on any
other
Local Business Day on which Posted Collateral in the form of Cash
is
Transferred to the Pledgor pursuant to Paragraph 3(b); provided,
however,
that the obligation of Party B to Transfer any Interest Amount to
Party A
shall be limited to the extent that Party B has earned and received
such
funds and such funds are available to Party B.
|
| (iii) |
Alternative
to Interest Amount.
The provisions of Paragraph 6(d)(ii) will
apply.
|
| (i) |
Additional
Representation(s).
There are no additional representations by either
party.
|
| (j) |
Other
Eligible Support and Other Posted Support.
|
| (i) |
“Value”
with respect to Other Eligible Support and Other Posted Support means:
not
applicable.
|
| (ii) |
“Transfer”
with respect to Other Eligible Support and Other Posted Support means:
not
applicable.
|
| (k) |
Demands
and Notices.All
demands, specifications and notices under this Annex will be made
pursuant
to the Notices Section of this Agreement, except that any demand,
specification or notice shall be given to or made at the following
addresses, or at such other address as the relevant party may from
time to
time designate by giving notice (in accordance with the terms of
this
paragraph) to the other party:
|
If
to
Party A, at the address specified pursuant to the Notices Section of this
Agreement.
If
to
Party B, at the address specified pursuant to the Notices Section of this
Agreement.
If
to
Party B’s Custodian:
Xxxxx
Fargo Bank, N.A.
0000
Xxx
Xxxxxxxxx Xxxx
Xxxxxxxx,
Xxxxxxxx 00000
Attn:
Client Manager - NHEL 2007-2
Tel:
000-000-0000
Fax:
000-000-0000
| (l) |
Address
for Transfers.
Each Transfer hereunder shall be made to the address specified below
or to
an address specified in writing from time to time by the party to
which
such Transfer will be made.
|
Party
A
account details for holding collateral:
HSBC
Bank
USA, National Association
ABA
#
000-000-000
For
credit to Department 299
A/C:
000-00000-0
HSBC
Derivative Products Group
Party
B’s
Custodian account details for holding collateral
Xxxxx
Fargo Bank, N.A.
ABA
#
000-000-000
For
Credit to: SAS Clearing
A/C:
0000000000
FFC:
NHEL 2007-2, Posted Collateral Account, # 00000000
| (m) |
Other
Provisions.
|
| (i) |
Collateral
Account.
Party B shall open and maintain a segregated account, which shall
be an
Eligible Account, and hold, record and identify all Posted Collateral
in
such segregated account.
|
| (ii) |
Agreement
as to Single Secured Party and Single Pledgor.
Party A and Party B hereby agree that, notwithstanding anything to
the
contrary in this Annex, (a) the term “Secured Party” as used in this Annex
means only Party B, (b) the term “Pledgor” as used in this Annex means
only Party A, (c) only Party A makes the pledge and grant in Paragraph
2,
the acknowledgement in the final sentence of Paragraph 8(a) and the
representations in Paragraph 9.
|
| (iii) |
Calculation
of Value.
Paragraph 4(c) is hereby amended by deleting the word “Value” and
inserting in lieu thereof “S&P/DBRS Value, Xxxxx’x First Trigger
Value, Xxxxx’x Second Trigger Value”. Paragraph 4(d)(ii) is hereby amended
by (A) deleting the words “a Value” and inserting in lieu thereof “an
S&P/DBRS Value, Xxxxx’x First Trigger Value, and Xxxxx’x Second
Trigger Value” and (B) deleting the words “the Value” and inserting in
lieu thereof “S&P/DBRS Value, Xxxxx’x First Trigger Value, and Xxxxx’x
Second Trigger Value”. Paragraph 5 (flush language) is hereby amended by
deleting the word “Value” and inserting in lieu thereof “S&P/DBRS
Value, Xxxxx’x First Trigger Value, or Xxxxx’x Second Trigger Value”.
Paragraph 5(i) (flush language) is hereby amended by deleting the
word
“Value” and inserting in lieu thereof “S&P/DBRS Value, Xxxxx’x First
Trigger Value, and Xxxxx’x Second Trigger Value”. Paragraph 5(i)(C) is
hereby amended by deleting the word “the Value, if” and inserting in lieu
thereof “any one or more of the S&P/DBRS Value, Xxxxx’x First Trigger
Value, or Xxxxx’x Second Trigger Value, as may be”. Paragraph 5(ii) is
hereby amended by (1) deleting the first instance of the words “the Value”
and inserting in lieu thereof “any one or more of the S&P/DBRS Value,
Xxxxx’x First Trigger Value, or Xxxxx’x Second Trigger Value” and (2)
deleting the second instance of the words “the Value” and inserting in
lieu thereof “such disputed S&P/DBRS Value, Xxxxx’x First Trigger
Value, or Xxxxx’x Second Trigger Value”. Each of Paragraph 8(b)(iv)(B) and
Paragraph 11(a) is hereby amended by deleting the word “Value” and
inserting in lieu thereof “least of the S&P/DBRS Value, Xxxxx’x First
Trigger Value, and Xxxxx’x Second Trigger Value”.
|
| (iv) |
Form
of Annex. Party
A and Party B hereby agree that the text of Paragraphs 1 through
12,
inclusive, of this Annex is intended to be the printed form of ISDA
Credit
Support Annex (Bilateral Form - ISDA Agreements Subject to New York
Law
Only version) as published and copyrighted in 1994 by the International
Swaps and Derivatives Association, Inc.
|
| (v) |
Events
of Default.
Paragraph 7 will not apply to cause any Event of Default to exist
with
respect to Party B except that Paragraph 7(i) will apply to Party
B solely
in respect of Party B’s obligations under Paragraph 3(b) of the Credit
Support Annex. Notwithstanding anything to the contrary in Paragraph
7,
any failure by Party A to comply with or perform any obligation to
be
complied with or performed by Party A under the Credit Support Annex
shall
only be an Event of Default if (A) a
S&P Required Ratings Downgrade Event has occurred and been continuing
for 30 or more Local Business Days, and (B) such failure is not remedied
on or before the third Local Business Day after notice of such failure
is
given to Party A.
|
| (vi) |
Expenses.
Notwithstanding anything to the contrary in Paragraph 10, the Pledgor
will
be responsible for, and will reimburse the Secured Party for, all
transfer
and other taxes and other costs involved in any Transfer of Eligible
Collateral.
|
| (vii) |
Withholding.
Paragraph 6(d)(ii) is hereby amended by inserting immediately after
“the
Interest Amount” in the fourth line thereof the words “less any applicable
withholding taxes.”
|
| (ix) |
Additional
Definitions.
As used in this Annex:
|
“Collateral
Event” means
that no Relevant Entity has credit ratings at least equal to the Approved
Ratings Threshold.
“Exposure”
has the meaning specified in Paragraph 12, except that after the word
“Agreement” the words “(assuming, for this purpose only, that Part 1(f) of the
Schedule is deleted)” shall be inserted.
“Local
Business Day”
means:
any day on which (A) commercial banks are open for business (including dealings
in foreign exchange and foreign currency deposits) in New York and the location
of Party A, Party B and any Custodian, and (B) in relation to a Transfer
of
Eligible Collateral, any day on which the clearance system agreed between
the
parties for the delivery of Eligible Collateral is open for acceptance and
execution of settlement instructions (or in the case of a Transfer of Cash
or
other Eligible Collateral for which delivery is contemplated by other means
a
day on which commercial banks are open for business (including dealings in
foreign exchange and foreign deposits) in New York and the location of Party
A,
Party B and any Custodian.
“Xxxxx’x
First Trigger Event” means
that no Relevant Entity has credit ratings from Xxxxx’x at least equal to the
Xxxxx’x First Trigger Ratings Threshold.
“Xxxxx’x
First Trigger Credit Support Amount” means,
for any Valuation Date, the excess, if any, of
|
(I)
|
(A)
|
for
any Valuation Date on which (I) a Xxxxx’x First Trigger Event has occurred
and has been continuing (x) for at least 30 Local Business Days
or (y)
since this Annex was executed and (II) it is not the case that
a Xxxxx’x
Second Trigger Event has occurred and been continuing for at least
30
Local Business Days, an amount equal to the greater of (a) zero
and (b)
the sum of (i) the Secured Party’s Exposure for such Valuation Date and
(ii) the sum, for each Transaction to which this Annex relates,
of the
product of (1) the applicable Xxxxx’x First Trigger Factor set forth in
Table 1 and (2) the Notional Amount for such Transaction for the
Calculation Period which includes such Valuation Date; or
|
|
(B)
|
for
any other Valuation Date, zero,
over
|
(II)
the
Threshold for Party A such Valuation Date.
“Xxxxx’x
First Trigger Ratings Threshold” means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, (i) if such entity has a short-term unsecured and
unsubordinated debt rating from Xxxxx’x, a long-term unsecured and
unsubordinated debt rating or
counterparty rating from
Xxxxx’x of “A2” and a short-term unsecured and unsubordinated debt rating from
Xxxxx’x of “Prime-1”, or (ii) if such entity does not have a short-term
unsecured and unsubordinated debt rating or counterparty rating from Xxxxx’x, a
long-term unsecured and unsubordinated debt rating or counterparty rating
from
Xxxxx’x of “A1”.
“Xxxxx’x
First Trigger Value”
means,
on any date and with respect to any Eligible Collateral other than Cash,
the bid
price obtained by the Valuation Agent multiplied by the Xxxxx’x First Trigger
Valuation Percentage for such Eligible Collateral set forth in Paragraph
13(b)(ii).
“Xxxxx’x
Second Trigger Event” means
that no Relevant Entity has credit ratings from Xxxxx’x at least equal to the
Xxxxx’x Second Trigger Ratings Threshold.
“Xxxxx’x
Second Trigger Credit Support Amount”
means,
for any Valuation Date, the excess, if any, of
|
(I)
|
(A)
|
for
any Valuation Date on which it is the case that a Xxxxx’x Second Trigger
Event has occurred and been continuing for at least 30 Local Business
Days, an amount equal to the greatest of (a) zero, (b) the aggregate
amount of the next payment due to be paid by Party A under each
Transaction to which this Annex relates, and (c) the sum of (x)
the
Secured Party’s Exposure for such Valuation Date and (y) the sum, for each
Transaction to which this Annex relates, of
|
(1)
if
such Transaction is not a Transaction-Specific Hedge, the product of (i)
the
applicable Xxxxx’x Second Trigger Factor set forth in Table 2 and (ii) the
Notional Amount for such Transaction for the Calculation Period which includes
such Valuation Date;
or
(2)
if
such Transaction is a Transaction-Specific Hedge, the
product of (i) the applicable Xxxxx’x Second Trigger Factor set forth in Table 3
and (ii) the Notional Amount for such Transaction for the Calculation Period
which includes such Valuation Date; or
|
(B)
|
for
any other Valuation Date, zero,
over
|
(II)
the
Threshold for Party A for such Valuation Date.
“Xxxxx’x
Second Trigger Ratings Threshold” means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, (i) if such entity has a short-term unsecured and
unsubordinated debt rating from Xxxxx’x, a long-term unsecured and
unsubordinated debt rating or counterparty rating from Xxxxx’x of “A3” and a
short-term unsecured and unsubordinated debt rating from Xxxxx’x of “Prime-2”,
or (ii) if such entity does not have a short-term unsecured and unsubordinated
debt rating from Xxxxx’x, a long-term unsecured and unsubordinated debt rating
or counterparty rating from Xxxxx’x of “A3”.
“Xxxxx’x
Second Trigger Value”
means,
on any date and with respect to any Eligible Collateral other than Cash,
the bid
price obtained by the Valuation Agent multiplied by the Xxxxx’x Second Trigger
Valuation Percentage for such Eligible Collateral set forth in Paragraph
13(b)(ii).
“Pricing
Sources”
means
the sources of financial information commonly known as Bloomberg, Bridge
Information Services, Data Resources Inc., Interactive Data Services,
International Securities Market Association, Xxxxxxx Xxxxx Securities Pricing
Service, Xxxxxx Data Corporation, Reuters, Wood Gundy, Trepp Pricing, XX
Xxxxx,
S&P and Telerate.
“S&P
Approved Ratings Threshold”
means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, a short-term unsecured and unsubordinated debt rating
from
S&P of “A-1”, or, if such entity does not have a short-term unsecured and
unsubordinated debt rating from S&P, a long-term unsecured and
unsubordinated debt rating from S&P of “A+”.
“S&P/DBRS
Credit Support Amount”
means,
for any Valuation Date, the excess, if any, of
|
(I)
|
(A)
|
for
any Valuation Date on which (i) an S&P/DBRS Rating Threshold Event has
occurred and been continuing for at least 30 days, or (ii) a S&P/DBRS
Required Ratings Downgrade Event has occurred and is continuing,
an amount
equal to the sum of (1) 100.0% of the Secured Party’s Exposure for such
Valuation Date and (2) the sum, for each Transaction to which this
Annex
relates, of the product of (i) the Volatility Buffer for such Transaction
and (ii) the Notional Amount of such Transaction for the Calculation
Period of such Transaction which includes such Valuation Date,
or
|
|
(B)
|
for
any other Valuation Date, zero,
over
|
(II) the
Threshold for Party A for such Valuation Date.
“S&P/DBRS
Rating Threshold Event”
means,
on any date, no Relevant Entity has credit ratings from S&P which equal or
exceed the S&P Approved Ratings Threshold and the DBRS Approved Ratings
Threshold.
“S&P/DBRS
Required Ratings Downgrade Event”
means
that no Relevant Entity has credit ratings at least equal to the S&P
Required Ratings Threshold and the DBRS Required Ratings Threshold.
“S&P/DBRS
Value”
means,
on any date and with respect to any Eligible Collateral other than Cash,
the
product of (A) the bid price obtained by the Valuation Agent for such Eligible
Collateral and (B) the S&P Valuation Percentage for such Eligible Collateral
set forth in paragraph 13(b)(ii).
“Transaction
Exposure”
means,
for any Transaction, Exposure determined as if such Transaction were the
only
Transaction between the Secured Party and the Pledgor.
“Transaction-Specific
Hedge” means
any
Transaction that is (i) an interest rate swap in respect of which (x) the
notional amount of the interest rate swap is “balance guaranteed” or (y) the
notional amount of the interest rate swap for any Calculation Period otherwise
is not a specific dollar amount that is fixed at the inception of the
Transaction, (ii) an interest rate cap, (iii) an interest rate floor or (iv)
an
interest rate swaption.
“Valuation
Percentage”
shall
mean, for purposes of determining the S&P/DBRS Value, Xxxxx’x First Trigger
Value, or Xxxxx’x Second Trigger Value with respect to any Eligible Collateral
or Posted Collateral, the applicable S&P/DBRS Valuation Percentage, Xxxxx’x
First Trigger Valuation Percentage, or Xxxxx’x Second Trigger Valuation
Percentage for such Eligible Collateral or Posted Collateral, respectively,
in
each case as set forth in Paragraph 13(b)(ii).
“Value”
shall
mean, in respect of any date, the related S&P/DBRS Value, the related
Xxxxx’x First Trigger Value, and the related Xxxxx’x Second Trigger
Value.
“Volatility
Buffer”
means,
for any Transaction, the related percentage set forth in the following table.
|
The
higher of the S&P credit rating of (i) Party A and (ii) the Credit
Support Provider of Party A, if applicable
|
Remaining
Weighted Average Maturity of such Transaction
up
to 3 years
|
Remaining
Weighted Average Maturity of such Transaction
up
to 5 years
|
Remaining
Weighted Average Maturity of such Transaction
up
to 10 years
|
Remaining
Weighted Average Maturity of such Transaction
up
to 30 years
|
|
“A-2”
or higher
|
2.75%
|
3.25%
|
4.00%
|
4.75%
|
|
“A-3”
|
3.25%
|
4.00%
|
5.00%
|
6.25%
|
|
“BB+”
or
lower
|
3.50%
|
4.50%
|
6.75%
|
7.50%
|
[Remainder
of this page intentionally left blank]
Table
1
Xxxxx’x
First Trigger Factor
|
Remaining
Weighted
Average Life
of
Hedge in Years
|
Daily
Collateral
Posting
|
|
1
or less
|
0.15%
|
|
More
than 1 but not more than 2
|
0.30%
|
|
More
than 2 but not more than 3
|
0.40%
|
|
More
than 3 but not more than 4
|
0.60%
|
|
More
than 4 but not more than 5
|
0.70%
|
|
More
than 5 but not more than 6
|
0.80%
|
|
More
than 6 but not more than 7
|
1.00%
|
|
More
than 7 but not more than 8
|
1.10%
|
|
More
than 8 but not more than 9
|
1.20%
|
|
More
than 9 but not more than 10
|
1.30%
|
|
More
than 10 but not more than 11
|
1.40%
|
|
More
than 11 but not more than 12
|
1.50%
|
|
More
than 12 but not more than 13
|
1.60%
|
|
More
than 13 but not more than 14
|
1.70%
|
|
More
than 14 but not more than 15
|
1.80%
|
|
More
than 15 but not more than 16
|
1.90%
|
|
More
than 16 but not more than 17
|
2.00%
|
|
More
than 17 but not more than 18
|
2.00%
|
|
More
than 18 but not more than 19
|
2.00%
|
|
More
than 19 but not more than 20
|
2.00%
|
|
More
than 20 but not more than 21
|
2.00%
|
|
More
than 21 but not more than 22
|
2.00%
|
|
More
than 22 but not more than 23
|
2.00%
|
|
More
than 23 but not more than 24
|
2.00%
|
|
More
than 24 but not more than 25
|
2.00%
|
|
More
than 25 but not more than 26
|
2.00%
|
|
More
than 26 but not more than 27
|
2.00%
|
|
More
than 27 but not more than 28
|
2.00%
|
|
More
than 28 but not more than 29
|
2.00%
|
|
More
than 29
|
2.00%
|
Table
2
Xxxxx’x
Second Trigger Factor for Interest Rate Swaps with Fixed Notional
Amounts
|
Remaining
Weighted
Average Life
of
Hedge in Years
|
Daily
Collateral
Posting
|
|
1
or less
|
0.50%
|
|
More
than 1 but not more than 2
|
1.00%
|
|
More
than 2 but not more than 3
|
1.50%
|
|
More
than 3 but not more than 4
|
1.90%
|
|
More
than 4 but not more than 5
|
2.40%
|
|
More
than 5 but not more than 6
|
2.80%
|
|
More
than 6 but not more than 7
|
3.20%
|
|
More
than 7 but not more than 8
|
3.60%
|
|
More
than 8 but not more than 9
|
4.00%
|
|
More
than 9 but not more than 10
|
4.40%
|
|
More
than 10 but not more than 11
|
4.70%
|
|
More
than 11 but not more than 12
|
5.00%
|
|
More
than 12 but not more than 13
|
5.40%
|
|
More
than 13 but not more than 14
|
5.70%
|
|
More
than 14 but not more than 15
|
6.00%
|
|
More
than 15 but not more than 16
|
6.30%
|
|
More
than 16 but not more than 17
|
6.60%
|
|
More
than 17 but not more than 18
|
6.90%
|
|
More
than 18 but not more than 19
|
7.20%
|
|
More
than 19 but not more than 20
|
7.50%
|
|
More
than 20 but not more than 21
|
7.80%
|
|
More
than 21 but not more than 22
|
8.00%
|
|
More
than 22 but not more than 23
|
8.00%
|
|
More
than 23 but not more than 24
|
8.00%
|
|
More
than 24 but not more than 25
|
8.00%
|
|
More
than 25 but not more than 26
|
8.00%
|
|
More
than 26 but not more than 27
|
8.00%
|
|
More
than 27 but not more than 28
|
8.00%
|
|
More
than 28 but not more than 29
|
8.00%
|
|
More
than 29
|
8.00%
|
Table
3
Xxxxx’x
Second Trigger Factor for Transaction-Specific Xxxxxx
|
Remaining
Weighted
Average Life
of
Hedge in Years
|
Daily
Collateral
Posting
|
|
1
or less
|
0.65%
|
|
More
than 1 but not more than 2
|
1.30%
|
|
More
than 2 but not more than 3
|
1.90%
|
|
More
than 3 but not more than 4
|
2.50%
|
|
More
than 4 but not more than 5
|
3.10%
|
|
More
than 5 but not more than 6
|
3.60%
|
|
More
than 6 but not more than 7
|
4.20%
|
|
More
than 7 but not more than 8
|
4.70%
|
|
More
than 8 but not more than 9
|
5.20%
|
|
More
than 9 but not more than 10
|
5.70%
|
|
More
than 10 but not more than 11
|
6.10%
|
|
More
than 11 but not more than 12
|
6.50%
|
|
More
than 12 but not more than 13
|
7.00%
|
|
More
than 13 but not more than 14
|
7.40%
|
|
More
than 14 but not more than 15
|
7.80%
|
|
More
than 15 but not more than 16
|
8.20%
|
|
More
than 16 but not more than 17
|
8.60%
|
|
More
than 17 but not more than 18
|
9.00%
|
|
More
than 18 but not more than 19
|
9.40%
|
|
More
than 19 but not more than 20
|
9.70%
|
|
More
than 20 but not more than 21
|
10.00%
|
|
More
than 21 but not more than 22
|
10.00%
|
|
More
than 22 but not more than 23
|
10.00%
|
|
More
than 23 but not more than 24
|
10.00%
|
|
More
than 24 but not more than 25
|
10.00%
|
|
More
than 25 but not more than 26
|
10.00%
|
|
More
than 26 but not more than 27
|
10.00%
|
|
More
than 27 but not more than 28
|
10.00%
|
|
More
than 28 but not more than 29
|
10.00%
|
|
More
than 29
|
10.00%
|
Schedule
1
Eligible
Collateral
|
Eligible
Collateral & Valuation Percentages
Xxxxx’x
and S&P/DBRS
|
||||
|
Valuation
Percentage
|
Valuation
Percentage
|
|||
|
Xxxxx’x
|
S&P/DBRS
|
|||
|
First
Trigger
|
Second
Trigger
|
Daily
|
||
|
(A)
|
Cash
|
100
|
100
|
100
|
|
(B)
|
Fixed-rate
negotiable debt obligations issued by the U.S. Treasury Department
having
a remaining maturity on such date of not more than one
year
|
100
|
100
|
98.5
|
|
(C)
|
Fixed-rate
negotiable debt obligations issued by the U.S. Treasury Department
having
a remaining maturity on such date of more than one year but
not more than
ten years
|
100
|
94
|
89.9
|
|
(D)
|
Fixed-rate
negotiable debt obligations issued by the U.S. Treasury Department
having
a remaining maturity on such date of more than ten years
|
100
|
87
|
83.9
|
|
(E)
|
Agency
Securities:
negotiable debt obligations of the Federal National Mortgage
Association
(FNMA) and Xxxxxxx Mac (collectively, “Agency
Securities”)
issued after July 18, 1984 and having a remaining maturity
of not more
than 1 year.
|
100
|
99
|
98.5
|
|
(F)
|
Agency
Securities having a remaining maturity of greater than 1 year
but not more
than 2 years.
|
100
|
98
|
97.7
|
|
(G)
|
Agency
Securities having a remaining maturity of greater than 2 years
but not
more than 3 years.
|
100
|
97
|
97.3
|
|
(H)
|
Agency
Securities having a remaining maturity of greater than 3 years
but not
more than 5 years.
|
100
|
96
|
94.5
|
|
(I)
|
Agency
Securities having a remaining maturity of greater than 5 years
but not
more than 7 years.
|
100
|
94
|
93.1
|
|
(J)
|
Agency
Securities having a remaining maturity of greater than 7 years
but not
more than 10 years.
|
100
|
93
|
90.7
|
|
(K)
|
Agency
Securities having a remaining maturity of greater than 10 years
but not
more than 20 years.
|
100
|
88
|
87.7
|
|
(L)
|
Agency
Securities having a remaining maturity of greater than 20 years
but not
more than 30 years.
|
100
|
86
|
84.4
|
IN
WITNESS WHEREOF, the parties have executed this Annex by their duly authorized
representatives as of the date of the Agreement.
|
HSBC
Bank USA, National Association
|
HSBC
Bank USA, National Association, not individually, but solely as
Supplemental Interest Trust Trustee on behalf of the Supplemental
Interest
Trust with respect to the Nomura Home Equity Loan, Inc., Home Equity
Loan
Trust, Series 2007-2
|
|
By: _____________________________
Name
Title:
Date:
|
By:_____________________________
Name:
Title:
Date:
|
EXHIBIT
Q
SWAP
AGREEMENT
HSBC
Bank
USA, National Association
000
Xxxxx
Xxxxxx
Xxx
Xxxx,
XX 00000
Fax:
(000)000-0000
|
DATE:
|
January
31, 2007
|
|
TO:
|
HSBC
Bank USA, National Association,
not in its individual capacity but solely in its capacity as Supplemental
Interest Trust Trustee on behalf of the Supplemental Interest Trust
with
respect to the Nomura Home Equity Loan, Inc., Home Equity Loan
Trust,
Series 2007-2
|
|
ATTENTION:
|
HSBC
Bank USA, National Association
000
Xxxxx Xxx.
Xxx
Xxxx, XX 00000
|
|
FACSIMILE:
|
000-000-0000
|
|
with
a copy to:
|
|
|
ATTENTION:
|
Xxxxx
Fargo Bank, N.A.
0000
Xxx Xxxxxxxxx Xxxx
Xxxxxxxx,
XX 00000
Attn:
Client Manager, NHEL 2007-2
|
|
FACSIMILE:
|
000-000-0000
|
|
FROM:
|
HSBC
Bank USA, National Association
|
|
FACSIMILE:
|
000-000-0000
|
|
SUBJECT:
|
Fixed
Income Derivatives Confirmation
|
|
REFERENCE
NUMBER:
|
454006HN
|
The
purpose of this long-form confirmation (“Confirmation”)
is to
confirm the terms and conditions of the current Transaction entered into
on the
Trade Date specified below (the “Transaction”)
between
HSBC Bank USA, National Association (“Party
A”)
and
HSBC Bank USA, National Association, not individually, but solely as
supplemental interest trust trustee (the “Supplemental Interest Trust Trustee”)
on behalf of the supplemental interest trust with respect to the Nomura Home
Equity Loan, Inc., Home Equity Loan Trust, Series 2007-2 (the “Supplemental
Interest Trust”)
(“Party
B”)
created
under the Pooling and Servicing Agreement, dated as of January 1, 2007, among
Nomura Home Equity Loan, Inc., as depositor (the “Depositor”),
Nomura Credit & Capital, Inc., as sponsor (the “Sponsor”),
Xxxxx
Fargo Bank, N.A., as master servicer (the “Master
Servicer”)
and
securities administrator (the “Securities
Administrator”),
Owcen
Loan Servicing, LLC, Select Portfolio Servicing Inc. and Equity One Inc.,
each
as servicer (each a “Servicer”
and
collectively, the “Servicers”)
and
HSBC Bank USA, National Association, not in its individual capacity, but
solely
as trustee (the “Trustee”) (the
“Pooling
and Servicing Agreement”).
This
Confirmation evidences a complete and binding agreement between you and us
to
enter into the Transaction on the terms set forth below and replaces any
previous agreement between us with respect to the subject matter hereof.
This
Confirmation constitutes a “Confirmation”
and also
constitutes a “Schedule”
as
referred to in the ISDA Master Agreement, and Paragraph 13 of a Credit Support
Annex to the Schedule.
| 1. |
This
Confirmation shall supplement, form a part of, and be subject to
an
agreement in the form of the ISDA Master Agreement (Multicurrency
- Cross
Border) as published and copyrighted in 1992 by the International
Swaps
and Derivatives Association, Inc. (the “ISDA
Master Agreement”),
as if Party A and Party B had executed an agreement in such form
on the
date hereof, with a Schedule as set forth in Item 3 of this Confirmation,
and an ISDA Credit Support Annex (Bilateral Form - ISDA Agreements
Subject
to New York Law Only version) as published and copyrighted in 1994
by the
International Swaps and Derivatives Association, Inc., with Paragraph
13
thereof as set forth in Annex A hereto (the “Credit
Support Annex”).
For the avoidance of doubt, the Transaction described herein shall
be the
sole Transaction governed by such ISDA Master Agreement. In the
event of
any inconsistency among any of the following documents, the relevant
document first listed shall govern: (i) this Confirmation, exclusive
of
the provisions set forth in Item 3 hereof and Annex A hereto; (ii)
the
provisions set forth in Item 3 hereof, which are incorporated by
reference
into the Schedule; (iii) the Credit Support Annex; (iv) the Definitions;
and (v) the ISDA Master Agreement.
Each
reference herein to a “Section” (unless specifically referencing the
Pooling and Servicing Agreement) or to a “Section” “of this Agreement”
will be construed as a reference to a Section of the ISDA Master
Agreement; each herein reference to a “Part” will be construed as a
reference to the provisions herein deemed incorporated in a Schedule
to
the ISDA Master Agreement; each reference herein to a “Paragraph” will be
construed as a reference to a Paragraph of the Credit Support
Annex.
|
| 2. |
The
terms
of the particular Transaction to which this Confirmation relates
are as
follows:
|
|
Type
of Transaction:
|
Interest
Rate Swap
|
||
|
Notional
Amount:
|
With
respect to any Calculation Period the Notional
Amount
as
set forth in Schedule I, which is attached hereto and incorporated
by
reference into this Confirmation
|
||
|
Trade
Date:
|
January
29, 2007
|
||
|
Effective
Date:
|
July
25, 2007
|
||
|
Termination
Date:
|
January
25, 2012
|
||
|
Additional
Fixed Amount:
|
As
per side agreement
|
||
|
Fixed
Amounts:
|
|||
|
Fixed
Amount Payer:
|
Party
B
|
||
|
Fixed
Rate Payer Period End Dates:
|
The
25th
calendar day of each month, commencing on August 25, 2007 and ending
on
the Termination Date, subject to No Adjustment.
|
||
|
No
Adjustment to Period End Dates:
|
Applicable
|
||
|
Fixed
Rate Payer Payment Dates:
|
Early
Payment shall be applicable. The Fixed Rate payer Payment Date
shall be
one Business Day prior to such Fixed Rate payer period End
Date.
|
||
|
Fixed
Rate:
|
5.300000
%
|
||
|
Fixed
Rate Day Count Fraction:
|
30/360
|
||
|
Floating
Amounts:
|
|||
|
Floating
Rate Payer:
|
Party
A
|
||
|
Floating
Rate Payer Period End Dates:
|
The
25th
calendar day of each month, commencing on August 25, 2007 and ending
on
the Termination Date, subject to adjustment in accordance with
the
Following Business Day Convention
|
||
|
Floating
Rate Payer Payment Dates:
|
Early
Payment shall be applicable. The Floating Rate payer Payment Date
shall be
one Business Day prior to such Fixed Rate payer period End
Date.
|
||
|
Floating
Rate Option:
|
USD-LIBOR-BBA
|
||
|
Designated
Maturity:
|
One
month
|
||
|
Floating
Rate for Initial Calculation Period:
|
To
be determined
|
||
|
Spread:
|
None
|
||
|
Floating
Rate Day Count Fraction:
|
Actual/360
|
||
|
Reset
Dates:
|
The
first day of each Calculation Period
|
||
|
Compounding:
|
Inapplicable
|
||
|
Business
Days
|
New
York
|
||
| 3. |
Provisions
Deemed Incorporated in a Schedule to the ISDA Master
Agreement:
|
|
Part
1.
|
Termination
Provisions.
|
For
the
purposes of this Agreement:-
(a) “Specified
Entity”
will not
apply to Party A or Party B for any purpose.
(b) “Specified
Transaction”
will
have the meaning specified in Section 14.
(c) Events
of Default.
The
statement below that an Event of Default will apply to a specific party means
that upon the occurrence of such an Event of Default with respect to such
party,
the other party shall have the rights of a Non-defaulting Party under Section
6
of this Agreement; conversely, the statement below that such event will not
apply to a specific party means that the other party shall not have such
rights.
| (i) |
The
“Failure
to Pay or Deliver”
provisions of Section 5(a)(i) will apply to Party A and will apply
to
Party B; provided, however, that Section 5(a)(i) is hereby amended
by
replacing the word “third” with the word “first”; provided, further, that
notwithstanding anything to the contrary in Section 5(a)(i), any
failure
by Party A to comply with or perform any obligation to be complied
with or
performed by Party A under the Credit Support Annex shall not constitute
an Event of Default under Section 5(a)(i) unless (A) a Required Ratings
Downgrade Event has occurred and been continuing for 30 or more Local
Business Days, and (B) such failure is not remedied on or before
the third
Local Business Day after notice of such failure is given to Party
A.
|
| (ii) |
The
“Breach
of Agreement”
provisions of Section 5(a)(ii) will apply to Party A and will not
apply to
Party B.
|
| (iii) |
The
“Credit
Support Default”
provisions of Section 5(a)(iii) will apply to Party A and will not
apply
to Party B except that Section 5(a)(iii)(1) will apply to Party B
solely
in respect of Party B’s obligations under Paragraph 3(b) of the Credit
Support Annex; provided, however, that notwithstanding anything to
the
contrary in Section 5(a)(iii)(1), any failure by Party A to comply
with or
perform any obligation to be complied with or performed by Party
A under
the Credit Support Annex shall not constitute an Event of Default
under
Section 5(a)(iii) unless (A) a Required Ratings Downgrade Event has
occurred and been continuing for 30 or more Local Business Days,
and (B)
such failure is not remedied on or before the third Local Business
Day
after notice of such failure is given to Party
A.
|
| (iv) |
The
“Misrepresentation”
provisions of Section 5(a)(iv) will apply to Party A and will not
apply to
Party B.
|
| (v) |
The
“Default
under Specified Transaction”
provisions of Section 5(a)(v) will apply to Party A and will not
apply to
Party B.
|
| (vi) |
The
“Cross
Default”
provisions of Section 5(a)(vi) will apply to Party A and will not
apply to
Party B. For purposes of Section 5(a)(vi), solely with respect to
Party
A:
|
“Specified
Indebtedness” will have the meaning specified in Section 14, except that such
term shall not include obligations in respect of deposits received in the
ordinary course of Party A’s banking business.
“Threshold
Amount” means with respect to Party A an amount equal to three percent (3%) of
the Shareholders’ Equity of Party A (as set forth in Party A’s Call Report) or,
if applicable, the Eligible Guarantor.
“Shareholders’
Equity” means with respect to an entity, at any time, the sum (as shown in the
most recent annual audited financial statements of such entity) of (i) its
capital stock (including preferred stock) outstanding, taken at par value,
(ii)
its capital surplus and (iii) its retained earnings, minus (iv) treasury
stock,
each to be determined in accordance with generally accepted accounting
principles.
| (vii) |
The
“Bankruptcy”
provisions of Section 5(a)(vii) will apply to Party A and will apply
to
Party B except that the provisions of Section 5(a)(vii)(2), (6) (to
the
extent that such provisions refer to any appointment contemplated
or
effected by the Pooling and Servicing Agreement or any appointment
to
which Party B has not become subject), (7) and (9) will not apply
to Party
B; provided that, with respect to Party B only, Section 5(a)(vii)(4)
is
hereby amended by adding after the words “against it” the words
“(excluding any proceeding or petition instituted or presented by
Party A
or its Affiliates)”, and Section 5(a)(vii)(8) is hereby amended by
deleting the words “to (7) inclusive” and inserting lieu thereof “, (3),
(4) as amended, (5), (6) as amended, or
(7)”.
|
| (viii) |
The
“Merger
Without Assumption”
provisions of Section 5(a)(viii) will apply to Party A and will not
apply
to Party B.
|
(d) Termination
Events.
The
statement below that a Termination Event will apply to a specific party means
that upon the occurrence of such a Termination Event, if such specific party
is
the Affected Party with respect to a Tax Event, the Burdened Party with respect
to a Tax Event Upon Merger (except as noted below) or the non-Affected Party
with respect to a Credit Event Upon Merger, as the case may be, such specific
party shall have the right to designate an Early Termination Date in accordance
with Section 6 of this Agreement; conversely, the statement below that such
an
event will not apply to a specific party means that such party shall not
have
such right; provided, however, with respect to “Illegality” the statement that
such event will apply to a specific party means that upon the occurrence
of such
a Termination Event with respect to such party, either party shall have the
right to designate an Early Termination Date in accordance with Section 6
of
this Agreement.
| (i) |
The
“Illegality”
provisions of Section 5(b)(i) will apply to Party A and will apply
to
Party B.
|
|
(ii)
|
The
“Tax
Event”
provisions of Section 5(b)(ii) will apply to Party A except that,
for
purposes of the application of Section 5(b)(ii) to Party A, Section
5(b)(ii) is hereby amended by deleting the words “(x) any action taken by
a taxing authority, or brought in a court of competent jurisdiction,
on or
after the date on which a Transaction is entered into (regardless
of
whether such action is taken or brought with respect to a party
to this
Agreement) or (y)”, and the “Tax
Event”
provisions of Section 5(b)(ii) will apply to Party B.
|
|
(iii)
|
The
“Tax
Event Upon Merger”
provisions of Section 5(b)(iii) will apply to Party A and will
apply to
Party B, provided that Party A shall not be entitled to designate
an Early
Termination Date by reason of a Tax Event upon Merger in respect
of which
it is the Affected Party.
|
|
(iv)
|
The
“Credit
Event Upon Merger”
provisions of Section 5(b)(iv) will not apply to Party A and will
not
apply to Party B.
|
(e) The
“Automatic
Early Termination”
provision of Section 6(a) will not apply to Party A and will not apply to
Party
B.
(f) Payments
on Early Termination.
For the
purpose of Section 6(e) of this Agreement:
| (i) |
Market
Quotation will apply, provided, however, that, in the event of a
Derivative Provider Trigger Event, the following provisions will
apply:
|
|
(A)
|
The
definition of Market Quotation in Section 14 shall be deleted in
its
entirety and replaced with the
following:
|
“Market
Quotation” means,
with respect to one or more Terminated Transactions, a Firm Offer which is
(1)
made by a Reference Market-maker that is an Eligible Replacement, (2) for
an
amount that would be paid to Party B (expressed as a negative number) or
by
Party B (expressed as a positive number) in consideration of an agreement
between Party B and such Reference Market-maker to enter into a Replacement
Transaction, and (3) made on the basis that Unpaid Amounts in respect of
the
Terminated Transaction or group of Transactions are to be excluded but, without
limitation, any payment or delivery that would, but for the relevant Early
Termination Date, have been required (assuming satisfaction of each applicable
condition precedent) after that Early Termination Date is to be included.
|
(B)
|
The
definition of Settlement Amount shall be deleted in its entirety
and
replaced with the following:
|
“Settlement
Amount”
means,
with respect to any Early Termination Date, an amount (as determined by Party
B)
equal to:
|
(a)
|
If
a Market Quotation for the relevant Terminated Transaction or group
of
Terminated Transactions is accepted by Party B so as to become
legally
binding on or before the day falling ten Local Business Days after
the day
on which the Early Termination Date is designated, or such later
day as
Party B may specify in writing to Party A, but in either case no
later
than one Local Business Day prior to the Early Termination Date
(such day,
the “Latest Settlement Amount Determination Day”), the Termination
Currency Equivalent of the amount (whether positive or negative)
of such
Market Quotation;
|
|
(b)
|
If,
on the Latest Settlement Amount Determination Day, no Market Quotation
for
the relevant Terminated Transaction or group of Terminated Transactions
has been accepted by Party B so as to become legally binding and
one or
more Market Quotations from
Approved Replacements have
been made and remain capable of becoming legally binding upon acceptance,
the Settlement Amount shall equal the Termination Currency Equivalent
of
the amount (whether positive or negative) of the lowest of such
Market
Quotations (for the avoidance of doubt, the lowest of such Market
Quotations shall be the lowest Market Quotation of
such Market Quotations
expressed as a positive number or, if any of such Market Quotations
is
expressed as a negative number, the Market Quotation expressed
as a
negative number with the largest absolute value);
or
|
|
(c)
|
If,
on the Latest Settlement Amount Determination Day, no Market Quotation
for
the relevant Terminated Transaction or group of Terminated Transactions
is
accepted by Party B so as to become legally binding and no Market
Quotation from an Approved Replacement remains capable of becoming
legally
binding upon acceptance, the Settlement Amount shall equal Party
B’s Loss
(whether positive or negative and without reference to any Unpaid
Amounts)
for the relevant Terminated Transaction or group of Terminated
Transactions.
|
|
(C)
|
If
Party B requests Party A in writing to obtain Market Quotations,
Party A
shall use its reasonable efforts to do so before the Latest Settlement
Amount Determination Day.
|
|
(D)
|
If
the Settlement Amount is a negative number, Section 6(e)(i)(3)
shall be
deleted in its entirety and replaced with the
following:
|
“(3)
Second
Method and Market Quotation.
If the
Second Method and Market Quotation apply, (I) Party B shall pay to Party
A an
amount equal to the absolute value of the Settlement Amount in respect of
the
Terminated Transactions, (II) Party B shall pay to Party A the Termination
Currency Equivalent of the Unpaid Amounts owing to Party A and (III) Party
A
shall pay to Party B the Termination Currency Equivalent of the Unpaid Amounts
owing to Party B; provided, however, that (x) the amounts payable under the
immediately preceding clauses (II) and (III) shall be subject to netting
in
accordance with Section 2(c) of this Agreement and (y) notwithstanding any
other
provision of this Agreement, any amount payable by Party A under the immediately
preceding clause (III) shall not be netted-off against any amount payable
by
Party B under the immediately preceding clause (I).”
|
(E)
|
At
any time on or before the Latest Settlement Amount Determination
Day at
which two or more Market Quotations from Approved Replacements
remain
capable of becoming legally binding upon acceptance, Party B shall
be
entitled to accept only the lowest of such Market Quotations (for
the
avoidance of doubt, the lowest of such Market Quotations shall
be the
lowest Market Quotation of such Market Quotations expressed as
a positive
number or, if any of such Market Quotations is expressed as a negative
number, the Market Quotation expressed as a negative number with
the
largest absolute value).
|
| (ii) |
The
Second Method will apply.
|
(g) “Termination
Currency”
means
USD.
(h) Additional
Termination Events.
Additional Termination Events will apply as provided in Part 5(c).
Part
2. Tax
Matters.
(a) Tax
Representations.
|
(i)
|
Payer
Representations.
For the purpose of Section 3(e) of this Agreement:
|
(A) Party
A
makes the following representation(s):
It
is not
required by any applicable law, as modified by the practice of any relevant
governmental revenue authority, of any Relevant Jurisdiction to make any
deduction or withholding for or on account of any Tax from any payment (other
than interest under Section 2(e), 6(d)(ii) or 6(e) of this Agreement) to
be made
by it to the other party under this Agreement. In making this representation,
it
may rely on: (i) the accuracy of any representations made by the other party
pursuant to Section 3(f) of this Agreement; (ii) the satisfaction of the
agreement contained in Section 4(a)(i) or 4(a)(iii) of this Agreement and
the
accuracy and effectiveness of any document provided by the other party pursuant
to Section 4(a)(i) or 4(a)(iii) of this Agreement; and (iii) the satisfaction
of
the agreement of the other party contained in Section 4(d) of this Agreement,
provided that it shall not be a breach of this representation where reliance
is
placed on clause (ii) and the other party does not deliver a form or document
under Section 4(a)(iii) by reason of material prejudice to its legal or
commercial position.
(B) Party
B
makes the following representation(s):
None.
|
(ii)
|
Payer
Representations.
For the purpose of Section 3(f) of this Agreement:
|
(A) Party
A
makes the following representation(s):
Party
A
is a national banking association organized under the federal laws of the
United
States and its U.S. taxpayer identification number is 00-0000000.
(B) Party
B
makes the following representation(s):
None.
|
(b)
|
Tax
Provisions.
|
|
(i)
|
Gross
Up.
Section 2(d)(i)(4) shall not apply to Party B as X, and Section
2(d)(ii)
shall not apply to Party B as Y, in each case such that Party B
shall not
be required to pay any additional amounts referred to
therein.
|
|
(ii)
|
Indemnifiable
Tax.
The definition of “Indemnifiable Tax” in Section 14 is deleted in its
entirety and replaced with the
following:
|
“Indemnifiable
Tax”
means,
in relation to payments by Party A, any Tax and, in relation to payments
by
Party B, no Tax.
Part
3. Agreement
to Deliver Documents.
(a) For
the
purpose of Section 4(a)(i), tax forms, documents, or certificates to be
delivered are:
|
Party
required to deliver document
|
Form/Document/
Certificate
|
Date
by which to be delivered
|
||
|
Party
A
|
A
correct, complete and duly executed U.S. Internal Revenue Service
Form W-9
or other applicable form (or successor thereto), together with
appropriate
attachments, that eliminates U.S. federal withholding and backup
withholding Tax on payments to Party A under this
Agreement.
|
(i)
upon execution of this Agreement, (ii) on or before the first payment
date
under this Agreement, including any Credit Support Document, (iii)
promptly upon the reasonable demand by Party B, (iv) prior to the
expiration or obsolescence of any previously delivered form, and
(v)
promptly upon the information on any such previously delivered form
becoming inaccurate or incorrect
|
||
|
Party
B
|
Party
B will deliver at closing a correct, complete and duly executed
U.S.
Internal Revenue Service Form W-9 or other applicable form (or
successor
thereto), together with appropriate attachments, and may deliver
other
tax forms
relating to the beneficial owner of payments to Party B under this
Agreement from time to time
|
(i)
upon execution of this Agreement, (ii) on or before the first payment
date
under this Agreement, including any Credit Support Document, (iii)
promptly upon the reasonable demand by Party A, (iv) prior to the
expiration or obsolescence of any previously delivered form, and
(v)
promptly upon the information on any such previously delivered form
becoming inaccurate or incorrect
|
(b) For
the
purpose of Section 4(a)(ii), other documents to be delivered are:
|
Party
required to deliver document
|
Form/Document/
Certificate
|
Date
by which to
be
delivered
|
Covered
by Section 3(d) Representation
|
|||
|
Party
A and
Party
B
|
Any
documents required by the receiving party to evidence the authority
of the
delivering party or its Credit Support Provider, if any, for it
to execute
and deliver the Agreement, this Confirmation, and any Credit Support
Documents to which it is a party, and to evidence the authority
of the
delivering party or its Credit Support Provider to perform its
obligations
under the Agreement, this Confirmation and any Credit Support Document,
as
the case may be
|
Upon
the execution and delivery of this Agreement
|
Yes
|
|||
|
Party
A and
Party
B
|
A
certificate of an authorized officer of the party, as to the incumbency
and authority of the respective officers of the party signing the
Agreement, this Confirmation, and any relevant Credit Support Document,
as
the case may be
|
Upon
the execution and delivery of this Agreement
|
Yes
|
|||
|
Party
A
|
Annual
Financial Statements as set forth in Party A’s Call Report containing
consolidated financial statements certified by independent certified
public accountants and prepared in accordance with generally accepted
accounting principles in the country in which Party A is
organized
|
Promptly
upon request made by Party B
|
Yes
|
|||
|
Party
A
|
Quarterly
Financial Statements as set forth in Party A’s Call Report containing
unaudited, consolidated financial statements of Party A’s fiscal quarter
prepared in accordance with generally accepted accounting principles
in
the country in which Party A is organized
|
Promptly
upon request made by Party B
|
Yes
|
|||
|
Party
A
|
An
opinion of counsel to Party A satisfactory in form and substance
to Party
B
|
Upon
the execution and delivery of this Agreement
|
No
|
Part
4. Miscellaneous.
|
(a)
|
Address
for Notices:
For the purposes of Section 12(a) of this
Agreement:
|
Address
for notices or communications to Party A:
|
Address:
|
000
Xxxxx Xxxxxx, Xxx Xxxx, XX 00000
|
|
|
Attention:
|
Xxxxxxxxx
XxXxxxxx
|
|
|
Facsimile:
|
000-000-0000
|
|
|
Telephone:
|
000-000-0000
|
Please
direct all settlement inquiries to:
|
HSBC
Bank USA, National Association
|
||
|
Derivative
Settlements
|
||
|
Attention:
|
Xxxxxxx
Xxxxxxx
|
|
|
Telephone:
|
(000)
000-0000
|
|
|
Fax:
|
(000)
000-0000
|
|
(For
all
purposes)
Address
for notices or communications to Party B:
|
Attention:
|
HSBC
BANK USA, National Association
000
Xxxxx Xxx.
Xxx
Xxxx, XX 00000
|
|
|
Facsimile:
|
000-000-0000
|
|
|
with
a copy to:
|
||
|
Attention:
|
Xxxxx
Fargo Bank, N.A.
0000
Xxx Xxxxxxxxx Xxxx
Xxxxxxxx,
XX 00000
Attn:
Client Manager, NHEL 2007-2
|
|
|
Facsimile:
|
000-000-0000
|
(For
all
purposes)
(b) Process
Agent.
For the
purpose of Section 13(c):
Party
A
appoints as its Process Agent: Not applicable.
Party
B
appoints as its Process Agent: Not applicable.
|
(c)
|
Offices.
The provisions of Section 10(a) will apply to this Agreement; neither
Party A nor Party B has any Offices other than as set forth in
the Notices
Section and Party A agrees that, for purposes of Section 6(b) of
this
Agreement, it shall not in the future have any Office other than
one in
the United States.
|
|
(d)
|
Multibranch
Party.
For the purpose of Section 10(c) of this
Agreement:
|
Party
A
is not a Multibranch Party.
Party
B
is not a Multibranch Party.
|
(e)
|
Calculation
Agent.
The Calculation Agent is Party A; provided, however, that if an
Event of
Default shall have occurred with respect to Party A, Party B shall
have
the right to appoint as Calculation Agent a third party, reasonably
acceptable to Party A, the cost for which shall be borne by Party
A.
|
(f) Credit
Support Document.
|
Party
A:
|
The
Credit Support Annex, and any guarantee in support of Party A’s
obligations under this Agreement.
|
Party
B: The
Credit Support Annex, solely in respect of Party B’s obligations under Paragraph
3(b) of the Credit Support Annex.
|
(g)
|
Credit
Support Provider.
|
Party
A: The
guarantor under any guarantee in support of Party A’s obligations under this
Agreement.
Party
B: None.
|
(h)
|
Governing
Law.
The parties to this Agreement hereby agree that the law of the
State of
New York shall govern their rights and duties in whole, without
regard to
the conflict of law provisions thereof other than New York General
Obligations Law Sections 5-1401 and 5-1402.
|
|
(i)
|
Netting
of Payments.
The parties agree that subparagraph (ii) of Section 2(c) will apply
to
each Transaction hereunder.
|
|
(j)
|
Affiliate.“Affiliate”
shall have the meaning assigned thereto in Section 14; provided,
however,
that Party A and Party B shall be deemed to have no Affiliates
for
purposes of this Agreement, including for purposes of Section
6(b)(ii).
|
Part
5. Others
Provisions.
|
(a)
|
Definitions.
Unless
otherwise specified in a Confirmation, this Agreement and each
Transaction
under this Agreement are subject to the 2000 ISDA Definitions as
published
and copyrighted in 2000 by the International Swaps and Derivatives
Association, Inc. (the “Definitions”),
and will be governed in all relevant respects by the provisions
set forth
in the Definitions, without regard to any amendment to the Definitions
subsequent to the date hereof. The provisions of the Definitions
are
hereby incorporated by reference in and shall be deemed a part
of this
Agreement, except that (i) references in the Definitions to a “Swap
Transaction” shall be deemed references to a “Transaction” for purposes of
this Agreement, and (ii) references to a “Transaction” in this Agreement
shall be deemed references to a “Swap Transaction” for purposes of the
Definitions. Each term capitalized but not defined in this Agreement
shall
have the meaning assigned thereto in the Pooling and Servicing
Agreement.
|
(b) Amendments
to ISDA Master Agreement.
|
(i)
|
Single
Agreement.
Section 1(c) is hereby amended by the adding the words “including, for the
avoidance of doubt, the Credit Support Annex” after the words “Master
Agreement”.
|
(ii) Conditions
Precedent. Section
2(a)(iii) is hereby amended by adding the following at the end thereof:
Notwithstanding
anything to the contrary in Section 2(a)(iii)(1), if an Event of Default
with
respect to Party B or Potential Event of Default with respect to Party B
has
occurred and been continuing for more than 30 Local Business Days and no
Early
Termination Date in respect of the Affected Transactions has occurred or
been
effectively designated by Party A, the obligations of Party A under Section
2(a)(i) shall cease to be subject to the condition precedent set forth in
Section 2(a)(iii)(1) with respect to such specific occurrence of such Event
of
Default or such Potential Event of Default (the “Specific
Event”);
provided, however, for the avoidance of doubt, the obligations of Party A
under
Section 2(a)(i) shall be subject to the condition precedent set forth in
Section
2(a)(iii)(1) (subject to the foregoing) with respect to any subsequent
occurrence of the same Event of Default with respect to Party B or Potential
Event of Default with respect to Party B after the Specific Event has ceased
to
be continuing and with respect to any occurrence of any other Event of Default
with respect to Party B or Potential Event of Default with respect to Party
B
that occurs subsequent to the Specific Event.
|
(iii)
|
Change
of Account.
Section 2(b) is hereby amended by the addition of the following
after the
word “delivery” in the first line
thereof:
|
“to
another account in the same legal and tax jurisdiction as the original
account”.
|
(iv)
|
Representations.
Section 3 is hereby amended by adding at the end thereof the following
subsection (g):
|
|
“(g)
|
Relationship
Between Parties.
|
|
(1)
|
Nonreliance.
(i) It is not relying on any statement or representation of the
other
party regarding the Transaction (whether written or oral), other
than the
representations expressly made in this Agreement or the Confirmation
in
respect of that Transaction and (ii) it has consulted with its
own legal,
regulatory, tax, business, investment, financial and accounting
advisors
to the extent it has deemed necessary, and it has made its own
investment,
hedging and trading decisions based upon its own judgment and upon
any
advice from such advisors as it has deemed necessary and not upon
any view
expressed by the other party.
|
|
(2)
|
Evaluation
and Understanding. (i) It has the capacity to evaluate (internally
or
through independent professional advice) the Transaction and has
made its
own decision to enter into the Transaction and (ii) It understands
the
terms, conditions and risks of the Transaction and is willing and
able to
accept those terms and conditions and to assume those risks, financially
and otherwise.
|
|
(3)
|
Purpose.
It is entering into the Transaction for the purposes of managing
its
borrowings or investments, hedging its underlying assets or liabilities
or
in connection with a line of business.
|
|
(4)
|
Status
of Parties. The other party is not acting as an agent, fiduciary
or
advisor for it in respect of the Transaction.
|
|
(5)
|
Eligible
Contract Participant. It is an “eligible swap participant” as such term is
defined in, Section 35.1(b)(2) of the regulations (17 C.F.R. 35)
promulgated under, and an “eligible contract participant” as defined in
Section 1(a)(12) of the Commodity Exchange Act, as
amended.”
|
|
(v)
|
Transfer
to Avoid Termination Event.
Section 6(b)(ii) is hereby amended by (i) deleting the words “or if a Tax
Event Upon Merger occurs and the Burdened Party is the Affected
Party,”
and (ii) by deleting the words “to transfer” and inserting the words “to
effect a Permitted Transfer” in lieu
thereof.
|
|
(vi)
|
Jurisdiction.
Section
13(b) is hereby amended by: (i) deleting in the second line of
subparagraph (i) thereof the word "non-", (ii) deleting “; and” from the
end of subparagraph (i) and inserting “.” in lieu thereof, and (iii)
deleting the final paragraph
thereof.
|
|
(vii)
|
Local
Business Day.
The definition of Local Business Day in Section 14 is hereby amended
by
the addition of the words “or any Credit Support Document” after “Section
2(a)(i)” and the addition of the words “or Credit Support Document” after
“Confirmation”.
|
|
(c)
|
Additional
Termination Events.
The following Additional Termination Events will
apply:
|
| (i) |
First
Rating Trigger Collateral.
If
(A) it is not the case that a Xxxxx’x Second Trigger Ratings Event has
occurred and been continuing for 30 or more Local Business Days and
(B)
Party
A has failed to comply with or perform any obligation to be complied
with
or performed by Party A in accordance with the Credit Support Annex,
then
an Additional Termination Event shall have occurred with respect
to Party
A and Party A shall be the sole Affected Party with respect to such
Additional Termination Event.
|
| (ii) |
Second
Rating Trigger Replacement.
If
(A) a Required Ratings Downgrade Event has occurred and been continuing
for 30 or more Local Business Days and (B) (i) at least one Eligible
Replacement has made a Firm Offer to be the transferee of all of
Party A’s
rights and obligations under this Agreement (and such Firm Offer
remains
an offer that will become legally binding upon such Eligible Replacement
upon acceptance by the offeree) and/or (ii) an Eligible Guarantor
has made
a Firm Offer to provide an Eligible Guarantee (and such Firm Offer
remains
an offer that will become legally binding upon such Eligible Guarantor
immediately upon acceptance by the offeree), then an Additional
Termination Event shall have occurred with respect to Party A and
Party A
shall be the sole Affected Party with respect to such Additional
Termination Event.
|
|
(iii)
|
Optional
Termination of Securitization.
An
Additional Termination Event shall occur upon the notice to
Certificateholders of an Optional Termination becoming unrescindable
in
accordance with Article X of the Pooling and Servicing Agreement
(such
notice, the “Optional
Termination Notice”).
With respect to such Additional Termination Event: (A) Party B
shall be
the sole Affected Party; (B) notwithstanding anything to the contrary
in
Section 6(b)(iv) or Section 6(c)(i), the final Distribution Date
specified
in the Optional Termination Notice is hereby designated as the
Early
Termination Date for this Additional Termination Event in respect
of all
Affected Transactions; (C) Section 2(a)(iii)(2) shall not be applicable
to
any Affected Transaction in
connection with the Early Termination Date resulting from this
Additional
Termination Event; notwithstanding anything to the contrary in
Section
6(c)(ii), payments and deliveries under Section 2(a)(i) or Section
2(e) in
respect of the Terminated Transactions resulting from this Additional
Termination Event will be required to be made through and including
the
Early Termination Date designated
as a result of this Additional Termination Event; provided, for
the
avoidance of doubt, that any such payments or deliveries that are
made on
or prior to such Early Termination Date will not be treated as
Unpaid
Amounts in determining the amount payable in respect of such Early
Termination Date; (D) notwithstanding anything to the contrary
in Section
6(d)(i), (I) if, on the day that is four Business Days prior to
the final
Distribution Date specified in the Optional Termination Notice,
no later
than 4:00 pm New York City time the Trustee requests the amount
of the
Estimated Swap Termination Payment, Party A shall provide to the
Trustee
in writing (which may be done in electronic format) the amount
of the
Estimated Swap Termination Payment no later than 2:00 pm New York
City
time on the following Business Day and (II) if the Trustee provides
written notice (which may be done in electronic format) to Party
A no
later than two Business Days prior to the final Distribution Date
specified in the Optional Termination Notice that all requirements
of the
Optional Termination have been met, then Party A shall, no later
than one
Business Day prior to the final Distribution Date specified in
the
Optional Termination Notice, make the calculations contemplated
by Section
6(e) of the ISDA Master Agreement (as amended herein) and provide
to the
Trustee in writing (which may be done in electronic format) the
amount
payable by either Party B or Party A in respect of the related
Early
Termination Date in
connection with this Additional Termination Event; provided, however,
that
the amount payable by Party B, if any, in respect of the related
Early
Termination Date shall be the lesser of (x) the amount calculated
to be
due by Party B pursuant to Section 6(e) and (y) the Estimated Swap
Termination Payment; and (E) notwithstanding anything to the contrary
in
this Agreement, any amount due from Party B to Party A in respect
of this
Additional Termination Event will be payable on the final Distribution
Date specified in the Optional Termination Notice and any amount
due from
Party A to Party B in respect of this Additional Termination Event
will be
payable one Business Day prior to the final Distribution Date specified
in
the Optional Termination Notice.
|
The
Trustee shall be an express third party beneficiary of this Agreement as
if a
party hereto to the extent of the Trustee’s rights specified herein.
|
(iv)
|
Amendment
of Pooling and Servicing Agreement.
If, without the prior written consent of Party A where such consent
is
required under the Pooling and Servicing Agreement (such consent
not to be
unreasonably withheld), an amendment is made to the Pooling and
Servicing
Agreement (excluding, for the avoidance of doubt, any amendment
to the
Pooling and Servicing Agreement that is entered into solely for
the
purpose of appointing a successor servicer, master servicer, securities
administrator, trustee or other service provider), an Additional
Termination Event shall have occurred with respect to Party B and
Party B
shall be the sole Affected Party with respect to such Additional
Termination Event.
|
|
(iv)
|
Information
Required by Regulation AB. If
Party A fails to comply with the provisions of Part 5(e) upon the
occurrence of a Swap Disclosure Event, then an Additional Termination
Event shall have occurred with respect to Party A and Party A shall
be the
sole Affected Party with respect to such Additional Termination
Event.
|
|
(d)
|
Required
Ratings Downgrade Event.
In
the event that no Relevant Entity has credit ratings at least equal
to the
Required Ratings Threshold (such event, a “Required
Ratings Downgrade Event”),
then Party A shall, as soon as reasonably practicable and so long
as a
Required Ratings Downgrade Event is in effect, at its own expense,
using
commercially reasonable efforts, procure either (A) a Permitted
Transfer
or (B) an Eligible Guarantee.
|
|
(e)
|
Compliance
with Regulation AB. (i)
For purposes of Item 1115 of Subpart 229.1100 - Asset Backed Securities
(Regulation AB) (17 C.F.R. ss.ss.229.1100 - 229.1123) (“Regulation AB”)
under the Securities Act of 1933, as amended, and the Securities
Exchange
Act of 1934, as amended (the “Exchange Act”), as amended and interpreted
by the Securities and Exchange Commission and its staff, if the
Depositor
or Party B makes a determination, acting reasonably and in good
faith,
that (x) the applicable “significance percentage” with respect to this
Agreement has been reached, and (y) it has a reporting obligation
under
the Exchange Act (a “Swap Disclosure Event”), then Party A shall (or shall
cause its Credit Support Provider to), within ten (10) calendar
days after
notice to that effect, at its sole expense, take one of the following
actions (each subject to satisfaction of the Rating Agency Condition):
(1)
provide (including, if permitted by Regulation AB, provision by
reference
to reports filed pursuant to the Exchange Act or otherwise publicly
available information): (A) the financial data required by Item
301 of
Regulation S-K (17 C.F.R. §229.301), pursuant to Item 1115(b)(1); (B)
financial statements meeting the requirements of Regulation S-X
(17 C.F.R.
§§210.1-01 through 210.12-29, but excluding 17 C.F.R. ss. 210.3-05
and
Article 11 of Regulation S-X (17 C.F.R. ss. ss. 210.11-01 through
210.11-03)), pursuant to Item 1115(b)(2); or (C) such other financial
information as may at the time be required or permitted to be provided
in
satisfaction of the requirements of Item 1115(b), together with
accountants consents and/or a procedure letter relating thereto;
or (2)
secure an Approved Replacement that is able to comply with the
requirements of Item 1115(b) of Regulation AB to replace Party
A as party
to this Agreement, on substantially similar terms, the debt rating
of
which entity (or credit support provider therefor) meets or exceeds
the
applicable requirements of the applicable Rating
Agencies.
|
(ii)
For
so long as the aggregate significance percentage is 10% or more, Party A
shall
(or shall cause its Credit Support Provider to) provide any updates to the
information provided pursuant to clause (i)(1) above to the Depositor within
five (5) Business Days following availability thereof (but in no event more
than
45 days after the end of each of Party A’s Credit Support Provider’s fiscal half
for any half-year update, and in no event more than 90 days after the end
of
each of Party A’s Credit Support Provider’s fiscal year for any annual
update).
(iii)
All
information provided pursuant to clauses (i)(1) and (ii) above (all such
information, “Swap Financial Disclosure”) shall be in a form suitable for
conversion to the format required for filing by the Depositor with the
Commission via the Electronic Data Gathering and Retrieval System (XXXXX).
In
addition, any such information, if audited, shall be accompanied by any
necessary auditor’s consents or, if such information is unaudited, shall be
accompanied by an appropriate agreed-upon procedures letter from Party A’s
accountants. If permitted by Regulation AB, any such information may be provided
by reference to or incorporation by reference from reports filed pursuant
to the
Exchange Act.
(iv)
Party A agrees that, in the event that Party A provides Swap Financial
Disclosure to Depositor in accordance with paragraph (iii) above or causes
its
Credit Support Provider to provide Swap Financial Disclosure to Depositor
in
accordance with paragraph (iii) above, it will indemnify and hold harmless
Depositor, its respective directors or officers and any person controlling
Depositor, from and against any and all losses, claims, damages and liabilities
(any “Damage”) caused by any untrue statement or alleged untrue statement of a
material fact contained in such Swap Financial Disclosure or caused by any
omission or alleged omission to state in such Swap Financial Disclosure a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading; provided, however that the foregoing shall not apply to any Damage
caused by the negligence or any willful action of Depositor or any other
party
(other than Party A or any of its affiliates or any of their respective agents),
including without limitation any failure to calculate the Significance
Percentage according to the terms of this Agreement or to make any filing
as and
when required under Regulation AB.
(v)
Third
Party Beneficiary. The Depositor shall be an express third party beneficiary
of
this Agreement as if a party hereto to the extent of the Depositor’s rights
explicitly specified in this Part 5(e).
|
(f)
|
Transfers.
|
(i) Section
7
is hereby amended to read in its entirety as follows:
“Except
with respect to any Permitted Transfer pursuant to Section 6(b)(ii), Part
5(d),
or the succeeding sentence, neither Party A nor Party B is permitted to assign,
novate or transfer (whether by way of security or otherwise) as a whole or
in
part any of its rights, obligations or interests under the Agreement or any
Transaction unless (a) the prior written consent of the other party is obtained,
and (b) the Rating Agency Condition has been satisfied with respect to S&P.
At any time at which no Relevant Entity has credit ratings at least equal
to the
Approved Ratings Threshold, Party A may make a Permitted Transfer.”
|
(ii)
|
If
an Eligible Replacement has made a Firm Offer (which remains an
offer that
will become legally binding upon acceptance by Party B) to be the
transferee pursuant to a Permitted Transfer, Party B shall, at
Party A’s
written request and at Party A’s expense, take any reasonable steps
required to be taken by Party B to effect such transfer.
|
|
(g)
|
Non-Recourse.
Party A acknowledges and agree that, notwithstanding any provision
in this
Agreement to the contrary, the obligations of Party B hereunder
are
limited recourse obligations of Party B, payable solely , in accordance
with the priority of payments and other terms of the Pooling and
Servicing
Agreement and that Party A will not have any recourse to any of
the
directors, officers, employees, shareholders or affiliates of the
Party B
with respect to any claims, losses, damages, liabilities, indemnities
or
other obligations in connection with any transactions contemplated
hereby.
This provision will survive the termination of this
Agreement.
|
|
(h)
|
Timing
of Payments
by Party B upon Early Termination.
Notwithstanding anything to the contrary in Section 6(d)(ii), to
the
extent that all or a portion (in either case, the “Unfunded Amount”) of
any amount that is calculated as being due in respect of any Early
Termination Date under Section 6(e) from Party B to Party A will
be paid
by Party B from amounts other than any upfront payment paid to
Party B by
an Eligible Replacement that has entered a Replacement Transaction
with
Party B, then such Unfunded Amount shall be due on the Distribution
Date
immediately following the date on which the payment would have
been
payable as determined in accordance with Section 6(d)(ii), and
on any
subsequent Distribution Dates until paid in full (or if such Early
Termination Date is the final Distribution Date, on such final
Distribution Date); provided, however, that if the date on which
the
payment would have been payable as determined in accordance with
Section
6(d)(ii) is a Distribution Date, such payment will be payable on
such
Distribution Date.
|
|
(i)
|
Rating
Agency Notifications. Notwithstanding
any other provision of this Agreement, no Early Termination Date
shall be
effectively designated hereunder by Party B and no transfer of
any rights
or obligations under this Agreement shall be made by either party
unless
each Swap Rating Agency has been given prior written notice of
such
designation or transfer.
|
|
(j)
|
No
Set-off.
Except as expressly provided for in Section 2(c), Section 6 or
Part
1(f)(i)(D) hereof, and notwithstanding any other provision of this
Agreement or any other existing or future agreement, each party
irrevocably waives any and all rights it may have to set off, net,
recoup
or otherwise withhold or suspend or condition payment or performance
of
any obligation between it and the other party hereunder against
any
obligation between it and the other party under any other agreements.
Section 6(e) shall be amended by deleting the following sentence:
“The
amount, if any, payable in respect of an Early Termination Date
and
determined pursuant to this Section will be subject to any
Set-off.”
|
|
(k)
|
Amendment.
Notwithstanding any provision to the contrary in this Agreement,
no
amendment of either this Agreement or any Transaction under this
Agreement
shall be permitted by either party unless each of the Swap Rating
Agencies
has been provided prior written notice of the same and such amendment
satisfies the Rating Agency Condition with respect to
S&P.
|
|
(l)
|
Notice
of Certain Events or Circumstances.
Each Party agrees, upon learning of the occurrence or existence
of any
event or condition that constitutes (or that with the giving of
notice or
passage of time or both would constitute) an Event of Default or
Termination Event with respect to such party, promptly to give
the other
Party and to each Swap Rating Agency notice of such event or condition;
provided that failure to provide notice of such event or condition
pursuant to this Part 5(l) shall not constitute an Event of Default
or a
Termination Event.
|
(m) Proceedings.
No
Relevant Entity shall institute against, or cause any other person to institute
against, or join any other person in instituting against Party B, the
Supplemental Interest Trust, or the trust formed pursuant to the Pooling
and
Servicing Agreement, any bankruptcy, reorganization, arrangement, insolvency
or
liquidation proceedings or other proceedings under any federal or state
bankruptcy or similar law for a period of one year (or, if longer, the
applicable preference period) and one day following payment in full of the
Certificates and any Notes. This provision will survive the termination of
this
Agreement.
|
(n)
|
Supplemental
Interest Trust Trustee Limitation of Liability. It
is expressly understood and agreed by the parties hereto that (a)
this
Agreement is executed and delivered by HSBC Bank USA, National
Association, not individually or personally but solely as the Supplemental
Interest Trust Trustee, in the exercise of the powers and authority
conferred and vested in it under the Pooling and Servicing Agreement,
(b)
the representations, warranties, covenants, undertakings and agreements
herein made on the part of the Supplemental Interest Trust are
made and
intended not as personal representations, undertakings and agreements
by
HSBC Bank USA, National Association but are made and intended for
the
purpose of binding only the Supplemental Interest Trust, (c) nothing
herein contained shall be construed as creating any liability on
HSBC Bank
USA, National Association, individually or personally, to perform
any
covenant either expressed or implied contained herein, all such
liability,
if any, being expressly waived by the parties who are signatories
to this
Agreement and by any person claiming by, through or under such
parties and
(d) under no circumstances shall HSBC Bank USA, National Association
be
personally liable for the payment of any indemnity, indebtedness,
fees or
expenses of the Supplemental Interest Trust or be liable for the
breach or
failure of any obligation, representation, warranty or covenant
made or
undertaken by the Supplemental Interest Trust under this
Agreement.
|
|
(o)
|
Severability.
If
any term, provision, covenant, or condition of this Agreement,
or the
application thereof to any party or circumstance, shall be held
to be
invalid or unenforceable (in whole or in part) in any respect,
the
remaining terms, provisions, covenants, and conditions hereof shall
continue in full force and effect as if this Agreement had been
executed
with the invalid or unenforceable portion eliminated, so long as
this
Agreement as so modified continues to express, without material
change,
the original intentions of the parties as to the subject matter
of this
Agreement and the deletion of such portion of this Agreement will
not
substantially impair the respective benefits or expectations of
the
parties; provided, however, that this severability provision shall
not be
applicable if any provision of Section 2, 5, 6, or 13 (or any definition
or provision in Section 14 to the extent it relates to, or is used
in or
in connection with any such Section) shall be so held to be invalid
or
unenforceable.
|
The
parties shall endeavor to engage in good faith negotiations to replace any
invalid or unenforceable term, provision, covenant or condition with a valid
or
enforceable term, provision, covenant or condition, the economic effect of
which
comes as close as possible to that of the invalid or unenforceable term,
provision, covenant or condition.
|
(p)
|
Party
A acknowledges that the Supplemental Interest Trust Trustee and
the
Securities Administrator have been appointed as agents under the
Pooling
and Servicing Agreement to carry out certain functions on behalf
of Party
B, and that the Supplemental Interest Trust Trustee and the Securities
Administrator shall be entitled to give notices and to perform
and satisfy
the obligations of Party B hereunder on behalf of Party
B.
|
|
(q)
|
Escrow
Payments.
If
(whether by reason of the time difference between the cities in
which
payments are to be made or otherwise) it is not possible for simultaneous
payments to be made on any date on which both parties are required
to make
payments hereunder, either Party may at its option and in its sole
discretion notify the other Party that payments on that date are
to be
made in escrow. In this case deposit of the payment due earlier
on that
date shall be made by 2:00 pm (local time at the place for the
earlier
payment) on that date with an escrow agent selected by the notifying
party, accompanied by irrevocable payment instructions (i) to release
the
deposited payment to the intended recipient upon receipt by the
escrow
agent of the required deposit of any corresponding payment payable
by the
other party on the same date accompanied by irrevocable payment
instructions to the same effect or (ii) if the required deposit
of the
corresponding payment is not made on that same date, to return
the payment
deposited to the party that paid it into escrow. The party that
elects to
have payments made in escrow shall pay all costs of the escrow
arrangements.
|
|
(r)
|
Consent
to Recording.
Each party hereto consents to the monitoring or recording, at any
time and
from time to time, by the other party of any and all communications
between trading, marketing, and operations personnel of the parties
and
their Affiliates, waives any further notice of such monitoring
or
recording, and agrees to notify such personnel of such monitoring
or
recording.
|
|
(s)
|
Waiver
of Jury Trial.
Each party waives any right it may have to a trial by jury in respect
of
any in respect of any suit, action or proceeding relating to this
Agreement or any Credit Support Document.
|
|
(t)
|
Form
of ISDA Master Agreement. Party
A and Party B hereby agree that the text of the body of the ISDA
Master
Agreement is intended to be the printed form of the ISDA Master
Agreement
(Multicurrency - Crossborder) as published and copyrighted in 1992
by the
International Swaps and Derivatives Association,
Inc.
|
|
(u)
|
Payment
Instructions.
Party A hereby agrees that, unless notified in writing by Party
B of other
payment instructions, any and all amounts payable by Party A to
Party B
under this Agreement shall be paid to the account specified in
Item 4 of
this Confirmation, below.
|
|
(v)
|
Additional
representations.
|
|
(i)
|
Representations
of Party A.
Party A represents to Party B on the date on which Party A enters
into
each Transaction that:--
|
|
(1)
|
Party
A’s obligations under this Agreement rank pari passu with all of
Party A’s
other unsecured, unsubordinated obligations except those obligations
preferred by operation of law.
|
|
(2)
|
Party
A is a bank subject to the requirements of 12 U.S.C. § 1823(e), its
execution, delivery and performance of this Agreement (including
the
Credit Support Annex and each Confirmation) have been approved
by its
board of directors or its loan committee, such approval is reflected
in
the minutes of said board of directors or loan committee, and this
Agreement (including the Credit Support Annex and each Confirmation)
will
be maintained as one of its official records continuously from
the time of
its execution (or in the case of any Confirmation, continuously
until such
time as the relevant Transaction matures and the obligations therefor
are
satisfied in full).
|
|
(ii)
|
Capacity.
Party A represents to Party B on the date on which Party A enters
into
this Agreement that it is entering into the Agreement and the Transaction
as principal and not as agent of any person. The Supplemental Interest
Trust Trustee represents to Party A on the date on which the Supplemental
Interest Trust Trustee executes this Agreement that it is executing
the
Agreement in its capacity as Supplemental Interest Trust
Trustee.
|
|
(w)
|
Acknowledgements.
|
|
(ii)
|
Bankruptcy
Code.
Subject to Part 5(m), without limiting the applicability if any,
of any
other provision of the U.S. Bankruptcy Code as amended (the “Bankruptcy
Code”) (including without limitation Sections 362, 546, 556, and 560
thereof and the applicable definitions in Section 101 thereof),
the
parties acknowledge and agree that all Transactions entered into
hereunder
will constitute “forward contracts” or “swap agreements” as defined in
Section 101 of the Bankruptcy Code or “commodity contracts” as defined in
Section 761 of the Bankruptcy Code, that the rights of the parties
under
Section 6 of this Agreement will constitute contractual rights
to
liquidate Transactions, that any margin or collateral provided
under any
margin, collateral, security, pledge, or similar agreement related
hereto
will constitute a “margin payment” as defined in Section 101 of the
Bankruptcy Code, and that the parties are entities entitled to
the rights
under, and protections afforded by, Sections 362, 546, 556, and
560 of the
Bankruptcy Code.
|
|
(x)
|
[Reserved]
|
|
(y)
|
Third
Party Beneficiary.
Xxxxx Fargo Bank, N.A. is a third party beneficiary of this agreement
and
is entitled to the rights and benefits hereunder and may enforce
the
provisions hereof as if were a party
hereto.
|
(z) Additional
Definitions.
As
used
in this Agreement, the following terms shall have the meanings set forth
below,
unless the context clearly requires otherwise:
“Approved
Ratings Threshold”
means
each of the S&P Approved Ratings Threshold, the Moody’s First Trigger
Ratings Threshold and the DBRS Approved Ratings Threshold.
“Approved
Replacement” means,
with respect to a Market Quotation, an entity making such Market Quotation,
which entity would satisfy conditions (a), (b), (c) and (d) of the definition
of
Permitted Transfer (as determined by Party B in its sole discretion, acting
in a
commercially reasonable manner) if such entity were a Transferee, as defined
in
the definition of Permitted Transfer.
“DBRS”
means
Dominion Bond Rating Service, or any successor thereto.
“DBRS
Approved Ratings Threshold” means,
with respect to Party A, the guarantor under an Eligible Guarantee, or an
Eligible Replacement, a long-term unsecured and unsubordinated debt rating
from
DBRS of “AA(low)” and a short-term unsecured and unsubordinated debt rating from
DBRS of “R-1(middle)”.
“DBRS
Required Ratings Threshold” means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, a
long-term unsecured and unsubordinated debt rating from DBRS of
“BBB”.
“Derivative
Provider Trigger Event”
means
(i) an Event of Default with respect to which Party A is a Defaulting Party,
(ii) a Termination Event with respect to which Party A is the sole Affected
Party or (iii) an Additional Termination Event with respect to which Party
A is
the sole Affected Party.
“Eligible
Guarantee”
means an
unconditional and irrevocable guarantee of all present and future obligations
(for the avoidance of doubt, not limited to payment obligations) of Party
A or
an Eligible Replacement to Party B under this Agreement that is provided
by an
Eligible Guarantor as principal debtor rather than surety and that is directly
enforceable by Party B, the form and substance of which guarantee are subject
to
the Rating Agency Condition with respect to S&P, and either (A) a law firm
has given a legal opinion confirming that none of the guarantor’s payments to
Party B under such guarantee will be subject to Tax
collected by withholding or
(B)
such guarantee provides that, in the event that any of such guarantor’s payments
to Party B are subject to Tax collected by withholding, such guarantor is
required to pay such additional amount as is necessary to ensure that the
net
amount actually received by Party B (free and clear of any Tax collected
by
withholding) will equal the full amount Party B would have received had no
such
withholding been required.
“Eligible
Guarantor” means
an
entity that (A) has credit ratings at least equal to the S&P Approved
Ratings Threshold and the DBRS
Approved Ratings Threshold and (B) has credit ratings from Moody’s at least
equal to the Moody’s Second Trigger Ratings Threshold, provided, for the
avoidance of doubt, that an Eligible Guarantee of an Eligible Guarantor with
credit ratings below the Moody’s First Trigger Ratings Threshold will not cause
a Collateral Event (as defined in the Credit Support Annex) not to occur
or
continue with respect to Moody’s.
“Eligible
Replacement”
means an
entity (i) (a) that has credit ratings at least equal to the S&P Approved
Ratings Threshold and the DBRS
Approved Ratings Threshold, and (b) has credit ratings from Moody’s at least
equal to the Moody’s Second Trigger Ratings Threshold, provided, for the
avoidance of doubt, that an Eligible Replacement with credit ratings below
the
Moody’s First Trigger Ratings Threshold will not cause a Collateral Event (as
defined in the Credit Support Annex) not to occur or continue with respect
to
Moody’s, or (ii) the present and future obligations (for the avoidance of doubt,
not limited to payment obligations) of which entity to Party B under this
Agreement are guaranteed pursuant to an Eligible Guarantee.
“Estimated
Swap Termination Payment”
means,
with respect to an Early Termination Date, an amount determined by Party
A in
good faith and in a commercially reasonable manner as the maximum payment
that
could be owed by Party B to Party A in respect of such Early Termination
Date
pursuant to Section 6(e) of the ISDA Master Agreement, taking into account
then
current market conditions.
“Firm
Offer”
means
(A) with respect to an Eligible Replacement, a quotation from such Eligible
Replacement (i) in an amount equal to the actual amount payable by or to
Party B
in consideration of an agreement between Party B and such Eligible Replacement
to replace Party A as the counterparty to this Agreement by way of novation
or,
if such novation is not possible, an agreement between Party B and such Eligible
Replacement to enter into a Replacement Transaction (assuming that all
Transactions hereunder become Terminated Transactions), and (ii) that
constitutes an offer by such Eligible Replacement to replace Party A as the
counterparty to this Agreement or enter a Replacement Transaction that will
become legally binding upon such Eligible Replacement upon acceptance by
Party
B, and (B) with respect to an Eligible Guarantor, an offer by such Eligible
Guarantor to provide an Eligible Guarantee that will become legally binding
upon
such Eligible Guarantor upon acceptance by the offeree.
“Moody’s”
means
Xxxxx’x Investors Service, Inc., or any successor thereto.
“Moody’s
Second Trigger Ratings Event”
means
that no Relevant Entity has credit ratings from Moody’s at least equal to the
Moody’s Second Trigger Ratings Threshold.
“Permitted
Transfer” means
a
transfer by novation by Party A pursuant to Section 6(b)(ii), Part 5(d),
or the
second sentence of Section 7 (as amended herein) to a transferee (the
“Transferee”)
of all,
but not less than all, of Party A’s rights, liabilities, duties and obligations
under this Agreement, with
respect to which transfer each of the following conditions is
satisfied:
(a) the
Transferee is an Eligible Replacement; (b) Party A and the Transferee are
both
“dealers in notional principal contracts” within the meaning of Treasury
regulations section 1.1001-4; (c) as of the date of such transfer the Transferee
would not be required to withhold or deduct on account of Tax from any payments
under this Agreement or would be required to gross up for such Tax under
Section
2(d)(i)(4); (d) an Event of Default or Termination Event would not occur
as a
result of such transfer; (e) pursuant to a written instrument (the “Transfer
Agreement”),
the
Transferee acquires and assumes all rights and obligations of Party A under
the
Agreement and the relevant Transaction; (f) Party B shall have determined,
in
its sole discretion, acting in a commercially reasonable manner, that such
Transfer Agreement is effective to transfer to the Transferee all, but not
less
than all, of Party A’s rights and obligations under the Agreement and all
relevant Transactions; (g) Party A will be responsible for any costs or expenses
incurred in connection with such transfer (including any replacement cost
of
entering into a replacement transaction); (h) either (A) Moody’s has been given
prior written notice of such transfer and the Rating Agency Condition is
satisfied with respect to S&P or (B) each Swap Rating Agency has been given
prior written notice of such transfer and such transfer is in connection
with
the assignment and assumption of this Agreement without modification of its
terms, other than party names, dates relevant to the effective date of such
transfer, tax representations (provided that the representations in Part
2(a)(i)
are not modified) and any other representations regarding the status of the
substitute counterparty of the type included in Part 5(b)(iv), Part 5(v)(i)(2)
or Part 5(v)(ii), notice information and account details and such transfer
otherwise complies with the terms of the Pooling and Servicing
Agreement.
“Rating
Agency Condition”
means,
with respect to any particular proposed act or omission to act hereunder
and
each Swap Rating Agency specified in connection with such proposed act or
omission, that the party acting or failing to act must consult with each
of the
specified Swap Rating Agencies and receive from each such Swap Rating Agency
a
prior written confirmation that the proposed action or inaction would not
cause
a downgrade or withdrawal of the then-current rating of any Certificates
or
Notes.
“Relevant
Entity” means
Party A and, to the extent applicable, a guarantor under an Eligible
Guarantee.
“Replacement
Transaction”
means,
with respect to any Terminated Transaction or group of Terminated Transactions,
a transaction or group of transactions that (i) would have the effect of
preserving for Party B the economic equivalent of any payment or delivery
(whether the underlying obligation was absolute or contingent and assuming
the
satisfaction of each applicable condition precedent) by the parties under
Section 2(a)(i) in respect of such Terminated Transaction or group of Terminated
Transactions that would, but for the occurrence of the relevant Early
Termination Date, have been required after that Date, and (ii) has terms
which
are substantially the same as this Agreement, including, without limitation,
rating triggers, Regulation AB compliance, and credit support documentation,
save for the exclusion of provisions relating to Transactions that are not
Terminated Transaction, as determined by Party B in its sole discretion,
acting
in a commercially reasonable manner.
“Required
Ratings Downgrade Event”
shall
have the meaning assigned thereto in Part 5(d).
“Required
Ratings Threshold” means
each of the S&P Required Ratings Threshold, the Moody’s Second Trigger
Ratings Threshold and the DBRS Required Ratings Threshold.
“S&P”
means
Standard & Poor's Rating Services, a division of The XxXxxx-Xxxx Companies,
Inc., or any successor thereto.
“S&P
Required Ratings Threshold”
means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, a long-term unsecured and unsubordinated debt rating
from
S&P of “BBB+”.
“Swap
Rating Agencies”
means,
with respect to any date of determination, each of Moody’s,
DBRS
and
S&P,
to the
extent that each such rating agency is then providing a rating for any of
the
Nomura
Home Equity Loan, Inc., Home Equity Loan Trust, Series 2007-2 (the
“Certificates”) or any notes backed by the Certificates (the
“Notes”).
[Remainder
of this page intentionally left blank.]
4. Account
Details and Settlement Information:
|
Payments
to Party A:
|
HSBC
Bank USA, National Association
ABA
# 000-000-000
For
credit to Department 299
A/C:
000-00000-0
HSBC
Derivative Products Group
|
|
Payments
to Party B:
|
Xxxxx
Fargo Bank, N.A.
ABA
# 000-000-000
For
Credit to: SAS Clearing
A/C:
0000000000
FFC:
NHEL 2007-2, Supplemental Interest Trust,
#50984601
|
This
Agreement may be executed in several counterparts, each of which shall be
deemed
an original but all of which together shall constitute one and the same
instrument.
We
are
very pleased to have executed this Transaction with you and we look forward
to
completing other transactions with you in the near future.
|
Very
truly yours,
|
|||||||||||||
|
HSBC
BANK USA, NATIONAL ASSOCIATION
|
|||||||||||||
|
By:
|
/s/
Xxxxxxx Xxxxxxxx
|
||||||||||||
|
Name:
|
Xxxxxxx
Xxxxxxxx
|
||||||||||||
|
Title:
|
Assistant
Vice President
|
||||||||||||
|
By:
|
/s/
Xxxxxxxx Xxxxxxx
|
||
|
Name:
|
Xxxxxxxx
Xxxxxxx
|
||
|
Title:
|
Vice
President
|
Party
B,
acting through its duly authorized signatory, hereby agrees to, accepts and
confirms the terms of the foregoing as of the date hereof.
HSBC
BANK
USA, NATIONAL ASSOCIATION, NOT INDIVIDUALLY, BUT SOLELY AS SUPPLEMENTAL INTEREST
TRUST TRUSTEE ON BEHALF OF THE SUPPLEMENTAL INTEREST TRUST WITH RESPECT TO
THE
NOMURA HOME EQUITY LOAN, INC., HOME EQUITY LOAN TRUST, SERIES
2007-2
|
By:
|
/s/
Xxxxx Xxxxx
|
||
|
Name:
|
Xxxxx
Xxxxx
|
||
|
Title:
|
Assistant
Vice President
|
SCHEDULE
I
All
such
dates subject to No Adjustment with respect to Fixed Rate Payer Period End
Dates
and adjustment in accordance with the Following Business Day Convention with
respect to Floating Rate Payer Period End Dates
|
For
the Calculation Periods
|
Notional
Amount
|
|
|
From
and including:
|
To
but excluding:
|
in
USD:
|
|
The
Effective Date
|
August
25, 2007
|
735,838,000.00
|
|
August
25, 2007
|
September
25, 2007
|
704,527,000.00
|
|
September
25, 2007
|
October
25, 2007
|
673,488,000.00
|
|
October
25, 2007
|
November
25, 2007
|
642,956,000.00
|
|
November
25, 2007
|
December
25, 2007
|
612,989,000.00
|
|
December
25, 2007
|
January
25, 2008
|
584,192,000.00
|
|
January
25, 2008
|
February
25, 2008
|
556,629,000.00
|
|
February
25, 2008
|
March
25, 2008
|
530,294,000.00
|
|
March
25, 2008
|
April
25, 2008
|
505,095,000.00
|
|
April
25, 2008
|
May
25, 2008
|
481,050,000.00
|
|
May
25, 2008
|
June
25, 2008
|
457,578,000.00
|
|
June
25, 2008
|
July
25, 2008
|
432,707,000.00
|
|
July
25, 2008
|
August
25, 2008
|
377,933,000.00
|
|
August
25, 2008
|
September
25, 2008
|
286,161,000.00
|
|
September
25, 2008
|
October
25, 2008
|
256,646,000.00
|
|
October
25, 2008
|
November
25, 2008
|
239,998,000.00
|
|
November
25, 2008
|
December
25, 2008
|
159,803,000.00
|
|
December
25, 2008
|
January
25, 2009
|
141,158,000.00
|
|
January
25, 2009
|
February
25, 2009
|
133,697,000.00
|
|
February
25, 2009
|
March
25, 2009
|
126,960,000.00
|
|
March
25, 2009
|
April
25, 2009
|
120,765,000.00
|
|
April
25, 2009
|
May
25, 2009
|
115,420,000.00
|
|
May
25, 2009
|
June
25, 2009
|
110,212,000.00
|
|
June
25, 2009
|
July
25, 2009
|
105,227,000.00
|
|
July
25, 2009
|
August
25, 2009
|
96,463,000.00
|
|
August
25, 2009
|
September
25, 2009
|
86,543,000.00
|
|
September
25, 2009
|
October
25, 2009
|
81,417,000.00
|
|
October
25, 2009
|
November
25, 2009
|
77,422,000.00
|
|
November
25, 2009
|
December
25, 2009
|
71,054,000.00
|
|
December
25, 2009
|
January
25, 2010
|
66,762,000.00
|
|
January
25, 2010
|
February
25, 2010
|
64,216,000.00
|
|
February
25, 2010
|
March
25, 2010
|
61,768,000.00
|
|
March
25, 2010
|
April
25, 2010
|
59,414,000.00
|
|
April
25, 2010
|
May
25, 2010
|
57,150,000.00
|
|
May
25, 2010
|
June
25, 2010
|
54,973,000.00
|
|
June
25, 2010
|
July
25, 2010
|
52,879,000.00
|
|
July
25, 2010
|
August
25, 2010
|
50,866,000.00
|
|
August
25, 2010
|
September
25, 2010
|
48,929,000.00
|
|
September
25, 2010
|
October
25, 2010
|
47,067,000.00
|
|
October
25, 2010
|
November
25, 2010
|
45,276,000.00
|
|
November
25, 2010
|
December
25, 2010
|
43,540,000.00
|
|
December
25, 2010
|
January
25, 2011
|
41,884,000.00
|
|
January
25, 2011
|
February
25, 2011
|
40,291,000.00
|
|
February
25, 2011
|
March
25, 2011
|
38,736,000.00
|
|
March
25, 2011
|
April
25, 2011
|
37,264,000.00
|
|
April
25, 2011
|
May
25, 2011
|
35,848,000.00
|
|
May
25, 2011
|
June
25, 2011
|
34,439,000.00
|
|
June
25, 2011
|
July
25, 2011
|
33,070,000.00
|
|
July
25, 2011
|
August
25, 2011
|
31,809,000.00
|
|
August
25, 2011
|
September
25, 2011
|
30,463,000.00
|
|
September
25, 2011
|
October
25, 2011
|
29,268,000.00
|
|
October
25, 2011
|
November
25, 2011
|
28,120,000.00
|
|
November
25, 2011
|
December
25, 2011
|
26,818,000.00
|
|
December
25, 2011
|
The
Termination Date
|
25,749,000.00
|
Annex
A
Paragraph
13 of the Credit Support Annex
ISDA®
CREDIT
SUPPORT ANNEX
to
the
Schedule to the
ISDA
Master Agreement
dated
as
of January 31, 2007 between
HSBC
Bank
USA, National Association (hereinafter referred to as “Party
A”
or
“Pledgor”)
and
HSBC
Bank
USA, National Association, not individually, but solely as Supplemental Interest
Trust Trustee on behalf of the Supplemental Interest Trust with respect to
the
Nomura Home Equity Loan, Inc., Home Equity Loan Trust, Series 2007-2
(hereinafter referred to as “Party
B”
or
“Secured
Party”).
For
the
avoidance of doubt, and notwithstanding anything to the contrary that may
be
contained in the Agreement, this Credit Support Annex shall relate solely
to the
Transaction documented in the Confirmation dated January 31, 2007 between
Party
A and Party B, Reference Number 454006HN.
Paragraph
13. Elections and Variables.
| (a) |
Security
Interest for “Obligations”.
The term “Obligations”
as
used in this Annex includes the following additional
obligations:
|
With
respect to Party A: not applicable.
With
respect to Party B: not applicable.
| (b) |
Credit
Support Obligations.
|
| (i) |
Delivery
Amount, Return Amount and Credit Support
Amount.
|
| (A) |
“Delivery
Amount”
has the meaning specified in Paragraph 3(a) as amended (I) by deleting
the
words “upon a demand made by the Secured Party on or promptly following
a
Valuation Date” and inserting in lieu thereof the words “not later than
the close of business on each Valuation Date” and (II) by deleting in its
entirety the sentence beginning “Unless otherwise specified in Paragraph
13” and ending “(ii) the Value as of that Valuation Date of all Posted
Credit Support held by the Secured Party.” and inserting in lieu thereof
the following:
|
The
“Delivery
Amount”
applicable to the Pledgor for any Valuation Date will equal the greatest
of
|
(1)
|
the
amount by which (a) the S&P/DBRS Credit Support Amount for such
Valuation Date exceeds (b) the S&P/DBRS Value as of such Valuation
Date of all Posted Credit Support held by the Secured Party,
|
|
(2)
|
the
amount by which (a) the Moody’s First Trigger Credit Support Amount for
such Valuation Date exceeds (b) the Moody’s First Trigger Value as of such
Valuation Date of all Posted Credit Support held by the Secured
Party,
and
|
|
(3)
|
the
amount by which (a) the Moody’s Second Trigger Credit Support Amount for
such Valuation Date exceeds (b) the Moody’s Second Trigger Value as of
such Valuation Date of all Posted Credit Support held by the Secured
Party.
|
| (B) |
“Return
Amount”
has the meaning specified in Paragraph 3(b) as amended by deleting
in its
entirety the sentence beginning “Unless otherwise specified in Paragraph
13” and ending “(ii) the Credit Support Amount.” and inserting in lieu
thereof the following:
|
The
“Return
Amount”
applicable to the Secured Party for any Valuation Date will equal the least
of
|
(1)
|
the
amount by which (a) the S&P/DBRS Value as of such Valuation Date of
all Posted Credit Support held by the Secured Party exceeds (b)
the
S&P/DBRS Credit Support Amount for such Valuation Date,
|
|
(2)
|
the
amount by which (a) the Moody’s First Trigger Value as of such Valuation
Date of all Posted Credit Support held by the Secured Party exceeds
(b)
the Moody’s First Trigger Credit Support Amount for such Valuation Date,
and
|
|
(3)
|
the
amount by which (a) the Moody’s Second Trigger Value as of such Valuation
Date of all Posted Credit Support held by the Secured Party exceeds
(b)
the Moody’s Second Trigger Credit Support Amount for such Valuation
Date.
|
| (C) |
“Credit
Support Amount”
shall not apply. For purposes of calculating any Delivery Amount
or Return
Amount for any Valuation Date, reference shall be made to the S&P/DBRS
Credit Support Amount, the Moody’s First Trigger Credit Support Amount, or
the Moody’s Second Trigger Credit Support Amount, in each case for such
Valuation Date, as provided in Paragraphs 13(b)(i)(A) and 13(b)(i)(B),
above.
|
| (ii) |
Eligible
Collateral.
|
On
any
date, the items set forth in Schedule I will qualify as “Eligible
Collateral”
(for
the avoidance of doubt, all Eligible Collateral to be denominated in
USD).
| (iii) |
Other
Eligible Support.
|
The
following items will qualify as “Other
Eligible Support”
for the
party specified:
Not
applicable.
| (iv) |
Threshold.
|
| (A) |
“Independent
Amount”
means zero with respect to Party A and Party
B.
|
| (B) |
“Threshold”
means, with respect to Party A and any Valuation Date, zero if (i)
a
Collateral Event has occurred and has been continuing (x) for at
least 30
days or (y) since this Annex was executed, or (ii) a Required Ratings
Downgrade Event has occurred and is continuing; otherwise,
infinity.
|
“Threshold”
means,
with respect to Party B and any Valuation Date, infinity.
| (C) |
“Minimum
Transfer Amount” means
USD 50,000 with respect to Party A and Party
B.
|
| (D) |
Rounding:
The Delivery Amount will be rounded up to the nearest integral multiple
of
USD 10,000. The Return Amount will be rounded down to the nearest
integral
multiple of USD 10,000.
|
| (c) |
Valuation
and Timing.
|
| (i) |
“Valuation
Agent”
means Party A; provided, however, that if an Event of Default shall
have
occurred with respect to which Party A is the Defaulting Party, Party
B
shall have the right to designate as Valuation Agent an independent
party,
reasonably acceptable to Party A, the cost for which shall be borne
by
Party A. All calculations by the Valuation Agent must be made in
accordance with standard market practice, including, in the event
of a
dispute as to the Value of any Eligible Credit Support or Posted
Credit
Support, by making reference to quotations received by the Valuation
Agent
from one or more Pricing Sources.
|
| (ii) |
“Valuation
Date” means
each Local Business Day on which any of the S&P/DBRS Credit Support
Amount, the Moody’s First Trigger Credit Support Amount or the Moody’s
Second Trigger Credit Support Amount is greater than
zero.
|
| (iii) |
“Valuation
Time” means
the close of business in the city of the Valuation Agent on the Local
Business Day immediately preceding the Valuation Date or date of
calculation, as applicable; provided
that the calculations of Value and Exposure will be made as of
approximately the same time on the same date. The Valuation Agent
will
notify each party (or the other party, if the Valuation Agent is
a party)
of its calculations not later than the Notification Time on the applicable
Valuation Date (or in the case of Paragraph 6(d), the Local Business
Day
following the day on which such relevant calculations are
performed).”
|
| (iv) |
“Notification
Time” means
11:00 a.m., New York time, on a Local Business Day.
|
| (v) |
External
Verification.
Notwithstanding anything to the contrary in the definitions of Valuation
Agent or Valuation Date, at any time at which Party A (or, to the
extent
applicable, its Credit Support Provider) does not have a long-term
unsubordinated and unsecured debt rating of at least “BBB+” from S&P,
the Valuation Agent shall (A) calculate the Secured Party’s Exposure and
the S&P/DBRS Value of Posted Credit Suppport on each Valuation Date
based on internal marks and (B) verify such calculations with external
marks monthly by obtaining on the last Local Business Day of each
calendar
month two external marks for each Transaction to which this Annex
relates
and for all Posted Credit Suport; such verification of the Secured
Party’s
Exposure shall be based on the higher of the two external marks.
Each
external xxxx in respect of a Transaction shall be obtained from
an
independent Reference Market-maker that would be eligible and willing
to
enter into such Transaction in the absence of the current derivative
provider, provided that an external xxxx xxx not be obtained from
the same
Reference Market-maker more than four times in any 12-month period.
The
Valuation Agent shall obtain these external marks directly or through
an
independent third party, in either case at no cost to Party B. The
Valuation Agent shall calculate on each Valuation Date (for purposes
of
this paragraph, the last Local Business Day in each calendar month
referred to above shall be considered a Valuation Date) the Secured
Party’s Exposure based on the greater of the Valuation Agent’s internal
marks and the external marks received. If the S&P/DBRS Value on any
such Valuation Date of all Posted Credit Support then held by the
Secured
Party is less than the S&P/DBRS Credit Support Amount on such
Valuation Date (in each case as determined pursuant to this paragraph),
Party A shall, within three Local Business Days of such Valuation
Date,
Transfer to the Secured Party Eligible Credit Support having an
S&P/DBRS Value as of the date of Transfer at least equal to such
deficiency.
|
| (vi) |
Notice
to S&P.
At
any time at which Party A (or, to the extent applicable, its Credit
Support Provider) does not have a long-term unsubordinated and unsecured
debt rating of at least “BBB+” from S&P, the Valuation Agent shall
provide to S&P not later than the Notification Time on the Local
Business Day following each Valuation Date its calculations of the
Secured
Party’s Exposure and the S&P/DBRS Value of any Eligible Credit Support
or Posted Credit Support for that Valuation Date. The Valuation Agent
shall also provide to S&P any external marks received pursuant to the
preceding paragraph.
|
| (d) |
Conditions
Precedent and Secured Party’s Rights and
Remedies.
The following Termination Events will be a “Specified
Condition”
for the party specified (that party being the Affected Party if the
Termination Event occurs with respect to that party): With respect
to
Party A: any Additional Termination Event with respect to which Party
A is
the sole Affected Party. With respect to Party B:
None.
|
| (e) |
Substitution.
|
| (i) |
“Substitution
Date”
has the meaning specified in Paragraph
4(d)(ii).
|
| (ii) |
Consent.
If
specified here as applicable, then the Pledgor must obtain the Secured
Party’s consent for any substitution pursuant to Paragraph 4(d):
Inapplicable.
|
| (f) |
Dispute
Resolution.
|
| (i) |
“Resolution
Time”
means 1:00 p.m. New York time on the Local Business Day following
the date
on which the notice of the dispute is given under Paragraph
5.
|
| (ii) |
Value.
Notwithstanding anything to the contrary in Paragraph 12, for the
purpose
of Paragraphs 5(i)(C) and 5(ii), the S&P/DBRS Value, Moody’s First
Trigger Value, and Moody’s Second Trigger Value, on any date, of Eligible
Collateral other than Cash will be calculated as follows:
|
For
Eligible Collateral in the form of securities listed in Paragraph 13(b)(ii):
the
sum of (A) the product of (1)(x) the bid price at the Valuation Time for
such
securities on the principal national securities exchange on which such
securities are listed, or (y) if such securities are not listed on a national
securities exchange, the bid price for such securities quoted at the Valuation
Time by any principal market maker for such securities selected by the Valuation
Agent, or (z) if no such bid price is listed or quoted for such date, the
bid
price listed or quoted (as the case may be) at the Valuation Time for the
day
next preceding such date on which such prices were available and (2) the
applicable Valuation Percentage for such Eligible Collateral, and (B) the
accrued interest on such securities (except to the extent Transferred to
the
Pledgor pursuant to Paragraph 6(d)(ii) or included in the applicable price
referred to in the immediately preceding clause (A)) as of such
date.
| (iii) |
Alternative.
The provisions of Paragraph 5 will apply.
|
| (g) |
Holding
and Using Posted
Collateral.
|
| (i) |
Eligibility
to Hold Posted Collateral; Custodians. Party
B (or any Custodian) will be entitled to hold Posted Collateral pursuant
to Paragraph 6(b).
|
Party
B
may appoint as Custodian (A) the entity then serving as Securities Administrator
or (B) any entity other than the entity then serving as Securities Administrator
if such other entity (or, to the extent applicable, its parent company or
credit
support provider) shall then have a short-term unsecured and unsubordinated
debt
rating from S&P of at least “A-1.”
Initially,
the Custodian
for
Party B is: Securities Administrator.
| (ii) |
Use
of Posted Collateral. The
provisions of Paragraph 6(c)(i) will not apply to Party B, but the
provisions of Paragraph 6(c)(ii) will apply to Party B.
|
| (h) |
Distributions
and Interest Amount.
|
| (i) |
Interest
Rate.
The “Interest
Rate”
will be the actual interest rate earned on Posted Collateral in the
form
of Cash that is held by Party B or its Custodian. Posted Collateral
in the
form of Cash shall be invested in such overnight (or redeemable within
two
Local Business Days of demand) Permitted Investments rated at least
(x)
AAAm or AAAm-G by S&P and (y) Prime-1 by Xxxxx’x or Aaa by Xxxxx’x, as
directed by Party A (unless (x) an Event of Default or an Additional
Termination Event has occurred with respect to which Party A is the
defaulting or sole Affected Party or (y) an Early Termination Date
has
been designated, in which case such investment shall be held uninvested).
Gains and losses incurred in respect of any investment of Posted
Collateral in the form of Cash in Permitted Investments as directed
by
Party A shall be for the account of Party
A.
|
| (ii) |
Transfer
of Interest Amount.
The Transfer of the Interest Amount will be made on the second Local
Business Day following the end of each calendar month and on any
other
Local Business Day on which Posted Collateral in the form of Cash
is
Transferred to the Pledgor pursuant to Paragraph 3(b); provided,
however,
that the obligation of Party B to Transfer any Interest Amount to
Party A
shall be limited to the extent that Party B has earned and received
such
funds and such funds are available to Party B.
|
| (iii) |
Alternative
to Interest Amount.
The provisions of Paragraph 6(d)(ii) will
apply.
|
| (i) |
Additional
Representation(s).
There are no additional representations by either
party.
|
| (j) |
Other
Eligible Support and Other Posted Support.
|
| (i) |
“Value”
with respect to Other Eligible Support and Other Posted Support means:
not
applicable.
|
| (ii) |
“Transfer”
with respect to Other Eligible Support and Other Posted Support means:
not
applicable.
|
| (k) |
Demands
and Notices.All
demands, specifications and notices under this Annex will be made
pursuant
to the Notices Section of this Agreement, except that any demand,
specification or notice shall be given to or made at the following
addresses, or at such other address as the relevant party may from
time to
time designate by giving notice (in accordance with the terms of
this
paragraph) to the other party:
|
If
to
Party A, at the address specified pursuant to the Notices Section of this
Agreement.
If
to
Party B, at the address specified pursuant to the Notices Section of this
Agreement.
If
to
Party B’s Custodian:
Xxxxx
Fargo Bank, N.A.
0000
Xxx
Xxxxxxxxx Xxxx
Xxxxxxxx,
Xxxxxxxx 00000
Attn:
Client Manager - NHEL 2007-2
Tel:
000-000-0000
Fax:
000-000-0000
| (l) |
Address
for Transfers.
Each Transfer hereunder shall be made to the address specified below
or to
an address specified in writing from time to time by the party to
which
such Transfer will be made.
|
Party
A
account details for holding collateral:
HSBC
Bank
USA, National Association
ABA
#
000-000-000
For
credit to Department 299
A/C:
000-00000-0
HSBC
Derivative Products Group
Party
B’s
Custodian account details for holding collateral
Xxxxx
Fargo Bank, N.A.
ABA
#
000-000-000
For
Credit to: SAS Clearing
A/C:
0000000000
FFC:
NHEL 2007-2, Posted Collateral Account, # 00000000
| (m) |
Other
Provisions.
|
| (i) |
Collateral
Account.
Party B shall open and maintain a segregated account, which shall
be an
Eligible Account, and hold, record and identify all Posted Collateral
in
such segregated account.
|
| (ii) |
Agreement
as to Single Secured Party and Single Pledgor.
Party A and Party B hereby agree that, notwithstanding anything to
the
contrary in this Annex, (a) the term “Secured Party” as used in this Annex
means only Party B, (b) the term “Pledgor” as used in this Annex means
only Party A, (c) only Party A makes the pledge and grant in Paragraph
2,
the acknowledgement in the final sentence of Paragraph 8(a) and the
representations in Paragraph 9.
|
| (iii) |
Calculation
of Value.
Paragraph 4(c) is hereby amended by deleting the word “Value” and
inserting in lieu thereof “S&P/DBRS Value, Xxxxx’x First Trigger
Value, Xxxxx’x Second Trigger Value”. Paragraph 4(d)(ii) is hereby amended
by (A) deleting the words “a Value” and inserting in lieu thereof “an
S&P/DBRS Value, Xxxxx’x First Trigger Value, and Xxxxx’x Second
Trigger Value” and (B) deleting the words “the Value” and inserting in
lieu thereof “S&P/DBRS Value, Xxxxx’x First Trigger Value, and Xxxxx’x
Second Trigger Value”. Paragraph 5 (flush language) is hereby amended by
deleting the word “Value” and inserting in lieu thereof “S&P/DBRS
Value, Xxxxx’x First Trigger Value, or Xxxxx’x Second Trigger Value”.
Paragraph 5(i) (flush language) is hereby amended by deleting the
word
“Value” and inserting in lieu thereof “S&P/DBRS Value, Xxxxx’x First
Trigger Value, and Xxxxx’x Second Trigger Value”. Paragraph 5(i)(C) is
hereby amended by deleting the word “the Value, if” and inserting in lieu
thereof “any one or more of the S&P/DBRS Value, Xxxxx’x First Trigger
Value, or Xxxxx’x Second Trigger Value, as may be”. Paragraph 5(ii) is
hereby amended by (1) deleting the first instance of the words “the Value”
and inserting in lieu thereof “any one or more of the S&P/DBRS Value,
Xxxxx’x First Trigger Value, or Xxxxx’x Second Trigger Value” and (2)
deleting the second instance of the words “the Value” and inserting in
lieu thereof “such disputed S&P/DBRS Value, Xxxxx’x First Trigger
Value, or Xxxxx’x Second Trigger Value”. Each of Paragraph 8(b)(iv)(B) and
Paragraph 11(a) is hereby amended by deleting the word “Value” and
inserting in lieu thereof “least of the S&P/DBRS Value, Xxxxx’x First
Trigger Value, and Xxxxx’x Second Trigger Value”.
|
| (iv) |
Form
of Annex. Party
A and Party B hereby agree that the text of Paragraphs 1 through
12,
inclusive, of this Annex is intended to be the printed form of ISDA
Credit
Support Annex (Bilateral Form - ISDA Agreements Subject to New York
Law
Only version) as published and copyrighted in 1994 by the International
Swaps and Derivatives Association, Inc.
|
| (v) |
Events
of Default.
Paragraph 7 will not apply to cause any Event of Default to exist
with
respect to Party B except that Paragraph 7(i) will apply to Party
B solely
in respect of Party B’s obligations under Paragraph 3(b) of the Credit
Support Annex. Notwithstanding anything to the contrary in Paragraph
7,
any failure by Party A to comply with or perform any obligation to
be
complied with or performed by Party A under the Credit Support Annex
shall
only be an Event of Default if (A) a
S&P Required Ratings Downgrade Event has occurred and been continuing
for 30 or more Local Business Days, and (B) such failure is not remedied
on or before the third Local Business Day after notice of such failure
is
given to Party A.
|
| (vi) |
Expenses.
Notwithstanding anything to the contrary in Paragraph 10, the Pledgor
will
be responsible for, and will reimburse the Secured Party for, all
transfer
and other taxes and other costs involved in any Transfer of Eligible
Collateral.
|
| (vii) |
Withholding.
Paragraph 6(d)(ii) is hereby amended by inserting immediately after
“the
Interest Amount” in the fourth line thereof the words “less any applicable
withholding taxes.”
|
(ix) Additional
Definitions.
As used
in this Annex:
“Collateral
Event” means
that no Relevant Entity has credit ratings at least equal to the Approved
Ratings Threshold.
“Exposure”
has the meaning specified in Paragraph 12, except that after the word
“Agreement” the words “(assuming, for this purpose only, that Part 1(f) of the
Schedule is deleted)” shall be inserted.
“Local
Business Day”
means:
any day on which (A) commercial banks are open for business (including dealings
in foreign exchange and foreign currency deposits) in New York and the location
of Party A, Party B and any Custodian, and (B) in relation to a Transfer
of
Eligible Collateral, any day on which the clearance system agreed between
the
parties for the delivery of Eligible Collateral is open for acceptance and
execution of settlement instructions (or in the case of a Transfer of Cash
or
other Eligible Collateral for which delivery is contemplated by other means
a
day on which commercial banks are open for business (including dealings in
foreign exchange and foreign deposits) in New York and the location of Party
A,
Party B and any Custodian.
“Xxxxx’x
First Trigger Event” means
that no Relevant Entity has credit ratings from Xxxxx’x at least equal to the
Xxxxx’x First Trigger Ratings Threshold.
“Xxxxx’x
First Trigger Credit Support Amount” means,
for any Valuation Date, the excess, if any, of
|
(I)
|
(A)
|
for
any Valuation Date on which (I) a Xxxxx’x First Trigger Event has occurred
and has been continuing (x) for at least 30 Local Business Days
or (y)
since this Annex was executed and (II) it is not the case that
a Xxxxx’x
Second Trigger Event has occurred and been continuing for at least
30
Local Business Days, an amount equal to the greater of (a) zero
and (b)
the sum of (i) the Secured Party’s Exposure for such Valuation Date and
(ii) the sum, for each Transaction to which this Annex relates,
of the
product of (1) the applicable Xxxxx’x First Trigger Factor set forth in
Table 1 and (2) the Notional Amount for such Transaction for the
Calculation Period which includes such Valuation Date; or
|
|
(B)
|
for
any other Valuation Date, zero,
over
|
(II)
the
Threshold for Party A such Valuation Date.
“Xxxxx’x
First Trigger Ratings Threshold” means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, (i) if such entity has a short-term unsecured and
unsubordinated debt rating from Xxxxx’x, a long-term unsecured and
unsubordinated debt rating or
counterparty rating from
Xxxxx’x of “A2” and a short-term unsecured and unsubordinated debt rating from
Xxxxx’x of “Prime-1”, or (ii) if such entity does not have a short-term
unsecured and unsubordinated debt rating or counterparty rating from Xxxxx’x, a
long-term unsecured and unsubordinated debt rating or counterparty rating
from
Xxxxx’x of “A1”.
“Xxxxx’x
First Trigger Value”
means,
on any date and with respect to any Eligible Collateral other than Cash,
the bid
price obtained by the Valuation Agent multiplied by the Xxxxx’x First Trigger
Valuation Percentage for such Eligible Collateral set forth in Paragraph
13(b)(ii).
“Xxxxx’x
Second Trigger Event” means
that no Relevant Entity has credit ratings from Xxxxx’x at least equal to the
Xxxxx’x Second Trigger Ratings Threshold.
“Xxxxx’x
Second Trigger Credit Support Amount”
means,
for any Valuation Date, the excess, if any, of
|
(I)
|
(A)
|
for
any Valuation Date on which it is the case that a Xxxxx’x Second Trigger
Event has occurred and been continuing for at least 30 Local Business
Days, an amount equal to the greatest of (a) zero, (b) the aggregate
amount of the next payment due to be paid by Party A under each
Transaction to which this Annex relates, and (c) the sum of (x)
the
Secured Party’s Exposure for such Valuation Date and (y) the sum, for each
Transaction to which this Annex relates, of
|
(1)
if
such Transaction is not a Transaction-Specific Hedge, the product of (i)
the
applicable Xxxxx’x Second Trigger Factor set forth in Table 2 and (ii) the
Notional Amount for such Transaction for the Calculation Period which includes
such Valuation Date;
or
(2)
if
such Transaction is a Transaction-Specific Hedge, the
product of (i) the applicable Xxxxx’x Second Trigger Factor set forth in Table 3
and (ii) the Notional Amount for such Transaction for the Calculation Period
which includes such Valuation Date; or
|
(B)
|
for
any other Valuation Date, zero,
over
|
(II) the
Threshold for Party A for such Valuation Date.
“Xxxxx’x
Second Trigger Ratings Threshold” means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, (i) if such entity has a short-term unsecured and
unsubordinated debt rating from Xxxxx’x, a long-term unsecured and
unsubordinated debt rating or counterparty rating from Xxxxx’x of “A3” and a
short-term unsecured and unsubordinated debt rating from Xxxxx’x of “Prime-2”,
or (ii) if such entity does not have a short-term unsecured and unsubordinated
debt rating from Xxxxx’x, a long-term unsecured and unsubordinated debt rating
or counterparty rating from Xxxxx’x of “A3”.
“Xxxxx’x
Second Trigger Value”
means,
on any date and with respect to any Eligible Collateral other than Cash,
the bid
price obtained by the Valuation Agent multiplied by the Xxxxx’x Second Trigger
Valuation Percentage for such Eligible Collateral set forth in Paragraph
13(b)(ii).
“Pricing
Sources”
means
the sources of financial information commonly known as Bloomberg, Bridge
Information Services, Data Resources Inc., Interactive Data Services,
International Securities Market Association, Xxxxxxx Xxxxx Securities Pricing
Service, Xxxxxx Data Corporation, Reuters, Wood Gundy, Trepp Pricing, XX
Xxxxx,
S&P and Telerate.
“S&P
Approved Ratings Threshold”
means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, a short-term unsecured and unsubordinated debt rating
from
S&P of “A-1”, or, if such entity does not have a short-term unsecured and
unsubordinated debt rating from S&P, a long-term unsecured and
unsubordinated debt rating from S&P of “A+”.
“S&P/DBRS
Credit Support Amount”
means,
for any Valuation Date, the excess, if any, of
|
(I)
|
(A)
|
for
any Valuation Date on which (i) an S&P/DBRS Rating Threshold Event has
occurred and been continuing for at least 30 days, or (ii) a S&P/DBRS
Required Ratings Downgrade Event has occurred and is continuing,
an amount
equal to the sum of (1) 100.0% of the Secured Party’s Exposure for such
Valuation Date and (2) the sum, for each Transaction to which this
Annex
relates, of the product of (i) the Volatility Buffer for such Transaction
and (ii) the Notional Amount of such Transaction for the Calculation
Period of such Transaction which includes such Valuation Date,
or
|
|
(B)
|
for
any other Valuation Date, zero,
over
|
(II)
the
Threshold for Party A for such Valuation Date.
“S&P/DBRS
Rating Threshold Event”
means,
on any date, no Relevant Entity has credit ratings from S&P which equal or
exceed the S&P Approved Ratings Threshold and the DBRS Approved Ratings
Threshold.
“S&P/DBRS
Required Ratings Downgrade Event”
means
that no Relevant Entity has credit ratings at least equal to the S&P
Required Ratings Threshold and the DBRS Required Ratings Threshold.
“S&P/DBRS
Value”
means,
on any date and with respect to any Eligible Collateral other than Cash,
the
product of (A) the bid price obtained by the Valuation Agent for such Eligible
Collateral and (B) the S&P Valuation Percentage for such Eligible Collateral
set forth in paragraph 13(b)(ii).
“Transaction
Exposure”
means,
for any Transaction, Exposure determined as if such Transaction were the
only
Transaction between the Secured Party and the Pledgor.
“Transaction-Specific
Hedge” means
any
Transaction that is (i) an interest rate swap in respect of which (x) the
notional amount of the interest rate swap is “balance guaranteed” or (y) the
notional amount of the interest rate swap for any Calculation Period otherwise
is not a specific dollar amount that is fixed at the inception of the
Transaction, (ii) an interest rate cap, (iii) an interest rate floor or (iv)
an
interest rate swaption.
“Valuation
Percentage”
shall
mean, for purposes of determining the S&P/DBRS Value, Xxxxx’x First Trigger
Value, or Xxxxx’x Second Trigger Value with respect to any Eligible Collateral
or Posted Collateral, the applicable S&P/DBRS Valuation Percentage, Xxxxx’x
First Trigger Valuation Percentage, or Xxxxx’x Second Trigger Valuation
Percentage for such Eligible Collateral or Posted Collateral, respectively,
in
each case as set forth in Paragraph 13(b)(ii).
“Value”
shall
mean, in respect of any date, the related S&P/DBRS Value, the related
Xxxxx’x First Trigger Value, and the related Xxxxx’x Second Trigger
Value.
“Volatility
Buffer”
means,
for any Transaction, the related percentage set forth in the following table.
|
The
higher of the S&P credit rating of (i) Party A and (ii) the Credit
Support Provider of Party A, if applicable
|
Remaining
Weighted Average Maturity of such Transaction
up
to 3 years
|
Remaining
Weighted Average Maturity of such Transaction
up
to 5 years
|
Remaining
Weighted Average Maturity of such Transaction
up
to 10 years
|
Remaining
Weighted Average Maturity of such Transaction
up
to 30 years
|
|
“A-2”
or higher
|
2.75%
|
3.25%
|
4.00%
|
4.75%
|
|
“A-3”
|
3.25%
|
4.00%
|
5.00%
|
6.25%
|
|
“BB+”
or
lower
|
3.50%
|
4.50%
|
6.75%
|
7.50%
|
[Remainder
of this page intentionally left blank]
Table
1
Xxxxx’x
First Trigger Factor
|
Remaining
Weighted
Average Life
of
Hedge in Years
|
Daily
Collateral
Posting
|
|
1
or less
|
0.15%
|
|
More
than 1 but not more than 2
|
0.30%
|
|
More
than 2 but not more than 3
|
0.40%
|
|
More
than 3 but not more than 4
|
0.60%
|
|
More
than 4 but not more than 5
|
0.70%
|
|
More
than 5 but not more than 6
|
0.80%
|
|
More
than 6 but not more than 7
|
1.00%
|
|
More
than 7 but not more than 8
|
1.10%
|
|
More
than 8 but not more than 9
|
1.20%
|
|
More
than 9 but not more than 10
|
1.30%
|
|
More
than 10 but not more than 11
|
1.40%
|
|
More
than 11 but not more than 12
|
1.50%
|
|
More
than 12 but not more than 13
|
1.60%
|
|
More
than 13 but not more than 14
|
1.70%
|
|
More
than 14 but not more than 15
|
1.80%
|
|
More
than 15 but not more than 16
|
1.90%
|
|
More
than 16 but not more than 17
|
2.00%
|
|
More
than 17 but not more than 18
|
2.00%
|
|
More
than 18 but not more than 19
|
2.00%
|
|
More
than 19 but not more than 20
|
2.00%
|
|
More
than 20 but not more than 21
|
2.00%
|
|
More
than 21 but not more than 22
|
2.00%
|
|
More
than 22 but not more than 23
|
2.00%
|
|
More
than 23 but not more than 24
|
2.00%
|
|
More
than 24 but not more than 25
|
2.00%
|
|
More
than 25 but not more than 26
|
2.00%
|
|
More
than 26 but not more than 27
|
2.00%
|
|
More
than 27 but not more than 28
|
2.00%
|
|
More
than 28 but not more than 29
|
2.00%
|
|
More
than 29
|
2.00%
|
Table
2
Xxxxx’x
Second Trigger Factor for Interest Rate Swaps with Fixed Notional
Amounts
|
Remaining
Weighted
Average Life
of
Hedge in Years
|
Daily
Collateral
Posting
|
|
1
or less
|
0.50%
|
|
More
than 1 but not more than 2
|
1.00%
|
|
More
than 2 but not more than 3
|
1.50%
|
|
More
than 3 but not more than 4
|
1.90%
|
|
More
than 4 but not more than 5
|
2.40%
|
|
More
than 5 but not more than 6
|
2.80%
|
|
More
than 6 but not more than 7
|
3.20%
|
|
More
than 7 but not more than 8
|
3.60%
|
|
More
than 8 but not more than 9
|
4.00%
|
|
More
than 9 but not more than 10
|
4.40%
|
|
More
than 10 but not more than 11
|
4.70%
|
|
More
than 11 but not more than 12
|
5.00%
|
|
More
than 12 but not more than 13
|
5.40%
|
|
More
than 13 but not more than 14
|
5.70%
|
|
More
than 14 but not more than 15
|
6.00%
|
|
More
than 15 but not more than 16
|
6.30%
|
|
More
than 16 but not more than 17
|
6.60%
|
|
More
than 17 but not more than 18
|
6.90%
|
|
More
than 18 but not more than 19
|
7.20%
|
|
More
than 19 but not more than 20
|
7.50%
|
|
More
than 20 but not more than 21
|
7.80%
|
|
More
than 21 but not more than 22
|
8.00%
|
|
More
than 22 but not more than 23
|
8.00%
|
|
More
than 23 but not more than 24
|
8.00%
|
|
More
than 24 but not more than 25
|
8.00%
|
|
More
than 25 but not more than 26
|
8.00%
|
|
More
than 26 but not more than 27
|
8.00%
|
|
More
than 27 but not more than 28
|
8.00%
|
|
More
than 28 but not more than 29
|
8.00%
|
|
More
than 29
|
8.00%
|
Table
3
Xxxxx’x
Second Trigger Factor for Transaction-Specific Xxxxxx
|
Remaining
Weighted
Average Life
of
Hedge in Years
|
Daily
Collateral
Posting
|
|
1
or less
|
0.65%
|
|
More
than 1 but not more than 2
|
1.30%
|
|
More
than 2 but not more than 3
|
1.90%
|
|
More
than 3 but not more than 4
|
2.50%
|
|
More
than 4 but not more than 5
|
3.10%
|
|
More
than 5 but not more than 6
|
3.60%
|
|
More
than 6 but not more than 7
|
4.20%
|
|
More
than 7 but not more than 8
|
4.70%
|
|
More
than 8 but not more than 9
|
5.20%
|
|
More
than 9 but not more than 10
|
5.70%
|
|
More
than 10 but not more than 11
|
6.10%
|
|
More
than 11 but not more than 12
|
6.50%
|
|
More
than 12 but not more than 13
|
7.00%
|
|
More
than 13 but not more than 14
|
7.40%
|
|
More
than 14 but not more than 15
|
7.80%
|
|
More
than 15 but not more than 16
|
8.20%
|
|
More
than 16 but not more than 17
|
8.60%
|
|
More
than 17 but not more than 18
|
9.00%
|
|
More
than 18 but not more than 19
|
9.40%
|
|
More
than 19 but not more than 20
|
9.70%
|
|
More
than 20 but not more than 21
|
10.00%
|
|
More
than 21 but not more than 22
|
10.00%
|
|
More
than 22 but not more than 23
|
10.00%
|
|
More
than 23 but not more than 24
|
10.00%
|
|
More
than 24 but not more than 25
|
10.00%
|
|
More
than 25 but not more than 26
|
10.00%
|
|
More
than 26 but not more than 27
|
10.00%
|
|
More
than 27 but not more than 28
|
10.00%
|
|
More
than 28 but not more than 29
|
10.00%
|
|
More
than 29
|
10.00%
|
Schedule
1
Eligible
Collateral
|
Eligible
Collateral & Valuation Percentages
Xxxxx’x
and S&P/DBRS
|
||||
|
Valuation
Percentage
|
Valuation
Percentage
|
|||
|
Xxxxx’x
|
S&P/DBRS
|
|||
|
First
Trigger
|
Second
Trigger
|
Daily
|
||
|
(A)
|
Cash
|
100
|
100
|
100
|
|
(B)
|
Fixed-rate
negotiable debt obligations issued by the U.S. Treasury Department
having
a remaining maturity on such date of not more than one
year
|
100
|
100
|
98.5
|
|
(C)
|
Fixed-rate
negotiable debt obligations issued by the U.S. Treasury Department
having
a remaining maturity on such date of more than one year but not
more than
ten years
|
100
|
94
|
89.9
|
|
(D)
|
Fixed-rate
negotiable debt obligations issued by the U.S. Treasury Department
having
a remaining maturity on such date of more than ten years
|
100
|
87
|
83.9
|
|
(E)
|
Agency
Securities:
negotiable debt obligations of the Federal National Mortgage Association
(FNMA) and Xxxxxxx Mac (collectively, “Agency
Securities”)
issued after July 18, 1984 and having a remaining maturity of not
more
than 1 year.
|
100
|
99
|
98.5
|
|
(F)
|
Agency
Securities having a remaining maturity of greater than 1 year but
not more
than 2 years.
|
100
|
98
|
97.7
|
|
(G)
|
Agency
Securities having a remaining maturity of greater than 2 years
but not
more than 3 years.
|
100
|
97
|
97.3
|
|
(H)
|
Agency
Securities having a remaining maturity of greater than 3 years
but not
more than 5 years.
|
100
|
96
|
94.5
|
|
(I)
|
Agency
Securities having a remaining maturity of greater than 5 years
but not
more than 7 years.
|
100
|
94
|
93.1
|
|
(J)
|
Agency
Securities having a remaining maturity of greater than 7 years
but not
more than 10 years.
|
100
|
93
|
90.7
|
|
(K)
|
Agency
Securities having a remaining maturity of greater than 10 years
but not
more than 20 years.
|
100
|
88
|
87.7
|
|
(L)
|
Agency
Securities having a remaining maturity of greater than 20 years
but not
more than 30 years.
|
100
|
86
|
84.4
|
IN
WITNESS WHEREOF, the parties have executed this Annex by their duly authorized
representatives as of the date of the Agreement.
|
HSBC
Bank USA, National Association
|
HSBC
Bank USA, National Association, not individually, but solely as
Supplemental Interest Trust Trustee on behalf of the Supplemental
Interest
Trust with respect to the Nomura Home Equity Loan, Inc., Home Equity
Loan
Trust, Series 2007-2
|
|||
|
By:
|
By:
|
|||
|
Name:
|
Name:
|
|||
|
Title:
|
Title:
|
|||
|
Date:
|
Date:
|
|||
EXHIBIT
R
INTEREST
RATE CAP CONTRACT
HSBC
Bank
USA, National Association
000
Xxxxx
Xxxxxx
Xxx
Xxxx,
XX 00000
Fax:
(000) 000-0000
|
DATE:
|
January
31, 2007
|
|
|
TO:
|
HSBC
Bank USA, National Association, not individually, but solely
as
Supplemental Interest Trust Trustee on behalf of the Supplemental
Interest
Trust with respect to the Nomura Home Equity Loan, Inc., Home
Equity Loan
Trust, Series 2007-2
|
|
|
ATTENTION:
|
HSBC
Bank USA, National Association
|
|
|
000
Xxxxx Xxx.
|
||
|
Xxx
Xxxx, XX 00000
|
||
|
FACSIMILE:
|
000-000-0000
|
|
|
with
a copy to:
|
||
|
ATTENTION:
|
Xxxxx
Fargo Bank, N.A.
|
|
|
0000
Xxx Xxxxxxxxx Xxxx
|
||
|
Xxxxxxxx,
XX 00000
|
||
|
Attn:
Client Manager, NHEL 2007-2
|
||
|
FACSIMILE:
|
000-000-0000
|
|
|
FROM:
|
HSBC
Bank USA, National Association
|
|
|
TELEPHONE
:
|
000-000-0000
|
|
|
FACSIMILE:
|
000-000-0000
|
|
|
SUBJECT:
|
Fixed
Income Derivatives Confirmation
|
|
|
REFERENCE
NUMBER:
|
453999HN/454000HN
|
The
purpose of this long-form confirmation (“Confirmation”)
is to
confirm the terms and conditions of the current Transaction entered into
on the
Trade Date specified below (the “Transaction”)
between
HSBC Bank USA, National Association (“Party
A”) and
HSBC
Bank USA, National Association, not individually, but solely as supplemental
interest trust trustee (the “Supplemental Interest Trust Trustee”) on behalf of
the supplemental interest trust with respect to the Nomura Home Equity Loan,
Inc., Home Equity Loan Trust, Series 2007-2 (the “Supplemental
Interest Trust”)
(“Party
B”)
created
under the Pooling and Servicing Agreement, dated as of January 1, 2007, among
Nomura Home Equity Loan, Inc., as depositor (the “Depositor”),
Nomura Credit & Capital, Inc., as sponsor (the “Sponsor”),
Xxxxx
Fargo Bank, N.A., as master servicer (the “Master
Servicer”)
and
securities administrator (the “Securities
Administrator”),
Ocwen
Loan Servicing, LLC, Select Portfolio Servicing Inc. and Equity One, Inc.,
each
as servicer (each a “Servicer”
and
collectively, the “Servicers”)
and
HSBC Bank USA, National Association, not in its individual capacity, but
solely
as trustee (the “Trustee”) (the
“Pooling
and Servicing Agreement”). This
Confirmation evidences a complete and binding agreement between you and us
to
enter into the Transaction on the terms set forth below and replaces any
previous agreement between us with respect to the subject matter hereof.
This
Confirmation constitutes a “Confirmation”
and also
constitutes a “Schedule”
as
referred to in the ISDA Master Agreement, and Paragraph 13 of a Credit Support
Annex to the Schedule.
| 1. |
This
Confirmation shall supplement, form a part of, and be subject to
an
agreement in the form of the ISDA Master Agreement (Multicurrency
- Cross
Border) as published and copyrighted in 1992 by the International
Swaps
and Derivatives Association, Inc. (the “ISDA
Master Agreement”),
as if Party A and Party B had executed an agreement in such form
on the
date hereof, with a Schedule as set forth in Item 3 of this Confirmation,
and an ISDA Credit Support Annex (Bilateral Form - ISDA Agreements
Subject
to New York Law Only version) as published and copyrighted in 1994
by the
International Swaps and Derivatives Association, Inc., with Paragraph
13
thereof as set forth in Annex A hereto (the “Credit
Support Annex”).
For the avoidance of doubt, the Transaction described herein shall
be the
sole Transaction governed by such ISDA Master Agreement. In the
event of
any inconsistency among any of the following documents, the relevant
document first listed shall govern: (i) this Confirmation, exclusive
of
the provisions set forth in Item 3 hereof and Annex A hereto; (ii)
the
provisions set forth in Item 3 hereof, which are incorporated by
reference
into the Schedule; (iii) the Credit Support Annex; (iv) the Definitions;
and (v) the ISDA Master Agreement.
|
Each
reference herein to a “Section” (unless specifically referencing the Pooling and
Servicing Agreement) or to a “Section” “of this Agreement” will be construed as
a reference to a Section of the ISDA Master Agreement; each herein reference
to
a “Part” will be construed as a reference to the provisions herein deemed
incorporated in a Schedule to the ISDA Master Agreement; each reference herein
to a “Paragraph” will be construed as a reference to a Paragraph of the Credit
Support Annex.
|
2.
|
The
terms of the particular Transaction to which this Confirmation
relates are
as follows:
|
|
Type
of Transaction:
|
Interest
Rate Cap
|
|||
|
Notional
Amount:
|
With
respect to any Calculation Period the Calculation
Amount set forth for such period in Schedule I, which is attached
hereto
and incorporated by reference into this Confirmation.
|
|||
|
Trade
Date:
|
January
29, 2007
|
|||
|
Effective
Date:
|
July
25, 2008
|
|||
|
Termination
Date:
|
January
25, 2012, subject to adjustment in accordance with the Following
Business
Day Convention.
|
|||
|
Fixed
Amount:
|
As
per side agreement
|
|||
|
Party
A Floating Amounts:
|
||||
|
Party
A
|
||||
|
Period
End Dates:
|
The
25th
calendar day of each month during the Term of this Transaction,
commencing
August 25, 2008, and ending on the Termination Date, subject
to adjustment
in accordance with the Following Business Day
Convention.
|
|||
|
Floating
Rate Payer
|
||||
|
Payment
Dates:
|
Early
Payment shall be applicable. The Floating Rate payer Payment
Date shall be
two Business Days prior to such Floating Rate Payer Period End
Date.
|
|||
|
Cap
Rate:
|
5.300000
%
|
|||
|
|
||||
|
|
||||
|
Floating
Rate Option:
|
USD-LIBOR-BBA;
provided, however, that if the Floating Rate Option for any Calculation
Period is greater than 9.500000%, then the Floating Rate Option
for such
Calculation Period shall be deemed to be 9.500000%.
|
|||
|
|
||||
|
|
||||
|
Designated
Maturity:
|
One
month
|
|||
|
|
||||
|
Floating
Rate Day
|
||||
|
Count
Fraction:
|
Actual/360
|
|||
|
|
||||
|
Reset
Dates:
|
The
first day of each Calculation Period.
|
|||
|
|
||||
|
Compounding:
|
Inapplicable
|
|||
|
|
||||
|
Business
Days:
|
New
York
|
|||
|
|
||||
|
Business
Day Convention:
|
Following
|
|||
|
3.
|
Provisions
Deemed Incorporated in a Schedule to the ISDA Master
Agreement:
|
|
Part
1.
|
Termination
Provisions.
|
For
the
purposes of this Agreement:-
(a)
“Specified
Entity”
will not
apply to Party A or Party B for any purpose.
|
(b)
|
“Specified
Transaction”
will have the meaning specified in Section
14.
|
|
(c)
|
Events
of Default.
|
The
statement below that an Event of Default will apply to a specific party means
that upon the occurrence of such an Event of Default with respect to such
party,
the other party shall have the rights of a Non-defaulting Party under Section
6
of this Agreement; conversely, the statement below that such event will not
apply to a specific party means that the other party shall not have such
rights.
| (i) |
The
“Failure
to Pay or Deliver”
provisions of Section 5(a)(i) will apply to Party A and will apply
to
Party B; provided, however, that Section 5(a)(i) is hereby amended
by
replacing the word “third” with the word “first”; provided, further, that
notwithstanding anything to the contrary in Section 5(a)(i), any
failure
by Party A to comply with or perform any obligation to be complied
with or
performed by Party A under the Credit Support Annex shall not constitute
an Event of Default under Section 5(a)(i) unless (A) a Required
Ratings
Downgrade Event has occurred and been continuing for 30 or more
Local
Business Days, and (B) such failure is not remedied on or before
the third
Local Business Day after notice of such failure is given to Party
A.
|
| (ii) |
The
“Breach
of Agreement”
provisions of Section 5(a)(ii) will apply to Party A and will not
apply to
Party B.
|
| (iii) |
The
“Credit
Support Default”
provisions of Section 5(a)(iii) will apply to Party A and will
not apply
to Party B except that Section 5(a)(iii)(1) will apply to Party
B solely
in respect of Party B’s obligations under Paragraph 3(b) of the Credit
Support Annex; provided, however, that notwithstanding anything
to the
contrary in Section 5(a)(iii)(1), any failure by Party A to comply
with or
perform any obligation to be complied with or performed by Party
A under
the Credit Support Annex shall not constitute an Event of Default
under
Section 5(a)(iii) unless (A) a Required Ratings Downgrade Event
has
occurred and been continuing for 30 or more Local Business Days,
and (B)
such failure is not remedied on or before the third Local Business
Day
after notice of such failure is given to Party
A.
|
| (iv) |
The
“Misrepresentation”
provisions of Section 5(a)(iv) will apply to Party A and will not
apply to
Party B.
|
| (v) |
The
“Default
under Specified Transaction”
provisions of Section 5(a)(v) will apply to Party A and will not
apply to
Party B.
|
| (vi) |
The
“Cross
Default”
provisions of Section 5(a)(vi) will apply to Party A and will not
apply to
Party B. For purposes of Section 5(a)(vi), solely with respect
to Party
A:
|
“Specified
Indebtedness” will have the meaning specified in Section 14, except that such
term shall not include obligations in respect of deposits received in the
ordinary course of Party A’s banking business.
“Threshold
Amount” means with respect to Party A an amount equal to three percent (3%) of
the Shareholders’ Equity of Party A (as set forth in Party A’s Call Report) or,
if applicable, the Eligible Guarantor.
“Shareholders’
Equity” means with respect to an entity, at any time, the sum (as shown in the
most recent annual audited financial statements of such entity) of (i) its
capital stock (including preferred stock) outstanding, taken at par value,
(ii)
its capital surplus and (iii) its retained earnings, minus (iv) treasury
stock,
each to be determined in accordance with generally accepted accounting
principles.
| (vii) |
The
“Bankruptcy”
provisions of Section 5(a)(vii) will apply to Party A and will
apply to
Party B except that the provisions of Section 5(a)(vii)(2), (6)
(to the
extent that such provisions refer to any appointment contemplated
or
effected by the Pooling and Servicing Agreement or any appointment
to
which Party B has not become subject), (7) and (9) will not apply
to Party
B; provided that, with respect to Party B only, Section 5(a)(vii)(4)
is
hereby amended by adding after the words “against it” the words
“(excluding any proceeding or petition instituted or presented by
Party A
or its Affiliates)”, and Section 5(a)(vii)(8) is hereby amended by
deleting the words “to (7) inclusive” and inserting lieu thereof “, (3),
(4) as amended, (5), (6) as amended, or
(7)”.
|
| (viii) |
The
“Merger
Without Assumption”
provisions of Section 5(a)(viii) will apply to Party A and will
not apply
to Party B.
|
(d)
Termination
Events.
The
statement below that a Termination Event will apply to a specific party means
that upon the occurrence of such a Termination Event, if such specific party
is
the Affected Party with respect to a Tax Event, the Burdened Party with respect
to a Tax Event Upon Merger (except as noted below) or the non-Affected Party
with respect to a Credit Event Upon Merger, as the case may be, such specific
party shall have the right to designate an Early Termination Date in accordance
with Section 6 of this Agreement; conversely, the statement below that such
an
event will not apply to a specific party means that such party shall not
have
such right; provided, however, with respect to “Illegality” the statement that
such event will apply to a specific party means that upon the occurrence
of such
a Termination Event with respect to such party, either party shall have the
right to designate an Early Termination Date in accordance with Section 6
of
this Agreement.
(i)
The
“Illegality”
provisions of Section 5(b)(i) will apply to Party A and will apply to Party
B.
|
(ii)
|
The
“Tax
Event”
provisions of Section 5(b)(ii) will apply to Party A except that,
for
purposes of the application of Section 5(b)(ii) to Party A, Section
5(b)(ii) is hereby amended by deleting the words “(x) any action taken by
a taxing authority, or brought in a court of competent jurisdiction,
on or
after the date on which a Transaction is entered into (regardless
of
whether such action is taken or brought with respect to a party
to this
Agreement) or (y)”, and the “Tax
Event”
provisions of Section 5(b)(ii) will apply to Party B.
|
|
(iii)
|
The
“Tax
Event Upon Merger”
provisions of Section 5(b)(iii) will apply to Party A and will
apply to
Party B, provided that Party A shall not be entitled to designate
an Early
Termination Date by reason of a Tax Event upon Merger in respect
of which
it is the Affected Party.
|
|
(iv)
|
The
“Credit
Event Upon Merger”
provisions of Section 5(b)(iv) will not apply to Party A and will
not
apply to Party B.
|
|
(e)
|
The
“Automatic
Early Termination”
provision of Section 6(a) will not apply to Party A and will not
apply to
Party B.
|
(f)
Payments
on Early Termination.
For the
purpose of Section 6(e) of this Agreement:
| (i) |
Market
Quotation will apply, provided, however, that, in the event of
a
Derivative Provider Trigger Event, the following provisions will
apply:
|
|
(A)
|
The
definition of Market Quotation in Section 14 shall be deleted in
its
entirety and replaced with the
following:
|
“Market
Quotation” means,
with respect to one or more Terminated Transactions, a Firm Offer which is
(1)
made by a Reference Market-maker that is an Eligible Replacement, (2) for
an
amount that would be paid to Party B (expressed as a negative number) or
by
Party B (expressed as a positive number) in consideration of an agreement
between Party B and such Reference Market-maker to enter into a Replacement
Transaction, and (3) made on the basis that Unpaid Amounts in respect of
the
Terminated Transaction or group of Transactions are to be excluded but, without
limitation, any payment or delivery that would, but for the relevant Early
Termination Date, have been required (assuming satisfaction of each applicable
condition precedent) after that Early Termination Date is to be included.
|
(B)
|
The
definition of Settlement Amount shall be deleted in its entirety
and
replaced with the following:
|
“Settlement
Amount”
means,
with respect to any Early Termination Date, an amount (as determined by Party
B)
equal to:
|
(a)
|
If
a Market Quotation for the relevant Terminated Transaction or group
of
Terminated Transactions is accepted by Party B so as to become
legally
binding on or before the day falling ten Local Business Days after
the day
on which the Early Termination Date is designated, or such later
day as
Party B may specify in writing to Party A, but in either case no
later
than one Local Business Day prior to the Early Termination Date
(such day,
the “Latest Settlement Amount Determination Day”), the Termination
Currency Equivalent of the amount (whether positive or negative)
of such
Market Quotation;
|
|
(b)
|
If,
on the Latest Settlement Amount Determination Day, no Market Quotation
for
the relevant Terminated Transaction or group of Terminated Transactions
has been accepted by Party B so as to become legally binding and
one or
more Market Quotations from
Approved Replacements have
been made and remain capable of becoming legally binding upon acceptance,
the Settlement Amount shall equal the Termination Currency Equivalent
of
the amount (whether positive or negative) of the lowest of such
Market
Quotations (for the avoidance of doubt, the lowest of such Market
Quotations shall be the lowest Market Quotation of
such Market Quotations
expressed as a positive number or, if any of such Market Quotations
is
expressed as a negative number, the Market Quotation expressed
as a
negative number with the largest absolute value);
or
|
|
(c)
|
If,
on the Latest Settlement Amount Determination Day, no Market Quotation
for
the relevant Terminated Transaction or group of Terminated Transactions
is
accepted by Party B so as to become legally binding and no Market
Quotation from an Approved Replacement remains capable of becoming
legally
binding upon acceptance, the Settlement Amount shall equal Party
B’s Loss
(whether positive or negative and without reference to any Unpaid
Amounts)
for the relevant Terminated Transaction or group of Terminated
Transactions.
|
|
(C)
|
If
Party B requests Party A in writing to obtain Market Quotations,
Party A
shall use its reasonable efforts to do so before the Latest Settlement
Amount Determination Day.
|
|
(D)
|
If
the Settlement Amount is a negative number, Section 6(e)(i)(3)
shall be
deleted in its entirety and replaced with the
following:
|
“(3)
Second
Method and Market Quotation.
If the
Second Method and Market Quotation apply, (I) Party B shall pay to Party
A an
amount equal to the absolute value of the Settlement Amount in respect of
the
Terminated Transactions, (II) Party B shall pay to Party A the Termination
Currency Equivalent of the Unpaid Amounts owing to Party A and (III) Party
A
shall pay to Party B the Termination Currency Equivalent of the Unpaid Amounts
owing to Party B; provided, however, that (x) the amounts payable under the
immediately preceding clauses (II) and (III) shall be subject to netting
in
accordance with Section 2(c) of this Agreement and (y) notwithstanding any
other
provision of this Agreement, any amount payable by Party A under the immediately
preceding clause (III) shall not be netted-off against any amount payable
by
Party B under the immediately preceding clause (I).”
|
(E)
|
At
any time on or before the Latest Settlement Amount Determination
Day at
which two or more Market Quotations from Approved Replacements
remain
capable of becoming legally binding upon acceptance, Party B shall
be
entitled to accept only the lowest of such Market Quotations (for
the
avoidance of doubt, the lowest of such Market Quotations shall
be the
lowest Market Quotation of such Market Quotations expressed as
a positive
number or, if any of such Market Quotations is expressed as a negative
number, the Market Quotation expressed as a negative number with
the
largest absolute value).
|
| (ii) |
The
Second Method will apply.
|
(g)
“Termination
Currency”
means
USD.
(h)
Additional
Termination Events.
Additional Termination Events will apply as provided in Part 5(c).
Part
2. Tax
Matters.
(a)
Tax
Representations.
|
(i)
|
Payer
Representations.
For the purpose of Section 3(e) of this Agreement:
|
(A)
Party
A
makes the following representation(s):
It
is not
required by any applicable law, as modified by the practice of any relevant
governmental revenue authority, of any Relevant Jurisdiction to make any
deduction or withholding for or on account of any Tax from any payment (other
than interest under Section 2(e), 6(d)(ii) or 6(e) of this Agreement) to
be made
by it to the other party under this Agreement. In making this representation,
it
may rely on: (i) the accuracy of any representations made by the other party
pursuant to Section 3(f) of this Agreement; (ii) the satisfaction of the
agreement contained in Section 4(a)(i) or 4(a)(iii) of this Agreement and
the
accuracy and effectiveness of any document provided by the other party pursuant
to Section 4(a)(i) or 4(a)(iii) of this Agreement; and (iii) the satisfaction
of
the agreement of the other party contained in Section 4(d) of this Agreement,
provided that it shall not be a breach of this representation where reliance
is
placed on clause (ii) and the other party does not deliver a form or document
under Section 4(a)(iii) by reason of material prejudice to its legal or
commercial position.
(B)
Party
B
makes the following representation(s):
None.
(ii) Payee
Representations.
For the
purpose of Section 3(f) of this Agreement:
(A) Party
A
makes the following representation(s):
Party
A
is a national banking association organized under the federal laws of the
United
States and its U.S. taxpayer identification number is 00-0000000.
(B)
Party
B
makes the following representation(s):
None.
|
(b)
|
Tax
Provisions.
|
|
(i)
|
Gross
Up.
Section 2(d)(i)(4) shall not apply to Party B as X, and Section
2(d)(ii)
shall not apply to Party B as Y, in each case such that Party B
shall not
be required to pay any additional amounts referred to
therein.
|
|
(ii)
|
Indemnifiable
Tax.
The definition of “Indemnifiable Tax” in Section 14 is deleted in its
entirety and replaced with the
following:
|
“Indemnifiable
Tax”
means,
in relation to payments by Party A, any Tax and, in relation to payments
by
Party B, no Tax.
Part
3. Agreement
to Deliver Documents.
(a)
For
the
purpose of Section 4(a)(i), tax forms, documents, or certificates to be
delivered are:
|
Party
required to deliver document
|
Form/Document/
Certificate
|
Date
by which to
be
delivered
|
|
Party
A
|
A
correct, complete and duly executed U.S. Internal Revenue Service
Form W-9
or other applicable form (or successor thereto), together with
appropriate
attachments, that eliminates U.S. federal withholding and backup
withholding Tax on payments to Party A under this
Agreement.
|
(i)
upon execution of this Agreement, (ii) on or before the first payment
date
under this Agreement, including any Credit Support Document, (iii)
promptly upon the reasonable demand by Party B, (iv) prior to the
expiration or obsolescence of any previously delivered form, and
(v)
promptly upon the information on any such previously delivered form
becoming inaccurate or incorrect
|
|
Party
B
|
Party
B will deliver at closing a correct, complete and duly executed
U.S.
Internal Revenue Service Form W-9 or other applicable form (or
successor
thereto), together with appropriate attachments, and may deliver
other
tax forms
relating to the beneficial owner of payments to Party B under this
Agreement from time to time
|
(i)
upon execution of this Agreement, (ii) on or before the first payment
date
under this Agreement, including any Credit Support Document, (iii)
promptly upon the reasonable demand by Party A, (iv) prior to the
expiration or obsolescence of any previously delivered form, and
(v)
promptly upon the information on any such previously delivered form
becoming inaccurate or incorrect
|
(b) For
the
purpose of Section 4(a)(ii), other documents to be delivered are:
|
Party
required to deliver document
|
Form/Document/
Certificate
|
Date
by which to
be
delivered
|
Covered
by Section 3(d) Representation
|
|
Party
A and
Party
B
|
Any
documents required by the receiving party to evidence the authority
of the
delivering party or its Credit Support Provider, if any, for it
to execute
and deliver the Agreement, this Confirmation, and any Credit Support
Documents to which it is a party, and to evidence the authority
of the
delivering party or its Credit Support Provider to perform its
obligations
under the Agreement, this Confirmation and any Credit Support Document,
as
the case may be
|
Upon
the execution and delivery of this Agreement
|
Yes
|
|
Party
A and
Party
B
|
A
certificate of an authorized officer of the party, as to the incumbency
and authority of the respective officers of the party signing the
Agreement, this Confirmation, and any relevant Credit Support Document,
as
the case may be
|
Upon
the execution and delivery of this Agreement
|
Yes
|
|
Party
A
|
Annual
Financial Statements as set forth in Party A’s Call Report containing
consolidated financial statements certified by independent certified
public accountants and prepared in accordance with generally accepted
accounting principles in the country in which Party A is
organized
|
Promptly
upon request made by Party B
|
Yes
|
|
Party
A
|
Quarterly
Financial Statements as set forth in Party A’s Call Report containing
unaudited, consolidated financial statements of Party A’s fiscal quarter
prepared in accordance with generally accepted accounting principles
in
the country in which Party A is organized
|
Promptly
upon request made by Party B
|
Yes
|
|
Party
A
|
An
opinion of counsel to Party A satisfactory in form and substance
to Party
B
|
Upon
the execution and delivery of this Agreement
|
No
|
Part
4. Miscellaneous.
|
(a)
|
Address
for Notices:
For the purposes of Section 12(a) of this
Agreement:
|
Address
for notices or communications to Party A:
Address:
000
Xxxxx Xxxxxx, Xxx Xxxx, XX 00000
Attention:
Xxxxxxxxx
XxXxxxxx
Facsimile:
000-000-0000
Telephone:
000-000-0000
Please
direct all settlement inquiries to:
HSBC
Bank USA, National Association
Derivative
Settlements
|
Attention:
|
Xxxxxxx
Xxxxxxx
|
|
Telephone:
|
(000)
000-0000
|
Fax: (000)
000-0000
(For
all
purposes)
Address
for notices or communications to Party B:
Attention:
HSBC
BANK
USA, National Association
000
Xxxxx
Xxx.
Xxx
Xxxx,
XX 00000
Facsimile: 000-000-0000
with
a
copy to:
Attention:
Xxxxx
Fargo Bank, N.A.
0000
Xxx
Xxxxxxxxx Xxxx
Xxxxxxxx,
XX 00000
Attn:
Client Manager, NHEL 2007-2
Facsimile:
000-000-0000
(For
all
purposes)
(b)
Process
Agent.
For the
purpose of Section 13(c):
Party
A
appoints as its Process Agent: Not applicable.
Party
B
appoints as its Process Agent: Not applicable.
|
(c)
|
Offices.
The provisions of Section 10(a) will apply to this Agreement; neither
Party A nor Party B has any Offices other than as set forth in
the Notices
Section and Party A agrees that, for purposes of Section 6(b) of
this
Agreement, it shall not in the future have any Office other than
one in
the United States.
|
|
(d)
|
Multibranch
Party.
For the purpose of Section 10(c) of this
Agreement:
|
Party
A
is not a Multibranch Party.
|
Party
B is not a Multibranch Party.
|
|
(e)
|
Calculation
Agent.
The Calculation Agent is Party A; provided, however, that if an
Event of
Default shall have occurred with respect to Party A, Party B shall
have
the right to appoint as Calculation Agent a third party, reasonably
acceptable to Party A, the cost for which shall be borne by Party
A.
|
(f)
Credit
Support Document.
|
Party
A:
|
The
Credit Support Annex, and any guarantee in support of Party A’s
obligations under this Agreement.
|
Party
B:
The
Credit Support Annex, solely in respect of Party B’s obligations under Paragraph
3(b) of the Credit Support Annex.
|
(g)
|
Credit
Support Provider.
|
Party
A:
The
guarantor under any guarantee in support of Party A’s obligations under this
Agreement.
Party
B:
None.
|
(h)
|
Governing
Law.
The parties to this Agreement hereby agree that the law of the
State of
New York shall govern their rights and duties in whole, without
regard to
the conflict of law provisions thereof other than New York General
Obligations Law Sections 5-1401 and 5-1402.
|
|
(i)
|
Netting
of Payments.
The parties agree that subparagraph (ii) of Section 2(c) will apply
to
each Transaction hereunder.
|
|
(j)
|
Affiliate.“Affiliate”
shall have the meaning assigned thereto in Section 14; provided,
however,
that Party A and Party B shall be deemed to have no Affiliates
for
purposes of this Agreement, including for purposes of Section
6(b)(ii).
|
Part
5. Others
Provisions.
|
(a)
|
Definitions.
Unless
otherwise specified in a Confirmation, this Agreement and each
Transaction
under this Agreement are subject to the 2000 ISDA Definitions as
published
and copyrighted in 2000 by the International Swaps and Derivatives
Association, Inc. (the “Definitions”),
and will be governed in all relevant respects by the provisions
set forth
in the Definitions, without regard to any amendment to the Definitions
subsequent to the date hereof. The provisions of the Definitions
are
hereby incorporated by reference in and shall be deemed a part
of this
Agreement, except that (i) references in the Definitions to a “Swap
Transaction” shall be deemed references to a “Transaction” for purposes of
this Agreement, and (ii) references to a “Transaction” in this Agreement
shall be deemed references to a “Swap Transaction” for purposes of the
Definitions. Each term capitalized but not defined in this Agreement
shall
have the meaning assigned thereto in the Pooling and Servicing
Agreement.
|
(b)
Amendments
to ISDA Master Agreement.
|
(i)
|
Single
Agreement.
Section 1(c) is hereby amended by the adding the words “including, for the
avoidance of doubt, the Credit Support Annex” after the words “Master
Agreement”.
|
(ii)
Conditions
Precedent. Section
2(a)(iii) is hereby amended by adding the following at the end thereof:
Notwithstanding
anything to the contrary in Section 2(a)(iii)(1), if an Event of Default
with
respect to Party B or Potential Event of Default with respect to Party B
has
occurred and been continuing for more than 30 Local Business Days and no
Early
Termination Date in respect of the Affected Transactions has occurred or
been
effectively designated by Party A, the obligations of Party A under Section
2(a)(i) shall cease to be subject to the condition precedent set forth in
Section 2(a)(iii)(1) with respect to such specific occurrence of such Event
of
Default or such Potential Event of Default (the “Specific
Event”);
provided, however, for the avoidance of doubt, the obligations of Party A
under
Section 2(a)(i) shall be subject to the condition precedent set forth in
Section
2(a)(iii)(1) (subject to the foregoing) with respect to any subsequent
occurrence of the same Event of Default with respect to Party B or Potential
Event of Default with respect to Party B after the Specific Event has ceased
to
be continuing and with respect to any occurrence of any other Event of Default
with respect to Party B or Potential Event of Default with respect to Party
B
that occurs subsequent to the Specific Event.
|
(iii)
|
Change
of Account.
Section 2(b) is hereby amended by the addition of the following
after the
word “delivery” in the first line
thereof:
|
“to
another account in the same legal and tax jurisdiction as the original
account”.
|
(iv)
|
Representations.
Section 3 is hereby amended by adding at the end thereof the following
subsection (g):
|
|
“(g)
|
Relationship
Between Parties.
|
|
(1)
|
Nonreliance.
(i) It is not relying on any statement or representation of the
other
party regarding the Transaction (whether written or oral), other
than the
representations expressly made in this Agreement or the Confirmation
in
respect of that Transaction and (ii) it has consulted with its
own legal,
regulatory, tax, business, investment, financial and accounting
advisors
to the extent it has deemed necessary, and it has made its own
investment,
hedging and trading decisions based upon its own judgment and upon
any
advice from such advisors as it has deemed necessary and not upon
any view
expressed by the other party.
|
|
(2)
|
Evaluation
and Understanding. (i) It has the capacity to evaluate (internally
or
through independent professional advice) the Transaction and has
made its
own decision to enter into the Transaction and (ii) It understands
the
terms, conditions and risks of the Transaction and is willing and
able to
accept those terms and conditions and to assume those risks, financially
and otherwise.
|
|
(3)
|
Purpose.
It is entering into the Transaction for the purposes of managing
its
borrowings or investments, hedging its underlying assets or liabilities
or
in connection with a line of business.
|
|
(4)
|
Status
of Parties. The other party is not acting as an agent, fiduciary
or
advisor for it in respect of the Transaction.
|
|
(5)
|
Eligible
Contract Participant. It is an “eligible swap participant” as such term is
defined in, Section 35.1(b)(2) of the regulations (17 C.F.R. 35)
promulgated under, and an “eligible contract participant” as defined in
Section 1(a)(12) of the Commodity Exchange Act, as
amended.”
|
|
(v)
|
Transfer
to Avoid Termination Event.
Section 6(b)(ii) is hereby amended by (i) deleting the words “or if a Tax
Event Upon Merger occurs and the Burdened Party is the Affected
Party,”
and (ii) by deleting the words “to transfer” and inserting the words “to
effect a Permitted Transfer” in lieu
thereof.
|
|
(vi)
|
Jurisdiction.
Section
13(b) is hereby amended by: (i) deleting in the second line of
subparagraph (i) thereof the word "non-", (ii) deleting “; and” from the
end of subparagraph (i) and inserting “.” in lieu thereof, and (iii)
deleting the final paragraph
thereof.
|
|
(vii)
|
Local
Business Day.
The definition of Local Business Day in Section 14 is hereby amended
by
the addition of the words “or any Credit Support Document” after “Section
2(a)(i)” and the addition of the words “or Credit Support Document” after
“Confirmation”.
|
|
(c)
|
Additional
Termination Events.
The following Additional Termination Events will
apply:
|
| (i) |
First
Rating Trigger Collateral.
If
(A) it is not the case that a Xxxxx’x Second Trigger Ratings Event has
occurred and been continuing for 30 or more Local Business Days
and (B)
Party
A has failed to comply with or perform any obligation to be complied
with
or performed by Party A in accordance with the Credit Support Annex,
then
an Additional Termination Event shall have occurred with respect
to Party
A and Party A shall be the sole Affected Party with respect to
such
Additional Termination Event.
|
| (ii) |
Second
Rating Trigger Replacement.
If
(A) a Required Ratings Downgrade Event has occurred and been continuing
for 30 or more Local Business Days and (B) (i) at least one Eligible
Replacement has made a Firm Offer to be the transferee of all of
Party A’s
rights and obligations under this Agreement (and such Firm Offer
remains
an offer that will become legally binding upon such Eligible Replacement
upon acceptance by the offeree) and/or (ii) an Eligible Guarantor
has made
a Firm Offer to provide an Eligible Guarantee (and such Firm Offer
remains
an offer that will become legally binding upon such Eligible Guarantor
immediately upon acceptance by the offeree), then an Additional
Termination Event shall have occurred with respect to Party A and
Party A
shall be the sole Affected Party with respect to such Additional
Termination Event.
|
| (iii) |
Optional
Termination of Securitization.
An
Additional Termination Event shall occur upon the notice to
Certificateholders of an optional termination becoming unrescindable
in
accordance with Article x of the Pooling and Servicing Agreement,
Party B
shall be the sole Affected Party with respect to such Additional
Termination Event; provided, however that notwithstanding anything
to the
contrary in Section 6(b)(iv), only Party B may designate an Early
Termination Date in respect of this Additional Termination Event.
|
| (iv) |
Information
Required by Regulation AB. If
Party A fails to comply with the provisions of Part 5(e) upon the
occurrence of a Swap Disclosure Event, then an Additional Termination
Event shall have occurred with respect to Party A and Party A shall
be the
sole Affected Party with respect to such Additional Termination
Event.
|
|
(d)
|
Required
Ratings Downgrade Event.
In
the event that no Relevant Entity has credit ratings at least equal
to the
Required Ratings Threshold (such event, a “Required
Ratings Downgrade Event”),
then Party A shall, as soon as reasonably practicable and so long
as a
Required Ratings Downgrade Event is in effect, at its own expense,
using
commercially reasonable efforts, procure either (A) a Permitted
Transfer
or (B) an Eligible Guarantee.
|
(e)
Compliance
with Regulation AB. (i)
For
purposes of Item 1115 of Subpart 229.1100 - Asset Backed Securities (Regulation
AB) (17 C.F.R. ss.ss.229.1100 - 229.1123) (“Regulation AB”) under the Securities
Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), as amended and interpreted by the Securities and Exchange
Commission and its staff, if the Depositor or Party B makes a determination,
acting reasonably and in good faith, that (x) the applicable “significance
percentage” with respect to this Agreement has been reached, and (y) it has a
reporting obligation under the Exchange Act (a “Swap Disclosure Event”), then
Party A shall (or shall cause its Credit Support Provider to), within ten
(10)
calendar days after notice to that effect, at its sole expense, take one
of the
following actions (each subject to satisfaction of the Rating Agency Condition):
(1) provide (including, if permitted by Regulation AB, provision by reference
to
reports filed pursuant to the Exchange Act or otherwise publicly available
information): (A) the financial data required by Item 301 of Regulation S-K
(17
C.F.R. §229.301), pursuant to Item 1115(b)(1); (B) financial statements meeting
the requirements of Regulation S-X (17 C.F.R. §§210.1-01 through 210.12-29, but
excluding 17 C.F.R. ss. 210.3-05 and Article 11 of Regulation S-X (17 C.F.R.
ss.
ss. 210.11-01 through 210.11-03)), pursuant to Item 1115(b)(2); or (C) such
other financial information as may at the time be required or permitted to
be
provided in satisfaction of the requirements of Item 1115(b), together with
accountants consents and/or a procedure letter relating thereto; or (2) secure
an Approved Replacement that is able to comply with the requirements of Item
1115(b) of Regulation AB to replace Party A as party to this Agreement, on
substantially similar terms, the debt rating of which entity (or credit support
provider therefor) meets or exceeds the applicable requirements of the
applicable Rating Agencies.
(ii)
For
so long as the aggregate significance percentage is 10% or more, Party A
shall
(or shall cause its Credit Support Provider to) provide any updates to the
information provided pursuant to clause (i)(1) above to the Depositor within
five (5) Business Days following availability thereof (but in no event more
than
45 days after the end of each of Party A’s Credit Support Provider’s fiscal half
for any half-year update, and in no event more than 90 days after the end
of
each of Party A’s Credit Support Provider’s fiscal year for any annual
update).
(iii)
All
information provided pursuant to clauses (i)(1) and (ii) above (all such
information, “Swap Financial Disclosure”) shall be in a form suitable for
conversion to the format required for filing by the Depositor with the
Commission via the Electronic Data Gathering and Retrieval System (XXXXX).
In
addition, any such information, if audited, shall be accompanied by any
necessary auditor’s consents or, if such information is unaudited, shall be
accompanied by an appropriate agreed-upon procedures letter from Party A’s
accountants. If permitted by Regulation AB, any such information may be provided
by reference to or incorporation by reference from reports filed pursuant
to the
Exchange Act.
(iv)
Party A agrees that, in the event that Party A provides Swap Financial
Disclosure to Depositor in accordance with paragraph (iii) above or causes
its
Credit Support Provider to provide Swap Financial Disclosure to Depositor
in
accordance with paragraph (iii) above, it will indemnify and hold harmless
Depositor, its respective directors or officers and any person controlling
Depositor, from and against any and all losses, claims, damages and liabilities
(any “Damage”) caused by any untrue statement or alleged untrue statement of a
material fact contained in such Swap Financial Disclosure or caused by any
omission or alleged omission to state in such Swap Financial Disclosure a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading; provided, however that the foregoing shall not apply to any Damage
caused by the negligence or any willful action of Depositor or any other
party
(other than Party A or any of its affiliates or any of their respective agents),
including without limitation any failure to calculate the Significance
Percentage according to the terms of this Agreement or to make any filing
as and
when required under Regulation AB.
(v)
Third
Party Beneficiary. The Depositor shall be an express third party beneficiary
of
this Agreement as if a party hereto to the extent of the Depositor’s rights
explicitly specified in this Part 5(e).
|
(f)
|
Transfers.
|
(i)
Section
7
is hereby amended to read in its entirety as follows:
“Except
with respect to any Permitted Transfer pursuant to Section 6(b)(ii), Part
5(d),
or the succeeding sentence, neither Party A nor Party B is permitted to assign,
novate or transfer (whether by way of security or otherwise) as a whole or
in
part any of its rights, obligations or interests under the Agreement or any
Transaction unless (a) the prior written consent of the other party is obtained,
and (b) the Rating Agency Condition has been satisfied with respect to S&P.
At any time at which no Relevant Entity has credit ratings at least equal
to the
Approved Ratings Threshold, Party A may make a Permitted Transfer.”
|
(ii)
|
If
an Eligible Replacement has made a Firm Offer (which remains an
offer that
will become legally binding upon acceptance by Party B) to be the
transferee pursuant to a Permitted Transfer, Party B shall, at
Party A’s
written request and at Party A’s expense, take any reasonable steps
required to be taken by Party B to effect such transfer.
|
|
(g)
|
Non-Recourse.
Party A acknowledges and agree that, notwithstanding any provision
in this
Agreement to the contrary, the obligations of Party B hereunder
are
limited recourse obligations of Party B, payable solely , in accordance
with the priority of payments and other terms of the Pooling and
Servicing
Agreement and that Party A will not have any recourse to any of
the
directors, officers, employees, shareholders or affiliates of the
Party B
with respect to any claims, losses, damages, liabilities, indemnities
or
other obligations in connection with any transactions contemplated
hereby.
This provision will survive the termination of this
Agreement.
|
|
(h)
|
Limitation
on Events of Default.
Notwithstanding the provisions of Sections 5 and 6, if at any time
and so
long as Party B has satisfied in full all its payment obligations
under
Section 2(a)(i) and has at the time no future payment obligations,
whether
absolute or contingent, under such Section, then unless Party A
is
required pursuant to appropriate proceedings to return to Party
B or
otherwise returns to Party B upon demand of Party B any portion
of any
such payment, (a) the occurrence of an event described in Section
5(a)
with respect to Party B shall
not constitute an Event of Default or Potential
Event of Default with respect to Party B as Defaulting Party and
(b) Party
A shall be entitled to designate an Early Termination Date pursuant
to
Section 6 only as a result of the occurrence of a Termination Event
set
forth in either Section 5(b)(i) or 5(b)(ii) with respect to Party
A as the
Affected Party, or Section 5(b)(iii) with respect to Party A as
the
Burdened Party. For purposes of the Transaction to which this Agreement
relates, Party B’s only obligation under Section 2(a)(i) is to pay the
Fixed Amount on the Fixed Amount Payer Payment
Date
|
|
(i)
|
Rating
Agency Notifications. Notwithstanding
any other provision of this Agreement, no Early Termination Date
shall be
effectively designated hereunder by Party B and no transfer of
any rights
or obligations under this Agreement shall be made by either party
unless
each Cap Rating Agency has been given prior written notice of such
designation or transfer.
|
|
(j)
|
No
Set-off.
Except as expressly provided for in Section 2(c), Section 6 or
Part
1(f)(i)(D) hereof, and notwithstanding any other provision of this
Agreement or any other existing or future agreement, each party
irrevocably waives any and all rights it may have to set off, net,
recoup
or otherwise withhold or suspend or condition payment or performance
of
any obligation between it and the other party hereunder against
any
obligation between it and the other party under any other agreements.
Section 6(e) shall be amended by deleting the following sentence:
“The
amount, if any, payable in respect of an Early Termination Date
and
determined pursuant to this Section will be subject to any
Set-off.”
|
|
(k)
|
Amendment.
Notwithstanding any provision to the contrary in this Agreement,
no
amendment of either this Agreement or any Transaction under this
Agreement
shall be permitted by either party unless each of the Cap Agencies
has
been provided prior written notice of the same and such amendment
satisfies the Rating Agency Condition with respect to
S&P.
|
|
(l)
|
Notice
of Certain Events or Circumstances.
Each Party agrees, upon learning of the occurrence or existence
of any
event or condition that constitutes (or that with the giving of
notice or
passage of time or both would constitute) an Event of Default or
Termination Event with respect to such party, promptly to give
the other
Party and to each Cap Rating Agency notice of such event or condition;
provided that failure to provide notice of such event or condition
pursuant to this Part 5(l) shall not constitute an Event of Default
or a
Termination Event.
|
(m)
Proceedings.
No
Relevant Entity shall institute against, or cause any other person to institute
against, or join any other person in instituting against Party B or the trust
created pursuant to the Pooling and Servicing Agreement, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings or other
proceedings under any federal or state bankruptcy or similar law for a period
of
one year (or, if longer, the applicable preference period) and one day following
payment in full of the Certificates and any Notes. This provision will survive
the termination of this Agreement.
|
(n)
|
Supplemental
Interest Trust Trustee Limitation of Liability. It
is expressly understood and agreed by the parties hereto that (a)
this
Agreement is executed and delivered by HSBC Bank USA, National
Association, not individually or personally but solely as the Supplemental
Interest Trust Trustee, in the exercise of the powers and authority
conferred and vested in it under the Pooling and Servicing Agreement,
(b)
the representations, warranties, covenants, undertakings and agreements
herein made on the part of the Supplemental Interest Trust are
made and
intended not as personal representations, undertakings and agreements
by
HSBC Bank USA, National Association but are made and intended for
the
purpose of binding only the Supplemental Interest Trust, (c) nothing
herein contained shall be construed as creating any liability on
HSBC Bank
USA, National Association, individually or personally, to perform
any
covenant either expressed or implied contained herein, all such
liability,
if any, being expressly waived by the parties who are signatories
to this
Agreement and by any person claiming by, through or under such
parties and
(d) under no circumstances shall HSBC Bank USA, National Association
be
personally liable for the payment of any indemnity, indebtedness,
fees or
expenses of the Supplemental Interest Trust or be liable for the
breach or
failure of any obligation, representation, warranty or covenant
made or
undertaken by the Supplemental Interest Trust under this
Agreement.
|
|
(o)
|
Severability.
If
any term, provision, covenant, or condition of this Agreement,
or the
application thereof to any party or circumstance, shall be held
to be
invalid or unenforceable (in whole or in part) in any respect,
the
remaining terms, provisions, covenants, and conditions hereof shall
continue in full force and effect as if this Agreement had been
executed
with the invalid or unenforceable portion eliminated, so long as
this
Agreement as so modified continues to express, without material
change,
the original intentions of the parties as to the subject matter
of this
Agreement and the deletion of such portion of this Agreement will
not
substantially impair the respective benefits or expectations of
the
parties; provided, however, that this severability provision shall
not be
applicable if any provision of Section 2, 5, 6, or 13 (or any definition
or provision in Section 14 to the extent it relates to, or is used
in or
in connection with any such Section) shall be so held to be invalid
or
unenforceable.
|
The
parties shall endeavor to engage in good faith negotiations to replace any
invalid or unenforceable term, provision, covenant or condition with a valid
or
enforceable term, provision, covenant or condition, the economic effect of
which
comes as close as possible to that of the invalid or unenforceable term,
provision, covenant or condition.
|
(p)
|
Agent
for Party B. Party
A acknowledges that the Securities Administrator has been appointed
as
agent under the Pooling and Servicing Agreement to carry out certain
functions on behalf of Party B, and that the Securities Administrator
shall be entitled to give notices and to perform and satisfy the
obligations of Party B hereunder on behalf of Party
B.
|
|
(q)
|
Escrow
Payments.
If
(whether by reason of the time difference between the cities in
which
payments are to be made or otherwise) it is not possible for simultaneous
payments to be made on any date on which both parties are required
to make
payments hereunder, either Party may at its option and in its sole
discretion notify the other Party that payments on that date are
to be
made in escrow. In this case deposit of the payment due earlier
on that
date shall be made by 2:00 pm (local time at the place for the
earlier
payment) on that date with an escrow agent selected by the notifying
party, accompanied by irrevocable payment instructions (i) to release
the
deposited payment to the intended recipient upon receipt by the
escrow
agent of the required deposit of any corresponding payment payable
by the
other party on the same date accompanied by irrevocable payment
instructions to the same effect or (ii) if the required deposit
of the
corresponding payment is not made on that same date, to return
the payment
deposited to the party that paid it into escrow. The party that
elects to
have payments made in escrow shall pay all costs of the escrow
arrangements.
|
|
(r)
|
Consent
to Recording.
Each party hereto consents to the monitoring or recording, at any
time and
from time to time, by the other party of any and all communications
between trading, marketing, and operations personnel of the parties
and
their Affiliates, waives any further notice of such monitoring
or
recording, and agrees to notify such personnel of such monitoring
or
recording.
|
|
(s)
|
Waiver
of Jury Trial.
Each party waives any right it may have to a trial by jury in respect
of
any in respect of any suit, action or proceeding relating to this
Agreement or any Credit Support Document.
|
|
(t)
|
Form
of ISDA Master Agreement. Party
A and Party B hereby agree that the text of the body of the ISDA
Master
Agreement is intended to be the printed form of the ISDA Master
Agreement
(Multicurrency - Crossborder) as published and copyrighted in 1992
by the
International Swaps and Derivatives Association,
Inc.
|
|
(u)
|
Payment
Instructions.
Party A hereby agrees that, unless notified in writing by Party
B of other
payment instructions, any and all amounts payable by Party A to
Party B
under this Agreement shall be paid to the account specified in
Item 4 of
this Confirmation, below.
|
|
(v)
|
Additional
representations.
|
|
(i)
|
Representations
of Party A.
Party A represents to Party B on the date on which Party A enters
into
each Transaction that:--
|
|
(1)
|
Party
A’s obligations under this Agreement rank pari passu with all of
Party A’s
other unsecured, unsubordinated obligations except those obligations
preferred by operation of law.
|
|
(2)
|
Party
A is a bank subject to the requirements of 12 U.S.C. § 1823(e), its
execution, delivery and performance of this Agreement (including
the
Credit Support Annex and each Confirmation) have been approved
by its
board of directors or its loan committee, such approval is reflected
in
the minutes of said board of directors or loan committee, and this
Agreement (including the Credit Support Annex and each Confirmation)
will
be maintained as one of its official records continuously from
the time of
its execution (or in the case of any Confirmation, continuously
until such
time as the relevant Transaction matures and the obligations therefor
are
satisfied in full).
|
|
(ii)
|
Capacity.
Party A represents to Party B on the date on which Party A enters
into
this Agreement that it is entering into the Agreement and the Transaction
as principal and not as agent of any person. The Supplemental Interest
Trust Trustee represents to Party A on the date on which the Supplemental
Interest Trust Trustee executes this Agreement that it is executing
the
Agreement in its capacity as Supplemental Interest Trust
Trustee.
|
|
(w)
|
Acknowledgements.
|
|
(ii)
|
Bankruptcy
Code.
Subject to Part 5(m), without limiting the applicability if any,
of any
other provision of the U.S. Bankruptcy Code as amended (the “Bankruptcy
Code”) (including without limitation Sections 362, 546, 556, and 560
thereof and the applicable definitions in Section 101 thereof),
the
parties acknowledge and agree that all Transactions entered into
hereunder
will constitute “forward contracts” or “swap agreements” as defined in
Section 101 of the Bankruptcy Code or “commodity contracts” as defined in
Section 761 of the Bankruptcy Code, that the rights of the parties
under
Section 6 of this Agreement will constitute contractual rights
to
liquidate Transactions, that any margin or collateral provided
under any
margin, collateral, security, pledge, or similar agreement related
hereto
will constitute a “margin payment” as defined in Section 101 of the
Bankruptcy Code, and that the parties are entities entitled to
the rights
under, and protections afforded by, Sections 362, 546, 556, and
560 of the
Bankruptcy Code.
|
| (x) |
[Reserved]
|
| (y) |
Third
Party Beneficiary.
Xxxxx Fargo Bank, N.A. is a third party beneficiary of this agreement
and
is entitled to the rights and benefits hereunder and may enforce
the
provisions hereof as if were a party
hereto.
|
(z)
Additional
Definitions.
As
used
in this Agreement, the following terms shall have the meanings set forth
below,
unless the context clearly requires otherwise:
“Approved
Ratings Threshold”
means
each of the S&P Approved Ratings Threshold, the Moody’s First Trigger
Ratings Threshold and the DBRS Approved Ratings Threshold.
“Approved
Replacement” means,
with respect to a Market Quotation, an entity making such Market Quotation,
which entity would satisfy conditions (a), (b), (c) and (d) of the definition
of
Permitted Transfer (as determined by Party B in its sole discretion, acting
in a
commercially reasonable manner) if such entity were a Transferee, as defined
in
the definition of Permitted Transfer.
“Cap
Rating Agencies”
means,
with respect to any date of determination, each of Moody’s, DBRS and
S&P,
to the
extent that each such rating agency is then providing a rating for any of
the
Nomura
Home Equity Loan, Inc., Home Equity Loan Trust, Series 2007-2 (the
“Certificates”) or any notes backed by the Certificates (the
“Notes”).
“DBRS”
means
Dominion Bond Rating Service, or any successor thereto.
“DBRS
Approved Ratings Threshold” means,
with respect to Party A, the guarantor under an Eligible Guarantee, or an
Eligible Replacement, a long-term unsecured and unsubordinated debt rating
from
DBRS of “AA(low)” and a short-term unsecured and unsubordinated debt rating from
DBRS of “R-1(middle)”.
“DBRS
Required Ratings Threshold” means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, a long-term unsecured and unsubordinated debt rating
from
DBRS of “BBB”.
“Derivative
Provider Trigger Event”
means
(i) an Event of Default with respect to which Party A is a Defaulting Party,
(ii) a Termination Event with respect to which Party A is the sole Affected
Party or (iii) an Additional Termination Event with respect to which Party
A is
the sole Affected Party.
“Eligible
Guarantee”
means an
unconditional and irrevocable guarantee of all present and future obligations
(for the avoidance of doubt, not limited to payment obligations) of Party
A or
an Eligible Replacement to Party B under this Agreement that is provided
by an
Eligible Guarantor as principal debtor rather than surety and that is directly
enforceable by Party B, the form and substance of which guarantee are subject
to
the Rating Agency Condition with respect to S&P, and either (A) a law firm
has given a legal opinion confirming that none of the guarantor’s payments to
Party B under such guarantee will be subject to Tax
collected by withholding or
(B)
such guarantee provides that, in the event that any of such guarantor’s payments
to Party B are subject to Tax collected by withholding, such guarantor is
required to pay such additional amount as is necessary to ensure that the
net
amount actually received by Party B (free and clear of any Tax collected
by
withholding) will equal the full amount Party B would have received had no
such
withholding been required.
“Eligible
Guarantor” means
an
entity that (A) has credit ratings at least equal to the S&P Approved
Ratings Threshold and the DBRS
Approved Ratings Threshold and (B) has credit ratings from Moody’s at least
equal to the Moody’s Second Trigger Ratings Threshold, provided, for the
avoidance of doubt, that an Eligible Guarantee of an Eligible Guarantor with
credit ratings below the Moody’s First Trigger Ratings Threshold will not cause
a Collateral Event (as defined in the Credit Support Annex) not to occur
or
continue with respect to Moody’s.
“Eligible
Replacement”
means an
entity (i) (a) that has credit ratings at least equal to the S&P Approved
Ratings Threshold and the DBRS
Approved Ratings Threshold, and (b) has credit ratings from Moody’s at least
equal to the Moody’s Second Trigger Ratings Threshold, provided, for the
avoidance of doubt, that an Eligible Replacement with credit ratings below
the
Moody’s First Trigger Ratings Threshold will not cause a Collateral Event (as
defined in the Credit Support Annex) not to occur or continue with respect
to
Moody’s, or (ii) the present and future obligations (for the avoidance of doubt,
not limited to payment obligations) of which entity to Party B under this
Agreement are guaranteed pursuant to an Eligible Guarantee.
“Firm
Offer”
means
(A) with respect to an Eligible Replacement, a quotation from such Eligible
Replacement (i) in an amount equal to the actual amount payable by or to
Party B
in consideration of an agreement between Party B and such Eligible Replacement
to replace Party A as the counterparty to this Agreement by way of novation
or,
if such novation is not possible, an agreement between Party B and such Eligible
Replacement to enter into a Replacement Transaction (assuming that all
Transactions hereunder become Terminated Transactions), and (ii) that
constitutes an offer by such Eligible Replacement to replace Party A as the
counterparty to this Agreement or enter a Replacement Transaction that will
become legally binding upon such Eligible Replacement upon acceptance by
Party
B, and (B) with respect to an Eligible Guarantor, an offer by such Eligible
Guarantor to provide an Eligible Guarantee that will become legally binding
upon
such Eligible Guarantor upon acceptance by the offeree.
“Moody’s”
means
Xxxxx’x Investors Service, Inc., or any successor thereto.
“Moody’s
Second Trigger Ratings Event”
means
that no Relevant Entity has credit ratings from Moody’s at least equal to the
Moody’s Second Trigger Ratings Threshold.
“Permitted
Transfer” means
a
transfer by novation by Party A pursuant to Section 6(b)(ii), Part 5(d),
or the
second sentence of Section 7 (as amended herein) to a transferee (the
“Transferee”)
of all,
but not less than all, of Party A’s rights, liabilities, duties and obligations
under this Agreement, with
respect to which transfer each of the following conditions is
satisfied:
(a) the
Transferee is an Eligible Replacement; (b) Party A and the Transferee are
both
“dealers in notional principal contracts” within the meaning of Treasury
regulations section 1.1001-4; (c) as of the date of such transfer the Transferee
would not be required to withhold or deduct on account of Tax from any payments
under this Agreement or would be required to gross up for such Tax under
Section
2(d)(i)(4); (d) an Event of Default or Termination Event would not occur
as a
result of such transfer; (e) pursuant to a written instrument (the “Transfer
Agreement”),
the
Transferee acquires and assumes all rights and obligations of Party A under
the
Agreement and the relevant Transaction; (f) Party B shall have determined,
in
its sole discretion, acting in a commercially reasonable manner, that such
Transfer Agreement is effective to transfer to the Transferee all, but not
less
than all, of Party A’s rights and obligations under the Agreement and all
relevant Transactions; (g) Party A will be responsible for any costs or expenses
incurred in connection with such transfer (including any replacement cost
of
entering into a replacement transaction); (h) either (A) Moody’s has been given
prior written notice of such transfer and the Rating Agency Condition is
satisfied with respect to S&P or (B) each Swap Rating Agency has been given
prior written notice of such transfer and such transfer is in connection
with
the assignment and assumption of this Agreement without modification of its
terms, other than party names, dates relevant to the effective date of such
transfer, tax representations (provided that the representations in Part
2(a)(i)
are not modified) and any other representations regarding the status of the
substitute counterparty of the type included in Part 5(b)(iv), Part 5(v)(i)(2)
or Part 5(v)(ii), notice information and account details; and such transfer
otherwise complies with the terms of the Pooling and Servicing
Agreement.
“Rating
Agency Condition”
means,
with respect to any particular proposed act or omission to act hereunder
and
each Cap Rating Agency specified in connection with such proposed act or
omission, that the party acting or failing to act must consult with each
of the
specified Cap Rating Agencies and receive from each such Cap Rating Agency
a
prior written confirmation that the proposed action or inaction would not
cause
a downgrade or withdrawal of the then-current rating of any Certificates
or
Notes.
“Relevant
Entity” means
Party A and, to the extent applicable, a guarantor under an Eligible
Guarantee.
“Replacement
Transaction”
means,
with respect to any Terminated Transaction or group of Terminated Transactions,
a transaction or group of transactions that (i) would have the effect of
preserving for Party B the economic equivalent of any payment or delivery
(whether the underlying obligation was absolute or contingent and assuming
the
satisfaction of each applicable condition precedent) by the parties under
Section 2(a)(i) in respect of such Terminated Transaction or group of Terminated
Transactions that would, but for the occurrence of the relevant Early
Termination Date, have been required after that Date, and (ii) has terms
which
are substantially the same as this Agreement, including, without limitation,
rating triggers, Regulation AB compliance, and credit support documentation,
save for the exclusion of provisions relating to Transactions that are not
Terminated Transaction, as determined by Party B in its sole discretion,
acting
in a commercially reasonable manner.
“Required
Ratings Downgrade Event”
shall
have the meaning assigned thereto in Part 5(d).
“Required
Ratings Threshold” means
each of the S&P Required Ratings Threshold, the Moody’s Second Trigger
Ratings Threshold and the DBRS Required Ratings Threshold.
“S&P”
means
Standard & Poor's Rating Services, a division of The XxXxxx-Xxxx Companies,
Inc., or any successor thereto.
“S&P
Required Ratings Threshold”
means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, a long-term unsecured and unsubordinated debt rating
from
S&P of “BBB+”.
[Remainder
of this page intentionally left blank.]
4.
Account
Details and Settlement Information:
Payments
to Party
A:
HSBC
Bank
USA, National Association
ABA
#
000-000-000
For
credit to Department 299
A/C:
000-00000-0
HSBC
Derivative Products Group
Payments
to Party
B:
Xxxxx
Fargo Bank, N.A.
ABA
#
000-000-000
For
Credit to: SAS Clearing
A/C:
0000000000
FFC:
NHEL
2007-2, Supplemental Interest Trust, #50984601
This
Agreement may be executed in several counterparts, each of which shall be
deemed
an original but all of which together shall constitute one and the same
instrument.
We
are
very pleased to have executed this Transaction with you and we look forward
to
completing other transactions with you in the near future.
Very
truly yours,
HSBC
BANK
USA, NATIONAL ASSOCIATION
By:
/s/
Xxxxxxx Xxxxxxxx
Name:
Xxxxxxx Xxxxxxxx
Title:
Assistant Vice President
By:
/s/
Xxxxxxxx Xxxxxxx
Name:
Xxxxxxxx Xxxxxxx
Title:
Vice President
Party
B,
acting through its duly authorized signatory, hereby agrees to, accepts and
confirms the terms of the foregoing as of the date hereof.
HSBC
BANK
USA, NATIONAL ASSOCIATION, NOT INDIVIDUALLY, BUT SOLELY AS SUPPLEMENTAL INTEREST
TRUST TRUSTEE ON BEHALF OF THE SUPPLEMENTAL INTEREST TRUST WITH RESPECT TO
THE
NOMURA HOME EQUITY LOAN, INC., HOME EQUITY LOAN TRUST, SERIES
2007-2
By:
/s/
Xxxxx Xxxxx
Name: Xxxxx
Xxxxx
Title:
Assistant Vice President
SCHEDULE
I
(all
such
dates subject to adjustment in accordance with the Following Business Day
Convention)
|
For
the Calculation Periods
|
Notional
Amount
|
|
|
From
and including:
|
To
but excluding the
|
in
USD:
|
|
The
Effective Date
|
August
25, 2008
|
27,325,000.00
|
|
August
25, 2008
|
September
25, 2008
|
86,217,000.00
|
|
September
25, 2008
|
October
25, 2008
|
84,411,000.00
|
|
October
25, 2008
|
November
25, 2008
|
72,590,000.00
|
|
November
25, 2008
|
December
25, 2008
|
121,704,000.00
|
|
December
25, 2008
|
January
25, 2009
|
113,263,000.00
|
|
January
25, 2009
|
February
25, 2009
|
99,826,000.00
|
|
February
25, 2009
|
March
25, 2009
|
88,297,000.00
|
|
March
25, 2009
|
April
25, 2009
|
78,014,000.00
|
|
April
25, 2009
|
May
25, 2009
|
71,140,000.00
|
|
May
25, 2009
|
June
25, 2009
|
65,371,000.00
|
|
June
25, 2009
|
July
25, 2009
|
59,943,000.00
|
|
July
25, 2009
|
August
25, 2009
|
58,830,000.00
|
|
August
25, 2009
|
September
25, 2009
|
59,380,000.00
|
|
September
25, 2009
|
October
25, 2009
|
55,617,000.00
|
|
October
25, 2009
|
November
25, 2009
|
51,178,000.00
|
|
November
25, 2009
|
December
25, 2009
|
49,542,000.00
|
|
December
25, 2009
|
January
25, 2010
|
46,238,000.00
|
|
January
25, 2010
|
February
25, 2010
|
41,575,000.00
|
|
February
25, 2010
|
March
25, 2010
|
44,023,000.00
|
|
March
25, 2010
|
April
25, 2010
|
46,377,000.00
|
|
April
25, 2010
|
May
25, 2010
|
48,641,000.00
|
|
May
25, 2010
|
June
25, 2010
|
50,818,000.00
|
|
June
25, 2010
|
July
25, 2010
|
48,647,000.00
|
|
July
25, 2010
|
August
25, 2010
|
45,773,000.00
|
|
August
25, 2010
|
September
25, 2010
|
43,068,000.00
|
|
September
25, 2010
|
October
25, 2010
|
40,520,000.00
|
|
October
25, 2010
|
November
25, 2010
|
38,122,000.00
|
|
November
25, 2010
|
December
25, 2010
|
35,877,000.00
|
|
December
25, 2010
|
January
25, 2011
|
33,751,000.00
|
|
January
25, 2011
|
February
25, 2011
|
31,749,000.00
|
|
February
25, 2011
|
March
25, 2011
|
29,888,000.00
|
|
March
25, 2011
|
April
25, 2011
|
28,112,000.00
|
|
April
25, 2011
|
May
25, 2011
|
26,441,000.00
|
|
May
25, 2011
|
June
25, 2011
|
24,915,000.00
|
|
June
25, 2011
|
July
25, 2011
|
23,426,000.00
|
|
July
25, 2011
|
August
25, 2011
|
21,818,000.00
|
|
August
25, 2011
|
September
25, 2011
|
20,434,000.00
|
|
September
25, 2011
|
October
25, 2011
|
19,032,000.00
|
|
October
25, 2011
|
November
25, 2011
|
17,708,000.00
|
|
November
25, 2011
|
December
25, 2011
|
16,660,000.00
|
|
December
25, 2011
|
The
Termination Date
|
15,492,000.00
|
Annex
A
Paragraph
13 of the Credit Support Annex
ISDA®
CREDIT
SUPPORT ANNEX
to
the
Schedule to the
ISDA
Master Agreement
dated
as
of January 31, 2007 between
HSBC
Bank
USA, National Association (hereinafter referred to as “Party
A”
or
“Pledgor”)
and
HSBC
Bank
USA, National Association, not individually, but solely as Supplemental Interest
Trust Trustee on behalf of the Supplemental Interest Trust with respect to
the
Nomura Home Equity Loan, Inc., Home Equity Loan Trust, Series 2007-2
(hereinafter referred to as “Party
B”
or
“Secured
Party”).
For
the
avoidance of doubt, and notwithstanding anything to the contrary that may
be
contained in the Agreement, this Credit Support Annex shall relate solely
to the
Transaction documented in the Confirmation dated January 31, 2007 between
Party
A and Party B, Reference Number 453999HN/454000HN.
Paragraph
13. Elections and Variables.
| (a) |
Security
Interest for “Obligations”.
The term “Obligations”
as
used in this Annex includes the following additional
obligations:
|
With
respect to Party A: not applicable.
With
respect to Party B: not applicable.
| (b) |
Credit
Support Obligations.
|
| (i) |
Delivery
Amount, Return Amount and Credit Support
Amount.
|
| (A) |
“Delivery
Amount”
has the meaning specified in Paragraph 3(a) as amended (I) by deleting
the
words “upon a demand made by the Secured Party on or promptly following
a
Valuation Date” and inserting in lieu thereof the words “not later than
the close of business on each Valuation Date” and (II) by deleting in its
entirety the sentence beginning “Unless otherwise specified in Paragraph
13” and ending “(ii) the Value as of that Valuation Date of all Posted
Credit Support held by the Secured Party.” and inserting in lieu thereof
the following:
|
The
“Delivery
Amount”
applicable to the Pledgor for any Valuation Date will equal the greatest
of
|
(1)
|
the
amount by which (a) the S&P/DBRS Credit Support Amount for such
Valuation Date exceeds (b) the S&P/DBRS Value as of such Valuation
Date of all Posted Credit Support held by the Secured Party,
|
|
(2)
|
the
amount by which (a) the Moody’s First Trigger Credit Support Amount for
such Valuation Date exceeds (b) the Moody’s First Trigger Value as of such
Valuation Date of all Posted Credit Support held by the Secured
Party,
and
|
|
(3)
|
the
amount by which (a) the Moody’s Second Trigger Credit Support Amount for
such Valuation Date exceeds (b) the Moody’s Second Trigger Value as of
such Valuation Date of all Posted Credit Support held by the Secured
Party.
|
| (B) |
“Return
Amount”
has the meaning specified in Paragraph 3(b) as amended by deleting
in its
entirety the sentence beginning “Unless otherwise specified in Paragraph
13” and ending “(ii) the Credit Support Amount.” and inserting in lieu
thereof the following:
|
The
“Return
Amount”
applicable to the Secured Party for any Valuation Date will equal the least
of
|
(1)
|
the
amount by which (a) the S&P/DBRS Value as of such Valuation Date of
all Posted Credit Support held by the Secured Party exceeds (b)
the
S&P/DBRS Credit Support Amount for such Valuation Date,
|
|
(2)
|
the
amount by which (a) the Xxxxx’x First Trigger Value as of such Valuation
Date of all Posted Credit Support held by the Secured Party exceeds
(b)
the Xxxxx’x First Trigger Credit Support Amount for such Valuation Date,
and
|
|
(3)
|
the
amount by which (a) the Xxxxx’x Second Trigger Value as of such Valuation
Date of all Posted Credit Support held by the Secured Party exceeds
(b)
the Xxxxx’x Second Trigger Credit Support Amount for such Valuation
Date.
|
| (C) |
“Credit
Support Amount”
shall not apply. For purposes of calculating any Delivery Amount
or Return
Amount for any Valuation Date, reference shall be made to the S&P/DBRS
Credit Support Amount, the Xxxxx’x First Trigger Credit Support Amount, or
the Xxxxx’x Second Trigger Credit Support Amount, in each case for such
Valuation Date, as provided in Paragraphs 13(b)(i)(A) and 13(b)(i)(B),
above.
|
| (ii) |
Eligible
Collateral.
|
On
any
date, the items set forth in Schedule I will qualify as “Eligible
Collateral”
(for
the avoidance of doubt, all Eligible Collateral to be denominated in
USD).
| (iii) |
Other
Eligible Support.
|
The
following items will qualify as “Other
Eligible Support”
for the
party specified:
Not
applicable.
| (iv) |
Threshold.
|
| (A) |
“Independent
Amount”
means zero with respect to Party A and Party
B.
|
| (B) |
“Threshold”
means, with respect to Party A and any Valuation Date, zero if (i)
a
Collateral Event has occurred and has been continuing (x) for at
least 30
days or (y) since this Annex was executed, or (ii) a Required Ratings
Downgrade Event has occurred and is continuing; otherwise,
infinity.
|
“Threshold”
means,
with respect to Party B and any Valuation Date, infinity.
| (C) |
“Minimum
Transfer Amount” means
USD 50,000 with respect to Party A and Party
B.
|
| (D) |
Rounding:
The Delivery Amount will be rounded up to the nearest integral multiple
of
USD 10,000. The Return Amount will be rounded down to the nearest
integral
multiple of USD 10,000.
|
| (c) |
Valuation
and Timing.
|
| (i) |
“Valuation
Agent”
means Party A; provided, however, that if an Event of Default shall
have
occurred with respect to which Party A is the Defaulting Party, Party
B
shall have the right to designate as Valuation Agent an independent
party,
reasonably acceptable to Party A, the cost for which shall be borne
by
Party A. All calculations by the Valuation Agent must be made in
accordance with standard market practice, including, in the event
of a
dispute as to the Value of any Eligible Credit Support or Posted
Credit
Support, by making reference to quotations received by the Valuation
Agent
from one or more Pricing Sources.
|
| (ii) |
“Valuation
Date” means
each Local Business Day on which any of the S&P/DBRS Credit Support
Amount, the Xxxxx’x First Trigger Credit Support Amount or the Xxxxx’x
Second Trigger Credit Support Amount is greater than
zero.
|
| (iii) |
“Valuation
Time” means
the close of business in the city of the Valuation Agent on the Local
Business Day immediately preceding the Valuation Date or date of
calculation, as applicable; provided
that the calculations of Value and Exposure will be made as of
approximately the same time on the same date. The Valuation Agent
will
notify each party (or the other party, if the Valuation Agent is
a party)
of its calculations not later than the Notification Time on the applicable
Valuation Date (or in the case of Paragraph 6(d), the Local Business
Day
following the day on which such relevant calculations are
performed).”
|
| (iv) |
“Notification
Time” means
11:00 a.m., New York time, on a Local Business Day.
|
| (v) |
External
Verification.
Notwithstanding anything to the contrary in the definitions of Valuation
Agent or Valuation Date, at any time at which Party A (or, to the
extent
applicable, its Credit Support Provider) does not have a long-term
unsubordinated and unsecured debt rating of at least “BBB+” from S&P,
the Valuation Agent shall (A) calculate the Secured Party’s Exposure and
the S&P/DBRS Value of Posted Credit Suppport on each Valuation Date
based on internal marks and (B) verify such calculations with external
marks monthly by obtaining on the last Local Business Day of each
calendar
month two external marks for each Transaction to which this Annex
relates
and for all Posted Credit Suport; such verification of the Secured
Party’s
Exposure shall be based on the higher of the two external marks.
Each
external xxxx in respect of a Transaction shall be obtained from
an
independent Reference Market-maker that would be eligible and willing
to
enter into such Transaction in the absence of the current derivative
provider, provided that an external xxxx xxx not be obtained from
the same
Reference Market-maker more than four times in any 12-month period.
The
Valuation Agent shall obtain these external marks directly or through
an
independent third party, in either case at no cost to Party B. The
Valuation Agent shall calculate on each Valuation Date (for purposes
of
this paragraph, the last Local Business Day in each calendar month
referred to above shall be considered a Valuation Date) the Secured
Party’s Exposure based on the greater of the Valuation Agent’s internal
marks and the external marks received. If the S&P/DBRS Value on any
such Valuation Date of all Posted Credit Support then held by the
Secured
Party is less than the S&P/DBRS Credit Support Amount on such
Valuation Date (in each case as determined pursuant to this paragraph),
Party A shall, within three Local Business Days of such Valuation
Date,
Transfer to the Secured Party Eligible Credit Support having an
S&P/DBRS Value as of the date of Transfer at least equal to such
deficiency.
|
| (vi) |
Notice
to S&P.
At
any time at which Party A (or, to the extent applicable, its Credit
Support Provider) does not have a long-term unsubordinated and unsecured
debt rating of at least “BBB+” from S&P, the Valuation Agent shall
provide to S&P not later than the Notification Time on the Local
Business Day following each Valuation Date its calculations of the
Secured
Party’s Exposure and the S&P/DBRS Value of any Eligible Credit Support
or Posted Credit Support for that Valuation Date. The Valuation Agent
shall also provide to S&P any external marks received pursuant to the
preceding paragraph.
|
| (d) |
Conditions
Precedent and Secured Party’s Rights and
Remedies.
The following Termination Events will be a “Specified
Condition”
for the party specified (that party being the Affected Party if the
Termination Event occurs with respect to that party): With respect
to
Party A: any Additional Termination Event with respect to which Party
A is
the sole Affected Party. With respect to Party B:
None.
|
| (e) |
Substitution.
|
| (i) |
“Substitution
Date”
has the meaning specified in Paragraph
4(d)(ii).
|
| (ii) |
Consent.
If
specified here as applicable, then the Pledgor must obtain the Secured
Party’s consent for any substitution pursuant to Paragraph 4(d):
Inapplicable.
|
| (f) |
Dispute
Resolution.
|
| (i) |
“Resolution
Time”
means 1:00 p.m. New York time on the Local Business Day following
the date
on which the notice of the dispute is given under Paragraph
5.
|
| (ii) |
Value.
Notwithstanding anything to the contrary in Paragraph 12, for the
purpose
of Paragraphs 5(i)(C) and 5(ii), the S&P/DBRS Value, Xxxxx’x First
Trigger Value, and Xxxxx’x Second Trigger Value, on any date, of Eligible
Collateral other than Cash will be calculated as follows:
|
For
Eligible Collateral in the form of securities listed in Paragraph 13(b)(ii):
the
sum of (A) the product of (1)(x) the bid price at the Valuation Time for
such
securities on the principal national securities exchange on which such
securities are listed, or (y) if such securities are not listed on a national
securities exchange, the bid price for such securities quoted at the Valuation
Time by any principal market maker for such securities selected by the Valuation
Agent, or (z) if no such bid price is listed or quoted for such date, the
bid
price listed or quoted (as the case may be) at the Valuation Time for the
day
next preceding such date on which such prices were available and (2) the
applicable Valuation Percentage for such Eligible Collateral, and (B) the
accrued interest on such securities (except to the extent Transferred to
the
Pledgor pursuant to Paragraph 6(d)(ii) or included in the applicable price
referred to in the immediately preceding clause (A)) as of such
date.
| (iii) |
Alternative.
The provisions of Paragraph 5 will apply.
|
| (g) |
Holding
and Using Posted
Collateral.
|
| (i) |
Eligibility
to Hold Posted Collateral; Custodians. Party
B (or any Custodian) will be entitled to hold Posted Collateral pursuant
to Paragraph 6(b).
|
Party
B
may appoint as Custodian (A) the entity then serving as Securities Administrator
or (B) any entity other than the entity then serving as Securities Administrator
if such other entity (or, to the extent applicable, its parent company or
credit
support provider) shall then have a short-term unsecured and unsubordinated
debt
rating from S&P of at least “A-1.”
Initially,
the Custodian
for
Party B is: Securities Administrator.
| (ii) |
Use
of Posted Collateral. The
provisions of Paragraph 6(c)(i) will not apply to Party B, but the
provisions of Paragraph 6(c)(ii) will apply to Party B.
|
| (h) |
Distributions
and Interest Amount.
|
| (i) |
Interest
Rate.
The “Interest
Rate”
will be the actual interest rate earned on Posted Collateral in the
form
of Cash that is held by Party B or its Custodian. Posted Collateral
in the
form of Cash shall be invested in such overnight (or redeemable within
two
Local Business Days of demand) Permitted Investments rated at least
(x)
AAAm or AAAm-G by S&P and (y) Prime-1 by Xxxxx’x or Aaa by Xxxxx’x, as
directed by Party A (unless (x) an Event of Default or an Additional
Termination Event has occurred with respect to which Party A is the
defaulting or sole Affected Party or (y) an Early Termination Date
has
been designated, in which case such investment shall be held uninvested).
Gains and losses incurred in respect of any investment of Posted
Collateral in the form of Cash in Permitted Investments as directed
by
Party A shall be for the account of Party
A.
|
| (ii) |
Transfer
of Interest Amount.
The Transfer of the Interest Amount will be made on the second Local
Business Day following the end of each calendar month and on any
other
Local Business Day on which Posted Collateral in the form of Cash
is
Transferred to the Pledgor pursuant to Paragraph 3(b); provided,
however,
that the obligation of Party B to Transfer any Interest Amount to
Party A
shall be limited to the extent that Party B has earned and received
such
funds and such funds are available to Party B.
|
| (iii) |
Alternative
to Interest Amount.
The provisions of Paragraph 6(d)(ii) will
apply.
|
| (i) |
Additional
Representation(s).
There are no additional representations by either
party.
|
| (j) |
Other
Eligible Support and Other Posted Support.
|
| (i) |
“Value”
with respect to Other Eligible Support and Other Posted Support means:
not
applicable.
|
| (ii) |
“Transfer”
with respect to Other Eligible Support and Other Posted Support means:
not
applicable.
|
| (k) |
Demands
and Notices.All
demands, specifications and notices under this Annex will be made
pursuant
to the Notices Section of this Agreement, except that any demand,
specification or notice shall be given to or made at the following
addresses, or at such other address as the relevant party may from
time to
time designate by giving notice (in accordance with the terms of
this
paragraph) to the other party:
|
If
to
Party A, at the address specified pursuant to the Notices Section of this
Agreement.
If
to
Party B, at the address specified pursuant to the Notices Section of this
Agreement.
If
to
Party B’s Custodian:
Xxxxx
Fargo Bank, N.A.
0000
Xxx
Xxxxxxxxx Xxxx
Xxxxxxxx,
Xxxxxxxx 00000
Attn:
Client Manager - NHEL 2007-2
Tel:
000-000-0000
Fax:
000-000-0000
| (l) |
Address
for Transfers.
Each Transfer hereunder shall be made to the address specified below
or to
an address specified in writing from time to time by the party to
which
such Transfer will be made.
|
Party
A
account details for holding collateral:
HSBC
Bank
USA, National Association
ABA
#
000-000-000
For
credit to Department 299
A/C:
000-00000-0
HSBC
Derivative Products Group
Party
B’s
Custodian account details for holding collateral
Xxxxx
Fargo Bank, N.A.
ABA
#
000-000-000
For
Credit to: SAS Clearing
A/C:
0000000000
FFC:
NHEL 2007-2, Posted Collateral Account, # 00000000
| (m) |
Other
Provisions.
|
| (i) |
Collateral
Account.
Party B shall open and maintain a segregated account, which shall
be an
Eligible Account, and hold, record and identify all Posted Collateral
in
such segregated account.
|
| (ii) |
Agreement
as to Single Secured Party and Single Pledgor.
Party A and Party B hereby agree that, notwithstanding anything to
the
contrary in this Annex, (a) the term “Secured Party” as used in this Annex
means only Party B, (b) the term “Pledgor” as used in this Annex means
only Party A, (c) only Party A makes the pledge and grant in Paragraph
2,
the acknowledgement in the final sentence of Paragraph 8(a) and the
representations in Paragraph 9.
|
| (iii) |
Calculation
of Value.
Paragraph 4(c) is hereby amended by deleting the word “Value” and
inserting in lieu thereof “S&P/DBRS Value, Xxxxx’x First Trigger
Value, Xxxxx’x Second Trigger Value”. Paragraph 4(d)(ii) is hereby amended
by (A) deleting the words “a Value” and inserting in lieu thereof “an
S&P/DBRS Value, Xxxxx’x First Trigger Value, and Xxxxx’x Second
Trigger Value” and (B) deleting the words “the Value” and inserting in
lieu thereof “S&P/DBRS Value, Xxxxx’x First Trigger Value, and Xxxxx’x
Second Trigger Value”. Paragraph 5 (flush language) is hereby amended by
deleting the word “Value” and inserting in lieu thereof “S&P/DBRS
Value, Xxxxx’x First Trigger Value, or Xxxxx’x Second Trigger Value”.
Paragraph 5(i) (flush language) is hereby amended by deleting the
word
“Value” and inserting in lieu thereof “S&P/DBRS Value, Xxxxx’x First
Trigger Value, and Xxxxx’x Second Trigger Value”. Paragraph 5(i)(C) is
hereby amended by deleting the word “the Value, if” and inserting in lieu
thereof “any one or more of the S&P/DBRS Value, Xxxxx’x First Trigger
Value, or Xxxxx’x Second Trigger Value, as may be”. Paragraph 5(ii) is
hereby amended by (1) deleting the first instance of the words “the Value”
and inserting in lieu thereof “any one or more of the S&P/DBRS Value,
Xxxxx’x First Trigger Value, or Xxxxx’x Second Trigger Value” and (2)
deleting the second instance of the words “the Value” and inserting in
lieu thereof “such disputed S&P/DBRS Value, Xxxxx’x First Trigger
Value, or Xxxxx’x Second Trigger Value”. Each of Paragraph 8(b)(iv)(B) and
Paragraph 11(a) is hereby amended by deleting the word “Value” and
inserting in lieu thereof “least of the S&P/DBRS Value, Xxxxx’x First
Trigger Value, and Xxxxx’x Second Trigger Value”.
|
| (iv) |
Form
of Annex. Party
A and Party B hereby agree that the text of Paragraphs 1 through
12,
inclusive, of this Annex is intended to be the printed form of ISDA
Credit
Support Annex (Bilateral Form - ISDA Agreements Subject to New York
Law
Only version) as published and copyrighted in 1994 by the International
Swaps and Derivatives Association, Inc.
|
| (v) |
Events
of Default.
Paragraph 7 will not apply to cause any Event of Default to exist
with
respect to Party B except that Paragraph 7(i) will apply to Party
B solely
in respect of Party B’s obligations under Paragraph 3(b) of the Credit
Support Annex. Notwithstanding anything to the contrary in Paragraph
7,
any failure by Party A to comply with or perform any obligation to
be
complied with or performed by Party A under the Credit Support Annex
shall
only be an Event of Default if (A) a
S&P Required Ratings Downgrade Event has occurred and been continuing
for 30 or more Local Business Days, and (B) such failure is not remedied
on or before the third Local Business Day after notice of such failure
is
given to Party A.
|
| (vi) |
Expenses.
Notwithstanding anything to the contrary in Paragraph 10, the Pledgor
will
be responsible for, and will reimburse the Secured Party for, all
transfer
and other taxes and other costs involved in any Transfer of Eligible
Collateral.
|
| (vii) |
Withholding.
Paragraph 6(d)(ii) is hereby amended by inserting immediately after
“the
Interest Amount” in the fourth line thereof the words “less any applicable
withholding taxes.”
|
(ix) Additional
Definitions.
As used
in this Annex:
“Collateral
Event” means
that no Relevant Entity has credit ratings at least equal to the Approved
Ratings Threshold.
“Exposure”
has the meaning specified in Paragraph 12, except that after the word
“Agreement” the words “(assuming, for this purpose only, that Part 1(f) of the
Schedule is deleted)” shall be inserted.
“Local
Business Day”
means:
any day on which (A) commercial banks are open for business (including dealings
in foreign exchange and foreign currency deposits) in New York and the location
of Party A, Party B and any Custodian, and (B) in relation to a Transfer
of
Eligible Collateral, any day on which the clearance system agreed between
the
parties for the delivery of Eligible Collateral is open for acceptance and
execution of settlement instructions (or in the case of a Transfer of Cash
or
other Eligible Collateral for which delivery is contemplated by other means
a
day on which commercial banks are open for business (including dealings in
foreign exchange and foreign deposits) in New York and the location of Party
A,
Party B and any Custodian.
“Xxxxx’x
First Trigger Event” means
that no Relevant Entity has credit ratings from Xxxxx’x at least equal to the
Xxxxx’x First Trigger Ratings Threshold.
“Xxxxx’x
First Trigger Credit Support Amount” means,
for any Valuation Date, the excess, if any, of
|
(I)
|
(A)
|
for
any Valuation Date on which (I) a Xxxxx’x First Trigger Event has occurred
and has been continuing (x) for at least 30 Local Business Days
or (y)
since this Annex was executed and (II) it is not the case that
a Xxxxx’x
Second Trigger Event has occurred and been continuing for at least
30
Local Business Days, an amount equal to the greater of (a) zero
and (b)
the sum of (i) the Secured Party’s Exposure for such Valuation Date and
(ii) the sum, for each Transaction to which this Annex relates,
of the
product of (1) the applicable Xxxxx’x First Trigger Factor set forth in
Table 1 and (2) the Notional Amount for such Transaction for the
Calculation Period which includes such Valuation Date; or
|
|
(B)
|
for
any other Valuation Date, zero,
over
|
(II)
the
Threshold for Party A such Valuation Date.
“Xxxxx’x
First Trigger Ratings Threshold” means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, (i) if such entity has a short-term unsecured and
unsubordinated debt rating from Xxxxx’x, a long-term unsecured and
unsubordinated debt rating or
counterparty rating from
Xxxxx’x of “A2” and a short-term unsecured and unsubordinated debt rating from
Xxxxx’x of “Prime-1”, or (ii) if such entity does not have a short-term
unsecured and unsubordinated debt rating or counterparty rating from Xxxxx’x, a
long-term unsecured and unsubordinated debt rating or counterparty rating
from
Xxxxx’x of “A1”.
“Xxxxx’x
First Trigger Value”
means,
on any date and with respect to any Eligible Collateral other than Cash,
the bid
price obtained by the Valuation Agent multiplied by the Xxxxx’x First Trigger
Valuation Percentage for such Eligible Collateral set forth in Paragraph
13(b)(ii).
“Xxxxx’x
Second Trigger Event” means
that no Relevant Entity has credit ratings from Xxxxx’x at least equal to the
Xxxxx’x Second Trigger Ratings Threshold.
“Xxxxx’x
Second Trigger Credit Support Amount”
means,
for any Valuation Date, the excess, if any, of
|
(I)
|
(A)
|
for
any Valuation Date on which it is the case that a Xxxxx’x Second Trigger
Event has occurred and been continuing for at least 30 Local Business
Days, an amount equal to the greatest of (a) zero, (b) the aggregate
amount of the next payment due to be paid by Party A under each
Transaction to which this Annex relates, and (c) the sum of (x)
the
Secured Party’s Exposure for such Valuation Date and (y) the sum, for each
Transaction to which this Annex relates, of
|
(1) if
such
Transaction is not a Transaction-Specific Hedge, the product of (i) the
applicable Xxxxx’x Second Trigger Factor set forth in Table 2 and (ii) the
Notional Amount for such Transaction for the Calculation Period which includes
such Valuation Date;
or
(2)
if
such Transaction is a Transaction-Specific Hedge, the
product of (i) the applicable Xxxxx’x Second Trigger Factor set forth in Table 3
and (ii) the Notional Amount for such Transaction for the Calculation Period
which includes such Valuation Date; or
|
(B)
|
for
any other Valuation Date, zero,
over
|
(II)
the
Threshold for Party A for such Valuation Date.
“Xxxxx’x
Second Trigger Ratings Threshold” means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, (i) if such entity has a short-term unsecured and
unsubordinated debt rating from Xxxxx’x, a long-term unsecured and
unsubordinated debt rating or counterparty rating from Xxxxx’x of “A3” and a
short-term unsecured and unsubordinated debt rating from Xxxxx’x of “Prime-2”,
or (ii) if such entity does not have a short-term unsecured and unsubordinated
debt rating from Xxxxx’x, a long-term unsecured and unsubordinated debt rating
or counterparty rating from Xxxxx’x of “A3”.
“Xxxxx’x
Second Trigger Value”
means,
on any date and with respect to any Eligible Collateral other than Cash,
the bid
price obtained by the Valuation Agent multiplied by the Xxxxx’x Second Trigger
Valuation Percentage for such Eligible Collateral set forth in Paragraph
13(b)(ii).
“Pricing
Sources”
means
the sources of financial information commonly known as Bloomberg, Bridge
Information Services, Data Resources Inc., Interactive Data Services,
International Securities Market Association, Xxxxxxx Xxxxx Securities Pricing
Service, Xxxxxx Data Corporation, Reuters, Wood Gundy, Trepp Pricing, XX
Xxxxx,
S&P and Telerate.
“S&P
Approved Ratings Threshold”
means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, a short-term unsecured and unsubordinated debt rating
from
S&P of “A-1”, or, if such entity does not have a short-term unsecured and
unsubordinated debt rating from S&P, a long-term unsecured and
unsubordinated debt rating from S&P of “A+”.
“S&P/DBRS
Credit Support Amount”
means,
for any Valuation Date, the excess, if any, of
|
(I)
|
(A)
|
for
any Valuation Date on which (i) an S&P/DBRS Rating Threshold Event has
occurred and been continuing for at least 30 days, or (ii) a S&P/DBRS
Required Ratings Downgrade Event has occurred and is continuing,
an amount
equal to the sum of (1) 100.0% of the Secured Party’s Exposure for such
Valuation Date and (2) the sum, for each Transaction to which this
Annex
relates, of the product of (i) the Volatility Buffer for such Transaction
and (ii) the Notional Amount of such Transaction for the Calculation
Period of such Transaction which includes such Valuation Date,
or
|
|
(B)
|
for
any other Valuation Date, zero,
over
|
(II)
the
Threshold for Party A for such Valuation Date.
“S&P/DBRS
Rating Threshold Event”
means,
on any date, no Relevant Entity has credit ratings from S&P which equal or
exceed the S&P Approved Ratings Threshold and the DBRS Approved Ratings
Threshold.
“S&P/DBRS
Required Ratings Downgrade Event”
means
that no Relevant Entity has credit ratings at least equal to the S&P
Required Ratings Threshold and the DBRS Required Ratings Threshold.
“S&P/DBRS
Value”
means,
on any date and with respect to any Eligible Collateral other than Cash,
the
product of (A) the bid price obtained by the Valuation Agent for such Eligible
Collateral and (B) the S&P Valuation Percentage for such Eligible Collateral
set forth in paragraph 13(b)(ii).
“Transaction
Exposure”
means,
for any Transaction, Exposure determined as if such Transaction were the
only
Transaction between the Secured Party and the Pledgor.
“Transaction-Specific
Hedge” means
any
Transaction that is (i) an interest rate swap in respect of which (x) the
notional amount of the interest rate swap is “balance guaranteed” or (y) the
notional amount of the interest rate swap for any Calculation Period otherwise
is not a specific dollar amount that is fixed at the inception of the
Transaction, (ii) an interest rate cap, (iii) an interest rate floor or (iv)
an
interest rate swaption.
“Valuation
Percentage”
shall
mean, for purposes of determining the S&P/DBRS Value, Xxxxx’x First Trigger
Value, or Xxxxx’x Second Trigger Value with respect to any Eligible Collateral
or Posted Collateral, the applicable S&P/DBRS Valuation Percentage, Xxxxx’x
First Trigger Valuation Percentage, or Xxxxx’x Second Trigger Valuation
Percentage for such Eligible Collateral or Posted Collateral, respectively,
in
each case as set forth in Paragraph 13(b)(ii).
“Value”
shall
mean, in respect of any date, the related S&P/DBRS Value, the related
Xxxxx’x First Trigger Value, and the related Xxxxx’x Second Trigger
Value.
“Volatility
Buffer”
means,
for any Transaction, the related percentage set forth in the following table.
|
The
higher of the S&P credit rating of (i) Party A and (ii) the Credit
Support Provider of Party A, if applicable
|
Remaining
Weighted Average Maturity of such Transaction
up
to 3 years
|
Remaining
Weighted Average Maturity of such Transaction
up
to 5 years
|
Remaining
Weighted Average Maturity of such Transaction
up
to 10 years
|
Remaining
Weighted Average Maturity of such Transaction
up
to 30 years
|
|
“A-2”
or higher
|
2.75%
|
3.25%
|
4.00%
|
4.75%
|
|
“A-3”
|
3.25%
|
4.00%
|
5.00%
|
6.25%
|
|
“BB+”
or
lower
|
3.50%
|
4.50%
|
6.75%
|
7.50%
|
[Remainder
of this page intentionally left blank]
Table
1
Xxxxx’x
First Trigger Factor
|
Remaining
Weighted
Average Life
of
Hedge in Years
|
Daily
Collateral
Posting
|
|
1
or less
|
0.15%
|
|
More
than 1 but not more than 2
|
0.30%
|
|
More
than 2 but not more than 3
|
0.40%
|
|
More
than 3 but not more than 4
|
0.60%
|
|
More
than 4 but not more than 5
|
0.70%
|
|
More
than 5 but not more than 6
|
0.80%
|
|
More
than 6 but not more than 7
|
1.00%
|
|
More
than 7 but not more than 8
|
1.10%
|
|
More
than 8 but not more than 9
|
1.20%
|
|
More
than 9 but not more than 10
|
1.30%
|
|
More
than 10 but not more than 11
|
1.40%
|
|
More
than 11 but not more than 12
|
1.50%
|
|
More
than 12 but not more than 13
|
1.60%
|
|
More
than 13 but not more than 14
|
1.70%
|
|
More
than 14 but not more than 15
|
1.80%
|
|
More
than 15 but not more than 16
|
1.90%
|
|
More
than 16 but not more than 17
|
2.00%
|
|
More
than 17 but not more than 18
|
2.00%
|
|
More
than 18 but not more than 19
|
2.00%
|
|
More
than 19 but not more than 20
|
2.00%
|
|
More
than 20 but not more than 21
|
2.00%
|
|
More
than 21 but not more than 22
|
2.00%
|
|
More
than 22 but not more than 23
|
2.00%
|
|
More
than 23 but not more than 24
|
2.00%
|
|
More
than 24 but not more than 25
|
2.00%
|
|
More
than 25 but not more than 26
|
2.00%
|
|
More
than 26 but not more than 27
|
2.00%
|
|
More
than 27 but not more than 28
|
2.00%
|
|
More
than 28 but not more than 29
|
2.00%
|
|
More
than 29
|
2.00%
|
Table
2
Xxxxx’x
Second Trigger Factor for Interest Rate Swaps with Fixed Notional
Amounts
|
Remaining
Weighted
Average Life
of
Hedge in Years
|
Daily
Collateral
Posting
|
|
1
or less
|
0.50%
|
|
More
than 1 but not more than 2
|
1.00%
|
|
More
than 2 but not more than 3
|
1.50%
|
|
More
than 3 but not more than 4
|
1.90%
|
|
More
than 4 but not more than 5
|
2.40%
|
|
More
than 5 but not more than 6
|
2.80%
|
|
More
than 6 but not more than 7
|
3.20%
|
|
More
than 7 but not more than 8
|
3.60%
|
|
More
than 8 but not more than 9
|
4.00%
|
|
More
than 9 but not more than 10
|
4.40%
|
|
More
than 10 but not more than 11
|
4.70%
|
|
More
than 11 but not more than 12
|
5.00%
|
|
More
than 12 but not more than 13
|
5.40%
|
|
More
than 13 but not more than 14
|
5.70%
|
|
More
than 14 but not more than 15
|
6.00%
|
|
More
than 15 but not more than 16
|
6.30%
|
|
More
than 16 but not more than 17
|
6.60%
|
|
More
than 17 but not more than 18
|
6.90%
|
|
More
than 18 but not more than 19
|
7.20%
|
|
More
than 19 but not more than 20
|
7.50%
|
|
More
than 20 but not more than 21
|
7.80%
|
|
More
than 21 but not more than 22
|
8.00%
|
|
More
than 22 but not more than 23
|
8.00%
|
|
More
than 23 but not more than 24
|
8.00%
|
|
More
than 24 but not more than 25
|
8.00%
|
|
More
than 25 but not more than 26
|
8.00%
|
|
More
than 26 but not more than 27
|
8.00%
|
|
More
than 27 but not more than 28
|
8.00%
|
|
More
than 28 but not more than 29
|
8.00%
|
|
More
than 29
|
8.00%
|
Table
3
Xxxxx’x
Second Trigger Factor for Transaction-Specific Xxxxxx
|
Remaining
Weighted
Average Life
of
Hedge in Years
|
Daily
Collateral
Posting
|
|
1
or less
|
0.65%
|
|
More
than 1 but not more than 2
|
1.30%
|
|
More
than 2 but not more than 3
|
1.90%
|
|
More
than 3 but not more than 4
|
2.50%
|
|
More
than 4 but not more than 5
|
3.10%
|
|
More
than 5 but not more than 6
|
3.60%
|
|
More
than 6 but not more than 7
|
4.20%
|
|
More
than 7 but not more than 8
|
4.70%
|
|
More
than 8 but not more than 9
|
5.20%
|
|
More
than 9 but not more than 10
|
5.70%
|
|
More
than 10 but not more than 11
|
6.10%
|
|
More
than 11 but not more than 12
|
6.50%
|
|
More
than 12 but not more than 13
|
7.00%
|
|
More
than 13 but not more than 14
|
7.40%
|
|
More
than 14 but not more than 15
|
7.80%
|
|
More
than 15 but not more than 16
|
8.20%
|
|
More
than 16 but not more than 17
|
8.60%
|
|
More
than 17 but not more than 18
|
9.00%
|
|
More
than 18 but not more than 19
|
9.40%
|
|
More
than 19 but not more than 20
|
9.70%
|
|
More
than 20 but not more than 21
|
10.00%
|
|
More
than 21 but not more than 22
|
10.00%
|
|
More
than 22 but not more than 23
|
10.00%
|
|
More
than 23 but not more than 24
|
10.00%
|
|
More
than 24 but not more than 25
|
10.00%
|
|
More
than 25 but not more than 26
|
10.00%
|
|
More
than 26 but not more than 27
|
10.00%
|
|
More
than 27 but not more than 28
|
10.00%
|
|
More
than 28 but not more than 29
|
10.00%
|
|
More
than 29
|
10.00%
|
Schedule
1
Eligible
Collateral
|
Eligible
Collateral & Valuation Percentages
Xxxxx’x
and S&P/DBRS
|
||||
|
Valuation
Percentage
|
Valuation
Percentage
|
|||
|
Xxxxx’x
|
S&P/DBRS
|
|||
|
First
Trigger
|
Second
Trigger
|
Daily
|
||
|
(A)
|
Cash
|
100
|
100
|
100
|
|
(B)
|
Fixed-rate
negotiable debt obligations issued by the U.S. Treasury Department
having
a remaining maturity on such date of not more than one
year
|
100
|
100
|
98.5
|
|
(C)
|
Fixed-rate
negotiable debt obligations issued by the U.S. Treasury Department
having
a remaining maturity on such date of more than one year but not
more than
ten years
|
100
|
94
|
89.9
|
|
(D)
|
Fixed-rate
negotiable debt obligations issued by the U.S. Treasury Department
having
a remaining maturity on such date of more than ten years
|
100
|
87
|
83.9
|
|
(E)
|
Agency
Securities:
negotiable debt obligations of the Federal National Mortgage Association
(FNMA) and Xxxxxxx Mac (collectively, “Agency
Securities”)
issued after July 18, 1984 and having a remaining maturity of not
more
than 1 year.
|
100
|
99
|
98.5
|
|
(F)
|
Agency
Securities having a remaining maturity of greater than 1 year but
not more
than 2 years.
|
100
|
98
|
97.7
|
|
(G)
|
Agency
Securities having a remaining maturity of greater than 2 years
but not
more than 3 years.
|
100
|
97
|
97.3
|
|
(H)
|
Agency
Securities having a remaining maturity of greater than 3 years
but not
more than 5 years.
|
100
|
96
|
94.5
|
|
(I)
|
Agency
Securities having a remaining maturity of greater than 5 years
but not
more than 7 years.
|
100
|
94
|
93.1
|
|
(J)
|
Agency
Securities having a remaining maturity of greater than 7 years
but not
more than 10 years.
|
100
|
93
|
90.7
|
|
(K)
|
Agency
Securities having a remaining maturity of greater than 10 years
but not
more than 20 years.
|
100
|
88
|
87.7
|
|
(L)
|
Agency
Securities having a remaining maturity of greater than 20 years
but not
more than 30 years.
|
100
|
86
|
84.4
|
IN
WITNESS WHEREOF, the parties have executed this Annex by their duly authorized
representatives as of the date of the Agreement.
|
HSBC
Bank USA, National Association
|
HSBC
Bank USA, National Association, not individually, but solely as
Supplemental Interest Trust Trustee on behalf of the Supplemental
Interest
Trust with respect to the Nomura Home Equity Loan, Inc., Home Equity
Loan
Trust, Series 2007-2
|
|||
|
By:
|
By:
|
|||
|
Name:
|
Name:
|
|||
|
Title:
|
Title:
|
|||
|
Date:
|
Date:
|
|||
EXHIBIT
S
FORM
OF
POWER OF ATTORNEY
RECORDING
REQUESTED BY
AND
WHEN
RECORDED MAIL TO
[Servicer]
[Servicer’s
Address]
Attn:
_________________________________
LIMITED
POWER OF ATTORNEY
KNOW
ALL
MEN BY THESE PRESENTS, that ________________, having its principal place
of
business at ____________________, as Trustee (the “Trustee”) pursuant to that
Pooling and Servicing Agreement among ___________________ (the “Depositor”),
___________________ (the “Sponsor”), Ocwen Loan Servicing, LLC (“Ocwen”), as a
servicer, Equity One, Inc. (“Equity One”), as a servicer, Select Portfolio
Servicing, LLC (“SPS), as a servicer, Xxxxx Fargo Bank, N.A. (“Xxxxx Fargo”), as
Master Servicer and Securities Administrator, and the Trustee, dated as of
January 1, 2007 (the “Pooling and Servicing Agreement”), hereby constitutes and
appoints [Ocwen][Equity
One][SPS]
(the
“Servicer”), by and through the Servicer’s officers, the Trustee’s true and
lawful Attorney-in-Fact, in the Trustee’s name, place and stead and for the
Trustee’s benefit, in connection with all mortgage loans serviced by the
Servicer pursuant to the Pooling and Servicing Agreement for the purpose
of
performing all acts and executing all documents in the name of the Trustee
as
may be customarily and reasonably necessary and appropriate to effectuate
the
following enumerated transactions in respect of any of the mortgages or deeds
of
trust (the “Mortgages” and the “Deeds of Trust”, respectively) and promissory
notes secured thereby (the “Mortgage Notes”) for which the undersigned is acting
as Trustee for various certificateholders (whether the undersigned is named
therein as mortgagee or beneficiary or has become mortgagee by virtue of
endorsement of the Mortgage Note secured by any such Mortgage or Deed of
Trust)
and for which the Servicer is acting as servicer, all subject to the terms
of
the Pooling and Servicing Agreement and Servicing Agreement.
This
appointment shall apply to the following enumerated transactions
only:
| 1. |
The
modification or re-recording of a Mortgage or Deed of Trust, where
said
modification or re-recordings is for the purpose of correcting
the
Mortgage or Deed of Trust to conform same to the original intent
of the
parties thereto or to correct title errors discovered after such
title
insurance was issued and said modification or re-recording, in
either
instance, does not adversely affect the lien of the Mortgage or
Deed of
Trust as insured.
|
| 2. |
The
subordination of the lien of a Mortgage or Deed of Trust to an
easement in
favor of a public utility company of a government agency or unit
with
powers of eminent domain; this section shall include, without limitation,
the execution of partial satisfactions/releases, partial reconveyances
or
the execution or requests to trustees to accomplish
same.
|
| 3. |
The
conveyance of the properties to the mortgage insurer, or the closing
of
the title to the property to be acquired as real estate owned,
or
conveyance of title to real estate
owned.
|
4.
The
completion of loan assumption agreements.
| 5. |
The
full satisfaction/release of a Mortgage or Deed of Trust or full
conveyance upon payment and discharge of all sums secured thereby,
including, without limitation, cancellation of the related Mortgage
Note.
|
| 6. |
The
assignment of any Mortgage or Deed of Trust and the related Mortgage
Note,
in connection with the repurchase of the mortgage loan secured
and
evidenced thereby.
|
| 7. |
The
full assignment of a Mortgage or Deed of Trust upon payment and
discharge
of all sums secured thereby in conjunction with the refinancing
thereof,
including, without limitation, the assignment of the related Mortgage
Note.
|
| 8. |
With
respect to a Mortgage or Deed of Trust, the foreclosure, the taking
of a
deed in lieu of foreclosure, or the completion of judicial or non-judicial
foreclosure or termination, cancellation or rescission of any such
foreclosure, including, without limitation, any and all of the
following
acts:
|
| a. |
the
substitution of trustee(s) serving under a Deed of Trust, in accordance
with state law and the Deed of
Trust;
|
| b. |
the
preparation and issuance of statements of breach or
non-performance;
|
| c. |
the
preparation and filing of notices of default and/or notices of
sale;
|
| d. |
the
cancellation/rescission of notices of default and/or notices of
sale;
|
| e. |
the
taking of a deed in lieu of foreclosure;
and
|
| f. |
the
preparation and execution of such other documents and performance
of such
other actions as may be necessary under the terms of the Mortgage,
Deed of
Trust or state law to expeditiously complete said transactions
in
paragraphs 8.a. through 8.e.,
above.
|
The
undersigned gives said Attorney-in-Fact full power and authority to execute
such
instruments and to do and perform all and every act and thing necessary and
proper to carry into effect the power or powers granted by or under this
Limited
Power of Attorney as fully as the undersigned might or could do, and hereby
does
ratify and confirm to all that said Attorney-in-Fact shall lawfully do or
cause
to be done by authority hereof.
Third
parties without actual notice may rely upon the exercise of the power granted
under this Limited Power of Attorney; and may be satisfied that this Limited
Power of Attorney shall continue in full force and effect and has not been
revoked unless an instrument of revocation has been made in writing by the
undersigned.
IN
WITNESS WHEREOF, ________________ as Trustee pursuant to that Pooling and
Servicing Agreement among the Depositor, the Sponsor, the Servicer, Xxxxx
Fargo
and the Trustee, dated as of ___________ 1, 200__ (_____________ Asset-Backed
Certificates, Series 200__-___), has caused its corporate seal to be hereto
affixed and these presents to be signed and acknowledged in its name and
behalf
by ____________ its duly elected and authorized Vice President this _________
day of _________, 200__.
|
as
Trustee for _____ Asset
Backed
Certificates, Series 200__-___
|
||||||||
|
By:
|
||||||||
|
STATE
OF _____________
|
|
COUNTY
OF ___________
|
On
_______________, 200__, before me, the undersigned, a Notary Public in and
for
said state, personally appeared ____________, Vice President of
____________________ as Trustee for ___________ Asset-Backed Certificates,
Series 200__-___, personally known to me to be the person whose name is
subscribed to the within instrument and acknowledged to me that he/she executed
that same in his/her authorized capacity, and that by his/her signature on
the
instrument the entity upon behalf of which the person acted and executed
the
instrument.
WITNESS
my hand and official seal.
(SEAL)
|
Notary
Public
|
|
|
My
Commission Expires
_________________
|
EXHIBIT
T
ASSIGNMENTAGREEMENT
ASSIGNMENT,
ASSUMPTION AND RECOGNITION AGREEMENT
This
Assignment, Assumption and Recognition Agreement (this “AAR Agreement”) is made
and entered into as of January 1, 2007 (the “Closing Date”), among Nomura Credit
& Capital, Inc., having an address at 2
World
Financial Center, Building B, 21st
Floor,
New York, New York 10281
(the
“Assignor”), Nomura Home Equity Loan, Inc., having an address at 2 World
Financial Center, Building B, 21st
Floor,
New York, New York 10281 (the “Assignee”) and Xxxxx Fargo Bank, N.A., having an
address at 0 Xxxx Xxxxxx, Xxx Xxxxxx, Xxxx 00000-0000 (the “Servicer” or the
“Company”).
In
consideration of the mutual promises contained herein the parties hereto
agree
that the residential mortgage loans identified on the schedule annexed hereto
as
Attachment
1
(the
“Assigned Loans”), which are now serviced by the Servicer on behalf of the
Assignor and its successors and assigns pursuant to the Seller’s Warranties and
Servicing Agreement (WFHM
2006-M03),
dated
as of March 1, 2006, between the Assignor and the Servicer (the “Servicing
Agreement”) and attached hereto as Attachment
2,
shall
be sold by the Assignor to the Assignee pursuant to the Mortgage Loan Purchase
Agreement, dated as of January 31, 2007 (the “MLPA”), between the Assignor and
the Assignee and subject to the terms of this AAR Agreement. The Assignee
intends to transfer all right, title and interest in and to the Assigned
Loans
and the Servicing Agreement to HSBC Bank USA, National Association, as trustee
(the “Trustee”) for
the
holders of Nomura Home Equity Loan, Inc., Home Equity Loan Trust, Series
2007-2
Asset-Backed Certificates, Series 2007-2 (the “Certificateholders”) pursuant to
the Pooling and Servicing Agreement, dated as of January 1, 2007 (the “Pooling
and Servicing Agreement”) among the Assignor, as the sponsor, the Assignee, as
depositor, Equity
One, Inc. as a servicer, Ocwen Loan Servicing, LLC as a servicer, Select
Portfolio Servicing, Inc. as a servicer, the
Trustee and Xxxxx Fargo Bank, N.A., as master servicer (the “Master Servicer”)
and securities administrator (the “Securities Administrator”).
Capitalized terms used herein but not defined shall have the meanings ascribed
to them in the Servicing Agreement.
Assignment
and Assumption
1. Assignor
hereby grants, transfers and assigns to Assignee all of the right, title
and
interest of Assignor in, to and under the Servicing Agreement as it relates
to
the Assigned Loans. Assignor specifically reserves and does not assign to
Assignee any right, title and interest in, to or under the Servicing Agreement,
as it relates to any mortgage loans other than the Assigned Loans.
Notwithstanding anything to the contrary contained herein, the Assignor
specifically reserves and does not assign to the Assignee the representations
and warranties contained in Sections 3.01 and 3.02 of the Servicing Agreement
or
the right to enforce the representations and warranties against the Company,
including, without limitation, the rights set forth in Section 3.03 of the
Servicing Agreement.
Representations,
Warranties and Covenants
2. Assignor
warrants and represents to Assignee and Servicer as of the Closing
Date:
(a) Attached
hereto as Attachment
2
is a
true and accurate copy of the Servicing Agreement, which Servicing Agreement
is
in full force and effect as of the date hereof and the provisions of which,
except as set forth herein, have not been waived, amended or modified in
any
respect, nor has any notice of termination been given thereunder;
(b) Assignor
is the lawful owner of the Assigned Loans with full right to transfer the
Assigned Loans and any and all of its interests and rights under the Servicing
Agreement as they relate to the Assigned Loans to the extent set forth herein,
free and clear of any and all claims and encumbrances; and upon the transfer
of
the Assigned Loans to Assignee under the MLPA, Assignee shall have good title
to
each and every Assigned Loan, as well as any and all of Assignor’s interests and
rights under the Servicing Agreement as they relate to the Assigned Loans,
free
and clear of any and all liens, claims and encumbrances;
(c) Assignor
is duly organized, validly existing and in good standing under the laws of
the
jurisdiction of its incorporation, and has all requisite power and authority
to
sell, transfer and assign the Assigned Loans;
(d) Assignor
has full corporate power and authority to execute, deliver and perform its
obligations under this AAR Agreement, and to consummate the transactions
set
forth herein. The consummation of the transactions contemplated by this AAR
Agreement is in the ordinary course of Assignor’s business and will not conflict
with, or result in a breach of, any of the terms, conditions or provisions
of
Assignor’s certificate of incorporation or by-laws or any legal restriction, or
any material agreement or instrument to which Assignor is now a party or
by
which it is bound, or result in the violation of any law, rule, regulation,
order, judgment or decree to which Assignor or its property is subject. The
execution, delivery and performance by Assignor of this AAR Agreement and
the
consummation by it of the transactions contemplated hereby, have been duly
authorized by all necessary corporate action on the part of Assignor. This
AAR
Agreement has been duly executed and delivered by Assignor and, upon the
due
authorization, execution and delivery by Assignee and Servicer, will constitute
the valid and legally binding obligation of Assignor enforceable against
Assignor in accordance with its terms except as enforceability may be limited
by
bankruptcy, reorganization, insolvency, moratorium or other similar laws
now or
hereafter in effect relating to creditors’ rights generally, and by general
principles of equity regardless of whether enforceability is considered in
a
proceeding in equity or at law; and
(e) No
consent, approval, order or authorization of, or declaration, filing or
registration with, any governmental entity is required to be obtained or
made by
Assignor in connection with the execution, delivery or performance by Assignor
of this AAR Agreement, or the consummation by it of the transactions
contemplated hereby.
3. Assignee
warrants and represents to, and covenants with, Assignor and Servicer as
of the
Closing Date:
(a) Assignee
is duly organized, validly existing and in good standing under the laws of
the
jurisdiction of its incorporation and has all requisite power and authority
to
acquire, own and purchase the Assigned Loans;
(b) Assignee
has full corporate power and authority to execute, deliver and perform its
obligations under this AAR Agreement, and to consummate the transactions
set
forth herein. The consummation of the transactions contemplated by this AAR
Agreement is in the ordinary course of Assignee’s business and will not conflict
with, or result in a breach of, any of the terms, conditions or provisions
of
Assignee’s certificate of incorporation or by-laws or any legal restriction, or
any material agreement or instrument to which Assignee is now a party or
by
which it is bound, or result in the violation of any law, rule, regulation,
order, judgment or decree to which Assignee or its property is subject. The
execution, delivery and performance by Assignee of this AAR Agreement and
the
consummation by it of the transactions contemplated hereby, have been duly
authorized by all necessary corporate action on the part of Assignee. This
AAR
Agreement has been duly executed and delivered by Assignee and, upon the
due
authorization, execution and delivery by Assignor and the Servicer, will
constitute the valid and legally binding obligation of Assignee enforceable
against Assignee in accordance with its terms except as enforceability may
be
limited by bankruptcy, reorganization, insolvency, moratorium or other similar
laws now or hereafter in effect relating to creditors’ rights generally, and by
general principles of equity regardless of whether enforceability is considered
in a proceeding in equity or at law;
(c) No
consent, approval, order or authorization of, or declaration, filing or
registration with, any governmental entity is required to be obtained or
made by
Assignee in connection with the execution, delivery or performance by Assignee
of this AAR Agreement, or the consummation by it of the transactions
contemplated hereby; and
(d) Assignee
agrees to be bound by all of the terms, covenants and conditions of the
Servicing Agreement, as modified by this AAR Agreement, with respect to the
Assigned Loans.
4. The
Servicer warrants and represents to, and covenants with, Assignor and Assignee
as of the Closing Date:
(a) Attached
hereto as Attachment
2
is a
true and accurate copy of the Servicing Agreement, which Servicing Agreement
is
in full force and effect as of the Closing Date and the provisions of which,
except as set forth herein, have not been waived, amended or modified in
any
respect, nor has any notice of termination been given thereunder;
(b) The
Servicer is duly organized, validly existing and in good standing under the
laws
of the United States of America, and has all requisite power and authority
to
service the Assigned Loans and otherwise to perform its obligations under
the
Servicing Agreement, as modified by this AAR Agreement;
(c) The
Servicer has full power and authority to execute, deliver and perform its
obligations under this AAR Agreement, and to consummate the transactions
set
forth herein. The consummation of the transactions contemplated by this AAR
Agreement is in the ordinary course of the Servicer’s business and will not
conflict with, or result in a breach of, any of the terms, conditions or
provisions of the Servicer’s charter or by-laws or any legal restriction, or any
material agreement or instrument to which the Servicer is now a party or
by
which it is bound, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Servicer or its property is subject.
The
execution, delivery and performance by the Servicer of this AAR Agreement
and
the consummation by it of the transactions contemplated hereby, have been
duly
authorized by all necessary action on the part of the Servicer. This AAR
Agreement has been duly executed and delivered by the Servicer, and, upon
the
due, authorization, execution and delivery by Assignor and Assignee, will
constitute the valid and legally binding obligation of the Servicer, enforceable
against the Servicer in accordance with its terms except as enforceability
may
be limited by insolvency, liquidation, conservatorship or other similar laws
administered by the Federal Deposit Insurance Corporation affecting the
enforcement of contract obligations of insured banks, and by general principals
of equity regardless of whether enforceability is considered in a proceeding
in
equity or at law;
(d) No
consent, approval, order or authorization of, or declaration, filing or
registration with, any governmental entity is required to be obtained or
made by
the Servicer in connection with the execution, delivery or performance by
the
Servicer of this AAR Agreement, or the consummation by it of the transactions
contemplated hereby; and
(e) The
Servicer shall service the Assigned Loans in accordance with the terms and
provisions of the Servicing Agreement, as modified by this AAR Agreement.
The
Servicer shall establish a Custodial Account and an Escrow Account under
the
Servicing Agreement with respect to the Assigned Loans separate from the
Custodial Account and Escrow Account previously established under the Servicing
Agreement in favor of Assignor, and shall remit collections received on the
Assigned Loans to the appropriate account as required by the Servicing
Agreement. The Custodial Account and the Escrow Account each shall be entitled
“Xxxxx Fargo Bank, N.A., as Servicer for HSBC Bank USA, National Association
as
Trustee, in trust for the registered holders of Nomura Home
Equity Loan, Inc., Home Equity Loan Trust, Series 2007-2, Asset-Backed
Certificates, Series 2007-2”
and
shall be established and maintained with a Qualified Depository. Any funds
held
in the Custodial Account are and shall remain uninvested.
Recognition
of Assignee.
5. From
and
after the date hereof, Servicer shall recognize Assignee as owner of the
Assigned Loans, and acknowledges that the Assigned Loans will be part of
a
REMIC, and will service the Assigned Loans in accordance with the Servicing
Agreement, as modified by this AAR Agreement, but in no event in a manner
that
would (i) cause any REMIC to fail to qualify as a REMIC or (ii) result in
the
imposition of a tax upon any REMIC (including but not limited to the tax
on
prohibited transactions as defined in Section 860F(a)(2) of the Internal
Revenue
Code of 1986 (the “Code”) and the tax on contributions to a REMIC set forth in
Section 860G(d) of the Code). It is the intention of Assignor, Servicer and
Assignee that this AAR Agreement shall be binding upon and for the benefit
of
the respective successors and assigns of the parties hereto. Neither Servicer
nor Assignor shall amend or agree to amend, modify, waive, or otherwise alter
any of the terms or provisions of the Servicing Agreement which amendment,
modification, waiver or other alteration would in any way affect the Assigned
Loans without the prior written consent of the Master Servicer and Trustee.
6. The
Servicer hereby acknowledges that the Trustee, acting pursuant to the terms
of
the Pooling and Servicing Agreement, has the right to enforce all obligations
of
the Servicer, as they relate to the Assigned Loans, under the Servicing
Agreement. Such right will include, without limitation, the right to
indemnification, the right to terminate the Servicer under the Servicing
Agreement upon the occurrence of an Event of Default thereunder and the right
to
exercise certain rights of consent and approval relating to actions taken
by the
Servicer under the Servicing Agreement. In addition, any notice required
to be
given by the “Purchaser” pursuant to Section 10.01 of the Servicing Agreement
shall be given by the Master Servicer or the Trustee. The Servicer further
acknowledges that pursuant to the terms of the Pooling and Servicing Agreement,
the Master Servicer is required to monitor the performance of the Servicer
under
the Servicing Agreement, except with respect to Section 4.23 of the Servicing
Agreement. The Master Servicer shall have the right to receive all remittances
required to be made by the Servicer under the Servicing Agreement, the right
to
receive all monthly reports and other data required to be delivered by the
Servicer under the Servicing Agreement, the right to examine the books and
records of the Servicer under the Servicing Agreement and the right to
indemnification under the Servicing Agreement. In addition, if the Servicer
shall fail to remit any payment pursuant to the Servicing Agreement, the
Master
Servicer shall notify the Trustee and the Servicer of such failure as set
forth
in Section 10.01 of the Servicing Agreement. The Servicer hereby agrees to
make
all remittances required under the Servicing Agreement to the Master Servicer
for the benefit of the Certificateholders in accordance with the following
wire
instructions:
Xxxxx
Fargo Bank, N.A.
ABA:
000-000-000
Acct
#:0000000000
Acct
Name: [SAS Clearing]
For
Further Credit to: NHEL 2007-2 Account # 00000000
7. Pursuant
to Section 9.01(a) of the Servicing Agreement, the Servicer hereby makes
the
representations and warranties set forth in Section 3.01 of the Servicing
Agreement as of the Closing Date.
8. In
the
event that the Assignor substitutes any Deleted Mortgage Loans with any
Qualified Substitute Mortgage Loans in the manner set forth in the Pooling
and
Servicing Agreement, the Servicer shall determine the amount (the “Substitution
Shortfall Amount”), if any, by which the aggregate purchase price of all such
Deleted Mortgage Loans exceeds the aggregate of, as to each such Qualified
Substitute Mortgage Loan, (x) the scheduled principal balance thereof as
of the
date of substitution, together with one month’s interest on such scheduled
principal balance at the applicable Mortgage Interest Rate (minus the
Administration Fee Rate (as defined below)), plus (y) all outstanding Monthly
Advances and Servicing Advances (including nonrecoverable Monthly Advances
and
nonrecoverable Servicing Advances) related thereto; provided, however, if
the
Servicer repurchases the Deleted Mortgage Loan, the amounts set forth in
clause
(y) shall not be included in the calculation of the Substitution Shortfall
Amount. On the date of such substitution, the Assignor will deliver or cause
to
be delivered to the Servicer for deposit in the Custodial Account an amount
equal to the Substitution Shortfall Amount, if any, and the Servicer shall
certify in writing or electronic mail to the Trustee that it has received
such
Substitution Shortfall Amount from the Assignor. The Servicer shall remit
such
Substitution Shortfall Amount to the Securities Administrator on the next
succeeding Remittance Date. As used in this Section, the “Administration Fee
Rate” means the sum of the rates used to calculate the fees payable to the
Servicer, the Master Servicer and the credit risk manager under the Pooling
and
Servicing Agreement.
Modification
of the Servicing Agreement
9. The
Servicer and Assignor hereby amend the Servicing Agreement with respect to
the
Assigned Loans as follows:
(a) The
following definitions are added to Article I of the Servicing Agreement in
proper alphabetical order:
“Distribution
Date”:
The
25th
day of
any month, or if such 25th
day is
not a Business Day, the Business Day immediately following such 25th
day,
commencing in February 2007.
“Securities
Administrator”:
Xxxxx
Fargo Bank, N.A., or any successor thereto.
“Trust”:
Nomura
Home Equity Loan, Inc., Home Equity Loan Trust, Series 2007-2.
“Trustee”:
HSBC
Bank USA, National Association a national banking association, or its successor
in interest, or any successor trustee.
(b) The
definition of Business Day in Article I of the Servicing Agreement is modified
by replacing clause (ii) with the following:
(ii)
a
day on which banking institutions in the State of New York, the State of
Maryland, the State of Iowa, the State of California, the State of Minnesota,
the State of South Carolina and the State in which any Corporate Trust Office
of
the Trustee is located are authorized or obligated by law or executive order
to
be closed.
(c) The
definition of “Commission” in Article I of the Servicing Agreement is modified
by replacing such definition with the following:
“Commission”:
The
United States Securities and Exchange Commission.
(d) The
definition of “Depositor” in Article I of the Servicing Agreement is modified by
replacing such definition with the following:
“Depositor”:
Nomura
Home Equity Loan, Inc.
(e) The
definition of “Master Servicer” in Article I of the Servicing Agreement is
modified by replacing such definition with the following:
“Master
Servicer”:
Xxxxx
Fargo Bank, N.A., or any successor thereto.
(f) The
definition of “Officer’s
Certificate”
in
Article I of this Agreement is modified by adding “(i)” at the beginning thereof
and the following after the word “Agreement”:
,
or (ii)
if provided for in this Agreement, signed by an Authorized Servicer
Representative, as the case may be, and delivered to the Depositor, the Sponsor,
the Master Servicer, the Securities Administrator and/or the Trustee, as
the
case may be, as required by this Agreement.
(g) The
definition of “Opinion of Counsel” in Article I of the Servicing Agreement is
modified by replacing such definition with the following:
“Opinion
of Counsel”:
A
written opinion of counsel, who may, without limitation, be salaried counsel
for
the Depositor, the Company, the Securities Administrator or the Master Servicer,
acceptable to the Trustee, except that any opinion of counsel relating to
(a)
the qualification of any REMIC as a REMIC or (b) compliance with the REMIC
Provisions must be an opinion of independent counsel; provided, however,
any
Opinion of Counsel provided by the Company pursuant to clause (b) above may
be
provided by internal counsel; provided that the delivery of such Opinion
of
Counsel shall not release the Company from any of its obligations hereunder
and
the Company shall be responsible for such contemplated actions or inaction,
as
the case may be, to the extent it conflicts with the terms of this
Agreement.
(h) The
definition of “Rating Agency” in Article I of the Servicing Agreement is
modified by replacing such definition with the following:
“Rating
Agencies”:
Xxxxx’x Investors Services, Inc., Standard & Poor’s Ratings Services and
Dominion Bond Rating Service or their successors. If such agencies or their
successors are no longer in existence, “Rating Agencies” shall be such
nationally recognized statistical rating agencies, or other comparable Persons,
designated by the Depositor, notice of which designation shall be given to
the
Trustee.
(i) The
definition of “Servicing Officer” in Article I of the Servicing Agreement is
deleted in its entirety thereof and replaced with the following:
“Servicing
Officer”:
Any
officer of the Servicer involved in, or responsible for, the administration
and
servicing of the Mortgage Loans whose name and facsimile signature appear
on a
list of servicing officers furnished to the Depositor, Trustee and the Master
Servicer by the Servicer on the closing date of any securitization transaction,
as such list may from time to time be amended.
(j) The
definition of “Qualified Depository” in Article I of the Servicing Agreement is
hereby amended by deleting the words “Group or” following the words “Standard
& Poor’s Ratings” and replacing it with “Services and”.
(k) The
following language is added to the end of the definition of “REMIC Provisions”
in Article I of the Servicing Agreement:
“as
well
as provisions of applicable state laws”
(l) The
definition of “Servicer” in Article I of the Servicing Agreement is modified by
replacing such definition with the following:
“Servicer”:
As
defined in Section 9.01(d)(iii).
(m) The
definition of “Servicing Advances” in Article I of the Servicing Agreement is
hereby amended by adding the following language after the phrase “including
reasonable attorney's fees and disbursements”: “but excluding any fees
associated with the registration of any Mortgage Loan on the MERS System
as
required under Section 4.01”.
(n) The
definition of “Servicing Advances” in Article I of the Servicing Agreement is
further amended by adding the following language at the end thereof: “and (f)
payment of taxes.”
(o) The
first
sentence of the second paragraph of Section 4.01 of the Servicing Agreement
is
modified by inserting the phrase “, other than Servicing Advances,” immediately
after the words “any future advances”.
(p) The
second sentence of the first paragraph of Section 4.02 of the Servicing
Agreement is modified by (i) deleting
the phrase “,the Company shall first notify the Purchaser in writing of the
Company's intention to do so” and (ii) deleting
the phrase “, provided that the Company shall not commence foreclosure
proceedings if the Purchaser objects to such action within three (3) Business
Days of receiving such notice”.
(q) Section
4.05 of the Servicing Agreement is modified by deleting the word “and” at the
end of clause (viii), deleting the “.” at the end of clause (ix) and adding “;”
and adding the following clauses: “(x) to reimburse itself for expenses incurred
and reimbursable to it pursuant to the fees paid to MERS under Section 4.01;
and
(xi) to reimburse itself for any Monthly Advance or Servicing Advance previously
made by it which the Company has determined to be a nonrecoverable Monthly
Advance or a nonrecoverable Servicing Advance, as evidenced by the delivery
to
the Master Servicer of a certificate signed by two officers of the
Company”.
(r) Section
4.16 of the Servicing Agreement is modified by deleting the “.” from the first
sentence in the second paragraph and adding the following: “in a manner which
does not cause such REO Property to fail to qualify as “foreclosure property”
within the meaning of Section 860G(a)(8) of the Code or result in the receipt
by
any Trust REMIC created hereunder of any “income from non-permitted assets”
within the meaning of Section 860F(a)(2)(B) of the Code, or any “net income from
foreclosure property” which is subject to taxation under the REMIC
Provisions.”
(s) Section
4.16 of the Servicing Agreement is further modified by deleting the first
sentence from the third paragraph and replacing it with the following: “The
Company, shall either sell any REO Property by the close of the third calendar
year following the calendar year in which the Trust acquires ownership of
such
REO Property for purposes of Section 860(a)(8) of the Code or request from
the
Internal Revenue Service, no later than 60 days before the day on which the
three-year grace period would otherwise expire an extension of the three-year
grace period, unless the Company had delivered to the Trustee an Opinion
of
Counsel, addressed to the Trustee and the Depositor, to the effect that the
holding by the Trust of such REO Property subsequent to three years after
its
acquisition will not result in the imposition on any Trust REMIC created
hereunder of taxes on “prohibited transactions” thereof, as defined in Section
860F of the Code, or cause any Trust REMIC hereunder to fail to qualify as
a
REMIC under Federal law at any time that any Certificates issued by the Trust
are outstanding.”
(t) Section
4.17 of the Servicing Agreement is modified by deleting the words “on or before
the Remittance Date” from the first sentence therein.
(u) The
second paragraph of Section 5.01 of the Servicing Agreement is modified by
deleting from the first sentence therein the words “second Business Day
following the” and by deleting the word “second” from the second sentence
therein.
(v) Section
5.02 of the Servicing Agreement is deleted in its entirety and replaced with
the
following:
No
later
than the tenth (10th)
calendar day (or if such tenth (10th)
day is
not a Business Day, the first Business Day immediately preceding such tenth
(10th)
day) of
each month, Company shall furnish to the Master Servicer a computer tape
or data
file containing the data specified in Exhibit I, which data shall reflect
information from the Due Period immediately preceding the Remittance Date
and
such other information with respect to the Mortgage Loans as the Master Servicer
may reasonably require to allocate remittances made pursuant to this Agreement
and provide appropriate statements with respect to such
remittances.
(w) Section
5.03 of the Servicing Agreement is modified by deleting the words “that if
requested by a Rating Agency” from the first sentence of clause (ii)
therein.
(x) The
first
paragraph of Section 6.02 of the Servicing Agreement is modified by deleting
the
words “and may request the release of any Mortgage Loan Documents” and adding
the words “and may request that the Purchaser or its designee release the
related Mortgage Loan Documents” in the last line of such
paragraph.
(y) Section
6.04 of the Servicing Agreement is modified by deleting the words “the
Purchaser, any Master Servicer and any Depositor” and “the Purchaser, such
Master Servicer and such Depositor” and replacing such with “the Master
Servicer”.
(z) Section
6.05 of the Servicing Agreement is deleted in its entirety and replaced with
“Reserved”.
(aa) Section
6.06 of the Servicing Agreement is modified by deleting the words “the
Purchaser, any Master Servicer and any Depositor” and “the Purchaser, such
Master Servicer and such Depositor” and replacing such with “the Master
Servicer,”.
(bb) Section
6.07 of the Servicing Agreement (entitled “Remedies”) is modified by adding the
language “, Master Servicer,” after the phrase “(or such designee)” in clause
(iii) therein.
(cc) Section
6.07 of the Servicing Agreement (entitled “Compliance with REMIC provisions”),
which follows Section 6.08 thereof, is incorrectly numbered and is hereby
renumbered as Section 6.09. In addition, the following paragraph is hereby
added
to new Section 6.09 of the Servicing Agreement:
The
Company shall not permit the creation of any “interests” (within the meaning of
Section 860G of the Code) in any REMIC. The Company shall not enter into
any
arrangement by which a REMIC will receive a fee or other compensation for
services nor permit a REMIC to receive any income from assets other than
“qualified mortgages” as defined in Section 860G(a)(3) of the Code or “permitted
investments” as defined in Section 860G(a)(5) of the Code.
(dd) Section
8.01 of the Servicing Agreement is deleted in its entirety and replaced with
the
following:
The
Company shall indemnify the Purchaser and Master Servicer and hold them harmless
against any and all claims, losses, damages, penalties, fines, forfeitures,
reasonable and necessary legal fees and related costs, judgments, and any
other
costs, fees and expenses that the Purchaser or Master Servicer may sustain
in
any way related to the failure of the Company to perform its duties and service
the Mortgage Loans in strict compliance with the terms of this Agreement.
The
Company immediately shall notify the Purchaser and Master Servicer if a claim
is
made by a third party with respect to this Agreement or the Mortgage Loans,
assume (with prior written consent of the Purchaser or Master Servicer,
respectively) the defense of any such claim and pay all expenses in connection
therewith, including counsel fees, and promptly pay, discharge and satisfy
any
judgment or decree which may be entered against it or the Purchaser or Master
Servicer in respect of such claim. The Company shall follow any written
instructions received from the Purchaser or Master Servicer in connection
with
such claim. The Purchaser or Master Servicer promptly shall reimburse the
Company for all amounts advanced by it pursuant to the preceding sentence
except
when the claim is in any way related to the Company’s indemnification pursuant
to Section 3.03, or the failure of the Company to service and administer
the
Mortgage Loans in strict compliance with the terms of this
Agreement.
(ee) Section
9.01(d) of the Servicing Agreement is modified by deleting phrase “(i), (ii),
(iii) and (vii)” in the first paragraph thereof in its entirety and replacing it
with the phrase “(i), (ii), (iii), (vii) and (viii)”.
(ff) Section
9.01(d)(vi)(A) of the Servicing Agreement is modified by deleting the phrase
“The Company shall be deemed to represent” in the first line thereof in its
entirety and replacing it with the phrase “The Company hereby
represents”.
(gg) Section
9.01(d)(viii) of the Servicing Agreement is modified by adding the following
language at the end thereof: “as may reasonably requested by the Purchaser, any
Master Servicer, or any Depositor.”
(hh) Section
9.01(e)(iv) of the Servicing Agreement is modified by adding the following
language at the end thereof: “or Sections 4.25, 6.04, 6.06, 6.07, 9.01(d) or (f)
or 12.14.”
(ii) Section
9.01 of the Servicing Agreement is modified by deleting the phrase “Section
9.01(d)” in the first sentence of the third paragraph thereof in its entirety
and replacing it with the phrase “Sections 4.25, 6.04, 6.06, 6.07, 9.01(d), (e)
and (f) and 12.14.”
(jj) Section
10.01 of the Servicing Agreement is modified by adding the language “(not
including Sections 6.04 or 6.06 of this Agreement)” after the phrase “set forth
in this Agreement” in clause (ii) therein, and by replacing “thirty (30)” with
“fourteen (14)” in clause (x) therein.
(kk) Section
11.02 of the Servicing Agreement is hereby deleted in its entirety.
(ll) Exhibit
I
of the Servicing Agreement is modified to include the information set forth
on
Attachment
3
hereto
or in such other format mutually agreed upon by the Company and the Master
Servicer.
(mm) Exhibit
I
of the Servicing Agreement is further modified by deleting the phrase “Form of
Remittance Advice” in its entirety and replacing it with the phrase “Form of
Remittance Report”.
(nn) Exhibit
K
of the Servicing Agreement is hereby deleted in its entirety and replaced
with
Attachment
4
hereto.
Miscellaneous
10. All
demands, notices and communications related to the Assigned Loans, the Servicing
Agreement and this AAR Agreement shall be in writing or electronic mail and
shall be deemed to have been duly given if personally delivered at or mailed
by
registered mail, postage prepaid, as follows:
(a) In
the
case of Assignor,
Nomura
Credit & Capital, Inc.
2
World
Financial Xxxxxx
Xxxxxxxx
X, 00xx
Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Legal Assistant
(b) In
the
case of Assignee,
Nomura
Home Equity Loan, Inc.
2
World
Financial Xxxxxx
Xxxxxxxx
X, 00xx
Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
Legal Assistant
(c) In
the
case of Master Servicer,
Xxxxx
Fargo Bank, N.A.
0000
Xxx
Xxxxxxxxx Xxxx
Xxxxxxxx,
Xxxxxxxx 00000
Attention:
Client Manager - NHEL 2007-2
Telecopier:
(000) 000-0000
(d) In
the
case of Servicer,
Xxxxx
Fargo Bank, N.A.
1
Home
Campus
Xxx
Xxxxxx, Xxxx 00000-0000
Attention:
Xxxx X. Xxxxx, MAC X2302-033
With
a
copy to:
Xxxxx
Fargo Bank, N.A.
1
Home
Campus
Xxx
Xxxxxx, Xxxx 00000-0000
Attention:
General Counsel MAC X2401-06T
11. Each
party will pay any commissions, fees and expenses, including attorney’s fees, it
has incurred in connection with the negotiations for, documenting of and
closing
of the transactions contemplated by this AAR Agreement.
12. This
AAR
Agreement shall be construed in accordance with the laws of the State of
New
York, without regard to conflicts of law principles, and the obligations,
rights
and remedies of the parties hereunder shall be determined in accordance with
such laws.
13. No
term
or provision of this AAR Agreement may be waived or modified unless such
waiver
or modification is in writing and signed by the party against whom such waiver
or modification is sought to be enforced.
14. This
AAR
Agreement shall inure to the benefit of the successors and assigns of the
parties hereto. Any entity into which Assignor, Assignee or Company may be
merged or consolidated shall, without the requirement for any further writing,
be deemed Assignor, Assignee or Company, respectively, hereunder.
15. This
AAR
Agreement shall survive the conveyance of the Assigned Loans, the assignment
of
the Servicing Agreement to the extent of the Assigned Loans by Assignor to
Assignee and the termination of the Servicing Agreement.
16. This
AAR
Agreement may be executed simultaneously in any number of counterparts. Each
counterpart shall be deemed to be an original and all such counterparts shall
constitute one and the same instrument.
17. In
the
event that any provision of this AAR Agreement conflicts with any provision
of
the Servicing Agreement with respect to the Assigned Loans, the terms of
this
AAR Agreement shall control.
18. For
purposes of this AAR Agreement, the Trustee and the Master Servicer shall
be
considered third party beneficiaries to this Agreement entitled to all the
rights and benefits accruing to the Trustee and the Master Servicer, as
applicable, herein as if it were a direct party to this AAR
Agreement.
[SIGNATURES
COMMENCE ON FOLLOWING PAGE]
IN
WITNESS WHEREOF, the parties hereto have executed this AAR Agreement as of
the
day and year first above written.
|
NOMURA
CREDIT & CAPITAL, INC.
Assignor
|
|||||||||||||
|
By:
|
/s/
Xxxxxxx X. X. Xxxxxxx
|
||||||||||||
|
Name:
|
Xxxxxxx
X.X. Xxxxxxx
|
||||||||||||
|
Title:
|
Vice
President
|
||||||||||||
|
NOMURA
HOME EQUITY LOAN, INC.
Assignee
|
|||||||||||||
|
By:
|
/s/
Xxxx X. Xxxxxx
|
||||||||||||
|
Name:
|
Xxxx
X. Xxxxxx
|
||||||||||||
|
Title:
|
Managing
Director
|
||||||||||||
|
XXXXX
FARGO BANK, N.A.
Servicer
|
|||||||||||||
|
By:
|
/s/
Xxxxx Xxxxxx
|
||||||||||||
|
Name:
|
Xxxxx
Xxxx Xxxxxx
|
||||||||||||
|
Title:
|
Assistant
Vice President
|
||||||||||||
|
ACKNOWLEDGED
AND AGREED TO:
HSBC
BANK USA, NATIONAL ASSOCIATION
Trustee
for the holders of the Nomura Home Equity Loan, Inc.,
Home
Equity Loan Trust, Series 2007-2
Asset-Backed
Certificates
|
|||||||||||||
|
By:
|
/s/
Xxxxx Xxxxx
|
||||||||||||
|
Name:
|
Xxxxx
Xxxxx
|
||||||||||||
|
Title:
|
Assistant
Vice President
|
||||||||||||
|
ACKNOWLEDGED
AND AGREED TO:
XXXXX
FARGO BANK, N.A.
Master
Servicer
|
|||||||||||||
|
By:
|
/s/
Xxxxx X. Xxxxxx
|
||||||||||||
|
Name:
|
Xxxxx
X. Xxxxxx
|
||||||||||||
|
Title:
|
Vice
President
|
||||||||||||
ATTACHMENT
I
ASSIGNED
LOAN SCHEDULE
ATTACHMENT
2
SELLER’S
WARRANTIES AND SERVICING AGREEMENT
[TO
BE
PROVIDED UPON REQUEST]
ATTACHMENT
3
STANDARD
FILE LAYOUT- SCHEDULED/SCHEDULED
| Exhibit 1: Standard File Layout - Master Servicing | ||||
|
Column
Name
|
Description
|
Decimal
|
Format
Comment
|
Max
Size
|
|
SER_INVESTOR_NBR
|
A
value assigned by the Servicer to define a group of loans.
|
|
Text
up to 10 digits
|
20
|
|
LOAN_NBR
|
A
unique identifier assigned to each loan by the investor.
|
|
Text
up to 10 digits
|
10
|
|
SERVICER_LOAN_NBR
|
A
unique number assigned to a loan by the Servicer. This may be different
than the LOAN_NBR.
|
|
Text
up to 10 digits
|
10
|
|
BORROWER_NAME
|
The
borrower name as received in the file. It is not separated by first
and
last name.
|
|
Maximum
length of 30 (Last, First)
|
30
|
|
SCHED_PAY_AMT
|
Scheduled
monthly principal and scheduled interest payment that a borrower
is
expected to pay, P&I constant.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
NOTE_INT_RATE
|
The
loan interest rate as reported by the Servicer.
|
4
|
Max
length of 6
|
6
|
|
NET_INT_RATE
|
The
loan gross interest rate less the service fee rate as reported
by the
Servicer.
|
4
|
Max
length of 6
|
6
|
|
SERV_FEE_RATE
|
The
servicer's fee rate for a loan as reported by the Servicer.
|
4
|
Max
length of 6
|
6
|
|
SERV_FEE_AMT
|
The
servicer's fee amount for a loan as reported by the Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
NEW_PAY_AMT
|
The
new loan payment amount as reported by the Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
NEW_LOAN_RATE
|
The
new loan rate as reported by the Servicer.
|
4
|
Max
length of 6
|
6
|
|
ARM_INDEX_RATE
|
The
index the Servicer is using to calculate a forecasted
rate.
|
4
|
Max
length of 6
|
6
|
|
ACTL_BEG_PRIN_BAL
|
The
borrower's actual principal balance at the beginning of the processing
cycle.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
ACTL_END_PRIN_BAL
|
The
borrower's actual principal balance at the end of the processing
cycle.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
BORR_NEXT_PAY_DUE_DATE
|
The
date at the end of processing cycle that the borrower's next payment
is
due to the Servicer, as reported by Servicer.
|
|
MM/DD/YYYY
|
10
|
|
SERV_CURT_AMT_1
|
The
first curtailment amount to be applied.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
SERV_CURT_DATE_1
|
The
curtailment date associated with the first curtailment amount.
|
|
MM/DD/YYYY
|
10
|
|
CURT_ADJ_
AMT_1
|
The
curtailment interest on the first curtailment amount, if
applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
SERV_CURT_AMT_2
|
The
second curtailment amount to be applied.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
SERV_CURT_DATE_2
|
The
curtailment date associated with the second curtailment
amount.
|
|
MM/DD/YYYY
|
10
|
|
CURT_ADJ_
AMT_2
|
The
curtailment interest on the second curtailment amount, if
applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
SERV_CURT_AMT_3
|
The
third curtailment amount to be applied.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
SERV_CURT_DATE_3
|
The
curtailment date associated with the third curtailment
amount.
|
|
MM/DD/YYYY
|
10
|
|
CURT_ADJ_AMT_3
|
The
curtailment interest on the third curtailment amount, if
applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
PIF_AMT
|
The
loan "paid in full" amount as reported by the Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
PIF_DATE
|
The
paid in full date as reported by the Servicer.
|
|
MM/DD/YYYY
|
10
|
|
|
|
|
Action
Code Key: 15=Bankruptcy, 00xXxxxxxxxxxx, , 00xXXX, 63=Substitution,
65=Repurchase,70=REO
|
2
|
|
ACTION_CODE
|
The
standard FNMA numeric code used to indicate the default/delinquent
status
of a particular loan.
|
|||
|
INT_ADJ_AMT
|
The
amount of the interest adjustment as reported by the
Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
SOLDIER_SAILOR_ADJ_AMT
|
The
Soldier and Sailor Adjustment amount, if applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
NON_ADV_LOAN_AMT
|
The
Non Recoverable Loan Amount, if applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
LOAN_LOSS_AMT
|
The
amount the Servicer is passing as a loss, if applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
SCHED_BEG_PRIN_BAL
|
The
scheduled outstanding principal amount due at the beginning of
the cycle
date to be passed through to investors.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
SCHED_END_PRIN_BAL
|
The
scheduled principal balance due to investors at the end of a processing
cycle.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
SCHED_PRIN_AMT
|
The
scheduled principal amount as reported by the Servicer for the
current
cycle -- only applicable for Scheduled/Scheduled Loans.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
SCHED_NET_INT
|
The
scheduled gross interest amount less the service fee amount for
the
current cycle as reported by the Servicer -- only applicable for
Scheduled/Scheduled Loans.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
ACTL_PRIN_AMT
|
The
actual principal amount collected by the Servicer for the current
reporting cycle -- only applicable for Actual/Actual
Loans.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
ACTL_NET_INT
|
The
actual gross interest amount less the service fee amount for the
current
reporting cycle as reported by the Servicer -- only applicable
for
Actual/Actual Loans.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
PREPAY_PENALTY_
AMT
|
The
penalty amount received when a borrower prepays on his loan as
reported by
the Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
PREPAY_PENALTY_
WAIVED
|
The
prepayment penalty amount for the loan waived by the
servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
|
|
|
|
|
|
MOD_DATE
|
The
Effective Payment Date of the Modification for the loan.
|
|
MM/DD/YYYY
|
10
|
|
MOD_TYPE
|
The
Modification Type.
|
|
Varchar
- value can be alpha or numeric
|
30
|
|
DELINQ_P&I_ADVANCE_AMT
|
The
current outstanding principal and interest advances made by
Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
STANDARD
FILE LAYOUT- DELINQUENCY REPORTING
| Exhibit : Standard File Layout - Delinquency Reporting | |||||
|
*The
column/header names in bold
are the minimum fields Xxxxx Fargo must receive from every
Servicer
|
|||||
|
Column/Header
Name
|
Description
|
Decimal
|
Format
Comment
|
||
|
SERVICER_LOAN_NBR
|
A
unique number assigned to a loan by the Servicer. This may be different
than the LOAN_NBR
|
|
|||
|
LOAN_NBR
|
A
unique identifier assigned to each loan by the originator.
|
|
|||
|
CLIENT_NBR
|
Servicer
Client Number
|
||||
|
SERV_INVESTOR_NBR
|
Contains
a unique number as assigned by an external servicer to identify
a group of
loans in their system.
|
|
|||
|
BORROWER_FIRST_NAME
|
First
Name of the Borrower.
|
||||
|
BORROWER_LAST_NAME
|
Last
name of the borrower.
|
||||
|
PROP_ADDRESS
|
Street
Name and Number of Property
|
|
|||
|
PROP_STATE
|
The
state where the property located.
|
|
|||
|
PROP_ZIP
|
Zip
code where the property is located.
|
|
|||
|
BORR_NEXT_PAY_DUE_DATE
|
The
date that the borrower's next payment is due to the servicer at
the end of
processing cycle, as reported by Servicer.
|
MM/DD/YYYY
|
|||
|
LOAN_TYPE
|
Loan
Type (i.e. FHA, VA, Conv)
|
|
|||
|
BANKRUPTCY_FILED_DATE
|
The
date a particular bankruptcy claim was filed.
|
MM/DD/YYYY
|
|||
|
BANKRUPTCY_CHAPTER_CODE
|
The
chapter under which the bankruptcy was filed.
|
|
|||
|
BANKRUPTCY_CASE_NBR
|
The
case number assigned by the court to the bankruptcy
filing.
|
|
|||
|
POST_PETITION_DUE_DATE
|
The
payment due date once the bankruptcy has been approved by the
courts
|
MM/DD/YYYY
|
|||
|
BANKRUPTCY_DCHRG_DISM_DATE
|
The
Date The Loan Is Removed From Bankruptcy. Either by Dismissal,
Discharged
and/or a Motion For Relief Was Granted.
|
MM/DD/YYYY
|
|||
|
LOSS_MIT_APPR_DATE
|
The
Date The Loss Mitigation Was Approved By The Servicer
|
MM/DD/YYYY
|
|||
|
LOSS_MIT_TYPE
|
The
Type Of Loss Mitigation Approved For A Loan Such As;
|
||||
|
LOSS_MIT_EST_COMP_DATE
|
The
Date The Loss Mitigation /Plan Is Scheduled To End/Close
|
MM/DD/YYYY
|
|||
|
LOSS_MIT_ACT_COMP_DATE
|
The
Date The Loss Mitigation Is Actually Completed
|
MM/DD/YYYY
|
|||
|
FRCLSR_APPROVED_DATE
|
The
date DA Admin sends a letter to the servicer with instructions
to begin
foreclosure proceedings.
|
MM/DD/YYYY
|
|||
|
ATTORNEY_REFERRAL_DATE
|
Date
File Was Referred To Attorney to Pursue Foreclosure
|
MM/DD/YYYY
|
|||
|
FIRST_LEGAL_DATE
|
Notice
of 1st legal filed by an Attorney in a Foreclosure Action
|
MM/DD/YYYY
|
|||
|
FRCLSR_SALE_EXPECTED_DATE
|
The
date by which a foreclosure sale is expected to occur.
|
MM/DD/YYYY
|
|||
|
FRCLSR_SALE_DATE
|
The
actual date of the foreclosure sale.
|
MM/DD/YYYY
|
|||
|
FRCLSR_SALE_AMT
|
The
amount a property sold for at the foreclosure sale.
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
EVICTION_START_DATE
|
The
date the servicer initiates eviction of the borrower.
|
MM/DD/YYYY
|
|||
|
EVICTION_COMPLETED_DATE
|
The
date the court revokes legal possession of the property from the
borrower.
|
MM/DD/YYYY
|
|||
|
LIST_PRICE
|
The
price at which an REO property is marketed.
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
LIST_DATE
|
The
date an REO property is listed at a particular price.
|
MM/DD/YYYY
|
|||
|
OFFER_AMT
|
The
dollar value of an offer for an REO property.
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
OFFER_DATE_TIME
|
The
date an offer is received by DA Admin or by the Servicer.
|
MM/DD/YYYY
|
|||
|
REO_CLOSING_DATE
|
The
date the REO sale of the property is scheduled to close.
|
MM/DD/YYYY
|
|||
|
REO_ACTUAL_CLOSING_DATE
|
Actual
Date Of REO Sale
|
MM/DD/YYYY
|
|||
|
OCCUPANT_CODE
|
Classification
of how the property is occupied.
|
|
|||
|
PROP_CONDITION_CODE
|
A
code that indicates the condition of the property.
|
|
|||
|
PROP_INSPECTION_DATE
|
The
date a property inspection is performed.
|
MM/DD/YYYY
|
|||
|
APPRAISAL_DATE
|
The
date the appraisal was done.
|
MM/DD/YYYY
|
|||
|
CURR_PROP_VAL
|
The
current "as is" value of the property based on brokers price opinion
or
appraisal.
|
2
|
|
||
|
REPAIRED_PROP_VAL
|
The
amount the property would be worth if repairs are completed pursuant
to a
broker's price opinion or appraisal.
|
2
|
|
||
|
If
applicable:
|
|
|
|||
|
DELINQ_STATUS_CODE
|
FNMA
Code Describing Status of Loan
|
||||
|
DELINQ_REASON_CODE
|
The
circumstances which caused a borrower to stop paying on a loan.
Code
indicates the reason why the loan is in default for this
cycle.
|
||||
|
MI_CLAIM_FILED_DATE
|
Date
Mortgage Insurance Claim Was Filed With Mortgage Insurance
Company.
|
MM/DD/YYYY
|
|||
|
MI_CLAIM_AMT
|
Amount
of Mortgage Insurance Claim Filed
|
No
commas(,) or dollar signs ($)
|
|||
|
MI_CLAIM_PAID_DATE
|
Date
Mortgage Insurance Company Disbursed Claim Payment
|
MM/DD/YYYY
|
|||
|
MI_CLAIM_AMT_PAID
|
Amount
Mortgage Insurance Company Paid On Claim
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
POOL_CLAIM_FILED_DATE
|
Date
Claim Was Filed With Pool Insurance Company
|
MM/DD/YYYY
|
|||
|
POOL_CLAIM_AMT
|
Amount
of Claim Filed With Pool Insurance Company
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
POOL_CLAIM_PAID_DATE
|
Date
Claim Was Settled and The Check Was Issued By The Pool
Insurer
|
MM/DD/YYYY
|
|||
|
POOL_CLAIM_AMT_PAID
|
Amount
Paid On Claim By Pool Insurance Company
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
FHA_PART_A_CLAIM_FILED_DATE
|
Date
FHA Part A Claim Was Filed With HUD
|
MM/DD/YYYY
|
|||
|
FHA_PART_A_CLAIM_AMT
|
Amount
of FHA Part A Claim Filed
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
FHA_PART_A_CLAIM_PAID_DATE
|
Date
HUD Disbursed Part A Claim Payment
|
MM/DD/YYYY
|
|||
|
FHA_PART_A_CLAIM_PAID_AMT
|
Amount
HUD Paid on Part A Claim
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
FHA_PART_B_CLAIM_FILED_DATE
|
Date
FHA Part B Claim Was Filed With HUD
|
MM/DD/YYYY
|
|||
|
FHA_PART_B_CLAIM_AMT
|
Amount
of FHA Part B Claim Filed
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
FHA_PART_B_CLAIM_PAID_DATE
|
Date
HUD Disbursed Part B Claim Payment
|
MM/DD/YYYY
|
|||
|
FHA_PART_B_CLAIM_PAID_AMT
|
Amount
HUD Paid on Part B Claim
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
VA_CLAIM_FILED_DATE
|
Date
VA Claim Was Filed With the Veterans Admin
|
MM/DD/YYYY
|
|||
|
VA_CLAIM_PAID_DATE
|
Date
Veterans Admin. Disbursed VA Claim Payment
|
MM/DD/YYYY
|
|||
|
VA_CLAIM_PAID_AMT
|
Amount
Veterans Admin. Paid on VA Claim
|
2
|
No
commas(,) or dollar signs ($)
|
||
|
MOTION_FOR_RELIEF_DATE
|
The
date the Motion for Relief was filed
|
10
|
MM/DD/YYYY
|
|
FRCLSR_BID_AMT
|
The
foreclosure sale bid amount
|
11
|
No
commas(,) or dollar signs ($)
|
|
FRCLSR_SALE_TYPE
|
The
foreclosure sales results: REO, Third Party, Conveyance to
HUD/VA
|
|
|
|
REO_PROCEEDS
|
The
net proceeds from the sale of the REO property.
|
No
commas(,) or dollar signs ($)
|
|
|
BPO_DATE
|
The
date the BPO was done.
|
|
|
|
CURRENT_BPO_VAL
|
The
current "as is" value of th property based on a brokers price
opinion.
|
|
|
|
REPAIRED_BPO_PROP_VAL
|
The
amount the property would be worth if repairs are completed
pursuant to a
broker's price opinion.
|
|
|
|
CURR_APP_VAL
|
The
current "as is" value of the property based on an
appraisal.
|
11
|
No
commas(,) or dollar signs ($)
|
|
CURRENT_FICO
|
The
current FICO score
|
|
|
|
HAZARD_CLAIM_FILED_DATE
|
The
date the Hazard Claim was filed with the Hazard Insurance
Company.
|
10
|
MM/DD/YYYY
|
|
HAZARD_CLAIM_AMT
|
The
amount of the Hazard Insurance Claim filed.
|
11
|
No
commas(,) or dollar signs ($)
|
|
HAZARD_CLAIM_PAID_DATE
|
The
date the Hazard Insurance Company disbursed the claim
payment.
|
10
|
MM/DD/YYYY
|
|
HAZARD_CLAIM_PAID_AMT
|
The
amount the Hazard Insurance Company paid on the claim.
|
11
|
No
commas(,) or dollar signs ($)
|
|
POOL_CLAIM_FILED_DATE
|
The
date the claim was filed with the Pool Insurance Company.
|
10
|
MM/DD/YYYY
|
|
POOL_CLAIM_AMT
|
The
amount of the claim filed with the Pool Insurance Company.
|
11
|
No
commas(,) or dollar signs ($)
|
|
POOL_CLAIM_PAID_DATE
|
The
date the claim was settled and the check was issued by the
Pool
Insurer.
|
10
|
MM/DD/YYYY
|
|
POOL_CLAIM_AMT_PAID
|
The
amount paid on the claim by the Pool Insurance Company.
|
11
|
No
commas(,) or dollar signs ($)
|
|
FORECLOSURE_FLAG
|
Y
or N
|
Text
|
|
|
BANKRUPTCY_FLAG
|
Y
or N
|
Text
|
|
|
NOD_DATE
|
|
MM/DD/YYYY
|
|
|
MI_CLAIM_DATE
|
Date
Mortgage Insurance is filed
|
MM/DD/YYYY
|
|
|
NOI_DATE
|
|
MM/DD/YYYY
|
|
|
ACTUAL_PAYMENT_PLAN_START_DATE
|
|
MM/DD/YYYY
|
|
|
ACTUAL_PAYMENT_
PLAN_END_DATE
|
|
|
|
|
LIST_DATE
|
|
MM/DD/YYYY
|
|
|
VACANCY/OCCUPANCY_STATUS
|
The
Occupancy status of the defaulted loan's collateral
|
Text
|
|
|
ACTUAL_REO_START_DATE
|
|
MM/DD/YYYY
|
|
|
SALES_PRICE
|
|
Number
|
|
|
UPB_LIQUIDATION
|
Outstanding
Pricipal Balance of the loan upon Liquidation
|
Number
|
|
|
REALIZED_LOSS/GAIN
|
As
defined in the Servicing Agreement
|
Number
|
|
|
LIQUIDATION_PROCEEDS
|
|
Number
|
|
|
PREPAYMENT_CHARGES_COLLECTED
|
The
amount of Prepayment Charges received
|
Number
|
|
|
PREPAYMENT_CALCULATION
|
The
formula behind the prepayment charge
|
Text
|
|
|
PAYOFF_DATE
|
The
date on which the loan was paid off
|
MM/DD/YYYY
|
|
Exhibit
2: Standard
File Codes - Delinquency
Reporting
|
The
Loss
Mit Type
field
should show the approved Loss Mitigation Code as follows:
| · |
ASUM-Approved
Assumption
|
| · |
BAP-Borrower
Assistance Program
|
| · |
CO-
Charge Off
|
| · |
DIL-
Deed-in-Lieu
|
| · |
FFA-
Formal Forbearance Agreement
|
| · |
MOD-
Loan Modification
|
| · |
PRE-
Pre-Sale
|
