Exhibit 99.1
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.,
Depositor
DLJ MORTGAGE CAPITAL, INC.,
Seller
VESTA SERVICING, L.P.,
Servicer and Special Servicer
and
U.S. BANK NATIONAL ASSOCIATION,
Trustee
_______________________________________________________________________________
POOLING AND SERVICING AGREEMENT
Dated as of August 1, 2001
_______________________________________________________________________________
CSFB ABS Trust Series 2001-HE17
CSFB MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2001-HE17
Table of Contents
Page
----
ARTICLE I
DEFINITIONS
SECTION 1.01 Definitions................................................6
SECTION 1.02 Interest Calculations.....................................34
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES
SECTION 2.01 Conveyance of Mortgage Loans.............................35
SECTION 2.02 Acceptance by the Trustee of the Mortgage Loans..........39
SECTION 2.03 Representations and Warranties of
the Seller and Servicer..................................41
SECTION 2.04 Representations and Warranties of the Depositor
as to the Mortgage Loans.................................44
SECTION 2.05 Delivery of Opinion of Counsel
in Connection with Substitutions.........................44
SECTION 2.06 Execution and Delivery of Certificates...................44
SECTION 2.07 REMIC Matters............................................45
SECTION 2.08 Covenants of the Servicer................................45
SECTION 2.09 Conveyance of REMIC Regular Interests and
Acceptance of the Subsidiary REMIC by the Trustee;
Issuance of Certificates.................................45
ARTICLE III
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
SECTION 3.01 Servicer to Service Mortgage Loans.......................47
SECTION 3.02 Subservicing; Enforcement of
the Obligations of Subservicers..........................48
SECTION 3.03 Special Serviced Mortgage Loans..........................49
SECTION 3.04 Notification of Adjustments..............................50
SECTION 3.05 Trustee to Act as Servicer...............................50
SECTION 3.06 Collection of Mortgage Loans; Collection Account;
Certificate Account; Prefunding Account;
Capitalized Interest Account.............................50
SECTION 3.07 Establishment of and Deposits to Escrow Accounts;
Permitted Withdrawals from Escrow Accounts;
Payments of Taxes, Insurance and Other Charges;
Simple Interest Excess Sub-Accounts; Deposits in
Simple Interest Excess Sub-Accounts......................54
SECTION 3.08 Access to Certain Documentation and Information
Regarding the Mortgage Loans; Inspections................56
SECTION 3.09 Permitted Withdrawals from the Collection Accounts
and Certificate Account.................................57
i
SECTION 3.10 Maintenance of Hazard Insurance; Mortgage Impairment
Insurance and Primary Insurance Policy; Claims;
Restoration of Mortgaged Property........................58
SECTION 3.11 Enforcement of Due-on-Sale Clauses;
Assumption Agreements....................................62
SECTION 3.12 Realization Upon Defaulted Mortgage Loans;
Repurchase of Certain Mortgage Loans.....................64
SECTION 3.13 Trustee to Cooperate; Release of Mortgage Files..........67
SECTION 3.14 Documents, Records and Funds in Possession of
the Servicer to be Held for the Trustee..................68
SECTION 3.15 Servicing Fee............................................68
SECTION 3.16 Access to Certain Documentation..........................69
SECTION 3.17 Annual Statement as to Compliance........................69
SECTION 3.18 Annual Independent Public Accountants' Servicing
Statement; Financial Statements..........................69
SECTION 3.19 Maintenance of Fidelity Bond and Errors and
Omissions Insurance......................................70
SECTION 3.20 Prepayment Premiums......................................70
SECTION 3.21 Duties of the Loss Mitigation Advisor....................71
ARTICLE IV
DISTRIBUTIONS AND ADVANCES BY THE SERVICER
SECTION 4.01 Advances by the Servicer.................................72
SECTION 4.02 Priorities of Distribution...............................73
SECTION 4.03 Allocation of Losses.....................................76
SECTION 4.04 Monthly Statements to Certificateholders.................76
SECTION 4.05 Servicer to Cooperate....................................78
SECTION 4.06 Basis Risk Reserve Fund..................................78
SECTION 4.07 Policy Matters...........................................79
ARTICLE V
THE CERTIFICATES
SECTION 5.01 The Certificates.........................................82
SECTION 5.02 Certificate Register; Registration of Transfer
and Exchange of Certificates.............................82
SECTION 5.03 Mutilated, Destroyed, Lost or Stolen Certificates........87
SECTION 5.04 Persons Deemed Owners....................................87
SECTION 5.05 Access to List of Certificateholders' Names
and Addresses............................................87
SECTION 5.06 Maintenance of Office or Agency..........................88
ARTICLE VI
THE DEPOSITOR, THE SELLER AND THE SERVICER
SECTION 6.01 Respective Liabilities of the Depositor,
the Seller and the Servicer..............................89
ii
SECTION 6.02 Merger or Consolidation of the Depositor,
the Seller or the Servicer...............................89
SECTION 6.03 Limitation on Liability of the Depositor,
the Seller, the Servicer and Others......................89
SECTION 6.04 Limitation on Resignation of the Servicer................90
SECTION 6.05 Limitation Upon Liability of the Loss Mitigation Advisor.90
ARTICLE VII
DEFAULT
SECTION 7.01 Events of Default........................................91
SECTION 7.02 Trustee to Act; Appointment of Successor.................93
SECTION 7.03 Notification to Certificateholders.......................94
ARTICLE VIII
CONCERNING THE TRUSTEE
SECTION 8.01 Duties of the Trustee....................................95
SECTION 8.02 Certain Matters Affecting the Trustee....................96
SECTION 8.03 Trustee Not Liable for Certificates or Mortgage Loans....97
SECTION 8.04 Trustee May Own Certificates.............................98
SECTION 8.05 Trustee's Fees and Expenses..............................98
SECTION 8.06 Eligibility Requirements for the Trustee.................98
SECTION 8.07 Resignation and Removal of the Trustee...................99
SECTION 8.08 Successor Trustee.......................................100
SECTION 8.09 Merger or Consolidation of the Trustee..................100
SECTION 8.10 Appointment of Co-Trustee or Separate Trustee...........100
SECTION 8.11 Tax Matters.............................................102
SECTION 8.12 Periodic Filings........................................104
SECTION 8.13 Trust Obligations.......................................105
SECTION 8.14 Determination of Certificate Index......................105
SECTION 8.15 Indemnification with Respect to Certain Taxes
and Loss of REMIC Status...............................105
ARTICLE IX
TERMINATION
SECTION 9.01 Termination upon Liquidation or
Purchase of the Mortgage Loans..........................106
SECTION 9.02 Final Distribution on the Certificates..................106
SECTION 9.03 Additional Termination Requirements.....................107
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.01 Amendment...............................................109
SECTION 10.02 Recordation of Agreement; Counterparts..................110
SECTION 10.03 Governing Law...........................................111
iii
SECTION 10.04 Intention of Parties....................................111
SECTION 10.05 Notices.................................................111
SECTION 10.06 Severability of Provisions..............................112
SECTION 10.07 Assignment..............................................112
SECTION 10.08 Limitation on Rights of Certificateholders..............112
SECTION 10.09 Certificates Nonassessable and Fully Paid...............113
SECTION 10.10 Protection of Assets....................................113
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EXHIBITS
EXHIBIT A Form of Class A Certificates
EXHIBIT B Form of Class M Certificates
EXHIBIT C Form of Class B Certificate
EXHIBIT D Form of Residual Certificate
EXHIBIT E Form of Class X Certificate
EXHIBIT F Form of Interest Only Certificate
EXHIBIT G Form of Initial Certification
(and Subsequent Certification) of Trustee
EXHIBIT H Form of Final Certification of Trustee
EXHIBIT I Transfer of Affidavit
EXHIBIT J Form of Transferor Certificate
EXHIBIT K Form of Investment Letter (Non-rule 144A)
EXHIBIT L Form of Rule 144A Letter
EXHIBIT M Request for Release
EXHIBIT N Officer's Certificate
with Respect to Principal Prepayments
EXHIBIT O MGIC Policy
EXHIBIT P Form of Servicer Report
EXHIBIT Q FSA Policy
EXHIBIT R Form of Subsequent Transfer Agreement
SCHEDULE I Mortgage Loan Schedule with
Closing Date Representations and Warranties
SCHEDULE IIA Representations and Warranties of Seller - DLJMC
SCHEDULE IIB Representations and Warranties of Servicer
and Special Servicer - Vesta
SCHEDULE IIIA Representations and Warranties - Mortgage Loans
v
THIS POOLING AND SERVICING AGREEMENT, dated as of August 1, 2001, among
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP., a Delaware corporation,
as the depositor (the "Depositor"), DLJ MORTGAGE CAPITAL, INC., a Delaware
corporation, as the Seller (the "Seller"), VESTA SERVICING L.P., a Delaware
limited partnership, as servicer (in such capacity, the "Servicer") and as the
special servicer (in such capacity, the "Special Servicer"), and U.S. BANK
NATIONAL ASSOCIATION, a national banking association, as the trustee (the
"Trustee").
WITNESSETH THAT
In consideration of the mutual agreements herein contained, the parties
hereto agree as follows:
PRELIMINARY STATEMENT
For federal income tax purposes, the Trust Fund (exclusive of the
Prefunding Account, the Capitalized Interest Account and the Basis Risk
Reserve Fund) will consist of two REMICs: the Subsidiary REMIC and the Master
REMIC.
Subsidiary REMIC
----------------
The Subsidiary REMIC will consist of all of the assets constituting the
Mortgage Loans (exclusive of the Prefunding Account, the Capitalized Interest
Account and the Basis Risk Reserve Fund) and will be evidenced by REMIC
regular interests which will be uncertificated and will represent the "regular
interests" in the Subsidiary REMIC (the "Subsidiary REMIC Regular Interests")
and the REMIC residual interest as the single "residual interest" in the
Subsidiary REMIC (the "Subsidiary REMIC Residual Interest"). The Trustee will
hold the Subsidiary REMIC Regular Interests on behalf of the Master REMIC.
The following table irrevocably sets forth the class designation, the
Pass-Through Rate, and the original class principal balance for each of the
Subsidiary REMIC Regular Interests. None of the Subsidiary REMIC Regular
Interests will be certificated.
1
------------- ---------------------------- ---------------- -------------------
Corresponding
REMIC Initial Interest Class of Master
Interests Balance Rate REMIC Interest
------------- ---------------------------- ---------------- -------------------
ST-A-1 1/2 Corresponding Master Net WAC Rate A-1
REMIC Class balance
ST-A-2 1/2 Corresponding Master Net WAC Rate A-2
REMIC Class balance
ST-M-1 1/2 Corresponding Master Net WAC Rate M-1
REMIC Class balance
ST-M-2 1/2 Corresponding Master Net WAC Rate M-2
REMIC Class balance
ST-B 1/2 Corresponding Master Net WAC Rate B
REMIC Class balance
R-I 1/2 Corresponding Master Net WAC Rate R
REMIC Class balance
ST-Accrual 1/2 Principal Balance plus Net WAC Rate N/A
1/2 of the initial
Overcollateralization Amount
ST-P
------------- ---------------------------- ---------------- -------------------
__________________
On each Distribution Date, 50% of the increase in the
Overcollateralization Amount will be payable as a reduction of the principal
balances of the Subsidiary REMIC Regular Interest and Subsidiary REMIC
Residual Interest (excluding the ST-Accrual Interest) (the "Subsidiary
Accretion Directed Classes") to each such class in an amount equal to 1/2 of
the interest paid in reduction of the principal balance of the Corresponding
Class of Master REMIC Interest) to each such Class in an amount equal to 1/2
of the interest paid in reduction of the principal balance of the
Corresponding Class of Master REMIC Interest and will be accrued and added to
the principal balance of the ST-Accrual Interest. On each Distribution Date,
the increase in the principal balance of the ST-Accrual Interest may not
exceed interest accruals for such Distribution Date for the ST-Accrual
Interest. In the event that: (i) 50% of the increase in the
Overcollateralization Amount exceeds (ii) interest accruals on the ST-Accrual
Interest for such Distribution Date, the excess for such Distribution Date
(accumulated with all such excesses for all prior Distribution Dates) will be
added to any increase in the Overcollateralization Amount for purposes of
determining the amount of interest accrual on the ST-Accrual Interest payable
as principal on the Subsidiary REMIC Accretion Directed Classes on the next
Distribution Date pursuant to the first sentence of this paragraph. All
payments of scheduled principal and prepayments of principal generated by the
Mortgage Loans shall be allocated 50% to the ST-Accrual Interest, and 50% to
the Subsidiary REMIC Accretion Directed Classes to each such Class in an
amount equal to 1/2 of the interest paid in reduction of the principal balance
of the Corresponding Class of Master REMIC Interest, until paid in full of the
interest paid in reduction of the principal balance of the Corresponding Class
of Master REMIC Interest). Notwithstanding the above, principal payments
allocated to the Master REMIC's Class X Certificates that result in the
reduction in the Overcollateralization Amount shall be allocated to the
ST-Accrual Interest (until paid in full). Realized losses shall be applied so
that after all distributions have been made on each Distribution Date (i) the
principal balances of each of the Subsidiary REMIC Accretion Directed Classes
is equal to 50% of the principal balance of their Corresponding Class, and
(ii) the ST-
2
Accrual Interest is equal to 50% of the aggregate principal balance of the
Mortgage Pool plus 50% of the Overcollateralization Amount.
Master REMIC
------------
The following table sets forth (or describes) the Class designation,
Pass-Through Rate and Original Class Certificate Principal Balance for each
Class of Certificates which, including the Class R Certificate (and R-II
Interest), represents one or more of the "regular interests" in the Master
REMIC created hereunder:
Integral
Original Class Multiples in
Class Certificate Pass-Through Assumed Final Minimum Excess of
Designation Principal Balance Rate Maturity Date(l) Denominations Minimum
------------- ----------------- ------------ --------------- ------------- -------------
Class A-1 $319,000,000 3.89% (2) January 25, 2032 $25,000 $1
Class A-2 $ 50,000,000 3.83% (2) January 25, 2032 $25,000 $1
Class A-IO(3) $369,000,000(4) (5) January 25, 2032 $25,000 $1
Class M-1 $ 16,400,000 4.30% (2) January 25, 2032 $25,000 $1
Class M-2 $ 14,350,000 4.78% (2) January 25, 2032 $25,000 $1
Class B $ 10,250,000 5.98% (2) January 25, 2032 $25,000 $1
Class X (6) (6) January 25, 2032 (7) NA
Class R(8) $ 50 3.89% (2) January 25, 2032 (9) NA
Class P(10) $ 100 (11) January 25, 2032 NA NA
(1) Solely for purposes of Section 1.A60G-1(a)(4)(iii) of the Treasury
regulations, the Distribution Date in the month following the month of
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 that represents one or more of the "regular interests" in
the Master REMIC.
(2) Per annum rate applicable to the September 2001 Distribution Date. For
each other Distribution Date, the Pass-Through Rate shall be calculated
in accordance with the definition of "Pass-Through Rate" herein.
(3) Solely for federal income tax purposes, the Class A-IO Interest will be a
REMIC regular interest. The Class A-IO Certificates will represent a
beneficial interest in the Class A-IO Interest and the Class P Interest.
(4) The Class A-IO Certificates accrue interest on the Class A-IO Notional
Amount.
(5) For each distribution date, a per annum rate equal to the lesser of (a)
the excess, if any, of 8.00% over one month LIBOR for that distribution
date and (b) the excess, if any, of the Net Funds Cap (without adjustment
to give effect to the actual number of days in the related Accrual
Period) over the weighted average of the pass-through rates for the Class
A-1 and Class A-2 Certificates for such distribution date (adjusted to a
basis of a 360 day year of twelve 30 day months).
(6) The Class X Certificate will have a notional balance equal to the pool
balance, and a rate equal to the excess of the Net WAC Rate over the
product of (i) 2 and (ii) the weighted average rate of the Subsidiary
REMIC Interests with each Subsidiary REMIC Accretion Directed Class
subject to a cap equal to the pass through rate in respect of the
Corresponding Master REMIC Class and the ST-Accrual Interest subject to a
cap equal to zero.
(7) The Class X Certificates will be issued as a single certificate.
(8) Solely for federal income tax purposes, the Master REMIC will issue the
R-II Interest. The Class R Certificate will represent the R-I Interest
and the R-II Interest.
(9) The Class R Certificates are issued in minimum Percentage Interests of
20%.
(10) Solely for federal income tax purposes, the Class P Interest will be an
uncertificated REMIC regular interest. The Class P Interest will not be
entitled to any stated interest. The Class P Interest, however, will be
entitled to all Prepayment Premiums.
Set forth below are designations of Classes of Certificates to the
categories used herein:
3
Book-Entry Certificates............ All Classes of Certificates other than
the Physical Certificates.
Class B Certificates............... The Class B Certificates.
Class M Certificates............... The Class M-1 Certificates and
Class M-2 Certificates.
Class X Certificates............... The Class X Certificates.
ERISA-Restricted Certificates...... Residual Certificates, Class X
Certificates and any Certificates of
any other Class that no longer
satisfies the applicable rating
requirements of the Underwriters'
Exemption.
LIBOR Certificates................. Class X-0, Xxxxx X-0, Class M-1,
Class M-2, Class B and Class R
Certificates.
Notional Amount Certificates....... Class X Certificates.
Offered Certificates............... All Classes of Certificates other than
the Private Certificates.
Private Certificates............... Class X Certificates.
Physical Certificates.............. Class R and Class X Certificates.
Rating Agencies.................... Xxxxx'x and S&P.
Regular Certificates............... All Classes of Certificates other than
the Class R Certificates.
Residual Certificates.............. Class R Certificates.
Senior Certificates................ Class A-1 Certificates, Class A-2
Certificates, Class A-IO Certificate
and Class R Certificates.
Subordinate Certificates........... Class M-1 Certificates, Class M-2
Certificates, Class B Certificates and
Class X Certificates.
4
ARTICLE I
DEFINITIONS
SECTION 1.01 Definitions.
Whenever used in this Agreement, the following words and phrases, unless
the context otherwise requires, shall have the following meanings:
Accepted Servicing Practices: With respect to any Mortgage Loan, those
mortgage servicing practices of prudent mortgage lending institutions which
service mortgage loans of the same type as such Mortgage Loan in the
jurisdiction where the related Mortgaged Property is located.
Accrual Period: For any interest-bearing Class of Certificates, the
period beginning on the immediately preceding Distribution Date (or the
Closing Date, in the case of the first Accrual Period) and ending on the day
immediately preceding the related Distribution Date.
Advance: The payment required to be made by the Servicer with respect to
any Distribution Date pursuant to Section 4.01.
Adjustment Date: With respect to each adjustable-rate first lien Mortgage
Loan each adjustment date on which the Mortgage Rate thereon changes pursuant
to the related Mortgage Note. The first Adjustment Date following the Cut-off
Date as to each such adjustable-rate first lien Mortgage Loan is set forth in
the Mortgage Loan Schedule.
Aggregate Balance: As of any date of determination will be equal to the
aggregate of the Stated Principal Balances of the Mortgage Loans as of the
last day of the prior month.
Aggregate Collateral Balance: As of any date of determination will be
equal to the Aggregate Loan Balance plus the amount, if any, then on deposit
in the Pre-Funding Account.
Aggregate Subsequent Transfer Amount: With respect to any Subsequent
Transfer Date, the aggregate Stated Principal Balances as of the applicable
Cut-off Date of the Subsequent Mortgage Loans conveyed on such Subsequent
Transfer Date, as listed on the revised Mortgage Loan Schedule delivered
pursuant to Section 2.01(e); provided, however, that such amount shall not
exceed the amount on deposit in the Prefunding Account.
Agreement: This Pooling and Servicing Agreement and all amendments or
supplements hereto.
Ancillary Income: All income derived from the Mortgage Loans, other than
Servicing Fees, including but not limited to, late charges, fees received with
respect to checks or bank drafts returned by the related bank for
non-sufficient funds, assumption fees, optional insurance administrative fees
and all other incidental fees and charges, including investment income on the
applicable Collection Account. Ancillary Income does not include any
Prepayment Premiums.
5
Applied Loss Amount: As to any Distribution Date, an amount equal to the
excess, if any of (i) the aggregate Class Principal Balance of the
Certificates, after giving effect to all Realized Losses incurred with respect
to Mortgage Loans during the Due Period for such Distribution Date and
payments of principal on such Distribution Date over (ii) the Aggregate
Collateral Balance for such Distribution Date.
Appraised Value: The amount set forth in an appraisal made in connection
with the origination of the related Mortgage Loan as the value of the
Mortgaged Property.
Assignment and Assumption Agreement: That certain assignment and
assumption agreement dated as of August 1, 2001, by and between DLJMC, as
assignor and the Depositor, as assignee, relating to the Mortgage Loans.
Assignment of Mortgage: An assignment of the Mortgage, notice of transfer
or equivalent instrument in recordable form, sufficient under the laws of the
jurisdiction wherein the related Mortgaged Property is located to reflect the
transfer of the Mortgage.
B Principal Payment Amount: For any Distribution Date on or after the
Stepdown Date and as long as a Trigger Event has not occurred with respect to
such Distribution Date, will be the amount, if any, by which (x) the sum of
(i) the aggregate Class Principal Balance of the Senior Certificates and the
aggregate Class Principal Balances of the Class M-1 Certificates and Class M-2
Certificates, in each case, after giving effect to payments on such
Distribution Date and (ii) the Class Principal Balance of the Class B
Certificates immediately prior to such Distribution Date exceeds (y) the
lesser of (A) the product of (i) 98.00%% and (ii) the Aggregate Collateral
Balance for such Distribution Date and (B) the amount, if any, by which (i)
the Aggregate Collateral Balance for such Distribution Date exceeds (ii) 0.50%
of the Aggregate Collateral Balance as of the Cut-off Date.
Balloon Loan: Any Mortgage Loan which, by its terms, does not fully
amortize the principal balance thereof by its stated maturity and thus
requires a payment at the stated maturity larger than the monthly payments due
thereunder.
Bankruptcy Code: The United States Bankruptcy Reform Act of 1978, as
amended.
Basis Risk Reserve Fund: The separate Eligible Account created and
initially maintained by the Trustee pursuant to Section 4.06 in the name of
the Trustee for the benefit of the Certificateholders and designated "U.S.
Bank National Association, in trust for registered holders of Credit Suisse
First Boston Mortgage Securities Corp., Mortgage Pass-Through Certificates,
Series 2001-HE17." The Basis Risk Reserve Fund shall not be part of any REMIC.
Funds in the Basis Risk Reserve Fund shall be held in trust for the
Certificateholders for the uses and purposes set forth in this Agreement.
Basis Risk Shortfall: For any Class of LIBOR Certificates and any
Distribution Date, the sum of (i) the excess, if any, of the related Current
Interest calculated on the basis of the lesser of (x) the Certificate Index
plus the applicable Certificate Margin and (y) the Maximum Interest Rate over
the related Current Interest for the applicable Distribution Date; (ii) any
Basis Risk Shortfall remaining unpaid from prior Distribution Dates; and (iii)
30 days interest on the amount
6
in clause (ii) calculated at a per annum rate equal to the lesser of (x) the
Certificate Index plus the applicable Certificate Margin and (y) the Maximum
Interest Rate.
Book-Entry Certificates: As specified in the Preliminary Statement.
Business Day: Any day other than (i) a Saturday or a Sunday, or (ii) a
day on which banking institutions in the City of New York, New York, or the
city in which the Corporate Trust Office of the Trustee is located, or savings
and loan institutions in the States of California, Illinois, Minnesota or
Texas are authorized or obligated by law or executive order to be closed.
Capitalized Interest Account: The separate Eligible Account designated as
such and created and maintained by the Trustee pursuant to Section 3.06(h)
hereof. The Capitalized Interest Account shall be treated as an "outside
reserve fund" under applicable Treasury regulations and shall not be part of
any REMIC. Except as provided in Section 3.06(h) hereof, any investment
earnings on the Capitalized Interest Account shall be treated as owned by the
Depositor and will be taxable to the Depositor.
Capitalized Interest Deposit: $550,000.00.
Capitalized Interest Requirement: With respect to the September 2001
Distribution Date, an amount equal to 33 days of interest accruing at a per
annum rate equal to the sum of (a) the weighted average Pass-Through Rate of
the Offered Certificates (other than the Class A-IO Certificates) and (b)
3.98% on the Pre-Funded Amount outstanding at the end of the related Due
Period. With respect to each of the October and November Distribution Dates,
an amount equal to interest accruing during the related Accrual Period at a
per annum rate equal to the sum of (a) the weighted average Pass-Through Rate
of the Offered Certificates (other than the Class A-IO Certificates) for such
Distribution Date and (b) 3.75% or 3.53% on the sum of the Pre-Funded Amount
at the end of the related Due Period and the aggregate Stated Principal
Balance of the Subsequent Mortgage Loans that do not have a first Due Date
prior to October 1, 2001 and November 1, 2001, respectively, transferred to
the Trust during the related Due Period.
Carryforward Interest: For any Class of Offered Certificates and
Distribution Date, the sum of (1) the amount, if any, by which (x) the sum of
(A) Current Interest for such Class for the immediately preceding Distribution
Date and (B) any unpaid Carryforward Interest from the immediately preceding
Distribution Date exceeds (y) the amount paid in respect of interest on such
Class on such immediately preceding Distribution Date, and (2) interest on
such amount for the related Accrual Period at the applicable Pass-Through Rate
for such Distribution Date.
Certificate: Any one of the Certificates executed by the Trustee in
substantially the forms attached hereto as exhibits.
Certificate Account: The separate Eligible Account created and maintained
with the Trustee, or any other bank or trust company acceptable to the Rating
Agencies which is incorporated under the laws of the United States or any
state thereof pursuant to Section 3.05, which account shall bear a designation
clearly indicating that the funds deposited therein are held in trust for the
benefit of the Trustee on behalf of the Certificateholders or any other
account serving a similar function acceptable to the Rating Agencies.
7
Certificate Balance: With respect to any Certificate at any date, the
maximum dollar amount of principal to which the Holder thereof is then
entitled hereunder, such amount being equal to the Denomination thereof minus
all distributions of principal previously made with respect thereto and, in
the case of any Subordinate Certificates, reduced by any Applied Loss Amounts
allocated to such Class on prior Distribution Dates pursuant to Section 4.03.
Exclusively for the purpose of determining any subrogation rights of FSA
arising under Section 4.07 hereof, "Certificate Balance" of the Class A-2
Certificates shall not be reduced by the amount of any payments made by FSA in
respect of principal on such Certificates under the FSA Policy, except to the
extent such payment shall have been reimbursed to FSA pursuant to the
provisions of this Agreement.
Certificate Index: With respect to each Distribution Date, the rate for
one month United States dollar deposits quoted on Telerate Page 3750 as of
11:00 a.m., London time, on the related Interest Determination Date relating
to each Class of LIBOR Certificates. 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 LIBOR or
comparable rates as may be reasonably selected by the Trustee), the rate will
be the Reference Bank Rate. If no such quotations can be obtained and no
Reference Bank Rate is available, the Certificate Index will be the
Certificate Index applicable to the preceding Distribution Date. On the
Interest Determination Date immediately preceding each Distribution Date, the
Trustee shall determine the Certificate Index for the Accrual Period
commencing on such Distribution Date and inform the Servicer of such rate.
Certificate Margin: As to each Class of LIBOR Certificates, the
applicable amount set forth below:
Class Certificate Margin
(1) (2)
A-1 0.31% 0.62%
A-2 0.25% 0.50%
M-1 0.72% 1.08%
M-2 1.20% 1.70%
B 2.40% 2.90%
R 0.31% 0.62%
_______________________
(1) Prior to the Optional Termination Date.
(2) On and after the Optional Termination Date.
Certificate Owner: With respect to a Book-Entry Certificate, the Person
who is the beneficial owner of such Book-Entry Certificate.
Certificate Register: The register maintained pursuant to Section 5.02.
Certificateholder or Holder: The person in whose name a Certificate is
registered in the Certificate Register, except that, solely for the purpose of
giving any consent pursuant to this Agreement, any Certificate registered in
the name of the Depositor or any affiliate of the Depositor shall be deemed
not to be Outstanding and the Percentage Interest evidenced thereby
8
shall not be taken into account in determining whether the requisite amount of
Percentage Interests necessary to effect such consent has been obtained;
provided, however, that if any such Person (including the Depositor) owns 100%
of the Percentage Interests evidenced by a Class of Certificates, such
Certificates shall be deemed to be Outstanding for purposes of any provision
hereof that requires the consent of the Holders of Certificates of a
particular Class as a condition to the taking of any action hereunder. The
Trustee is entitled to rely conclusively on a certification of the Depositor
or any affiliate of the Depositor in determining which Certificates are
registered in the name of an affiliate of the Depositor.
Class: All Certificates bearing the same class designation as set forth
in the Preliminary Statement.
Class A-IO Notional Amount: For any distribution date, the aggregate of
the Class Principal Balances of the Class A-1 and Class A-2 Certificates
immediately prior to that distribution date.
Class Principal Balance: With respect to any Class and as to any date of
determination, the aggregate of the Certificate Balances of all Certificates
of such Class as of such date.
Class X Distributable Amount: With respect to any Distribution Date, the
sum of (a) the product of the Pool Balance and the Class X Pass-Through Rate
as set forth in the Preliminary Statement plus (b) any Overcollateralization
Release Amounts, less any amounts distributed pursuant to Section 4.01(d)A.
through J. hereof on such Distribution Date.
Closing Date: August 23, 2001.
Code: The Internal Revenue Code of 1986, as the same may be amended from
time to time (or any successor statute thereto).
Collection Account: The accounts established and maintained by the
Servicer in accordance with Section 3.06.
Compensating Interest Payment: For any Distribution Date and the Mortgage
Loans, the lesser of (i) 0.50% per annum of the aggregate Stated Principal
Balance of the Mortgage Loans as of the Due Date in the month of such
Distribution Date and (ii) the aggregate Prepayment Interest Shortfall
allocable to Payoffs for the Mortgage Loans.
Corporate Trust Office: The designated office of the Trustee in the State
of Minnesota at which at any particular time its corporate trust business with
respect to this Agreement shall be administered, which office at the date of
the execution of this Agreement is located at 000 Xxxx Xxxxx Xxxxxx, Xx. Xxxx,
XX 00000, Attn: Corporate Trust Structured Finance, Ref: CSFB 2001-HE17.
Current Interest: For any interest bearing Class of Offered Certificates
and Distribution Date, the amount of interest accruing at the applicable
Pass-Through Rate on the related Class Principal Balance or Class A-IO
Notional Amount, as applicable, of such Class during the related Accrual
Period; provided, that if and to the extent that on any Distribution Date the
Interest Remittance Amount is less than the aggregate distributions required
pursuant to Section
9
4.02(a) without regard to this proviso as a result of Interest Shortfalls,
then the Current Interest on each Class will be reduced, on a pro rata basis
in proportion to the amount of Current Interest for each Class without regard
to this proviso, by such Interest Shortfalls for such Distribution Date.
Curtailment: Any payment of principal on a Mortgage Loan, made by or on
behalf of the related Mortgagor, other than a Scheduled Payment, a prepaid
Scheduled Payment or a Payoff, which is applied to reduce the outstanding
Stated Principal Balance of the Mortgage Loan.
Custodian: Bank One Trust Company, N.A., a national banking association,
or its successor in interest.
Custodial Agreement: The Custodial Agreement dated as of the date hereof,
among the Custodian and the Trustee.
Cut-off Date: For any Initial Mortgage Loan, August 1, 2001. For any
Subsequent Mortgage Loan, the applicable Subsequent Transfer Date.
Cut-off Date Pool Principal Balance: $382,617,975.11 plus $27,382,074.88,
deposited to the Prefunding Account on the Closing Date.
Cut-off Date Principal Balance: As to any Mortgage Loan, the Stated
Principal Balance thereof as of the close of business on the Cut-off Date.
Defective Mortgage Loan: Any Mortgage Loan which is required to be
repurchased pursuant to Section 2.02 or 2.03.
Deferred Amount: For any Class of Subordinate Certificates (other than
the Class X Certificates) and Distribution Date, will equal the amount by
which (x) the aggregate of the Applied Loss Amounts previously applied in
reduction of the Class Principal Balance thereof exceeds (y) the aggregate of
amounts previously paid in reimbursement thereof.
Definitive Certificates: Any Certificate evidenced by a Physical
Certificate and any Certificate issued in lieu of a Book-Entry Certificate
pursuant to Section 5.02(e).
Deleted Mortgage Loan: As defined in Section 2.03(d).
Delinquency Rate: For any month will be, generally, the fraction,
expressed as a percentage, the numerator of which is the aggregate outstanding
principal balance of all Mortgage Loans 60 or more days delinquent (including
all foreclosures, bankruptcies and REO Properties) as of the close of business
on the last clay of such month, and the denominator of which is the Aggregate
Collateral Balance as of the close of business on the last day of such month.
Denomination: With respect to each Certificate, the amount set forth on
the face thereof as the "Initial Certificate Balance of this Certificate" or
the "Initial Notional Amount of this Certificate" or, if neither of the
foregoing, the Percentage Interest appearing on the face thereof.
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Depositor: Credit Suisse First Boston Mortgage Securities Corp., a
Delaware corporation, or its successor in interest.
Depository: The initial Depository shall be The Depository Trust Company,
the nominee of which is CEDE & Co., as the registered Holder of the Book-Entry
Certificates. The Depository shall at all times be a "clearing corporation" as
defined in Section 8-102(a)(5) of the Uniform Commercial Code of the State of
New York.
Depository Participant: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
Determination Date: As to any Distribution Date and any Mortgage Loan,
the Business Day immediately preceding the 18th day of each month.
Distribution Date: The 25th day of each month or if such day is not a
Business Day, the first Business Day thereafter, in each case commencing in
September 2001.
Disqualified Organization: A "disqualified organization" under Section
860E of the Code, which as of the Closing Date is any of: (i) the United
States, any State or political subdivision thereof, any foreign government,
any international organization, or any agency or instrumentality of any of the
foregoing, (ii) any organization (other than a cooperative described in
Section 521 of the Code) which is exempt from the tax imposed by Chapter 1 of
the Code unless such organization is subject to the tax imposed by Section 511
of the Code, (iii) any organization described in Section 1381(a)(2)(C) of the
Code, (iv) an "electing large partnership" within the meaning of Section 775
of the Code or (v) any other Person so designated by the Trustee based upon an
Opinion of Counsel provided by nationally recognized counsel to the Trustee
that the holding of an ownership interest in a Class R Certificate by such
Person may cause the Trust Fund or any Person having an ownership interest in
any Class of Certificates (other than such Person) to incur liability for any
federal tax imposed under the Code that would not otherwise be imposed but for
the transfer of an ownership interest in the Class R Certificate to such
Person. A corporation will not be treated as an instrumentality of the United
States or of any state or political subdivision thereof, if all of its
activities are subject to tax and, a majority of its board of directors is not
selected by a governmental unit. The term "United States", "State" and
"international organizations" shall have the meanings set forth in Section
7701 of the Code.
DLJMC: DLJ Mortgage Capital, Inc., a Delaware corporation, and its
successors and assigns.
Due Date: With respect to each Mortgage Loan and any Distribution Date,
the date on which Scheduled Payments on such Mortgage Loan are due which is
either the first day of the month of such Distribution Date, or if Scheduled
Payments on such Mortgage Loan are due on a day other than the first day of
the month, the first day of the calendar month in which such Scheduled
Payments are due, exclusive of any days of grace.
Due Period: With respect to any Distribution Date, the period commencing
on the second day of the month preceding the month in which such Distribution
Date occurs and ending on the first day of the month in which such
Distribution Date occurs.
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Eligible Account: Either (i) an account or accounts maintained with a
federal or state chartered depository institution or trust company acceptable
to the Rating Agencies or (ii) an account or accounts the deposits in which
are insured by the FDIC to the limits established by such corporation,
provided that any such deposits not so insured shall be maintained in an
account at a depository institution or trust company whose commercial paper or
other short term debt obligations (or, in the case of a depository institution
or trust company which is the principal subsidiary of a holding company, the
commercial paper or other short term debt obligations of such holding company)
have been rated by each Rating Agency in its highest short-term rating
category, or (iii) a segregated trust account or accounts (which shall be a
"special deposit account") maintained with the Trustee or any other federal or
state chartered depository institution or trust company, acting in its
fiduciary capacity. Eligible Accounts may bear interest.
Eligible Investments: Any one or more of the obligations and securities
listed below:
(i) direct obligations of, and obligations fully guaranteed by, the
United States of America, or any agency or instrumentality of the United
States of America the obligations of which are backed by the full faith
and credit of the United States of America; or obligations fully
guaranteed by, the United States of America; the FHLMC, FNMA, the Federal
Home Loan Banks or any agency or instrumentality of the United States of
America rated Aa3 or higher by Xxxxx'x;
(ii) federal funds, demand and time deposits in, certificates of
deposits of, or bankers' acceptances issued by, any depository
institution or trust company incorporated or organized under the laws of
the United States of America or any state thereof and subject to
supervision and examination by federal and/or state banking authorities,
so long as at the time of such investment or contractual commitment
providing for such investment the commercial paper or other short-term
debt obligations of such depository institution or trust company (or, in
the case of a depository institution or trust company which is the
principal subsidiary of a holding company, the commercial paper or other
short-term debt obligations of such holding company) are rated in the
highest ratings by each Rating Agency, and the long-term debt obligations
of such depository institution or trust company (or, in the case of a
depository institution or trust company which is the principal subsidiary
of a holding company, the long-term debt obligations of such holding
company) are rated in one of two of the highest ratings, by each Rating
Agency;
(iii) repurchase obligations with a term not to exceed 30 days with
respect to any security described in clause (i) above and entered into
with a depository institution or trust company (acting as a principal)
the short-term debt obligations of which are rated A-1 or higher by S&P
rated A-2 or higher by Xxxxx'x; provided, however, that collateral
transferred pursuant to such repurchase obligation must be of the type
described in clause (i) above and must (A) be valued daily at current
market price plus accrued interest, (B) pursuant to such valuation, be
equal, at all times, to 105% of the cash transferred by the Trustee in
exchange for such collateral, and (C) be delivered to the Trustee or, if
the Trustee is supplying the collateral, an agent for the Trustee, in
such a manner as to accomplish perfection of a security interest in the
collateral by possession of certificated securities;
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(iv) securities bearing interest or sold at a discount issued by any
corporation incorporated under the laws of the United States of America
or any state thereof which has a long-term unsecured debt rating in the
highest available rating category of Xxxxx'x, and a short-term unsecured
debt rating of A-1 or higher by S&P, at the time of such investment;
(v) commercial paper having an original maturity of less than 365
days and issued by an institution having a short-term unsecured debt
rating in the highest available rating category by each Rating Agency, at
the time of such investment;
(vi) a guaranteed investment contract approved by each of the Rating
Agencies and issued by an insurance company or other corporation having a
long-term unsecured debt rating in the highest available rating category
of Xxxxx'x, and a short-term unsecured debt rating of A-1 or higher by
S&P, at the time of such investment; and
(vii) money market funds having ratings in the highest available
rating category of Xxxxx'x and either "AAAm" or "AAAm-G" of S&P at the
time of such investment (any such money market funds which provide for
demand withdrawals being conclusively deemed to satisfy any maturity
requirements for Eligible Investments set forth herein) including money
market funds of the Servicer or the Trustee and any such funds that are
managed by the Servicer or the Trustee or their respective Affiliates or
for the Servicer or the Trustee or any Affiliate of either acts as
advisor, as long as such money market funds satisfy the criteria of this
subparagraph (vii);
provided, however, that no such instrument shall be an Eligible Investment if
such instrument evidences either (i) a right to receive only interest payments
with respect to the obligations underlying such instrument, or (ii) both
principal and interest payments derived from obligations underlying such
instrument and the principal and interest payments with respect to such
instrument provide a yield to maturity of greater than 120% of the yield to
maturity at par of such underlying obligations.
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
ERISA-Restricted Certificate: As specified in the Preliminary Statement.
ERISA-Qualifying Underwriting: With respect to any ERISA-Restricted
Certificate, a best efforts or firm commitment underwriting or private
placement that meets the requirements (without regard to the ratings
requirements) of the Underwriters' Exemption.
Errors and Omissions Insurance Policy: An errors and omissions insurance
policy to be maintained by the Servicer pursuant to Section 3.19.
Escrow Account: The separate account or accounts created and maintained
by the Servicer pursuant to Section 3.07.
Escrow Payments: With respect to any Mortgage Loan, the amounts
constituting ground rents, taxes, mortgage insurance premiums, fire and hazard
insurance premiums, and any other
13
payments required to be escrowed by the Mortgagor with the mortgagee pursuant
to the Mortgage, applicable law or any other related document.
Event of Default: As defined in Section 7.01.
Expense Fee: As to each Mortgage Loan, the sum of the related Servicing
Fee, the Loss Mitigation Advisor's Fee, the Trustee Fee, any Lender paid
Primary Insurance Policy premium, if applicable and the MGIC Fee, if
applicable.
Expense Fee Rate: As to each Mortgage Loan, the sum of the related
Servicing Fee Rate, the Trustee Fee Rate, the Loss Mitigation Advisor's Fee
Rate, the rate at which any Lender paid Primary Insurance Policy premium is
calculated, if applicable and the MGIC Fee Rate, if applicable.
FDIC: The Federal Deposit Insurance Corporation, or any successor
thereto.
FHLMC: The Federal Home Loan Mortgage Corporation, a corporate
instrumentality of the United States created and existing under Title III of
the Emergency Home Finance Act of 1970, as amended, or any successor thereto.
Fidelity Bond: A fidelity bond to be maintained by the Servicer pursuant
to Section 3.18.
Final Scheduled Distribution Date: The Distribution Date in January 2032.
FIRREA: The Financial Institutions Reform, Recovery and Enforcement Act
of 1989.
FNMA: The Federal National Mortgage Association, a federally chartered
and privately owned corporation organized and existing under the Federal
National Mortgage Association Charter Act, or any successor thereto.
FNMA Guides: The FNMA Sellers' Guide and the FNMA Servicers' Guide and
all amendments or additions thereto.
FSA: Financial Security Assurance Inc., a monoline insurance company
incorporated in 1984 under the laws of the State of New York. FSA is licensed
to engage in financial guaranty insurance business in all 50 states, the
District of Columbia, Puerto Rico and the U.S. Virgin Islands.
FSA Account: The account established pursuant to Section 4.07(c) hereof.
FSA Policy: The irrevocable Certificate Guaranty Insurance Policy, No.
51153-N including any endorsements thereto, issued by FSA with respect to the
Class A-2 Certificates, in the form attached hereto as Exhibit Q.
FSA Premium: With respect to any Distribution Date, an amount equal to
1/12th of the product of (a) the Class Principal Balance of the Class A-2
Certificates as of such Distribution Date (prior to giving effect to any
distributions thereon on such Distribution Date) and (b) the Premium
Percentage.
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FSA Reimbursement Amount: The sum of (i) all amounts paid by FSA under
the FSA Policy which have not been previously reimbursed, (ii) all unpaid FSA
Premiums, (iii) all amounts due to FSA under this Agreement and (iv) interest
on the foregoing at the Late Payment Rate.
Gross Margin: With respect to each adjustable-rate first lien 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
Mortgage Note used to determine the Mortgage Rate for such Mortgage Loan.
Guaranteed Distributions: As defined in the FSA Policy.
Index: With respect to each adjustable-rate Mortgage Loan and with
respect to each related Adjustment Date, the index as specified in the related
Mortgage Note.
Indirect Participant: A broker, dealer, bank or other financial
institution or other Person that clears through or maintains a custodial
relationship with a Depository Participant.
Initial Mortgage Loan: A Mortgage Loan conveyed to the Trust Fund on the
Closing Date pursuant to this Agreement as identified on the Mortgage Loan
Schedule delivered to the Trustee on the Closing Date.
Insolvency Proceeding: As defined in Section 4.07(h).
Insurance Policy: With respect to any Mortgage Loan included in the Trust
Fund, any Primary Insurance Policy, the MGIC Policy, any standard hazard
insurance policy, flood insurance policy or title insurance policy, including
all riders and endorsements thereto in effect, including any replacement
policy or policies for any Insurance Policies.
Insurance Proceeds: Proceeds of any primary mortgage guaranty insurance
policies and any other Insurance Policies with respect to the Mortgage Loans,
to the extent such proceeds are not applied to the restoration of the related
Mortgaged Property or released to the Mortgagor in accordance with the
Servicer's normal servicing procedures.
Insured Payments: As to any Distribution Date, amounts actually paid
under the FSA Policy.
Interest Determination Date: With respect to the LIBOR Certificates and
for each Accrual Period, the second LIBOR Business Day preceding the
commencement of such Accrual Period.
Interest Remittance Amount: For any Distribution Date, an amount equal to
the sum of (1) all interest collected (other than related Payaheads and Simple
Interest Excess, if applicable) or advanced in respect of Scheduled Payments
on the Mortgage Loans during the related Due Period, the interest portion of
Payaheads previously received and intended for application in the related Due
Period and the interest portion of all Payoffs and Curtailments received on
the Mortgage Loans during the related Prepayment Period, less (x) the
Servicing Fees and the Loss Mitigation Advisor Fee with respect to such
Mortgage Loans and (y) unreimbursed Advances
15
and other amounts due to the Servicer or Trustee with respect to such Mortgage
Loans, to the extent allocable to interest, (2) all Compensating Interest
Payments paid by the Servicer with respect to the Mortgage Loans with respect
to such Distribution Date, (3) the portion of any Substitution Adjustment
Amount or Repurchase Price paid with respect to such Mortgage Loans during the
calendar month immediately preceding the Distribution Date allocable to
interest, (4) all Net Liquidation Proceeds, and any Insurance Proceeds and
other recoveries (net of unreimbursed Advances, Servicing Advances and
expenses, to the extent allocable to interest, and unpaid Servicing Fees)
collected with respect to the Mortgage Loans during the prior calendar month,
to the extent allocable to interest and (5) any amounts withdrawn from the
Simple Interest Excess Sub-Account and the Capitalized Interest Account, in
either case to pay interest on the Certificates with respect to such
Distribution Date. If on any Determination Date the amount deposited into the
Collection Account with respect to Compensating Interest is the amount
calculated in clause (ii) of the definition of Compensating Interest Payment
for such Distribution Date, any remaining Servicing Fee shall be available to
cover any Net Simple Interest Shortfalls remaining on such Distribution Date,
after giving effect to the withdrawal from the Simple Interest Excess
Sub-Account pursuant to Section 3.07(g) on such Determination Date.
Interest Shortfall: For any Distribution Date, an amount equal to the
aggregate shortfall, if any, in collections of interest (adjusted to the
related Net Mortgage Rate) on Mortgage Loans resulting from (a) Prepayment
Interest Shortfalls to the extent not covered by a Compensating Interest
Payment and (b) interest payments on certain of the Mortgage Loans being
limited pursuant to the provisions of the Soldiers' and Sailors' Civil Relief
Act of 1940.
Late Payment Rate: means the lesser of (a) the greater of (i) the per
annum rate of interest, publicly announced from time to time by U.S. Bank
National Association at its principal office in Saint Xxxx, Minnesota, as its
prime or base lending rate (any change in such rate of interest to be
effective on the date such change is announced by U.S. Bank National
Association) plus 3%, and (ii) the then applicable highest rate of interest on
the Class A-2 Certificates and (b) the maximum rate permissible under
applicable usury or similar laws limiting interest rates. The Late Payment
Rate shall be computed on the basis of the actual number of days elapsed over
a year of 360 days.
LIBOR Business Day: Any day other than (i) a Saturday or a Sunday or (ii)
a day on which banking institutions in the States of New York or Minnesota or
in the city of London, England are required or authorized by law to be closed.
LIBOR Certificates: As defined in the Preliminary Statement.
Liquidation Mortgage Loan: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) which was liquidated in
the calendar month preceding the month of such Distribution Date and as to
which the Servicer has determined (in accordance with this Agreement) that it
has received all amounts it expects to receive in connection with the
liquidation of such Mortgage Loan, including the final disposition of the
related REO Property (exclusive of any possibility of a deficiency judgment).
16
Liquidation Proceeds: Amounts, including Insurance Proceeds, received in
connection with the partial or complete liquidation of defaulted Mortgage
Loans, whether through trustee's sale, foreclosure sale or otherwise or
amounts received in connection with any condemnation or partial release of a
Mortgaged Property and any other proceeds received in connection with an REO
Property.
Loan-to-Value Ratio: With respect to any Mortgage Loan and as to any date
of determination, the fraction (expressed as a percentage) the numerator of
which is the sum of the principal balance of the related Mortgage Loan at such
date of determination, and the denominator of which is (a) in the case of a
purchase, the lesser of the selling price of the related Mortgaged Property
and the Appraised Value of the related Mortgaged Property, or (b) in the case
of a refinance, the amount set forth in an appraisal made in connection with
the refinancing of the related Mortgaged Loan as the value of the related
Mortgaged Property.
Loss Mitigation Advisor: The Murrayhill Company, a Colorado corporation,
and any successor.
Loss Mitigation Advisory Agreement. The agreement between the Servicer
and the Loss Mitigation Advisor dated as of May 24, 2001.
Loss Mitigation Advisor Fee: The fee payable to the Loss Mitigation
Advisor on each Distribution Date for its services as Loss Mitigation Advisor,
in an amount equal to one-twelfth of the Loss Mitigation Advisor Fee Rate
multiplied by the Stated Principal Balance of the Mortgage Loans immediately
prior to such Distribution Date.
Loss Mitigation Advisor Fee Rate: 0.015% per annum.
Lost Mortgage Note: Any Mortgage Note the original of which was
permanently lost or destroyed and has not been replaced.
M-1 Principal Payment Amount: For any Distribution Date on or after the
Stepdown Date and as long as a Trigger Event has not occurred with respect to
such Distribution Date, will be the amount, if any, by which (x) the sum of
(i) the aggregate Class Principal Balance of the Senior Certificates after
giving effect to payments on such Distribution Date and (ii) the Class
Principal Balance of the Class M-1 Certificates immediately prior to such
Distribution Date exceeds (y) the lesser of (A) the product of (i) 86.00% and
(ii) the Aggregate Collateral Balance for such Distribution Date and (B) the
amount, if any, by which (i) the Aggregate Collateral Balance for such
Distribution Date exceeds (ii) 0.50% of the Aggregate Collateral Balance as of
the Cut-off Date.
M-2 Principal Payment Amount: For any Distribution Date on or after the
Stepdown Date and as long as a Trigger Event has not occurred with respect to
such Distribution Date, will be the amount, if any, by which (x) the sum of
(i) the aggregate Class Principal Balances of the Senior Certificates and the
Class Principal Balance of the Class M-1 Certificates, in each case, after
giving effect to payments on such Distribution Date and (ii) the Class
Principal Balance of the Class M-2 Certificates immediately prior to such
Distribution Date exceeds (y) the lesser of (A) the product of (i) 93.00% and
(ii) the Aggregate Collateral Balance for such Distribution
17
Date and (B) the amount, if any, by which (i) the Aggregate Collateral Balance
for such Distribution Date exceeds (ii) 0.50% of the Aggregate Collateral
Balance as of the Cut-off Date.
MGIC: Mortgage Guaranty Insurance Corporation.
MGIC Fee: As to each MGIC Mortgage Loan and any Distribution Date, an
amount equal to one month's interest at the MGIC Fee Rate on the Stated
Principal Balance of such MGIC Mortgage Loan as of the Due Date in the month
of such Distribution Date (prior to giving effect to any Scheduled Payments
due on such MGIC Mortgage Loan on such Due Date).
MGIC Fee Rate: With respect to each MGIC Mortgage Loan, the per annum
rate equal to 1.23%.
MGIC Mortgage Loan: Those Mortgage Loans identified on the Mortgage Loan
Schedule as to which the MGIC Policy provides coverage.
MGIC Policy: The mortgage guaranty insurance policy issued by MGIC,
attached hereto as Exhibit O.
MGIC Premium: For any Distribution Date, the aggregate MGIC Fees for such
Distribution Date.
Majority in Interest: As to any Class of Regular Certificates, the
Holders of Certificates of such Class evidencing, in the aggregate, at least
51 % of the Percentage Interests evidenced by all Certificates of such Class.
Master REMIC: As specified in the Preliminary Statement.
Maximum Interest Rate: For the LIBOR Certificates and any Distribution
Date, an annual rate equal to the weighted average of the Maximum Mortgage
Rates, minus the weighted average Expense Fee rate for such mortgage loans.
Maximum Mortgage Rate: With respect to each Mortgage Loan having an
adjustable-rate Mortgage Rate, the percentage set forth in the related
Mortgage Note as the maximum Mortgage Rate thereunder.
Minimum Mortgage Rate: With respect to each Mortgage Loan having an
adjustable-rate Mortgage Rate, the percentage set forth in the related
Mortgage Note as the minimum Mortgage Rate thereunder.
Monthly Excess Cashflow: For any Distribution Date, an amount equal to
the sum of the Monthly Excess Interest and Overcollateralization Release
Amount, if any, for such date.
Monthly Excess Interest: As to any Distribution Date, the Interest
Remittance Amount remaining after the application of payments pursuant to
clauses A through H of Section 4.02(a) and the Principal Payment Amount
remaining after the application of payments pursuant to clauses A. through E.
of Section 4.02(b) or 4.02(c), as applicable.
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Monthly Statement: The statement delivered to the Certificateholders
pursuant to Section 4.04.
Moody's: Xxxxx'x Investors Service, Inc., or any successor thereto. For
purposes of Section 10.05(b) the address for notices to Moody's shall be
Xxxxx'x Investors Service, Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Residential Pass-Through Monitoring, or such other address as
Moody's may hereafter furnish to the Depositor, the Servicer and the Trustee.
Mortgage: The mortgage, deed of trust or other instrument creating a
first lien on an estate in fee simple or leasehold interest in real property
securing a Mortgage Note.
Mortgage File: The Mortgage documents listed in Section 2.01(b) hereof
pertaining to a particular Mortgage Loan and any additional documents
delivered to the Trustee or its Custodian to be added to the Mortgage File
pursuant to this Agreement.
Mortgage Loans: Such 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.
Such mortgage loans include conventional, adjustable-rate and fixed-rate,
fully amortizing and balloon, first lien residential mortgage loans, all of
which have original terms to stated maturity of up to 30 years.
Mortgage Loan Schedule: The list of Mortgage Loans (as from time to time
amended by the Seller to reflect the addition of Qualified Substitute Mortgage
Loans and the purchase of Mortgage Loans pursuant to Section 2.02 or 2.03)
transferred to the Trustee as part of the Trust Fund and from time to time
subject to this Agreement, attached hereto as Schedule I, setting forth the
following information with respect to each Mortgage Loan:
(i) the Mortgage Loan identifying number;
(ii) the Mortgagor's name;
(iii) the street address of the Mortgaged Property including the
state and zip code;
(iv) a code indicating the type of Mortgaged Property and the
occupancy status;
(v) the original months to maturity;
(vi) a code indicating the Loan-to-Value Ratio at origination;
(vii) the Mortgage Rate as of the Cut-off Date;
(viii) the stated maturity date;
19
(ix) the amount of the Scheduled Payment as of the Cut-off Date;
(x) the original principal amount of the Mortgage Loan;
(xi) the principal balance of the Mortgage Loan as of the close of
business on the Cut-off Date, after deduction of payments of principal
due on or before the Cut-off Date whether or not collected;
(xii) a code indicating whether the Mortgage Loan is a MGIC Mortgage
Loan;
(xiii) the purpose of the Mortgage Loan (i.e., purchase, rate and
term refinance, equity take-out refinance);
(xiv) a code indicating whether a Prepayment Premium is required to
be paid in connection with a prepayment of the Mortgage Loan and the
amount of the Prepayment Premium;
(xv) an indication whether the Mortgage Loan accrues interest at an
adjustable Mortgage Rate or a fixed Mortgage Rate and whether such
Mortgage Loan is a Simple Interest Mortgage Loan;
(xvi) the Index that is associated with such Mortgage Loan, if
applicable;
(xvii) the Gross Margin, if applicable;
(xviii) the Periodic Rate Cap, if applicable;
(xix) the Minimum Mortgage Rate, if applicable;
(xx) the Maximum Mortgage Rate, if applicable; and
(xxi) the first Adjustment Date after the Cut-off Date, if
applicable.
With respect to the Mortgage Loans in the aggregate, each Mortgage Loan
Schedule shall set forth the following information, as of the Cut-off Date:
(i) the number of Mortgage Loans;
(ii) the current aggregate principal balance of the Mortgage
Loans as of the close of business on the Cut-off Date, after deduction of
payments of principal due on or before the Cut-off Date whether or not
collected;
(iii) the weighted average Mortgage Rate of the Mortgage Loans; and
(iv) a field indicating the applicable Custodian as of the Closing
Date.
Mortgage Note: The original executed note or other evidence of
indebtedness evidencing the indebtedness of a Mortgagor under a Mortgage Loan.
20
Mortgage Pool: All of the Mortgage Loans.
Mortgage Rate: The annual rate of interest borne by a Mortgage Note.
Mortgaged Property: The underlying real property securing a Mortgage
Loan.
Mortgagor: The obligor(s) on a Mortgage Note.
Net Excess Spread: With respect to any Distribution Date, a fraction,
expressed as a percentage, the numerator of which is equal to the excess of
(x) the aggregate Stated Principal Balance for such Distribution Date of the
Mortgage Loans, multiplied by the product of (a) the Net WAC Rate and (b) the
actual number of days elapsed in the related Accrual Period divided by 360,
over (y) the aggregate Current Interest for such Distribution Date, and the
denominator of which is an amount equal to the Aggregate Balance for such
Distribution Date of the Mortgage Loans, multiplied by the actual number of
days elapsed in the related Accrual Period divided by 360.
Net Funds Cap: As to any Distribution Date, will be a per annum rate
equal to (a) a fraction, expressed as a percentage, (i) the numerator of which
is the excess of (A) the Net WAC Rate (less the Premium Percentage),
multiplied by the applicable Aggregate Collateral Balance for the immediately
preceding Distribution Date, over (B) any expenses that reduce the Interest
Remittance Amount that do not arise as a result of a default or delinquency of
the Mortgage Loans, and (ii) the denominator of which is the applicable
Aggregate Collateral Balance immediately preceding such Distribution Date,
multiplied by (b) a fraction, the numerator of which is 30 and the denominator
of which is the actual number of days in the related Accrual Period.
Net Liquidation Proceeds: Liquidation Proceeds, net of (1) unreimbursed,
reasonable out-of-pocket expenses and (2) unreimbursed Servicing Fees,
Servicing Advances and Advances.
Net Mortgage Rate: As to each Mortgage Loan, and at any time, the per
annum rate equal to the Mortgage Rate less the related Expense Fee Rate.
Net Simple Interest Excess: As of any Distribution Date, the excess, if
any, of the aggregate amount of Simple Interest Excess over the amount of
Simple Interest Shortfall.
Net Simple Interest Shortfall: As of any Distribution Date, the excess,
if any, of the aggregate amount of Simple Interest Shortfall over the amount
of Simple Interest Excess.
Net WAC Rate: As to any Distribution Date, a rate equal to the weighted
average of the Net Mortgage Rates on the Mortgage Loans for the related Due
Period, weighted on the basis of the Stated Principal Balances as of the first
day of the related Due Period.
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
Servicer that, in the good faith judgment of the Servicer, will not be
ultimately recoverable by the Servicer from the related Mortgagor, related
Liquidation Proceeds or otherwise.
21
Notional Amount Certificates: As specified in the Preliminary Statement.
Offered Certificates: As specified in the Preliminary Statement.
Officer's Certificate: A certificate signed by the Chairman of the Board
or the Vice Chairman of the Board or the President or a Vice President or an
Assistant Vice President or the Treasurer or the Secretary or one of the
Assistant Treasurers or Assistant Secretaries of the Servicer or any
certificate of any Servicing Officer, and delivered to the Depositor or the
Trustee, as the case may be, as required by this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be counsel for
the Depositor or the Servicer, including in-house counsel, reasonably
acceptable to the Trustee; provided, however, that with respect to the
interpretation or application of the REMIC Provisions, such counsel must (i)
in fact be independent of the Depositor and the Servicer, (ii) not have any
material direct financial interest in the Depositor or the Servicer or in any
affiliate of either, and (iii) not be connected with the Depositor or the
Servicer as an officer, employee, promoter, underwriter, trustee, partner,
director or person performing similar functions. The cost of any Opinion of
Counsel, except as otherwise specifically provided herein, shall not be at the
expense of the Trustee.
Optional Termination Date: The first Distribution Date on which Vesta may
exercise its right to terminate the Trust Fund pursuant to Section 9.01.
OTS: The Office of Thrift Supervision.
Outsourcer: As defined in Section 3.02.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore executed and authenticated under
this Agreement except:
(i) Certificates theretofore canceled by the Trustee or delivered
to the Trustee for cancellation; and
(ii) Certificates in exchange for which or in lieu of which other
Certificates have been executed and delivered by the Trustee pursuant to
this Agreement.
Outstanding Mortgage Loan: As of any Due Date, a Mortgage Loan with a
Stated Principal Balance greater than zero which was not the subject of a
Payoff prior to such Due Date and which did not become a Liquidation Mortgage
Loan prior to such Due Date.
Overcollateralization Amount: For any Distribution Date, an amount equal
to the amount, if any, by which (x) the applicable Aggregate Collateral
Balance for such Distribution Date exceeds (y) the aggregate Class Principal
Balance of the Offered Certificates after giving effect to payments on such
Distribution Date.
Overcollateralization Deficiency: For any distribution date will be equal
to 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
22
giving effect to the reduction on such distribution date of the aggregate
Class Principal Balance of the Certificates resulting from the payment of the
Principal Payment Amount on such Distribution Date, but prior to allocation of
any Applied Loss Amount on such Distribution Date.
Overcollateralization Release Amount: For any Distribution Date, an
amount equal to the lesser of (x) the related Principal Remittance Amount for
such Distribution Date and (y) the amount, if any, by which (1) the
Overcollateralization Amount for such date, calculated for this purpose on the
basis of the assumption that 100% of the aggregate of the related Principal
Remittance Amount for such date is applied on such date in reduction of the
aggregate of the Class Principal Balances of the Certificates, exceeds (2) the
related Targeted Overcollateralization Amount for such date.
Overfunded Interest Amount: With respect to the September 2001 and
October 2001 Distribution Dates, the excess of (A) the amount on deposit in
the Capitalized Interest Account on such date over (B) the excess of (i) the
amount of interest accruing at the sum of the (a) assumed weighted average
Pass-Through Rates of the Offered Certificates and (b) 3.98% Percentage on the
Pre-Funded Amount outstanding at the end of the related Due Period for the
total number of days remaining through the end of the Accrual Period ending on
November 21, 2001 over (ii) one month of investment earnings on the amount on
deposit in the Capitalized Interest Account on such date at an annual rate of
2.50%. The assumed weighted average Pass-Through Rate will be calculated
assuming the Certificate Index is 3.83% for the October 2001 Distribution Date
and 4.08% for the November 2001 Distribution Date.
Ownership Interest: As to any Residual Certificate, any ownership or
security 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: With respect to the any Class of LIBOR Certificates
and any Distribution Date, a per annum rate equal to the lesser of (x) the
related Certificate Index for such Distribution Date, plus the related margin,
and (y) the related Net Funds Cap for such Distribution Date. With respect to
the Class A-IO and any Distribution Date, a per annum rate equal to the lesser
of (a) the excess, if any, of 8.00% over the Certificate Index for such
Distribution Date and (b) the excess, if any, of the Net Funds Cap (for
purposes of this calculation, the denominator shall not be multiplied by
subclause (b) in the definition thereof) over the weighted average of the
Class A-1 and Class A-2 Certificates for such Distribution Date (calculated as
if such Classes accrued interest on the basis of a 360 day year of twelve 30
day months). With respect to the Class X Certificates, the rate set forth in
the Preliminary Statement.
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.
Payoff: Any payment of principal on a Mortgage Loan equal to the entire
outstanding principal balance of such Mortgage Loan, if received in advance of
the last scheduled Due Date for such Mortgage Loan and accompanied by an
amount of interest equal to accrued unpaid interest on the Mortgage Loan to
the date of such payment-in-full.
23
Percentage Interest: As to any Certificate, either the percentage set
forth on the face thereof or equal to the percentage obtained by dividing the
Denomination of such Certificate by the aggregate of the Denominations of all
Certificates of the same Class.
Permitted Transferee: Any person other than a Disqualified Organization
or a Person that is not a citizen or resident of the United States, a
corporation, partnership, or other entity (treated as a corporation or
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,
or an estate whose income from sources without the United States is includible
in gross income for 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 the
authority to control all substantial decisions of the trust unless such Person
has furnished the transferor and the Trustee with a duly completed Internal
Revenue Service Form W-8ECI. The terms "United States" and "State" shall have
the meanings set forth in section 7701 of the Code or successor provisions.
Person: Any individual, corporation, partnership, joint venture,
association, limited liability company, joint-stock company, trust,
unincorporated organization or government, or any agency or political
subdivision thereof.
Physical Certificates: As specified in the Preliminary Statement.
Preference Claim: As defined in Section 4.07(h).
Pre-Funded Amount: The amount deposited in the Prefunding Account on the
Closing Date, which shall equal $27,382,075.
Prefunding Account: The separate Eligible Account created and maintained
by the Trustee pursuant to Section 3.06 in the name of the Trustee for the
benefit of the Certificateholders and designated "U.S. Bank National
Association, in trust for registered holders of CSFB Mortgage Pass-Through
Certificates, CSFB ABS Trust Series 2001-HE17" Funds in the Prefunding Account
shall be held in trust for the Certificateholders for the uses and purposes
set forth in this Agreement and shall not be a part of any REMIC created
hereunder; provided, however, that any investment income earned from Permitted
Investments made with funds in the Prefunding Account shall be for the account
of the Depositor.
Prefunding Period: The period from the Closing Date until the earlier of
(i) the date on which the amount on deposit in the Prefunding Account is
reduced to zero, or (ii) an Event of Default occurs or (iii) November 21,
2001.
Prepayment Interest Shortfall: As to any Distribution Date, Mortgage Loan
and Principal Prepayment, other than Principal Prepayments in full that occur
during the portion of the Prepayment Period that is in the same calendar month
as the Distribution Date, the difference between (i) one full month's interest
at the applicable Mortgage Rate, as reduced by the Servicing Fee Rate on the
outstanding principal balance of such Mortgage Loan immediately prior to such
prepayment and (ii) the amount of interest due and actually received from the
related Mortgagor that accrued during the month immediately preceding such
Distribution Date
24
with respect to such Mortgage Loan in connection with such Principal
Prepayment, as reduced by the Servicing Fee.
Prepayment Premium: With respect to each Mortgage Loan, the prepayment
charge or penalty interest required to be paid by the Mortgagor in connection
with a prepayment of the related Mortgage Loan, as provided in the related
Mortgage Note or Mortgage, and as specified on the Mortgage Loan Schedule.
Prepayment Period: With respect to any Distribution Date and any Payoff,
the period from the fifteenth day of the calendar month preceding the month in
which such Distribution Date occurs (or in the case of the first distribution
date, from the Cut-Off Date) through the fourteenth day of the month in which
such Distribution Date occurs. With respect to any Distribution Date and any
Curtailment, the calendar month preceding such Distribution Date.
Premium Percentage: 0.06%.
Primary Insurance Policy: Each policy of primary mortgage guaranty
insurance or any replacement policy therefor with respect to any Mortgage
Loan.
Principal Payment Amount: For any Distribution Date, an amount equal to
the related Principal Remittance Amount for such date minus the related
Overcollateralization Release Amount, if any, for such date.
Principal Prepayment: Any payment of principal on a Mortgage Loan which
constitutes a Payoff or Curtailment.
Principal Remittance Amount: For any Distribution Date, an amount equal
to the sum of (1) all principal collected (other than Payaheads) or advanced
in respect of Scheduled Payments on the Mortgage Loans during the related Due
Period (less unreimbursed Advances, Servicing Advances and other amounts due
to the Servicer and the Trustee with respect to such Mortgage Loans, to the
extent allocable to principal) and the principal portion of Payaheads
previously received and intended for application in the related Due Period,
(2) all Principal Prepayments on the Mortgage Loans received during the
related Prepayment Period, (3) the outstanding principal balance of each
Mortgage Loan that was repurchased by the Seller or the Servicer during the
calendar month immediately preceding such Distribution Date, (4) the portion
of any Substitution Adjustment Amount paid with respect to any Deleted
Mortgage Loans during the calendar month immediately preceding such
Distribution Date allocable to principal, (5) all Net Liquidation Proceeds and
other recoveries (net of unreimbursed Advances, Servicing Advances and other
expenses, to the extent allocable to principal) collected with respect to the
Mortgage Loans during the prior calendar month, to the extent allocable to
principal, and (6) with respect to the November 2001 Distribution Date, any
amounts remaining in the Prefunding Account (other than investment earnings
thereon).
Private Certificates: As specified in the Preliminary Statement.
Prospectus Supplement: The Prospectus Supplement dated August 21, 2001
relating to the Offered Certificates.
25
PUD: Planned Unit Development.
Qualified Insurer: A mortgage guaranty insurance company duly qualified
as such under the laws of the state of its principal place of business and
each state having jurisdiction over such insurer in connection with the
insurance policy issued by such insurer, duly authorized and licensed in such
states to transact a mortgage guaranty insurance business in such states and
to write the insurance provided by the insurance policy issued by it, approved
as a FNMA- or FHLMC-approved mortgage insurer or having a claims paying
ability rating of at least "AA" or equivalent rating by a nationally
recognized statistical rating organization. Any replacement insurer with
respect to a Mortgage Loan must have at least as high a claims paying ability
rating as the insurer it replaces had on the Closing Date.
Qualified Substitute Mortgage Loan: A Mortgage Loan substituted by the
Seller for a Deleted Mortgage Loan which must, on the date of such
substitution, as confirmed in a Request for Release, substantially in the form
of Exhibit M (i) have a Stated Principal Balance, after deduction of the
principal portion of the Scheduled Payment due in the month of substitution
(or, in the case of a substitution of more than one mortgage loan for a
Deleted Mortgage Loan, an aggregate Stated Principal Balance), not in excess
of, and not more than 10% less than the Stated Principal Balance of the
Deleted Mortgage Loan; (ii) be accruing interest at a rate no lower than and
not more than 1% per annum higher than, that of the Deleted Mortgage Loan;
(iii) have a Loan-to-Value Ratio no higher than that of the Deleted Mortgage
Loan; (iv) have a remaining term to maturity no greater than (and not more
than one year less than that of) the Deleted Mortgage Loan; (v) if the Deleted
Mortgage Loan is an adjustable-rate first lien Mortgage Loan have a Maximum
Mortgage Rate and Minimum Mortgage Rate not less than the respective rates for
the Deleted Mortgage Loan, have a Gross Margin equal to or greater than the
Deleted Mortgage Loan and have the same Index as the Deleted Mortgage Loan and
(vi) comply with each representation and warranty set forth in Section
2.03(b).
Rating Agency: Each of the Rating Agencies specified in the Preliminary
Statement. If any such organization or a successor is no longer in existence,
"Rating Agency" shall be such nationally recognized statistical rating
organization, or other comparable Person, as is designated by the Depositor,
notice of which designation shall be given to the Trustee and the Servicer.
References herein to a given rating or rating category of a Rating Agency
shall mean such rating category without giving effect to any modifiers.
Ratings: As of any date of determination, the ratings, if any, of the
Certificates as assigned by the Rating Agencies.
Realized Loss: With respect to each Liquidation Mortgage Loan, an amount
(not less than zero or more than the Stated Principal Balance of the Mortgage
Loan) as of the date of such liquidation, equal to (i) the Stated Principal
Balance of the Liquidation Mortgage Loan as of the date of such liquidation,
plus (ii) interest at the Net Mortgage Rate from the related Due Date as to
which interest was last paid or advanced (and not reimbursed) to
Certificateholders up to the related Due Date in the month in which
Liquidation Proceeds are required to be distributed on the Stated Principal
Balance of such Liquidation Mortgage Loan from time to time, minus (iii) the
Net Liquidation Proceeds, if any, received during the month in which such
liquidation
26
occurred, to the extent applied as recoveries of interest at the Net Mortgage
Rate and to principal of the Liquidation Mortgage Loan.
Record Date: With respect to any Class of Physical Certificates and any
Distribution Date, the last day of the calendar month preceding the month in
which such Distribution Date occurs. With respect to any Class of Certificates
that is not a Physical Certificate and any Distribution Date, the Business Day
immediately preceding such Distribution Date; provided, however, that
following the date on which Definitive Certificates for such Certificates are
available pursuant to Section 5.02, the Record Date shall be the last day of
the calendar month preceding the month in which such Distribution Date occurs.
Reference Bank Rate: As to any Accrual Period relating to the LIBOR
Certificates as follows: the arithmetic mean (rounded upwards, if necessary,
to the nearest one sixteenth of a percent) of the offered rates for United
States dollar deposits for one month which are offered by the Reference Banks
as of 11:00 a.m., London time, on the Interest Determination Date prior to the
first day of such Accrual Period to prime banks in the London interbank market
for a period of one month in amounts approximately equal to the aggregate
Class Principal Balance of the LIBOR Certificates; 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 of the rates
quoted by one or more major banks in New York City, selected by the Trustee,
as of 11:00 a.m., New York City time, on such date for loans in U.S. Dollars
to leading European banks for a period of one month in amounts approximately
equal to the aggregate Class Principal Balance of the LIBOR Certificates. If
no such quotations can be obtained, the Reference Bank Rate shall be the
Reference Bank Rate applicable to the preceding Accrual Period.
Reference Banks: Three major banks that are engaged in the London
interbank market, selected by the Trustee, as identified in writing to the
Trustee.
Regular Certificates: As specified in the Preliminary Statement.
Relief Act: The Soldiers' and Sailors' Civil Relief Act of 1940, as
amended.
REMIC: A "real estate mortgage investment conduit" within the meaning of
Section 860D of the Code.
REMIC Provisions: Provisions of the federal income tax law relating to
real estate mortgage investment conduits, which appear at sections 860A
through 860G of Subchapter M of Chapter 1 of the Code, and related provisions,
and regulations promulgated thereunder, as the foregoing may be in effect from
time to time.
REO Property: A Mortgaged Property acquired by the Trust Fund through
foreclosure or deed-in-lieu of foreclosure in connection with a defaulted
Mortgage Loan.
Repurchase Price: With respect to any Mortgage Loan required to be
purchased by the Seller pursuant to this Agreement or purchased at the option
of Vesta pursuant to this Agreement, an amount equal to the sum of (i) 100% of
the unpaid principal balance of the Mortgage Loan on the date of such
purchase, and (ii) accrued and unpaid interest thereon at the applicable
Mortgage Rate (reduced by the Servicing Fee Rate if the purchaser of the
Mortgage
27
Loan is also the Servicer thereof) from the date through which interest was
last paid by the Mortgagor to the Due Date in the month in which the
Repurchase Price is to be distributed to Certificateholders.
Request for Release: The Request for Release submitted by the Servicer to
the Custodian substantially in the form of Exhibit M.
Required Basis Risk Reserve Fund Amount: With respect to any Distribution
Date on which the Net Excess Spread is less than 0.25%, the greater of (a)
$15,000 and (b) the product of 0.50% and the Aggregate Loan Balance. With
respect to any Distribution Date on which the Net Excess Spread is equal to or
greater than 0.25%, $5,000.
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: As specified in the Preliminary Statement.
Responsible Officer: When used with respect to the Trustee, any Vice
President, any Assistant Vice President, any Assistant Secretary, any Trust
Officer or any other officer or employee of the Trustee 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 or employee's knowledge of and familiarity with the
particular subject and in each case who shall have direct responsibility for
the administration of this Agreement.
Rolling Three Month Delinquency Rate: For any Distribution Date will be
the fraction, expressed as a percentage, equal to the average of the related
Delinquency Rates for each of the three (or one and two, in the case of the
first and second Distribution Dates) immediately preceding months.
S&P: Standard & Poor's Ratings Services, a division of The XxXxxx-Xxxx
Companies, Inc. For purposes of Section 10.05(b) the address for notices to
S&P shall be Standard & Poor's, 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Mortgage Surveillance Monitoring, or such other address as S&P may
hereafter furnish to the Depositor, the Servicer and the Trustee.
SAIF: The Savings Association Insurance Fund, or any successor thereto.
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
pursuant to the terms of the related Mortgage Note.
Securities Act: The Securities Act of 1933, as amended.
Seller: DLJMC.
Senior Certificates: As specified in the Preliminary Statement.
28
Senior Enhancement Percentage: For any Distribution Date, the fraction,
expressed as a percentage, the numerator of which is the sum of the aggregate
Class Principal Balance of the Subordinate Certificates and the
Overcollateralization Amount (which, for purposes of this definition only,
shall not be less than zero), in each case after giving effect to payments on
such Distribution Date (assuming no Trigger Event has occurred), and the
denominator of which is the Aggregate Collateral Balance for such Distribution
Date.
Senior Principal Payment Amount: For any Distribution Date on or after
the Stepdown Date and as long as a Trigger Event has not occurred with respect
to such Distribution Date, will be the amount, if any, by which (x) the Class
Principal Balance of the Senior Certificates immediately prior to such
Distribution Date exceeds (y) the lesser of (A) the product of (i) 78.00% and
(ii) the Aggregate Collateral Balance for such Distribution Date and (B) the
amount, if any, by which (i) the Aggregate Collateral Balance for such
Distribution Date exceeds (ii) 0.50% of the Aggregate Collateral Balance as of
the Cut-off Date.
Servicer: Vesta, or its successors in interest, as applicable.
Servicer Employee: As defined in Section 3.19.
Servicer Remittance Date: With respect to any Mortgage Loan and
Distribution Date, two Business Days prior to such Distribution Date.
Servicing Advance: All reasonable and customary "out of pocket" costs and
expenses incurred in the performance by the Servicer of its servicing
obligations, including, but not limited to, the cost (including reasonable
attorneys' fees and disbursements) of (i) the preservation, restoration and
protection of a Mortgaged Property, (ii) any enforcement or judicial
proceedings, including foreclosures and any litigation related to a Mortgage
Loan, (iii) the management and liquidation of any REO Property including
reasonable fees paid to any independent contractor in connection therewith,
(iv) compliance with the obligations under Section 3.10 or 3.12 and (v) in
connection with the liquidation of a Mortgage Loan, expenditures relating to
the purchase or maintenance of a first lien Mortgage Loan, all of which
reasonable and customary out-of-pocket costs and expenses are reimbursable to
the Servicer to the extent provided in Sections 3.07(d)(ii) and 3.09(ii),
(iii), (iv) and (vi).
Servicing Fee: As to each Mortgage Loan and any Distribution Date, an
amount equal to one month's interest at the Servicing Fee Rate on the Stated
Principal Balance of such Mortgage Loan as of the Due Date in the month of
such Distribution Date (prior to giving effect to any Scheduled Payments due
on such Mortgage Loan on such Due Date), subject to reduction as provided in
Section 3.15.
Servicing Fee Rate: With respect to any Mortgage Loan, 0.50% per annum.
Servicing Officer: With respect to the Servicer, any officer of that
Servicer involved in, or responsible for, the administration and servicing of
the related Mortgage Loans whose name and specimen signature appear on a list
of servicing officers furnished to the Trustee by the Servicer on the Closing
Date pursuant to this Agreement, as such list may from time to time be amended
and delivered to the Trustee.
29
Simple Interest Excess: As of any Distribution Date for each Simple
Interest Qualifying Loan, the excess, if any, of (i) the portion of the
monthly payment received from the Mortgagor for such Mortgage Loan allocable
to interest with respect to the related Due Period, over (ii) 30 days'
interest on the Stated Principal Balance of such Mortgage Loan at the Mortgage
Rate.
Simple Interest Excess Sub-Account: The sub-account of the Collection
Account established by the Servicer pursuant to Section 3.07(f). The Simple
Interest Excess Sub-Account shall be an Eligible Account.
Simple Interest Mortgage Loan: Any Mortgage Loan for which the interest
due thereon is calculated based on the actual number of days elapsed between
the date on which interest was last paid through the date on which the most
current payment is received.
Simple Interest Qualifying Loan: As of any Determination Date, any Simple
Interest Mortgage Loan that was neither prepaid in full during the related Due
Period, nor delinquent with respect to a payment that became due during the
related Due Period as of the close of business on the Determination Date
following such Due Period.
Simple Interest Shortfall: As of any Distribution Date for each Simple
Interest Qualifying Loan, the excess, if any, of (i) 30 days' interest on the
Stated Principal Balance of all such Mortgage Loans at the Mortgage Rate, over
(ii) the portion of the monthly payment received from the Mortgagor for such
Mortgage Loan allocable to interest with respect to the related Due Period.
Special Serviced Mortgage Loans: Mortgage Loans for which the Special
Servicer acts as Servicer pursuant to Section 3.03.
Special Servicer: Vesta, or its successors in interest, as applicable.
Startup Day: The Closing Date.
Stated Principal Balance: As to any Mortgage Loan and Due Date, the
unpaid principal balance of such Mortgage Loan as of such Due Date as
specified in the amortization schedule at the time relating thereto (before
any adjustment to such amortization schedule by reason of any moratorium or
similar waiver or grace period) after giving effect to any previous
Curtailments and Liquidation Proceeds allocable to principal (other than with
respect to any Liquidation Mortgage Loan) and to the payment of principal due
on such Due Date and irrespective of any delinquency in payment by the related
Mortgagor.
Stepdown Date: The date occurring on the later of (x) the Distribution
Date in September 2004 and (y) the first Distribution Date on which the Senior
Enhancement Percentage (calculated for this purpose after giving effect to
payments or other recoveries in respect of the Mortgage Loans during the
related Due Period but before giving effect to payments on the Certificates on
such Distribution Date) is greater than or equal to 22.00%.
Subordinate Certificates: As specified in the Preliminary Statement.
30
Subsequent Cut-off Date: With respect to any Subsequent Mortgage Loan,
the date of which such Mortgage Loan is transferred to the Trust.
Subsequent Mortgage Loan: Any Mortgage Loan other than an Initial
Mortgage Loan conveyed to the Trust Fund pursuant to Section 2.01 hereof and
to a Subsequent Transfer Agreement, which Mortgage Loan shall be listed on the
revised Mortgage Loan Schedule delivered pursuant to this Agreement and on
Schedule A to such Subsequent Transfer Agreement. When used with respect to a
single Subsequent Transfer Date, Subsequent Mortgage Loan shall mean a
Subsequent Mortgage Loan conveyed to the Trust on that Subsequent Transfer
Date.
Subsequent Transfer Agreement: A Subsequent Transfer Agreement
substantially in the form of Exhibit N hereto, executed and delivered by the
Depositor, DLJMC, the Servicer and the Trustee as provided in Section 2.01
hereof.
Subsequent Transfer Date: For any Subsequent Transfer Agreement, the date
the related Subsequent Mortgage Loans are transferred to the Trust pursuant to
the related Subsequent Transfer Agreement.
Subservicer: Any Subservicer which is subservicing any of the Mortgage
Loans pursuant to a Subservicing Agreement. Any subservicer shall meet the
qualifications set forth in Section 3.02.
Subservicing Agreement: An agreement between the Servicer and a
Subservicer for the servicing of the related Mortgage Loans.
Subsidiary REMIC: As specified in the Preliminary Statement.
Substitution Adjustment Amount: As defined in Section 2.03.
Targeted Overcollateralization Amount: For any Distribution Date prior to
the Stepdown Date, 1.00% of the Aggregate Collateral 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 has not occurred, the greater of (a)
2.00% of the Aggregate Collateral Balance for such Distribution Date, or (b)
0.50% of the Aggregate Collateral 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 has occurred and is continuing, the Targeted
Overcollateralization Amount for the Distribution Date immediately preceding
such Distribution Date.
Telerate Page 3750: The display designated as page 3750 on Bridge
Telerate Service (or such other page as may replace page 3750 on that service
for the purpose of displaying London interbank offered rates of major banks).
Transfer: Any direct or indirect transfer or sale of any Ownership
Interest in a Residual Certificate.
Transferee: Any Person who is acquiring by Transfer any Ownership
Interest in a Residual Certificate.
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Trigger Event: A Trigger Event will occur for any Distribution Date if
the related Rolling Three Month Delinquency Rate as of the last day of the
related Due Period equals or exceeds 70.00% of the Senior Enhancement
Percentage for such Distribution Date.
Trust: CSFB ABS Trust Series 2001-HE17 established pursuant to this
Agreement.
Trust Fund: The corpus of the trust created hereunder consisting of (i)
the Mortgage Loans and all interest and principal received on or with respect
thereto after the Cut-off Date, other than such amounts which were due on the
Mortgage Loans on or before the Cut-off Date; (ii) the Collection Accounts
(including any Simple-Interest Excess Sub-Account), the Certificate Account,
the Prefunding Account, Capitalized Interest Account and the Basis Risk
Reserve Fund and all amounts deposited therein pursuant to the applicable
provisions of this Agreement; (iii) property which secured a Mortgage Loan and
which has been acquired by foreclosure or deed in lieu of foreclosure after
the applicable Cut-off Date; (iv) the Depositor's rights under the Assignment
and Assumption Agreement; (v) the FSA Policy and the MGIC Policy, and (vi) all
proceeds of the conversion, voluntary or involuntary, of any of the foregoing.
Trustee: U.S. Bank National Association, in its capacity as trustee under
this agreement and assigns in such capacity.
Trustee Fee: The fee payable to the Trustee on each Distribution Date for
its services as Trustee hereunder, in an amount equal to one-twelfth of the
Trustee Fee Rate multiplied by the Stated Principal Balance of the Mortgage
Loans immediately prior to such Distribution Date.
Trustee Fee Rate: 0.475% per annum.
Underwriters' Exemption: Prohibited Transaction Exemption 2000-58, 65
Fed. Reg. 67765 (2000), as amended (or any successor thereto), or any
substantially similar administrative exemption granted by the U.S. Department
of Labor.
Vesta: Vesta Servicing L.P., a Delaware limited partnership, and its
successors and assigns.
Voting Rights: The portion of the voting rights of all the Certificates
that is allocated to any Certificate for purposes of the voting provisions of
this Agreement. At all times during the term of this Agreement, 98% of all
Voting Rights shall be allocated among the Class X-0, Xxxxx X-0, Class M-1,
Class M-2 and Class B Certificates. The portion of such 98% Voting Interests
allocated to the Class X-0, Xxxxx X-0, Class M-1, Class M-2 and Class B
Certificates shall be based on the fraction, expressed as a percentage, the
numerator of which is the aggregate Class Principal Balance then outstanding
and the denominator of which is the Class Principal Balance of all such
Classes then outstanding. The Class A-IO and the Class X Certificates shall
each be allocated 1% of the Voting Rights. Voting Rights shall be allocated
among the Certificates within each such Class (other than the Class X
Certificates, which each have only one certificate) in accordance with their
respective Percentage Interests. The Class R shall have no voting rights.
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SECTION 1.02 Interest Calculations.
Interest on the LIBOR Certificates shall be calculated on the basis of a
360-day year and the actual number of days elapsed. The calculation of all
fees and interest on the Class A-IO Certificates and the Class X Certificate
shall be made on the basis of a 360-day year consisting of twelve 30-day
months. All dollar amounts calculated hereunder shall be rounded to the
nearest xxxxx with one-half of one xxxxx being rounded down.
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ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
SECTION 2.01 Conveyance of Mortgage Loans.
(a) The Depositor, concurrently with the execution and delivery hereof,
hereby sells, transfers, assigns, sets over and otherwise conveys to the
Trustee in trust for the benefit of the Certificateholders, without recourse,
all the right, title and interest of the Depositor in and to (i) subject to
Section 6.04(b), each Initial Mortgage Loan, including all interest and
principal received or receivable on or with respect to such Initial Mortgage
Loans after the Initial Cut-off Date and all interest and principal payments
on the Initial Mortgage Loans received prior to the Initial Cut-off Date in
respect of installments of interest and principal due thereafter, but not
including payments of principal and interest due and payable on the Initial
Mortgage Loans on or before the Initial Cut-off Date; (ii) any insurance
policies in respect of the Initial Mortgage Loans; (iii) the Depositor's
rights under the Assignment and Assumption Agreement, (iv) any such amounts as
may be deposited into and held by the Trustee in the Prefunding Account and
Capitalized Interest Account and (v) all proceeds of any of the foregoing. In
addition, on or prior to the Closing Date, the Depositor shall cause MGIC and
FSA to deliver the MGIC Policy and the FSA Policy, respectively, to the
Trustee.
(b) In connection with the transfer and assignment set forth in clause
(a) above, the Depositor has delivered or caused to be delivered to the
Custodian for the benefit of the Certificateholders, the documents and
instruments with respect to each Mortgage Loan as assigned:
(i) the electronic Mortgage Loan Schedule;
(ii) (A) the original Mortgage Note bearing all intervening
endorsements and including any riders to the Mortgage Note, endorsed "Pay
to the order of __________, without recourse" and signed in the name of
the last named endorsee by an authorized officer, or
(B) with respect to any Lost Mortgage Note, a lost note
affidavit stating that the original Mortgage Note was lost or
destroyed, together with a copy of such Mortgage Note;
(iii) the original of any guarantee executed in connection with the
Mortgage Note (if any);
(iv) the original Mortgage, with evidence of recording thereon, or
copies certified by the related recording office or if the original
Mortgage has not yet been returned from the recording office, a copy
certified by or on behalf of the Seller indicating that such Mortgage has
been delivered for recording. The return directions for the original
Mortgage should indicate, when recorded, mail to the Seller;
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(v) the originals of all assumption, modification, consolidation or
extension agreements (or, if an original of any of these documents has
not been returned from the recording office, a copy thereof certified by
or on behalf of the Seller, the original to be delivered to the Seller
forthwith after return from such recording office) with evidence of
recording thereon, if any;
(vi) the original Assignment of Mortgage as appropriate, in
recordable form, for the Mortgage Loan assigned in blank;
(vii) the originals of any intervening recorded assignments of
mortgage, showing a complete chain of assignment from origination to the
last named assignee, including warehousing assignments, with evidence of
recording thereon (or, if an original intervening Assignment of Mortgage
has not been returned from the recording office, a copy thereof certified
by or on behalf of the Seller, the original to be delivered to the
Trustee forthwith after return from such recording office); and
(viii) the original mortgage title insurance policy.
If the Seller delivers certified copies of any document or instrument set
forth in Section 2.01(b) to the Custodian because of a delay caused by the
public recording office in returning any recorded document, the Seller shall
deliver to the Custodian, within 60 days of the Closing Date, an Officer's
Certificate which shall (i) identify the recorded document, (ii) state that
the recorded document has not been delivered to the Custodian due solely to a
delay caused by the public recording office, and (iii) state the amount of
time generally required by the applicable recording office to record and
return a document submitted for recordation.
In the event that in connection with any Mortgage Loan the Depositor
cannot deliver (a) the original recorded Mortgage, (b) all interim recorded
assignments or (c) the lender's title policy (together with all riders
thereto) satisfying the requirements set forth above, concurrently with the
execution and delivery hereof because such document or documents have not been
returned from the applicable public recording office in the case of clause (a)
or (b) above, or because the title policy has not been delivered to the Seller
or the Depositor by the applicable title insurer in the case of clause (c)
above, the Depositor shall promptly deliver to the Custodian, in the case of
clause (a) or (b) above, such original Mortgage or such interim assignment, as
the case may be, with evidence of recording indicated thereon upon receipt
thereof from the public recording office, or a copy thereof, certified, if
appropriate, by the relevant recording office and in the case of (c) above,
such original title policy (together with all riders thereto), upon receipt
from the applicable title insurer.
As promptly as practicable subsequent to such transfer and assignment and
delivery to it of each Assignment of Mortgage pursuant to clause (vii) above,
and in any event, within thirty (30) days thereafter, the Trustee shall (at
the Seller's expense) (i) affix the Trustee's name to each Assignment of
Mortgage, as the assignee thereof, (ii) cause such Assignment of Mortgage to
be completed in proper form for recording in the appropriate public office for
real property records within thirty (30) days after receipt thereof and (iii)
cause to be delivered for recording in the appropriate public office for real
property records the Assignments of Mortgages to the Trustee, except that,
with respect to any Assignment of Mortgage as to which the Trustee has not
35
received the information required to prepare such Assignment of Mortgage in
recordable form, the Trustee's obligation to do so and to deliver the same for
such recording shall be as soon as practicable after receipt of such
information and in any event within thirty (30) days after the receipt
thereof, and the Trustee need not cause to be recorded any Assignment of
Mortgage which relates to a Mortgage Loan in any jurisdiction under the laws
of which, as evidenced by an Opinion of Counsel delivered by the Seller (at
the Seller's expense) to the Trustee within twenty (20) days of the Closing
Date, acceptable to the Rating Agencies, the recordation of such Assignment of
Mortgage is not necessary to protect the Trustee's and the Certificateholders'
interest in the related Mortgage Loan.
(c) The Depositor hereby sells, transfers, assigns, sets over and
otherwise conveys to the Trustee in trust for the benefit of the
Certificateholders, without recourse, all right title and interest in such
Subsequent Mortgage Loans, including all interest and principal due on or with
respect to such Subsequent Mortgage Loans on or after the related Subsequent
Cut-off Date and all interest and principal payments on such Subsequent
Mortgage Loans received prior to the Subsequent Cut-off Date in respect of
installments of interest and principal due thereafter, but not including
principal and interest due on such Subsequent Mortgage Loans prior to the
related Subsequent Cut-off Date, any insurance policies in respect of such
Subsequent Mortgage Loans and all proceeds of any of the foregoing.
(d) Upon one Business Day's prior written notice to the Trustee, the
Servicer and the Rating Agencies, on any Business Day during the Prefunding
Period designated by the Depositor, the Depositor, DLJMC, the Servicer and the
Trustee shall complete, execute and deliver a Subsequent Transfer Agreement so
long as no Rating Agency has provided notice that the execution and delivery
of such Subsequent Transfer Agreement will result in a reduction or withdrawal
of the ratings assigned to the Certificates (without regard to the FSA
Policy).
The transfer of Subsequent Mortgage Loans and the other property and
rights relating to them on a Subsequent Transfer Date is subject to the
satisfaction of each of the following conditions:
(i) each Subsequent Mortgage Loan conveyed on such Subsequent
Transfer Date satisfies the representations and warranties applicable to
it under this Agreement as of the applicable Subsequent Transfer Date;
provided, however, that with respect to a breach of a representation and
warranty with respect to a Subsequent Mortgage Loan, the obligation under
Section 2.03(d) of this Agreement of the Seller to cure, repurchase or
replace such Subsequent Mortgage Loan shall constitute the sole remedy
against the Seller respecting such breach available to
Certificateholders, the Depositor or the Trustee;
(ii) the Trustee and the Rating Agencies are provided with an
Opinion of Counsel or Opinions of Counsel, at the expense of the
Depositor, with respect to the qualification of the Trust Fund as a
REMIC, to be delivered as provided pursuant to Section 2.01(e);
(iii) the Rating Agencies and the Trustee are provided with an
Opinion of Counsel or Opinions of Counsel, at the expense of the
Depositor, with respect to the characterization of the transfer of the
Subsequent Mortgage Loans conveyed on such
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Subsequent Transfer Date as a sale, to be delivered as provided pursuant
to Section 2.01(e); and
(iv) the execution and delivery of such Subsequent Transfer
Agreement or conveyance of the related Subsequent Mortgage Loans does not
result in a reduction or withdrawal of any ratings assigned to the
Certificates by the Rating Agencies (without regard to the FSA Policy);
(v) no Subsequent Mortgage Loan conveyed on such Subsequent Transfer
Date was 30 or more days contractually delinquent as of such date;
(vi) the remaining term to stated maturity of such Subsequent
Mortgage Loan will not exceed 30 years for fully amortizing loans or 15
years for balloon loans;
(vii) such Subsequent Mortgage Loan will not have a Mortgage Rate
less than 6.50% per annum;
(viii) the Depositor shall have deposited in the Collection Account
all principal and interest collected with respect to the related
Subsequent Mortgage Loans on or after the related Subsequent Cut-off
Date;
(ix) such Subsequent Mortgage Loan will not have a Loan-to-Value
Ratio greater than 100%;
(x) no Subsequent Mortgage Loan shall have a maturity date after
December 2031;
(xi) such Subsequent Mortgage Loan will not have an original
Loan-to-Value Ratio greater than 100%;
(xii) such Subsequent Mortgage Loan will be otherwise acceptable to
the Rating Agencies;
(xiii) following the conveyance of the Subsequent Mortgage Loans on
such Subsequent Transfer Date the characteristics of the Mortgage Loans
in the Mortgage Pool will be as follows:
(A) weighted average Mortgage Rate of at least 10.10% per
annum;
(B) a weighted average remaining term to stated maturity of
less than 345 months;
(C) a weighted average Loan-to-Value Ratio of not more than
79.00%;
(D) no more than 8.00% of the Mortgage Loans by aggregate
Cut-off Date Principal Balance will be balloon loans;
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(E) no more than 27.00% of the Mortgage Loans by aggregate
Cut-off Date Principal Balance will be concentrated in one state;
and
(F) no more than 9.00% of the Mortgage Loans by aggregate
Cut-off Date Principal Balance will relate to non-owner occupied
properties;
(xiv) neither the applicable Seller nor the Depositor shall be
insolvent or shall be rendered insolvent as a result of such transfer;
(xv) no Event of Default has occurred hereunder;
(xvi) the Depositor shall have delivered to the Trustee an Officer's
Certificate confirming the satisfaction of each of these conditions
precedent; and
(xvii) each Mortgage Loan constitutes a "qualified mortgage" within
the meaning of Section 860G(a)(3) of the Code.
(e) Upon (1) delivery to the Trustee by the Depositor of the Opinions of
Counsel referred to in Sections 2.01(d)(ii) and (iii), (2) delivery to the
Trustee by the Depositor of a revised Mortgage Loan Schedule reflecting the
Subsequent Mortgage Loans conveyed on such Subsequent Transfer Date and the
related Subsequent Mortgage Loans and (3) delivery to the Trustee by the
Depositor of an Officer's Certificate confirming the satisfaction of each of
the conditions precedent set forth in Section 2.01(d), the Trustee shall remit
to the Depositor the Aggregate Subsequent Transfer Amount related to the
Subsequent Mortgage Loans transferred by the Depositor on such Subsequent
Transfer Date from funds in the Prefunding Account.
The Trustee shall not be required to investigate or otherwise verify
compliance with the conditions set forth in the preceding paragraph, except
for its own receipt of documents specified above, and shall be entitled to
rely on the required Officer's Certificate.
SECTION 2.02 Acceptance by the Trustee of the Mortgage Loans.
(a) The Trustee acknowledges receipt of the documents identified in the
Initial Certification in the form annexed hereto as Exhibit G and declares
that it holds and will hold or will cause its agent to hold such documents and
the other documents delivered to it constituting the Mortgage Files, and that
it holds or will hold or will cause its agent to hold such other assets as are
included in the Trust Fund, in trust for the exclusive use and benefit of all
present and future Certificateholders. The Trustee acknowledges that it or the
Custodian will maintain possession of the Mortgage Notes in the State of
Texas, State of California or State of Minnesota, as directed by the Seller,
unless otherwise permitted by the Rating Agencies.
The Trustee agrees to deliver on the Closing Date to the Depositor and
the Servicer an Initial Certification from the Custodian in the form annexed
hereto as Exhibit G. Based on its review and examination, and only as to the
documents identified in such Initial Certification, the Custodian acknowledges
that such documents appear regular on their face and relate to such Mortgage
Loan. The Trustee shall be under no duty or obligation to inspect, review or
examine said documents, instruments, certificates or other papers to determine
that the same are genuine,
38
enforceable or appropriate for the represented purpose or that they have
actually been recorded in the real estate records or that they are other than
what they purport to be on their face.
Not later than 90 days after the Closing Date, the Trustee shall deliver
to the Depositor, the Seller, the Servicer and FSA a Final Certification in
the form annexed hereto as Exhibit H, with any applicable exceptions noted
thereon.
If, in the course of such review, the Trustee is notified by the
Custodian that any document constituting a part of a Mortgage File which does
not meet the requirements of Section 2.01, the Trustee shall cause the
Custodian to list such as an exception in the Final Certification; provided,
however, that the Trustee shall not make any determination as to whether (i)
any endorsement is sufficient to transfer all right, title and interest of the
party so endorsing, as noteholder or assignee thereof, in and to that Mortgage
Note or (ii) any assignment is in recordable form or is sufficient to effect
the assignment of and transfer to the assignee thereof under the mortgage to
which the assignment relates.
The Seller shall promptly correct or cure such defect within 90 days from
the date it is so notified of such defect and, if the Seller does not correct
or cure such defect within such period, the Seller shall either (i) substitute
for the related Mortgage Loan a Qualified Substitute Mortgage Loan, which
substitution shall be accomplished in the manner and subject to the conditions
set forth in Section 2.03, or (ii) purchase such Mortgage Loan from the
Trustee within 90 days from the date the Seller was notified of such defect in
writing at the Repurchase Price of such Mortgage Loan; provided, however, that
if the cure, substitution or repurchase of a Mortgage Loan pursuant to this
provision is required by reason of a delay in delivery of any documents by the
appropriate recording office, then the Seller shall be given 720 days from the
Closing Date to cure such defect or substitute for, or repurchase such
Mortgage Loan; and further provided, that the Seller shall have no liability
for recording any Assignment of Mortgage in favor of the Trustee or for the
Trustee's failure to record such Assignment of Mortgage, and the Seller shall
not be obligated to repurchase or cure any Mortgage Loan as to which such
Assignment of Mortgage is not recorded. The Trustee shall deliver written
notice to each Rating Agency within 270 days from the Closing Date indicating
each Mortgage (a) which has not been returned by the appropriate recording
office or (b) as to which there is a dispute as to location or status of such
Mortgage. Such notice shall be delivered every 90 days thereafter until the
related Mortgage is returned to the Trustee or Custodian. Any such
substitution effected more than 90 days after the Closing Date shall not be
effected prior to the delivery to the Trustee of the Opinion of Counsel
required by Section 2.05 hereof and any substitution shall not be effected
prior to the additional delivery to the Trustee, or the Custodian on its
behalf, of a Request for Release substantially in the form of Exhibit M and
the Mortgage File for any such Qualified Substitute Mortgage Loan. The
Repurchase Price for any such Mortgage Loan shall be deposited by the Seller
in the applicable Collection Account on or prior to the Business Day
immediately preceding such Distribution Date in the month following the month
of repurchase and, upon receipt of such deposit and certification with respect
thereto in the form of Exhibit M hereto, the Trustee, or the Custodian on its
behalf, shall release the related Mortgage File to the Seller and shall
execute and deliver at such entity's request such instruments of transfer or
assignment prepared by such entity, in each case without recourse, as shall be
necessary to vest in such entity, or a designee, the Trustee's interest in any
Mortgage Loan released pursuant hereto.
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The Trustee agrees to cause the Custodian to execute and deliver on the
Subsequent Transfer Date to the Depositor and the Servicer a Subsequent
Certification in the form annexed hereto as Exhibit G. Based on its review and
examination, and only as to the documents identified in such Subsequent
Certification, the Custodian shall acknowledge that such documents appear
regular on their face and relate to such Subsequent Mortgage Loan. The Trustee
shall be under no duty or obligation to inspect, review or examine said
documents, instruments, certificates or other papers to determine that the
same are genuine, enforceable or appropriate for the represented purpose or
that they have actually been recorded in the real estate records or that they
are other than what they purport to be on their face.
Not later than 90 days after the end of the Prefunding Period, the
Trustee shall cause the Custodian to deliver to the Depositor and the Servicer
a Final Certification with respect to the Subsequent Mortgage Loans in the
form annexed hereto as Exhibit H with any applicable exceptions noted thereon.
If, in the course of such review of the Mortgage Files relating to the
Subsequent Mortgage Loans, the Custodian finds any document constituting a
part of a Mortgage File which does not meet the requirements of Section 2.01,
the Trustee shall cause the Custodian to list such as an exception in the
Final Certification; provided, however that the Trustee shall not make any
determination as to whether (i) any endorsement is sufficient to transfer all
right, title and interest of the party so endorsing, as noteholder or assignee
thereof, in and to that Mortgage Note or (ii) any assignment is in recordable
form or is sufficient to effect the assignment of and transfer to the assignee
thereof under the mortgage to which the assignment relates. The Seller shall
cure any such defect or repurchase or substitute for any such Mortgage Loan in
accordance with Section 2.02(a).
(b) It is understood and agreed that the obligation of the Seller to
cure, substitute for or to repurchase any Mortgage Loan which does not meet
the requirements of Section 2.01 shall constitute the sole remedy respecting
such defect available to the Trustee, the Depositor and any Certificateholder
against the Seller.
(c) All of the Mortgage Files are being held pursuant to the Custodial
Agreement. 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 pursuant
to Sections 2.01, 2.02, 2.05, 3.12 shall be performed by the Custodian. At the
expense of DLJMC, the Trustee, from time to time, shall instruct or cause the
instruction of the Custodian to deliver the Mortgage Files to the Trustee for
completion and recordation of the Assignments of Mortgage.
SECTION 2.03 Representations and Warranties of the Seller and Servicer.
(a) Each of DLJMC and Vesta, in their capacities as Seller or Servicer,
hereby makes on behalf of themselves the representations and warranties set
forth in Schedule IIA and Schedule IIB hereto, respectively, and by this
reference incorporated herein, to the Depositor and the Trustee, as of the
Closing Date, or if so specified therein, as of the applicable Cut-off Date.
40
(b) DLJMC, in its capacity as Seller, hereby makes the representations
and warranties set forth in Schedule I to the Depositor and the Trustee, as of
the Closing Date, or the date specified therein, with respect to the Mortgage
Loans identified on Schedule I hereto.
(c) The Depositor hereby assigns the representations and warranties set
forth in Schedule IIIA, and by this reference incorporated herein, to the
Trustee, as of the Closing Date, or if specified therein, as of the Cut-off
Date or such other date as may be specified.
(d) Upon discovery by any of the parties hereto of a breach of a
representation or warranty made pursuant to Section 2.03(b) that materially
and adversely affects the interests of the Certificateholders in any Mortgage
Loan, the party discovering such breach shall give prompt notice thereof to
the other parties. The Seller hereby covenants that within 90 days of the
earlier of its discovery or its receipt of written notice from any party of a
breach of any representation or warranty made by it pursuant to Section
2.03(b) which materially and adversely affects the value of the related
Mortgage Loan or the interests of the Certificateholders, it shall cure such
breach in all material respects, and if such breach is not so cured, shall,
(i) if such 90-day period expires 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 Qualified Substitute 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 Repurchase Price in the manner set forth below; provided, however, that
any such substitution pursuant to (i) above shall not be effected prior to the
delivery to the Trustee of the Opinion of Counsel required by Section 2.05
hereof, if any, and any such substitution pursuant to (i) above shall not be
effected prior to the additional delivery to the Trustee of a Request for
Release substantially in the form of Exhibit M and the Mortgage File for any
such Qualified Substitute Mortgage Loan. The Seller shall promptly reimburse
the Servicer and the Trustee for any actual out-of-pocket expenses reasonably
incurred by the Servicer or the Trustee in respect of enforcing the remedies
for such breach. With respect to any representation and warranty described in
this Section which are made to the best of the Seller's knowledge, if it is
discovered by either the Depositor, the Seller 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 or the interests of the Certificateholders therein, notwithstanding the
Seller's lack of knowledge with respect to the substance of such
representation or warranty, such inaccuracy shall be deemed a breach of the
applicable representation or warranty.
With respect to any Qualified Substitute Mortgage Loan or Loans, the
Seller shall deliver to the Trustee for the benefit of the Certificateholders
the Mortgage Note, the Mortgage, the related assignment of the Mortgage, and
such other documents and agreements as are required by Section 2.01(b), with
the Mortgage Note endorsed and the Mortgage assigned as required by Section
2.01. Scheduled Payments due with respect to Qualified Substitute Mortgage
Loans in the month of substitution shall not be part of the Trust Fund and
will be retained by the Seller. For the month of substitution, distributions
to Certificateholders will include the monthly payment due on any Deleted
Mortgage Loan for such month and thereafter the Seller shall be entitled to
retain all amounts received in respect of such Deleted Mortgage Loan. The
Seller shall amend the related Mortgage Loan Schedule for the benefit of the
Certificateholders to reflect the removal of such Deleted Mortgage Loan and
the substitution of the Qualified Substitute Mortgage Loan or Loans and the
Seller shall deliver the amended Mortgage Loan Schedule to
41
the Trustee and the Depositor. Upon such substitution, the Qualified
Substitute Mortgage Loan or Loans shall be subject to the terms of this
Agreement in all respects, and the Seller shall be deemed to have made with
respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of
substitution, the representations and warranties made pursuant to Section
2.03(b) with respect to such Mortgage Loan. Upon any such substitution and the
deposit to the applicable Collection Account of the amount required to be
deposited therein in connection with such substitution as described in the
following paragraph, the Trustee shall or shall cause the Custodian to release
the Mortgage File held for the benefit of the Certificateholders relating to
such Deleted Mortgage Loan to the Seller and shall execute and deliver at the
Seller's direction such instruments of transfer or assignment prepared by the
Seller, in each case without recourse, as shall be necessary to vest title in
the Seller, or its designee, the Trustee's interest in any Deleted Mortgage
Loan substituted for pursuant to this Section 2.03.
For any month in which the Seller substitutes one or more Qualified
Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the Servicer
will determine the amount (if any) by which the aggregate principal balance of
all such Qualified Substitute Mortgage Loans as of the date of substitution is
less than the aggregate Stated Principal Balance of all such Deleted Mortgage
Loans (after application of the scheduled principal portion of the monthly
payments due in the month of substitution). The amount of such shortage (the
"Substitution Adjustment Amount") plus an amount equal to the aggregate of any
unreimbursed Advances with respect to such Deleted Mortgage Loans shall be
deposited in the applicable Collection Account by the Seller on or before the
Business Day immediately preceding the related Servicer Remittance Date in the
month succeeding the calendar month during which the related Mortgage Loan
became required to be purchased or replaced hereunder.
In the event that the Seller shall have repurchased a Mortgage Loan, the
Repurchase Price therefor shall be deposited in the related Collection Account
pursuant to Section 3.06 on or before the Business Day immediately preceding
the related Servicer Remittance Date in the month following the month during
which the Seller became obligated hereunder to repurchase or replace such
Mortgage Loan and upon such deposit of the Repurchase Price and receipt of a
Request for Release in the form of Exhibit M hereto, the Trustee shall release
or cause the Custodian to release the related Mortgage File held for the
benefit of the Certificateholders to such Person, and the Trustee shall
execute and deliver at such Person's direction such instruments of transfer or
assignment prepared by such Person, in each case without recourse, as shall be
necessary to transfer title from the Trustee. It is understood and agreed that
the obligation under this Agreement of any Person to cure, repurchase or
substitute any Mortgage Loan as to which a breach has occurred and is
continuing shall constitute the sole remedy against such Persons respecting
such breach available to Certificateholders, the Depositor or the Trustee on
their behalf.
The representations and warranties made pursuant to this Section 2.03
shall survive delivery of the respective Mortgage Files to the Trustee, or to
the Custodian on the Trustee's behalf, for the benefit of the
Certificateholders.
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SECTION 2.04 Representations and Warranties of the Depositor as to the
Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee with respect
to each Mortgage Loan that, as of the Closing Date, assuming good title has
been conveyed to the Depositor, the Depositor had good title to the Mortgage
Loans and Mortgage Notes, and did not encumber the Mortgage Loans during its
period of ownership thereof, other than as contemplated by the Agreement.
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 to the Custodian on the Trustee's behalf.
SECTION 2.05 Delivery of Opinion of Counsel in Connection with
Substitutions.
(a) Notwithstanding any contrary provision of this Agreement, no
substitution pursuant to Section 2.02 shall be made more than 90 days after
the Closing Date unless the Seller delivers to the Trustee an Opinion of
Counsel, which Opinion of Counsel shall not be at the expense of either the
Trustee or the Trust Fund, addressed to the Trustee, to the effect that such
substitution will not (i) result in the imposition of the tax on "prohibited
transactions" on the Trust Fund or contributions after the Startup Date, as
defined in Sections 860F(a)(2) and 860G(d) of the Code, respectively, or (ii)
cause any REMIC hereunder to fail to qualify as a REMIC at any time that any
Certificates are outstanding.
(b) Upon discovery by the Depositor, the Seller, the Servicer, or the
Trustee that any Mortgage Loan does not constitute a "qualified mortgage"
within the meaning of Section 860G(a)(3) of the Code, the party discovering
such fact shall promptly (and in any event within five (5) Business Days of
discovery) give written notice thereof to the other parties. In connection
therewith, the Trustee shall require the Seller, at the Seller's option, to
either (i) substitute, if the conditions in Section 2.03(d) with respect to
substitutions are satisfied, a Qualified Substitute Mortgage Loan for the
affected Mortgage Loan, or (ii) repurchase the affected Mortgage Loan within
90 days of such discovery in the same manner as it would a Mortgage Loan for a
breach of representation or warranty made pursuant to Section 2.03. The
Trustee shall reconvey to the Seller 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 Execution and Delivery of Certificates.
The Trustee acknowledges receipt by the Custodian on its behalf of the
documents identified in the Initial Certification in the form annexed hereto
as Exhibit G and the amounts required to be deposited into the Prefunding
Account, the Capitalized Interest Account and the Basis Risk Reserve Fund and,
concurrently with such receipt, has executed and delivered to or upon the
order of the Depositor, the Certificates in authorized denominations
evidencing directly or indirectly the entire ownership of the Trust Fund. The
Trustee agrees to hold the Trust Fund and exercise the rights referred to
above for the benefit of all present and future Holders of the Certificates
and to perform the duties set forth in this Agreement according to its terms.
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SECTION 2.07 REMIC Matters.
The Preliminary Statement sets forth the designations and "latest
possible maturity date" for federal income tax purposes of all interests
created hereby. The "Startup Day" for purposes of the REMIC Provisions shall
be the Closing Date. The "tax matters person" with respect to each REMIC
hereunder shall be the holder of the Class R Certificate. The Trustee on
behalf of the holders of the Class R Certificates shall act as agent for the
"tax matters person". By its acceptance of a Class R Certificate, each holder
thereof shall have agreed to such appointment and shall have consented to the
appointment of the Trustee as its agent to act on behalf of each REMIC
pursuant to the specific duties outlined herein. Each REMIC's fiscal year
shall be the calendar year.
SECTION 2.08 Covenants of the Servicer.
The Servicer hereby covenants to the Depositor and the Trustee for itself
only as follows:
(a) the Servicer shall comply in the performance of its obligations under
this Agreement in all material respects with all reasonable rules and
requirements of the insurer under each Primary Insurance Policy; and
(b) no written information, certificate of an officer, statement
furnished in writing or written report delivered to the Depositor, any
affiliate of the Depositor or the Trustee and prepared by the Servicer
pursuant to this Agreement will contain any untrue statement of a material
fact.
SECTION 2.09 Conveyance of Subsidiary Regular Interests and Acceptance
of the Subsidiary REMIC by the Trustee; Issuance of
Certificates.
(a) The Depositor, concurrently with the execution and delivery hereof,
does hereby transfer, assign, set over and otherwise convey in trust to the
Trustee without recourse all the right, title and interest of the Depositor in
and to the Subsidiary REMIC Regular Interests to the Master REMIC. The Trustee
acknowledges receipt of the Subsidiary REMIC Regular Interests (which are
uncertificated) and declares that it holds and will hold the same in trust for
the exclusive use and ultimate benefit of the holders of the Certificates. The
interests evidenced by the Class R-II Interest, together with the Regular
Certificates, constitute the entire beneficial ownership interest in the
Master REMIC.
(b) Concurrently with (i) the assignment and delivery to the Trustee of
the Subsidiary REMIC (including the Class R-I Interest) and the acceptance by
the Trustee thereof, pursuant to Section 2.01, Section 2.02 and Section
2.09(a) and (ii) the assignment and delivery to the Trustee of the Master
REMIC (including the Class R-II Interest) and the acceptance by the Trustee
thereof, pursuant to Section 2.09(b), the Trustee, pursuant to the written
request of the Depositor executed by an officer of the Depositor, has
executed, authenticated and delivered to or upon the order of the Depositor,
the Class R Certificates in authorized denominations evidencing the Class R-I
Interest and the Class R-II Interest.
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ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
SECTION 3.01 Servicer to Service Mortgage Loans.
For and on behalf of the Certificateholders, the Servicer shall service
and administer the related Mortgage Loans in accordance with the terms of this
Agreement and with Accepted Servicing Practices. In connection with such
servicing and administration, the Servicer shall have full power and
authority, acting alone and/or through Subservicers as provided in Section
3.02 hereof, 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 Mortgaged Property and assumptions of the
Mortgage Notes and related Mortgages (but only in the manner provided in this
Agreement), (iii) to collect any Insurance Proceeds and other Liquidation
Proceeds and (iv) to effectuate foreclosure or other conversion of the
ownership of the Mortgaged Property securing any Mortgage Loan, provided that
the Servicer shall not take any action that is inconsistent with or prejudices
the interests of the Trust Fund or the Certificateholders in any Mortgage Loan
or the rights and interests of the Depositor, the Trustee or the
Certificateholders under this Agreement. The Servicer shall represent and
protect the interests of the Trust Fund in the same manner as it protects its
own interests in mortgage loans in its own portfolio in any claim, proceeding
or litigation regarding a Mortgage Loan, and shall not make or permit any
modification, waiver or amendment of any Mortgage Loan which would cause any
REMIC hereunder to fail to qualify as a REMIC or result in the imposition of
any tax under Section 860F(a) or Section 860G(d) of the Code. Without limiting
the generality of the foregoing, the Servicer, in its own name or in the name
of the Depositor and the Trustee, is hereby authorized and empowered by the
Depositor and the Trustee, when the 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 Mortgage Loans, and with
respect to the Mortgaged Properties held for the benefit of the
Certificateholders. The Servicer shall prepare and deliver to the Depositor
and/or the Trustee such documents requiring execution and delivery by either
or both of them as are necessary or appropriate to enable the Servicer to
service and administer the Mortgage Loans to the extent that the Servicer is
not permitted to execute and deliver such documents pursuant to the preceding
sentence. Upon receipt of such documents, the Depositor and/or the Trustee
shall execute such documents and deliver them to the Servicer.
In accordance with the standards of the preceding paragraph, the Servicer
shall advance or cause to be advanced funds as necessary for the purpose of
effecting the payment of taxes and assessments on the Mortgaged Properties,
which advances shall be reimbursable in the first instance from related
collections from the Mortgagors pursuant to Section 3.06, and further as
provided in Section 3.09. The costs incurred by the Servicer, if any, in
effecting the timely payments of taxes and assessments on the Mortgaged
Properties and related insurance premiums shall not, for the purpose of
calculating monthly distributions to the Certificateholders, be added
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to the Stated Principal Balances of the related Mortgage Loans,
notwithstanding that the terms of such Mortgage Loans so permit.
With respect to the Mortgage Loans, the Servicer of such Mortgage Loans
agrees that, with respect to the Mortgagors of such Mortgage Loans, the
Servicer shall accurately and fully report its borrower credit files to
Equifax, Transunion & Experian in a timely manner.
The Servicer hereby acknowledges that, to the extent the Servicer has
previously serviced some or all of the Mortgage Loans pursuant to another
servicing agreement, the provisions contained in this Agreement shall
supersede the provisions contained in such other servicing agreement.
SECTION 3.02 Subservicing; Enforcement of the Obligations of
Subservicers.
(a) The Mortgage Loans may be subserviced by a Subservicer on behalf of
the Servicer in accordance with the servicing provisions of this Agreement,
provided that the Subservicer is a FNMA-approved lender or a FHLMC
seller/servicer in good standing, and no event has occurred, including but not
limited to a change in insurance coverage, which would make it unable to
comply with the eligibility requirements for lenders imposed by FNMA or for
seller/servicer imposed by FHLMC, or which would require notification to FNMA
or FHLMC. A Servicer may perform any of its servicing responsibilities
hereunder or may cause the Subservicer to perform any such servicing
responsibilities on its behalf, but the use by the Servicer of the Subservicer
shall not release the Servicer from any of its obligations hereunder and the
Servicer shall remain responsible hereunder for all acts and omissions of the
Subservicer as fully as if such acts and omissions were those of the Servicer.
The Servicer shall pay all fees and expenses of any Subservicer engaged by the
Servicer from its own funds.
Notwithstanding the foregoing, the Servicer shall be entitled to
outsource one or more separate servicing functions to a Person (each, an
"Outsourcer") that does not meet the eligibility requirements for a
Subservicer, so long as such outsourcing does not constitute the delegation of
the Servicer's obligation to perform all or substantially all of the servicing
of the related Mortgage Loans to such Outsourcer. In such event, the use by
the Servicer of any such Outsourcer shall not release the Servicer from any of
its obligations hereunder and the Servicer shall remain responsible hereunder
for all acts and omissions of such Outsourcer as fully as if such acts and
omissions were those of the Servicer, and the Servicer shall pay all fees and
expenses of the Outsourcer from the Servicer's own funds.
(b) At the cost and expense of the Servicer, without any right of
reimbursement from the Depositor, Trustee, or the applicable Collection
Account, the Servicer shall be entitled to terminate the rights and
responsibilities of its Subservicer and arrange for any servicing
responsibilities to be performed by a successor Subservicer meeting the
requirements set forth in Section 3.02(a); provided, however, that nothing
contained herein shall be deemed to prevent or prohibit the Servicer, at the
Servicer's option, from electing to service the related Mortgage Loans itself.
In the event that the Servicer's responsibilities and duties under this
Agreement are terminated pursuant to Section 7.01, and if requested to do so
by the Trustee, the Servicer shall at its own cost and expense terminate the
rights and responsibilities of its Subservicer as soon as is reasonably
possible. The Servicer shall pay all fees, expenses or penalties necessary in
order to
46
terminate the rights and responsibilities of its Subservicer from the
Servicer's own funds without any right of reimbursement from the Depositor,
Trustee, or the applicable Collection Account.
(c) Notwithstanding any of the provisions of this Agreement relating to
agreements or arrangements between the Servicer and its Subservicer, the
Servicer and its Outsourcer, or any reference herein to actions taken through
the Subservicer, the Outsourcer, or otherwise, no Servicer shall be relieved
of its obligations to the Depositor, Trustee or Certificateholders 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. The
Servicer shall be entitled to enter into an agreement with its Subservicer and
Outsourcer for indemnification of the Servicer by such Subservicer or
Outsourcer, as applicable, and nothing contained in this Agreement shall be
deemed to limit or modify such indemnification.
For purposes of this Agreement, the Servicer shall be deemed to have
received any collections, recoveries or payments with respect to the related
Mortgage Loans that are received by a related Subservicer or Outsourcer
regardless of whether such payments are remitted by the Subservicer or
Outsourcer to the Servicer.
Any Subservicing Agreement and any other transactions or services
relating to the Mortgage Loans involving a Subservicer shall be deemed to be
between the Subservicer, and the Servicer alone, and the Depositor, the
Trustee and the other Servicer shall have no obligations, duties or
liabilities with respect to a Subservicer including no obligation, duty or
liability to pay a Subservicer's fees and expenses.
SECTION 3.03 Special Serviced Mortgage Loans
If directed by the Special Servicer and solely at the Special Servicer's
option, the Servicer shall transfer the servicing of any Mortgage Loan 90 days
or more delinquent to the Special Servicer. The Special Servicer shall
thereupon assume all of the rights and obligations of the Servicer hereunder
arising thereafter and the predecessor servicer shall have no further
responsibility with respect to such Mortgage Loan (except that the Special
Servicer shall not be (i) liable for losses of the Servicer pursuant to
Section 3.10 hereof for any acts or omissions of the related predecessor
Servicer hereunder prior to the servicing transfer date, (ii) obligated to
effectuate repurchases or substitutions of Mortgage Loans hereunder including,
but not limited to, repurchases or substitutions of Mortgage Loans pursuant to
Section 2.02 or 2.03 hereof or (iii) deemed to have made any representations
and warranties of such predecessor Servicer hereunder). Upon the transfer of
the servicing of any such Mortgage Loan to the Special Servicer, the Special
Servicer shall be entitled to the Servicing Fee and other compensation
accruing after the servicing transfer date with respect to such Mortgage Loans
pursuant to Section 3.15.
In connection with the transfer of the servicing of any Mortgage Loan to
the Special Servicer, the Servicer shall, at the Servicer's expense, deliver
to the Special Servicer all documents and records relating to such Mortgage
Loans and an accounting of amounts collected or held by it and otherwise use
its best efforts to effect the orderly and efficient transfer of the servicing
to the Special Servicer. On the servicing transfer date, the Special Servicer
shall reimburse the predecessor servicer for all unreimbursed Advances,
Servicing Advances and
47
Servicing Fees relating to the Mortgage Loans for which the servicing is being
transferred. The Special Servicer shall be entitled to be reimbursed for all
such Advances, Servicing Advances and Servicing Fees paid by the Special
Servicer to the predecessor servicer pursuant to Section 3.09.
SECTION 3.04 Notification of Adjustments.
With respect to each Mortgage Loan with an adjustable Mortgage Rate, the
Servicer shall adjust the Mortgage Rate on the related Adjustment Date in
compliance with the requirements of applicable law and the related Mortgage
and Mortgage Note. The Servicer shall execute and deliver any and all
necessary notices required under applicable law and the terms of the related
Mortgage Note and Mortgage regarding the Mortgage Rate adjustments. Upon the
discovery by the Servicer or the receipt of notice from the Trustee that the
Servicer has failed to adjust a Mortgage Rate in accordance with the terms of
the related Mortgage Note, that Servicer shall immediately deposit in the
Certificate Account from its own funds the amount of any interest loss or
deferral caused the Trustee thereby.
SECTION 3.05 Trustee to Act as Servicer.
In the event that the Servicer shall for any reason no longer be the
Servicer hereunder (including by reason of an Event of Default, as defined in
Section 7.01), the Trustee or its successor shall thereupon assume all of the
rights and obligations of the Servicer hereunder arising thereafter (except
that the Trustee shall not be (i) liable for losses of the Servicer pursuant
to Section 3.10 hereof or any acts or omissions of the related predecessor
Servicer hereunder, (ii) obligated to make Advances if it is prohibited from
doing so by applicable law, (iii) obligated to effectuate repurchases or
substitutions of Mortgage Loans hereunder including, but not limited to,
repurchases or substitutions of Mortgage Loans pursuant to Section 2.02 or
2.03 hereof or (iv) deemed to have made any representations and warranties of
the Servicer hereunder). Any such assumption shall be subject to Section 7.02
hereof.
The Servicer shall, upon request of the Trustee, but at the expense of
the Servicer, deliver to the assuming party all documents and records relating
to each Subservicing Agreement or substitute Subservicing Agreement and the
Mortgage Loans then being serviced thereunder and hereunder by the Servicer
and an accounting of amounts collected or held by it and otherwise use its
best efforts to effect the orderly and efficient transfer of the substitute
Subservicing Agreement to the assuming party at the expense of the outgoing
Servicer.
SECTION 3.06 Collection of Mortgage Loans; Collection Account;
Certificate Account; Prefunding Account;
Capitalized Interest Account
(a) Continuously from the date hereof until the principal and interest on
all Mortgage Loans have been paid in full or such Mortgage Loans have become
Liquidation Mortgage Loans, the Servicer shall proceed in accordance with the
customary and usual standards of practice of prudent mortgage loan servicers
to collect all payments due under each of the related Mortgage Loans when the
same shall become due and payable to the extent consistent with this Agreement
and the terms and provisions of the MGIC Policy and any related Primary
Insurance Policy and shall take special care with respect to Mortgage Loans
for which the Servicer collects escrow
48
payments in ascertaining and estimating Escrow Payments and all other charges
that will become due and payable with respect to the Mortgage Loans and the
Mortgaged Properties, to the end that the installments payable by the
Mortgagors will be sufficient to pay such charges as and when they become due
and payable. Consistent with the foregoing, the 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 period not greater than 180 days; provided,
however, that the Servicer cannot extend the maturity of any such Mortgage
Loan past the date on which the final payment is due on the latest maturing
Mortgage Loan as of the Initial Cut-off Date. In the event of any such
arrangement, the Servicer shall make Advances on the related Mortgage Loan in
accordance with the provisions of Section 4.01 during the scheduled period in
accordance with the amortization schedule of such Mortgage Loan without
modification thereof by reason of such arrangements. The Servicer shall not 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.
(b) The Servicer shall segregate and hold all funds collected and
received pursuant to a Mortgage Loan separate and apart from any of its own
funds and general assets and shall establish and maintain one or more
Collection Accounts, in the form of time deposit or demand accounts, titled
"[Servicer's name], in trust for the Holders of Credit Suisse First Boston
Mortgage Securities Corp., CSFB ABS Trust Series 2001-HE17, CSFB Mortgage
Pass-Through Certificates, Series 2001-HE17". Each Collection Account shall be
an Eligible Account. Any funds deposited in a Collection Account shall at all
times be either invested in Eligible Investments or shall be fully insured to
the full extent permitted under applicable law. Funds deposited in a
Collection Account may be drawn on by the Servicer in accordance with Section
3.09.
(c) The Servicer shall deposit in the applicable Collection Account on a
daily basis, and, in each case, retain therein, the following collections
remitted by Subservicers or payments received by the Servicer and payments
made by the Servicer subsequent to the Cut-off Date, other than payments of
principal and interest due on or before the Cut-off Date:
(i) all payments on account of principal on the related Mortgage
Loans, including all Principal Prepayments;
(ii) all payments on account of interest on the related Mortgage
Loans adjusted to the per annum rate equal to the Mortgage Rate reduced
by the Servicing Fee Rate;
(iii) all Liquidation Proceeds on the related Mortgage Loans;
(iv) all Insurance Proceeds on the related Mortgage Loans including
amounts required to be deposited pursuant to Section 3.10 (other than
proceeds to be held in the Escrow Account and applied to the restoration
or repair of the Mortgaged Property or released to the Mortgagor in
accordance with Section 3.10);
49
(v) all Advances made by the Servicer pursuant to Section 4.01;
(vi) all Substitution Adjustment Amounts and Repurchase Prices on
the related Mortgage Loans;
(vii) with respect to each Principal Prepayment on the related
Mortgage Loans, the Prepayment Interest Shortfall, if any, for the
Prepayment Period. The aggregate of such deposits shall be made from the
Servicer's own funds, without reimbursement therefor, up to a maximum
amount per month equal to the Compensating Interest Payment, if any, for
the Mortgage Loans serviced by that Servicer and Distribution Date;
(viii) any amounts required to be deposited by the Servicer in
respect of net monthly income from REO Property pursuant to Section 3.12;
and
(ix) any other amounts required to be deposited hereunder.
The foregoing requirements for deposit into each Collection Account shall
be exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, Ancillary Income need not be deposited by the
Servicer into such Collection Account. In addition, notwithstanding the
provisions of this Section 3.06, the Servicer may deduct from amounts received
by it, prior to deposit to the applicable Collection Account, any portion of
any Scheduled Payment representing the Servicing Fee. In the event that the
Servicer shall remit any amount not required to be remitted, it may at any
time withdraw or direct the institution maintaining the related Collection
Account to withdraw such amount from such Collection Account, any provision
herein to the contrary notwithstanding. Such withdrawal or direction may be
accomplished by delivering written notice thereof to the Trustee or such other
institution maintaining such Collection Account which describes the amounts
deposited in error in such Collection Account. The Trustee may conclusively
rely on such notice and shall have no liability in connection with the
withdrawal of such funds at the direction of the Servicer. The Servicer shall
maintain adequate records with respect to all withdrawals made by it pursuant
to this Section. All funds deposited in a Collection Account shall be held in
trust for the Certificateholders until withdrawn in accordance with Section
3.09(a).
(d) On or prior to the Closing Date, the Trustee shall establish and
maintain, on behalf of the Certificateholders, the Certificate Account. The
Trustee shall, promptly upon receipt, deposit in the Certificate Account and
retain therein the following:
(i) the aggregate amount remitted by the Servicer to the
Trustee pursuant to Section 3.09(a)(viii); and
(ii) any other amounts deposited hereunder which are required to
be deposited in the Certificate Account.
In the event that the Servicer shall remit to the Trustee any amount not
required to be remitted, it may at any time in writing direct the Trustee to
withdraw such amount from the Certificate Account, any provision herein to the
contrary notwithstanding. Such direction may be accomplished by delivering
written notice to the Trustee (upon which the Trustee may conclusively rely)
which describes the amounts deposited in error in the Certificate Account. All
50
funds deposited in the Certificate Account shall be held by the Trustee in
trust for the Certificateholders until disbursed in accordance with this
Agreement or withdrawn in accordance with Section 3.09(b). In no event shall
the Trustee incur liability for withdrawals from the Certificate Account at
the direction of the Servicer.
(e) Each institution at which a Collection Account or the Prefunding
Account is maintained shall either hold such funds on deposit uninvested or
shall invest the funds therein in Eligible Investments as directed in writing
by the Servicer (in the case of a Collection Account) and the Depositor (in
the case of the Prefunding Account) which shall mature not later than (i) in
the case of a Collection Account, the Servicer Remittance Date and (ii) in the
case of the Prefunding Account, the Business Day immediately preceding a
Subsequent Transfer Date and, in each case, shall not be sold or disposed of
prior to its maturity. All such Eligible 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 balances or investment of funds on
deposit in a Collection Account shall be for the benefit of the Servicer as
servicing compensation and shall be remitted to it monthly. The amount of any
net investment losses in a Collection Account shall promptly be deposited by
the Servicer in such Collection Account. The Trustee in its fiduciary capacity
shall not be liable for the amount of any loss incurred in respect of any
investment or lack of investment of funds held in the Collection Account made
in accordance with this Section 3.06. All funds on deposit in the Certificate
Account shall remain uninvested or may be invested in by the Trustee, in its
sole discretion in Eligible Investments selected by the Trustee. All net
income and gain realized from the investment of, and all earnings on, funds
deposited in the Certificate Account shall be for the benefit of the Trustee
and shall be available to be withdrawn pursuant to Section 3.09(b)(i). All net
income and gain realized from the investment of, and all earnings on, funds
deposited in the Simple Interest Excess Sub-Accounts shall be paid in
accordance with Section 3.07. All income and gain net of any losses realized
from any such balances or investment of funds on deposit in the Prefunding
Account shall be for the benefit of the Depositor and shall be remitted to it
monthly. The amount of any net investment losses in the Prefunding Account
shall promptly be deposited by the Depositor in the Prefunding Account. The
Trustee in its fiduciary capacity shall not be liable for the amount of any
loss incurred in respect of any investment or lack of investment of funds held
in the Collection Account or the Prefunding Account (other than as provided in
this Section 3.06(e)) and made in accordance with this Section 3.06.
(f) The Servicer shall give notice to the Trustee, each Rating Agency and
the Depositor of any proposed change of the location of the related Collection
Account prior to any change thereof. The Trustee shall give notice to the
Servicer, each Rating Agency and the Depositor of any proposed change of the
location of the Certificate Account or the Prefunding Account prior to any
change thereof.
(g) The Trustee shall establish and maintain, on behalf of the
Certificateholders, the Prefunding Account. On the Closing Date the Depositor
shall remit the Pre-Funded Amount to the Trustee for deposit in the Prefunding
Account. On each Subsequent Transfer Date, upon satisfaction of the conditions
for such Subsequent Transfer Date set forth in Sections 2.01(d) and (e), with
respect to the related Subsequent Transfer Agreement, the Trustee shall remit
to the Depositor the applicable Aggregate Subsequent Transfer Amount as
payment of the purchase price for the related Subsequent Mortgage Loans.
51
If any funds remain in the Prefunding Account on November 21, 2001, to
the extent that they represent earnings on the amounts originally deposited
into the Prefunding Account, the Trustee shall distribute them to the order of
the Depositor. The remaining funds shall be transferred to the Certificate
Account to be included as part of principal distributions to the Certificates
on the November 2001 Distribution Date.
(h) The Trustee shall establish and maintain, on behalf of the
Certificateholders, the Capitalized Interest Account. On the Closing Date the
Depositor shall remit the Capitalized Interest Deposit to the Trustee for
deposit in the Capitalized Interest Account. On the Business Day prior to each
of the September 2001, October 2001 and November 2001 Distribution Date, the
Trustee shall transfer from the Capitalized Interest Account to the
Certificate Account an amount equal to the Capitalized Interest Requirement
for such Distribution Date. On each of the September 2001 and October 2001
Distribution Dates, any Overfunded Interest Amount shall be withdrawn from the
Capitalized Interest Account and paid to the Depositor. Any funds remaining in
the Capitalized Interest Account immediately after the November 2001
Distribution Date shall be paid to the Depositor.
SECTION 3.07 Establishment of and Deposits to Escrow Accounts;
Permitted Withdrawals from Escrow Accounts;
Payments of Taxes, Insurance and Other Charges;
Simple Interest Excess Sub-Accounts;
Deposits in Simple Interest Excess Sub-Accounts.
(a) To the extent required by the related Mortgage Note and not violative
of current law, the Servicer shall segregate and hold all funds collected and
received pursuant to a Mortgage Loan constituting Escrow Payments separate and
apart from any of its own funds and general assets and shall establish and
maintain one or more Escrow Accounts, in the form of time deposit or demand
accounts, titled, "[Servicer's name], in trust for various mortgagors related
to Credit Suisse First Boston Mortgage Securities Corp., Mortgage Pass-Through
Certificates, Series 2001-HE17". The Escrow Accounts shall be Eligible
Accounts. Funds deposited in the Escrow Account may be drawn on by the
Servicer in accordance with Section 3.07(d).
(b) The Servicer shall deposit in its Escrow Account or Accounts on a
daily basis within two Business Days of receipt and retain therein:
(i) all Escrow Payments collected on account of the related Mortgage
Loans, for the purpose of effecting timely payment of any such items as
required under the terms of this Agreement; and
(ii) all amounts representing Insurance Proceeds which are to be
applied to the restoration or repair of any related Mortgaged Property.
(c) The Servicer shall make withdrawals from the Escrow Account only to
effect such payments as are required under this Agreement, as set forth in
Section 3.07(d). The Servicer shall be entitled to retain any interest paid on
funds deposited in the related Escrow Account by the depository institution,
other than interest on escrowed funds required by law to be paid to the
applicable Mortgagors. To the extent required by law, the Servicer shall pay
interest on escrowed
52
funds to the Mortgagor notwithstanding that the Escrow Account may be
non-interest bearing or that interest paid thereon is insufficient for such
purposes.
(d) Withdrawals from the Escrow Account or Accounts may be made by the
Servicer only:
(i) to effect timely payments of ground rents, taxes, assessments,
water rates, mortgage insurance premiums, condominium charges, fire,
hazard and flood insurance premiums or other items constituting Escrow
Payments for the related Mortgage;
(ii) to reimburse the Servicer for any Servicing Advances made by
the Servicer pursuant to Section 3.07(e) with respect to a related
Mortgage Loan, but only from amounts received on the related Mortgage
Loan which represent late collections of Escrow Payments thereunder;
(iii) to refund to any Mortgagor any funds found to be in excess of
the amounts required under the terms of the related Mortgage Loan;
(iv) for transfer to the related Collection Account to reduce the
principal balance of the related Mortgage Loan in accordance with the
terms of the related Mortgage and Mortgage Note;
(v) for application to restore or repair of the related Mortgaged
Property in accordance with the procedures outlined in Section 3.10(e);
(vi) to pay to the Servicer, or any Mortgagor to the extent required
by law, any interest paid on the funds deposited in such Escrow Account;
(vii) to remove funds inadvertently placed in the related Escrow
Account by the Servicer; and
(viii) to clear and terminate such Escrow Account on the termination
of this Agreement.
(e) With respect to each Mortgage Loan, the Servicer shall maintain
accurate records reflecting the status of ground rents and taxes and any other
item or charge (including, without limitation, assessments, water rates or
sewer rents) which may become a lien senior to the lien of the related
Mortgage and the status of Primary Insurance Policy premiums and fire and
hazard insurance coverage and shall obtain, from time to time, all bills for
the payment of such charges (including renewal premiums) and shall effect or
cause to be effected payment thereof prior to the applicable penalty or
termination date. To the extent that a Mortgage does not provide for Escrow
Payments, the Servicer shall determine that any such payments are made by the
Mortgagor prior to the applicable penalty or termination date. The Servicer
assumes fill responsibility for, with respect to the Mortgage Loans it
services, (i) the timely payment of all such bills and shall effect timely
payment of all such charges irrespective of each Mortgagor's faithful
performance in the payment of same or the making of the Escrow Payments, and
the Servicer shall make Servicing Advances from its own funds to effect such
payments to the extent that the Servicer, in accordance with Accepted
Servicing Practices, deems such Servicing
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Advance recoverable, and (ii) any penalties or late charges incurred in
connection with such bills; provided, however, the Servicer shall not be so
obligated with respect to any Mortgage which does not provide for Escrow
Payments; provided, further, the Special Servicer shall be entitled to
reimbursement as a Servicing Advance for any such penalties or late charges
related to a Special Serviced Mortgage Loan and such bills and charges due
prior to the transfer of the servicing of such Mortgage Loan to the Special
Servicer pursuant to Section 3.05.
(f) No later than the Closing Date, the Servicer shall establish and
maintain a sub-account of the Collection Account titled "Vesta Servicing L.P.,
Simple Interest Excess Sub-Account in trust for the Holders of Credit Suisse
First Boston Mortgage Securities Corp., CSFB ABS Trust Series 2001-HE17, CSFB
Mortgage Pass-Through Certificates, Series 2001-HE17". The Servicer shall, on
each Determination Date transfer from the Collection Account to the Simple
Interest Excess Sub-Account all Net Simple Interest Excess, if any, pursuant
to Section 3.09(a)(ix), and shall maintain a record of all such deposits.
(g) The Servicer shall withdraw amounts on deposit in the applicable
Simple Interest Excess Sub-Account on each Determination Date for deposit to
the Certificate Account in an amount equal to the lesser of (i) the amount on
deposit therein, and (ii) the Net Simple Interest Shortfall for such
Distribution Date.
(h) The Servicer shall distribute to the Class X Certificateholder 90% of
the balance in the applicable Simple Interest Excess Sub-Account on the
Distribution Date each year occurring in September, commencing in September
2002. Such distributions shall be deemed to be made on a first-in, first-out
basis. In addition, the Servicer shall clear and terminate the Simple Interest
Excess Sub-Account upon the termination of this Agreement and retain any funds
remaining therein.
(i) Amounts on deposit in the Simple Interest Excess Sub-Accounts may be
invested in Eligible Investments. All income and gain net of any losses
realized from any such balances or investment of funds on deposit in a Simple
Interest Excess Sub-Account shall be for the benefit of the Servicer as
servicing compensation and shall be remitted to it monthly. The amount of any
net investment losses in a Simple Interest Excess Sub-Account shall promptly
be deposited by the Servicer in such Simple Interest Excess Sub-Account.
SECTION 3.08 Access to Certain Documentation and Information Regarding
the Mortgage Loans; Inspections.
(a) The Servicer shall afford the Depositor and the Trustee reasonable
access to all records and documentation regarding the Mortgage Loans and all
accounts, insurance information and other matters relating to this Agreement,
such access being afforded without charge, but only upon reasonable request
and during normal business hours at the office designated by the Servicer. In
addition, the Servicer shall provide to the Special Servicer reasonable access
to all records and documentation regarding the Mortgage Loans serviced by it
that become Special Serviced Mortgage Loans.
(b) Upon reasonable advance notice in writing, the Servicer will provide
to each Certificateholder which is a savings and loan association, bank or
insurance company certain
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reports and reasonable access to information and documentation regarding the
Mortgage Loans sufficient to permit such Certificateholder to comply with
applicable regulations of the OTS or other regulatory authorities with respect
to investment in the Certificates; provided that the Servicer shall be
entitled to be reimbursed by each such Certificateholder for actual expenses
incurred by the Servicer in providing such reports and access.
(c) The Servicer shall inspect the related Mortgaged Properties as often
as deemed necessary by the Servicer in the Servicer's sole discretion, to
assure itself that the value of such Mortgaged Property is being preserved and
shall conduct subsequent inspections in accordance with Accepted Servicing
Practices or as may be required by the primary mortgage guaranty insurer. The
Servicer shall keep a written or electronic report of each such inspection.
SECTION 3.09 Permitted Withdrawals from the Collection Accounts and
Certificate Account.
(a) The Servicer may from time to time make withdrawals from the related
Collection Account for the following purposes:
(i) to pay to the Servicer (to the extent not previously retained by
the Servicer) the servicing compensation to which it is entitled pursuant
to Section 3.15, and to pay to the Servicer, as additional servicing
compensation, earnings on or investment income with respect to funds in
or credited to such Collection Account and any sub-account thereof;
(ii) to reimburse the Servicer for unreimbursed Advances made by it,
such right of reimbursement pursuant to this subclause (ii) being limited
to amounts received on the Mortgage Loan(s) in respect of which any such
Advance was made (including without limitation, late recoveries of
payments, Liquidation Proceeds and Insurance Proceeds to the extent
received by the Servicer);
(iii) to reimburse the Servicer for any Nonrecoverable Advance
previously made;
(iv) to reimburse the Servicer for (A) unreimbursed Servicing
Advances, the Servicer's right to reimbursement pursuant to this clause
(iv) with respect to any Mortgage Loan being limited to amounts received
on such Mortgage Loan which represent late payments of principal and/or
interest (including, without limitation, Liquidation Proceeds and
Insurance Proceeds with respect to such Mortgage Loan) respecting which
any such advance was made and (B) for unpaid Servicing Fees as provided
in Section 3.12 hereof;
(v) to pay to the purchaser, with respect to each Mortgage Loan or
property acquired in respect thereof that has been purchased pursuant to
Section 2.02, 2.03 or 3.11, all amounts received thereon after the date
of such purchase;
(vi) to reimburse the Seller, the Servicer or the Depositor for
expenses incurred by any of them and reimbursable pursuant to Section
3.10 or 6.03 hereof;
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(vii) to withdraw any amount deposited in such Collection Account
and not required to be deposited therein;
(viii) on or prior to 4:00 p.m. New York time on the Servicer
Remittance Date preceding each Distribution Date, to withdraw an amount
equal to the sum of the portion of the Interest Remittance Amount, the
Principal Remittance Amount and the Loss Mitigation Advisor Fee in such
Collection Account applicable to the Mortgage Loans serviced by the
Servicer for such Distribution Date and all Prepayment Premiums received
during the related Prepayment Period and remit such amount to the Trustee
for deposit in the Certificate Account;
(ix) to deposit to the Simple Interest Excess Sub-Account any amount
required to be deposited therein pursuant to Section 3.07(f); and
(x) to clear and terminate such Collection Account upon termination
of this Agreement pursuant to Section 9.01 hereof.
The 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 Collection Account pursuant to such subclauses (i), (ii), (iv) and
(v). Prior to making any withdrawal from a Collection Account pursuant to
subclause (iii), the Servicer shall deliver to the Trustee a certificate of a
Servicing Officer indicating the amount of any previous Advance determined by
the Servicer to be a Nonrecoverable Advance and identifying the related
Mortgage Loans(s), and their respective portions of such Nonrecoverable
Advance.
(b) The Trustee shall withdraw funds from the Certificate Account for
distributions to Certificateholders and MGIC in the manner specified in this
Agreement (and to withhold from the amounts so withdrawn, the amount of any
taxes that it is authorized to withhold pursuant to the last paragraph of
Section 8.11). In addition, the Trustee may from time to time make withdrawals
from the Certificate Account for the following proposes:
(i) to pay to itself any investment income from balances in the
Certificate Account prior to distributions to Certificateholders;
(ii) on or prior to each Distribution Date, to pay to the Loss
Mitigation Advisor, the Loss Mitigation Advisor Fee for that Distribution
Date;
(iii) to withdraw and return to the Servicer for deposit to the
applicable Collection Account any amount deposited in the Certificate
Account and not required to be deposited therein; and
(iv) to clear and terminate the Certificate Account upon termination
of the Agreement pursuant to Section 9.01 hereof.
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SECTION 3.10 Maintenance of Hazard Insurance; Mortgage Impairment
Insurance and Primary Insurance Policy; Claims;
Restoration of Mortgaged Property.
(a) The Servicer shall cause to be maintained for each Mortgage Loan
hazard insurance such that all buildings upon the Mortgaged Property are
insured by a generally acceptable insurer rated either: "V" or better in the
current Best's Key Rating Guide ("Best's") or acceptable to FNMA and/or FHLMC
against loss by fire, hazards of extended coverage and such other hazards as
are customary in the area where the Mortgaged Property is located, in an
amount which is at least equal to the lesser of (i) the maximum insurable
value of the improvements securing such Mortgage Loan and (ii) the greater of
(A) the outstanding principal balance of the Mortgage Loan and (B) an amount
such that the proceeds of such policy shall be sufficient to prevent the
Mortgagor and/or the mortgagee from becoming a co-insurer.
If upon origination of the Mortgage Loan, the related Mortgaged Property
was located in an area identified in the Federal Register by the Flood
Emergency Management Agency as having special flood hazards (and such flood
insurance has been made available), the Servicer shall cause a flood insurance
policy to be maintained with respect to such Mortgage Loan. Such policy shall
meet the requirements of the current guidelines of the Federal Insurance
Administration and be in an amount representing coverage equal to the lesser
of (i) the minimum amount required, under the terms of coverage, to compensate
for any damage or loss on a replacement cost basis (or the unpaid principal
balance of the mortgage if replacement cost coverage is not available for the
type of building insured) and (ii) the maximum amount of insurance which is
available under the Flood Disaster Protection Act of 1973, as amended. If at
any time during the term of the Mortgage Loan, the Servicer determines in
accordance with applicable law and pursuant to the FNMA Guides that a
Mortgaged Property is located in a special flood hazard area and is not
covered by flood insurance or is covered in an amount less than the amount
required by the Flood Disaster Protection Act of 1973, as amended, the
Servicer shall notify the related Mortgagor that the Mortgagor must obtain
such flood insurance coverage, and if said Mortgagor fails to obtain the
required flood insurance coverage within 45 days after such notification, the
Servicer shall immediately force place the required flood insurance on the
Mortgagor's behalf.
If a Mortgage is secured by a unit in a condominium project, the Servicer
shall verify that the coverage required of the owner's association, including
hazard, flood, liability, and fidelity coverage, is being maintained in
accordance with the then current FNMA or FHLMC requirements, and secure from
the owner's association its agreement to notify the Servicer promptly of any
change in the insurance coverage or of any condemnation or casualty loss that
may have a material effect on the value of the Mortgaged Property as security.
The Servicer shall cause to be maintained on each Mortgaged Property such
other additional special hazard insurance as may be required pursuant to such
applicable laws and regulations as shall at any time be in force and as shall
require such additional insurance, or pursuant to the requirements of any
Primary Insurance Policy insurer, or as may be required to conform with
Accepted Servicing Practices.
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All policies required hereunder shall name the Servicer as loss payee and
shall be endorsed with standard or union mortgagee clauses, without
contribution, which shall provide for prior written notice of any
cancellation, reduction in amount or material change in coverage.
A Servicer shall not interfere with the Mortgagor's freedom of choice at
the origination of such Mortgage Loan in selecting either his insurance
carrier or agent, provided, however, that the Servicer shall not accept any
such insurance policies from insurance companies unless such companies are
rated: V in Best's or acceptable FNMA and/or FHLMC and are licensed to do
business in the jurisdiction in which the Mortgaged Property is located. The
Servicer shall determine that such policies provide sufficient risk coverage
and amounts, that they insure the property owner, and that they properly
describe the property address.
Pursuant to Section 3.06, any amounts collected by the Servicer under any
such policies (other than amounts to be deposited in the related Escrow
Account and applied to the restoration or repair of the related Mortgaged
Property, or property acquired in liquidation of the Mortgage Loan, or to be
released to the Mortgagor, in accordance with the Servicer's normal servicing
procedures) shall be deposited in the related Collection Account (subject to
withdrawal pursuant to Section 3.09(a)).
Any cost incurred by the Servicer in maintaining any such insurance shall
not, for the purpose of calculating monthly distributions to the
Certificateholders or remittances to the Trustee for their benefit, be added
to the principal balance of the Mortgage Loan, notwithstanding that the terms
of the Mortgage Loan so permit. Such costs shall be recoverable by the
Servicer out of late payments by the related Mortgagor or out of Liquidation
Proceeds or otherwise to the extent permitted by Section 3.09 hereof. It is
understood and agreed that no earthquake or other additional insurance is to
be required of any Mortgagor or maintained on property acquired in respect of
a Mortgage other than pursuant to such applicable laws and regulations as
shall at any time be in force and as shall require such additional insurance.
(b) In the event that the Servicer shall obtain and maintain a blanket
policy insuring against losses arising from fire and hazards covered under
extended coverage on all of the related Mortgage Loans, then, to the extent
such policy provides coverage in an amount equal to the amount required
pursuant to Section 3.10(a) and otherwise complies with all other requirements
of Section 3.10(a), it shall conclusively be deemed to have satisfied its
obligations as set forth in Section 3.10(a). Any amounts collected by the
Servicer under any such policy relating to a Mortgage Loan shall be deposited
in the related Collection Account subject to withdrawal pursuant to Section
3.09(a). Such policy may contain a deductible clause, in which case, in the
event that there shall not have been maintained on the related Mortgaged
Property a policy complying with Section 3.10(a), and there shall have been a
loss which would have been covered by such policy, the Servicer shall deposit
in the Collection Account at the time of such loss the amount not otherwise
payable under the blanket policy because of such deductible clause, such
amount to be deposited from the Servicer's funds, without reimbursement
therefor. In connection with its activities as Servicer of the related
Mortgage Loans, the Servicer agrees to present, on behalf of itself, the
Depositor, and the Trustee for the benefit of the Certificateholders, claims
under any such blanket policy.
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(c) With respect to each Mortgage Loan covered by a Primary Insurance
Policy as of the Cut-off Date, the Servicer shall, without any cost to the
Depositor or Trustee, maintain or cause the Mortgagor to maintain in full
force and effect a Primary Insurance Policy insuring that portion of the
Mortgage Loan in excess of 60% of the lesser of (i) the appraised value of the
related Mortgaged Property and (ii) the purchase price paid by the related
Mortgagor for the related Mortgaged Property, and shall pay or shall cause the
Mortgagor to pay, the premium thereon on a timely basis, until the
loan-to-value ratio of such Mortgage Loan is reduced to 55% or until
terminated pursuant to the Homeowners Protection Act of 1998, 12 USC ss.4901,
et seq. or otherwise prohibited by law. In the event that such Primary
Insurance Policy shall be terminated otherwise than required by law, the
Servicer shall obtain from another Qualified Insurer a comparable replacement
policy, with a total coverage equal to the remaining coverage of such
terminated Primary Insurance Policy. If the insurer shall cease to be a
Qualified Insurer, the Servicer shall determine whether recoveries under the
Primary Insurance Policy are jeopardized for reasons related to the financial
condition of such insurer, it being understood that the Servicer shall in no
event have any responsibility or liability for any failure to recover under
the Primary Insurance Policy for such reason. If the Servicer determines that
recoveries are so jeopardized, it shall notify the Mortgagor, if required, and
obtain from another Qualified Insurer a replacement insurance policy. The
Servicer shall not take any action inconsistent with Accepted Servicing
Practices which would result in noncoverage under any applicable Primary
Insurance Policy of any loss which, but for the actions of the Servicer would
have been covered thereunder. In connection with any assumption or
substitution agreement entered into or to be entered into pursuant to Section
3.11, the Servicer shall promptly notify the insurer under the related Primary
Insurance Policy, if any, of such assumption or substitution of liability in
accordance with the terms of such Primary Insurance Policy and shall take all
actions which may be required by such insurer as a condition to the
continuation of coverage under such Primary Insurance Policy. If such Primary
Insurance Policy is terminated as a result of such assumption or substitution
of liability, the Servicer shall obtain a replacement Primary Insurance Policy
as provided above.
With respect to Mortgage Loans covered by a Primary Insurance Policy
(other than the MGIC Policy), the Servicer agrees to effect timely payment of
the premiums on each Primary Insurance Policy, and such costs not otherwise
recoverable shall be recoverable by the Servicer from the related liquidation
proceeds.
In connection with its activities as servicer, the Servicer agrees to
prepare and present, on behalf of itself, the Depositor, the Trustee and the
Certificateholders, claims to the insurer under any Primary Insurance Policy
in a timely fashion in accordance with the terms of such Primary Insurance
Policy and, in this regard, to take such reasonable action as shall be
necessary to permit recovery under any Primary Insurance Policy respecting
defaulted Mortgage Loans. Pursuant to Section 3.06, any amounts collected by
the Servicer under any Primary Insurance Policy shall be deposited in the
related Collection Account, subject to withdrawal pursuant to Section 3.09.
(d) The Servicer shall take all actions necessary in order to maintain or
cause to be maintained the MGIC Policy in full force and effect until this
Agreement is terminated pursuant to Section 9.01, except to the extent of
actions for which the Servicer is responsible under this Section 3.10(d). On
each Distribution Date, the Trustee shall remit to MGIC the MGIC Fee. In
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the event that such MGIC Policy shall be terminated otherwise than required by
law, the Servicer shall use its best efforts to obtain from another Qualified
Insurer a comparable replacement policy, with a total coverage equal to the
remaining coverage of such terminated MGIC Policy and a cost not in excess of
the MGIC Fee. If MGIC shall cease to be a Qualified Insurer, the Servicer
shall use its best efforts to obtain from another Qualified Insurer a
replacement insurance policy in accordance with the preceding sentence. The
Servicer shall be entitled to reimbursement for all reasonable out-of-pocket
expenses incurred in obtaining a replacement insurance policy pursuant to
Section 3.09.
In connection with its activities as servicer, the Servicer agrees to
prepare and present, on behalf of itself, the Depositor, the Trustee and the
Certificateholders, claims to the insurer under the MGIC Policy in a timely
fashion in accordance with the terms of such the MGIC Policy and, in this
regard, to take such reasonable action as shall be necessary to permit
recovery under the MGIC Policy respecting defaulted Mortgage Loans. Pursuant
to Section 3.06, any amounts collected by the Servicer under the MGIC Policy
shall be deposited in the Collection Account, subject to withdrawal pursuant
to Section 3.09. The Servicer shall be responsible for taking all actions
required under the MGIC Policy to cause each MGIC Mortgage Loan serviced by it
to continue to be eligible for coverage under the MGIC Policy, and to maximize
proceeds of any claim thereunder. The Servicer shall be solely responsible for
complying with all reporting and other information requirements under the MGIC
Policy, with respect to all MGIC Mortgage Loans. The Servicer shall not take
any action inconsistent with Accepted Servicing Practices which would result
in noncoverage under the MGIC Policy of any loss which, but for the actions of
the Servicer would have been covered thereunder. In connection with any
assumption or substitution agreement entered into or to be entered into
pursuant to Section 3.11, the Servicer shall promptly notify the insurer under
the MGIC Policy, if any, of such assumption or substitution of liability in
accordance with the terms of the MGIC Policy and shall take all actions which
may be required by such insurer as a condition to the continuation of coverage
under the MGIC Policy.
(e) The Servicer need not obtain the approval of the Trustee prior to
releasing any Insurance Proceeds to the Mortgagor to be applied to the
restoration or repair of the Mortgaged Property if such release is in
accordance with Accepted Servicing Practices. At a minimum, the Servicer shall
comply with the following conditions in connection with any such release of
Insurance Proceeds:
(i) the Servicer shall receive satisfactory independent verification
of completion of repairs and issuance of any required approvals with
respect thereto;
(ii) the Servicer shall take all steps necessary to preserve the
priority of the lien of the Mortgage, including, but not limited to
requiring waivers with respect to mechanics' and materialmen's liens; and
(iii) pending repairs or restoration, the Servicer shall place the
Insurance Proceeds in the related Escrow Account.
If the Trustee is named as an additional loss payee, the Servicer is
hereby empowered to endorse any loss draft issued in respect of such a claim
in the name of the Trustee.
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SECTION 3.11 Enforcement of Due-on-Sale Clauses; Assumption Agreements.
(a) The Servicer shall use its best efforts to enforce any "due-on-sale"
provision contained in any related Mortgage or Mortgage Note and to deny
assumption by the person to whom the Mortgaged Property has been or is about
to be sold whether by absolute conveyance or by contract of sale, and whether
or not the Mortgagor remains liable on the Mortgage and the Mortgage Note.
When the Mortgaged Property has been conveyed by the Mortgagor, the Servicer
shall, to the extent it has knowledge of such conveyance, exercise its rights
to accelerate the maturity of such Mortgage Loan under the "due-on-sale"
clause applicable thereto, provided, however, that the Servicer shall not
exercise such rights if prohibited by law from doing so or if the exercise of
such rights would impair or threaten to impair any recovery under the related
Primary Insurance Policy, if any.
(b) If the Servicer reasonably believes it is unable under applicable law
to enforce such "due-on-sale" clause, the Servicer shall enter into (i) an
assumption and modification agreement with the person to whom such property
has been conveyed, pursuant to which such person becomes liable under the
Mortgage Note and the original Mortgagor remains liable thereon or (ii) in the
event the Servicer is unable under applicable law to require that the original
Mortgagor remain liable under the Mortgage Note, a substitution of liability
agreement with the purchaser of the Mortgaged Property pursuant to which the
original Mortgagor is released from liability and the purchaser of the
Mortgaged Property is substituted as Mortgagor and becomes liable under the
Mortgage Note. Notwithstanding the foregoing, the Servicer shall not be deemed
to be in default under this Section by reason of any transfer or assumption
which the Servicer reasonably believes it is restricted by law from
preventing, for any reason whatsoever. In connection with any such assumption,
no material term of the Mortgage Note, including without limitation, the
Mortgage Rate borne by the related Mortgage Note, the term of the Mortgage
Loan or the outstanding principal amount of the Mortgage Loan shall be
changed.
(c) To the extent that any Mortgage Loan is assumable, the Servicer shall
inquire diligently into the creditworthiness of the proposed transferee, and
shall use the underwriting criteria for approving the credit of the proposed
transferee which are used by FNMA with respect to underwriting mortgage loans
of the same type as the Mortgage Loans. If the credit of the proposed
transferee does not meet such underwriting criteria, the Servicer diligently
shall, to the extent permitted by the Mortgage or the Mortgage Note and by
applicable law, accelerate the maturity of the Mortgage Loan.
(d) Subject to the Servicer's duty to enforce any due-on-sale clause to
the extent set forth in this Section 3.11, 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 Mortgage Loan, the 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
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assumptions or the transfer of the Mortgaged Property to such Person. In
connection with any such assumption, no material term of the Mortgage Note may
be changed. Together with each such substitution, assumption or other
agreement or instrument delivered to the Trustee for execution by it, the
Servicer shall deliver an Officer's Certificate signed by a Servicing Officer
stating that the requirements of this subsection have been met in connection
therewith. The Servicer shall notify the Trustee that any such substitution or
assumption agreement has been completed by forwarding to the Trustee 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 the Servicer for entering into an assumption or substitution of liability
agreement will be retained by the Servicer as additional servicing
compensation.
The Trust Fund shall treat the rights of the Class A-IO Certificates, in
the portion of the Trust Fund consisting of the Prepayment Premium, as the
beneficial interest in a grantor trust and not as an interest in or an
obligation of the Subsidiary REMIC or the Master REMIC for federal income tax
purposes.
SECTION 3.12 Realization Upon Defaulted Mortgage Loans; Repurchase of
Certain Mortgage Loans.
(a) The 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 Servicer shall
take such action as (i) the Servicer would take under similar circumstances
with respect to a similar mortgage loan held for its own account for
investment, (ii) shall be consistent with Accepted Servicing Practices, (iii)
the Servicer shall determine consistently with Accepted Servicing Practices to
be in the best interest of the Depositor, Trustee and Certificateholders, and
(iv) is consistent with the requirements of the insurer under any Required
Insurance Policy; provided, however, that the 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 Collection Account). The Servicer shall be responsible for all other
costs and expenses incurred by it in any such proceedings; provided, however,
that it shall be entitled to reimbursement thereof from the Liquidation
Proceeds with respect to the related Mortgaged Property or otherwise pursuant
to Section 3.08(a).
Notwithstanding anything to the contrary contained in this Agreement, in
connection with a foreclosure or acceptance of a deed in lieu of foreclosure,
in the event the Servicer has reasonable cause to believe that a Mortgaged
Property is contaminated by hazardous or toxic substances or wastes, or if the
Trustee otherwise requests, an environmental inspection or review of such
Mortgaged Property conducted by a qualified inspector shall be arranged for by
the Servicer. Upon completion of the inspection, the Servicer shall promptly
provide the Trustee with a written report of environmental inspection.
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In the event the environmental inspection report indicates that the
Mortgaged Property is contaminated by hazardous or toxic substances or wastes,
the Servicer shall not proceed with foreclosure or acceptance of a deed in
lieu of foreclosure if the estimated costs of the environmental clean up, as
estimated in the environmental inspection report, together with the Servicing
Advances made by the Servicer and the estimated costs of foreclosure or
acceptance of a deed in lieu of foreclosure exceeds the estimated value of the
Mortgaged Property. If however, the aggregate of such clean up and foreclosure
costs and Servicing Advances as estimated in the environmental inspection
report are less than or equal to the estimated value of the Mortgaged
Property, then the Servicer may, in its reasonable judgment and in accordance
with Accepted Servicing Practices, choose to proceed with foreclosure or
acceptance of a deed in lieu of foreclosure and the Servicer shall be
reimbursed for all reasonable costs associated with such foreclosure or
acceptance of a deed in lieu of foreclosure and any related environmental
clean up costs, as applicable, from the related Liquidation Proceeds, or if
the Liquidation Proceeds are insufficient to fully reimburse the Servicer, the
Servicer shall be entitled to be reimbursed from amounts in the related
Collection Account pursuant to Section 3.08(a) hereof. In the event the
Servicer does not proceed with foreclosure or acceptance of a deed in lieu of
foreclosure pursuant to the first sentence of this paragraph, the Servicer
shall be reimbursed for all Servicing Advances made with respect to the
related Mortgaged Property from the related Collection Account pursuant to
Section 3.08(a) hereof, and the Servicer shall have no further obligation to
service such Mortgage Loan under the provisions of this Agreement.
(b) 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 its 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 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 Servicer shall in accordance with Accepted Servicing Practices
manage, conserve, protect and operate each REO Property for the purpose of its
prompt disposition and sale. The Servicer, either itself or through an agent
selected by the Servicer, shall manage, conserve, protect and operate the REO
Property in the same manner that it manages, conserves, protects and operates
other foreclosed property for its own account, and in the same manner that
similar property in the same locality as the REO Property is managed. The
Servicer shall furnish to the Trustee on or before each Distribution Date a
statement with respect to any REO Property covering the operation of such REO
Property for the previous calendar month and such other information as the
Trustee shall reasonably request and which is necessary to enable the Trustee
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 Collection Account no later than the close of business on each
Determination Date. The Servicer shall perform the tax reporting and
withholding required by Sections 1445 and 6050J of the Code with respect to
foreclosures and abandonments, the tax reporting required by Section 6050H of
the Code with respect to the receipt of mortgage interest from individuals and
any tax reporting required by Section 6050P of the Code with respect to the
cancellation of indebtedness by certain financial entities, by preparing such
tax and information returns as may be required for filing.
To the extent consistent with Accepted Servicing Practices, the Servicer
shall also maintain on each REO Property fire and hazard insurance with
extended coverage in amount which is equal to the outstanding principal
balance of the related Mortgage Loan (as reduced by
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any amount applied as a reduction of principal at the time of acquisition of
the REO Property), liability insurance and, to the extent required and
available under the Flood Disaster Protection Act of 1973, as amended, flood
insurance in the amount required above.
(c) 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 the end of the calendar year of its acquisition by the Trust
Fund unless (i) the Trustee shall have been supplied with an Opinion of
Counsel 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 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 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. 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 any REMIC hereunder 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.
In the event of a default on a Mortgage Loan one or more of whose obligor
is not a United States Person, as that term is defined in Section 7701(a)(30)
of the Code, in connection with any foreclosure or acquisition of a deed in
lieu of foreclosure (together, "foreclosure") in respect of such Mortgage
Loan, the Servicer will cause compliance with the provisions of Treasury
Regulation Section 1.1445-2(d)(3) (or any successor thereto) necessary to
assure that no withholding tax obligation arises with respect to the proceeds
of such foreclosure except to the extent, if any, that proceeds of such
foreclosure are required to be remitted to the obligors on such Mortgage Loan.
(d) The decision of the Servicer to foreclose on a defaulted Mortgage
Loan shall be subject to a determination by the 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 REO Properties, net
of reimbursement to the Servicer for expenses incurred (including any property
or other taxes) in connection with such management and net of applicable
accrued and unpaid Servicing Fees, and unreimbursed Advances and Servicing
Advances, shall be applied to the payment of principal of and interest on the
related 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 this Agreement, to be payments on account of principal and
interest on the related Mortgage Notes and shall be deposited into the related
Collection Account. To the extent the net income received during any calendar
month is in excess of the amount attributable to amortizing principal and
accrued interest at the related Mortgage Rate on the related Mortgage
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Loan for such calendar month, such excess shall be considered to be a partial
prepayment of principal of the related Mortgage Loan.
(e) The proceeds from any liquidation of a Mortgage Loan, as well as any
income from an REO Property, will be applied in the following order of
priority: first, to reimburse the Servicer for any related unreimbursed
Servicing Advances and Servicing Fees; second, to reimburse the Servicer for
any unreimbursed Advances; third, to reimburse the related Collection Account
for any Nonrecoverable Advances (or portions thereof) that were previously
withdrawn by the Servicer pursuant to Section 3.09(a)(iii) that related to
such Mortgage Loan; fourth, to accrued and unpaid interest (to the extent no
Advance has been made for such amount or any such Advance has been reimbursed)
on the Mortgage Loan or related REO Property, at the per annum rate equal to
the related Mortgage Rate reduced by the Servicing Fee Rate to the Due Date
occurring in the month in which such amounts are required to be distributed;
and fifth, as a recovery of principal of the Mortgage Loan. Excess Proceeds,
if any, from the liquidation of a Liquidation Mortgage Loan will be retained
by the Servicer as additional servicing compensation pursuant to Section 3.15.
(f) The Servicer may, at its option, enter into a special servicing
agreement with an unaffiliated Holder of the Class X Certificate, subject to
each Rating Agency's acknowledgment that the Ratings of the Certificates in
effect immediately prior to the entering into of such agreement would not be
qualified, downgraded or withdrawn and the Certificates would not be placed on
credit review status (except for possible upgrading) as a result of such
agreement. Any such agreement may contain provisions whereby such Holder may
(i) instruct the Servicer to commence or delay foreclosure proceedings with
respect to delinquent Mortgage Loans serviced by it and will contain
provisions for the deposit of cash with the Servicer by the Holder that would
be available for distribution to Certificateholders if Liquidation Proceeds
are less than they otherwise may have been had the Servicer acted in
accordance with its normal procedures, (ii) purchase delinquent Mortgage Loans
serviced by the Servicer from the Trust Fund immediately prior to the
commencement of foreclosure proceedings at a price equal to the Repurchase
Price, and/or (iii) assume all of the servicing rights and obligations with
respect to delinquent Mortgage Loans serviced by the Servicer so long as such
Holder (A) meets the requirements for a Subservicer set forth in Section
3.02(a), and (B) will service such Mortgage Loans in accordance with this
Agreement.
(g) Vesta, at its option, may (but is not obligated to) purchase from the
Trust Fund any Mortgage Loan which is 90 or more days delinquent. If it elects
to make any such purchase, Vesta shall purchase such Mortgage Loan with its
own funds at a price equal to the Repurchase Price.
SECTION 3.13 Trustee to Cooperate; Release of Mortgage Files.
Upon the payment in full of any Mortgage Loan, or the receipt by the
Servicer of a notification that payment in full will be escrowed in a manner
customary for such purposes, the Servicer will immediately notify the
Custodian by delivering, or causing to be delivered a "Request for Release"
substantially in the form of Exhibit M. Upon receipt of such request, the
Custodian shall within four Business Days release the related Mortgage File to
the Servicer, and the Trustee shall within four Business Days of the
Servicer's direction execute and deliver to the
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Servicer the request for reconveyance, deed of reconveyance or release or
satisfaction of mortgage or such instrument releasing the lien of the Mortgage
in each case provided by the Servicer, together with the Mortgage Note with
written evidence of cancellation thereon. The Servicer shall execute lien
releases under Power of Attorney from the Trustee. Expenses incurred in
connection with any instrument of satisfaction or deed of reconveyance shall
be chargeable to the related Mortgagor. From time to time and as shall be
appropriate for the servicing or foreclosure of any Mortgage Loan, including
for such purpose, collection under any policy of flood insurance, any fidelity
bond or errors or omissions policy, or for the purposes of effecting a partial
release of any Mortgaged Property from the lien of the Mortgage or the making
of any corrections to the Mortgage Note or the Mortgage or any of the other
documents included in the Mortgage File, the Trustee shall, within three
Business Days of delivery to the Trustee of a Request for Release in the form
of Exhibit M signed by a Servicing Officer, release or cause the Custodian to
release the Mortgage File to the Servicer. Subject to the further limitations
set forth below, the Servicer shall cause the Mortgage File or documents so
released to be returned to the Trustee or the Custodian, as applicable, when
the need therefor by the Servicer no longer exists, unless the Mortgage Loan
is liquidated and the proceeds thereof are deposited in the related Collection
Account, in which case the Servicer shall deliver to the Trustee a Request for
Release in the form of Exhibit M, signed by a Servicing Officer.
If the Servicer at any time seeks to initiate a foreclosure proceeding in
respect of any Mortgaged Property as authorized by this Agreement, the
Servicer shall deliver or cause to be delivered to the Trustee, for signature,
as appropriate, any court pleadings, requests for trustee's sale or other
documents necessary to effectuate such foreclosure or any legal action brought
to obtain judgment against the Mortgagor on the Mortgage Note or the Mortgage
or to obtain a deficiency judgment or to enforce any other remedies or rights
provided by the Mortgage Note or the Mortgage or otherwise available at law or
in equity.
SECTION 3.14 Documents, Records and Funds in Possession of the Servicer
to be Held for the Trustee.
Notwithstanding any other provisions of this Agreement, the Servicer
shall transmit to the Custodian on behalf of the Trustee as required by this
Agreement all documents and instruments in respect of a Mortgage Loan coming
into the possession of the Servicer from time to time required to be delivered
to the Trustee pursuant to the terms hereof and shall account fully to the
Trustee for any funds received by the Servicer or which otherwise are
collected by the Servicer as Liquidation Proceeds or Insurance Proceeds in
respect of any Mortgage Loan. All Mortgage Files and funds collected or held
by, or under the control of, the Servicer in respect of any Mortgage Loans,
whether from the collection of principal and interest payments or from
Liquidation Proceeds, including but not limited to, any funds on deposit in a
Collection Account, shall be held by the 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. The Servicer
also agrees that it shall not create, incur or subject any Mortgage File or
any funds that are deposited in the related Collection Account, Certificate
Account or any related Escrow Account, or any funds that otherwise are or may
become due or payable to the Trustee for the benefit of the
Certificateholders, to any claim, lien, security interest, judgment, levy,
writ of attachment or other encumbrance, or assert by legal action or
otherwise any claim or right of setoff against any Mortgage File or any funds
collected on, or in connection with, a Mortgage
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Loan, except, however, that the Servicer shall be entitled to set off against
and deduct from any such funds any amounts that are properly due and payable
to the Servicer under this Agreement.
SECTION 3.15 Servicing Fee.
As compensation for its services hereunder, the Servicer shall be
entitled to withdraw from the applicable Collection Account in accordance with
Section 3.09(a) or to retain from interest payments on the related Mortgage
Loans the amount of the Servicing Fee for each Mortgage Loan, less any amounts
in respect of its Servicing Fee payable by the Servicer pursuant to Section
3.06(c)(vii). In connection with the servicing of any Special Serviced
Mortgage Loan, the Special Servicer shall receive the Servicing Fee for each
such Mortgage Loan as its compensation.
Additional servicing compensation in the form of Ancillary Income shall
be retained by the Servicer. The Servicer shall be required to pay all
expenses incurred by it in connection with its servicing activities hereunder
(including the payment of any expenses incurred in connection with any
Subservicing Agreement entered into pursuant to Section 3.02 and the payment
of any premiums for hazard insurance and any Primary Insurance Policy, and
maintenance of the other forms of insurance coverage required by this
Agreement other than the MGIC Policy) and shall not be entitled to
reimbursement thereof except as specifically provided for in this Agreement.
SECTION 3.16 Access to Certain Documentation.
The Servicer shall provide to the OTS and the FDIC and to comparable
regulatory authorities supervising Holders of Subordinate Certificates and the
examiners and supervisory agents of the OTS, the FDIC and such other
authorities, access to the documentation regarding the related Mortgage Loans
required by applicable regulations of the OTS and the FDIC. Such access shall
be afforded without charge, but only upon reasonable and prior written request
and during normal business hours at the offices designated by the Servicer.
Nothing in this Section shall limit the obligation of the Servicer to observe
any applicable law prohibiting disclosure of information regarding the
Mortgagors and the failure of the Servicer to provide access as provided in
this Section as a result of such obligation shall not constitute a breach of
this Section.
SECTION 3.17 Annual Statement as to Compliance.
The Servicer shall deliver to the Depositor, the Rating Agencies and the
Trustee on or before 120 days after the end of the Servicer's fiscal year,
commencing in its 2002 fiscal year, an Officer's Certificate stating, as to
the signer thereof, that (i) a review of the activities of the Servicer during
the preceding calendar year and of the performance of the Servicer under this
Agreement has been made under such officer's supervision, and (ii) to the best
of such officer's knowledge, based on such review, the Servicer has fulfilled
all its obligations under this Agreement throughout such year, or, if there
has been a default in the fulfillment of any such obligation, specifying each
such default known to such officer and the nature and status thereof and the
action being taken by the Servicer to cure such default.
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SECTION 3.18 Annual Independent Public Accountants' Servicing Statement;
Financial Statements.
On or before 120 days after the end of the Servicer's fiscal year,
commencing in its 2002 fiscal year, the Servicer, at its expense, shall cause
a nationally or regionally recognized firm of independent public accountants
(who may also render other services to the Servicer, the Seller or any
affiliate thereof) which is a member of the American Institute of Certified
Public Accountants to furnish a statement to the Trustee and the Depositor to
the effect that with respect to the Servicer, such firm has examined certain
documents and records relating to the servicing of mortgage loans which the
Servicer is servicing, including the related Mortgage Loans, and that, on the
basis of such examination, conducted substantially in compliance with the
Uniform Single Attestation Program for Mortgage Bankers or the Audit Guide for
HUD Approved Title II Approved Mortgagees and Loan Correspondent Programs,
nothing has come to their attention which would indicate that such servicing
has not been conducted in compliance with Accepted Servicing Practices, except
for (a) such exceptions as such firm shall believe to be immaterial, and (b)
such other exceptions as shall be set forth in such statement. In rendering
such statement, such firm may rely, as to matters relating to direct servicing
of mortgage loans by Subservicers, upon comparable statements for examinations
conducted substantially in compliance with the Uniform Single Attestation
Program for Mortgage Bankers or the Audit Guide for HUD Approved Title II
Approved Mortgagees and Loan Correspondent Programs (rendered within one year
of such statement) of independent public accountants with respect to the
related Subservicer. Copies of such statement shall be provided by the Trustee
to any Certificateholder upon request at the Servicer's expense, provided such
statement is delivered by the Servicer to the Trustee.
SECTION 3.19 Maintenance of Fidelity Bond and Errors and Omissions
Insurance.
The Servicer shall maintain with responsible companies, at its own
expense, a blanket Fidelity Bond and an Errors and Omissions Insurance Policy,
with broad coverage on all officers, employees or other persons acting in any
capacity requiring such persons to handle funds, money, documents or papers
relating to the related Mortgage Loans ("Servicer Employees"). Any such
Fidelity Bond and Errors and Omissions Insurance Policy shall be in the form
of the Financial Institution Bond Form 22 - Fidelity Bond American
International Specialty Lines Insurance Policy Form ("5713 5/93") Mortgage
Banker Broker E&O and shall protect and insure the Servicer against losses,
including forgery, theft, embezzlement, fraud, errors and omissions and
negligent acts of the Servicer Employees. Such Fidelity Bond and Errors and
Omissions Insurance Policy also shall protect and insure the Servicer against
losses in connection with the release or satisfaction of a related Mortgage
Loan without having obtained payment in full of the indebtedness secured
thereby. No provision of this Section 3.19 requiring such Fidelity Bond and
Errors and Omissions Insurance Policy shall diminish or relieve the Servicer
from its duties and obligations as set forth in this Agreement. The minimum
coverage under any such bond and insurance policy shall be at least equal to
the corresponding amounts required by FNMA.
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SECTION 3.20 Prepayment Premiums.
Notwithstanding anything in this Agreement to the contrary, in the event
of a Principal Prepayment of a Mortgage Loan, the Servicer may not waive any
Prepayment Premium or portion thereof required by the terms of the related
Mortgage Note unless (i) the Servicer determines that such waiver would
maximize recovery of Liquidation Proceeds for such Mortgage Loan, taking into
account the value of such Prepayment Premium, or (ii) (A) the enforceability
thereof is limited (1) by bankruptcy, insolvency, moratorium, receivership, or
other similar law relating to creditors' rights generally or (2) due to
acceleration in connection with a foreclosure or other involuntary payment, or
(B) the enforceability is otherwise limited or prohibited by applicable law.
For the avoidance of doubt, the Servicer may waive a Prepayment Premium in
connection with a short sale or short payoff on a defaulted Mortgage Loan. If
the Servicer has waived all or a portion of a Prepayment Premium relating to a
Principal Prepayment, other than as provided above, the Servicer shall deliver
to the Trustee no later than the next succeeding Servicer Remittance Date, for
deposit into the Certificate Account the amount of such Prepayment Premium (or
such portion thereof as had been waived) for distribution in accordance with
the terms of this Agreement. If the Servicer has waived all or a portion of a
Prepayment Premium for any reason, it shall promptly notify the Trustee
thereof and shall include such information in any monthly reports it provides
the Trustee.
SECTION 3.21 Duties of the Loss Mitigation Advisor.
For and on behalf of the Depositor, the Loss Mitigation Advisor shall
provide reports and recommendations as to loss mitigation activities
concerning Mortgage Loans that are past due, as to which there has been
commencement of foreclosure, as to which there has been forbearance in
exercise of remedies which are in default, as to which any obligor is the
subject of bankruptcy, receivership, or an arrangement of creditors, or which
have become REO Properties. Such reports and recommendations will be based
upon information provided pursuant to Loss Mitigation Advisory Agreement. The
Loss Mitigation Advisor shall look solely to the Servicer for all information
and data (including loss and delinquency information and data) and loan level
information and data relating to the servicing of the Mortgage Loans.
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ARTICLE IV
DISTRIBUTIONS AND
ADVANCES BY THE SERVICER
SECTION 4.01 Advances by the Servicer.
The Servicer shall deposit in the related Collection Account at the time
described below an amount equal to (i) with respect to the Mortgage Loans
other than the Simple Interest Mortgage Loans, all Scheduled Payments (with
interest at the Mortgage Rate less the Servicing Fee Rate and Loss Mitigation
Advisor Fee Rate) which were due on the related Mortgage Loans during the
applicable Due Period and (ii) with respect to the Simple Interest Mortgage
Loans, 30 day's interest on each such Mortgage Loan, less the Servicing Fee,
which were delinquent at the close of business on the immediately preceding
Determination Date; provided however, that with respect to any Balloon Loan
that is delinquent on its maturity date, the Servicer will not be required to
advance the related balloon payment but will be required to continue to make
advances in accordance with this Section 4.01 with respect to such Balloon
Loan in an amount equal to an assumed scheduled payment that would otherwise
be due based on the original amortization schedule for that Mortgage Loan
(with interest at the Mortgage Rate less the Servicing Fee Rate). The
Servicer's obligation to make such Advances as to any related Mortgage Loan
will continue through the last Scheduled Payment due prior to the payment in
full of such Mortgage Loan, 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 the terms of this
Agreement.
To the extent required by Accepted Servicing Practices, the Servicer
shall be obligated to make Advances with respect to those Mortgage Loans
serviced by it in accordance with the provisions of this Agreement; provided
however, that such obligation with respect to any related Mortgage Loan shall
cease if the Servicer determines, in its sole discretion, that Advances with
respect to such Mortgage Loan are Nonrecoverable Advances. In the event that
the Servicer determines that any such advances are Nonrecoverable Advances,
the Servicer shall provide the Trustee with a certificate signed by a
Servicing Officer evidencing such determination.
If an Advance is required to be made hereunder, the Servicer shall on the
applicable Servicer Remittance Date immediately following the Determination
Date either (i) deposit in the related Collection Account from its own funds
an amount equal to such Advance, (ii) cause to be made an appropriate entry in
the records of such Collection Account that funds in such account being held
for future distribution or withdrawal have been, as permitted by this Section
4.01, used by the Servicer to make such Advance or (iii) make Advances in the
form of any combination of clauses (i) and (ii) aggregating the amount of such
Advance. Any such funds being held in a Collection Account for future
distribution and so used shall be replaced by the Servicer from its own funds
by deposit in such Collection Account on or before any future Distribution
Date in which such funds would be due.
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SECTION 4.02 Priorities of Distribution.
(a) On each Distribution Date, the Trustee shall distribute the Interest
Remittance Amount for such date in the following order of priority:
A. to MGIC, the MGIC Premium for such Distribution Date;
B. to the Trustee, the Trustee Fee for such Distribution Date;
C. to FSA, the FSA Premium for such Distribution Date;
D. to the Senior Certificates, pro rata, Current Interest and any
Carryforward Interest for each such Class and such Distribution
Date;
E. to FSA, any FSA Reimbursement Amounts;
F. to the Class M-1 Certificates, Current Interest and any Carryforward
Interest for such Class and such Distribution Date;
G. to the Class M-2 Certificates, Current Interest and any Carryforward
Interest for such Class and such Distribution Date;
H. to the Class B Certificates, Current Interest and any Carryforward
Interest for such Class and such Distribution Date; and
I. for application as part of Monthly Excess Cashflow for such
Distribution Date, as provided in Section 4.02(d), any such Interest
Remittance Amount remaining for such Distribution Date.
(b) On each Distribution Date (A) prior to the Stepdown Date or (B) with
respect to which a Trigger Event has occurred, the Trustee shall distribute
the Principal Payment Amount for such date in the following order of priority:
A. first to the Class R Certificates, until the Class Principal Balance
thereof is reduced to zero and then concurrently to the Class A-1
and Class A-2 Certificates, pro rata based on Class Principal
Balances, until the Class Principal Balance of each such Class has
been reduced to zero;
B. to FSA, any FSA Reimbursement Amounts, to the extent not otherwise
paid pursuant to Section 4.02(a);
C. to the Class M-1 Certificates, until the Class Principal Balance of
such Class has been reduced to zero;
D. to the Class M-2 Certificates, until the Class Principal Balance of
such Class has been reduced to zero;
E. to the Class B Certificates, until the Class Principal Balance of
such Class has been reduced to zero; and
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F. for application as part of Monthly Excess Cashflow for such
Distribution Date, as provided in Section 4.02(d), any Principal
Payment Amount remaining for such Distribution Date.
(c) On each Distribution Date (A) on or after the Stepdown Date and (b)
with respect to which a Trigger Event has not occurred, the Trustee shall
distribute the Principal Payment Amount for such date in the following order
of priority:
A. concurrently, to the Class A-1 and Class A-2 Certificates, the
Senior Principal Payment Amount for such Distribution Date, pro rata
based on Class Principal Balances, until the Class Principal Balance
of each such Class has been reduced to zero;
B. to FSA, any FSA Reimbursement Amounts, to the extent not otherwise
paid pursuant to Section 4.02(a) and Section 4.02(b).
C. to the Class M-1 Certificates, the M-1 Principal Payment Amount for
such Distribution Date, until the Class Principal Balance of such
Class has been reduced to zero;
D. to the Class M-2 Certificates, the M-2 Principal Payment Amount for
such Distribution Date, until the Class Principal Balance of such
Class has been reduced to zero;
E. to the Class B Certificates, the B Principal Payment Amount for such
Distribution Date, until the Class Principal Balance of such Class
has been reduced to zero; and
F. for application as part of Monthly Excess Cashflow for such
Distribution Date, as provided in Section 4.02(d), any Principal
Payment Amount remaining for such Distribution Date.
(d) On each Distribution Date, the Trustee shall distribute the Monthly
Excess Cashflow for such date in the following order of priority:
A. (I) beginning with the October 2001 Distribution Date, until the
aggregate Class Principal Balance of the Offered Certificates
equals the Aggregate Collateral Balance for such Distribution
Date minus the Targeted Overcollateralization Amount for such
date, on each Distribution Date (a) prior to the Stepdown Date
or (b) with respect to which a Trigger Event has occurred in
the following order of priority:
(aa) first to the Class R and then, concurrently, to the Class
A-l and Class A-2 Certificates, pro rata, based on Class
Principal Balance, until the Class Principal Balance of
each such Class has been reduced to zero;
(bb) to the Class M-1 Certificates, until the Class Principal
Balance of such Class has been reduced to zero;
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(cc) to the Class M-2 Certificates, until the Class Principal
Balance of such Class has been reduced to zero; and
(dd) to the Class B Certificates, until the Class Principal
Balance of such Class has been reduced to zero;
(II) on each Distribution Date on or after the Stepdown Date and
with respect to which a Trigger Event has not occurred, to fund
any principal distributions required to be made on such
Distribution Date pursuant to Section 4.01(c), after giving
effect to the distribution of the Principal Payment Amount for
such Distribution Date, in accordance with the priorities set
forth therein;
B. to FSA, any Reimbursement Amounts, to the extent not otherwise paid
pursuant to Sections 4.02(a), 4.02(b) or 4.02(c);
C. to the Class M-1 Certificates, any Deferred Amount for such Class,
with interest thereon at the Pass-Through Rate;
D. to the Class M-2 Certificates, any Deferred Amount for such Class,
with interest thereon at the Pass-Through Rate;
E. to the Class B Certificates, any Deferred Amount for such Class,
with interest thereon at the Pass-Through Rate;
F. to each of the Class A-1 and Class A-2 Certificates, pro rata, any
applicable Basis Risk Shortfall for such Classes;
G. to the Class M-1 Certificates, any applicable Basis Risk Shortfall
for such Class;
H. to the Class M-2 Certificates, any applicable Basis Risk Shortfall
for such Class;
I. to the Class B Certificates, any applicable Basis Risk Shortfall for
such Class;
J. to the Basis Risk Reserve Fund, any amounts due to the Class X
Certificateholders and required to be deposited in the Basis Risk
Reserve Fund;
K. to the Class X Certificates, the Class X Distributable Amount for
such Distribution Date together with amounts withdrawn from the
Basis Risk Reserve Fund for distribution to the Class X Certificates
pursuant to Section 4.06(b), (c) and (d); and
L. to the Class R Certificate, any remaining amount.
(e) On each Distribution Date, the Trustee shall distribute to the Holder
of the Class A-IO Certificates, the aggregate of all Prepayment Premiums
collected during the preceding Prepayment Period.
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SECTION 4.03 Allocation of Losses.
(a) On each Distribution Date, the Trustee shall determine the total of
the Applied Loss Amount, if any, for such Distribution Date. The Applied Loss
Amount for any Distribution Date shall be applied by reducing the Class
Principal Balance of each Class of Subordinate Certificates beginning with the
Class of Subordinate Certificates then outstanding with the lowest relative
payment priority, in each case until the respective Class Principal Balance
thereof is reduced to zero. Any Applied Loss Amount allocated to a Class of
Subordinate Certificates shall be allocated among the Subordinate Certificates
of such Class in proportion to their respective Percentage Interests.
SECTION 4.04 Monthly Statements to Certificateholders.
(a) Not later than each Distribution Date, the Trustee shall prepare and
cause to be forwarded by first class mail to each Certificateholder, the
Servicer, the Depositor and each Rating Agency, based on the information
provided by the Servicer a statement setting forth with respect to the related
distribution:
(i) the amount thereof allocable to principal, indicating the
portion thereof attributable to Scheduled Payments and Principal
Prepayments;
(ii) the amount thereof allocable to interest or any Carryforward
Interest included in such distribution;
(iii) if the distribution to the Holders of such Class of
Certificates is less than the full amount that would be distributable to
such Holders if there were sufficient funds available therefor, the
amount of the shortfall and the allocation thereof as between principal
and interest;
(iv) the Class Principal Balance of each Class of Certificates after
giving effect to the distribution of principal on such Distribution Date;
(v) the Aggregate Collateral Balance and the Aggregate Balance for
such Distribution Date;
(vi) the Overcollateralization Amount for such Distribution Date;
(vii) the amount of the Servicing Fees, the Trustee Fee, the Loss
Mitigation Advisor Fee, the FSA Premium and MGIC Fees and any other
mortgage insurance fees, if applicable, with respect to such Distribution
Date;
(viii) the Pass-Through Rate for each Class of LIBOR Certificates
with respect to such Distribution Date and the Pass-Through Rate for the
Class A-IO Certificates;
(ix) the amount of Advances included in the distribution on such
Distribution Date and the aggregate amount of Advances outstanding as of
the last day of the calendar month preceding such Distribution Date;
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(x) the number and aggregate principal amounts of Mortgage Loans in
foreclosure, in bankruptcy or which are delinquent (with a notation
indicating which Mortgage Loans, if any, are in foreclosure or
bankruptcy) (1) 30 to 59 days, (2) 60 to 89 days and (3) 90 or more days,
as of the close of business on the last day of the calendar month
preceding such Distribution Date, assuming twelve, thirty day months;
(xi) the number and aggregate principal amounts of Mortgage Loans
with respect to which Prepayment Premiums were collected and the
aggregate amount of such Prepayment Premiums;
(xii) the Rolling Three Month Delinquency Rate for such Distribution
Date;
(xiii) the total number and principal balance of any REO Properties
(and market value, if available) as of the last day of the calendar month
preceding such Distribution Date;
(xiv) the aggregate amount of Realized Losses incurred during the
preceding calendar month and aggregate Realized Losses included in such
distribution;
(xv) the amount on deposit in the Prefunding Account (including
subsequent transfer amounts or amounts included in the Principal
Remittance Amount on November 25, 2001);
(xvi) the weighted average term to maturity of the Mortgage Loans as
of the close of business on the last day of the calendar month preceding
such Distribution Date; and
(xvii) the number and principal amount of claims submitted and
claims paid under the MGIC Policy during the preceding calendar month and
the number and principal amount of claims submitted and claims paid under
the MGIC Policy as of the last day of the calendar month preceding such
Distribution Date;
(xviii) the portion of any distribution to the Class A-2
Certificateholders constituting an Insured Payment for such Distribution
Date;
(xix) the amount on deposit in the Capitalized Interest Account
(including a breakdown of amounts required and released for the calendar
month preceding such Distribution Date); and
(xx) the gross weighted average coupon of the Mortgage Loans as of
the first date of the applicable period for such Distribution Date.
The Trustee's responsibility for disbursing the above information to the
Certificateholders is limited to the availability, timeliness and accuracy of
the information derived from the Servicer.
On each Distribution Date, the Trustee shall provide Bloomberg Financial
Markets, L.P. ("Bloomberg") CUSIP Level Factors for each Class of Offered
Certificates as of such
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Distribution Date, using a format and media mutually acceptable to the Trustee
and Bloomberg. In connection with providing the information specified in this
Section 4.04 to Bloomberg, the Trustee and any director, officer, employee or
agent of the Trustee shall be indemnified and held harmless by DLJMC, to the
extent, in the manner and subject to the limitations provided in Section 8.05.
The Trustee will also make the monthly statements to Certificateholders
available each month to each party referred to in this Section 4.04(a) via the
Trustee's website. The Trustee's website can be accessed at
xxxx://xxx.xxxxxx.xxx/xxx or at such other site as the Trustee may designate
from time to time. The Trustee may fully rely upon and shall have no liability
with respect to information provided by the Servicer.
(b) Upon request, within a reasonable period of time after the end of
each calendar year, the Trustee shall cause to be furnished to each Person who
at any time during the calendar year was a Certificateholder, a statement
containing the information set forth in clauses (a)(i), (a)(ii) and (a)(vii)
of this Section 4.04 aggregated for such calendar year or applicable portion
thereof during which such Person was a Certificateholder. Such obligation of
the Trustee shall be deemed to have been satisfied to the extent that
substantially comparable information shall be provided by the Trustee pursuant
to any requirements of the Code as from time to time in effect.
SECTION 4.05 Servicer to Cooperate.
The Servicer shall provide to the Trustee information which is mutually
agreeable to the Trustee and the Servicer with respect to each Mortgage Loan
serviced by the Servicer no later than the Servicer Remittance Date necessary
to enable the Trustee to perform its distribution, accounting and reporting
requirements hereunder.
SECTION 4.06 Basis Risk Reserve Fund.
(a) On the Closing Date, the Trustee shall establish and maintain in its
name, in trust for the benefit of the Holders of the Certificates, the Basis
Risk Reserve Fund. The Basis Risk Reserve Fund shall be an Eligible Account,
and funds on deposit therein shall be held separate and apart from, and shall
not be commingled with, any other moneys, including without limitation, other
moneys held by the Trustee pursuant to this Agreement.
(b) On the Closing Date, $5,000 will be deposited by the Depositor into
the Basis Risk Reserve Fund. On each Distribution Date, the Trustee shall
transfer from the Certificate Account to the Basis Risk Reserve Fund pursuant
to Section 4.02(d)J. the Required Basis Risk Reserve Fund Amount less the
amount of funds on deposit in the Basis Risk Reserve Fund prior to deposits
thereto on such Distribution Date. Amounts on deposit in the Basis Risk
Reserve Fund can be withdrawn by the Trustee in connection with any
Distribution Date to fund the amounts required to be distributed to holders of
the Offered Certificates pursuant to Sections 4.02(d) F. through I. to the
extent Monthly Excess Cashflow on such date is insufficient to make such
payments. On any Distribution Date, any amounts on deposit in the Basis Risk
Reserve Fund in excess of the Required Basis Risk Reserve Fund Amount shall be
distributed to the Class X Certificateholder pursuant to Section 4.02(d)K.
(c) Funds in the Basis Risk Reserve Fund may be invested in Eligible
Investments by the Trustee at the direction of the holders of the Class X
Certificates maturing on or prior to the
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next succeeding Distribution Date. Any net investment earnings on such amounts
shall be payable to the holders of the Class X Certificates. The Class X
Certificates shall evidence ownership of the Basis Risk Reserve Fund for
federal tax purposes and the Holders thereof shall direct the Trustee in
writing as to the investment of amounts therein. In the absence of such
written direction, all funds in the Basis Risk Reserve Fund shall remain
uninvested. The Trustee shall have no liability for losses on investments in
Eligible Investments made pursuant to this Section 4.06(c) (other than as
obligor on any such investments). Upon termination of the Trust Fund, any
amounts remaining in the Basis Risk Reserve Fund shall be distributed to the
Holders of the Class X Certificate in the same manner as if distributed
pursuant to Section 4.02(d)K. hereof.
(d) On the Distribution Date immediately after the Distribution Date on
which the aggregate Class Principal Balance of the LIBOR Certificates equals
zero, any amounts on deposit in the Basis Risk Reserve Fund not payable on the
LIBOR Certificates shall be deposited into the Certificate Account and
distributed to the Holders of the Class X Certificates in the same manner as
if distributed pursuant to Section 4.02(d)K. hereof.
SECTION 4.07 Policy Matters.
(a) As soon as possible, and in no event later than 11:00 a.m., New York
time, on the third Business Day immediately preceding each Distribution Date,
the Trustee shall determine the amount of funds available for such
Distribution Date minus the amount of any FSA Premium, any MGIC Premium and
any Trustee Fee to be paid on such Distribution Date.
If for any Distribution Date the Trustee determines that the funds
available for distribution to the Holders of the Class A-2 Certificates
pursuant to Section 4.02 will be insufficient to pay the Guaranteed
Distribution, the Trustee shall complete a notice in the form set forth as
Exhibit A to the FSA Policy (the "Notice") and shall submit such Notice to the
Fiscal Agent no later than 12:00 noon, New York time, on the third Business
Day preceding such Distribution Date. The Notice shall constitute a claim for
an Insured Payment pursuant to the FSA Policy. Upon receipt of the Insured
Payment, at or prior to the latest time payments of the Insured Payment are to
be made by the FSA pursuant to the FSA Policy, on behalf of the Holders of the
Class A-2 Certificates, the Trustee shall deposit such Insured Payments in the
Distribution Account and shall distribute such Insured Payments only in
accordance with Section 4.02, if applicable.
The Trustee shall receive as attorney-in-fact of each Holder of a Class
A-2 Certificate, any Insured Payment from FSA and disburse the same to each
Holder of a Class A-2 Certificate in accordance with the provisions of Article
IV. Insured Payments disbursed by the Trustee from proceeds of the FSA Policy
shall not be considered payment by the Trust nor shall such payments discharge
the obligation of the Trust with respect to such Class A-2 Certificate, and
FSA shall become the owner of such unpaid amounts due from the Trust in
respect of such Insured Payments as the deemed assignee of such Holder and
shall be entitled to receive the FSA Reimbursement Amount pursuant to Section
4.02. The Trustee hereby agrees on behalf of each Holder of a Class A-2
Certificate for the benefit of FSA that it and they recognize that to the
extent that FSA makes Insured Payments, either directly or indirectly (as by
paying through the
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Trustee), to the Class A-2 Certificateholders, FSA will be entitled to receive
the FSA Reimbursement Amount pursuant to Section 4.02.
It is understood and agreed that the intention of the parties is that FSA
shall not be entitled to reimbursement on any Distribution Date for amounts
previously paid by it unless on such Distribution Date the Holders of the
Class A-2 Certificates shall also have received the full amount of the
Guaranteed Distributions for such Distribution Date.
(b) The Trustee shall comply with the provisions of the FSA Policy with
respect to claims upon the FSA Policy.
(c) At the time of the execution and delivery of this Agreement, the
Trustee shall establish a separate special purpose trust account for the
benefit of Holders of the Class A-2 Certificates referred to herein as the
"FSA Account" and over which the Trustee shall have exclusive control and sole
right of withdrawal. The Trustee shall deposit any Insured Payment made under
the FSA Policy in the FSA Account and thereafter into the Distribution Account
for distribution of such amount only for purposes of payment to Holders of the
Class A-2 Certificates of Guaranteed Distributions for the Class A-2
Certificates for which a claim was made and such amount may not be applied to
satisfy any cost, expenses or liabilities of the Trustee or the Trust. Insured
Payments made under the FSA Policy shall be disbursed by the Trustee to
Holders of the Class A-2 Certificates in the same manner as distributions on
the Holders of the Class A-2 Certificates are made under Section 4.02. It
shall not be necessary for such distributions to be made by checks or wire
transfers separate from the check or wire transfer used to pay Guaranteed
Distributions with other funds available to make such distributions. However,
the amount of any Insured Payments made on the Class A-2 Certificates to be
paid from funds transferred from the FSA Account shall be noted in the
Certificate Register and in the statements to be furnished to Holders of the
Certificates pursuant to Section 4.04 hereof. Funds held in the FSA Account
shall not be invested by the Trustee.
(d) On any Distribution Date with respect to which a claim has been made
under the FSA Policy, the amount of any Insured Payment received by the
Trustee as a result of any claim under the FSA Policy and which is required to
make distributions on the Class A-2 Certificates equal to Guaranteed
Distributions on the Class A-2 Certificates on such Distribution Date, shall
be withdrawn from the FSA Account, deposited into the Distribution Account and
applied directly by the Trustee, together with all other funds to be withdrawn
from the Distribution Account, to the payment in full of Guaranteed
Distributions on the Class A-2 Certificates. Any funds remaining in the FSA
Account on the first Business Day following a Distribution Date shall be
remitted in immediately available funds to FSA, pursuant to the instructions
of FSA, by the end of such Business Day. FSA shall have the right to inspect
such records at reasonable times during normal business hours upon reasonable
prior written notice to the Trustee.
(e) The Trustee shall promptly notify FSA of any proceeding or the
institution of any action, of which a Responsible Officer of the Trustee has
actual knowledge, seeking the avoidance as a preferential transfer under the
Bankruptcy Code (a "Preference Claim") of any distribution made with respect
to the Class A-2 Certificates. Each Certificateholder of Class A-2
Certificates, by its purchase of Class A-2 Certificates, the Seller, the
Servicer and the Trustee hereby agree that FSA (so long as there is no
continuing default by FSA under its obligations
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under the FSA Policy) may at any time during the continuation of any
proceeding relating to a Preference Claim direct all matters relating to such
Preference Claim, including, without limitation, (i) the direction of any
appeal of any order relating to such Preference Claim and (ii) the posting of
any surety, supersedeas or performance bond pending any such appeal.
(f) The Trustee shall keep a complete and accurate record of the amount
of interest and principal paid in respect of any Class A-2 Certificates from
moneys received under the FSA Policy. FSA shall have the right to inspect such
records at reasonable times during normal business hours upon one Business
Day's prior notice to the Trustee.
(g) Anything herein to the contrary notwithstanding, any payment with
respect to principal of or interest on any of the Class A-2 Certificates which
is made with moneys received pursuant to the terms of the FSA Policy shall not
be considered payment of such Class A-2 Certificates from the Trust Fund and
shall not result in the payment of or the provision for the payment of the
principal of or interest on such Certificates within the meaning of Section
4.02. The Depositor, the Seller, the Servicer and the Trustee acknowledge, and
each Holder by its acceptance of a Class A-2 Certificate agrees, that without
the need for any further action on the part of FSA, the Depositor, the Seller,
the Servicer or the Trustee (a) to the extent FSA makes payments, directly or
indirectly, on account of principal of or interest on the Class A-2
Certificates to the Holders of such Certificates, FSA will be fully subrogated
to the rights of such Holders to receive such principal and interest from the
Trust Fund and (b) FSA shall be paid such principal and interest but only from
the sources and in the manner provided herein for the payment of such
principal and interest.
(h) The Trustee and the Servicer shall cooperate in all respects with any
reasonable request by FSA for action to preserve or enforce FSA's rights or
interests under this Agreement without limiting the rights or affecting the
interests of the Holders as otherwise set forth herein.
(i) All notices, statements, reports, certificates or opinions sent or
required to be sent pursuant to this Agreement shall also be sent at such time
to FSA at Financial Security Assurance, Inc., 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attn: Transaction Oversight.
(j) FSA shall be a third-party beneficiary of this Agreement, entitled to
enforce the provisions hereof as if a party hereto.
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ARTICLE V
THE CERTIFICATES
SECTION 5.01 The Certificates.
The Certificates shall be substantially in the forms attached hereto as
exhibits. The Certificates shall be issuable in registered form, in the
minimum denominations, integral multiples in excess thereof (except that one
Certificate in each Class may be issued in a different amount which must be in
excess of the applicable minimum denomination) and aggregate denominations per
Class set forth in the Preliminary Statement.
Subject to Section 9.02 respecting the final distribution on the
Certificates, on each Distribution Date the Trustee shall make distributions
to each Certificateholder of record on the preceding Record Date either (x) by
wire transfer in immediately available funds to the account of such holder at
a bank or other entity having appropriate facilities therefor, if (i) such
Holder has so notified the Trustee at least five Business Days prior to the
related Record Date and (ii) such Holder shall hold (A) a Notional Amount
Certificate, (B) 100% of the Class Principal Balance of any Class of
Certificates or (C) Certificates of any Class with aggregate principal
Denominations of not less than $1,000,000 or (y) by check mailed by first
class mail to such Certificateholder at the address of such holder appearing
in the Certificate Register.
The Certificates shall be executed by manual or facsimile signature on
behalf of the Trustee by a Responsible Officer upon the written order of the
Depositor. Certificates bearing the manual or facsimile signatures of
individuals who were, at the time such signatures were affixed, authorized to
sign on behalf of the Trustee shall bind the Trustee, notwithstanding that
such individuals or any of them have ceased to be so authorized prior to the
authentication and delivery of any such Certificates or did not hold such
offices at the date of such Certificate. No Certificate shall be entitled to
any benefit under this Agreement, or be valid for any purpose, unless there
appears on such certificate a Certificate of Authentication in the form
provided herein, executed by the Trustee by manual signature, and such
authentication upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate has been duly executed and delivered
hereunder. All Certificates shall be dated the date of their countersignature.
On the Closing Date, the Trustee shall authenticate the Certificates to be
issued at the written direction of the Depositor, or any affiliate thereof.
The Depositor shall provide, or cause to be provided, to the Trustee on a
continuous basis, an adequate inventory of Certificates to facilitate
transfers.
SECTION 5.02 Certificate Register; Registration of Transfer and Exchange
of Certificates.
(a) The Trustee shall maintain, or cause to be maintained in accordance
with the provisions of Section 5.06, a Certificate Register for the Trust Fund
in which, subject to the provisions of subsections (b) and (c) below and to
such reasonable regulations as it may prescribe, the Trustee shall provide for
the registration of Certificates and of transfers and exchanges of
Certificates as herein provided. Upon surrender for registration of transfer
of any
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Certificate, the Trustee shall execute and deliver, in the name of the
designated transferee or transferees, one or more new Certificates of the same
Class and aggregate Percentage Interest.
At the option of a Certificateholder, Certificates may be exchanged for
other Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest upon surrender of the
Certificates to be exchanged at the office or agency of the Trustee. Whenever
any Certificates are so surrendered for exchange, the Trustee shall execute,
authenticate, and deliver the Certificates which the Certificateholder making
the exchange is entitled to receive. Every Certificate presented or
surrendered for registration of transfer or exchange shall be accompanied by a
written instrument of transfer in form satisfactory to the Trustee duly
executed by the holder thereof or his attorney duly authorized in writing.
No service charge to the Certificateholders shall be made for any
registration of transfer or exchange of Certificates, but payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates may be required.
All Certificates surrendered for registration of transfer or exchange
shall be cancelled and subsequently disposed of by the Trustee in accordance
with the Trustee's customary procedures.
(b) No transfer of a Private Certificate shall be made unless such
transfer is made pursuant to an effective registration statement under the
Securities Act and any applicable state securities laws or is exempt from the
registration requirements under said Act and such state securities laws.
Except in connection with any transfer of a Private Certificate by the
Depositor to any affiliate, 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 Trustee in writing the facts surrounding
the transfer in substantially the form set forth in Exhibit J (the "Transferor
Certificate") and (i) deliver a letter in substantially the form of either
Exhibit K (the "Investment Letter") or Exhibit L (the "Rule 144A Letter") or
(ii) there shall be delivered to the Trustee at the expense of the transferor
an Opinion of Counsel that such transfer may be made pursuant to an exemption
from the Securities Act. The Depositor shall provide to any Holder of a
Private Certificate and any prospective transferee designated by any such
Holder, information regarding the related Certificates and the Mortgage Loans
and such other information as shall be necessary to satisfy the condition to
eligibility set forth in Rule 144A(d)(4) for transfer of any such Certificate
without registration thereof under the Securities Act pursuant to the
registration exemption provided by Rule 144A. The Trustee shall cooperate with
the Depositor in providing the Rule 144A information referenced in the
preceding sentence, including providing to the Depositor such information
regarding the Certificates, the Mortgage Loans and other matters regarding the
Trust Fund as the Depositor shall reasonably request to meet its obligation
under the preceding sentence. Each Holder of a Private Certificate desiring to
effect such transfer shall, and does hereby agree to, indemnify the Trustee,
the Depositor, the Seller and the Servicer against any liability that may
result if the transfer is not so exempt or is not made in accordance with such
federal and state laws.
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No transfer of an ERISA-Restricted Certificate shall be made unless the
Trustee shall have received either (i) a representation letter from the
transferee substantially in the form of Exhibit M, in the case of a Private
Certificate, or Exhibit N, in the case of a Residual Certificate, to the
effect that (a) such transferee is not an employee benefit plan or arrangement
subject to Section 406 of ERISA or a plan subject to Section 4975 of the Code,
nor a person acting on behalf of any such plan or arrangement or using the
assets of any such plan or arrangement to effect such transfer or (b) if the
ERISA-Restricted Certificate has been the subject of an ERISA-Qualifying
Underwriting, it is being purchased by an "insurance company general account"
(as defined in Section V(e) of Prohibited Transaction Class Exemption ("PTCE")
95-60, and the acquisition and holding of the ERISA-Restricted Certificate
satisfy the requirements for exemptive relief under Sections I and III of PTCE
95-60; 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 or arrangement 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 or arrangement or using such
plan's or arrangement's assets, an Opinion of Counsel satisfactory to the
Trustee, which Opinion of Counsel shall not be an expense of either the
Trustee or the Trust Fund, addressed to the Trustee, to the effect that the
purchase or holding of such ERISA-Restricted Certificate will not result in a
prohibited transaction under Section 406 of ERISA or Section 4975 of the Code,
will not result in the assets of the Trust Fund being deemed to be "plan
assets" and subject to the prohibited transaction provisions of ERISA and the
Code and will not subject the Trustee or the Servicer to any obligation in
addition to those expressly undertaken in this Agreement or to any liability.
The transferee of an ERISA-Restricted Certificate that is a Book-Entry
Certificate, by its acceptance of the Book-Entry Certificate, will be deemed
to make the representation in clauses (a) or (b) above. In the event that a
representation is violated, or any attempt to transfer to a plan or person
acting on behalf of a plan or using a plan's assets is attempted without the
delivery to the Trustee of the Opinion of Counsel described above, the
attempted transfer or acquisition shall be void and of no effect.
To the extent permitted under applicable law (including, but not limited
to, ERISA), the Trustee shall be under no liability to any Person for any
registration of transfer of any ERISA-Restricted Certificate that is in fact
not permitted by this Section 5.02(b) or for making any payments due on such
Certificate to the Holder thereof or taking any other action with respect to
such Holder under the provisions of this Agreement so long as the transfer was
registered by the Trustee in accordance with the foregoing requirements.
(c) Each Person who has or who acquires any Ownership Interest in a
Residual Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions, and
the rights of each Person acquiring any Ownership Interest in a Residual
Certificate are expressly subject to the following provisions:
(i) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall be a Permitted Transferee and shall promptly
notify the Trustee of any change or impending change in its status as a
Permitted Transferee.
(ii) No Ownership Interest in a Residual Certificate may be
registered on the Closing Date or thereafter transferred, and the Trustee
shall not register the Transfer of
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any Residual Certificate unless, in addition to the certificates required
to be delivered to the Trustee under subparagraph (b) above, the Trustee
shall have been furnished with an affidavit (a "Transfer Affidavit") of
the initial owner or the proposed transferee in the form attached hereto
as Exhibit G.
(iii) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall agree (A) to obtain a Transfer Affidavit from
any other Person to whom such Person attempts to Transfer its Ownership
Interest in a Residual Certificate, (B) to obtain a Transfer Affidavit
from any Person for whom such Person is acting as nominee, trustee or
agent in connection with any Transfer of a Residual Certificate and (C)
not to Transfer its Ownership Interest in a Residual Certificate or to
cause the Transfer of an Ownership Interest in a Residual Certificate to
any other Person if it has actual knowledge that such Person is not a
Permitted Transferee.
(iv) Any attempted or purported Transfer of any Ownership Interest
in a Residual Certificate in violation of the provisions of this Section
5.02(c) shall be absolutely null and void and shall vest no rights in the
purported Transferee. If any purported transferee shall become a Holder
of a Residual Certificate in violation of the provisions of this Section
5.02(c), then the last preceding Permitted Transferee shall be restored
to all rights as Holder thereof retroactive to the date of registration
of Transfer of such Residual Certificate. The Trustee shall be under no
liability to any Person for any registration of Transfer of a Residual
Certificate that is in fact not permitted by Section 5.02(b) and this
Section 5.02(c) or for making any payments due on such Certificate to the
Holder thereof or taking any other action with respect to such Holder
under the provisions of this Agreement so long as the Transfer was
registered after receipt of the related Transfer Affidavit, Transferor
Certificate and either the Rule 144A Letter or the Investment Letter. The
Trustee shall be entitled but not obligated to recover from any Holder of
a Residual Certificate that was in fact not a Permitted Transferee at the
time it became a Holder or, at such subsequent time as it became other
than a Permitted Transferee, all payments made on such Residual
Certificate at and after either such time. Any such payments so recovered
by the Trustee shall be paid and delivered by the Trustee to the last
preceding Permitted Transferee of such Certificate.
(v) The Depositor shall use its best efforts to make available, upon
receipt of written request from the Trustee, all information necessary to
compute any tax imposed under Section 860E(e) of the Code as a result of
a Transfer of an Ownership Interest in a Residual Certificate to any
Holder who is not a Permitted Transferee.
The restrictions on Transfers of a Residual Certificate set forth in this
Section 5.02(c) shall cease to apply (and the applicable portions of the
legend on a Residual Certificate may be deleted) with respect to Transfers
occurring after delivery to the Trustee of an Opinion of Counsel, which
Opinion of Counsel shall not be an expense of the Trust Fund, the Trustee, the
Seller or the Servicer, to the effect that the elimination of such
restrictions will not cause the REMIC hereunder to fail to qualify as a REMIC
at any time that the Certificates are outstanding or result in the imposition
of any tax on the Trust Fund, a Certificateholder or another Person. Each
Person holding or acquiring any Ownership Interest in a Residual Certificate
hereby consents to any amendment of this Agreement which, based on an Opinion
of Counsel furnished
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to the Trustee, is reasonably necessary (a) to ensure that the record
ownership of, or any beneficial interest in, a Residual Certificate is not
transferred, directly or indirectly, to a Person that is not a Permitted
Transferee and (b) to provide for a means to compel the Transfer of a Residual
Certificate which is held by a Person that is not a Permitted Transferee to a
Holder that is a Permitted Transferee.
(d) The preparation and delivery of all certificates and opinions
referred to above in this Section 5.02 in connection with transfer shall be at
the expense of the parties to such transfers.
(e) Except as provided below, the Book-Entry Certificates shall at all
times remain registered in the name of the Depository or its nominee and at
all times: (i) registration of the Certificates may not be transferred by the
Trustee except to another Depository; (ii) the Depository shall maintain
book-entry records with respect to the Certificate Owners and with respect to
ownership and transfers of such Book-Entry Certificates; (iii) ownership and
transfers of registration of the Book-Entry Certificates on the books of the
Depository shall be governed by applicable rules established by the
Depository; (iv) the Depository may collect its usual and customary fees,
charges and expenses from its Depository Participants; (v) the Trustee shall
deal with the Depository, Depository Participants and indirect participating
firms as representatives of the Certificate Owners of the Book-Entry
Certificates for purposes of exercising the rights of holders under this
Agreement, and requests and directions for and votes of such representatives
shall not be deemed to be inconsistent if they are made with respect to
different Certificate Owners; and (vi) the Trustee may rely and shall be fully
protected in relying upon information furnished by the Depository with respect
to its Depository Participants and furnished by the Depository Participants
with respect to indirect participating firms and persons shown on the books of
such indirect participating firms as direct or indirect Certificate Owners.
All transfers by Certificate Owners of Book-Entry Certificates shall be
made in accordance with the procedures established by the Depository
Participant or brokerage firm representing such Certificate Owner. Each
Depository Participant shall only transfer Book-Entry Certificates of
Certificate Owners it represents or of brokerage firms for which it acts as
agent in accordance with the Depository's normal procedures.
If (x) (i) the Depository or the Depositor advises the Trustee in writing
that the Depository is no longer willing or able to properly discharge its
responsibilities as Depository, and (ii) the Trustee or the Depositor is
unable to locate a qualified successor, (y) the Depositor at its option
advises the Trustee in writing that it elects to terminate the book-entry
system through the Depository or (z) after the occurrence of an Event of
Default, Certificate Owners representing at least 51% of the Certificate
Balance of the Book-Entry Certificates together advise the Trustee and the
Depository through the Depository Participants in writing that the
continuation of a book-entry system through the Depository is no longer in the
best interests of the Certificate Owners, the Trustee shall notify all
Certificate Owners, through the Depository, of the occurrence of any such
event and of the availability of definitive, fully-registered Certificates
(the "Definitive Certificates") to Certificate Owners requesting the same.
Upon surrender to the Trustee of the related Class of Certificates by the
Depository, accompanied by the instructions from the Depository for
registration, the Trustee shall issue the Definitive Certificates. None of the
Seller, the Servicer, the Depositor or the Trustee shall be liable for any
delay in delivery of
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such instruction and each may conclusively rely on, and shall be protected in
relying on, such instructions. The Depositor shall provide the Trustee with an
adequate inventory of certificates to facilitate the issuance and transfer of
Definitive Certificates. Upon the issuance of Definitive Certificates all
references herein to obligations imposed upon or to be performed by the
Depository shall be deemed to be imposed upon and performed by the Trustee, to
the extent applicable with respect to such Definitive Certificates and the
Trustee shall recognize the Holders of the Definitive Certificates as
Certificateholders hereunder; provided that the Trustee shall not by virtue of
its assumption of such obligations become liable to any party for any act or
failure to act of the Depository.
SECTION 5.03 Mutilated, Destroyed, Lost or Stolen Certificates.
If (a) any mutilated Certificate is surrendered to the Trustee, or the
Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Certificate and (b) there is delivered to the Trustee such
security or indemnity as may be required by it to hold it harmless, then, in
the absence of notice to the Trustee that such Certificate has been acquired
by a bona fide purchaser, the Trustee shall execute, 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
5.03, the Trustee may require the payment of a sum sufficient to cover any tax
or other governmental charge that may be imposed in relation thereto and any
other expenses (including the fees and expenses of the Trustee) connected
therewith. Any replacement Certificate issued pursuant to this Section 5.03
shall constitute complete and indefeasible evidence of ownership, as if
originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.
SECTION 5.04 Persons Deemed Owners.
The Servicer and the Trustee and any agent of the Servicer or the Trustee
may treat the Person in whose name any Certificate is registered as the owner
of such Certificate for the purpose of receiving distributions as provided in
this Agreement and for all other purposes whatsoever, and none of the Servicer
or the Trustee or any agent of the Servicer or the Trustee shall be affected
by any notice to the contrary.
SECTION 5.05 Access to List of Certificateholders' Names and Addresses.
If three or more Certificateholders (a) request such information in
writing from the Trustee, (b) state that such Certificateholders desire to
communicate with other Certificateholders with respect to their rights under
this Agreement or under the Certificates, and (c) provide a copy of the
communication which such Certificateholders propose to transmit, or if the
Depositor or the Servicer shall request such information in writing from the
Trustee, then the Trustee shall, within ten Business Days after the receipt of
such request, provide the Depositor, the Servicer or such Certificateholders
at such recipients' expense the most recent list of the Certificateholders of
such Trust Fund held by the Trustee, if any. The Depositor and every
Certificateholder, by receiving and holding a Certificate, agree that the
Trustee shall not be held accountable by reason of the disclosure of any such
information as to the list of the Certificateholders hereunder, regardless of
the source from which such information was derived.
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SECTION 5.06 Maintenance of Office or Agency.
The Trustee will maintain or cause to be maintained at its expense an
office or offices or agency or agencies in Saint Xxxx, Minnesota where
Certificates may be surrendered for registration of transfer or exchange. The
Trustee initially designates its Corporate Trust Office for such purposes. The
Trustee will give prompt written notice to the Certificateholders of any
change in such location of any such office or agency.
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ARTICLE VI
THE DEPOSITOR, THE SELLER AND THE SERVICER
SECTION 6.01 Respective Liabilities of the Depositor, the Seller and
the Servicer.
The Depositor, the Seller and the Servicer shall each be liable in
accordance herewith only to the extent of the obligations specifically and
respectively imposed upon and undertaken by them herein.
SECTION 6.02 Merger or Consolidation of the Depositor, the Seller or
the Servicer.
The Depositor, the Seller and the Servicer will each keep in full effect
its existence, rights and franchises as a corporation under the laws of the
United States or under the laws of one of the states thereof and will each
obtain and preserve its qualification to do business as a foreign corporation
in each jurisdiction in which such qualification is or shall be necessary to
protect the validity and enforceability of this Agreement, or any of the
Mortgage Loans and to perform its respective duties under this Agreement.
Any Person into which the Depositor, the Seller or the Servicer may be
merged or consolidated, or any Person resulting from any merger or
consolidation to which the Depositor, the Seller or the Servicer shall be a
party, or any person succeeding to the business of the Depositor, the Seller
or the Servicer, shall be the successor of the Depositor, the Seller or the
Servicer, as the case may be, hereunder, without the execution or filing of
any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding, provided, however, that the
successor or surviving Person with respect to a merger or consolidation of the
Servicer shall be an institution either (i) having a net worth of not less
than $10,000,000 or whose deposits are insured by the FDIC through the BIF or
the SAIF, and (ii) which is a FNMA or FHLMC approved servicer in good
standing.
SECTION 6.03 Limitation on Liability of the Depositor, the Seller, the
Servicer and Others.
(a) None of the Depositor, the Seller, the Servicer nor any of the
directors, officers, employees or agents of the Depositor, the Seller or the
Servicer shall be under any liability to the Certificateholders for any action
taken or for refraining from the taking of any action in good faith pursuant
to this Agreement, or for errors in judgment; provided, however, that this
provision shall not protect the Depositor, the Seller, the Servicer or any
such Person against any breach of representations or warranties made by it
herein or protect the Depositor, the Seller, the Servicer or any such Person
from any liability which would otherwise be imposed by reasons of willful
misfeasance, bad faith or gross negligence in the performance of duties or by
reason of reckless disregard of obligations and duties hereunder. The
Depositor, the Seller, the Servicer and any director, officer, employee or
agent of the Depositor, the Seller or the Servicer may rely in good faith on
any document of any kind prima facie properly executed and submitted by any
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Person respecting any matters arising hereunder. None of the Depositor, the
Seller or the Servicer shall be under any obligation to appear in, prosecute
or defend any legal action that is not incidental to its respective duties
hereunder and which in its opinion may involve it in any expense or liability;
provided, however, that any of the Depositor, the Seller or the Servicer may
in its discretion undertake any such action that it may deem necessary or
desirable in respect of this Agreement and the rights and duties of the
parties hereto and interests of the Trustee and the Certificateholders
hereunder. In such event, the legal expenses and costs of such action and any
liability resulting therefrom shall be expenses, costs and liabilities of the
Trust Fund, and the Depositor, the Seller and the Servicer shall be entitled
to be reimbursed therefor from the Trust Fund.
(b) The Servicer shall indemnify the Trustee and hold it 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 Trustee may sustain in any way related to the
failure of the Servicer to perform its duties and service the Mortgage Loans
in strict compliance with the terms of this Agreement. The Servicer
immediately shall notify the Trustee if a claim is made by a third party with
respect to this Agreement or the Mortgage Loans, assume (with the prior
written consent of the Trustee) the defense of any such claim and pay all
expenses in connection therewith, including counsel fees, and promptly pay,
discharge and satisfy any judgment or decree which may be entered against it
or the Trustee in respect of such claim. The Servicer shall follow any written
instructions received from the Trustee in connection with such claim. Except
as otherwise provided herein, the Trustee promptly shall reimburse the
Servicer for all amounts advanced by it pursuant to the preceding sentence
except when the claim is in any way related to the failure of the Servicer to
service and administer the Mortgage Loans in strict compliance with the teens
of this Agreement.
SECTION 6.04 Limitation on Resignation of the Servicer.
(a) Subject to Section 6.04(b) below, the Servicer shall not resign from
the obligations and duties hereby imposed on it except (i) upon appointment of
a successor servicer (which may be with respect to all or a portion of the
Mortgage Loans), and receipt by the Trustee of a letter from each Rating
Agency that such a resignation and appointment will not result in a
downgrading of the rating of any of the Certificates related to the applicable
Mortgage Loans, or (ii) upon determination that its duties hereunder are no
longer permissible under applicable law. Any such determination under clause
(ii) permitting the resignation of the Servicer shall be evidenced by an
Opinion of Counsel to such effect delivered to the Trustee. No such
resignation shall become effective until the Trustee or a successor servicer
shall have assumed the Servicer's responsibilities, duties, liabilities and
obligations hereunder.
(b) Notwithstanding the foregoing, DLJ Mortgage Capital Inc., as owner of
the servicing rights, or any subsequent owner of the servicing rights shall be
entitled to require that the Servicer resign and appoint a successor servicer;
provided that such entity delivers to the Trustee the letter required by
6.04(a)(i) above.
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SECTION 6.05 Limitation Upon Liability of the Loss Mitigation Advisor.
Neither the Loss Mitigation Advisor, nor any of the directors, officers,
employees or agents of the Loss Mitigation Advisor, shall be under any
liability to 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
Servicer under the Loss Mitigation Advisory Agreement or for errors in
judgment; provided, however, that this provision shall not protect the Loss
Mitigation Advisor or any such person against liability that would otherwise
be imposed by reason of willful malfeasance, bad faith or gross negligence in
its performance of its duties or by reason of reckless disregard for its
obligations and duties under this Agreement or the Loss Mitigation Advisory
Agreement. The Loss Mitigation Advisor and any director, officer, employee or
agent of the Loss Mitigation Advisor 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, and may rely in good faith upon the accuracy of
information furnished by the Servicer pursuant to the Loss Mitigation Advisory
Agreement in the performance of its duties thereunder and hereunder.
ARTICLE VII
DEFAULT
SECTION 7.01 Events of Default.
"Event of Default", wherever used herein, means any one of the following
events:
(i) any failure by the Servicer to make any deposit or payment
required pursuant to this Agreement (including but not limited to
Advances to the extent required under Section 4.01) which continues
unremedied for a period of three days after the date upon which written
notice of such failure, requiring the same to be remedied, shall have
been given to the Servicer by the Trustee or the Depositor, or to the
Servicer and the Trustee by the Holders of Certificates having not less
than 25% of the Voting Rights evidenced by the Certificates; or
(ii) any failure by the Servicer duly to observe or perform in any
material respect any other of the covenants or agreements on the part of
the Servicer set forth in this Agreement, or if any of the
representations and warranties of the Servicer in Section 2.03(a) proves
to be untrue in any material respect, which failure or breach continues
unremedied for a period of 60 days after the date on which written notice
of such failure or breach, requiring the same to be remedied, shall have
been given to the Servicer by the Trustee or the Depositor, or to the
Servicer and the Trustee by the Holders of Certificates having not less
than 25% of the Voting Rights evidenced by the Certificates, provided,
however, that in the case of a failure that cannot be cured within 60
days, the cure period may be extended if the Servicer can demonstrate to
the reasonable satisfaction of the Trustee and FSA that the Servicer is
diligently pursuing remedial action; or;
(iii) failure by the Servicer to maintain, if required, its license
to do business in any jurisdiction where the related Mortgaged Property
is located; or
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(iv) a decree or order of a court or agency or supervisory authority
having jurisdiction for the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of debt, including bankruptcy,
marshaling of assets and liabilities or similar proceedings, or for the
winding-up or liquidation of its affairs, shall have been entered against
the Servicer and such decree or order shall have remained in force
undischarged or unstayed for a period of 60 consecutive days; or
(v) the Servicer shall consent to the appointment of a conservator
or receiver or liquidator in any insolvency, readjustment of debt,
marshaling of assets and liabilities or similar proceedings of or
relating to the Servicer or of or relating to all or substantially all of
its property; or
(vi) the Servicer shall admit in writing its inability to pay its
debts generally as they become due, file a petition to take advantage of
or commence a voluntary case under, any applicable insolvency, bankruptcy
or reorganization statute, make an assignment for the benefit of its
creditors, voluntarily suspend payment of its obligations; or
(vii) the Servicer ceases to meet the qualifications of a FNMA or
FHLMC-approved servicer.
Other than an Event of Default resulting from a failure of the Servicer
to make any required Advance, if an Event of Default shall occur and a
Responsible Officer of the Trustee has knowledge thereof, then, and in each
and every such case, so long as such Event of Default shall not have been
remedied, the Trustee may, or at the direction of the Holders of Certificates
evidencing not less than 51% of the Voting Rights evidenced by the
Certificates, the Trustee shall by notice in writing to the Servicer (with a
copy to each Rating Agency), terminate all of the rights and obligations of
the Servicer under this Agreement and in and to the related Mortgage Loans and
the proceeds thereof, other than its rights as a Certificateholder hereunder.
If an Event of Default results from the failure of the Servicer to make a
required Advance, the Trustee shall, by notice in writing to the Servicer and
the Depositor (with a copy to each Rating Agency), terminate all of the rights
and obligations of the Servicer under this Agreement and in and to the related
Mortgage Loans and the proceeds thereof, other than its rights as a
Certificateholder hereunder.
Upon receipt by the Servicer of such written notice of termination, all
authority and power of the Servicer under this Agreement, whether with respect
to the related Mortgage Loans or otherwise, shall pass to and be vested in the
Trustee or its nominee, subject to Section 7.02. Upon written request from the
Trustee, the Servicer shall prepare, execute and deliver to the successor
entity designated by the Trustee any and all documents and other instruments,
place in such successor's possession all related Mortgage Files, and do or
cause to be done all other acts or things necessary or appropriate to effect
the purposes of such notice of termination, including but not limited to the
transfer and endorsement or assignment of the related Mortgage Loans and
related documents, at the Servicer's sole expense. The Servicer shall
cooperate with the Trustee and such successor in effecting the termination of
the Servicer's responsibilities and rights hereunder, including without
limitation, the transfer to such successor for administration by it of all
cash amounts which shall at the time be credited by the Servicer to a
Collection Account or
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Escrow Account or thereafter received with respect to the related Mortgage
Loans. The Trustee shall thereupon make any Advance unless prohibited by
applicable law. The Trustee is hereby authorized and empowered to execute and
deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, any and
all documents and other instruments, and to do or accomplish all other acts or
things necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement or assignment of
the related Mortgage Loans and related documents, or otherwise.
SECTION 7.02 Trustee to Act; Appointment of Successor.
On and after the time the Servicer receives a notice of termination
pursuant to Section 7.01 of this Agreement, the Trustee shall, subject to and
to the extent provided herein, be the successor to the Servicer, but only in
its capacity as servicer under this Agreement, and not in any other, and the
transactions set forth herein and shall be subject to all the
responsibilities, duties and liabilities relating thereto placed on the
Servicer by the terms and provisions hereof and applicable law including the
obligation to make Advances pursuant to Section 4.01. As compensation
therefor, the Trustee shall be entitled to all funds relating to the related
Mortgage Loans that the Servicer would have been entitled to charge to a
Collection Account, provided that the terminated Servicer shall nonetheless be
entitled to payment or reimbursement as provided in Section 3.08(a) to the
extent that such payment or reimbursement relates to the period prior to
termination of the Servicer. Notwithstanding the foregoing, if the Trustee has
become the successor to the Servicer in accordance with Section 7.01, the
Trustee may, if it shall be unwilling to so act, or shall, if it is prohibited
by applicable law from making Advances pursuant to 4.01 hereof, 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 Servicer
hereunder in the assumption of all or any part of the responsibilities, duties
or liabilities of the Servicer hereunder. Any successor to the Servicer shall
be an institution which is a FNMA or FHLMC approved seller/servicer in good
standing, which has a net worth of at least $10,000,000, which is willing to
service the related Mortgage Loans and which executes and delivers to the
Depositor and the Trustee an agreement accepting such delegation and
assignment, containing an assumption by such Person of the rights, powers,
duties, responsibilities, obligations and liabilities of the Servicer (other
than liabilities of the Servicer under Section 6.03 hereof incurred prior to
termination of the Servicer under Section 7.01 hereunder), with like effect as
if originally named as a party to this Agreement; provided that each Rating
Agency acknowledges that its rating of the Certificates in effect immediately
prior to such assignment and delegation will not be qualified or reduced as a
result of such assignment and delegation. Pending appointment of a successor
to the Servicer hereunder, the Trustee, unless the Trustee is prohibited by
law from so acting, shall, subject to the limitations described herein, act in
such capacity as hereinabove provided. In connection with such appointment and
assumption, the Trustee may make such arrangements for the compensation of
such successor out of payments on the related Mortgage Loans as it and such
successor shall agree; provided, however, that no such compensation shall be
in excess of the Servicing Fee. The Trustee and such successor shall take such
action, consistent with this Agreement, as shall be necessary to effectuate
any such succession. Neither the Trustee nor any other successor servicer
shall be deemed to be in default 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
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performing, any duties or responsibilities hereunder, in either case caused by
the failure of the Servicer to deliver or provide, or any delay in delivering
or providing, any cash, information, documents or records to it.
Any successor to the Servicer shall give notice to the Mortgagors of such
change of servicer and shall, during the term of its service as servicer,
maintain in force the policy or policies that the Servicer is required to
maintain pursuant to this Agreement.
SECTION 7.03 Notification to Certificateholders.
(a) Upon any termination of or appointment of a successor to the
Servicer, the Trustee shall give prompt written notice thereof to
Certificateholders and to each Rating Agency.
(b) Within 60 days after the occurrence of any Event of Default, the
Trustee shall transmit by mail to all Certificateholders notice of each such
Event of Default hereunder actually known to a Responsible Officer the
Trustee, unless such Event of Default shall have been cured or waived.
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ARTICLE VIII
CONCERNING THE TRUSTEE
SECTION 8.01 Duties of the Trustee.
The Trustee, prior to the occurrence of an Event of Default and after the
curing or waiver of all Events of Default that may have occurred, shall
undertake to perform such duties and only such duties as are specifically set
forth in this Agreement. In case an Event of Default has occurred and remains
uncured and not 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.
The Trustee, upon receipt of all resolutions, certificates, statements,
opinions, reports, documents. orders or other instruments furnished to the
Trustee that are specifically required to be furnished pursuant to any
provision of this Agreement shall examine them to determine whether they are
in the form required by this Agreement; provided, however, that the Trustee
shall not be responsible for the accuracy or content of any such resolution,
certificate, statement, opinion, report, document, order or other instrument.
No provision of this Agreement shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act
or its own willful misconduct; provided, however, that:
(i) unless an Event of Default actually known to the Trustee shall
have occurred and be continuing, the duties and obligations of the
Trustee shall be determined solely by the express provisions of this
Agreement, the Trustee shall not be liable except for the performance of
such duties and obligations as are specifically set forth in this
Agreement, no implied covenants or obligations shall be read into this
Agreement against the Trustee and the Trustee may conclusively rely, as
to the truth of the statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished to the
Trustee and conforming to the requirements of this Agreement which it
believed in good faith to be genuine and to have been duly executed by
the proper authorities respecting any matters arising hereunder;
(ii) the Trustee shall not be liable for an error of judgment made
in good faith by a Responsible Officer or Responsible Officers of the
Trustee, unless it shall be finally proven that the Trustee was negligent
in ascertaining the pertinent facts;
(iii) the Trustee shall not be liable with respect to any action
taken, suffered or omitted to be taken by it in good faith in accordance
with the direction of the Holders of Certificates evidencing not less
than 25% of the Voting Rights of Certificates relating to the time,
method and place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred upon the Trustee
under this Agreement;
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(iv) no provision of this Agreement shall require the Trustee to act
as Servicer or be responsible in any way for the acts or omissions of the
Servicer until such time as it acts as successor servicer pursuant to the
terms of this Agreement; and
(v) the Trustee shall have no duty (A) (other than in its capacity
as successor servicer) to see to any recording, filing or depositing of
this Agreement or any agreement referred to herein or any financing
statement or continuation statement evidencing a security interest, or to
see to the maintenance of any such recording or filing or depositing of
any thereof, (B) (other than in its capacity as successor servicer)to see
to any insurance, (C) (other than with respect to Section 8.11 hereof) to
see to the payment or discharge of any tax, assessment, or other
governmental charge or any lien or encumbrance of any kind owing with
respect to , assessed or levied against, any part of the Trust Fund, (D)
to confirm or verify the contents of any certificates of the Servicer
delivered to the Trustee pursuant to this Agreement believed by the
Trustee to be genuine and to have been signed or presented by the
appropriate party.
SECTION 8.02 Certain Matters Affecting the Trustee.
Except as otherwise provided in Section 8.01:
(i) the Trustee may request and conclusively rely upon and shall be
protected in acting or refraining from acting upon any resolution,
Officer's Certificate, certificate of auditors or any other certificate,
statement, instrument, opinion, report, notice, request, consent, order,
appraisal, bond or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties and
the Trustee shall have no responsibility to ascertain or confirm the
genuineness of any signature of any such party or parties;
(ii) the Trustee may consult with counsel, financial advisers or
accountants and the advice of any such counsel, financial advisers or
accountants and any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken or suffered
or omitted by it hereunder in good faith and in accordance with such
advice or Opinion of Counsel;
(iii) the Trustee shall not be liable for any action taken, suffered
or omitted by it in good faith and believed by it to be authorized or
within the discretion or rights or powers conferred upon it by this
Agreement;
(iv) the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval,
bond or other paper or document, unless requested in writing so to do by
Holders of Certificates evidencing not less than 25% of the Voting Rights
allocated to each Class of Certificates;
(v) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents,
affiliates, accountants or attorneys and the Trustee shall not be
responsible for any negligence or willful
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misconduct on the part of such agents, affiliates, accountants or
attorneys appointed by it with due care;
(vi) the Trustee shall not be required to risk or expend its own
funds or otherwise incur any financial liability in the performance of
any of its duties or in the exercise of any of its rights or powers
hereunder if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or
liability is not assured to it;
(vii) the Trustee shall not be liable for any loss on any investment
of funds pursuant to this Agreement (other than as issuer of the
investment security);
(viii) the Trustee shall not be deemed to have actual knowledge of
an Event of Default until a Responsible Officer of the Trustee shall have
received written notice thereof;
(ix) the Trustee shall be under no obligation to exercise any of the
trusts, rights or powers vested in it by this Agreement or to institute,
conduct or defend any litigation hereunder or in relation hereto at the
request, order or direction of any of the Certificateholders, pursuant to
the provisions of this Agreement, unless such Certificateholders shall
have offered to the Trustee reasonable security or indemnity satisfactory
to the Trustee against the costs, expenses and liabilities which may be
incurred therein or thereby;
(x) the rights 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 answerable for other than its negligence or willful
misconduct in the performance of such act;
(xi) anything to the contrary in this Agreement notwithstanding, in
no event shall the Trustee be liable for special, indirect or
consequential loss or damage of any kind whatsoever (including, but not
limited to, lost profits) even if the Trustee has been advised of the
likelihood of such loss or damage and regardless of the form of action;
and
(xii) the Trustee shall not be required to give any bond or surety
in respect of the execution of the Trust Fund created hereby or the
powers granted hereunder.
SECTION 8.03 Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates shall be taken as
the statements of the Depositor, the Servicer or the Seller, as the case may
be, and the Trustee assumes no responsibility for their correctness. The
Trustee makes no representations as to the validity or sufficiency of this
Agreement or of the Certificates or of any Mortgage Loan or related document
other than with respect to the Trustee's execution and authentication of the
Certificates. The Trustee shall not be accountable for the use or application
by the Depositor or the Servicer of any funds paid to the Depositor or the
Servicer in respect of the Mortgage Loans or deposited in or withdrawn from
the Collection Account by the Depositor or the Servicer.
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SECTION 8.04 Trustee May Own Certificates.
The Trustee in its individual or any other capacity may become the owner
or pledgee of Certificates and may transact business with the Depositor, the
Seller, the Servicer and their affiliates, with the same rights as it would
have if it were not the Trustee.
SECTION 8.05 Trustee's Fees and Expenses.
(a) The Trustee, as compensation for its activities hereunder, shall be
entitled to withdraw from the Certificate Account on each Distribution Date
prior to making distributions pursuant to Section 4.02 any investment income
or other benefit derived from balances in the Certificate Account for such
Distribution Date pursuant to Section 3.08(b). Subject to the limitations set
forth in Section 8.05(b), the Trustee and any director, officer, employee or
agent of the Trustee shall be indemnified by the Depositor and held harmless
against any loss, liability or expense (including reasonable attorney's fees
and expenses) incurred in connection with any claim or legal action relating
to (a) this Agreement or the Custodial Agreement, (b) the Certificates, or (c)
the performance of any of the Trustee's duties hereunder or under the
Custodial Agreement, other than any loss, liability or expense incurred by
reason of willful misfeasance, bad faith or negligence in the performance of
any of the Trustee's duties hereunder or incurred by reason of any action of
the Trustee taken at the direction of the Certificateholders. Such indemnity
shall survive the termination of this Agreement or the resignation or removal
of the Trustee hereunder. Without limiting the foregoing, the Depositor
covenants and agrees, subject to the limitation set forth in Section 8.05(b),
and except for any such expense, disbursement or advance as may arise from the
Trustee's negligence, bad faith or willful misconduct, to pay or reimburse the
Trustee, for all reasonable expenses, disbursements and advances incurred or
made by the Trustee in accordance with any of the provisions of this Agreement
with respect to: (A) the reasonable compensation and the expenses and
disbursements of its counsel not associated with the closing of the issuance
of the Certificates, (B) the reasonable compensation, expenses and
disbursements of any accountant, engineer or appraiser that is not regularly
employed by the Trustee, to the extent that the Trustee must engage such
persons to perform acts or services hereunder, (C) printing and engraving
expenses in connection with preparing any Definitive Certificates and (D) any
other reasonable expenses incurred other than in the ordinary course of its
business by the Trustee in connection with its duties hereunder. Except as
otherwise provided herein, the Trustee shall not be entitled to payment or
reimbursement for any routine ongoing expenses incurred by the Trustee in the
ordinary course of its duties as Trustee or Paying Agent hereunder or for any
other expenses.
(b) Notwithstanding anything to the contrary in this Agreement, the
Depositor shall not be obligated to pay to the Trustee more than, in the
aggregate, $150,000 pursuant to Section 8.05(a) hereof.
SECTION 8.06 Eligibility Requirements for the Trustee.
The Trustee hereunder shall at all times be a corporation or association
organized and doing business under the laws of a state or the United States of
America, authorized under such laws to exercise corporate trust powers, having
a combined capital and surplus of at least $50,000,000, subject to supervision
or examination by federal or state authority and with a credit
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rating which would not cause either of the Rating Agencies to reduce their
respective then current Ratings of the Certificates (or having provided such
security from time to time as is sufficient to avoid such reduction), as
evidenced in writing by each Rating Agency. If such corporation or association
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
proposes of this Section 8.06 the combined capital and surplus of such
corporation or association shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. 1n
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 8.06, the Trustee shall resign immediately in the
manner and with the effect specified in Section 8.07. The entity serving as
Trustee may have normal banking and trust relationships with the Depositor,
the Seller or the Servicer and their affiliates; provided, however, that such
entity cannot be an affiliate of the Seller, the Depositor or the Servicer
other than the Trustee in its role as successor to the Servicer.
SECTION 8.07 Resignation and Removal of the Trustee.
The Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice of resignation to the Depositor, the
Seller, the Servicer and each Rating Agency not less than 60 days before the
date specified in such notice, when, subject to Section 8.08, such resignation
is to take effect, and acceptance by a successor trustee in accordance with
Section 8.08 meeting the qualifications set forth in Section 8.06. If the
Trustee gives notice of such resignation, the Depositor shall promptly appoint
a successor trustee. If no successor trustee meeting such qualifications shall
have been so appointed and have accepted appointment within 30 days after the
giving of such notice of resignation or removal (as provided below), the
resigning or removed Trustee may petition any court of competent jurisdiction
for the appointment of a successor trustee.
If at any time the Trustee shall cease to be eligible in accordance with
the provisions of Section 8.06 and shall fail to resign after written request
thereto by the Depositor, or if at any time the Trustee shall become incapable
of acting, or shall be adjudged as bankrupt or insolvent, or a receiver of the
Trustee or of its property shall be appointed, or any public officer shall
take charge or control of the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation, or a tax is imposed
with respect to the Trust Fund by any state in which the Trustee or the Trust
Fund is located and the imposition of such tax would be avoided by the
appointment of a different trustee, then the Depositor may remove the Trustee
and appoint a successor trustee by written instrument, in triplicate, one copy
of which shall be delivered to the Trustee, one copy to the Servicer and the
Seller and one copy to the successor trustee.
The Holders of Certificates entitled to at least 51% of the Voting Rights
may at any time remove the Trustee and appoint a successor trustee by written
instrument or instruments, in triplicate, signed by such Holders or their
attorneys-in-fact duly authorized, one complete set of which shall be
delivered by the successor Trustee to the Depositor, the Servicer and the
Seller, one complete set to the Trustee so removed and one complete set to the
successor so appointed. Notice of any removal of the Trustee shall be given to
each Rating Agency by the successor trustee.
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Any resignation or removal of the Trustee and appointment of a successor
trustee pursuant to any of the provisions of this Section 8.07 shall become
effective upon acceptance of appointment by the successor trustee as provided
in Section 8.08.
SECTION 8.08 Successor Trustee.
Any successor trustee appointed as provided in Section 8.07 shall
execute, acknowledge and deliver to the Depositor and to its predecessor
trustee, the Servicer and the Seller an instrument accepting such appointment
hereunder and thereupon the resignation or removal of the predecessor trustee
shall become effective and such successor trustee, without any further act,
deed or conveyance, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor hereunder, with the like effect as
if originally named as trustee herein. The Depositor, the Servicer, the Seller
and the predecessor trustee shall execute and deliver such instruments and do
such other things as may reasonably be required for more fully and certainly
vesting and confirming in the successor trustee all such rights, powers,
duties, and obligations.
No successor trustee shall accept appointment as provided in this Section
8.08 unless at the time of such acceptance such successor trustee shall be
eligible under the provisions of Section 8.06 and its appointment shall not
adversely affect the then current rating of the Certificates.
Upon acceptance of appointment by a successor trustee as provided in this
Section 8.08, the Depositor shall mail notice of the succession of such
trustee hereunder to all Holders of Certificates. If the Depositor fails to
mail such notice within 10 days after acceptance of appointment by the
successor trustee, the successor trustee shall cause such notice to be mailed
at the expense of the Depositor.
SECTION 8.09 Merger or Consolidation of the Trustee.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to the business of the Trustee, shall be the successor
of the Trustee hereunder, provided that such corporation shall be eligible
under the provisions of Section 8.06 without the execution or filing of any
paper or further act on the part of any of the parties hereto, anything herein
to the contrary notwithstanding.
SECTION 8.10 Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for
the purpose of meeting any legal requirements of any jurisdiction in which any
part of the Trust Fund or property securing any Mortgage Note may at the time
be located, the Depositor and the Trustee acting jointly shall have the power
and shall execute and deliver all instruments to appoint one or more Persons
approved by the Trustee to act as co-trustee or co-trustees jointly with the
Trustee, or separate trustee or separate trustees, of all or any part of the
Trust Fund, and to vest in such Person or Persons, in such capacity and for
the benefit of the Certificateholders, such title to the Trust Fund or any
part thereof, whichever is applicable, and, subject to the other provisions of
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this Section 8.10, such powers, duties, obligations, rights and trusts as the
Depositor and the Trustee may consider necessary or desirable. If the
Depositor shall not have joined in such appointment within 15 days after the
receipt by it of a request to do so, or in the case an Event of Default shall
have occurred and be continuing, the Trustee alone shall have the power to
make such appointment. No co-trustee or separate trustee hereunder shall be
required to meet the terms of eligibility as a successor trustee under Section
8.06 and no notice to Certificateholders of the appointment of any co-trustee
or separate trustee shall be required under Section 8.08.
Every separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
(i) To the extent necessary to effectuate the purposes of this
Section 8.10, all rights, powers, duties and obligations conferred or
imposed upon the Trustee, except for the obligation of the Trustee in its
capacity as successor servicer under this Agreement to advance funds on
behalf of the Servicer, shall be conferred or imposed upon and exercised
or performed by the Trustee and such separate trustee or co-trustee
jointly (it being understood that such separate trustee or co-trustee is
not authorized to act separately without the Trustee joining in such
act), except to the extent that under any law of any jurisdiction in
which any particular set or acts are to be performed (whether as Trustee
hereunder or as successor to the Servicer hereunder), the Trustee shall
be incompetent or unqualified to perform such act or acts, in which event
such rights, powers, duties and obligations (including the holding of
title to the applicable Trust Fund or any portion thereof in any such
jurisdiction) shall be exercised and performed singly by such separate
trustee or co-trustee, but solely at the direction of the Trustee;
(ii) No trustee hereunder shall be held personally liable by reason
of any act or omission of any other trustee hereunder and such
appointment shall not, and shall not be deemed to, constitute any such
separate trustee or co-trustee as agent of the Trustee;
(iii) The Trustee may at any time accept the resignation of or
remove any separate trustee or co-trustee; and
(iv) The Depositor, and not the Trustee, shall be liable for the
payment of reasonable compensation, reimbursement and indemnification to
any such separate trustee or co-trustee.
Any notice, request or other writing given to the Trustee shall be deemed
to have been given to each of the separate trustees and co-trustees, when and
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the
conditions of this Article VIII. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Trustee or separately, as may be provided therein, subject to all the
provisions of this Agreement, specifically including every provision of this
Agreement relating to the conduct of, affecting the liability of, or affording
protection to, the Trustee. Every such instrument shall be filed with the
Trustee and a copy thereof given to the Servicer and the Depositor.
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Any separate trustee or co-trustee may, at any time, constitute the
Trustee its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its
estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
SECTION 8.11 Tax Matters.
It is intended that the assets with respect to which any REMIC election
is to be made, as set forth in the Preliminary Statement, shall constitute,
and that the conduct of matters relating to such assets shall be such as to
qualify such assets as, a "real estate mortgage investment conduit" as defined
in and in accordance with the REMIC Provisions. In furtherance of such
intention, the Trustee covenants and agrees that it shall act as agent (and
the Trustee is hereby appointed to act as agent) on behalf of both REMICs and
that in such capacity it shall: (a) prepare, sign and file, or cause to be
prepared and filed, in a timely manner, a U.S. Real Estate Mortgage Investment
Conduit Income Tax Return (Form 1066 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 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 roles, 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) 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; (c) make or cause to be made elections that
such assets be treated as a REMIC on the federal tax return for its first
taxable year (and, if necessary, under applicable state law) and apply for an
employee identification number from the IRS via a Form SS-4 or any other
acceptable method for all tax entities; (d) 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) provide
information necessary for the computation of tax imposed on the transfer of a
Residual Certificate to a Person that is not a Permitted Transferee, or an
agent (including a broker, nominee or other middleman) of a Non-Permitted
Transferee, or a pass-through entity in which a Non-Permitted Transferee is
the record holder of an interest (the reasonable cost of computing and
furnishing such information may be charged to the Person liable for such tax);
(f) to the extent that they are under its control, conduct matters relating to
such assets at all times that any Certificates are outstanding so as to
maintain the status as a REMIC under the REMIC Provisions; (g) not knowingly
or intentionally take any action or omit to take any action that would cause
the termination of the REMIC status of any REMIC hereunder; (h) pay, from the
sources specified in the last paragraph of this Section 8.11, the amount of
any federal or state tax, including prohibited transaction taxes as described
below, imposed on any REMIC hereunder prior to its termination when and as the
same shall be due and
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payable (but such obligation shall not prevent the Trustee or any other
appropriate Person from contesting any such tax in appropriate proceedings and
shall not prevent the Trustee from withholding payment of such tax, if
permitted by law, pending the outcome of such proceedings); (i) ensure that
federal, state or local income tax or information returns shall be signed by
the Trustee or such other person as may be required to sign such returns by
the Code or state or local laws, regulations or rules; (j) maintain records
relating to the REMICs, including but not limited to the income, expenses,
assets and liabilities thereof and the fair market value and adjusted basis of
the assets determined on the accrual method or at such internals as may be
required by the Code, as may be necessary to prepare the foregoing returns,
schedules, statements or information; and (k) as and when necessary and
appropriate, represent any such REMIC 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, enter into settlement agreements with any governmental taxing agency,
extend any statute of limitations relating to any tax item of any such REMIC,
and otherwise act on behalf of the REMICs in relation to any tax matter or
controversy involving it.
In order to enable the Trustee to perform its duties as set forth herein,
the Depositor shall provide, or cause to be provided, to the Trustee within
ten (10) days after the Closing Date all information or data that the Trustee
requests in writing and determines to be relevant for tax purposes to the
valuations and offering prices of the Certificates, including, 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 Trustee promptly upon written request therefor any such
additional information or data that the Trustee may, from time to time,
reasonably request in order to enable the Trustee to perform its duties as set
forth herein. DLJMC hereby indemnifies the Trustee for any losses,
liabilities, damages, claims or expenses of the Trustee arising from any
errors or miscalculations of the Trustee that result from any failure of the
Depositor to provide, or to cause to be provided, accurate information or data
to the Trustee on a timely basis.
In the event that any tax is imposed on "prohibited transactions" of any
REMIC as defined in Section 860F(a)(2) of the Code, on the "net income from
foreclosure property" of any REMIC as defined in Section 860G(c) of the Code,
on any contribution to the REMICs after the Startup Day pursuant to Section
860G(d) of the Code, or any other tax is imposed, including, without
limitation, any minimum tax imposed upon the REMICs pursuant to Sections 23153
and 24874 of the California Revenue and Taxation Code, if not paid as
otherwise provided for herein, such tax shall be paid by (i) the Trustee, if
any such other tax arises out of or results from a breach by the Trustee of
any of its obligations under this Agreement, (ii) the Seller, in the case of
any such minimum tax, if such tax arises out of or results from a breach by
the Seller of any of its obligations under this Agreement or (iii) the Seller,
if any such tax arises out of or results from the Seller's obligation to
repurchase a related Mortgage Loan pursuant to Section 2.02 or 2.03 or (iv) in
all other cases, or in the event that the Trustee or Seller fails to honor its
obligations under the preceding clauses (i), (ii) or (iii) or the Servicer
fails to honor its obligations pursuant to Section 8.15, any such tax will be
paid with amounts otherwise to be distributed to the Certificateholders, as
provided in Section 3.11(b).
The Trustee shall treat the Basis Risk Reserve Fund as an outside reserve
fund within the meaning of Treasury Regulation 1.860G-2(h) that is owned by
the Class X Certificateholder and
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that is not an asset of the REMIC. The Trustee shall treat the rights of the
Class X-0, Xxxxx X-0, Class M-1, Class M-2, and Class B Certificateholders to
receive payments from the Basis Risk Reserve Fund as rights in an interest
rate cap contract written by the Class X Certificateholder in favor of the
Class X-0, Xxxxx X-0, Class M-1, Class M-2, and Class B Certificateholders.
Thus, each Certificate other than the Class X and the Class R Certificates
shall be treated as representing ownership of not only REMIC Regular
Interests, but also ownership of an interest in an interest rate cap contract.
For purposes of determining the issue price of the REMIC Regular interests,
the Trustee shall assume that the Basis Risk Reserve Fund has a value of
$5,000.
The Trustee, the Servicer and the Holders of Certificates shall take any
action or cause the REMIC to take any action necessary to create or maintain
the status of each REMIC as a REMIC under the REMIC Provisions and shall
assist each other as necessary to create or maintain such status. Neither the
Trustee, the Master Servicer nor the Holder of any Residual Certificate shall
take any action, cause any REMIC created hereunder to take any action or fail
to take (or fail to cause to be taken) any action that, under the REMIC
Provisions, if taken or not taken, as the case may be, could (i) endanger the
status of such REMIC as a REMIC or (ii) result in the imposition of a tax upon
such REMIC (including but not limited to the tax on prohibited transactions as
defined in Code Section 860F(a)(2) and the tax on prohibited contributions set
forth on Section 860G(d) of the Code) (either such event, an "Adverse REMIC
Event") unless the Trustee and the Master Servicer have received an Opinion of
Counsel (at the expense of the party seeking to take such action) to the
effect that the contemplated action will not endanger such status or result in
the imposition of such a tax.
Each Holder of a Residual Certificate shall pay when due any and all
taxes imposed on each REMIC created hereunder by federal or state governmental
authorities. To the extent that such Trust taxes are not paid by a Residual
Certificateholder, the Trustee shall pay any remaining REMIC taxes out of
current or future amounts otherwise distributable to the Holder of the
Residual Certificate in the REMICs or, if no such amounts are available, out
of other amounts held in the Distribution Account, and shall reduce amounts
otherwise payable to Holders of regular interests in the related REMIC.
The Trustee shall, for federal income tax purposes, maintain books and
records with respect to each REMIC created hereunder on a calendar year and on
an accrual basis.
The Trustee will apply for an Employee Identification Number from the
Internal Revenue Service via a Form SS-4 or other acceptable method for all
tax entities.
SECTION 8.12 Periodic Filings.
The Trustee shall, on behalf of the Trust, cause to be filed with the
Securities and Exchange Commission any periodic reports required to be filed
under the provisions of the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the Securities and Exchange Commission
thereunder. In connection with the preparation and filing of such periodic
reports, the Depositor and the Servicer shall, upon the written request of the
Trustee, timely provide to the Trustee all material information reasonable
available to them which is requested by the Trustee for the purpose of being
included in such reports. The Trustee shall have no
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liability with respect to any failure to properly prepare or file such
periodic reports resulting from or relating to the Trustee's inability or
failure to obtain any information not resulting from its own negligence or
willful misconduct.
SECTION 8.13 Trust Obligations.
For all purposes herein, any and all rights, duties and obligations of
the Trustee on behalf of the Trust shall be the rights, duties and obligations
of the Trust itself.
SECTION 8.14 Determination of Certificate Index.
On each Interest Determination Date, the Trustee shall determine the
Certificate Index for the Accrual Period and inform the Servicer of such rate.
SECTION 8.15 Indemnification with Respect to Certain Taxes and Loss of
REMIC Status.
In the event that any REMIC fails to qualify as a REMIC, loses its status
as a REMIC, or incurs federal, state or local taxes as a result of a
prohibited transaction or prohibited contribution under the REMIC Provisions
due to the negligent performance by the Servicer of its duties and obligations
set forth herein, the Servicer shall indemnify the Trustee and the Trust Fund
against any and all losses, claims, damages, liabilities or expenses
("Losses") resulting from such negligence; provided, however, that the
Servicer shall not be liable for any such Losses attributable to the
negligence of the Trustee, the Depositor or the Holder of such Class R
Certificate, as applicable, nor for any such Losses resulting from
misinformation provided by the Holder of such Class R Certificate on which the
Servicer has relied. The foregoing shall not be deemed to limit or restrict
the rights and remedies of the Holder of such Class R Certificate now or
hereafter existing at law or in equity. Notwithstanding the foregoing,
however, in no event shall the Servicer have any liability (1) for any action
or omission that is taken in accordance with and in compliance with the
express terms of, or which is expressly permitted by the terms of, this
Agreement, (2) for any Losses other than arising out of a negligent
performance by the Servicer 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).
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ARTICLE IX
TERMINATION
SECTION 9.01 Termination upon Liquidation or Purchase of the Mortgage
Loans.
(a) Subject to Section 9.03, the obligations and responsibilities of the
Depositor, the Seller, the Servicer and the Trustee created hereunder with
respect to the Trust Fund shall terminate upon the earlier of (a) the purchase
by Vesta of all Mortgage Loans (and REO Properties) remaining at the price
equal to the sum of (i) 100% of the Stated Principal Balance of each Mortgage
Loan (other than in respect of REO Property) plus one month's accrued interest
thereon at the applicable Mortgage Rate and (ii) with respect to any REO
Property, the lesser of (x) the appraised value of any REO Property as
determined by the higher of two appraisals completed by two independent
appraisers selected by the Depositor at the expense of the Depositor and (y)
the Stated Principal Balance of each Mortgage Loan related to any REO
Property, in each case and related to any REO Property, in each case plus
accrued and unpaid interest thereon at the applicable Mortgage Rate and (iii)
any unreimbursed Advances, Servicing Advances and Servicing Fees payable to
the Servicer which shall be entitled to withdraw such amounts from the
applicable Collection Account pursuant to Section 3.09(a) and (b) 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. In no event
shall the trusts created hereby continue beyond the expiration of 21 years
from the death of the survivor of the descendants of Xxxxxx X. Xxxxxxx, the
late Ambassador of the United States to the Court of St. James's, living on
the date hereof. The right to repurchase all Mortgage Loans and REO Properties
pursuant to clause (a) above shall be conditioned upon the aggregate Stated
Principal Balance of the Mortgage Loans, at the time of any such repurchase,
aggregating less than ten percent of the Aggregate Collateral Balance as of
the Cut-off Date.
(b) If Vesta elects to terminate the Trust Fund pursuant to Section
9.01(a) above, the Servicer shall retain all servicing rights with respect to
the Mortgage Loans serviced by it. Vesta and the Servicer shall enter into a
servicing agreement mutually acceptable to such parties, pursuant to which the
Servicer shall continue to service and administer such Mortgage Loans in
accordance with the customary and usual standards of practice of prudent
mortgage loan servicers which service such mortgage loans.
SECTION 9.02 Final Distribution on the Certificates.
If on any Determination Date, the Trustee determines that there are no
Outstanding Mortgage Loans and no other funds or assets in the Trust Fund
other than the funds in the Collection Accounts and Certificate Account, the
Trustee shall promptly send a final distribution notice to each
Certificateholder. If Vesta elects to terminate the Trust Fund pursuant to
Section 9.01, at least 20 days prior to the date notice is to be mailed to the
affected Certificateholders, Vesta shall notify the Servicer and the Trustee
of the date it intends to terminate the Trust Fund and of the applicable
repurchase price of the Mortgage Loans and REO Properties.
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Notice of any termination of the Trust Fund, specifying the Distribution
Date on which Certificateholders may surrender their Certificates for payment
of the final distribution and cancellation, shall be given promptly by the
Trustee by letter to Certificateholders mailed not earlier than the 15th day
and not later than the 25th day of the month next preceding 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 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 Trustee shall give such
notice to each Rating Agency at the time such notice is given to
Certificateholders.
Upon presentation and surrender of the Certificates, the Trustee shall
cause to be distributed to the Certificateholders of each Class, in each case
on the final Distribution Date in proportion to their respective Percentage
Interests, with respect to Certificateholders of the same Class, an amount
equal to (i) as to each Class of Offered Certificates, (A) first to the Senior
Certificates, and then to the Class M-1, Class M-2 and Class B Certificates
sequentially, in that order, an amount equal to the Class Principal Balance
thereof plus Current Interest and any Carryforward Interest and (B) to the
extent of available funds (other than funds described in clause (ii) below)
after the distributions in clause (i)(A) above, the amounts referred to and in
the order described in Section 4.02(d)B-H, (ii) as to the Class P
Certificates, the aggregate amount, if any, of all Prepayment Premiums which
remain on deposit in the Collection Accounts and the Certificate Account and
(iii) as to the Class X Certificates, the amount due to the Class X
Certificates under this Agreement which remains unpaid (but in no way
exceeding the amount in the Collection Account).
In the event that any affected Certificateholders shall not surrender
Certificates for cancellation within six months after the date specified in
the above mentioned written notice, the Trustee shall give a second written
notice to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If
within six months after the second notice all the applicable Certificates
shall not have been surrendered for cancellation, the Trustee may take
reasonable and appropriate steps, or may appoint an agent to take reasonable
and appropriate steps, to contact the remaining Certificateholders concerning
surrender of their Certificates, and the cost thereof shall be paid out of the
funds and other assets which remain a part of the Trust Fund. If within one
year after the second notice all Certificates shall not have been surrendered
for cancellation, the Class R Certificateholders shall be entitled to all
unclaimed funds and other assets of the Trust Fund which remain subject hereto
and the Trustee shall be discharged from all further liability with respect to
the Certificates and this Agreement.
SECTION 9.03 Additional Termination Requirements.
(a) In the event Vesta exercises its purchase option with respect to the
Mortgage Loans as provided in Section 9.01, at such time as the Mortgage Loans
are so purchased, the Trust Fund shall be terminated in accordance with the
following additional requirements, unless the Trustee has been provided with
an Opinion of Counsel, at the expense of Vesta, to the effect
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that the failure to comply with the requirements of this Section 9.03 will not
(i) result in the imposition of taxes on "prohibited transactions" on any
REMIC as defined in Section 860E of the Code, or (ii) cause any REMIC to fail
to qualify as a REMIC at any time that any Certificates are outstanding:
(1) Within 90 days prior to the final Distribution Date set
forth in the notice given by the Trustee under Section 9.02, the
Depositor shall prepare and the Trustee shall adopt a plan of
complete liquidation within the meaning of Section 860F(a)(4) of the
Code which, as evidenced by an Opinion of Counsel (which opinion
shall not be an expense of the Trustee or the Trust Fund), meets the
requirements of a qualified liquidation;
(2) Within 90 days after the time of adoption of such a plan of
complete liquidation, the Trustee shall sell all of the assets of
the Trust Fund to the Depositor for cash in accordance with Section
9.01; and
(3) On the date specified for final payment of the
Certificates, the Trustee shall, after payment of any unreimbursed
Advances, Servicing Advances, Servicing Fees or other fee
compensation payable to the Servicer pursuant to this Agreement,
make final distributions of principal and interest on the
Certificates in accordance with Section 4.02 and distribute or
credit, or cause to be distributed or credited, to the Holders of
the Residual Certificates all cash on hand after such final payment
(other than the cash retained to meet claims), and the Trust Fund
(and each REMIC) shall terminate at that time.
(b) The Trustee as agent for each REMIC hereby agrees to adopt and sign
such a plan of complete liquidation upon the written request of the Depositor,
and the receipt of the Opinion of Counsel referred to in Section 9.03(a)(1)
and to take such other action in connection therewith as may be reasonably
requested by the Depositor.
(c) By their acceptance of the Certificates, the Holders thereof hereby
authorize the Depositor to prepare and the Trustee to adopt and sign a plan of
complete liquidation.
106
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.01 Amendment.
This Agreement may be amended from time to time by the Depositor, the
Servicer, the Special Servicer, the Seller and the Trustee without the consent
of any of the Certificateholders (i) to cure any ambiguity or mistake, (ii) to
correct any defective provision herein or to supplement any provision herein
which may be inconsistent with any other provision herein, (iii) to add to the
duties of the Depositor, the Seller, the Special Servicer or the Servicer,
(iv) in connection with the appointment of a successor Servicer or Special
Servicer, to modify, eliminate or add to any of the servicing provisions
contained in this Agreement, providing the Rating Agencies confirm the then
current rating of the Certificates giving effect to such amendment, (v) to add
any other provisions with respect to matters or questions arising hereunder or
(vi) to modify, alter, amend, add to or rescind any of the terms or provisions
contained in this Agreement; and, provided, further, that any action pursuant
to clauses (v) or (vi) above shall not, as evidenced by an Opinion of Counsel
(which Opinion of Counsel shall not be an expense of the Trustee or the Trust
Fund, but shall be at the expense of the party proposing such amendment),
adversely affect in any material respect the interests of any
Certificateholder; provided, however, that no such Opinion of Counsel shall be
required if the Person requesting the amendment obtains a letter from each
Rating Agency stating that the amendment would not result in the downgrading
or withdrawal of the respective ratings then assigned to the Certificates
(without regard to the FSA Policy). The Trustee, the Depositor, the Seller,
the Special Servicer and the Servicer also may at any time and from time to
time amend this Agreement without the consent of the Certificateholders to
modify, eliminate or add to any of its provisions to such extent as shall be
necessary or helpful to (i) maintain the qualification of any REMIC as a REMIC
under the Code, (ii) avoid or minimize the risk of the imposition of any tax
on any REMIC pursuant to the Code that would be a claim at any time prior to
the final redemption of the Certificates or (iii) comply with any other
requirements of the Code; provided, that the Trustee has been provided an
Opinion of Counsel, which opinion shall be an expense of the party requesting
such opinion but in any case shall not be an expense of the Trustee or the
Trust Fund, to the effect that such action is necessary or helpful to, as
applicable, (i) maintain such qualification, (ii) avoid or minimize the risk
of the imposition of such a tax or (iii) comply with any such requirements of
the Code.
Notwithstanding the foregoing, FSA's written consent shall be required
for any amendment that adversely affects in any respect the rights and
interest of FSA hereunder.
This Agreement may also be amended from time to time by the Depositor,
the Servicer, the Special Servicer, the Seller and the Trustee with the
consent of the Holders of each Class of Certificates affected thereby
evidencing 66% of the aggregate Class Principal Balance of such Class for the
purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of this Agreement or of modifying in any manner the
rights of the Holders of Certificates; provided, however, that no such
amendment shall (i) reduce in any manner the amount of, or delay the timing
of, payments required to be distributed on any Certificate without the consent
of the Holder of such Certificate, or (ii) reduce the aforesaid percentages of
107
Certificates the Holders of which are required to consent to any such
amendment, without the consent of the Holders of all such Certificates then
outstanding.
Notwithstanding any contrary provision of this Agreement, the Trustee
shall not consent to any amendment to this Agreement unless it shall have
first received an Opinion of Counsel, which opinion shall not be an expense of
the Trustee or the Trust Fund, but shall be at the expense of the party
requesting such amendment, to the effect that such amendment will not cause
the imposition of any tax on any REMIC or the Certificateholders or cause any
REMIC to fail to qualify as a REMIC at any time that any Certificates are
outstanding.
Promptly after the execution of any amendment to this Agreement requiring
the consent of Certificateholders, the Trustee shall furnish written
notification of the substance or a copy of such amendment to each
Certificateholder and each Rating Agency.
It shall not be necessary for the consent of Certificateholders under
this Section 10.01 to approve the particular form of any proposed amendment,
but it shall be sufficient if such consent shall approve the substance
thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Certificateholders shall be subject
to such reasonable regulations as the Trustee may prescribe.
Nothing in this Agreement shall require the Trustee to enter into an
amendment without receiving an Opinion of Counsel (which Opinion shall not be
an expense of the Trustee or the Trust Fund), satisfactory to the Trustee that
(i) such amendment is permitted and is not prohibited by this Agreement and
that all requirements for amending this Agreement have been complied with; and
(ii) either (A) the amendment does not adversely affect in any material
respect the interests of any Certificateholder or (B) the conclusion set forth
in the immediately preceding clause (A) is not required to be reached pursuant
to this Section 10.01. The Trustee shall have no obligation to consent to any
amendment that it reasonably believes will materially and adversely affect its
rights or immunities under this Agreement.
SECTION 10.02 Recordation of Agreement; Counterparts.
This Agreement is subject to recordation in all appropriate public
offices for real property records in all the counties or other comparable
jurisdictions in which any or all of the properties subject to the Mortgages
are situated, and in any other appropriate public recording office or
elsewhere, such recordation to be effected by the Depositor at its expense,
but only upon direction by the Trustee (acting at the direction of holders of
Certificates evidencing a majority of the aggregate Class Principal Balance)
accompanied by an Opinion of Counsel (at the Depositor's expense) to the
effect that such recordation materially and beneficially affects the interests
of the Certificateholders.
For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one
and the same instrument.
108
SECTION 10.03 Governing Law.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
SUBSTANTIVE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO
BE PERFORMED IN THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND REMEDIES
OF THE PARTIES HERETO AND THE CERTIFICATEHOLDERS SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
SECTION 10.04 Intention of Parties.
It is the express intent of the parties hereto that the conveyance of the
Trust Fund, including the Mortgage Loans, by the Depositor to the Trustee be,
and be construed as, an absolute sale thereof. It is, further, not the
intention of the parties that such conveyance be deemed a pledge thereof.
However, in the event that, notwithstanding the intent of the parties, such
assets are held to be the property of the Depositor, or if for any other
reason this Agreement is held or deemed to create a security interest in
either such assets, then (i) this Agreement shall be deemed to be a security
agreement within the meaning of the Uniform Commercial Code of the State of
New York and (ii) the conveyance provided for in this Agreement shall be
deemed to be an assignment and a grant by the Depositor to the Trustee, for
the benefit of the Certificateholders, of a security interest in all of the
assets transferred, whether now owned or hereafter acquired.
The Depositor for the benefit of the Certificateholders shall, to the
extent consistent with this Agreement, take such actions as may be necessary
to ensure that, if this Agreement were deemed to create a security interest in
the Trust Fund, such security interest would be deemed to be a perfected
security interest of first priority under applicable law and will be
maintained as such throughout the term of the Agreement. The Depositor shall
arrange for filing any Uniform Commercial Code continuation statements in
connection with any security interest granted or assigned to the Trustee for
the benefit of the Certificateholders.
SECTION 10.05 Notices.
The Trustee shall use its best efforts to promptly provide notice to each
Rating Agency with respect to each of the following of which it has actual
knowledge:
1. Any material change or amendment to this Agreement;
2. The occurrence of any Event of Default that has not been cured;
3. The resignation or termination of the Servicer or the Trustee and the
appointment of any successor;
4. The repurchase or substitution of Mortgage Loans pursuant to Sections
2.02 and 2.03; and
5. The final payment to Certificateholders.
109
In addition, the Trustee shall promptly furnish to each Rating Agency
copies of the following:
1. Each report to Certificateholders described in Section 4.05 and 3.21;
2. Each annual statement as to compliance described in Section 3.17;
3. Each annual independent public accountants' servicing report described
in Section 3.18; and
4. Any notice of a purchase of a Mortgage Loan pursuant to Section 2.02,
2.03 or 3.11.
All directions, demands and notices hereunder shall be in writing and
shall be deemed to have been duly given when delivered to (a) in the case of
the Depositor, 1l Madison Avenue, 4th Floor, New York, New York 10010,
Attention: Xxxxxxx X. Xxxxxx (with a copy to Credit Suisse First Boston
Mortgage Securities Corp., 00 Xxxxxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Office of the General Counsel), (b) in the case of the
Trustee, at the Corporate Trust Office or such other address as the Trustee
may hereafter furnish to the Depositor and the Servicer, (c) in the case of
each of the Rating Agencies, the address specified therefor in the definition
corresponding to the name of such Rating Agency and (d) in the case of Vesta,
Vesta Servicing L.P., 0000 Xxxxx Xxxxx Xxxxx, Xxxxx 000-X Xxxxxx, Xxxxx 00000,
Attention: Xxxx Xxxx. Notices to Certificateholders shall be deemed given when
mailed, first class postage prepaid, to their respective addresses appearing
in the Certificate Register.
SECTION 10.06 Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and
shall in no way affect the validity or enforceability of the other provisions
of this Agreement or of the Certificates or the rights of the Holders thereof.
SECTION 10.07 Assignment.
Notwithstanding anything to the contrary contained herein, except as
provided in Sections 6.02 and 6.04, this Agreement may not be assigned by the
Servicer without the prior written consent of the Trustee and Depositor.
SECTION 10.08 Limitation on Rights of Certificateholders.
The death or incapacity of any Certificateholder shall not operate to
terminate this Agreement or the trust created hereby, nor entitle such
Certificateholder's legal representative or heirs to claim an accounting or to
take any action or commence any proceeding in any court for a petition or
winding up of the trust created hereby, or otherwise affect the rights,
obligations and liabilities of the parties hereto or any of them.
No Certificateholder shall have any right to vote (except as provided
herein) or in any manner otherwise control the operation and management of the
Trust Fund, or the obligations of
110
the parties hereto, nor shall anything herein set forth or contained in the
terms of the Certificates be construed so as to constitute the
Certificateholders from time to time as partners or members of an association;
nor shall any Certificateholder be under any liability to any third party by
reason of any action taken by the parties to this Agreement pursuant to any
provision hereof.
No Certificateholder shall have any right by virtue or by availing itself
of any provisions of this Agreement to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this
Agreement, unless such Holder previously shall have given to the Trustee a
written notice of an Event of Default and of the continuance thereof, as
herein provided, and unless the Holders of Certificates evidencing not less
than 25% of the Voting Rights evidenced by the Certificates shall also have
made written request to the Trustee to institute such action, suit or
proceeding in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the costs,
expenses, and liabilities to be incurred therein or thereby, and the Trustee,
for 60 days after its receipt of such notice, request and offer of indemnity
shall have neglected or refused to institute any such action, suit or
proceeding; it being understood and intended, and being expressly covenanted
by each Certificateholder with every other Certificateholder and the Trustee,
that no one or more Holders of Certificates shall have any right in any manner
whatever by virtue or by availing itself or themselves of any provisions of
this Agreement to affect, disturb or prejudice the rights of the Holders of
any other of the Certificates, or to obtain or seek to obtain priority over or
preference to any other such Holder or to enforce any right under this
Agreement, except in the manner herein provided and for the common benefit of
all Certificateholders. For the protection and enforcement of the provisions
of this Section 10.08, each and every Certificateholder and the Trustee shall
be entitled to such relief as can be given either at law or in equity.
SECTION 10.09 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 10.10 Protection of Assets.
(a) Except for transactions and activities entered into in connection
with the securitization that is the subject of this agreement, the trust
created by this agreement is not authorized and has no power to:
(i) borrow money or issue debt;
(ii) merge with another entity, reorganize, liquidate or sell
assets; or
(iii) engage in any business or activities.
(b) Each party to this agreement agrees that it will not file an
involuntary bankruptcy petition against the Trust Fund or initiate any other
form of insolvency proceeding until after the Certificates have been paid.
110
IN WITNESS WHEREOF, the Depositor, the Trustee, the Seller and the
Servicer have caused their names to be signed hereto by their respective
officers thereunto duly authorized as of the day and year first above written.
CREDIT SUISSE FIRST BOSTON MORTGAGE
SECURITIES CORP.,
as Depositor
By: /s/ Xxxxxxx Xxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxx
Title: Vice President
U.S. BANK NATIONAL ASSOCIATION, not in
its individual capacity but
solely as Trustee
By: /s/ Xxxxx Xxxxxxxxxxxxxx
------------------------------------
Name: Xxxxx Xxxxxxxxxxxxxx
Title: Vice President
DLJ MORTGAGE CAPITAL, INC.,
as the Seller
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
VESTA SERVICING L.P.,
as the Servicer and Special Servicer
By: /s/ Xxxx Xxxx
------------------------------------
Name: Xxxx Xxxx
Title: Vice President and COO
000
XXXXX XX XXX XXXX )
: ss.:
COUNTY OF NEW YORK )
On this 26th day of November, 2001, before me, personally appeared
Healaine Xxxxxx, known to me to be a Vice President of Credit Suisse First
Boston Mortgage Securities Corp., one of the corporations that executed the
within instrument, and also known to me to be the person who executed it on
behalf of said 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.
/s/ Xxxxxx Xxxxx
-----------------------------
Notary Public
[NOTARIAL SEAL]
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
On the 26th day of November, 2001, before me, personally appeared Xxxxx
Xxxxxx, known to me to be a Vice President of DLJ Mortgage Capital, Inc., one
of the corporations that executed the within instrument and also known to me
to be the person who executed it on behalf of said 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.
/s/ Xxxxxxxx Xxxxx Xxxxxxx
-----------------------------
Notary Public
[NOTARIAL SEAL]
STATE OF )
: ss.:
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
On the 20th of August 2001 before me, a Notary Public in and for said
State, personally appeared X. Xxxxxxxxxxxxxx known to me to be a Vice
President of U.S. Bank National Association, the national banking association
that executed the within instrument and also known to me to be the person who
executed it on behalf of said 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.
/s/ Xxxxx X. Xxxxxxx
-----------------------------
Notary Public
[NOTARIAL SEAL]
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
On the 31st of December, 2001 before me, a Notary Public in and for said
State, personally appeared Xxxx Xxxx known to me to be a President of
Vesta Servicing L.P., the Delaware limited partnership that executed the
within instrument and also known to me to be the person who executed it on
behalf of said 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.
/s/ Xxxxxx Xxxxxx
-----------------------------
Notary Public
[NOTARIAL SEAL]
EXHIBIT A
[FORM OF CLASS A-[o] CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE").
A-1
Certificate No. :
Cut-off Date : August 1, 2001
First Distribution Date : September 25, 2001
Initial Certificate Principal Balance
of this Certificate
("Denomination") :
Initial Certificate Principal Balances
of all Certificates
of this Class :
CUSIP :
Pass-Through Rate :
Maturity Date :
A-2
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
CSFB ABS Trust Series 2001-HE17
CSFB Mortgage Pass-Through Certificates, Series 2001-HE17
Class A-[o]
evidencing a percentage interest in the distributions allocable to
the Certificates of the above-referenced Class with respect to a
Trust Fund consisting primarily of a pool of fixed rate and
adjustable rate conventional mortgage loans (the "Mortgage Loans")
secured by first liens on one- to four-family residential properties.
Credit Suisse First Boston Mortgage Securities Corp., as Depositor
Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Principal Balance at any time may
be less than the Certificate Principal Balance as set forth herein. This
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Seller, the Servicer or the Trustee referred
to below or any of their respective affiliates. Neither this Certificate nor
the Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
This certifies that CEDE & CO. is the registered owner of the Percentage
Interest evidenced by this Certificate (obtained by dividing the denomination
of this Certificate by the aggregate of the denominations of all Certificates
of the Class to which this Certificate belongs) in certain monthly
distributions with respect to a Trust Fund consisting primarily of the
Mortgage Loans deposited by Credit Suisse First Boston Mortgage Securities
Corp. (the "Depositor"). The Trust Fund was created pursuant to a Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
"Agreement") among the Depositor, DLJ Mortgage Capital, Inc., as seller (in
such capacity, "Seller"), Vesta Servicing L.P., as servicer (the "Servicer")
and U.S. Bank National Association as trustee (the "Trustee"). To the extent
not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement
or be valid for any purpose unless manually countersigned by an authorized
signatory of the Trustee.
A-3
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: August 23, 2001.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: ________________________________________
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Date: August 23, 2001
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: ___________________________
Authorized Signatory
A-4
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
CSFB ABS Trust Series 2001-HE17
CSFB Mortgage Pass-Through Certificates, Series 2001-HE17
Class A-[o]
This Certificate is one of a duly authorized issue of Certificates
designated as CSFB ABS Trust Series 2001-HE17, CSFB Mortgage Pass-Through
Certificates, Series 2001-HE17, of the Series specified on the face hereof
(herein collectively called the "Certificates"), and representing a beneficial
ownership interest in the Trust Fund created by the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Certificate Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee.
Pursuant to the terms of the Agreement, a distribution will be made on
the 25th day of each month, or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified on the face hereof, to the Person in
whose name this Certificate is registered at the close of business on the
applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be
distributed to Holders of Certificates of the Class to which this Certificate
belongs on such Distribution Date pursuant to the Agreement. The Record Date
applicable to each Distribution Date is (1) with respect to all Definitive
Certificates, the last day of the calendar month preceding the month in which
such Distribution Date occurs and (2) with respect to all Certificates held in
Book-Entry Form only, the Business Day immediately preceding the Distribution
Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the Corporate Trust Office or
such other location specified in the notice to Certificateholders of such
final distribution.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any
time by the Depositor, the Servicer, the Seller and the Trustee with the
consent of the Holders of Certificates affected by such amendment evidencing
the requisite Percentage Interest, as provided in the Agreement. Any such
consent by
A-5
the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange therefor or in lieu hereof whether or
not notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the Corporate Trust Office or the office or agency maintained by
the Trustee in [St. Xxxx, Minnesota], accompanied by a written instrument of
transfer in form satisfactory to the Trustee and the Certificate Registrar
duly executed by the holder hereof or such holder's attorney duly authorized
in writing, and thereupon one or more new Certificates of the same Class in
authorized denominations and evidencing the same aggregate Percentage Interest
in the Trust Fund will be issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations and evidencing the same aggregate Percentage Interest, as
requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Depositor, the Servicer, the Seller, and the Trustee and any agent of
the Depositor or the Trustee may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes, and none of
the Servicer, the Seller, the Depositor, the Trustee or any such agent shall
be affected by any notice to the contrary.
On any Distribution Date on which the aggregate Stated Principal Balance
of the Mortgage Loans is less than 10% of the Aggregate Loan Balance as of the
Cut-off Date and the amount on deposit in the Prefunding Account on the
Closing Date, the Servicer will have the option to repurchase, in whole, from
the Trust Fund all remaining Mortgage Loans and all property acquired in
respect of the Mortgage Loans at a purchase price determined as provided in
the Agreement. In the event that no such optional termination occurs, the
obligations and responsibilities created by the Agreement will terminate upon
the later of the maturity or other liquidation (or any advance with respect
thereto) of the last Mortgage Loan remaining in the Trust Fund or the
disposition of all property in respect thereof and the distribution to
Certificateholders of all amounts required to be distributed pursuant to the
Agreement. In no event, however, will the trust created by the Agreement
continue beyond the expiration of 21 years from the death of the last survivor
of the descendants living at the date of the Agreement of a certain person
named in the Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
A-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _____________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to
assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such
Certificate to the following address:
______________________________________________________________________________
Dated:
______________________________________________
Signature by or on behalf of assignor
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _______________________________________________
_____________________________________________________________________________,
for the account of __________________________________________________________,
account number _______________, or, if mailed by check, to ___________________
______________________________________________________________________________
_____________________________________________________________________________.
Applicable statements should be mailed to ____________________________________
______________________________________________________________________________
_____________________________________________________________________________.
This information is provided by, the assignee named above, or, as its agent.
A-7
EXHIBIT B
[FORM OF CLASS M CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE").
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO CERTAIN CERTIFICATES
AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
[For ERISA Restricted Certificates:]
[NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS
THE TRANSFEREE DELIVERS TO THE TRUSTEE EITHER A REPRESENTATION LETTER TO THE
EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR A
PLAN SUBJECT TO SECTION 4975 OF THE CODE, OR, IF THE PURCHASER IS AN INSURANCE
COMPANY, A REPRESENTATION IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT
REFERRED TO HEREIN OR AN OPINION OF COUNSEL IN ACCORDANCE WITH THE PROVISIONS
OF THE AGREEMENT REFERRED TO HEREIN. NOTWITHSTANDING ANYTHING ELSE TO THE
CONTRARY HEREIN, ANY PURPORTED TRANSFER OF THIS CERTIFICATE TO OR ON BEHALF OF
AN EMPLOYEE BENEFIT PLAN SUBJECT TO ERISA OR TO THE CODE WITHOUT THE OPINION
OF COUNSEL SATISFACTORY TO THE TRUSTEE AS DESCRIBED ABOVE SHALL BE VOID AND OF
NO EFFECT.]
[For Private Certificates:]
[THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED ("THE ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE ACT MAY ONLY BE MADE IN A TRANSACTION EXEMPTED
FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE
PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.]
B-1
Certificate No. :
Cut-off Date : August 1, 2001
First Distribution Date : September 25, 2001
Initial Certificate Principal Balance
of this Certificate
("Denomination") :
Initial Certificate Principal Balances
of all Certificates
of this Class :
CUSIP :
Interest Rate :
Maturity Date :
B-2
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
CSFB ABS Trust Series 2001-HE17
CSFB Mortgage-Backed Pass-Through Certificates, Series 2001-HE17
Class M
evidencing a percentage interest in the distributions allocable to the
Certificates of the above-referenced Class with respect to a Trust Fund
consisting primarily of a pool of fixed rate and adjustable rate
conventional mortgage loans (the "Mortgage Loans") secured by first
liens on one- to four-family residential properties.
Credit Suisse First Boston Mortgage Securities Corp., as Depositor
Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Principal Balance at any time may
be less than the Certificate Principal Balance as set forth herein. This
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Seller, the Servicer, or the Trustee referred
to below or any of their respective affiliates. Neither this Certificate nor
the Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
This certifies that CEDE & CO. is the registered owner of the Percentage
Interest evidenced by this Certificate (obtained by dividing the denomination
of this Certificate by the aggregate of the denominations of all Certificates
of the Class to which this Certificate belongs) in certain monthly
distributions with respect to a Trust Fund consisting primarily of the
Mortgage Loans deposited by Credit Suisse First Boston Mortgage Securities
Corp. (the "Depositor"). The Trust Fund was created pursuant to a Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
"Agreement") among the Depositor, DLJ Mortgage Capital, Inc., as seller (in
such capacity, "Seller"), Vesta Servicing L.P., as servicer (the "Servicer")
and U.S. Bank National Association as trustee (the "Trustee"). To the extent
not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
[For ERISA Restricted Certificates:]
[No transfer of a Certificate of this Class shall be made unless the
Trustee shall have received either (i) a representation letter from the
transferee of such Certificate, acceptable to and in form and substance
satisfactory to the Trustee, to the effect that such transferee is not an
employee benefit plan subject to Section 406 of ERISA or Section 4975 of the
Code, or a person acting on behalf of any such plan or arrangement or using
the assets of any such plan or arrangement to effect such transfer, which
representation letter shall not be an expense of the Trustee or the Trust
Fund, (ii) if the purchaser is an insurance company, a representation that the
purchaser is an insurance company which is purchasing such Certificates with
funds contained in an "insurance company general account" (as such term is
defined in Section V(e) of Prohibited Transaction Class Exemption 95-60 ("PTCE
95-60")) and that the purchase and holding of such
B-3
Certificates satisfy the requirements for exemptive relief under Sections I
and III of PTCE 95-60 or (iii) in the case of any such Certificate presented
for registration in the name of an employee benefit plan subject to ERISA, or
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 or arrangement, or using such plan's or arrangement's
assets, an Opinion of Counsel satisfactory to the Trustee to the effect that
the purchase or holding of such Certificate will not result in the assets of
the Trust Fund being deemed to be "plan assets" and subject to the prohibited
transaction provisions of ERISA and the Code and will not subject the Trustee
or the Servicer to any obligation in addition to those undertaken in this
Agreement, which Opinion of Counsel shall not be an expense of the Trustee or
the Trust Fund. Notwithstanding anything else to the contrary herein, any
purported transfer of a Certificate to or on behalf of an employee benefit
plan subject to ERISA or to the Code without the Opinion of Counsel
satisfactory to the Trustee as described above shall be void and of no
effect.]
Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement
or be valid for any purpose unless manually countersigned by an authorized
signatory of the Trustee.
B-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: August 23, 2001.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:_________________________________________
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Date: August 23, 2001
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: ___________________________
Authorized Signatory
B-5
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
CSFB ABS Trust Series 2001-HE17
CSFB Mortgage- Pass-Through Certificates, Series 2001-HE17
Class M
This Certificate is one of a duly authorized issue of Certificates
designated as CSFB ABS Trust Series 2001-HE17, CSFB Mortgage Securities Corp.,
Mortgage Pass-Through Certificates, Series 2001-HE17, of the Series specified
on the face hereof (herein collectively called the "Certificates"), and
representing a beneficial ownership interest in the Trust Fund created by the
Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Certificate Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee.
Pursuant to the terms of the Agreement, a distribution will be made on
the 25th day of each month, or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified on the face hereof, to the Person in
whose name this Certificate is registered at the close of business on the
applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be
distributed to Holders of Certificates of the Class to which this Certificate
belongs on such Distribution Date pursuant to the Agreement. The Record Date
applicable to each Distribution Date is (1) with respect to all Definitive
Certificates, the last day of the calendar month preceding the month in which
such Distribution Date occurs and (2) with respect to all Certificates held in
Book-Entry Form only, the Business Day immediately preceding the Distribution
Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the Corporate Trust Office or
such other location specified in the notice to Certificateholders of such
final distribution.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any
time by the Depositor, the Servicer, the Seller and the Trustee with the
consent of the Holders of Certificates affected by such amendment
B-6
evidencing the requisite Percentage Interest, as provided in the Agreement.
Any such consent by the Holder of this Certificate shall be conclusive and
binding on such Holder and upon all future Holders of this Certificate and of
any Certificate issued upon the transfer hereof or in exchange therefor or in
lieu hereof whether or not notation of such consent is made upon this
Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the Corporate Trust Office or the office or agency maintained by
the Trustee in [St. Xxxx, Minnesota], accompanied by a written instrument of
transfer in form satisfactory to the Trustee and the Certificate Registrar
duly executed by the holder hereof or such holder's attorney duly authorized
in writing, and thereupon one or more new Certificates of the same Class in
authorized denominations and evidencing the same aggregate Percentage Interest
in the Trust Fund will be issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations and evidencing the same aggregate Percentage Interest, as
requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Servicer, FSA and the Trustee and any agent of the Servicer, FSA or
the Trustee may treat the Person in whose name this Certificate is registered
as the owner hereof for all purposes, and none of the Servicer, FSA, the
Trustee, or any such agent shall be affected by any notice to the contrary.
The Depositor, the Servicer, the Seller, the Trustee and any agent of the
Depositor or the Trustee may treat the Person in whose name this Certificate
is registered as the owner hereof for all purposes, and none of the Servicer,
the Seller, the Depositor, the Trustee or any such agent shall be affected by
any notice to the contrary.
On any Distribution Date on which the aggregate Stated Principal Balance
of the Mortgage Loans is less than 10% of the Aggregate Loan Balance as of the
Cut-off Date, and the amount on deposit in the Prefunding Account on the
Closing Date, the Servicer will have the option to repurchase, in whole, from
the Trust Fund all remaining Mortgage Loans and all property acquired in
respect of the Mortgage Loans at a purchase price determined as provided in
the Agreement. In the event that no such optional termination occurs, the
obligations and responsibilities created by the Agreement will terminate upon
the later of the maturity or other liquidation (or any advance with respect
thereto) of the last Mortgage Loan remaining in the Trust Fund or the
disposition of all property in respect thereof and the distribution to
Certificateholders of all amounts required to be distributed pursuant to the
Agreement. In no
B-7
event, however, will the trust created by the Agreement continue beyond the
expiration of 21 years from the death of the last survivor of the descendants
living at the date of the Agreement of a certain person named in the
Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
B-8
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _____________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to
assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such
Certificate to the following address:
______________________________________________________________________________
Dated:
______________________________________________
Signature by or on behalf of assignor
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _______________________________________________
_____________________________________________________________________________,
for the account of __________________________________________________________,
account number _______________, or, if mailed by check, to ___________________
______________________________________________________________________________
_____________________________________________________________________________.
Applicable statements should be mailed to ____________________________________
______________________________________________________________________________
_____________________________________________________________________________.
This information is provided by, the assignee named above, or, as its agent.
B-9
EXHIBIT C
[FORM OF CLASS B CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE").
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO CERTAIN CERTIFICATES
AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
[For ERISA Restricted Certificates:]
[NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS
THE TRANSFEREE DELIVERS TO THE TRUSTEE EITHER A REPRESENTATION LETTER TO THE
EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR A
PLAN SUBJECT TO SECTION 4975 OF THE CODE, OR, IF THE PURCHASER IS AN INSURANCE
COMPANY, A REPRESENTATION IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT
REFERRED TO HEREIN OR AN OPINION OF COUNSEL IN ACCORDANCE WITH THE PROVISIONS
OF THE AGREEMENT REFERRED TO HEREIN. NOTWITHSTANDING ANYTHING ELSE TO THE
CONTRARY HEREIN, ANY PURPORTED TRANSFER OF THIS CERTIFICATE TO OR ON BEHALF OF
AN EMPLOYEE BENEFIT PLAN SUBJECT TO ERISA OR TO THE CODE WITHOUT THE OPINION
OF COUNSEL SATISFACTORY TO THE TRUSTEE AS DESCRIBED ABOVE SHALL BE VOID AND OF
NO EFFECT.]
[For Private Certificates:]
[THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED ("THE ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE ACT MAY ONLY BE MADE IN A TRANSACTION EXEMPTED
FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE
PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.]
C-1
Certificate No. :
Cut-off Date : August 1, 2001
First Distribution Date : September 25, 2001
Initial Certificate Principal Balance
of this Certificate
("Denomination") :
Initial Certificate Principal Balances
of all Certificates
of this Class :
CUSIP :
Interest Rate :
Maturity Date :
C-2
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
CSFB ABS Trust Series 2001-HE17
CSFB Mortgage-Backed Pass-Through Certificates, Series 2001-HE17
Class B
evidencing a percentage interest in the distributions allocable to the
Certificates of the above-referenced Class with respect to a Trust Fund
consisting primarily of a pool of fixed rate and adjustable rate
conventional mortgage loans (the "Mortgage Loans") secured by first
liens on one- to four-family residential properties.
Credit Suisse First Boston Mortgage Securities Corp., as Depositor
Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Principal Balance at any time may
be less than the Certificate Principal Balance as set forth herein. This
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Seller, the Servicer, or the Trustee referred
to below or any of their respective affiliates. Neither this Certificate nor
the Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
This certifies that CEDE & CO. is the registered owner of the Percentage
Interest evidenced by this Certificate (obtained by dividing the denomination
of this Certificate by the aggregate of the denominations of all Certificates
of the Class to which this Certificate belongs) in certain monthly
distributions with respect to a Trust Fund consisting primarily of the
Mortgage Loans deposited by Credit Suisse First Boston Mortgage Securities
Corp. (the "Depositor"). The Trust Fund was created pursuant to a Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
"Agreement") among the Depositor, DLJ Mortgage Capital, Inc., as seller (in
such capacity, "Seller"), Vesta Servicing L.P., as servicer (the "Servicer")
and U.S. Bank National Association as trustee (the "Trustee"). To the extent
not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
[For ERISA Restricted Certificates:]
[No transfer of a Certificate of this Class shall be made unless the
Trustee shall have received either (i) a representation letter from the
transferee of such Certificate, acceptable to and in form and substance
satisfactory to the Trustee, to the effect that such transferee is not an
employee benefit plan subject to Section 406 of ERISA or Section 4975 of the
Code, or a person acting on behalf of any such plan or arrangement or using
the assets of any such plan or arrangement to effect such transfer, which
representation letter shall not be an expense of the Trustee or the Trust
Fund, (ii) if the purchaser is an insurance company, a representation that the
purchaser is an insurance company which is purchasing such Certificates with
funds contained in an "insurance company general account" (as such term is
defined in Section V(e) of Prohibited Transaction Class Exemption 95-60 ("PTCE
95-60")) and that the purchase and holding of such
C-3
Certificates satisfy the requirements for exemptive relief under Sections I
and III of PTCE 95-60 or (iii) in the case of any such Certificate presented
for registration in the name of an employee benefit plan subject to ERISA, or
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 or arrangement, or using such plan's or arrangement's
assets, an Opinion of Counsel satisfactory to the Trustee to the effect that
the purchase or holding of such Certificate will not result in the assets of
the Trust Fund being deemed to be "plan assets" and subject to the prohibited
transaction provisions of ERISA and the Code and will not subject the Trustee
or the Servicer to any obligation in addition to those undertaken in this
Agreement, which Opinion of Counsel shall not be an expense of the Trustee or
the Trust Fund. Notwithstanding anything else to the contrary herein, any
purported transfer of a Certificate to or on behalf of an employee benefit
plan subject to ERISA or to the Code without the Opinion of Counsel
satisfactory to the Trustee as described above shall be void and of no
effect.]
Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement
or be valid for any purpose unless manually countersigned by an authorized
signatory of the Trustee.
C=4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: August 23, 2001.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:_________________________________________
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Date: August 23, 2001
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: ___________________________
Authorized Signatory
C-5
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
CSFB ABS Trust Series 2001-HE17
CSFB Mortgage- Pass-Through Certificates, Series 2001-HE17
Class B
This Certificate is one of a duly authorized issue of Certificates
designated as CSFB ABS Trust Series 2001-HE17, CSFB Mortgage Securities Corp.,
Mortgage Pass-Through Certificates, Series 2001-HE17, of the Series specified
on the face hereof (herein collectively called the "Certificates"), and
representing a beneficial ownership interest in the Trust Fund created by the
Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Certificate Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee.
Pursuant to the terms of the Agreement, a distribution will be made on
the 25th day of each month, or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified on the face hereof, to the Person in
whose name this Certificate is registered at the close of business on the
applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be
distributed to Holders of Certificates of the Class to which this Certificate
belongs on such Distribution Date pursuant to the Agreement. The Record Date
applicable to each Distribution Date is (1) with respect to all Definitive
Certificates, the last day of the calendar month preceding the month in which
such Distribution Date occurs and (2) with respect to all Certificates held in
Book-Entry Form only, the Business Day immediately preceding the Distribution
Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the Corporate Trust Office or
such other location specified in the notice to Certificateholders of such
final distribution.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any
time by the Depositor, the Servicer, the Seller and the Trustee with the
consent of the Holders of Certificates affected by such amendment
C-6
evidencing the requisite Percentage Interest, as provided in the Agreement.
Any such consent by the Holder of this Certificate shall be conclusive and
binding on such Holder and upon all future Holders of this Certificate and of
any Certificate issued upon the transfer hereof or in exchange therefor or in
lieu hereof whether or not notation of such consent is made upon this
Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the Corporate Trust Office or the office or agency maintained by
the Trustee in [St. Xxxx, Minnesota], accompanied by a written instrument of
transfer in form satisfactory to the Trustee and the Certificate Registrar
duly executed by the holder hereof or such holder's attorney duly authorized
in writing, and thereupon one or more new Certificates of the same Class in
authorized denominations and evidencing the same aggregate Percentage Interest
in the Trust Fund will be issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations and evidencing the same aggregate Percentage Interest, as
requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Servicer, FSA and the Trustee and any agent of the Servicer, FSA or
the Trustee may treat the Person in whose name this Certificate is registered
as the owner hereof for all purposes, and none of the Servicer, FSA, the
Trustee, or any such agent shall be affected by any notice to the contrary.
The Depositor, the Servicer, the Seller, the Trustee and any agent of the
Depositor or the Trustee may treat the Person in whose name this Certificate
is registered as the owner hereof for all purposes, and none of the Servicer,
the Seller, the Depositor, the Trustee or any such agent shall be affected by
any notice to the contrary.
On any Distribution Date on which the aggregate Stated Principal Balance
of the Mortgage Loans is less than 10% of the Aggregate Loan Balance as of the
Cut-off Date, and the amount on deposit in the Prefunding Account on the
Closing Date, the Servicer will have the option to repurchase, in whole, from
the Trust Fund all remaining Mortgage Loans and all property acquired in
respect of the Mortgage Loans at a purchase price determined as provided in
the Agreement. In the event that no such optional termination occurs, the
obligations and responsibilities created by the Agreement will terminate upon
the later of the maturity or other liquidation (or any advance with respect
thereto) of the last Mortgage Loan remaining in the Trust Fund or the
disposition of all property in respect thereof and the distribution to
Certificateholders of all amounts required to be distributed pursuant to the
Agreement. In no
C-7
event, however, will the trust created by the Agreement continue beyond the
expiration of 21 years from the death of the last survivor of the descendants
living at the date of the Agreement of a certain person named in the
Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
C-8
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _____________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to
assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such
Certificate to the following address:
______________________________________________________________________________
Dated:
______________________________________________
Signature by or on behalf of assignor
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _______________________________________________
_____________________________________________________________________________,
for the account of __________________________________________________________,
account number _______________, or, if mailed by check, to ___________________
______________________________________________________________________________
_____________________________________________________________________________.
Applicable statements should be mailed to ____________________________________
______________________________________________________________________________
_____________________________________________________________________________.
This information is provided by, the assignee named above, or, as its agent.
C-9
EXHIBIT D
[FORM OF CLASS R CERTIFICATE]
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, AS AMENDED (THE "CODE").
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEREE DELIVERS TO THE TRUSTEE A TRANSFER AFFIDAVIT IN ACCORDANCE
WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE DELIVERS TO THE TRUSTEE EITHER A REPRESENTATION LETTER TO THE
EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR A
PLAN SUBJECT TO SECTION 4975 OF THE CODE, OR, IF THE PURCHASER IS AN INSURANCE
COMPANY, A REPRESENTATION IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT
REFERRED TO HEREIN, OR AN OPINION OF COUNSEL IN ACCORDANCE WITH THE PROVISIONS
OF THE AGREEMENT REFERRED TO HEREIN. NOTWITHSTANDING ANYTHING ELSE TO THE
CONTRARY HEREIN, ANY PURPORTED TRANSFER OF THIS CERTIFICATE TO OR ON BEHALF OF
AN EMPLOYEE BENEFIT PLAN SUBJECT TO ERISA OR TO THE CODE WITHOUT THE OPINION
OF COUNSEL SATISFACTORY TO THE TRUSTEE AS DESCRIBED ABOVE SHALL BE VOID AND OF
NO EFFECT.
D-1
Certificate No. :
Cut-off Date : August 1, 2001
First Distribution Date : September 25, 2001
Initial Certificate Principal Balance
of this Certificate
("Denomination") : $
Initial Certificate Principal Balances
of all Certificates
of this Class : $
CUSIP :
Pass-Through Rate :
Maturity Date :
D-2
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
CSFB ABS Trust Series 2001-HE17
CSFB Mortgage Pass-Through Certificates, Series 2001-HE17
Class R
evidencing a percentage interest in the distributions allocable to the
Class R Certificates with respect to a Trust Fund consisting primarily
of a pool of fixed rate and adjustable rate conventional mortgage loans
(the "Mortgage Loans") secured by first liens on one- to four-family
residential properties.
Credit Suisse First Boston Mortgage Securities Corp., as Depositor
Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Principal Balance at any time may
be less than the Certificate Principal Balance as set forth herein. This
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Seller, the Servicer or the Trustee referred
to below or any of their respective affiliates. Neither this Certificate nor
the Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
This certifies that Credit Suisse First Boston Corporation, is the
registered owner of the Percentage Interest evidenced by this Certificate
(obtained by dividing the denomination of this Certificate by the aggregate of
the denominations of all Certificates of the Class to which this Certificate
belongs) in certain monthly distributions with respect to a Trust Fund
consisting primarily of the Mortgage Loans deposited by Credit Suisse First
Boston Mortgage Securities Corp. (the "Depositor"). The Trust Fund was created
pursuant to a Pooling and Servicing Agreement dated as of the Cut-off Date
specified above (the "Agreement") among the Depositor, DLJ Mortgage Capital,
Inc., as seller (in such capacity, "Seller"), Vesta Servicing L.P., as
servicer (the "Servicer") and U.S. Bank National Association as trustee (the
"Trustee"). To the extent not defined herein, the capitalized terms used
herein have the meanings assigned in the Agreement. This Certificate is issued
under and is subject to the terms, provisions and conditions of the Agreement,
to which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Any distribution of the proceeds of any remaining assets of the Trust
Fund will be made only upon presentment and surrender of this Class R
Certificate at the Corporate Trust Office or the office or agency maintained
by the Trustee in New York, New York.
No transfer of a Class R Certificate shall be made unless the Trustee
shall have received either (i) a representation letter from the transferee of
such Certificate, acceptable to and in form and substance satisfactory to the
Trustee, to the effect that such transferee is not an employee benefit plan
subject to Section 406 of ERISA or Section 4975 of the Code, or a person
acting on behalf of any such plan or arrangement or using the assets of any
such plan or arrangement to effect such transfer, which representation letter
shall not be an expense of the Trustee or the Trust Fund, (ii) if the
purchaser is an insurance company, a representation that the purchaser is an
insurance company which is purchasing such Certificates with funds contained
in an "insurance company general account" (as such term is defined in Section
V(e) of Prohibited
D-3
Transaction Class Exemption 95-60 ("PTCE 95-60")) and that the purchase and
holding of such Certificates satisfy the requirements for exemptive relief
under Sections I and III of PTCE 95-60, or (iii) in the case of any such Class
R Certificate presented for registration in the name of an employee benefit
plan subject to ERISA, or 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 or arrangement, or using such plan's
or arrangement's assets, an Opinion of Counsel satisfactory to the Trustee to
the effect that the purchase or holding of such Class R Certificate will not
result in the assets of the Trust Fund being deemed to be "plan assets" and
subject to the prohibited transaction provisions of ERISA and the Code and
will not subject the Trustee to any obligation in addition to those undertaken
in this Agreement, which Opinion of Counsel shall not be an expense of the
Trustee or the Trust Fund. Notwithstanding anything else to the contrary
herein, any purported transfer of a Class R Certificate to or on behalf of an
employee benefit plan subject to ERISA or to the Code without the Opinion of
Counsel satisfactory to the Trustee as described above shall be void and of no
effect.
Each Holder of this Class R Certificate will be deemed to have agreed to
be bound by the restrictions of the Agreement, including but not limited to
the restrictions that (i) each person holding or acquiring any Ownership
Interest in this Class R Certificate must be a Permitted Transferee, (ii) no
Ownership Interest in this Class R Certificate may be transferred without
delivery to the Trustee of a transfer affidavit of the initial owner or the
proposed transferee in the form described in the Agreement, (iii) each person
holding or acquiring any Ownership Interest in this Class R Certificate must
agree to require a transfer affidavit from any other person to whom such
person attempts to Transfer its Ownership Interest in this Class R Certificate
as required pursuant to the Agreement, (iv) each person holding or acquiring
an Ownership Interest in this Class R Certificate must agree not to transfer
an Ownership Interest in this Class R Certificate if it has actual knowledge
that the proposed transferee is not a Permitted Transferee and (v) any
attempted or purported transfer of any Ownership Interest in this Class R
Certificate in violation of such restrictions will be absolutely null and void
and will vest no rights in the purported transferee.
Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement
or be valid for any purpose unless manually countersigned by an authorized
signatory of the Trustee.
D-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: August 23, 2001.
U.S. BANK NATIONAL ASSOCIATION
as Trustee
By:_________________________________________
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Date: August 23, 2001
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:_____________________________________
Authorized Signatory
D-5
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
CSFB ABS Trust Series 2001-HE17
CSFB Mortgage Pass-Through Certificates, Series 2001-HE17
Class R
This Certificate is one of a duly authorized issue of Certificates
designated as CSFB ABS Trust Series 2001-HE17, CSFB Mortgage Pass-Through
Certificates, Series 2001-HE17, of the Series specified on the face hereof
(herein collectively called the "Certificates"), and representing a beneficial
ownership interest in the Trust Fund created by the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Certificate Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee.
Pursuant to the terms of the Agreement, a distribution will be made on
the 25th day of each month, or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified on the face hereof, to the Person in
whose name this Certificate is registered at the close of business on the
applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be
distributed to Holders of Certificates of the Class to which this Certificate
belongs on such Distribution Date pursuant to the Agreement. The Record Date
applicable to each Distribution Date is (1) with respect to all Definitive
Certificates, the last day of the calendar month preceding the month in which
such Distribution Date occurs and (2) with respect to all Certificates held in
Book-Entry Form only, the Business Day immediately preceding the Distribution
Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the Corporate Trust Office or
such other location specified in the notice to Certificateholders of such
final distribution.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any
time by the Depositor, the Servicer, the Seller and the Trustee with the
consent of the Holders of Certificates affected by such amendment evidencing
the requisite Percentage Interest, as provided in the Agreement. Any such
consent by
D-6
the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange therefor or in lieu hereof whether or
not notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the Corporate Trust Office or the office or agency maintained by
the Trustee in [St. Xxxx, Minnesota], accompanied by a written instrument of
transfer in form satisfactory to the Trustee and the Certificate Registrar
duly executed by the holder hereof or such holder's attorney duly authorized
in writing, and thereupon one or more new Certificates of the same Class in
authorized denominations and evidencing the same aggregate Percentage Interest
in the Trust Fund will be issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations and evidencing the same aggregate Percentage Interest, as
requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Depositor, the Servicer, the Seller, the Trustee and any agent of the
Depositor or the Trustee may treat the Person in whose name this Certificate
is registered as the owner hereof for all purposes, and none of the Servicer,
the Seller, the Depositor, the Trustee or any such agent shall be affected by
any notice to the contrary.
On any Distribution Date on which the aggregate Stated Principal Balance
of the Mortgage Loans is less than 10% of the Aggregate Loan Balance as of the
Cut-off Date, and the amount on deposit in the Prefunding Account on the
Closing Date, the Servicer will have the option to repurchase, in whole, from
the Trust Fund all remaining Mortgage Loans and all property acquired in
respect of the Mortgage Loans at a purchase price determined as provided in
the Agreement. In the event that no such optional termination occurs, the
obligations and responsibilities created by the Agreement will terminate upon
the later of the maturity or other liquidation (or any advance with respect
thereto) of the last Mortgage Loan remaining in the Trust Fund or the
disposition of all property in respect thereof and the distribution to
Certificateholders of all amounts required to be distributed pursuant to the
Agreement. In no event, however, will the trust created by the Agreement
continue beyond the expiration of 21 years from the death of the last survivor
of the descendants living at the date of the Agreement of a certain person
named in the Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
D-7
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _____________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to
assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such
Certificate to the following address:
______________________________________________________________________________
Dated:
______________________________________________
Signature by or on behalf of assignor
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _______________________________________________
_____________________________________________________________________________,
for the account of __________________________________________________________,
account number _______________, or, if mailed by check, to ___________________
______________________________________________________________________________
_____________________________________________________________________________.
Applicable statements should be mailed to ____________________________________
______________________________________________________________________________
_____________________________________________________________________________.
This information is provided by, the assignee named above, or, as its agent.
D-8
EXHIBIT E
[FORM OF CLASS X CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE").
THIS CERTIFICATE HAS NO PRINCIPAL BALANCE AND IS NOT ENTITLED TO ANY
DISTRIBUTIONS IN RESPECT OF PRINCIPAL.
E-1
Certificate No. :
Cut-off Date : August 1, 2001
First Distribution Date : September 25, 2001
Percentage Interest :
CUSIP :
Maturity Date :
E-2
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
CSFB ABS Trust Series 2001-HE17
CSFB Mortgage Pass-Through Certificates, Series 2001-HE17
Class X
evidencing a percentage interest in the distributions allocable to
the Certificates of the above-referenced Class with respect to a
Trust Fund consisting primarily of a pool of fixed rate and
adjustable rate conventional mortgage loans (the "Mortgage Loans")
secured by first liens on one- to four-family residential properties.
Credit Suisse First Boston Mortgage Securities Corp., as Depositor
This Certificate does not evidence an obligation of, or an interest in,
and is not guaranteed by the Depositor, the Seller, the Servicer or the
Trustee referred to below or any of their respective affiliates. Neither this
Certificate nor the Mortgage Loans are guaranteed or insured by any
governmental agency or instrumentality.
This certifies that CREDIT SUISSE FIRST BOSTON CORPORATION is the
registered owner of the Percentage Interest evidenced by this Certificate in
certain monthly distributions with respect to a Trust Fund consisting
primarily of the Mortgage Loans deposited by Credit Suisse First Boston
Mortgage Securities Corp. (the "Depositor"). The Trust Fund was created
pursuant to a Pooling and Servicing Agreement dated as of the Cut-off Date
specified above (the "Agreement") among the Depositor, DLJ Mortgage Capital,
Inc., as seller (in such capacity, "Seller"), Vesta Servicing L.P., as
servicer (the "Servicer") and U.S. Bank National Association as trustee (the
"Trustee"). To the extent not defined herein, the capitalized terms used
herein have the meanings assigned in the Agreement. This Certificate is issued
under and is subject to the terms, provisions and conditions of the Agreement,
to which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement
or be valid for any purpose unless manually countersigned by an authorized
signatory of the Trustee.
E-3
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: August 23, 2001.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: __________________________________________
Name:
Title
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Date: August 23, 2001
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: ________________________________
Authorized Signatory
E-4
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
CSFB ABS Trust Series 2001-HE17
CSFB Mortgage Pass-Through Certificates, Series 2001-HE17
Class X
This Certificate is one of a duly authorized issue of Certificates
designated as CSFB ABS Trust Series 2001-HE17, CSFB Mortgage Pass-Through
Certificates, Series 2001-HE17, of the Series specified on the face hereof
(herein collectively called the "Certificates"), and representing a beneficial
ownership interest in the Trust Fund created by the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Certificate Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee.
Pursuant to the terms of the Agreement, a distribution will be made on
the 25th day of each month, or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified on the face hereof, to the Person in
whose name this Certificate is registered at the close of business on the
applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be
distributed to Holders of Certificates of the Class to which this Certificate
belongs on such Distribution Date pursuant to the Agreement. The Record Date
applicable to each Distribution Date is (1) with respect to all Definitive
Certificates, the last day of the calendar month preceding the month in which
such Distribution Date occurs and (2) with respect to all Certificates in
Book-Entry Form only, the Business Day immediately preceding the Distribution
Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the Corporate Trust Office or
such other location specified in the notice to Certificateholders of such
final distribution.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any
time by the Depositor, the Servicer, the Seller and the Trustee with the
consent of the Holders of Certificates affected by such amendment evidencing
the requisite Percentage Interest, as provided in the Agreement. Any such
consent by
E-5
the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange therefor or in lieu hereof whether or
not notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the Corporate Trust Office or the office or agency maintained by
the Trustee in [St. Xxxx, Minnesota], accompanied by a written instrument of
transfer in form satisfactory to the Trustee and the Certificate Registrar
duly executed by the holder hereof or such holder's attorney duly authorized
in writing, and thereupon one or more new Certificates of the same Class in
authorized denominations and evidencing the same aggregate Percentage Interest
in the Trust Fund will be issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations and evidencing the same aggregate Percentage Interest, as
requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Depositor, the Servicer, the Seller, the Trustee and any agent of the
Depositor or the Trustee may treat the Person in whose name this Certificate
is registered as the owner hereof for all purposes, and none of the Servicer,
the Seller, the Depositor, the Trustee or any such agent shall be affected by
any notice to the contrary.
On any Distribution Date on which the aggregate Stated Principal Balance
of the Mortgage Loans is less than 10% of the Aggregate Loan Balance as of the
Cut-off Date, and the amount on deposit in the Prefunding Account on the
Closing Date, the Servicer will have the option to repurchase, in whole, from
the Trust Fund all remaining Mortgage Loans and all property acquired in
respect of the Mortgage Loans at a purchase price determined as provided in
the Agreement. In the event that no such optional termination occurs, the
obligations and responsibilities created by the Agreement will terminate upon
the later of the maturity or other liquidation (or any advance with respect
thereto) of the last Mortgage Loan remaining in the Trust Fund or the
disposition of all property in respect thereof and the distribution to
Certificateholders of all amounts required to be distributed pursuant to the
Agreement. In no event, however, will the trust created by the Agreement
continue beyond the expiration of 21 years from the death of the last survivor
of the descendants living at the date of the Agreement of a certain person
named in the Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
E-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _____________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to
assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such
Certificate to the following address:
______________________________________________________________________________
Dated:
______________________________________________
Signature by or on behalf of assignor
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _______________________________________________
_____________________________________________________________________________,
for the account of __________________________________________________________,
account number _______________, or, if mailed by check, to ___________________
______________________________________________________________________________
_____________________________________________________________________________.
Applicable statements should be mailed to ____________________________________
______________________________________________________________________________
_____________________________________________________________________________.
This information is provided by, the assignee named above, or, as its agent.
E-7
EXHIBIT F
[FORM OF CLASS A-IO CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE").
F-1
Certificate No. :
Cut-off Date : August 1, 2001
First Distribution Date : September 25, 2001
Initial Notional Amount of this
Certificate ("Denomination") :
Initial Class Notional Amount of
all Certificates of this Class :
Percentage Interest :
CUSIP :
Pass-Through Rate :
Maturity Date :
F-2
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
CSFB ABS Trust Series 2001-HE17
CSFB Mortgage Pass-Through Certificates, Series 2001-HE17
Class A-IO
evidencing a percentage interest in the distributions allocable to
the Certificates of the above-referenced Class with respect to a
Trust Fund consisting primarily of a pool of fixed rate and
adjustable rate conventional mortgage loans (the "Mortgage Loans")
secured by first liens on one- to four-family residential properties.
Credit Suisse First Boston Mortgage Securities Corp., as Depositor
This Certificate does not evidence an obligation of, or an interest in,
and is not guaranteed by the Depositor, the Seller, the Servicer or the
Trustee referred to below or any of their respective affiliates. Neither this
Certificate nor the Mortgage Loans are guaranteed or insured by any
governmental agency or instrumentality.
This certifies that CEDE & CO. is the registered owner of the Percentage
Interest evidenced by this Certificate (obtained by dividing the denomination
of this Certificate by the aggregate of the denominations of all Certificates
of the Class to which this Certificate belongs) in certain monthly
distributions with respect to a Trust Fund consisting primarily of the
Mortgage Loans deposited by Credit Suisse First Boston Mortgage Securities
Corp. (the "Depositor"). The Trust Fund was created pursuant to a Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
"Agreement") among the Depositor, DLJ Mortgage Capital, Inc., as seller (in
such capacity, "Seller"), Vesta Servicing L.P., as servicer (the "Servicer")
and U.S. Bank National Association as trustee (the "Trustee"). To the extent
not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement
or be valid for any purpose unless manually countersigned by an authorized
signatory of the Trustee.
F-3
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: August 23, 2001.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:_________________________________________
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Date: August 23, 2001
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: _________________________________
Authorized Signatory
F-4
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
CSFB ABS Trust Series 2001-HE17
CSFB Mortgage Pass-Through Certificates, Series 2001-HE17
Class A-IO
This Certificate is one of a duly authorized issue of Certificates
designated as CSFB ABS Trust Series 2001-HE17, CFSB Mortgage Pass-Through
Certificates, Series 2001-HE17, of the Series specified on the face hereof
(herein collectively called the "Certificates"), and representing a beneficial
ownership interest in the Trust Fund created by the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Certificate Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee.
Pursuant to the terms of the Agreement, a distribution will be made on
the 25th day of each month, or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified on the face hereof, to the Person in
whose name this Certificate is registered at the close of business on the
applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be
distributed to Holders of Certificates of the Class to which this Certificate
belongs on such Distribution Date pursuant to the Agreement. The Record Date
applicable to each Distribution Date is (1) with respect to all Definitive
Certificates, the last day of the calendar month preceding the month in which
such Distribution Date occurs and (2) with respect to all Certificates held in
Book-Entry Form only, the Business Day immediately preceding the Distribution
Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the Corporate Trust Office or
such other location specified in the notice to Certificateholders of such
final distribution.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any
time by the Depositor, the Servicer, the Seller and the Trustee with the
consent of the Holders of Certificates affected by such amendment evidencing
the requisite Percentage Interest, as provided in the Agreement. Any such
consent by
F-5
the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange therefor or in lieu hereof whether or
not notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the Corporate Trust Office or the office or agency maintained by
the Trustee in [St. Xxxx, Minnesota], accompanied by a written instrument of
transfer in form satisfactory to the Trustee and the Certificate Registrar
duly executed by the holder hereof or such holder's attorney duly authorized
in writing, and thereupon one or more new Certificates of the same Class in
authorized denominations and evidencing the same aggregate Percentage Interest
in the Trust Fund will be issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations and evidencing the same aggregate Percentage Interest, as
requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Depositor, the Servicer, the Seller, the Trustee and any agent of the
Depositor or the Trustee may treat the Person in whose name this Certificate
is registered as the owner hereof for all purposes, and none of the Servicer,
the Seller, the Depositor, the Trustee, or any such agent shall be affected by
any notice to the contrary.
On any Distribution Date on which the aggregate Stated Principal Balance
of the Mortgage Loans is less than 10% of the Aggregate Loan Balance as of the
Cut-off Date, and the amount on deposit in the Prefunding Account on the
Closing Date, the Servicer will have the option to repurchase, in whole, from
the Trust Fund all remaining Mortgage Loans and all property acquired in
respect of the Mortgage Loans at a purchase price determined as provided in
the Agreement. In the event that no such optional termination occurs, the
obligations and responsibilities created by the Agreement will terminate upon
the later of the maturity or other liquidation (or any advance with respect
thereto) of the last Mortgage Loan remaining in the Trust Fund or the
disposition of all property in respect thereof and the distribution to
Certificateholders of all amounts required to be distributed pursuant to the
Agreement. In no event, however, will the trust created by the Agreement
continue beyond the expiration of 21 years from the death of the last survivor
of the descendants living at the date of the Agreement of a certain person
named in the Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
F-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _____________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to
assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such
Certificate to the following address:
______________________________________________________________________________
Dated:
______________________________________________
Signature by or on behalf of assignor
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _______________________________________________
_____________________________________________________________________________,
for the account of __________________________________________________________,
account number _______________, or, if mailed by check, to ___________________
______________________________________________________________________________
_____________________________________________________________________________.
Applicable statements should be mailed to ____________________________________
______________________________________________________________________________
_____________________________________________________________________________.
This information is provided by, the assignee named above, or, as its agent.
F-7
EXHIBIT G
FORM OF INITIAL CERTIFICATION OF TRUSTEE
[date]
[Depositor]
[Servicer/s]
[Seller]
_________________________
_________________________
Re: Pooling and Servicing Agreement among the Depositor, DLJ
Mortgage Capital, Inc., as seller (in such capacity, "Seller"),
Vesta Servicing L.P., as servicer ("the "Servicer") and U.S.
Bank National Association as trustee (the "Trustee") CSFB
Mortgage Pass-Through Certificates, Series 2001-HE17
---------------------------------------------------------------
Gentlemen:
In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), the undersigned,
as Trustee, hereby certifies that, as to each Mortgage Loan listed in each
Mortgage Loan Schedule (other than any Mortgage Loan listed in the attached
schedule), it has received:
(i) the original Mortgage Note, endorsed as provided in the following
form: "Pay to the order of ________, without recourse"; and
(ii) a duly executed Assignment of the Mortgage (which may be included in
a blanket assignment or assignments).
Based on its review and examination and only as to the foregoing
documents, such documents appear regular on their face and relate to such
Mortgage Loan.
The Trustee has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically required in the
Pooling and Servicing Agreement. The Trustee makes no representations as to:
(i) the validity, legality, sufficiency, enforceability or genuineness of any
of the documents contained in each Mortgage File of any of the Mortgage Loans
identified on either Mortgage Loan Schedule, or (ii) the collectability,
insurability, effectiveness or suitability of any such Mortgage Loan.
G-1
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: __________________________________
Name: ________________________________
Title: _______________________________
G-2
EXHIBIT H
FORM OF FINAL CERTIFICATION OF TRUSTEE
[date]
[Depositor]
[Servicer/s]
[Seller]
_____________________
_____________________
Re: Pooling and Servicing Agreement among the Depositor, DLJ
Mortgage Capital, Inc., as seller (in such capacity, "Seller"),
Vesta Servicing L.P., as servicer (the "Servicer") and U.S.
Bank National Association as trustee (the "Trustee") CSFB
Mortgage Pass-Through Certificates, Series 2001-HE17
---------------------------------------------------------------
Gentlemen:
In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), the undersigned,
as Trustee, hereby certifies that as to each Mortgage Loan listed in each
Mortgage Loan Schedule (other than any Mortgage Loan paid in full or listed on
the attached Document Exception Report) it has received:
(i) the original Mortgage Note, endorsed in the form provided in Section
2.01(b) of the Pooling and Servicing Agreement, with all intervening
endorsements, and including any riders to the Mortgage Note, showing a
complete chain of endorsement from the originator to the last named endorsee;
(ii) with respect to any Lost Mortgage Note, a lost note affidavit
stating that the original Mortgage Note was lost or destroyed, together with a
copy of such Mortgage Note;
(iii) the original of any guarantee executed in connection with the
Mortgage Note (if any);
(iv) the original Mortgage with evidence of recording thereon, or copies
certified by the related recording office or if the original Mortgage has not
yet been returned from the recording office, a copy certified by or on behalf
of the Seller indicating that such Mortgage has been delivered for recording;
(v) the originals of all assumption, modification, consolidation or
extension agreements (or, if an original of any of these documents has not
been returned from the recording office, a copy thereof certified by or on
behalf of the Seller, the original to be delivered to the Seller forthwith
after return from such recording office), with evidence of recording thereon,
if any;
H-1
(vi) a duly executed assignment of the Mortgage in the form provided in
Section 2.01(b) of the Pooling and Servicing Agreement; provided, however,
that if the Depositor has certified or the Trustee otherwise knows that the
related Mortgage has not been returned from the applicable recording office, a
copy of the Assignment of the Mortgage (excluding information to be provided
by the recording office);
(vii) the original of any intervening recorded Assignments of Mortgage,
showing a complete chain of assignment from origination to the related Seller,
including warehousing assignments, with evidence of recording thereon (or, if
an original intervening Assignment of Mortgage has not been returned from the
recording office, a copy thereof certified by or on behalf of the Seller);
(viii) the original or duplicate original lender's title insurance policy
and all riders thereto or, any one of an original title binder, an original
preliminary title report or an original title commitment, or a copy thereof
certified by the title company (or, in appropriate jurisdictions, attorney's
opinion of title and abstract of title); and
(ix) the original primary mortgage insurance certificate, if any or copy
of mortgage insurance certificate.
Based on its review and examination and only as to the foregoing
documents, (a) such documents appear regular on their face and related to such
Mortgage Loan, and (b) the information set forth in items (i), (ii), (iii),
(iv), (vi), (ix) and (x) of the definition of the "Mortgage Loan Schedule" in
Article I of the Pooling and Servicing Agreement accurately reflects
information set forth in the Mortgage File.
The Trustee has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically required in the
Pooling and Servicing Agreement. The Trustee makes no representations as to:
(i) the validity, legality, sufficiency, enforceability or genuineness of any
of the documents contained in each Mortgage File of any of the Mortgage Loans
identified on either Mortgage Loan Schedule, or (ii) the collectability,
insurability, effectiveness or suitability of any such Mortgage Loan.
Notwithstanding anything herein to the contrary, the Trustee has made no
determination and makes no representations as to whether (i) any endorsement
is sufficient to transfer all right, title and interest of the party so
endorsing, as noteholder or assignee thereof, in and to that Mortgage Note or
(ii) any assignment is in recordable form or sufficient to effect the
assignment of and transfer to the assignee thereof, under the Mortgage to
which the assignment relates.
H-2
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: __________________________________
Name: ________________________________
Title: _______________________________
H-3
EXHIBIT I
TRANSFER AFFIDAVIT
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
CSFB Mortgage Pass-Through Certificates, Series 2001-HE17
Class [_______]
STATE OF )
) ss.:
COUNTY OF )
The undersigned, being first duly sworn, deposes and says as follows:
1. The undersigned is an officer of ______________, the proposed
Transferee of an Ownership Interest in a Class R Certificate (the
"Certificate") issued pursuant to Pooling and Servicing Agreement dated as of
the Cut-off Date specified above (the "Agreement") among the Depositor, DLJ
Mortgage Capital, Inc., as seller (in such capacity, "Seller"), Vesta
Servicing L.P., as servicer (the "Servicer") and U.S. Bank National
Association as trustee (the "Trustee"). Capitalized terms used, but not
defined herein or in Exhibit 1 hereto, shall have the meanings ascribed to
such terms in the Agreement. The Transferee has authorized the undersigned to
make this affidavit on behalf of the Transferee.
2. The Transferee is, as of the date hereof, and will be, as of the date
of the Transfer, a Permitted Transferee. The Transferee is acquiring its
Ownership Interest in the Certificate either (i) for its own account or (ii)
as nominee, trustee or agent for another Person and has attached hereto an
affidavit from such Person in substantially the same form as this affidavit.
The Transferee has no knowledge that any such affidavit is false.
3. The Transferee has been advised of, and understands that (i) a tax
will be imposed on Transfers of the Certificate to Persons that are not
Permitted Transferees; (ii) such tax will be imposed on the transferor, or, if
such Transfer is through an agent (which includes a broker, nominee or
middleman) for a Person that is not a Permitted Transferee, on the agent; and
(iii) the Person otherwise liable for the tax shall be relieved of liability
for the tax if the subsequent Transferee furnished to such Person an affidavit
that such subsequent Transferee is a Permitted Transferee and, at the time of
Transfer, such Person does not have actual knowledge that the affidavit is
false.
4. The Transferee has been advised of, and understands that a tax will be
imposed on a "pass-through entity" holding the Certificate if at any time
during the taxable year of the pass-through entity a Person that is not a
Permitted Transferee is the record holder of an interest in such entity. The
Transferee understands that such tax will not be imposed for any period with
respect to which the record holder furnishes to the pass-through entity an
affidavit that such record holder is a Permitted Transferee and the
pass-through entity does not have actual knowledge that such affidavit is
false. (For this purpose, a "pass-through entity" includes a regulated
investment company, a real estate investment trust or common trust fund, a
partnership, trust or estate, and certain cooperatives and, except as may be
provided in Treasury Regulations, persons holding interests in pass-through
entities as a nominee for another Person.)
I-1
5. The Transferee has reviewed the provisions of Section 5.02(c) of the
Agreement (attached hereto as Exhibit 2 and incorporated herein by reference)
and understands the legal consequences of the acquisition of an Ownership
Interest in the Certificate including, without limitation, the restrictions on
subsequent Transfers and the provisions regarding voiding the Transfer and
mandatory sales. The Transferee expressly agrees to be bound by and to abide
by the provisions of Section 5.02(c) of the Agreement and the restrictions
noted on the face of the Certificate. The Transferee understands and agrees
that any breach of any of the representations included herein shall render the
Transfer to the Transferee contemplated hereby null and void.
6. The Transferee agrees to require a Transfer Affidavit from any Person
to whom the Transferee attempts to Transfer its Ownership Interest in the
Certificate, and in connection with any Transfer by a Person for whom the
Transferee is acting as nominee, trustee or agent, and the Transferee will not
Transfer its Ownership Interest or cause any Ownership Interest to be
Transferred to any Person that the Transferee knows is not a Permitted
Transferee. In connection with any such Transfer by the Transferee, the
Transferee agrees to deliver to the Trustee a certificate substantially in the
form set forth as EXHIBIT J to the Agreement (a "Transferor Certificate") to
the effect that such Transferee has no actual knowledge that the Person to
which the Transfer is to be made is not a Permitted Transferee.
7. The Transferee does not have the intention to impede the assessment or
collection of any tax legally required to be paid with respect to the
Certificate.
8. The Transferee's taxpayer identification number is [_____________].
9. The Transferee is a United States Person.
10. The Transferee is aware that the Certificate may be a "noneconomic
residual interest" within the meaning of proposed Treasury regulations
promulgated pursuant to the Code and that the transferor of a noneconomic
residual interest will remain liable for any taxes due with respect to the
income on such residual interest, unless no significant purpose of the
transfer was to impede the assessment or collection of tax.
11. The Transferee is not an employee benefit plan that is subject to
ERISA or a plan that is subject to Section 4975 of the Code, and the
Transferee is not acting on behalf of such a plan.
I-2
IN WITNESS WHEREOF, the Transferee has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by
its duly authorized officer and its corporate seal to be hereunto affixed,
duly attested, this __ day of _______, 20__ .
____________________________________________
Print Name of Transferee
By: ________________________________________
Name:
Title:
[Corporate Seal]
ATTEST:
____________________________________________
[Assistant] Secretary
Personally appeared before me the above-named , known or proved to me to
be the same person who executed the foregoing instrument and to be the of the
Transferee, and acknowledged that he executed the same as his free act and
deed and the free act and deed of the Transferee.
Subscribed and sworn before me this day __of _________, 20__.
_______________________________________
NOTARY PUBLIC
My Commission expires the __ day of
_________, 20 .
I-3
EXHIBIT 1
to
EXHIBIT I
Certain Definitions
"Ownership Interest": As to any Residual Certificate, any ownership
interest in such Certificate, including any interest in such Certificate as
the Holder thereof and any other interest therein, whether direct or indirect,
legal or beneficial.
"Permitted Transferee": Any person other than (i) the United States, any
State or political subdivision thereof, or any agency or instrumentality of
any of the foregoing, (ii) a foreign government, International Organization or
any agency or instrumentality of either of the foregoing, (iii) an
organization (except certain farmers' cooperatives described in section 521 of
the Code) which is exempt from tax imposed by Chapter 1 of the Code (including
the tax imposed by section 511 of the Code on unrelated business taxable
income) on any excess inclusions (as defined in section 860E(c)(1) of the
Code) with respect to any Residual Certificate, (iv) rural electric and
telephone cooperatives described in section 1381(a)(2)(C) of the Code, (v) a
Person that is not a 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, any State thereof or the District of Columbia, or an estate
whose income from sources without the United States is includible in gross
income for 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 the
authority to control all substantial decisions of the trust unless such Person
has furnished the transferor and the Trustee with a duly completed Internal
Revenue Service Form 4224, and (vi) any other Person so designated by the
Depositor based upon an Opinion of Counsel that the Transfer of an Ownership
Interest in a Residual Certificate to such Person may cause the Trust Fund
hereunder to fail to qualify as a REMIC at any time that the Certificates are
outstanding. The terms "United States," "State" and "International
Organization" shall have the meanings set forth in section 7701 of the Code or
successor provisions. A corporation will not be treated as an instrumentality
of the United States or of any State or political subdivision thereof for
these purposes if all of its activities are subject to tax and, with the
exception of the Federal Home Loan Mortgage Corporation, a majority of its
board of directors is not selected by such government unit.
"Person": Any individual, corporation, partnership, joint venture,
association, limited liability company, joint-stock company, trust,
unincorporated organization or government, or any agency or political
subdivision thereof.
"Transfer": Any direct or indirect transfer or sale of any Ownership
Interest in a Residual Certificate.
"Transferee": Any Person who is acquiring by Transfer any Ownership
Interest in a Residual Certificate.
I-1-1
EXHIBIT 2
to
EXHIBIT I
Section 5.02(c) of the Agreement
[TO BE INSERTED WHEN POOLING AND SERVICING AGREEMENT FINALIZED].
I-2-1
EXHIBIT J
FORM OF TRANSFEROR CERTIFICATE
__________, 200__
Credit Suisse First Boston Mortgage Securities Corp.
00 Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxx
U.S. Bank National Association
000 Xxxx Xxxxx Xxxxxx
Xx. Xxxx, Xxxxxxxxx 00000
Re: Credit Suisse First Boston Mortgage Securities Corp.,
CSFB Mortgage Pass-Through Certificates, Series 2001-HE17,
Class [___]
----------------------------------------------------------
Ladies and Gentlemen:
In connection with our disposition of the above Certificates we certify
that (a) we understand that the Certificates have not been registered under
the Securities Act of 1933, as amended (the "Act"), and are being disposed by
us in a transaction that is exempt from the registration requirements of the
Act, (b) we have not offered or sold any Certificates to, or solicited offers
to buy any Certificates from, any person, or otherwise approached or
negotiated with any person with respect thereto, in a manner that would be
deemed, or taken any other action which would result in, a violation of
Section 5 of the Act and (c) to the extent we are disposing of a Class R
Certificate, we have no knowledge the Transferee is not a Permitted
Transferee.
Very truly yours,
___________________________
Print Name of Transferor
By: ___________________________
Authorized Officer
J-1
EXHIBIT K
FORM OF INVESTMENT LETTER (NON-RULE 144A)
__________, 200__
Credit Suisse First Boston Mortgage Securities Corp.
00 Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxx
U.S. Bank National Association
000 Xxxx Xxxxx Xxxxxx
Xx. Xxxx, Xxxxxxxxx 00000
Re: Credit Suisse First Boston Mortgage Securities Corp.,
CSFB Mortgage Pass-Through Certificates,
Series 2001-HE17, Class [___]
-----------------------------------------------------
Ladies and Gentlemen:
In connection with our acquisition of the above Certificates we certify
that (a) we understand that the Certificates are not being registered under
the Securities Act of 1933, as amended (the "Act"), or any state securities
laws and are being transferred to us in a transaction that is exempt from the
registration requirements of the Act and any such laws, (b) we are an
"accredited investor," as defined in Regulation D under the Act, and have such
knowledge and experience in financial and business matters that we are capable
of evaluating the merits and risks of investments in the Certificates, (c) we
have had the opportunity to ask questions of and receive answers from the
Depositor concerning the purchase of the Certificates and all matters relating
thereto or any additional information deemed necessary to our decision to
purchase the Certificates, (d) either (i) we are not an employee benefit plan
that is subject to the Employee Retirement Income Security Act of 1974, as
amended, or a plan or arrangement that is subject to Section 4975 of the
Internal Revenue Code of 1986, as amended, nor are we acting on behalf of any
such plan or arrangement nor are we using the assets of any such plan or
arrangement to effect such acquisition or (ii) if we are an insurance company,
a representation that we are an insurance company which is purchasing such
Certificates with funds contained in an "insurance company general account"
(as such term is defined in Section V(e) of Prohibited Transaction Class
Exemption 95-60 ("PTCE 95-60")) and that the purchase and holding of such
Certificates are covered under PTCE 95-60, (e) if an insurance company, we are
purchasing the Certificates with funds contained in an "insurance company
general account" (as defined in Section V(e) of Prohibited Transaction Class
Exemption 95-60 ("PTCE 95-60")) and our purchase and holding of the
Certificates are covered under XXXX 00-00, (x) we are acquiring the
Certificates for investment for our own account and not with a view to any
distribution of such Certificates (but without prejudice to our right at all
times to sell or otherwise dispose of the Certificates in accordance with
clause (h) below), (g) we have not offered or sold any Certificates to, or
solicited offers to buy any Certificates from, any person, or otherwise
approached or negotiated with any person with respect thereto, or taken any
other action which would result in a violation of Section 5 of the Act, and
(h) we will not sell, transfer or otherwise dispose of any Certificates
K-1
unless (1) such sale, transfer or other disposition is made pursuant to an
effective registration statement under the Act or is exempt from such
registration requirements, and if requested, we will at our expense provide an
opinion of counsel satisfactory to the addressees of this Certificate that
such sale, transfer or other disposition may be made pursuant to an exemption
from the Act, (2) the purchaser or transferee of such Certificate has executed
and delivered to you a certificate to substantially the same effect as this
certificate, and (3) the purchaser or transferee has otherwise complied with
any conditions for transfer set forth in the Pooling and Servicing Agreement.
Very truly yours,
___________________________
Print Name of Transferee
By: ___________________________
Authorized Officer
K-2
EXHIBIT L
FORM OF RULE 144A LETTER
____________, 200__
Credit Suisse First Boston Mortgage Securities Corp.
00 Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxx
U.S. Bank National Association
000 Xxxx Xxxxx Xxxxxx
Xx. Xxxx, Xxxxxxxxx 00000
Re: Credit Suisse First Boston Mortgage Securities Corp.,
CSFB Mortgage Pass-Through Certificates,
Series 2001-HE17, Class [___]
-----------------------------------------------------
Ladies and Gentlemen:
In connection with our acquisition of the above Certificates we certify
that (a) we understand that the Certificates are not being registered under
the Securities Act of 1933, as amended (the "Act"), or any state securities
laws and are being transferred to us in a transaction that is exempt from the
registration requirements of the Act and any such laws, (b) we have such
knowledge and experience in financial and business matters that we are capable
of evaluating the merits and risks of investments in the Certificates, (c) we
have had the opportunity to ask questions of and receive answers from the
Depositor concerning the purchase of the Certificates and all matters relating
thereto or any additional information deemed necessary to our decision to
purchase the Certificates, (d) we are not an employee benefit plan that is
subject to the Employee Retirement Income Security Act of 1974, as amended, or
a plan or arrangement that is subject to Section 4975 of the Internal Revenue
Code of 1986, as amended, nor are we acting on behalf of any such plan or
arrangement nor using the assets of any such plan or arrangement to effect
such acquisition, (e) if an insurance company, we are purchasing the
Certificates with funds contained in an "insurance company general account"
(as defined in Section V(e) of Prohibited Transaction Class Exemption 95-60
("PTCE 95-60")) and our purchase and holding of the Certificates are covered
under XXXX 00-00, (x) we have not, nor has anyone acting on our behalf
offered, transferred, pledged, sold or otherwise disposed of the Certificates,
any interest in the Certificates or any other similar security to, or
solicited any offer to buy or accept a transfer, pledge or other disposition
of the Certificates, any interest in the Certificates or any other similar
security from, or otherwise approached or negotiated with respect to the
Certificates, any interest in the Certificates or any other similar security
with, any person in any manner, or made any general solicitation by means of
general advertising or in any other manner, or taken any other action, that
would constitute a distribution of the Certificates under the Act or that
would render the disposition of the Certificates a violation of Section 5 of
the Act or require registration pursuant thereto, nor will act, nor has
authorized or will authorize any person to act, in such manner with respect to
the Certificates, (g) we are a "qualified institutional buyer" as that term is
defined in Rule 144A under the Act ("Rule 144A") and have completed either of
the forms of
L-1
certification to that effect attached hereto as Annex 1 or Annex 2, (h) we are
aware that the sale to us is being made in reliance on Rule 144A, and (i) we
are acquiring the Certificates for our own account or for resale pursuant to
Rule 144A and further, understand that such Certificates may be resold,
pledged or transferred only (A) to a person reasonably believed to be a
qualified institutional buyer that purchases for its own account or for the
account of a qualified institutional buyer to whom notice is given that the
resale, pledge or transfer is being made in reliance on Rule 144A, or (B)
pursuant to another exemption from registration under the Act.
Very truly yours,
___________________________
Print Name of Transferee
By: ___________________________
Authorized Officer
L-2
ANNEX 1 TO EXHIBIT L
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees Other Than Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the parties
listed in the Rule 144A Transferee Certificate to which this certification
relates with respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief Financial
Officer, Senior Vice President or other executive officer of the Buyer.
2. In connection with purchases by the Buyer, the Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933, as amended ("Rule 144A") because (i) the Buyer owned and/or
invested on a discretionary basis $__________1 in securities (except for the
excluded securities referred to below) as of the end of the Buyer's most
recent fiscal year (such amount being calculated in accordance with Rule 144A
and (ii) the Buyer satisfies the criteria in the category marked below.
___ Corporation, etc. The Buyer is a corporation (other than a bank,
savings and loan association or similar institution), Massachusetts or
similar business trust, partnership, or charitable organization described
in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended.
___ Bank. The Buyer (a) is a national bank or banking institution
organized under the laws of any State, territory or the District of
Columbia, the business of which is substantially confined to banking and
is supervised by the State or territorial banking commission or similar
official or is a foreign bank or equivalent institution, and (b) has an
audited net worth of at least $25,000,000 as demonstrated in its latest
annual financial statements, a copy of which is attached hereto.
___ Savings and Loan. The Buyer (a) is a savings and loan association,
building and loan association, cooperative bank, homestead association or
similar institution, which is supervised and examined by a State or
Federal authority having supervision over any such institutions or is a
foreign savings and loan association or equivalent institution and (b)
has an audited net worth of at least $25,000,000 as demonstrated in its
latest annual financial statements, a copy of which is attached hereto.
___ Broker-dealer. The Buyer is a dealer registered pursuant to Section
15 of the Securities Exchange Act of 1934.
_________________
1 Buyer must own and/or invest on a discretionary basis at lease
$100,000,000 in securities unless Buyer is a dealer, and, in that case,
Buyer must own and/or invest on a discretionary basis at least
$10,000,000 in securities.
L-1-1
___ Insurance Company. The Buyer is an insurance company whose primary
and predominant business activity is the writing of insurance or the
reinsuring of risks underwritten by insurance companies and which is
subject to supervision by the insurance commissioner or a similar
official or agency of a State, territory or the District of Columbia.
___ State or Local Plan. The Buyer is a plan established and maintained
by a State, its political subdivisions, or any agency or instrumentality
of the State or its political subdivisions, for the benefit of its
employees.
___ ERISA Plan. The Buyer is an employee benefit plan within the meaning
of Title I of the Employee Retirement Income Security Act of 1974.
___ Investment Advisor. The Buyer is an investment advisor registered
under the Investment Advisors Act of 1940.
___ Small Business Investment Company. Buyer is a small business
investment company licensed by the U.S. Small Business Administration
under Section 301(c) or (d) of the Small Business Investment Act of 1958.
___ Business Development Company. Buyer is a business development company
as defined in Section 202(a)(22) of the Investment Advisors Act of 1940.
3. The term "securities" as used herein does not include (i) securities
of issuers that are affiliated with the Buyer, (ii) securities that are part
of an unsold allotment to or subscription by the Buyer, if the Buyer is a
dealer, (iii) securities issued or guaranteed by the U.S. or any
instrumentality thereof, (iv) bank deposit notes and certificates of deposit,
(v) loan participations, (vi) repurchase agreements, (vii) securities owned
but subject to a repurchase agreement and (viii) currency, interest rate and
commodity swaps.
4. For purposes of determining the aggregate amount of securities owned
and/or invested on a discretionary basis by the Buyer, the Buyer used the cost
of such securities to the Buyer and did not include any of the securities
referred to in the preceding paragraph, except (i) where the Buyer reports its
securities holdings in its financial statements on the basis of their market
value, and (ii) no current information with respect to the cost of those
securities has been published. If clause (ii) in the preceding sentence
applies, the securities may be valued at market. Further, in determining such
aggregate amount, the Buyer may have included securities owned by subsidiaries
of the Buyer, but only if such subsidiaries are consolidated with the Buyer in
its financial statements prepared in accordance with generally accepted
accounting principles and if the investments of such subsidiaries are managed
under the Buyer's direction. However, such securities were not included if the
Buyer is a majority-owned, consolidated subsidiary of another enterprise and
the Buyer is not itself a reporting company under the Securities Exchange Act
of 1934, as amended.
5. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the
Certificates are relying and will continue to rely on the statements made
herein because one or more sales to the Buyer may be in reliance on Rule 144A.
L-1-2
6. Until the date of purchase of the Rule 144A Securities, the Buyer will
notify each of the parties to which this certification is made of any changes
in the information and conclusions herein. Until such notice is given, the
Buyer's purchase of the Certificates will constitute a reaffirmation of this
certification as of the date of such purchase. In addition, if the Buyer is a
bank or savings and loan is provided above, the Buyer agrees that it will
furnish to such parties updated annual financial statements promptly after
they become available.
_____________________
Print Name of Buyer
By: _____________________
Name:
Title:
Date: ___________________
X-0-0
XXXXX 0 XX XXXXXXX L
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees That are Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the parties
listed in the Rule 144A Transferee Certificate to which this certification
relates with respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief Financial
Officer or Senior Vice President of the Buyer or, if the Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933, as amended ("Rule 144A") because Buyer is part of a Family of
Investment Companies (as defined below), is such an officer of the Adviser.
2. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, as
amended and (ii) as marked below, the Buyer alone, or the Buyer's Family of
Investment Companies, owned at least $100,000,000 in securities (other than
the excluded securities referred to below) as of the end of the Buyer's most
recent fiscal year. For purposes of determining the amount of securities owned
by the Buyer or the Buyer's Family of Investment Companies, the cost of such
securities was used, except (i) where the Buyer or the Buyer's Family of
Investment Companies reports its securities holdings in its financial
statements on the basis of their market value, and (ii) no current information
with respect to the cost of those securities has been published. If clause
(ii) in the preceding sentence applies, the securities may be valued at
market.
___ The Buyer owned $_______ in securities (other than the excluded
securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule 144A).
___ The Buyer is part of a Family of Investment Companies which owned in
the aggregate $_______ in securities (other than the excluded securities
referred to below) as of the end of the Buyer's most recent fiscal year
(such amount being calculated in accordance with Rule 144A).
3. The term "Family of Investment Companies" as used herein means two or
more registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
4. The term "securities" as used herein does not include (i) securities
of issuers that are affiliated with the Buyer or are part of the Buyer's
Family of Investment Companies, (ii) securities issued or guaranteed by the
U.S. or any instrumentality thereof, (iii) bank deposit notes and certificates
of deposit, (iv) loan participations, (v) repurchase agreements, (vi)
securities owned but subject to a repurchase agreement and (vii) currency,
interest rate and commodity swaps.
L-2-1
5. The Buyer is familiar with Rule 144A and understands that the parties
listed in the Rule 144A Transferee Certificate to which this certification
relates are relying and will continue to rely on the statements made herein
because one or more sales to the Buyer will be in reliance on Rule 144A. In
addition, the Buyer will only purchase for the Buyer's own account.
6. Until the date of purchase of the Certificates, the undersigned will
notify the parties listed in the Rule 144A Transferee Certificate to which
this certification relates of any changes in the information and conclusions
herein. Until such notice is given, the Buyer's purchase of the Certificates
will constitute a reaffirmation of this certification by the undersigned as of
the date of such purchase.
__________________________________
Print Name of Buyer or Adviser
By: _____________________
Name:
Title:
IF AN ADVISER:
___________________________
Print Name of Buyer
Date: ___________________
L-2-2
EXHIBIT M
REQUEST FOR RELEASE
(for Trustee)
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
CSFB Mortgage Pass-Through Certificates, Series 2001-HE17
Class [_______]
Loan Information
----------------
Name of Mortgagor: ______________________________________
Servicer Loan No.: ______________________________________
Trustee
-------
Name: ______________________________________
Address: ______________________________________
______________________________________
______________________________________
Trustee Mortgage File No.:
The undersigned Servicer hereby acknowledges that it has received from
[Bank One, National Association] [U.S. Bank National Association] as Custodian
for the Holders of Mortgage Pass-Through Certificates, of the above-referenced
Series, the documents referred to below (the "Documents"). All capitalized
terms not otherwise defined in this Request for Release shall have the
meanings given them in the Pooling and Servicing Agreement dated as of the
Cut-off Date specified above (the "Agreement") among the Depositor, DLJ
Mortgage Capital, Inc., as seller (in such capacity, "Seller"), Vesta
Servicing L.P., as servicer (the "Servicer") and U.S. Bank National
Association as trustee (the "Trustee").
( ) Mortgage Note dated ________, ____, in the original principal sum of
$_______, made by _________, payable to, or endorsed to the order of, the
Trustee.
( ) Mortgage recorded on __________ as instrument no. _________ in the
County Recorder's Office of the County of _________, State of _________
in book/reel/docket of official records at page/image ___________.
( ) Deed of Trust recorded on __________ as instrument no. __________ in
the County Recorder's Office of the County of __________, State of
_________ in book/reel/docket ______ of official records at page/image
______.
( ) Assignment of Mortgage or Deed of Trust to the Trustee, recorded on
______as instrument no. ______ in the County Recorder's Office of the
County of ______, State of ________ in book/reel/docket ____ of official
records at page/image ____.
M-1
( ) Other documents, including any amendments, assignments or other
assumptions of the Mortgage Note or Mortgage.
( )
( )
( )
( )
The undersigned Servicer hereby acknowledges and agrees as follows:
(1) Such Servicer shall hold and retain possession of the Documents
in trust for the benefit of the Trustee, solely for the purposes
provided in the Agreement.
(2) Such Servicer shall not cause or knowingly permit the Documents
to become subject to, or encumbered by, any claim, liens, security
interest, charges, writs of attachment or other impositions nor
shall the Servicer, if applicable, assert or seek to assert any
claims or rights of setoff to or against the Documents or any
proceeds thereof.
(3) Such Servicer shall return each and every Document previously
requested from the Mortgage File to the Custodian when the need
therefor no longer exists, unless the Mortgage Loan relating to the
Documents has been liquidated and the proceeds thereof have been
remitted to the Certificate Account and except as expressly provided
in the Agreement.
(4) The Documents and any proceeds thereof, including any proceeds
of proceeds, coming into the possession or control of such Servicer
shall at all times be earmarked for the account of the Custodian,
and such Servicer shall keep the Documents and any proceeds separate
and distinct from all other property in such Servicer's possession,
custody or control.
[Servicer]
By: _________________
Its _________________
Date: ___________, 20[ ]
M-2
EXHIBIT N
OFFICER'S CERTIFICATE WITH RESPECT TO PREPAYMENTS
[Date]
Via Facsimile
U.S. Bank National Association
000 Xxxx Xxxxx Xxxxxx
Xx. Xxxx, Xxxxxxxxx 00000
Attention: [__________________]
Re: Pre-Payments
Dear Sir or Madam:
__________________ hereby certifies that he/she is an officer of the Servicer,
holding the office set forth beneath his/her name and hereby further certifies
as follows:
With respect to the Mortgage Loans, as the term is defined in the Pooling and
Servicing Agreement, set forth in the attached schedule:
1. A Principal Prepayment in full was received during the related Due Period;
2. Any Prepayment Premium due under the terms of the Mortgage Note with
respect to such Principal Prepayment in full was received from the
mortgagor and deposited in the Collection Account; ____ Yes ____ No
3. As to each Mortgage Loan so noted on the attached schedule, all or part
of the Prepayment Premium required in connection with the Principal
Prepayment in full was waived based upon (Circle one): (i) the Servicer's
determination that such waiver would maximize recovery of Liquidation
Proceeds for such Mortgage Loan, taking into account the value of such
Prepayment Premium, or (ii)(A) the enforceability thereof be limited (1)
by bankruptcy insolvency, moratorium, receivership, or other similar law
relating to creditors' rights generally or (2) due to acceleration in
connection with a foreclosure or other involuntary payment, or (B) the
enforceability is otherwise limited or prohibited by applicable law;
4. We certify that all amounts due in connection with the waiver of a
Prepayment Premium inconsistent with number 3 above which are required to
be deposited by the Servicer pursuant to Section [3.19] of the Pooling
and Servicing Agreement, have been or will be so deposited.
By: [Servicer]
--------------------------------
(Name)______________________________
Its: (Title)________________________
N-1
EXHIBIT O
GEMICO Policy
(Available Upon Request)
O-1
EXHIBIT P
FORM OF SERVICER REPORT
The following information will be e-mailed to Trustee in accordance with
Section 4.04:
Servicer Loan Number
Trust Loan Number (if applicable)
Scheduled Net Interest
Scheduled Principal
Curtailment Applied
Curtailment Adjustment
Mortgage Rate
Servicing Fee
P&I Payment
Beginning Scheduled Balance
Ending Scheduled Balance
Ending Actual Principal Balance
Due Date
Prepayment in full Principal
Prepayment in full Net Interest
Prepayment in full Penalty
Delinquencies:
1-30
31-60
61-90
91 +
Foreclosures
REO Properties
Loss Amounts
P-1
EXHIBIT Q
Financial Security Assurance, Inc. Policy
(Available Upon Request)
Q-1
EXHIBIT R
FORM OF SUBSEQUENT TRANSFER AGREEMENT
THIS SUBSEQUENT TRANSFER AGREEMENT, dated as of [_____], 2001 (this
"Subsequent Transfer Agreement"), among CREDIT SUISSE FIRST BOSTON MORTGAGE
SECURITIES CORP., a Delaware corporation, as depositor (the "Depositor"), DLJ
MORTGAGE CAPITAL, INC., a Delaware corporation, in its capacity as seller
under the Pooling and Servicing Agreement referred to below ( the "Seller"),
and U.S. BANK NATIONAL ASSOCIATION, a national banking association, as trustee
(the "Trustee");
WHEREAS, the parties hereto are also among the parties to the Pooling and
Servicing Agreement dated as of August 1, 2001 specified above (the "Pooling
and Servicing Agreement") among the Depositor, DLJ Mortgage Capital, Inc., as
seller (in such capacity, "Seller"), Vesta Servicing L.P., as servicer (the
"Servicer") and U.S. Bank National Association as trustee (the "Trustee") in
relation to the CSFB ABS Trust Series 2001-HE17, Mortgage Pass-Through
Certificates, Series 2001-HE17;
WHEREAS, Sections 2.01(d) of the Pooling and Servicing Agreement provides
for the parties hereto to enter into this Subsequent Transfer Agreement in
accordance with the terms and conditions of the Pooling and Servicing
Agreement;
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration the receipt and adequacy of which are hereby
acknowledged the parties hereto agree as follows:
(i) The "Subsequent Transfer Date" and "Subsequent Cut-off Date" with
respect to this Subsequent Transfer Agreement shall be
[_______________], 2001.
(ii) The "Aggregate Subsequent Purchase Amount" with respect to this
Subsequent Transfer Agreement shall be $[_____________], provided,
however, that such amount shall not exceed the amount on deposit
in the Prefunding Account.
(iii) The Subsequent Mortgage Loans conveyed on the Subsequent Transfer
Date shall satisfy the pool characteristics for the Trust Fund
identified in Section 2.01(d) of the Pooling and Servicing
Agreement.
(iv) In case any provision of this Subsequent Transfer Agreement shall
be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions or obligations shall
not in any way be affected or impaired thereby.
(v) In the event of any conflict between the provisions of this
Subsequent Transfer Agreement and the Pooling and Servicing
Agreement, the provisions of the Pooling and Servicing Agreement
shall prevail. Capitalized terms used herein
R-1
and not otherwise defined have the meanings in the Pooling and
Servicing Agreement.
(vi) The Seller hereby sells, transfers, assigns, sets over and
otherwise conveys to the Depositor, without recourse, all right
title and interest in the Subsequent Mortgage Loans identified in
Schedule A, including all interest and principal due on or with
respect to such Subsequent Mortgage Loans on or after the
Subsequent Cut-off Date and all interest and principal payments on
such Subsequent Mortgage Loans received prior to the Subsequent
Cut-off Date in respect of installments of interest and principal
due thereafter, but not including principal and interest due on
such Subsequent Mortgage Loans prior to the Subsequent Cut-off
Date, any insurance policies in respect of such Subsequent
Mortgage Loans and all proceeds of any of the foregoing.
(vii) This Subsequent Transfer Agreement shall be governed by, and shall
be construed and enforced in accordance with the laws of the State
of New York.
(viii) The Subsequent Transfer Agreement may be executed in one or more
counterparts, each of which so executed and delivered shall be
deemed an original, but all such counterparts together shall
constitute but one and the same instrument.
R-2
IN WITNESS WHEREOF, the parties to this Subsequent Transfer Agreement
have caused their names to be signed hereto by their respective officers
thereunto duly authorized as of the day and year first above written.
CREDIT SUISSE FIRST BOSTON MORTGAGE
SECURITIES CORP.
as Depositor
By:__________________________________________
Name:
Title:
DLJ MORTGAGE CAPITAL, INC.,
as Seller
By:___________________________________________
Name:
Title:
U.S. BANK NATIONAL ASSOCIATION,
not in its individual capacity, but solely as
Trustee
By:___________________________________________
Name:
Title:
VESTA SERVICING, L.P.
as Servicer
By:___________________________________________
Name:
Title:
R-3
SCHEDULE I
Mortgage Loan Schedule
(Provided Upon Request)
S-4
SCHEDULE IIA
Representations and Warranties of Seller - DLJ Mortgage Capital, Inc.
(i) the Seller is a corporation duly organized, validly existing and in
good standing under the laws of the state of its incorporation;
(ii) the Seller has full corporate power to own its property, to carry on
its business as presently conducted and to enter into and perform its
obligations under this Agreement;
(iii) the execution and delivery by the Seller of this Agreement have
been duly authorized by all necessary corporate action on the part of the
Seller; and neither the execution and delivery of this Agreement, nor the
consummation of the transactions herein contemplated hereby, nor compliance
with the provisions hereof, will conflict with or result in a breach of, or
constitute a default under, any of the provisions of any law, governmental
rule, regulation, judgment, decree or order binding on the Seller or its
properties or the certificate of incorporation or by-laws of the Seller,
except those conflicts, breaches or defaults which would not reasonably be
expected to have a material adverse effect on the Seller's ability to enter
into this Agreement and to consummate the transactions contemplated hereby;
(iv) the execution, delivery and performance by the Seller of this
Agreement and the consummation of the transactions contemplated hereby do not
require the consent or approval of, the giving of notice to, the registration
with, or the taking of any other action in respect of, any state, federal or
other governmental authority or agency, except those consents, approvals,
notices, registrations or other actions as have already been obtained, given
or made and, in connection with the recordation of the Mortgages, powers of
attorney or assignments of Mortgages not yet completed;
(v) this Agreement has been duly executed and delivered by the Seller
and, assuming due authorization, execution and delivery by the Trustee, the
Servicer and the Depositor, constitutes a valid and binding obligation of the
Seller enforceable against it in accordance with its terms (subject to
applicable bankruptcy and insolvency laws and other similar laws affecting the
enforcement of the rights of creditors generally); and
(vi) to the knowledge of the Seller, there are no actions, litigation,
suits or proceedings pending or threatened against the Seller before or by any
court, administrative agency, arbitrator or governmental body (i) with respect
to any of the transactions contemplated by this Agreement or (ii) with respect
to any other matter which in the judgment of the Seller if determined
adversely to the Seller would reasonably be expected to materially and
adversely affect the Seller's ability to perform its obligations under this
Agreement; and the Seller is not in default with respect to any order of any
court, administrative agency, arbitrator or governmental body so as to
materially and adversely affect the transactions contemplated by this
Agreement.
S-5
SCHEDULE IIB
Representations and Warranties of Servicer and Special
Servicer- Vesta Servicing, L.P.
(i) Vesta Servicing, L.P. ("Vesta") is a corporation duly organized,
validly existing and in good standing under the laws of the state of its
incorporation;
(ii) Vesta has full corporate power to own its property, to carry on its
business as presently conducted and to enter into and perform its obligations
under this Agreement;
(iii) the execution and delivery by Vesta of this Agreement have been
duly authorized by all necessary corporate action on the part of Vesta; and
neither the execution and delivery of this Agreement, nor the consummation of
the transactions herein contemplated hereby, nor compliance with the
provisions hereof, will conflict with or result in a breach of, or constitute
a default under, any of the provisions of any law, governmental rule,
regulation, judgment, decree or order binding on Vesta or its properties or
the certificate of incorporation or bylaws of Vesta, except those conflicts,
breaches or defaults which would not reasonably be expected to have a material
adverse effect on Vesta's ability to enter into this Agreement and to
consummate the transactions contemplated hereby;
(iv) this Agreement has been duly executed and delivered by Vesta and,
assuming due authorization, execution and delivery by the Trustee, the Seller
and the Depositor, constitutes a valid and binding obligation of Vesta
enforceable against it in accordance with its terms (subject to applicable
bankruptcy and insolvency laws and other similar laws affecting the
enforcement of the rights of creditors generally); and
(v) to the knowledge of Vesta, there are no actions, litigation, suits or
proceedings pending or threatened against Vesta before or by any court,
administrative agency, arbitrator or governmental body (a) with respect to any
of the transactions contemplated by this Agreement or (b) with respect to any
other matter which in the judgment of Vesta if determined adversely to Vesta
would reasonably be expected to materially and adversely affect Vesta's
ability to perform its obligations under this Agreement, other than as Vesta
has previously advised Seller; and Vesta is not in default with respect to any
order of any court, administrative agency, arbitrator or governmental body so
as to materially and adversely affect the transactions contemplated by this
Agreement.
S-6
SCHEDULE IIIA
Representations and Warranties - Mortgage Loans
Under the pooling and servicing agreement, the Trustee will receive
representations and warranties made by DLJ Mortgage Capital or the underlying
seller. DLJ Mortgage Capital will make only limited representations and
warranties, and only as to certain of the loans.
As to each mortgage loan, either DLJ Mortgage Capital or the underlying
seller will represent and warrant in addition to other items, that:
(i) The Seller or its affiliate is the sole owner of record and holder of
the Mortgage Loan and the indebtedness evidenced by the Mortgage Note.
Immediately prior to the transfer and assignment to the Depositor on the
Closing Date, the Mortgage Loan, including the Mortgage Note and the Mortgage,
were not subject to an assignment or pledge, and the Seller had good and
marketable title to and was the sole owner thereof and had full right to
transfer and sell the Mortgage Loan to the Depositor free and clear of any
encumbrance, equity, lien, pledge, charge, claim or security interest and has
the full right and authority subject to no interest or participation of, or
agreement with, any other party, to sell and assign the Mortgage Loan and
following the sale of the Mortgage Loan, the Depositor will own such Mortgage
Loan free and clear of any encumbrance, equity, participation interest, lien,
pledge, charge, claim or security interest.
(ii) Any and all requirements of any federal, state or local law
including, without limitation, usury, truth-in-lending, real estate settlement
procedures, consumer credit protection, equal credit opportunity or disclosure
laws applicable to the Mortgage Loan have been complied with in all material
respects.
(iii) The terms of the Mortgage Note and the Mortgage have not been
impaired, waived, altered or modified in any respect, except by written
instruments which have been recorded to the extent any such recordation is
required by law, or, necessary to protect the interest of the Depositor. No
instrument of waiver, alteration or modification has been executed, and no
Mortgagor has been released, in whole or in part, from the terms thereof
except in connection with an assumption agreement and which assumption
agreement is part of the Mortgage File and the terms of which are reflected in
the Mortgage Loan Schedule; the substance of any such waiver, alteration or
modification has been approved by the issuer of any related Primary Insurance
Policy and title insurance policy, to the extent required by the related
policies.
(iv) The Mortgage Loan complies with all the terms, conditions and
requirements of the originator's underwriting standards in effect at the time
of origination of such Mortgage Loan.
(v) The information set forth in the Mortgage Loan Schedule, attached to
the Agreement as Schedule I, is complete, true and correct in all material
respects as of the Cut-off Date.
S-7
(vi) The related Mortgage is a valid, subsisting, enforceable and
perfected first lien on the Mortgaged Property and, all buildings on the
Mortgaged Property and all installations and mechanical, electrical, plumbing,
heating and air conditioning systems affixed to such buildings, and all
additions, alterations and replacements made at anytime with respect to the
foregoing securing the Mortgage Note's original principal balance. The
Mortgage and the Mortgage Note do not contain any evidence of any security
interest or other interest or right thereto. Such lien is free and clear of
all adverse claims, liens and encumbrances having priority over the first
lien, as applicable, of the Mortgage subject only to (1) the lien of
non-delinquent current real property taxes and assessments not yet due and
payable, (2) covenants, conditions and restrictions, rights of way, easements
and other matters of the public record as of the date of recording which are
acceptable to mortgage lending institutions generally and either (A) which are
referred to or otherwise considered in the appraisal made for the originator
of the Mortgage Loan, or (B) which do not adversely affect the appraised value
of the Mortgaged Property as set forth in such appraisal, and (3) other
matters to which like properties are commonly subject which do not materially
interfere with the benefits of the security intended to be provided by the
Mortgage or the use, enjoyment, value or marketability of the related
Mortgaged Property. Any security agreement, chattel mortgage or equivalent
document related to and delivered in connection with the Mortgage Loan
establishes and creates a valid, subsisting, enforceable and perfected first
lien and first priority security interest on the property described therein,
and the Seller has the full right to sell and assign the same to the
Depositor.
(vii) There are no mechanics' or similar liens or claims which have been
filed for work, labor or material (and no rights are outstanding that under
law could give rise to such liens) affecting the related Mortgaged Property
which are or may be liens prior to or equal to the lien of the related
Mortgage.
(viii) All taxes, governmental assessments, insurance premiums, water,
sewer and municipal charges, leasehold payments or ground rents which
previously became due and owing have been paid, or escrow funds have been
established in an amount sufficient to pay for every such escrowed item which
remains unpaid and which has been assessed but is not yet due and payable.
(ix) The Mortgage Note and the Mortgage are not subject to any right of
rescission, set-off, counterclaim or defense, including, without limitation,
the defense of usury, nor will the operation of any of the terms of the
Mortgage Note or the Mortgage, or the exercise of any right thereunder, render
the Mortgage Note or Mortgage unenforceable, in whole or in part, or subject
to any right of rescission, set-off, counterclaim or defense, including the
defense of usury, and no such right of rescission, set-off, counterclaim or
defense has been asserted with respect thereto.
(x) The Mortgaged Property is not subject to any material damage by
waste, fire, earthquake, windstorm, flood or other casualty. At origination of
the Mortgage Loan there was, and there currently is, no proceeding pending for
the total or partial condemnation of the Mortgaged Property.
(xi) All improvements subject to the Mortgage which were considered in
determining the appraised value of the Mortgaged Property lie wholly within
the boundaries and building restriction lines of the Mortgaged Property (and
wholly within the project with respect to a
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condominium unit) and no improvements on adjoining properties encroach upon
the Mortgaged Property except those which are insured against by a title
insurance policy and all improvements on the property comply with all
applicable zoning and subdivision laws and ordinances.
(xii) Seller has delivered or caused to be delivered to the Trustee or
the Custodian on behalf of the Trustee the original Mortgage bearing evidence
that such instruments have been recorded in the appropriate jurisdiction where
the Mortgaged Property is located as determined by the Seller (or, in lieu of
the original of the Mortgage or the assignment thereof, a duplicate or
conformed copy of the Mortgage or the instrument of assignment, if any,
together with a certificate of receipt from the Seller or the settlement agent
who handled the closing of the Mortgage Loan, certifying that such copy or
copies represent true and correct copy(ies) of the originals) and that such
original(s) have been or are currently submitted to be recorded in the
appropriate governmental recording office of the jurisdiction where the
Mortgaged Property is located) or a certification or receipt of the recording
authority evidencing the same.
(xiii) The Mortgage File contains each of the documents specified in
Section 2.01(b) of the Agreement.
(xiv) As of the Closing Date, each Mortgage Loan shall be serviced in all
material respects in accordance with the terms of the Agreement.
(xv) All buildings or other customarily insured improvements upon the
Mortgaged Property are insured by an insurer acceptable under the FNMA Guides,
against loss by fire, hazards of extended coverage and such other hazards as
are provided for in the FNMA Guides or by FHLMC, as well as all additional
requirements set forth in this Agreement. All such standard hazard policies
are in full force and effect and on the date of origination contained a
standard mortgagee clause naming the Seller and its successors in interest and
assigns as loss payee and such clause is still in effect and all premiums due
thereon have been paid. If at the time of origination, the Mortgage Loan was
required to have flood insurance coverage in accordance with the Flood
Disaster Protection Act of 1973, as amended, such Mortgage Loan is covered by
a flood insurance policy meeting the requirements of the current guidelines of
the Federal Insurance Administration which policy conforms to FNMA and FHLMC
requirements, as well as all additional requirements set forth in this
Agreement. Such policy was issued by an insurer acceptable under FNMA or FHLMC
guidelines. The Mortgage obligates the Mortgagor thereunder to maintain all
such insurance at the Mortgagor's cost and expense, and upon the Mortgagor's
failure to do so, authorizes the holder of the Mortgage to maintain such
insurance at the Mortgagor's cost and expense and to seek reimbursement
therefor from the Mortgagor.
(xvi) With respect to a Mortgage Loan, the Mortgage creates a first lien
or a first priority ownership interest in an estate in fee simple in real
property securing the related Mortgage Note.
(xvii) As of the Cut-off Date, no Mortgage Loan is (a) a non-performing
loan (i.e., a mortgage loan that is more than 90 days delinquent); (b) a
re-performing loan (i.e. a mortgage loan that was more than 90 days delinquent
within the twelve-month period preceding the Cut-off Date but is contractually
current); or (c) a sub-performing loan (i.e. a mortgage loan that
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is at least 30 days delinquent but subject to a payment plan or agreement
pursuant to which the Mortgagor is contractually current).
(xix) The Mortgage Note and the related Mortgage are original and genuine
and each is the legal, valid and binding obligation of the maker thereof,
enforceable in all respects in accordance with its terms subject to
bankruptcy, insolvency, moratorium, reorganization and other laws of general
application affecting the rights of creditors and by general equitable
principles.
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