EXECUTION
EXHIBIT 10.13
XXXXXXXXX MORTGAGE SECURITIES
TRUST 2003-4, as Issuer,
XXXXXXXXX MORTGAGE HOME LOANS, INC.,
as Seller,
GREENWICH CAPITAL ACCEPTANCE, INC.,
as Depositor,
XXXXX FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION, as Master Servicer,
and
DEUTSCHE BANK NATIONAL TRUST COMPANY,
as Indenture Trustee
--------------------
SALE AND SERVICING AGREEMENT
Dated as of August 1, 2003
--------------------------
XXXXXXXXX MORTGAGE SECURITIES TRUST 2003-4
MORTGAGE-BACKED NOTES,
SERIES 2003-4
TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS ........................................................................................ 1
Section 1.01. Definitions .................................................................................... 1
Section 1.02. Calculations Respecting Mortgage Loans ......................................................... 28
Section 1.03. Calculations Respecting Accrued Interest ....................................................... 28
ARTICLE II CONVEYANCE OF MORTGAGE LOANS ...................................................................... 29
Section 2.01. Conveyance of Mortgage Loans ................................................................... 29
Section 2.02. Acceptance of Trust Estate; Review of Documentation ............................................ 32
Section 2.03. Grant Clause ................................................................................... 34
ARTICLE III REPRESENTATIONS AND WARRANTIES ................................................................... 35
Section 3.01. Representations and Warranties of the Depositor ................................................ 35
Section 3.02. Representations and Warranties of the Master Servicer .......................................... 37
Section 3.03. Repurchase or Substitution of Mortgage Loans by Seller ......................................... 39
Section 3.04. Representations and Warranties of the Seller with Respect to the Mortgage Loans ................ 42
Section 3.05. Representations and Warranties of the Seller ................................................... 43
Section 3.06. Covenants of the Seller ........................................................................ 44
ARTICLE IV ADMINISTRATION AND SERVICING OF MORTGAGE LOANS BY THE MASTER SERVICER ............................. 45
Section 4.01. Master Servicer to Service and Administer the Mortgage Loans ................................... 45
Section 4.02. Monitoring of Servicers ........................................................................ 46
Section 4.03. Fidelity Bond .................................................................................. 47
Section 4.04. Power to Act; Procedures ....................................................................... 47
Section 4.05. Due-on-Sale Clauses; Assumption Agreement ...................................................... 48
Section 4.06 Release of Mortgage Files ...................................................................... 49
Section 4.07. Documents, Records and Funds in Possession of Master Servicer To Be Held for Indenture Trustee.. 49
Section 4.08. Standard Hazard Insurance and Flood Insurance Policies ......................................... 50
Section 4.09. Maintenance of the Primary Insurance Policies .................................................. 51
Section 4.10. Indenture Trustee to Retain Possession of Certain Insurance Policies and Documents ............. 51
Section 4.11. Realization Upon Defaulted Mortgage Loans ...................................................... 52
Section 4.12. Compensation to the Master Servicer ............................................................ 52
Section 4.13. REO Property ................................................................................... 52
Section 4.14. Annual Officer's Certificate as to Compliance .................................................. 53
Section 4.15. Annual Independent Accountant's Servicing Report ............................................... 53
Section 4.16. Reports Filed with Securities and Exchange Commission .......................................... 54
Section 4.17. Amendments to Master Servicing Guide and Correspondent Sellers Guide ........................... 55
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Section 4.18. Optional Purchase of Certain Mortgage Loans .................................................... 55
Section 4.19. Closing Certificate and Opinion ................................................................ 56
Section 4.20. Liabilities of the Master Servicer ............................................................. 56
Section 4.21. Merger or Consolidation of the Master Servicer ................................................. 56
Section 4.22. Indemnification of the Indenture Trustee, the Depositor, the Owner Trustee, the Administrator
and the Master Servicer ........................................................................ 56
Section 4.23. Limitations on Liability of the Master Servicer and Others ..................................... 57
Section 4.24. Master Servicer Not to Resign .................................................................. 59
Section 4.25. Successor Master Servicer ...................................................................... 59
Section 4.26. Sale and Assignment of Master Servicing ........................................................ 59
Section 4.27. Determination of LIBOR ......................................................................... 60
Section 4.28. Realization upon Troubled Mortgage Loans ....................................................... 60
ARTICLE V DEPOSITS AND PAYMENTS TO HOLDERS ................................................................... 60
Section 5.01. Servicing Accounts ............................................................................. 60
Section 5.02. Collection Account ............................................................................. 62
Section 5.03. Permitted Withdrawals and Transfers from the Collection Account ................................ 63
Section 5.04. The Note Account ............................................................................... 65
Section 5.05. Yield Maintenance Account ...................................................................... 66
Section 5.06. Payments from the Note Account ................................................................. 67
Section 5.07. Allocation of Losses and Net Interest Shortfalls ............................................... 69
Section 5.08. The Certificate Account ........................................................................ 70
Section 5.09. Control of the Trust Accounts .................................................................. 70
Section 5.10. Statements ..................................................................................... 74
Section 5.11. Advances ....................................................................................... 76
Section 5.12. Compensating Interest Payments ................................................................. 77
ARTICLE VI MASTER SERVICER EVENTS OF DEFAULT ................................................................. 77
Section 6.01. Master Servicer Events of Default; Indenture Trustee To Act; Appointment of Successor .......... 77
Section 6.02. Indenture Trustee to Act ....................................................................... 79
Section 6.03. Waiver of Master Servicer Event of Default ..................................................... 80
Section 6.04. Notification to Holders ........................................................................ 81
ARTICLE VII TERMINATION ...................................................................................... 81
Section 7.01. Termination .................................................................................... 81
Section 7.02. Optional Note Purchase ......................................................................... 81
Section 7.03. Optional Termination ........................................................................... 82
Section 7.04. Procedure Upon Termination ..................................................................... 82
ARTICLE VIII MISCELLANEOUS PROVISIONS ........................................................................ 83
Section 8.01. Binding Nature of Agreement; Assignment ........................................................ 83
Section 8.02. Entire Agreement ............................................................................... 83
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Section 8.03. Amendment ...................................................................................... 83
Section 8.04. Acts of Securityholders ........................................................................ 84
Section 8.05. Recordation of Agreement ....................................................................... 84
Section 8.06. Governing Law .................................................................................. 84
Section 8.07. Notices ........................................................................................ 84
Section 8.08. Severability of Provisions ..................................................................... 85
Section 8.09. Indulgences; No Waivers ........................................................................ 85
Section 8.10. Headings Not To Affect Interpretation .......................................................... 85
Section 8.11. Benefits of Agreement .......................................................................... 86
Section 8.12. Special Notices to the Rating Agencies ......................................................... 86
Section 8.13. Counterparts ................................................................................... 86
Section 8.14. Execution by the Issuer ........................................................................ 86
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ATTACHMENTS
Exhibit A-1 Form of Initial Certification
Exhibit A-2 Form of Interim Certification
Exhibit A-3 Form of Final Certification
Exhibit B Request for Release of Documents and Receipt
Exhibit C Servicing Agreements
Exhibit D Servicers
Exhibit E Form of Lost Note Affidavit
Schedule A Mortgage Loan Schedule
Schedule B Converted Mortgage Loan Schedule
Schedule C Modified Mortgage Loan Schedule
Schedule D Five-Year Hybrid Mortgage Loans
Schedule E Seven-Year Hybrid Mortgage Loans
Schedule F Ten-Year Hybrid Mortgage Loans
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This SALE AND SERVICING AGREEMENT, dated as of August 1, 2003 (the
"Agreement" or the "Sale and Servicing Agreement"), is by and among XXXXXXXXX
MORTGAGE SECURITIES TRUST 2003-4, a Delaware business trust, as issuer (the
"Issuer"), XXXXXXXXX MORTGAGE HOME LOANS, INC., a Delaware corporation, as
seller (the "Seller"), GREENWICH CAPITAL ACCEPTANCE, INC., a Delaware
corporation, as depositor (the "Depositor"), DEUTSCHE BANK NATIONAL TRUST
COMPANY, as Indenture Trustee (the "Indenture Trustee") and XXXXX FARGO BANK
MINNESOTA, NATIONAL ASSOCIATION, as master servicer (the "Master Servicer").
PRELIMINARY STATEMENT
WHEREAS, the Depositor has acquired the Mortgage Loans from Xxxxxxxxx
Mortgage Home Loans, Inc. (the "Seller") pursuant to the Mortgage Loan Purchase
Agreement, and at the Closing Date is the owner of the Mortgage Loans and the
other property being conveyed by it to the Issuer hereunder for inclusion in the
Trust Estate;
WHEREAS, on the Closing Date, the Depositor will acquire the Notes and
the Trust Certificate from the Issuer, as consideration for its transfer to the
Issuer of the Mortgage Loans and the other property constituting the Trust
Estate;
WHEREAS, the Depositor has duly authorized the execution and delivery
of this Agreement to provide for the conveyance to the Issuer of the Mortgage
Loans and the other property constituting the Trust Estate and the servicing of
the Mortgage Loans;
WHEREAS, pursuant to the Indenture, the Issuer will pledge the Mortgage
Loans and the other property constituting the Trust Estate to the Indenture
Trustee as security for the Notes;
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, the Issuer, the Depositor, the Seller, the Master Servicer and the
Indenture Trustee agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. The following words and phrases, unless the
context otherwise requires, shall have the following meanings:
Accepted Servicing Practices: With respect to any Mortgage Loan, as
applicable, either (x) those customary mortgage servicing practices of prudent
mortgage servicing institutions that master service mortgage loans of the same
type and quality as such Mortgage Loan in the jurisdiction where the related
Mortgaged Property is located, to the extent applicable to the Indenture Trustee
or the Master Servicer (except in its capacity as successor to a Servicer), or
(y) as provided in the applicable Servicing Agreement, to the extent applicable
to any Servicer, but in no event below the standard set forth in clause (x).
Accountant: A person engaged in the practice of accounting who (except
when this Agreement provides that an Accountant must be Independent) may be
employed by or affiliated with the Depositor or an Affiliate of the Depositor.
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Accrual Period: With respect to any Payment Date and any Class of
Notes, the period beginning on the 25th day in the calendar month immediately
preceding the month in which the related Payment Date occurs (or, in the case of
the first Payment Date, beginning on August 28, 2003) and ending on the 24th day
in the calendar month in which the related Payment Date occurs.
Additional Collateral: With respect to any Additional Collateral
Mortgage Loan, the marketable securities subject to a security interest pursuant
to the related pledge agreement.
Additional Collateral Mortgage Loan: Each Mortgage Loan identified as
such in the Mortgage Loan Schedule and as to which Additional Collateral is then
required to be provided as security therefor.
Adjustment Date: With respect to each Mortgage Loan, each adjustment
date on which the related Loan Rate changes pursuant to the related Mortgage
Note. The first Adjustment Date following the Cut-Off Date as to each Mortgage
Loan is set forth in the Mortgage Loan Schedule.
Administration Agreement: The Administration Agreement dated as of
August 1, 2003 among the Issuer, the Administrator and the Depositor, as such
may be amended or supplemented from time to time.
Administrator: Deutsche Bank National Trust Company, or any successor
in interest thereto, in its capacity as Administrator under the Administration
Agreement.
Advance: As to any Mortgage Loan or REO Property, any advance made by
the Master Servicer in respect of any Payment Date pursuant to Section 5.11.
Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Agreement: This Sale and Servicing Agreement and all amendments and
supplements hereto.
Applied Loss Amount: With respect to any Payment Date and any Class of
Notes (other than the Class A-1 Notes), the excess of (x) the aggregate Note
Principal Amount of such Notes after giving effect to distributions of principal
on such Notes on such Payment Date, but before giving effect to any application
of the Applied Loss Amount with respect to such date, over (y) the Pool Balance
for such Payment Date as reduced by all Realized Losses incurred with respect to
the Mortgage Loans during the related Due Period.
Assignment: As to any Mortgage, an assignment of mortgage, notice of
transfer or equivalent instrument, in recordable form, which is sufficient,
under the laws of the jurisdiction
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in which the related Mortgaged Property is located, to reflect or record the
sale of such Mortgage.
Bankruptcy: As to any Person, the making of an assignment for the
benefit of creditors, the filing of a voluntary petition in bankruptcy,
adjudication as a bankrupt or insolvent, the entry of an order for relief in a
bankruptcy or insolvency proceeding, the seeking of reorganization, arrangement,
composition, readjustment, liquidation, dissolution or similar relief, or
seeking, consenting to or acquiescing in the appointment of a trustee, receiver
or liquidator, dissolution, or termination, as the case may be, of such Person
pursuant to the provisions of either the United States Bankruptcy Code of 1986,
as amended, or any other similar state laws.
Bankruptcy Code: The United States Bankruptcy Code of 1986, as amended.
Base Value: With respect to any Mortgage Loan for which Additional
Collateral has been pledged, the value of the Additional Collateral as
determined with respect to that Mortgage Loan in accordance with the applicable
underwriting guidelines.
Book-Entry Notes: As defined in the Indenture.
Business Day: Any day other than (i) a Saturday or a Sunday, (ii) a day
on which banking institutions in California, Minnesota, Maryland, New York,
Delaware or the city in which the Corporate Trust Office of the Indenture
Trustee is located are authorized or obligated by law or executive order to be
closed.
Carryforward Interest: With respect to any Payment Date and each Class
of Notes, the sum of (i) the excess of (x) the sum of (A) Current Interest for
such Class for the immediately preceding Payment Date and (B) any unpaid
Carryforward Interest for such Class from previous Payment Dates over (y) the
amount distributed in respect of interest on such Class on such immediately
preceding Payment Date and (ii) interest on such amount for the related Accrual
Period at the applicable Note Interest Rate.
Certificate Account: The account maintained by the Administrator
pursuant to Section 5.08.
Certificateholder: As defined in the Trust Agreement.
Class: All Notes bearing the same class designation.
Class Principal Amount: With respect to each Class of Notes, the
aggregate of the Note Principal Amounts of all Notes of such Class at the date
of determination.
Closing Date: August 28, 2003.
Code: The Internal Revenue Code of 1986, as amended, and as it may be
further amended from time to time, any successor statutes thereto, and
applicable U.S. Department of Treasury regulations issued pursuant thereto in
temporary or final form.
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Collection Account: A separate account established and maintained by
the Master Servicer pursuant to Section 5.02, which shall be entitled "Xxxxx
Fargo Bank Minnesota, National Association, as Master Servicer for Deutsche Bank
National Trust Company, as Indenture Trustee, in trust for the registered
Holders of Xxxxxxxxx Mortgage Securities Trust 2003-4, Mortgage-Backed
Securities, Series 2003-4" and which must be an Eligible Account.
Compensating Interest Payment: With respect to any Payment Date, an
amount equal to the amount, if any, by which (x) the aggregate amount of any
Prepayment Interest Shortfalls with respect to such Payment Date exceeds (y) the
aggregate amount actually paid by the Servicers in respect of such shortfalls;
provided, that such amount, to the extent payable by the Master Servicer, shall
not exceed the aggregate Master Servicing Fee that would be payable to the
Master Servicer in respect of such Payment Date without giving effect to any
Compensating Interest Payment.
Control: The meaning specified in Section 8-106 of the New York UCC.
Converted Loan: Any Convertible Mortgage Loan as to which the Mortgagor
thereunder has exercised its right under the related Mortgage Note to convert
the adjustable Loan Rate thereon to a fixed Loan Rate.
Converted Mortgage Loan Schedule: With respect to each Payment Date, a
schedule listing each Convertible Mortgage Loan that has become a Converted
Mortgage Loan during the immediately preceding Due Period, and the Purchase
Price for each such Converted Mortgage Loan in the form attached hereto as
Schedule B.
Convertible Mortgage Loan: Any Mortgage Loan which, at the option of
the Mortgagor and in accordance with the terms of the related Mortgage Note, may
have the related Loan Rate converted from an adjustable rate to a fixed rate.
Cooperative Corporation: The entity that holds title (fee or an
acceptable leasehold estate) to the real property and improvements constituting
the Cooperative Property and which governs the Cooperative Property, which
Cooperative Corporation must qualify as a Cooperative Housing Corporation under
Section 216 of the Code.
Cooperative Loan: Any Mortgage Loan secured by Cooperative Shares and a
Proprietary Lease.
Cooperative Loan Documents: As to any Cooperative Loan, (i) the
Cooperative Shares, together with a stock power in blank; (ii) the original
executed Security Agreement and the assignment of the Security Agreement
endorsed in blank; (iii) the original executed Proprietary Lease and the
assignment of the Proprietary Lease endorsed in blank; (iv) the original
executed Recognition Agreement and the assignment of the Recognition Agreement
(or a blanket assignment of all Recognition Agreements) endorsed in blank; (v)
the executed UCC-1 financing statement with evidence of recording thereon, which
has been filed in all places required to perfect the security interest in the
Cooperative Shares and the Proprietary Lease; and (vi) executed UCC-3 financing
statements (or copies thereof) or other appropriate UCC financing
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statements required by state law, evidencing a complete and unbroken line from
the mortgagee to the Indenture Trustee with evidence of recording thereon (or in
a form suitable for recordation).
Cooperative Property: The real property and improvements owned by the
Cooperative Corporation, that includes the allocation of individual dwelling
units to the holders of the Cooperative Shares of the Cooperative Corporation.
Cooperative Shares: Shares issued by a Cooperative Corporation.
Cooperative Unit: A single-family dwelling located in a Cooperative
Property.
Corporate Trust Office: The principal corporate trust office of the
Indenture Trustee at which, at any particular time, its corporate trust business
shall be administered, which office at the date hereof is located at 0000 Xxxx
Xx. Xxxxxx Xxxxx, Xxxxx Xxx, XX 00000, Attention: Xxxxxxxxx 2003-4 (TM0304).
Correspondent Sellers Guide: The Seller's Correspondent Sellers Guide,
revised January 2003 and as revised from time to time.
Current Interest: With respect to each Class of Notes and any Payment
Date, the aggregate amount of interest accrued at the applicable Note Interest
Rate during the related Accrual Period on the Class Principal Amount of such
Class immediately prior to such Payment Date less any Net Interest Shortfalls
allocated to each such Class pursuant to Section 5.07(b).
Custodian: Deutsche Bank National Trust Company, and its successors
acting as custodian of the Mortgage Files on behalf of the Indenture Trustee.
Cut-off Date: With respect to any Mortgage Loan other than a Qualified
Substitute Mortgage Loan, the close of business in New York City on August 1,
2003. With respect to any Qualified Substitute Mortgage Loan, the date
designated as such on the Mortgage Loan Schedule (as amended).
Cut-off Date Balance: With respect to the Mortgage Loans, the Pool
Balance as of the Cut-off Date.
Cut-off Date Principal Balance: With respect to each Mortgage Loan, the
unpaid principal balance thereof as of the Cut-off Date.
Debt Service Reduction: With respect to any Mortgage Loan, a reduction
in the Monthly Payment for that Mortgage Loan by a court of competent
jurisdiction in a proceeding under the Bankruptcy Code, unless the reduction
results from a Deficient Valuation.
Deferred Amount: With respect to any Payment Date and each Class of
Subordinate Notes and the Class A-2 Notes, an amount equal to the amount by
which (x) the aggregate of Applied Loss Amounts previously applied in reduction
of the Note Principal Amount thereof exceeds (y) the aggregate of amounts
previously paid in reimbursement thereof.
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Deficient Valuation: With respect to any Mortgage Loan, a valuation of
the related Mortgaged Property by a court of competent jurisdiction in an amount
less than the then outstanding principal balance of the Mortgage Loan, which
valuation results from a proceeding initiated under the Bankruptcy Code.
Delayed Delivery Mortgage Loans: The Mortgage Loans identified on the
Mortgage Loan Schedule for which the related Mortgage Note is not delivered to
the Indenture Trustee by the Closing Date. The Depositor shall deliver the
Mortgage Notes to the Indenture Trustee:
(A) for at least 99% of the Mortgage Loans, not later than the
Closing Date, and
(B) for the remaining 1% of the Mortgage Loans, not later than 90
days following the Closing Date.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased from the
Trust Estate pursuant to the terms hereof or for which one or more Qualified
Substitute Mortgage Loans are substituted.
Depositor: Greenwich Capital Acceptance, Inc., a Delaware corporation
having its principal place of business in Connecticut, or its successors in
interest.
Determination Date: For any Payment Date and each Mortgage Loan, the
date each month, as set forth in the related Servicing Agreement, on which the
related Servicer determines the amount of all funds that are required to be
remitted to the Master Servicer on the Servicer Remittance Date with respect to
the Mortgage Loans it is servicing.
Due Date: With respect to each Mortgage Loan and any Payment Date, the
first day of the calendar month in which that Payment Date occurs on which the
Monthly Payment for such Mortgage Loan was due, exclusive of any days of grace.
Due Period: With respect to any Payment Date and Mortgage Loan, the
period commencing on the second day of the month immediately preceding the month
in which such Payment Date occurs and ending on the first day of the month in
which such Payment Date occurs.
Eligible Account: Any of
(i) an account or accounts maintained with a federal or
state chartered depository institution or trust company the short-term
unsecured debt obligations of which (or, in the case of a depository
institution or trust company that is the principal subsidiary of a
holding company, the short-term unsecured debt obligations of such
holding company) are rated in the highest short term rating category of
each Rating Agency at the time any amounts are held on deposit therein;
(ii) an account or accounts the deposits in which are
fully insured by the FDIC (to the limits established by it), the
uninsured deposits in which account are otherwise secured such that, as
evidenced by an Opinion of Counsel delivered to the Indenture
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Trustee and to each Rating Agency, the Securityholders will have a
claim with respect to the funds in the account or a perfected first
priority security interest against the collateral (which shall be
limited to Permitted Investments) securing those funds that is superior
to claims of any other depositors or creditors of the depository
institution with which such account is maintained;
(iii) a trust account or accounts maintained with the trust
department of a federal or state chartered depository institution,
national banking association or trust company acting in its fiduciary
capacity; or
(iv) an account otherwise acceptable to each Rating Agency
without reduction or withdrawal of its then current ratings of the
Notes as evidenced by a letter from each Rating Agency to the Indenture
Trustee. Eligible Accounts may bear interest.
Employee Loan: Any Mortgage Loan identified as such in the Mortgage
Loan Schedule and which was originated by the Seller, which provides for an
increase in the Loan Rate thereof in the event of the change of employment of
the Mortgagor thereunder.
Entitlement Holder: The meaning specified in Section 8-102(a)(7) of the
New York UCC.
Entitlement Order: The meaning specified in Section 8-102(a)(8) of the
New York UCC (i.e., generally, orders directing the transfer or redemption of
any Financial Asset).
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
Escrow Account: Any account with respect to tax and insurance escrow
payments established and maintained by each Servicer pursuant to the related
Servicing Agreement.
Excess Yield Maintenance Amount: As defined in Section 5.05.
Expense Fee: With respect to any Mortgage Loan, the sum of (i) the
Retained Interest, if any, (ii) the Master Servicing Fee, (iii) the related
Servicing Fee with respect to the related Servicer and (iv) the Indenture
Trustee Fee for such Mortgage Loan.
Expense Fee Rate: With respect to any Mortgage Loan, the per annum rate
at which the Expense Fee accrues for such Mortgage Loan as set forth in the
Mortgage Loan Schedule.
Extra Principal Distribution Amount: With respect to any Payment Date,
the lesser of (a) Monthly Excess Interest for such Payment Date and (b) the
Overcollateralization Deficiency for such Payment Date.
Xxxxxx Xxx: Federal National Mortgage Association, a federally
chartered and privately owned corporation organized and existing under the
Federal National Mortgage Association Charter Act, or any successor thereto.
FDIC: The Federal Deposit Insurance Corporation or any successor
thereto.
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Financial Asset: The meaning specified in Section 8-102(a) of the New
York UCC.
Five-Year Hybrid Mortgage Loans: The Mortgage Loans set forth on
Schedule D hereto.
Xxxxxxx Mac: 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.
GNMA: The Government National Mortgage Association, a wholly owned
corporate instrumentality of the United States within HUD.
Gross Margin: With respect to each Mortgage Loan, the fixed percentage
set forth in the related Mortgage Note that is added to the applicable Index on
each Adjustment Date in accordance with the terms of the related Mortgage Note
used to determine the Loan Rate for such Mortgage Loan.
Guaranty Surety Bond: With respect to the Additional Collateral
Mortgage Loans acquired by the Seller from MSDWCC, the Limited Purpose Surety
Bond (No. ABO240BE) issued by the Surety.
Holder or Securityholder: The registered holder of any Note or Trust
Certificate as recorded on the books of the Note Registrar or the Certificate
Registrar except that, solely for the purposes of taking any action or giving
any consent pursuant to this Agreement, any Note or Trust Certificate registered
in the name of the Depositor, the Indenture Trustee or any Affiliate thereof
shall be deemed not to be outstanding in determining whether the requisite
percentage necessary to effect any such consent has been obtained, except that,
in determining whether the Indenture Trustee shall be protected in relying upon
any such consent, only Notes and Trust Certificates which a Responsible Officer
of the Indenture Trustee has actual knowledge to be so held shall be
disregarded. The Indenture Trustee may request and conclusively rely on
certifications by the Depositor in determining whether any Notes or Trust
Certificates are registered to an Affiliate of the Depositor.
HUD: The United States Department of Housing and Urban Development, or
any successor thereto.
Indemnified Persons: The Indenture Trustee, the Administrator, the
Seller, the Owner Trustee, the Master Servicer and the Depositor and their
officers, directors, agents and employees and, with respect to the Indenture
Trustee, any separate co-trustee and its officers, directors, agents and
employees.
Indenture: The Indenture dated as of August 1, 2003, between the Issuer
and the Indenture Trustee, as such may be amended or supplemented from time to
time.
Indenture Trustee: Deutsche Bank National Trust Company, not in its
individual capacity but solely as Indenture Trustee, or any successor in
interest which accepts its appointment as Indenture Trustee hereunder and agrees
to act in such capacity in accordance herewith.
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Indenture Trustee Fee: As defined in the Indenture.
Indenture Trustee Fee Rate: 0.0005% per annum.
Independent: When used with respect to any Accountant and a specified
Person, an Accountant who is "independent" within the meaning of Rule 2-01(b) of
the Securities and Exchange Commission's Regulation S-X. When used with respect
to any Person other than an Accountant and a specified Person, a Person who (a)
is in fact independent of such specified Person and any Affiliate of such
specified Person, (b) does not have any material direct financial interest in
such specified Person or any Affiliate of such specified Person, and (c) is not
connected with such specified Person or any Affiliate of such specified Person
as an officer, employee, promoter, underwriter, trustee, partner, director or
Person performing similar functions, provided, however, that a Person shall not
fail to be Independent of such specified Person or any Affiliate thereof merely
because such Person is the beneficial owner of 1% or less of any class of
securities issued by such specified Person or any Affiliate thereof.
Index: With respect to each Mortgage Loan and each Adjustment Date, the
index specified in the related Mortgage Note.
Initial LIBOR Rate: 1.110%.
Initial Optional Notes Purchase Date: The first Payment Date that the
aggregate Scheduled Principal Balance of the Mortgage Loans as of the end of the
immediately preceding Due Period is equal to or less than 20% of the Cut-off
Date Balance.
Insurance Proceeds: With respect to any Mortgage Loan, proceeds of any
title policy, hazard policy or other insurance policy covering a Mortgage Loan,
to the extent such proceeds are not to be applied to the restoration of the
related Mortgaged Property or released to the related Mortgagor in accordance
with the related Servicing Agreement.
Interest Remittance Amount: With respect to any Payment Date and with
respect to all of the Mortgage Loans, (a) the sum of (1) all interest collected
(other than Payaheads) or advanced in respect of Monthly Payments on the
Mortgage Loans during the related Due Period by the Servicers or the Master
Servicer, minus (i) Servicing Fee and the Master Servicing Fee with respect to
such Mortgage Loans, (ii) any Retained Interest and (iii) previously
unreimbursed Advances due to the Servicers or the Master Servicer to the extent
allocable to interest and the allocable portion of previously unreimbursed
Servicing Advances with respect to the Mortgage Loans, (2) any Compensating
Interest Payments with respect to the related Prepayment Period with respect to
the Mortgage Loans, (3) the portion of any Purchase Price or Substitution
Adjustment paid with respect to the Mortgage Loans during the related Prepayment
Period allocable to interest, (4) the portion of any Termination Price allocable
to interest received in connection with an Optional Termination pursuant to
Section 7.03, (5) the interest portion of any amount paid under the Guaranty
Surety Bond and (6) all Net Liquidation Proceeds, Insurance Proceeds and any
other recoveries collected with respect to the Mortgage Loans during the related
Prepayment Period, to the extent allocable to interest, as reduced by (b) any
Prepayment Penalty Amount and other costs, expenses or liabilities reimbursable
to the Indenture Trustee, the
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Administrator, the Master Servicer, the Owner Trustee and each Servicer to the
extent provided in the Operative Agreements and each Servicing Agreement.
LIBOR: With respect to the first Accrual Period, the Initial LIBOR
Rate. With respect to each subsequent Accrual Period, a per annum rate
determined on the related LIBOR Determination Date in the following manner by
the Master Servicer for the one-month United States dollar deposits, as such
rates appear on the Telerate Page 3750, as of 11:00 a.m. (London time) on such
LIBOR Determination Date.
(a) If on such a LIBOR Determination Date, LIBOR does not appear
on the Telerate Page 3750 as of 11:00 a.m. (London time), or if the Telerate
Page 3750 is not available on such date, the Master Servicer will obtain such
rate from Reuters' "page LIBOR 01" or Bloomberg's page "BBAM." If such rate is
not published for such LIBOR Determination Date, LIBOR shall be the Reference
Bank Rate. If the Reference Bank Rate is unavailable, LIBOR for such date will
be LIBOR applicable to the preceding Accrual Period.
(b) The establishment of LIBOR by the Master Servicer and the
Master Servicer's subsequent calculation of each Note Interest Rate applicable
to the Notes for the relevant Accrual Period, in the absence of manifest error,
will be final and binding.
LIBOR Business Day: Any day on which banks in London, England and The
City of New York are open and conducting transactions in foreign currency and
exchange.
LIBOR Determination Date: The second LIBOR Business Day immediately
preceding the commencement of each Accrual Period for any Notes.
Liquidated Mortgage Loan: As to any Payment Date, any Mortgage Loan in
respect of which the related Servicer or the Master Servicer has determined, in
accordance with the servicing procedures specified herein, as of the end of the
related Prepayment Period, that all Liquidation Proceeds that it expects to
recover with respect to the liquidation of such Mortgage Loan or disposition of
the related REO Property have been recovered.
Liquidation Expenses: With respect to a Mortgage Loan in liquidation,
unreimbursed expenses paid or incurred by or for the account of the Master
Servicer or the related Servicers, such expenses including (a) property
protection expenses, (b) property sales expenses, (c) foreclosure and sale
costs, including court costs and reasonable attorneys' fees, and (d) similar
expenses reasonably paid or incurred in connection with liquidation.
Liquidation Proceeds: With respect to any Mortgage Loan, the amount
(other than amounts received in respect of the rental of any REO Property prior
to REO Disposition) received by the related Servicer as proceeds from the
liquidation of such Mortgage Loan, as determined in accordance with the
applicable provisions of the related Servicing Agreement; provided that (i) with
respect to any Mortgage Loan or REO Property repurchased, substituted or sold
pursuant to or as contemplated hereunder, or pursuant to the applicable
provisions of the related Servicing Agreement, "Liquidation Proceeds" shall also
include amounts realized in connection with such repurchase, substitution or
sale and (ii) with respect to a defaulted Additional Collateral Mortgage Loan,
"Liquidation Proceeds" shall also include the amount
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realized on the related Additional Collateral and pursuant to the Guaranty
Surety Bond with respect to such Mortgage Loan.
Loan Rate: As to any Mortgage Loan and any date of determination, the
per annum rate at which interest then accrues on such Mortgage Loan, as
determined under the related Mortgage Note.
Loan-to-Collateral Value Ratio: With respect to each Mortgage Loan and
any date of determination, a fraction, expressed as a percentage, the numerator
of which is the principal balance of the Mortgage Loan at such date of
determination less the Base Value of any related Additional Collateral and the
denominator of which is the Value of the related Mortgaged Property.
Loan-to-Value Ratio: With respect to each Mortgage Loan and any date of
determination, a fraction, expressed as a percentage, the numerator of which is
the principal balance of the Mortgage Loan at such date of determination and the
denominator of which is the Value of the related Mortgaged Property.
Lost Note Affidavit: With respect to any Mortgage Loan as to which the
original Mortgage Note has been permanently lost or destroyed and has not been
replaced, an affidavit from the Seller certifying that the original Mortgage
Note has been lost, misplaced or destroyed (together with a copy of the related
Mortgage Note and indemnifying the Issuer against any loss, cost or liability
resulting from the failure to deliver the original Mortgage Note) in the form of
Exhibit E hereto.
Majority Securityholders: Until such time as the sum of the Class
Principal Amounts of all Classes of Notes has been reduced to zero, the holder
or holders of in excess of 50% of the aggregate Class Principal Amount of all
Classes of Notes (accordingly, the holder of the Trust Certificate shall be
excluded from any rights or actions of the Majority Securityholders during such
period); and thereafter, the holder or holders of in excess of 50% of the
Percentage Interests of the Trust Certificate.
Margin: With respect each Class of the Class A-1 and Class A-2 Notes
and any Payment Date, the applicable percentage set forth below:
Payment Dates on or prior Payment Dates after the
to the Initial Optional Initial Optional
Class Notes Purchase Date Notes Purchase Date
----- ------------------------- -----------------------
A-1 0.32% 0.64%
A-2 0.60% 1.20%
Master Servicer: Xxxxx Fargo Bank Minnesota, National Association, or
any successor Master Servicer appointed as herein provided.
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Master Servicer Certification: A written certification covering
servicing of the Mortgage Loans by all Servicers and signed by an officer of the
Master Servicer that complies with (i) the Xxxxxxxx-Xxxxx Act of 2002, as
amended from time to time, and (ii) the February 21, 2003 Statement by the Staff
of the Division of Corporation Finance of the Securities and Exchange Commission
Regarding Compliance by Asset-Backed Issuers with Exchange Act Rules 13a-14 and
15d-14, as in effect from time to time; provided that if, after the Closing Date
(a) the Xxxxxxxx-Xxxxx Act of 2002 is amended, (b) the Statement referred to in
clause (ii) is modified or superceded by any subsequent statement, rule or
regulation of the Securities and Exchange Commission or any statement of a
division thereof, or (c) any future releases, rules and regulations are
published by the Securities and Exchange Commission from time to time pursuant
to the Xxxxxxxx-Xxxxx Act of 2002, which in any such case affects the form or
substance of the required certification and results in the required
certification being, in the reasonable judgment of the Master Servicer,
materially more onerous than the form of the required certification as of the
Closing Date, the Master Servicer Certification shall be as agreed to by the
Master Servicer, the Depositor and the Seller following a negotiation in good
faith to determine how to comply with any such new requirements.
Master Servicer Event of Default: With respect to the Master Servicer,
any one of the conditions or circumstances enumerated in Section 6.01(a).
Master Servicer Remittance Date: No later than 3 P.M. New York City
time one Business Day prior to each Payment Date.
Master Servicing Fee: As to any Payment Date and each related Mortgage
Loan, an amount equal to the product of the applicable Master Servicing Fee Rate
and the Scheduled Principal Balance of such Mortgage Loan. The Master Servicing
Fee for any Mortgage Loan shall be payable in respect of any Payment Date solely
from the interest portion of the Monthly Payment or other payment or recovery
with respect to such Mortgage Loan.
Master Servicing Fee Rate: 0.0175% per annum.
Master Servicing Guide: Xxxxx Fargo Conduit and Norwest Servicing
Guide, dated January 1997, as amended July 2001.
Maturity Date: With respect to any Class of Notes, the Payment Date in
September 2043.
Maximum Loan Rate: With respect to each Mortgage Loan, the percentage
set forth in the related Mortgage Note as the maximum Loan Rate thereunder.
MERS: Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or any successor
thereto.
MERS Mortgage Loan: Any Mortgage Loan registered with MERS on the MERS
System.
MERS(R) System: The system of recording transfers of mortgages
electronically maintained by MERS.
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MIN: The Mortgage Identification Number for any MERS Mortgage Loan.
Modifiable Mortgage Loan: Any Mortgage Loan which, at the option of the
Mortgagor and in accordance with the terms of the related Mortgage Note, may
have the related Loan Rate modified to any adjustable rate or hybrid product
offered at the time by the related originator.
Modified Mortgage Loan: Any Modifiable Mortgage Loan as to which the
related Mortgagor has exercised the right to modify the Loan Rate.
Modified Mortgage Loan Schedule: With respect to each Payment Date, a
schedule listing each Modifiable Mortgage Loan in the form set forth in Schedule
C hereto that has become a Modified Mortgage Loan during the immediately
preceding Due Period, and the Purchase Price for each such Modified Mortgage
Loan.
MOM Loan: Any Mortgage Loan as to which MERS is acting as mortgagee,
solely as nominee for the originator of such Mortgage Loan and its successors
and assigns.
Monthly Excess Interest: With respect to any Payment Date, any Interest
Remittance Amount remaining after giving effect to payment pursuant to Section
5.06(b)(iii).
Monthly Payment: With respect to any Mortgage Loan, the scheduled
monthly payment of principal and interest on such Mortgage Loan that is payable
by the related Mortgagor from time to time under the related Mortgage Note,
determined, for the purposes of this Agreement: (a) after giving effect to (i)
any Deficient Valuation and/or Debt Service Reduction with respect to such
Mortgage Loan and (ii) any reduction in the amount of interest collectible from
the related Mortgagor pursuant to the Relief Act; (b) without giving effect to
any extension granted or agreed to by the related Servicer pursuant to the
applicable provisions of the related Servicing Agreement; and (c) on the
assumption that all other amounts, if any, due under such Mortgage Loan are paid
when due.
Moody's: Xxxxx'x Investors Service, Inc., or any successor in interest.
Mortgage: The mortgage, deed of trust or other instrument creating a
first lien on, or first priority security interest in, a Mortgaged Property
securing a Mortgage Note.
Mortgage File: The mortgage documents listed in Section 2.01 pertaining
to a particular Mortgage Loan required to be delivered to the Indenture Trustee
pursuant to this Agreement.
Mortgage Loan: A Mortgage and the related notes or other evidences of
indebtedness secured by each such Mortgage conveyed, transferred, sold, assigned
to or deposited with the Indenture Trustee for the benefit of Securityholders
pursuant to Section 2.01 or Section 2.03(d), including without limitation, each
Mortgage Loan listed on the Mortgage Loan Schedule, as amended from time to
time.
Mortgage Loan Purchase Agreement: The mortgage loan purchase agreement,
dated as of August 1, 2003, for the sale of the Mortgage Loans by the Seller to
the Depositor.
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Mortgage Loan Schedule: As of any date, the list of Mortgage Loans
attached hereto as Schedule A. The Mortgage Loan Schedule shall be prepared by
the Seller and shall set 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 five-digit ZIP code;
(iv) a code indicating whether the Mortgaged Property was
represented by the borrower, at the time of origination, as being
owner-occupied;
(v) a code indicating whether the Residential Dwelling
constituting the Mortgaged Property is (a) a detached single family
dwelling, (b) a dwelling in a planned unit development, (c) a
condominium unit, (d) a two- to four-unit residential property, (e) a
townhouse or (f) other type of Residential Dwelling;
(vi) if the related Mortgage Note permits the borrower to
make Monthly Payments of interest only for a specified period of time,
(a) the original number of such specified Monthly Payments and (b) the
remaining number of such Monthly Payments as of the Cut-Off Date;
(vii) the original months to maturity;
(viii) the stated remaining months to maturity from the
Cut-Off Date based on the original amortization schedule;
(ix) the Loan-to-Value Ratio at origination;
(x) the value of any Additional Collateral at
origination;
(xi) the Loan-to-Collateral Value Ratio at origination;
(xii) the Loan Rate in effect immediately following the
Cut-Off Date;
(xiii) the date on which the first Monthly Payment is or was
due on the Mortgage Loan;
(xiv) the stated maturity date;
(xv) the Master Servicing Fee Rate and the Servicing Fee
Rate, if any;
(xvi) whether such loan is an Additional Collateral
Mortgage Loan or an Employee Loan;
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(xvii) the last Due Date on which a Monthly Payment was
actually applied to the unpaid Scheduled Principal Balance;
(xviii) the original principal balance of the Mortgage Loan;
(xix) the Scheduled Principal Balance of the Mortgage Loan
on the Cut-Off Date and a code indicating the purpose of the Mortgage
Loan (i.e., purchase financing, rate/term refinancing, cash-out
refinancing);
(xx) the Index and Gross Margin specified in related
Mortgage Note;
(xxi) the next Adjustment Date, if applicable;
(xxii) the Maximum Loan Rate, if applicable;
(xxiii) the Value of the Mortgaged Property;
(xxiv) the sale price of the Mortgaged Property, if
applicable;
(xxv) the product code;
(xxvi) the Retained Rate, if any; and
(xxvii) the Servicer, if any, that is servicing each Mortgage
Loan and the originator of the Mortgage Loan.
The Mortgage Loan Schedule, as in effect from time to time, shall also
set forth the following information with respect to the Mortgage Loans in the
aggregate as of the Cut-Off Date: (1) the number of Mortgage Loans; (2) the
current principal balance of the Mortgage Loans; (3) the weighted average Loan
Rate of the Mortgage Loans; and (4) the weighted average remaining months to
maturity of the Mortgage Loans. The Mortgage Loan Schedule shall be amended from
time to time by the Seller in accordance with the provisions of this Agreement.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage under a Mortgage Loan.
Mortgaged Property: Either of (x) the fee simple or leasehold interest
in real property, together with improvements thereto including any exterior
improvements to be completed within 120 days of disbursement of the related
Mortgage Loan proceeds, or (y) in the case of a Cooperative Loan, the related
Cooperative Shares and Proprietary Lease, securing the indebtedness of the
Mortgagor under the related Mortgage Loan.
Mortgagor: The obligor on a Mortgage Note.
MSDWCC: Xxxxxx Xxxxxxx Xxxx Xxxxxx Credit Corporation, a Delaware
corporation, and its successors and assigns.
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Net Interest Shortfall: With respect to each Payment Date, the sum of
(i) any Net Prepayment Interest Shortfalls for such Payment Date and (ii) the
aggregate amount of any Relief Act Reductions for such Payment Date.
Net Liquidation Proceeds: With respect to any Liquidated Mortgage Loan
or any other disposition of related Mortgaged Property (including REO Property)
the related Liquidation Proceeds net of Advances, related Servicing Advances,
Master Servicing Fee, related Servicing Fees and any other accrued and unpaid
servicing fees received and retained in connection with the liquidation of such
Mortgage Loan or Mortgaged Property, and any related Retained Interest.
Net Loan Rate: With respect to any Mortgage Loan as of any date of
determination, a per annum rate of interest equal to the then applicable Loan
Rate for such Mortgage Loan reduced by the then applicable Expense Rate for such
Mortgage Loan.
Net Prepayment Interest Shortfall: With respect to any Master Servicer
Remittance Date, the excess, if any, of any Prepayment Interest Shortfalls with
respect to the Mortgage Loans for such date over any amounts paid with respect
to such shortfalls by the Servicers or the Master Servicer pursuant to the
Servicing Agreements or this Agreement.
Net WAC Rate: With respect any Payment Date, the weighted average of
the Net Loan Rates of the Mortgage Loans as of the first day of the month
preceding the month in which such Payment Date occurs (or, in the case of the
first Payment Date, as of the Cut-off Date), weighted on the basis of the
related Principal Balances of the Mortgage Loans as of the first day of the
related Due Period.
Net WAC Shortfall: With respect to any Payment Date and any Class of
Notes, if, for such Payment Date, the Note Interest Rate is based on the
applicable Net WAC Rate, the excess of (i) the amount by which the amount of
interest calculated at the Note Interest Rate applicable to such Class for such
date, determined without regard to the Net WAC Rate for such date but subject to
a cap equal to the Weighted Average Cap Strike Rate over (ii) the sum of
interest calculated at the Net WAC Rate for such Payment Date and any amount
allocated to such Class under the Yield Maintenance Agreements.
Net WAC Shortfall Carryforward Amount: With respect to any Payment Date
and any Class of Notes, the sum of (i) any Net WAC Shortfall for such Payment
Date and (ii) the excess of (a) all previous Net WAC Shortfalls (including
interest accrued thereon at applicable Note Interest Rate) over (b) any amounts
previously paid with respect to Net WAC Shortfalls under the Yield Maintenance
Agreements, together with interest accrued thereon at the applicable Note
Interest Rate without regard to the Net WAC Rate for the related Accrual Period
but subject to a cap equal to the Weighted Average Cap Strike Rate.
New York UCC: The Uniform Commercial Code as in effect in the State of
New York.
Nonrecoverable: The determination by the Master Servicer or the related
Servicer in respect of a delinquent Mortgage Loan that if it were to make an
Advance in respect of thereof, such amount would not be recoverable from any
collections or other recoveries (including Liquidation Proceeds) on such
Mortgage Loan.
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Note: Any Class X-0, Xxxxx X-0, Class M-1 and Class M-2 Note.
Note Account: The account maintained by the Indenture Trustee pursuant
to Section 5.04 which shall be entitled "Note Account, Deutsche Bank National
Trust Company, as Indenture Trustee, in trust for the registered Holders of
Xxxxxxxxx Mortgage Securities Trust 2003-4, Mortgage-Backed Securities, Series
2003-4" and which must be an Eligible Account.
Note Purchase Option: As defined in the Indenture.
Note Purchase Price: As defined in the Indenture.
Noteholder: As defined in the Indenture.
Note Interest Rate: With respect to each Class of Notes and any Payment
Date, the applicable per annum rate set forth below:
Class Note Interest Rate
A-1 The Note Interest Rate with respect to any Payment Date (and
the related Accrual Period) for the Class A-1 Notes is the per
annum rate equal to the lesser of (i) LIBOR plus the
applicable Margin and (ii) the lesser of (a) the Net WAC Rate
for such Payment Date and (b) 11.50% per annum.
A-2 The Note Interest Rate with respect to any Payment Date (and
the related Accrual Period) for the Class A-2 Notes is the per
annum rate equal to the lesser of (i) LIBOR plus the
applicable Margin and (ii) the lesser of (a) the Net WAC Rate
for such Payment Date and (b) 11.50%.
M-1 The Note Interest Rate with respect to any Payment Date (and
the related Accrual Period) for the Class M-1 Notes is the per
annum rate equal to the lesser of (i) LIBOR plus 0.65% and
(ii) the lesser of (a) the Net WAC Rate for such Payment Date
and (b) 11.50% per annum.
M-2 The Note Interest Rate with respect to any Payment Date (and
the related Accrual Period) for the Class M-2 Notes is the per
annum rate equal to the lesser of (i) LIBOR plus 1.70% and
(ii) the lesser of (a) the Net WAC Rate for such Payment Date
and (b) 11.50% per annum.
Note Owner: As defined in the Indenture.
Note Principal Amount: With respect to any Note, the initial Note
Principal Amount thereof on the Closing Date, less the amount of all principal
payments previously paid with respect to such Note and, in the case of a
Subordinate Note, any Applied Loss Amount previously allocated to such Note.
Note Register and Note Registrar: As defined in the Indenture.
Offering Document: The Prospectus.
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Officer's Certificate: A certificate signed by the Chairman of the
Board, any Vice Chairman, the President, any Vice President or any Assistant
Vice President of a Person and, with respect to the Issuer, as defined in the
Indenture.
Operative Agreements: The Trust Agreement, the Certificate of Trust of
the Issuer, this Agreement, the Mortgage Loan Purchase Agreement, the Indenture,
the Administration Agreement, the Yield Maintenance Agreements and each other
document contemplated by any of the foregoing to which the Depositor, the Owner
Trustee, the Administrator, the Indenture Trustee or the Issuer is a party.
Opinion of Counsel: A written opinion of counsel, reasonably acceptable
in form and substance to the Indenture Trustee and the Issuer, and who may be
in-house or outside counsel to the Seller, the Depositor, the Master Servicer,
the Indenture Trustee, the Owner Trustee or the Issuer but which must be
Independent outside counsel with respect to any such opinion of counsel
concerning federal income tax matters.
Outstanding Mortgage Loan: As of any Due Date, a Mortgage Loan with a
Scheduled Principal Balance greater than zero, that was not the subject of a
prepayment in full prior to such Due Date and that did not become a Liquidated
Mortgage Loan prior to such Due Date.
Overcollateralization Amount: With respect to any Payment Date, the
amount by which the Pool Balance for such Payment Date exceeds the aggregate
Note Principal Amount after giving effect to the payment of the Principal
Distribution Amount for such Payment Date.
Overcollateralization Deficiency: With respect to any Payment Date, the
amount, if any, by which (x) the Overcollateralization Target Amount for such
Payment Date exceeds (y) the Overcollateralization Amount for such Payment Date,
calculated for this purpose after giving effect to the reduction on such Payment
Date of the Class Principal Amounts of the Notes resulting from the distribution
of the Principal Distribution Amount (but not the Extra Principal Distribution
Amount) on such Payment Date, but prior to allocation of any Applied Loss Amount
on such Payment Date.
Overcollateralization Target Amount: With respect to any payment date,
an amount equal to 0.25% of the Cut-off Date Balance.
Owner Trustee: Wilmington Trust Company, a Delaware banking
corporation, and any successor in interest, not in its individual capacity, but
solely as owner trustee under the Trust Agreement.
Payahead: With respect to any Mortgage Loan and any Due Date therefor,
any Monthly Payment received by the applicable Servicer during any Due Period in
addition to the Monthly Payment due on such Due Date, intended by the related
Mortgagor to be applied on a subsequent Due Date or Due Dates.
Payment Date: The 25th day of each month or, if such day is not a
Business Day, the next Business Day, commencing in September 2003.
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Payment Date Statement: As defined in Section 5.10(a) hereof.
Percentage Interest: With respect to any Security, the Percentage
Interest evidenced thereby shall equal (1) in the case of a Trust Certificate,
the Percentage Interest on the face of such certificate or (ii) in the case of
any Note, the initial Note Principal Amount thereof divided by the initial Class
Principal Amount of all Notes of the same Class.
Permitted Investments: Any one or more of the following obligations or
securities acquired at a purchase price of not greater than par, regardless of
whether issued or managed by the Depositor, the Master Servicer, the Indenture
Trustee, the Owner Trustee or any of their respective Affiliates or for which an
Affiliate of the Indenture Trustee, the Master Servicer or the Owner Trustee
serves as an advisor:
(i) direct obligations of, or obligations fully
guaranteed as to timely payment of principal and interest by, the
United States or any agency or instrumentality thereof, provided such
obligations are backed by the full faith and credit of the United
States;
(ii) demand and time deposits in, certificates of deposit
of, bankers' acceptances issued by or federal funds sold by any
depository institution or trust company (including the Indenture
Trustee, the Master Servicer or the Owner Trustee or their agents
acting in their respective commercial capacities) incorporated under
the laws of the United States of America or any state thereof and
subject to supervision and examination by federal and/or state
authorities, so long as, at the time of such investment or contractual
commitment providing for such investment, such depository institution
or trust company or its ultimate parent has a short-term uninsured debt
rating in one of the two highest available rating categories of each
Rating Agency and (B) any other demand or time deposit or deposit which
is fully insured by the FDIC;
(iii) repurchase obligations with respect to any security
described in clause (i) above and entered into with a depository
institution or trust company (acting as principal) rated A or higher by
each Rating Agency;
(iv) securities bearing interest or sold at a discount
that are issued by any corporation incorporated under the laws of the
United States of America, the District of Columbia or any State thereof
and that are rated by each Rating Agency in its highest long-term
unsecured rating categories at the time of such investment or
contractual commitment providing for such investment;
(v) commercial paper (including both non-interest-bearing
discount obligations and interest-bearing obligations) that is rated by
each Rating Agency in its highest short-term unsecured debt rating
available at the time of such investment;
(vi) units of money market funds (which may be 12b-1
funds, as contemplated by the Commission under the Investment Company
Act of 1940) registered under the Investment Company Act of 1940
including funds managed or advised by the Indenture Trustee, the Master
Servicer, the Owner Trustee or an affiliate thereof having the highest
applicable rating from each Rating Agency; and
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(vii) if previously confirmed in writing to the Indenture
Trustee, any other demand, money market or time deposit, or any other
obligation, security or investment, as may be acceptable to each Rating
Agency in writing as a permitted investment of funds backing securities
having ratings equivalent to their respective highest initial ratings
of the Class A-1 and Class A-2 Notes;
provided, however, that no instrument described hereunder shall evidence either
the right to receive (a) only interest with respect to the obligations
underlying such instrument or (b) both principal and interest payments derived
from obligations underlying such instrument and the interest and principal
payments with respect to such instrument provide a yield to maturity at par
greater than 120% of the yield to maturity at par of the underlying obligations.
Person: Any individual, corporation, partnership, joint venture,
association, joint-stock company, limited liability company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
Pool Balance: As to any Payment Date, the aggregate of the Scheduled
Principal Balances of the Mortgage Loans that were Outstanding Mortgage Loans on
that day.
Prepayment Interest Shortfall: With respect to any Payment Date and any
full or partial Principal Prepayment of a Mortgage Loan received by a Servicer
in the prior calendar month and not included in the prior remittance, the
excess, if any, of (i) one full month's interest at the applicable Loan Rate (as
reduced by the Servicing Fee or the Master Servicing Fee, as applicable, in the
case of Principal Prepayments in full), on the outstanding principal balance of
such Mortgage Loan immediately prior to such prepayment over (ii) the amount of
interest actually received by the related Servicer with respect to such Mortgage
Loan in connection with such Principal Prepayment.
Prepayment Penalty Amount: With respect to any Mortgage Loan and each
Payment Date, all premiums or charges, if any, paid by Mortgagors under the
related Mortgage Notes as a result of full or partial Principal Prepayments
collected by the applicable Servicer during the immediately preceding Prepayment
Period, but only to the extent required to be remitted to the Master Servicer on
the applicable Servicer Remittance Date under the terms of the related Servicing
Agreement.
Prepayment Period: With respect to any Payment Date, the calendar month
preceding the month in which such Payment Date occurs.
Primary Insurance Policy: Mortgage guaranty insurance, if any, on an
individual Mortgage Loan, as evidenced by a policy or certificate.
Principal Distribution Amount: With respect to any Payment Date, the
sum of (i) the Principal Remittance Amount for such date and (ii) the Extra
Principal Distribution Amount, if any, for such date.
Principal Prepayment: Any payment of principal made by the Mortgagor on
a Mortgage Loan that is received in advance of its scheduled Due Date and that
is not accompanied by an
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amount of interest representing the full amount of scheduled interest due on any
Due Date in any month or months subsequent to the month of prepayment.
Principal Remittance Amount: With respect to any Payment Date and with
respect to all of the Mortgage Loans, (a) the sum of (1) all principal collected
(other than Payaheads) or advanced in respect of Monthly Payments on the
Mortgage Loans during the related Due Period whether by a Servicer or the Master
Servicer (less unreimbursed Advances due to the Master Servicer or any Servicer
with respect to the related Mortgage Loans, to the extent allocable to
principal), (2) all Principal Prepayments in full or in part received (or deemed
by the Master Servicer to have been received) during the related Prepayment
Period on the Mortgage Loans, (3) the portion of any Purchase Price with respect
to any Mortgage Loan that was purchased from the Trust Estate during the related
Prepayment Period allocable to principal, (4) the portion of any Substitution
Adjustment paid with respect to any Deleted Mortgage Loan relating to a Mortgage
Loan during the related Prepayment Period allocable to principal, (5) the
principal portion of any amount paid under the Guaranty Surety Bond, (6) all Net
Liquidation Proceeds, Insurance Proceeds and other recoveries collected with
respect to such Mortgage Loans during the related Prepayment Period, to the
extent allocable to principal, and (7) the portion of any Termination Price
allocable to principal received in connection with an Optional Termination
pursuant to Section 7.03, as reduced by (b) other costs, expenses or liabilities
reimbursable to the Indenture Trustee, the Administrator, the Master Servicer,
the Owner Trustee and each Servicer to the extent provided in the Operative
Agreements and each Servicing Agreement and to the extent not reimbursed thereto
from the Interest Remittance Amount or otherwise.
Proprietary Lease: With respect to any Cooperative Unit, a lease or
occupancy agreement between a Cooperative Corporation and a holder of related
Cooperative Shares.
Prospectus: The prospectus supplement dated August 25, 2003, together
with the accompanying prospectus dated June 23, 2003, relating to the Class X-0,
Xxxxx X-0, Class M-1 and Class M-2 Notes.
Purchase Price: With respect to the purchase of a Mortgage Loan or
related REO Property pursuant to this Agreement, an amount equal to the sum of
(a) 100% of the unpaid principal balance of such Mortgage Loan plus (b) (i) in
the case of a Mortgage Loan, accrued interest thereon at the applicable Loan
Rate, from the date as to which interest was last paid to (but not including)
the Due Date in the Due Period immediately preceding the related Payment Date or
(ii) in the case of an REO Property, the sum of (1) accrued interest at the
applicable Loan Rate from the date as to which interest was last covered by a
payment by the Mortgagor to the Due Date in the related Due Period plus (2) REO
Imputed Interest for such REO Property for each calendar month commencing with
the calendar month in which such REO Property was acquired and ending with the
calendar month in which such purchase is to be effected, net of the total of all
net rental income, Insurance Proceeds and Liquidation Proceeds that as of the
date of purchase had been distributed as or to cover REO Imputed Interest, plus
(c) in each case, any unreimbursed Servicing Advances and fees allocable to such
Mortgage Loan or REO Property, plus (d) in the case of a Mortgage Loan required
to be purchased pursuant to Section 3.03 hereof, expenses reasonably incurred or
to be incurred by the Indenture Trustee in respect of the breach or defect
giving rise to the purchase obligation and plus (e) any cost or damages incurred
by the
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Issuer as a result of any violation of any applicable federal, state or local
predatory or abusive lending law.
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 Xxxxxx
Xxx-approved mortgage insurer and 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 for a
Deleted Mortgage Loan pursuant to the terms of this Agreement which must, on the
date of such substitution, (i) have an outstanding principal balance, after
application of all scheduled payments of principal and interest due during or
prior to the month of substitution, not in excess of, and not more than 5% less
than, the principal balance of the Deleted Mortgage Loan as of the Due Date in
the calendar month during which the substitution occurs, (ii) have a maximum
loan rate not less than the Maximum Loan Rate of the Deleted Mortgage Loan,
(iii) have a gross margin equal to or greater than the Gross Margin of the
Deleted Mortgage Loan, (iv) have the same Index as the Deleted Mortgage Loan,
(v) have its next adjustment date not more than two months after the next
Adjustment Date of the Deleted Mortgage Loan, (vi) have a remaining term to
maturity not greater than (and not more than one year less than) that of the
Deleted Mortgage Loan, (vii) be current as of the date of substitution, (viii)
have a Loan-to-Value Ratio and a Loan-to-Collateral Value Ratio as of the date
of substitution equal to or lower than the Loan-to-Value Ratio and the
Loan-to-Collateral Value Ratio, respectively, of the Deleted Mortgage Loan as of
such date, (ix) have been underwritten or re-underwritten in accordance with the
same or substantially similar underwriting criteria and guidelines as the
Deleted Mortgage Loan, (x) is of the same or better credit quality as the
Deleted Mortgage Loan and (xi) conform to each representation and warranty set
forth in Section 3.04 hereof applicable to the Deleted Mortgage Loan. In the
event that one or more mortgage loans are substituted for one or more Deleted
Mortgage Loans, the amounts described in clause (i) hereof shall be determined
on the basis of aggregate principal balances, the terms described in clause (vi)
hereof shall be determined on the basis of weighted average remaining term to
maturity, the Loan-to-Value Ratio and Loan-to-Collateral Value Ratio described
in clause (viii) hereof shall be satisfied as to each such mortgage loan and,
except to the extent otherwise provided in this sentence, the representations
and warranties described in clause (x) hereof must be satisfied as to each
Qualified Substitute Mortgage Loan or in the aggregate, as the case may be.
Rating Agency: Each of Xxxxx'x and/or S&P.
Realized Loss: With respect to any Liquidated Mortgage Loan, the
portion of the principal balance remaining unpaid after application of all Net
Liquidation Proceeds in respect of such Liquidated Mortgage Loan.
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Recognition Agreement: With respect to any Cooperative Loan, an
agreement between the related Cooperative Corporation and the originator of such
Mortgage Loan to establish the rights of such originator in the related
Cooperative Property.
Record Date: With respect to the Notes and any Payment Date, the close
of business on the Business Day immediately preceding such Payment Date. With
respect to the Trust Certificates and any Payment Date, the last Business Day of
the month immediately preceding the month in which the Payment Date occurs (or,
in the case of the first Payment Date, the Closing Date).
Redemption Price: As defined in the Indenture.
Reference Bank Rate: With respect to any Payment Date, the arithmetic
mean, rounded upwards, if necessary, to the nearest whole multiple of 0.03125%,
of the offered rates for United States dollar deposits for one month that are
quoted by the Reference Banks as of 11:00 a.m., New York City time, on the
related LIBOR Determination Date to prime banks in the London interbank market
for a period of one month in amounts approximately equal to the sum of the Class
Principal Amounts of the Notes for such Accrual Period.
Reference Banks: With respect to any Payment Date, leading banks
selected by the Master Servicer that are engaged in transactions in Eurodollar
deposits in the international Eurocurrency market with an established place of
business in London and which are not controlling, controlled by, or under common
control with, the Depositor, the Seller or the Master Servicer.
Refinancing Mortgage Loan: Any Mortgage Loan originated in connection
with the refinancing of an existing mortgage loan.
Relevant UCC: The Uniform Commercial Code as in effect in the
applicable jurisdiction.
Relief Act: The Soldiers' and Sailors' Civil Relief Act of 1940, as
amended, or similar state laws.
Relief Act Reductions: With respect to any Payment Date and any
Mortgage Loan as to which there has been a reduction in the amount of interest
collectible thereon for the most recently ended Due Period as a result of the
application of the Relief Act, the amount, if any, by which (i) interest
collectible on that Mortgage Loan during such Due Period is less than (ii) one
month's interest on the Scheduled Principal Balance of such Mortgage Loan at the
Loan Rate for such Mortgage Loan before giving effect to the application of the
Relief Act.
REO Disposition: The sale or other disposition of an REO Property on
behalf of the Issuer.
REO Imputed Interest: As to any REO Property, for any calendar month
during which such REO Property was at any time part of the Trust Estate, one
month's interest at the applicable Net Loan Rate on the principal balance of
such REO Property (or, in the case of the
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first such calendar month, of the related Mortgage Loan if appropriate) as of
the close of business on the Due Date in such calendar month.
REO Property: A Mortgaged Property acquired by the Master Servicer or
the applicable Servicer through foreclosure or deed-in-lieu of foreclosure in
accordance with the applicable provisions of the related Servicing Agreement.
Residential Dwelling: Any one of the following: (i) a detached
one-family dwelling, (ii) a detached two- to four-family dwelling, (iii) a
one-family dwelling unit in a condominium project, (iv) a manufactured home, (v)
a cooperative unit or (vi) a detached one-family dwelling in a planned unit
development, none of which is a mobile home.
Responsible Officer: Any vice president, any assistant vice president,
any associate, any corporate trust officer or any other officer of the Indenture
Trustee customarily performing functions similar to those performed by any of
the above-designated officers and, in each case, having direct responsibility
for the administration of the Operative Agreements and also, with respect to a
particular matter, any other officer to whom such matter is referred because of
such officer's knowledge of and familiarity with the particular subject.
Retained Interest: As to any Employee Loans originated by Xxxxxxxxx and
each Payment Date, interest accrued on the principal balance thereof at the
Retained Rate.
Retained Interest Holder: With respect to each Employee Loan, the
Seller or any successor in interest by assignment or otherwise.
Retained Rate: As of the Cut-off Date, and for each Due Period
thereafter, 0.00% per annum; provided, however, if the related Mortgagor of the
Employee Loan ceases to be an employee or a director of Xxxxxxxxx or its
Affiliates, the amount of the increase in the per annum rate set forth in the
related Mortgage Note.
S&P: Standard & Poor's Ratings Services, a division of The XxXxxx-Xxxx
Companies, Inc., or any successor in interest.
Scheduled Principal Balance: With respect to (i) any Mortgage Loan as
of any Payment Date, the principal balance of such Mortgage Loan at the close of
business on the Cut-off Date, after giving effect to principal payments due on
or before the Cut-off Date, whether or not received, less an amount equal to
principal payments due after the Cut-off Date and on or before the Due Date in
the related Due Period, whether or not received from the Mortgagor or advanced
by any Servicer or the Master Servicer, and all amounts allocable to unscheduled
principal payments (including Principal Prepayments, Liquidation Proceeds,
Insurance Proceeds and condemnation proceeds, in each case to the extent
identified and applied prior to or during the related Prepayment Period) and
(ii) any REO Property as of any Payment Date, the Scheduled Principal Balance of
the related Mortgage Loan on the Due Date immediately preceding the date of
acquisition of such REO Property by or on behalf of the Indenture Trustee
(reduced by any amount applied as a reduction of principal on the Mortgage
Loan). Any Liquidated Mortgage Loan will have a Scheduled Principal Balance
equal to zero. As of the Cut-off Date, the Mortgage Loans had an aggregate
Scheduled Principal Balance of $1,395,936,057.12.
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Securities: Any Note or Trust Certificate.
Securities Intermediary: The Person acting as Securities Intermediary
under this Agreement (which is Deutsche Bank National Trust Company), its
successor in interest, and any successor Securities Intermediary appointed
pursuant to Section 5.09.
Security Agreement: With respect to any Cooperative Loan, the agreement
between the owner of the related Cooperative Shares and the originator of the
related Mortgage Note that defines the terms of the security interest in such
Cooperative Shares and the related Proprietary Lease.
Security Entitlement: The meaning specified in Section 8-102(a)(17) of
the New York UCC.
Securityholders: The Noteholders and the Certificateholders.
Seller: Xxxxxxxxx.
Senior Note: Any Class A-1 or Class A-2 Note.
Servicer Remittance Date: With respect to each Mortgage Loan, the 18th
day of each month, or the next Business Day if such 18th day is not a Business
Day.
Servicers: The servicers listed on Exhibit D or any successors in
interest.
Servicing Account: Any account established and maintained for the
benefit of the Master Servicer or the Indenture Trustee by a Servicer with
respect to the related Mortgage Loans and any REO Property, pursuant to the
terms of the respective Servicing Agreement.
Servicing Advances: With respect to any Servicer or the Master
Servicer, all customary, reasonable and necessary "out of pocket" costs and
expenses (including reasonable attorneys' fees and expenses) incurred by any
Servicer or the Master Servicer in the performance of its servicing obligations
hereunder, including, but not limited to, the cost of (i) the preservation,
restoration, inspection and protection of the Mortgaged Property, (ii) any
enforcement or judicial proceedings, including foreclosures, (iii) the
management and liquidation of the REO Property and (iv) compliance with the
obligations under Article IV hereof or the related Servicing Agreements.
Servicing Agreement: Each Servicing Agreement listed on Exhibit C and
any other servicing agreement entered into between a successor servicer and the
Seller or Issuer pursuant to the terms of this Agreement.
Servicing Fee: As to any Payment Date and each Mortgage Loan, an amount
equal to the product of (a) one-twelfth of the Servicing Fee Rate and (b) the
Scheduled Principal Balance of such Mortgage Loan as of the first day of the
related Due Period.
Servicing Fee Rate: With respect to each Mortgage Loan, the rate
specified in the related Servicing Agreement and as set forth on the Mortgage
Loan Schedule.
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Servicing Officer: Any officer of a Servicer or the Master Servicer
involved in or responsible for the administration and servicing or master
servicing of the Mortgage Loans whose name appears on a list of servicing
officers furnished by such Servicer or the Master Servicer to the Indenture
Trustee, as such list may from time to time be amended.
Seven-Year Hybrid Mortgage Loans: The Mortgage Loans set forth on
Schedule E hereto.
Significant Modification: As defined in Section 4.18(b).
Significant Modification Loan: As defined in Section 4.18(b).
Subordinate Note: Any Class M-1 or Class M-2 Note.
Substitution Adjustment: As defined in Section 3.03(d) hereof.
Surety: Ambac Assurance Corporation (formerly known as AMBAC Indemnity
Corporation), or any successor thereto, as issuer of the Guaranty Surety Bond.
Telerate Page 3750: The display currently so designated as "Page 3750"
on the Bridge Telerate Service (or such other page selected by the Master
Servicer as may replace Page 3750 on that service for the purpose of displaying
daily comparable rates on prices).
Ten-Year Hybrid Mortgage Loans: The Mortgage Loans set forth on
Schedule F hereto.
Xxxxxxxxx: Xxxxxxxxx Mortgage Home Loans, Inc., a Delaware corporation,
and its successors and assigns.
Title Insurance Policy: A title insurance policy maintained with
respect to a Mortgage Loan.
TMI: Xxxxxxxxx Mortgage Inc., a Maryland corporation, and its
successors and assigns.
Trust Account Property: The Trust Accounts, the Certificate Account,
all amounts and investments held from time to time in the Trust Accounts, the
Certificate Account (whether in the form of deposit accounts, physical property,
book-entry securities, uncertificated securities, securities entitlements,
investment property or otherwise) and all proceeds of the foregoing.
Trust Accounts: The Note Account and the Yield Maintenance Account.
Trust Agreement: The trust agreement dated as of August 1, 2003,
between the Depositor, the Administrator and the Owner Trustee, as such may be
amended or supplemented from time to time.
Trust Certificate: Any Trust Certificate evidencing the ownership
interest in the Issuer, substantially in the form attached as Exhibit A of the
Trust Agreement.
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Trust Estate: The assets subject to this Agreement and the Indenture,
transferred by the Depositor to the Issuer and pledged by the Issuer to the
Indenture Trustee, which assets consist of all accounts, accounts receivable,
contract rights, general intangibles, chattel paper, instruments, documents,
money, deposit accounts, certificates of deposit, goods, notes, drafts, letters
of credit, advices of credit, investment property, uncertificated securities and
rights to payment of any and every kind consisting of, arising from or relating
to any of the following: (a) the Mortgage Loans listed in the Mortgage Loan
Schedule and principal due and payable after the Cut-off Date (including
Prepayment Penalty Amounts), but not including interest and principal due and
payable on any Mortgage Loans on or before the Cut-off Date (but excluding any
Retained Interest), together with the Mortgage Files relating to such Mortgage
Loans; (b) any Insurance Proceeds, REO Property, Liquidation Proceeds and other
recoveries (in each case, subject to clause (a) above), (c) the Collection
Account, the Note Account, any Servicing Account, any Escrow Account, the Yield
Maintenance Account and all amounts deposited therein pursuant to the applicable
provisions of this Agreement, (d) any Insurance Policies, (e) the rights of the
Depositor under the Mortgage Loan Purchase Agreement, (f) Depositor's security
interest in the Additional Collateral, (g) the Guaranty Surety Bond with respect
to the Additional Collateral Mortgage Loans conveyed to the Seller from MSDWCC,
(h) the rights of the Seller under each Servicing Agreement with respect to the
Mortgage Loans and (i) all income, revenues, issues, products, revisions,
substitutions, replacements, profits, rents and all cash and non-cash proceeds
of the foregoing.
UCC: The Uniform Commercial Code as enacted in the relevant
jurisdiction.
Underwriters: Greenwich Capital Markets, Inc., Bear, Xxxxxxx & Co. Inc.
and Xxxxxx Brothers Inc.
Uniform Commercial Code: The Uniform Commercial Code as in effect in
any applicable jurisdiction from time to time.
Uninsured Cause: Any cause of damage to a Mortgaged Property such that
the complete restoration of such property is not fully reimbursable by the
hazard insurance policies required to be maintained on such Mortgaged Property.
Value: With respect to any Mortgage Loan and the related Mortgaged
Property, the lesser of:
(i) the value of such Mortgaged Property as determined by
an appraisal made for the originator of the Mortgage Loan at the time
of origination of the Mortgage Loan by an appraiser who met the minimum
requirements of Xxxxxx Mae and Xxxxxxx Mac; and
(ii) the purchase price paid for the related Mortgaged
Property by the Mortgagor with the proceeds of the Mortgage Loan;
provided, however, that in the case of a Refinancing Mortgage Loan, such value
of the Mortgaged Property is based solely upon the value determined by an
appraisal made for the originator of such Refinancing Mortgage Loan at the time
of origination by an appraiser who met the minimum requirements of Xxxxxx Mae
and Xxxxxxx Mac.
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Weighted Average Cap Strike Rate: With respect to any Payment Date will
be the weighted average of (1) with respect to the Five-Year Hybrid Mortgage
Loans, the strike price under the related Yield Maintenance Agreement, (2) with
respect to the Seven-Year Hybrid Mortgage Loans, the strike price under the
related Yield Maintenance Agreement, (3) with respect to the Ten-Year Hybrid
Mortgage Loans, the strike price under the related Yield Maintenance Agreement
and (4) with respect to all other Mortgage Loans, 10.25% per annum, weighted on
the basis of with respect to clauses (1), (2) and (3), the related notional
amount for such payment date as specified in the related Yield Maintenance
Agreement and with respect to clause (4), the Scheduled Principal Balances of
the related Mortgage Loans as of the first day of the related Due Period.
Yield Maintenance Account: The account maintained by the Indenture
Trustee pursuant to Section 5.05 which shall be entitled "Yield Maintenance
Account, Deutsche Bank National Trust Company, as Indenture Trustee, in trust
for the registered Holders of Xxxxxxxxx Mortgage Securities Trust 2003-4,
Mortgage-Backed Securities, Series 2003-4" and which must be an Eligible
Account.
Yield Maintenance Agreements: The three agreements dated August 27,
2003, by and between the Yield Maintenance Provider and the Issuer, Ref. Nos.
FXTMS0341, XXXXX0000 and FXTMS0343, the schedule thereto and the related
confirmation.
Yield Maintenance Payment: For each Yield Maintenance Agreement and a
Payment Date, the amount, if any, to be paid pursuant to such Yield Maintenance
Agreement, as calculated by the Yield Maintenance Provider based on information
in the Payment Date Statement delivered to it pursuant to Section 5.10 on the
Business Day prior to the immediately preceding Payment Date.
Yield Maintenance Provider: Bear Xxxxxxx Financial Products Inc.
Section 1.02 Calculations Respecting Mortgage Loans.
Calculations required to be made pursuant to this Agreement with
respect to any Mortgage Loan in the Trust Estate shall be made based upon
current information as to the terms of the Mortgage Loans and reports of
payments received from the Mortgagor on such Mortgage Loans and payments to be
made to the Indenture Trustee as supplied to the Indenture Trustee by the Master
Servicer. The Indenture Trustee shall not be required to recompute, verify or
recalculate the information supplied to it by the Master Servicer or any
Servicer.
Section 1.03 Calculations Respecting Accrued Interest.
Accrued interest, if any, on any Note shall be calculated based upon a
360-day year consisting of twelve 30-day months.
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ARTICLE II
CONVEYANCE OF MORTGAGE LOANS
Section 2.01 Conveyance of Mortgage Loans.
(a) In consideration of the Issuer's delivery of the Notes and the
Trust Certificate to the Depositor or its designee, and concurrently with the
execution and delivery of this Agreement, the Depositor does hereby transfer,
assign, set over, deposit with and otherwise convey to the Issuer, without
recourse, subject to Sections 2.02, 2.03, 3.03 and 3.04, in trust, all the
right, title and interest of the Depositor in and to the Trust Estate. The
Indenture Trustee declares that, subject to the review provided for in Section
2.02, it has received and shall hold the Trust Estate, as Indenture Trustee, in
trust, for the benefit and use of the Securityholders and for the purposes and
subject to the terms and conditions set forth in this Agreement and the
Indenture. Concurrently with such receipt, the Issuer has issued and delivered
the Securities to or upon the order of the Depositor, in exchange for the Trust
Estate.
Upon the issuance of the Securities, ownership in the Trust Estate
shall be vested in the Issuer, subject to the lien created by the Indenture in
favor of the Indenture Trustee, for the benefit of the Securityholders. The
foregoing sale, transfer, assignment, set-over, deposit and conveyance does not
and is not intended to result in creation or assumption by the Indenture Trustee
of any obligation of the Depositor, the Seller, or any other Person in
connection with the Mortgage Loans or any other agreement or instrument relating
thereto except as specifically set forth herein.
In addition, with respect to any Additional Collateral Mortgage Loan,
the Depositor does hereby transfer, assign, set-over and otherwise convey to the
Issuer without recourse (except as provided herein) (i) its rights as assignee
under any security agreements, pledge agreements or guarantees relating to the
Additional Collateral supporting any Additional Collateral Mortgage Loan, (ii)
its security interest in and to any Additional Collateral, (iii) its right to
receive payments in respect of any Additional Collateral Mortgage Loan pursuant
to the related Servicing Agreement and (iv) its rights as beneficiary under the
Guaranty Surety Bond related in respect of any Additional Collateral Mortgage
Loans conveyed to the Seller from MSDWCC.
In connection with such transfer and assignment, the Seller, on behalf
of the Depositor, does hereby deliver on the Closing Date, unless otherwise
specified in this Section 2.01, to, and deposit with the Indenture Trustee, or
the Custodian as its designated agent, the following documents or instruments
with respect to each Mortgage Loan (a "Mortgage File") so transferred and
assigned:
(i) the original Mortgage Note, endorsed (other than for a MOM
Loan) either on its face or by allonge attached thereto in
blank or in the following form: "Pay to the order of Deutsche
Bank National Trust Company, as Indenture Trustee for
Xxxxxxxxx Mortgage Securities Trust 2003-4, without recourse",
or with respect to any lost Mortgage Note, an original Lost
Note Affidavit stating that the original mortgage note was
lost, misplaced or destroyed, together with a copy of the
related mortgage note; provided, however, that such
substitutions of Lost Note
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Affidavits for original Mortgage Notes may occur only with
respect to Mortgage Loans the aggregate related Cut-Off Date
Balance of which is less than or equal to 2% of the Cut-Off
Date Balance;
(ii) the original of any guarantee, security agreement or pledge
agreement relating to any Additional Collateral, if
applicable, and executed in connection with the Mortgage Note,
assigned to the Indenture Trustee on behalf of the Issuer;
(iii) except as provided below, for each Mortgage Loan that is not a
MERS Mortgage Loan, the original Mortgage, and in the case of
each MERS Mortgage Loan, the original Mortgage, noting the
presence of the MIN for that Mortgage Loan and either language
indicating that the Mortgage Loan is a MOM Loan if the
Mortgage Loan is a MOM Loan, or if such Mortgage Loan was not
a MOM Loan at origination, the original Mortgage and the
assignment to MERS, in each case with evidence of recording
thereon, and the original recorded power of attorney, if the
Mortgage was executed pursuant to a power of attorney, with
evidence of recording thereon or, if such Mortgage or power of
attorney has been submitted for recording but has not been
returned from the applicable public recording office, has been
lost or is not otherwise available, a copy of such Mortgage or
power of attorney, as the case may be, together with an
Officer's Certificate of the Seller certifying that the copy
of such Mortgage delivered to the Indenture Trustee (or its
Custodian) is a true copy and that the original of such
Mortgage has been forwarded to the public recording office,
or, in the case of a Mortgage that has been lost, a copy
thereof (certified as provided for under the laws of the
appropriate jurisdiction) and a written Opinion of Counsel
(delivered at the Seller's expense) acceptable to the
Indenture Trustee and the Depositor that an original recorded
Mortgage is not required to enforce the Indenture Trustee's
interest in the Mortgage Loan;
(iv) the original of each assumption, modification or substitution
agreement, if any, relating to the Mortgage Loans, or, as to
any assumption, modification or substitution agreement which
cannot be delivered on or prior to the Closing Date because of
a delay caused by the public recording office where such
assumption, modification or substitution agreement has been
delivered for recordation, a photocopy of such assumption,
modification or substitution agreement, pending delivery of
the original thereof, together with an Officer's Certificate
of the Seller certifying that the copy of such assumption,
modification or substitution agreement delivered to the
Indenture Trustee (or its custodian) on behalf of the Issuer
is a true copy and that the original of such agreement has
been forwarded to the public recording office;
(v) in the case of each Mortgage Loan that is not a MERS Mortgage
Loan, an original Assignment of Mortgage, in form and
substance acceptable for recording. The Mortgage shall be
assigned to "Deutsche Bank National Trust Company, as
Indenture Trustee for Xxxxxxxxx Mortgage Securities Trust
2003-4, without recourse";
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(vi) in the case of each Mortgage Loan that is not a MERS Mortgage
Loan, an original copy of any intervening Assignment of
Mortgage showing a complete chain of assignments, or, in the
case of an intervening Assignment of Mortgage that has been
lost, a written Opinion of Counsel (delivered at the Seller's
expense) acceptable to the Indenture Trustee that such
original intervening Assignment of Mortgage is not required to
enforce the Indenture Trustee's interest in the Mortgage
Loans;
(vii) the original Primary Insurance Policy, if any, or certificate,
if any;
(viii) the original or a certified copy of lender's title insurance
policy;
(ix) the original or copies of each assumption, modification,
written assurance or substitution agreement, if any; and
(x) with respect to any Cooperative Loan, the Cooperative Loan
Documents.
In connection with the assignment of any MERS Mortgage Loan, the Seller
agrees that it will take (or shall cause the applicable Servicer to take), at
the expense of the Seller (with the cooperation of the Depositor, the Issuer,
the Indenture Trustee and the Master Servicer), such actions as are necessary to
cause the MERS(R) System to indicate that such Mortgage Loans have been assigned
by the Seller to the Indenture Trustee in accordance with this Agreement and the
Indenture for the benefit of the Securityholders by including (or deleting, in
the case of Mortgage Loans that are repurchased in accordance with this
Agreement) in such computer files the information required by the MERS(R) System
to identify the series of the Notes issued in connection with the transfer of
such Mortgage Loans to the Xxxxxxxxx Mortgage Securities Trust 2003-4.
With respect to each Cooperative Loan, the Seller, on behalf of the
Depositor does hereby deliver to the Indenture Trustee the related Cooperative
Loan Documents and the Seller will take (or shall cause the applicable Servicer
to take), at the expense of the Seller (with the cooperation of the Depositor,
the Indenture Trustee and the Master Servicer) such actions as are necessary
under applicable law (including but not limited to the relevant UCC) in order to
perfect the interest of the Indenture Trustee in the related Mortgaged Property.
Assignments of each Mortgage with respect to each Mortgage Loan that is
not a MERS Mortgage Loan (other than a Cooperative Loan) shall be recorded;
provided, however, that such assignments need not be recorded if, in the Opinion
of Counsel (which must be from Independent Counsel and not at the expense of the
Issuer or the Indenture Trustee) acceptable to the Indenture Trustee, the Rating
Agencies and the Master Servicer, recording in such states is not required to
protect the Indenture Trustee's interest in the related Mortgage Loans;
provided, however, notwithstanding the delivery of any Opinion of Counsel, each
Assignment of Mortgage shall be submitted for recording by the Seller (or the
Seller will cause the applicable Servicer to submit each such assignment for
recording), at the cost and expense of the Seller, in the manner described
above, at no expense to the Issuer or Indenture Trustee, upon the earliest to
occur of (1) the occurrence of a bankruptcy or insolvency relating to the Seller
or the Depositor, or (2) with respect to any one Assignment of Mortgage, the
occurrence of a bankruptcy, insolvency or
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foreclosure relating to the Mortgagor under the related Mortgage. Subject to the
preceding sentence, as soon as practicable after the Closing Date (but in no
event more than three months thereafter except to the extent delays are caused
by the applicable recording office), the Seller shall properly record (or the
Seller will cause the applicable Servicer to properly record), at the expense of
the Seller (with the cooperation of the Depositor, the Indenture Trustee, the
Issuer and the Master Servicer), in each public recording office where the
related Mortgages are recorded, each assignment referred to in Section 2.01(v)
above with respect to a Mortgage Loan that is not a MERS Mortgage Loan.
The Indenture Trustee agrees to execute and deliver to the Depositor on
or prior to the Closing Date an acknowledgment of receipt of the original
Mortgage Note (with any exceptions noted), substantially in the form attached as
Exhibit A-1 hereto, which may provide for exceptions for Delayed Delivery
Mortgage Loans.
If the original lender's title insurance policy, or a certified copy
thereof, was not delivered pursuant to Section 2.01(viii) above, the Seller
shall deliver or cause to be delivered to the Indenture Trustee the original or
a copy of a written commitment or interim binder or preliminary report of title
issued by the title insurance or escrow company, with the original or a
certified copy thereof to be delivered to the Indenture Trustee, promptly upon
receipt thereof, but in any case within 175 days of the Closing Date. The Seller
shall deliver or cause to be delivered to the Indenture Trustee, promptly upon
receipt thereof, any other documents constituting a part of a Mortgage File
received with respect to any Mortgage Loan sold to the Depositor by the Seller,
including, but not limited to, any original documents evidencing an assumption
or modification of any Mortgage Loan.
For Mortgage Loans (if any) that have been prepaid in full after the
Cut-off Date and prior to the Closing Date, the Seller, in lieu of delivering
the above documents, herewith delivers to the Indenture Trustee, or to the
Custodian on behalf of the Indenture Trustee, an Officer's Certificate which
shall include a statement to the effect that all amounts received in connection
with such prepayment that are required to be deposited in the Collection Account
have been so deposited. All original documents that are not delivered to the
Indenture Trustee on behalf of the Issuer shall be held by the Master Servicer
or the applicable Servicer in trust for the Indenture Trustee, for the benefit
of the Issuer and the Securityholders.
Upon discovery or receipt of notice of any materially defective
document in, or that a document is missing from, a Mortgage File, the Seller
shall have 90 days to cure such defect or deliver such missing document to the
Indenture Trustee. If the Seller does not cure such defect or deliver such
missing document within such time period, the Seller shall either repurchase or
substitute for such Mortgage Loan in accordance with Section 3.03 hereof.
Section 2.02 Acceptance of Trust Estate; Review of Documentation.
(a) Subject to the provisions of Section 2.01, the Owner Trustee, on
behalf of the Issuer, acknowledges receipt of the assets transferred by the
Depositor and included in the Trust Estate and has directed that the documents
referred to in Section 2.01 and all other assets included in the definition of
"Trust Estate" be delivered to the Indenture Trustee (or the Custodian) on its
behalf.
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The Indenture Trustee hereby accepts its appointment as Custodian
hereunder and acknowledges the receipt, subject to the provisions of Section
2.01 and subject to the review described below and any exceptions noted on the
exception report described in the next paragraph below, of the documents
referred to in Section 2.01 above and all other assets included in the
definition of "Trust Estate" and declares that, in its capacity as Custodian, it
holds and will hold such documents and the other documents delivered to it
constituting a Mortgage File, and that it holds or will hold all such assets and
such other assets included in the definition of "Trust Estate" in trust for the
exclusive use and benefit of all present and future Securityholders.
The Indenture Trustee further agrees, for the benefit of the
Securityholders, to review each Mortgage File delivered to it and to certify and
deliver to the Depositor, the Issuer, the Seller and each Rating Agency an
interim certification in substantially the form attached hereto as Exhibit A-2,
within 90 days after the Closing Date (or, with respect to any document
delivered after the Startup Day, within 45 days of receipt and with respect to
any Qualified Substitute Mortgage, within five Business Days after the
assignment thereof) that, as to each Mortgage Loan listed in the Mortgage Loan
Schedule (other than any Mortgage Loan paid in full or any Mortgage Loan
specifically identified in the exception report annexed thereto as not being
covered by such certification), (i) all documents required to be reviewed by it
pursuant to Section 2.01 of this Agreement are in its possession, (ii) such
documents have been reviewed by it and have not been mutilated, damaged or torn
and relate to such Mortgage Loan and (iii) based on its examination and only as
to the foregoing, the information set forth in the Mortgage Loan Schedule that
corresponds to items (i), (ii), (iii), (xiii), (xiv) and (xviii) of the Mortgage
Loan Schedule accurately reflects information set forth in the Mortgage File. It
is herein acknowledged that, in conducting such review, the Indenture Trustee is
under no duty or obligation to inspect, review or examine any such documents,
instruments, certificates or other papers to determine that they are genuine,
valid, enforceable, sufficient, nor shall the Indenture Trustee have any
responsibility to determine the perfection or priority of any instrument
appropriate for the represented purpose or that they have actually been
recorded, are in recordable form sufficient to be recorded, or that they are
other than what they purport to be on their face.
No later than 180 days after the Closing Date, the Indenture Trustee
shall deliver to the Depositor, the Issuer and the Seller a final certification
in the form annexed hereto as Exhibit A-3 evidencing the completeness of the
Mortgage Files, with any applicable exceptions noted thereon.
If, in the process of reviewing the Mortgage Files and making or
preparing, as the case may be, the certifications referred to above, the
Indenture Trustee finds any document or documents constituting a part of a
Mortgage File to be missing or not conforming to the requirements as
specifically set forth herein, at the conclusion of its review the Indenture
Trustee (or the Custodian as its designated agent) shall promptly notify the
Seller, the Depositor, the Issuer and the Master Servicer. In addition, upon the
discovery by the Seller or the Depositor (or upon receipt by the Indenture
Trustee of written notification of such breach) of a breach of any of the
representations and warranties made by the Seller in the Mortgage Loan Purchase
Agreement in respect of any Mortgage Loan that materially adversely affects such
Mortgage
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Loan or the interests of the related Securityholders in such Mortgage Loan, the
party discovering such breach shall give prompt written notice to the other
parties to this Agreement.
Nothing in this Agreement shall be construed to constitute an
assumption by the Trust Estate, the Indenture Trustee, any Custodian or the
Noteholders of any unsatisfied duty, claim or other liability on any Mortgage
Loan or to any Mortgagor.
Upon execution of this Agreement, the Depositor hereby delivers to the
Indenture Trustee and the Indenture Trustee acknowledges a receipt of the
Mortgage Loan Purchase Agreement and each Servicing Agreement.
Section 2.03 Grant Clause.
(a) It is intended that the conveyance by the Depositor to the Issuer
of the Mortgage Loans and other assets in the Trust Estate, as provided for in
Section 2.01 be construed as a sale by the Depositor to the Issuer of the
Mortgage Loans and other assets in the Trust Estate for the benefit of the
Securityholders. Further, it is not intended that any such conveyance be deemed
to be a pledge of the Mortgage Loans and other assets in the Trust Estate by the
Depositor to the Issuer to secure a debt or other obligation of the Depositor.
However, in the event that the Mortgage Loans and other assets in the Trust
Estate are held to be property of the Depositor or if for any reason this
Agreement is held or deemed to create a security interest in the Mortgage Loans
and other assets in the Trust Estate, then it is intended that (a) this
Agreement shall also be deemed to be a security agreement within the meaning of
Articles 8 and 9 of the New York UCC (or the Relevant UCC if not the New York
UCC); (b) the conveyances provided for in Section 2.01 shall be deemed to be (1)
a grant by the Depositor to the Issuer of a security interest in all of the
Depositor's right (including the power to convey title thereto), title and
interest, whether now owned or hereafter acquired, in and to (A) the Mortgage
Loans, including the Mortgage Notes, the Mortgages, any related insurance
policies and all other documents in the related Mortgage Files, (B) all amounts
payable pursuant to the Mortgage Loans in accordance with the terms thereof and
(C) any and all general intangibles consisting of, arising from or relating to
any of the foregoing, and all proceeds of the conversion, voluntary or
involuntary, of the foregoing into cash, instruments, securities or other
property, including without limitation all Liquidation Proceeds, all Insurance
Proceeds, all amounts from time to time held or invested in the Collection
Account, the Certificate Account, the Note Account, whether in the form of cash,
instruments, securities or other property and (2) an assignment by the Depositor
to the Issuer of any security interest in any and all of the Depositor's right
(including the power to convey title thereto), title and interest, whether now
owned or hereafter acquired, in and to the property described in the foregoing
clauses (1)(A) through (C); (c) the possession by the Indenture Trustee or any
other agent of the Issuer of Mortgage Notes, and such other items of property as
constitute instruments, money, negotiable documents or chattel paper shall be
deemed to be "possession by the secured party," or possession by a purchaser or
a person designated by such secured party, for purposes of perfecting the
security interest pursuant to the New York UCC and any other Relevant UCC
(including, without limitation, Section 9-313, 8-313 or 8-321 thereof); and (d)
notifications to persons holding such property, and acknowledgments, receipts or
confirmations from persons holding such property, shall be deemed notifications
to, or
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acknowledgments, receipts or confirmations from, financial intermediaries,
bailees or agents (as applicable) of the Issuer for the purpose of perfecting
such security interest under applicable law.
(b) The Depositor and, at the Depositor's direction, the Seller and the
Issuer shall, to the extent consistent with this Agreement, take such reasonable
actions as may be necessary to ensure that, if this Agreement were deemed to
create a security interest in the Mortgage Loans and the other property of the
Trust Estate, such security interest would be deemed to be a perfected security
interest of first priority under applicable law and will be maintained as such
throughout the term of this Agreement. Without limiting the generality of the
foregoing, the Depositor shall prepare and deliver to the Issuer, and the Issuer
shall forward for filing, or shall cause to be forwarded for filing, at the
expense of the Depositor, all filings necessary to maintain the effectiveness of
any original filings necessary under the Relevant UCC to perfect the Issuer's
security interest in or lien on the Mortgage Loans as evidenced by an Officer's
Certificate of the Depositor, including without limitation (x) continuation
statements, and (y) such other statements as may be occasioned by (1) any change
of name of the Seller, the Depositor or the Issuer, (2) any change of location
of the place of business or the chief executive office of the Seller or the
Depositor or (3) any transfer of any interest of the Seller or the Depositor in
any Mortgage Loan.
(c) Neither the Depositor nor the Issuer shall organize under the law
of any jurisdiction other than the State under which each is organized as of the
Closing Date (whether changing its jurisdiction of organization or organizing
under an additional jurisdiction) without giving 30 days prior written notice of
such action to its immediate transferee, including the Indenture Trustee. Before
effecting such change, each of the Depositor or the Issuer proposing to change
its jurisdiction of organization shall prepare and file in the appropriate
filing office any financing statements or other statements necessary to continue
the perfection of the interests of its immediate transferees, including the
Indenture Trustee, in the Mortgage Loans. In connection with the transactions
contemplated by this Agreement and the Indenture, each of the Depositor and the
Issuer authorizes its immediate transferee, including the Indenture Trustee, to
file in any filing office any initial financing statements, any amendments to
financing statements, any continuation statements, or any other statements or
filings described in this Section 2.03(b).
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.01 Representations and Warranties of the Depositor.
The Depositor hereby represents and warrants to the Master Servicer,
the Issuer, the Owner Trustee and the Indenture Trustee, for the benefit of
Securityholders, as follows:
(i) this Agreement constitutes a legal, valid and binding
obligation of the Depositor, enforceable against the Depositor in
accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect affecting the enforcement of
creditors' rights in general an except as such enforceability may be
limited by general principles of equity (whether considered in a
proceeding at law or in equity);
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(ii) immediately prior to the sale and assignment by the
Depositor to the Issuer of each Mortgage Loan, the Depositor had good
and marketable title to each Mortgage Loan (insofar as such title was
conveyed to it by the Seller) subject to no prior lien, claim,
participation interest, mortgage, security interest, pledge, charge or
other encumbrance or other interest of any nature;
(iii) as of the Closing Date, the Depositor has transferred
all right, title and interest in the Mortgage Loans to the Indenture
Trustee on behalf of the Issuer;
(iv) the Depositor has not transferred the Mortgage Loans
to the Indenture Trustee on behalf of the Issuer with any intent to
hinder, delay or defraud any of its creditors;
(v) the Depositor has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
Delaware, with full corporate power and authority to own its assets and
conduct its business as presently being conducted;
(vi) the Depositor is not in violation of its certificate
of incorporation or by-laws or in default in the performance or
observance of any material obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, loan agreement, note,
lease or other instrument to which the Depositor is a party or by which
it or its properties may be bound, which default might result in any
material adverse changes in the financial condition, earnings, affairs
or business of the Depositor or which might materially and adversely
affect the properties or assets, taken as a whole, of the Depositor;
(vii) the execution, delivery and performance of this
Agreement by the Depositor, and the consummation of the transactions
contemplated hereby, do not and will not result in a material breach or
violation of any of the terms or provisions of, or, to the knowledge of
the Depositor, constitute a default under, any indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument to which
the Depositor is a party or by which the Depositor is bound or to which
any of the property or assets of the Depositor is subject, nor will
such actions result in any violation of the provisions of the
certificate of incorporation or by-laws of the Depositor or, to the
best of the Depositor's knowledge without independent investigation,
any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Depositor or
any of its properties or assets (except for such conflicts, breaches,
violations and defaults as would not have a material adverse effect on
the ability of the Depositor to perform its obligations under this
Agreement);
(viii) to the best of the Depositor's knowledge without any
independent investigation, no consent, approval, authorization, order,
registration or qualification of or with any court or governmental
agency or body of the United States or any other jurisdiction is
required for the issuance of the Notes and Trust Certificates, or the
consummation by the Depositor of the other transactions contemplated by
this Agreement, except such consents, approvals, authorizations,
registrations or qualifications as (a) may be required under State
securities or "blue sky" laws, (b) have
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been previously obtained or (c) the failure of which to obtain would
not have a material adverse effect on the performance by the Depositor
of its obligations under, or the validity or enforceability of, this
Agreement; and
(ix) there are no actions, proceedings or investigations
pending before or, to the Depositor's knowledge, threatened by any
court, administrative agency or other tribunal to which the Depositor
is a party or of which any of its properties is the subject: (a) which
if determined adversely to the Depositor would have a material adverse
effect on the business, results of operations or financial condition of
the Depositor; (b) asserting the invalidity of this Agreement, the
Notes or the Trust Certificates; (c) seeking to prevent the issuance of
the Notes or the Trust Certificates or the consummation by the
Depositor of any of the transactions contemplated by this Agreement, as
the case may be; or (d) which might materially and adversely affect the
performance by the Depositor of its obligations under, or the validity
or enforceability of, this Agreement.
(b) Except as set forth in Section 3.01(ii), the Depositor shall have
no obligation or liability with respect to any breach of any representation or
warranty with respect to the Mortgage Loans under any circumstances.
(c) It is understood and agreed that the representations and warranties
of the Depositor set forth in this Section 3.01 shall survive the execution and
delivery of this Agreement. The Depositor shall indemnify the Master Servicer,
the Indenture Trustee, the Owner Trustee, the Seller and the Issuer and hold
each of the Master Servicer, the Indenture Trustee, the Owner Trustee, the
Seller and the Issuer harmless against any loss, damages, penalties, fines,
forfeitures, legal fees and related costs, judgments, and other costs and
expenses resulting from any claim, demand, defense or assertion based on or
grounded upon, or resulting from, a breach of the Depositor's representations
and warranties contained in this Section 3.01 hereof. It is understood and
agreed that the enforcement of the obligation of the Depositor set forth in this
Section to indemnify the Master Servicer, the Indenture Trustee, the Owner
Trustee, the Seller and the Issuer as provided in this Section constitutes the
sole remedy of the Master Servicer, the Seller, the Indenture Trustee, the Owner
Trustee and the Issuer respecting a breach by the Depositor of the
representations and warranties in this Section 3.01.
Any cause of action against the Depositor relating to or arising out of
the breach of the representations and warranties made in this Section 3.01 shall
accrue upon discovery of such breach by the Seller, the Issuer, the Master
Servicer or the Indenture Trustee.
Section 3.02 Representations and Warranties of the Master Servicer. (a)
The Master Servicer hereby represents and warrants to the Depositor, the Issuer,
the Seller, the Owner Trustee and the Indenture Trustee, for the benefit of the
Securityholders, as follows:
(i) it is validly existing and in good standing under the
laws of the United States of America as a national banking association,
and as Master Servicer has full power and authority to transact any and
all business contemplated by this Agreement and to execute, deliver and
comply with its obligations under the terms of this Agreement, the
execution, delivery and performance of which have been duly authorized
by all necessary corporate action on the part of the Master Servicer;
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(ii) the execution and delivery of this Agreement by the
Master Servicer and its performance and compliance with the terms of
this Agreement will not (A) violate the Master Servicer's charter or
bylaws, (B) violate any law or regulation or any administrative decree
or order to which it is subject or (C) constitute a default (or an
event which, with notice or lapse of time, or both, would constitute a
default) under, or result in the breach of, any material contract,
agreement or other instrument to which the Master Servicer is a party
or by which it is bound or to which any of its assets are subject,
which violation, default or breach would materially and adversely
affect the Master Servicer's ability to perform its obligations under
this Agreement;
(iii) this Agreement constitutes, assuming due
authorization, execution and delivery hereof by the other respective
parties hereto, a legal, valid and binding obligation of the Master
Servicer, enforceable against it in accordance with the terms hereof,
except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the enforcement of
creditors' rights in general, and by general equity principles
(regardless of whether such enforcement is considered in a proceeding
in equity or at law);
(iv) the Master Servicer is not in default with respect to
any order or decree of any court or any order or regulation of any
federal, state, municipal or governmental agency to the extent that any
such default would materially and adversely affect its performance
hereunder;
(v) the Master Servicer is not a party to or bound by any
agreement or instrument or subject to any charter provision, bylaw or
any other corporate restriction or any judgment, order, writ,
injunction, decree, law or regulation that may materially and adversely
affect its ability as Master Servicer to perform its obligations under
this Agreement or that requires the consent of any third person to the
execution of this Agreement or the performance by the Master Servicer
of its obligations under this Agreement;
(vi) no litigation is pending or, to the best of the
Master Servicer's knowledge, threatened against the Master Servicer
which would prohibit its entering into this Agreement or performing its
obligations under this Agreement;
(vii) the Master Servicer, or an affiliate thereof the
primary business of which is the servicing of conventional residential
mortgage loans, is a Xxxxxx Xxx- or Xxxxxxx Mac-approved
seller/servicer;
(viii) no consent, approval, authorization or order of any
court or governmental agency or body is required for the execution,
delivery and performance by the Master Servicer of or compliance by the
Master Servicer with this Agreement or the consummation of the
transactions contemplated by this Agreement, except for such consents,
approvals, authorizations and orders (if any) as have been obtained;
(ix) the consummation of the transactions contemplated by
this Agreement are in the ordinary course of business of the Master
Servicer;
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(x) the Master Servicer has obtained an errors and
omissions insurance policy and a fidelity bond in accordance with
Section 4.03 each of which is in full force and effect, and each of
which provides at least such coverage as is required hereunder; and
(xi) the information about the Master Servicer under the
heading "The Master Servicer" in the Offering Documents relating to the
Master Servicer does not include an untrue statement of a material fact
and does not omit to state a material fact, with respect to the
statements made, necessary in order to make the statements in light of
the circumstances under which they were made not misleading.
(b) It is understood and agreed that the representations and warranties
set forth in this Section 3.02 shall survive the execution and delivery of this
Agreement. The Master Servicer shall indemnify the Depositor, the Issuer, the
Owner Trustee, the Seller and the Indenture Trustee and hold them harmless
against any loss, damages, penalties, fines, forfeitures, legal fees and related
costs, judgments, and other costs and expenses resulting from any claim, demand,
defense or assertion based on or grounded upon, or resulting from, a breach of
the Master Servicer's representations and warranties contained in Section
3.02(a). It is understood and agreed that the enforcement of the obligation of
the Master Servicer set forth in this Section to indemnify the Depositor, the
Issuer, the Owner Trustee, the Seller and the Indenture Trustee as provided in
this Section constitutes the sole remedy (other than as set forth in Section
6.01) of the Depositor, the Issuer, the Seller, the Owner Trustee and the
Indenture Trustee, respecting a breach of the foregoing representations and
warranties. Such indemnification shall survive any termination of the Master
Servicer as Master Servicer hereunder, and any termination of this Agreement.
Any cause of action against the Master Servicer relating to or arising
out of the breach of any representations and warranties made in this Section
shall accrue upon discovery of such breach by the Depositor, the Master
Servicer, the Indenture Trustee, the Seller or the Issuer or notice thereof by
any one of such parties to the other parties.
Section 3.03 Repurchase or Substitution of Mortgage Loans by Seller.
(a) It is understood and agreed that the representations and warranties
(i) set forth in Section 3.01 and (ii) of the Seller set forth in the Mortgage
Loan Purchase Agreement and assigned to the Issuer by the Depositor hereunder
shall be pledged by the Issuer to the Indenture Trustee under the Indenture and
shall each survive delivery of the Mortgage Files and the Assignment of each
Mortgage Loan to the Indenture Trustee and shall continue throughout the term of
this Agreement. Upon discovery or receipt of written notice that a document does
not comply with the requirements of Section 2.01, or that a document is missing
from, a Mortgage File or upon actual knowledge or receipt of written notice of
the breach by the Seller of any representation, warranty or covenant under the
Mortgage Loan Purchase Agreement or in Section 3.04 or Section 3.05 hereof in
respect of any Mortgage Loan which materially adversely affects the value of
that Mortgage Loan or the interest therein of the Securityholders, the Indenture
Trustee (or the Custodian as its designated agent) shall promptly notify the
Seller of such noncompliance, missing document or breach and request that the
Seller deliver such missing document or cure such noncompliance or breach within
90 days from the date that the Seller was notified of such missing document,
noncompliance or breach, and if the Seller does
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not deliver such missing document or cure such noncompliance or breach in all
material respects during such period, the Indenture Trustee shall enforce the
Seller's obligation under the Mortgage Loan Purchase Agreement and cause the
Seller to repurchase that Mortgage Loan from the Trust Estate at the Purchase
Price on or prior to the Determination Date following the expiration of such 90
day period; provided, however, that, in connection with any such breach that
could not reasonably have been cured within such 90 day period, if the Seller
shall have commenced to cure such breach within such 90 day period, the Seller
shall be permitted to proceed thereafter diligently and expeditiously to cure
the same within the additional period provided under the Mortgage Loan Purchase
Agreement; and, provided further, that, in the case of the breach of any
representation, warranty or covenant made by the Seller in Schedule III to the
Mortgage Loan Purchase Agreement, the Seller shall be obligated to cure such
breach or purchase the affected Mortgage Loans for the Purchase Price or, if the
Mortgage Loan or the related Mortgaged Property acquired with respect thereto
has been sold, then the Seller shall pay, in lieu of the Purchase Price, any
excess of the Purchase Price over the Net Liquidation Proceeds received upon
such sale. The Purchase Price for the repurchased Mortgage Loan or such other
amount due shall be deposited in the Collection Account on or prior to the next
Determination Date after the Seller's obligation to repurchase such Mortgage
Loan arises. The Indenture Trustee, upon receipt of written certification in the
form of Exhibit B hereto from the Master Servicer of the related deposit in the
Collection Account, shall release to the Seller the related Mortgage File and
shall execute and deliver such instruments of transfer or assignment, in each
case without recourse, as the Seller shall furnish to it and as shall be
necessary to vest in the Seller any Mortgage Loan released pursuant hereto and
the Indenture and the Indenture Trustee shall have no further responsibility
with regard to such Mortgage File (it being understood that the Indenture
Trustee shall have no responsibility for determining the sufficiency of such
assignment for its intended purpose). In lieu of repurchasing any such Mortgage
Loan as provided above, the Seller may cause such Mortgage Loan to be removed
from the Trust Estate (in which case it shall become a Deleted Mortgage Loan)
and substitute one or more Qualified Substitute Mortgage Loans in the manner and
subject to the limitations set forth in Section 3.03(d) below. It is understood
and agreed that the obligation of the Seller to cure or to repurchase (or to
substitute for) any Mortgage Loan as to which a document is missing, a material
defect in a constituent document exists or as to which such a breach has
occurred and is continuing shall constitute the sole remedy against the Seller
respecting such omission, defect or breach available to the Indenture Trustee on
behalf of the Securityholders.
The Indenture Trustee shall enforce the obligations of the Seller under
the Mortgage Loan Purchase Agreement including, without limitation, any
obligation of the Seller to purchase a Mortgage Loan on account of missing or
defective documentation or on account of a breach of a representation, warranty
or covenant as described in this Section 3.03(a).
(b) If pursuant to the provisions of Section 3.03(a), the Seller
repurchases or otherwise removes from the Trust Estate a Mortgage Loan that is a
MERS Mortgage Loan, the Seller will take (or shall cause the applicable Servicer
to take), at the expense of the Seller (with the cooperation of the Depositor,
the Indenture Trustee and the Master Servicer), such actions as are necessary
either (i) cause MERS to execute and deliver an Assignment of Mortgage in
recordable form to transfer the Mortgage from MERS to the Seller and shall cause
such Mortgage to be removed from registration on the MERS(R) System in
accordance with MERS'
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rules and regulations or (ii) cause MERS to designate on the MERS(R) System the
Seller or its designee as the beneficial holder of such Mortgage Loan.
(c) [Reserved].
(d) Any substitution of Qualified Substitute Mortgage Loans for Deleted
Mortgage Loans made pursuant to Section 3.03(a) above must be effected prior to
the last Business Day that is within two years after the Closing Date. As to any
Deleted Mortgage Loan for which the Seller substitutes a Qualified Substitute
Mortgage Loan or Loans, such substitution shall be effected by the Seller
delivering to the Indenture Trustee, for such Qualified Substitute Mortgage Loan
or Loans, the Mortgage Note, the Mortgage, the Assignment to the Indenture
Trustee, and such other documents and agreements, with all necessary
endorsements thereon, as are required by Section 2.01 hereof, together with an
Officers' Certificate stating that each such Qualified Substitute Mortgage Loan
satisfies the definition thereof and specifying the Substitution Adjustment (as
described below), if any, in connection with such substitution; provided,
however, that, in the case of any Qualified Substitute Mortgage Loan that is a
MERS Mortgage Loan, the Seller shall provide such documents and take such other
action with respect to such Qualified Substitute Mortgage Loans as are required
pursuant to Section 2.01 hereof. The Indenture Trustee shall acknowledge receipt
of such Qualified Substitute Mortgage Loan or Loans and, within five Business
Days thereafter, shall review such documents as specified in Section 2.02 hereof
and deliver with respect to such Qualified Substitute Mortgage Loan or Loans, a
certification substantially in the form attached hereto as Exhibit A-2, with any
exceptions noted thereon. Within 180 days of the date of substitution, the
Indenture Trustee shall deliver to the Seller and the Master Servicer a
certification substantially in the form of Exhibit A-3 hereto with respect to
such Qualified Substitute Mortgage Loan or Loans, with any exceptions noted
thereon. Monthly Payments due with respect to Qualified Substitute Mortgage
Loans in the month of substitution are not part of the Trust Estate and will be
retained by the Seller. For the month of substitution, payments to
Securityholders will reflect the collections and recoveries in respect of such
Deleted Mortgage Loan in the Due Period preceding the month of substitution and
the Depositor or the Seller, as the case may be, shall thereafter be entitled to
retain all amounts subsequently received in respect of such Deleted Mortgage
Loan. The Seller shall give or cause to be given written notice to the
Securityholders that such substitution has taken place, shall amend the Mortgage
Loan Schedule to reflect the removal of such Deleted Mortgage Loan from the
terms of this Agreement and the substitution of the Qualified Substitute
Mortgage Loan or Loans and shall deliver a copy of such amended Mortgage Loan
Schedule to the Indenture Trustee. Upon such substitution, such Qualified
Substitute Mortgage Loan or Loans shall constitute part of the Trust Estate and
shall be subject in all respects to the terms of this Agreement and, in the case
of a substitution effected by the Seller, the Mortgage Loan Purchase Agreement,
including, in the case of a substitution effected by the Seller all
representations and warranties thereof included in the Mortgage Loan Purchase
Agreement and all representations and warranties thereof set forth in Section
3.04 hereof, in each case as of the date of substitution.
For any month in which the Seller substitutes one or more Qualified
Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the Seller
shall determine, and provide written certification to the Indenture Trustee and
the Depositor as to, the amount (each, a "Substitution
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Adjustment"), if any, by which the aggregate Purchase Price of all such Deleted
Mortgage Loans exceeds the aggregate, as to each such Qualified Substitute
Mortgage Loan, of the principal balance thereof as of the date of substitution,
together with one month's interest on such principal balance at the applicable
Net Loan Rate. On or prior to the next Determination Date after the Seller's
obligation to repurchase the related Deleted Mortgage Loan arises, the Seller
will deliver or cause to be delivered to the Indenture Trustee for deposit in
the Collection Account an amount equal to the related Substitution Adjustment,
if any, and the Indenture Trustee, upon receipt of the related Qualified
Substitute Mortgage Loan or Loans, shall release to the Seller the related
Mortgage File or Files and shall execute and deliver such instruments of
transfer or assignment, in each case without recourse, as the Seller shall
deliver to it and as shall be necessary to vest therein any Deleted Mortgage
Loan released pursuant hereto.
Section 3.04 Representations and Warranties of the Seller with Respect
to the Mortgage Loans.
The Seller hereby represents and warrants to the Issuer and the
Indenture Trustee for the benefit of the Securityholders that the
representations and warranties made by the Seller pursuant to Schedule III to
the Mortgage Loan Purchase Agreement are hereby being made to the Issuer and the
Indenture Trustee and are true and correct on the Closing Date.
With respect to the representations and warranties incorporated in this
Section 3.04 that are made to the best of the Seller's knowledge or as to which
the Seller has no knowledge, if it is discovered by the Depositor, the Issuer,
the Seller or the Indenture 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 interest therein of the
Securityholders then, notwithstanding the Seller's lack of knowledge with
respect to the substance of such representation and warranty being inaccurate at
the time the representation or warranty was made, such inaccuracy shall be
deemed a breach of the applicable representation or warranty.
Within 90 days of its discovery or its receipt of notice of any such
missing or materially defective documentation or any such breach of a
representation or warranty, the Seller shall promptly deliver such missing
document or cure such defect or breach in all material respects or, in the event
such defect or breach cannot be cured, the Seller shall repurchase the affected
Mortgage Loan or cause the removal of such Mortgage Loan from the Trust Estate
and substitute for it one or more Qualified Substitute Mortgage Loans, in either
case, in accordance with Section 3.03 hereof.
It is understood and agreed that the representations and warranties
incorporated in this Section 3.04 shall survive delivery of the Mortgage Files
to the Indenture Trustee and shall inure to the benefit of the Securityholders
notwithstanding any restrictive or qualified endorsement or assignment. Upon
discovery by any of the Depositor, the Seller, the Issuer or the Indenture
Trustee of a breach of any of the foregoing representations and warranties which
materially and adversely affects the value of any Mortgage Loan or the interests
therein of the Securityholders, the party discovering such breach shall give
prompt written notice to the other parties, and in no event later than two
Business Days from the date of such discovery. It is understood and agreed that
the obligations of the Seller set forth in Section 3.03(a) hereof to cure,
substitute for or repurchase a related Mortgage Loan pursuant to the Mortgage
Loan Purchase Agreement
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constitute the sole remedies available to the Securityholders or to the
Indenture Trustee on their behalf respecting a breach of the representations and
warranties incorporated in this Section 3.04.
Section 3.05 Representations and Warranties of the Seller.
The Seller hereby represents and warrants to the Issuer and the
Indenture Trustee on behalf of the Securityholders that, as of the Closing Date
or as of such date specifically provided herein:
(i) the Seller is duly organized, validly existing and in
good standing as a corporation under the laws of the State of Delaware
and is and will remain in compliance with the laws of each state in
which any Mortgaged Property is located to the extent necessary to
fulfill its obligations hereunder;
(ii) the Seller has the power and authority to hold each
Mortgage Loan, to sell each Mortgage Loan, to execute, deliver and
perform, and to enter into and consummate, all transactions
contemplated by this Agreement. The Seller has duly authorized the
execution, delivery and performance of this Agreement, has duly
executed and delivered this Agreement and this Agreement, assuming due
authorization, execution and delivery by the other parties hereto,
constitutes a legal, valid and binding obligation of the Seller,
enforceable against it in accordance with its terms except as the
enforceability thereof may be limited by bankruptcy, insolvency or
reorganization or other similar laws in relation to the rights of
creditors generally;
(iii) the execution and delivery of this Agreement by the
Seller and the performance of and compliance with the terms of this
Agreement will not violate the Seller's articles of incorporation or
by-laws or constitute a default under or result in a material breach or
acceleration of, any material contract, agreement or other instrument
to which the Seller is a party or which may be applicable to the Seller
or its assets;
(iv) the Seller is not in violation of, and the execution
and delivery of this Agreement by the Seller and its performance and
compliance with the terms of this Agreement will not constitute a
violation with respect to, any order or decree of any court or any
order or regulation of any federal, state, municipal or governmental
agency having jurisdiction over the Seller or its assets, which
violation might have consequences that would materially and adversely
affect the condition (financial or otherwise) or the operation of the
Seller or its assets or might have consequences that would materially
and adversely affect the performance of its obligations and duties
hereunder;
(v) the Seller does not believe, nor does it have any
reason or cause to believe, that it cannot perform each and every
covenant contained in this Agreement;
(vi) the Seller has good, marketable and indefeasible
title to the Mortgage Loans, free and clear of any and all liens,
pledges, charges or security interests of any nature encumbering the
Mortgage Loans and upon the payment of the purchase price under the
Mortgage Loan Purchase Agreement by the Depositor, the Depositor will
have
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good and marketable title to the Mortgage Notes and Mortgage Loans,
free and clear of all liens or encumbrances;
(vii) the Mortgage Loans are not being transferred by the
Seller with any intent to hinder, delay or defraud any creditors of the
Seller;
(viii) there are no actions or proceedings against, or
investigations known to it of, the Seller before any court,
administrative or other tribunal (A) that might prohibit its entering
into this Agreement, (B) seeking to prevent the sale of the Mortgage
Loans or the consummation of the transactions contemplated by this
Agreement or (C) that might prohibit or materially and adversely affect
the performance by the Seller of its obligations under, or validity or
enforceability of, this Agreement;
(ix) no consent, approval, authorization or order of any
court or governmental agency or body is required for the execution,
delivery and performance by the Seller of, or compliance by the Seller
with, this Agreement or the consummation of the transactions
contemplated by this Agreement, except for such consents, approvals,
authorizations or orders, if any, that have been obtained; and
(x) the consummation of the transactions contemplated by
this Agreement are in the ordinary course of business of the Seller,
and the transfer, assignment and conveyance of the Mortgage Notes and
the Mortgages by the Seller pursuant to the Mortgage Loan Purchase
Agreement are not subject to the bulk transfer or any similar statutory
provisions.
Section 3.06 Covenants of the Seller.
The Seller hereby covenants that, except for the transfer under the
Mortgage Loan Purchase Agreement or hereunder, the Seller will not sell, pledge,
assign or transfer to any other Person, or grant, create, incur, assume or
suffer to exist any lien on any Mortgage Loan, or any interest therein; the
Seller will notify the Indenture Trustee, as assignee of the Depositor and the
Issuer, and the Master Servicer of the existence of any lien on any Mortgage
Loan immediately upon discovery thereof, and the Seller will defend the right,
title and interest of the Issuer, as assignee of the Depositor, in, to and under
the Mortgage Loans, against all claims of third parties claiming through or
under the Seller; provided, however, that nothing in this Section 3.06 shall
prevent or be deemed to prohibit the Seller from suffering to exist upon any of
the Mortgage Loans any liens for municipal or other local taxes and other
governmental charges if such taxes or governmental charges shall not at the time
be due and payable or if the Seller shall currently be contesting the validity
thereof in good faith by appropriate proceedings and shall have set aside on its
books adequate reserves with respect thereto.
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ARTICLE IV
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
BY THE MASTER SERVICER
Section 4.01 Master Servicer to Service and Administer the Mortgage
Loans.
The Master Servicer shall supervise, monitor and oversee the obligation
of the Servicers to service and administer their respective Mortgage Loans in
accordance with the terms of the applicable Servicing Agreement and, where
applicable, the Correspondent Sellers Guide and the Master Servicing Guide, and
shall have full power and authority to do any and all things which it may deem
necessary or desirable in connection with such master servicing and
administration. In performing its obligations hereunder, the Master Servicer
shall act in a manner consistent with Accepted Master Servicing Practices and,
where applicable, the Master Servicing Guide. Furthermore, the Master Servicer
shall oversee and consult with each Servicer as necessary from time-to-time to
carry out the Master Servicer's obligations hereunder, shall receive, review and
evaluate all reports, information and other data provided to the Master Servicer
by each Servicer and shall cause each Servicer to perform and observe the
covenants, obligations and conditions to be performed or observed by such
Servicer under the applicable Servicing Agreement. The Master Servicer shall
independently and separately monitor each Servicer's servicing activities with
respect to each related Mortgage Loan, reconcile the results of such monitoring
with such information provided in the previous sentence on a monthly basis and
coordinate corrective adjustments to the Servicers' and Master Servicer's
records, and based on such reconciled and corrected information, prepare the
statements specified in Section 5.10 and any other information and statements
required hereunder. The Master Servicer shall reconcile the results of its
Mortgage Loan monitoring with the actual remittances of the Servicers to the
related Servicing Accounts pursuant to the applicable Servicing Agreements.
The Indenture Trustee shall furnish the Servicers and the Master
Servicer with any limited powers of attorney and other documents in form
acceptable to the Indenture Trustee, necessary or appropriate to enable the
Servicers and the Master Servicer to service and administer the related Mortgage
Loans and REO Property, which limited powers of attorney shall provide that the
Indenture Trustee will not be liable for the actions or omissions of the
Servicers or Master Servicer in exercising such powers.
The Indenture Trustee shall provide access to the records and
documentation in possession of the Indenture Trustee (including in its capacity
as Custodian hereunder) regarding the related Mortgage Loans and REO Property
and the servicing thereof to the Securityholders, the FDIC, and the supervisory
agents and examiners of the FDIC, such access being afforded only upon
reasonable prior written request and during normal business hours at the office
of the Indenture Trustee; provided, however, that, unless otherwise required by
law, the Indenture Trustee shall not be required to provide access to such
records and documentation if the provision thereof would, in the Indenture
Trustee's reasonable judgment, violate the legal right to privacy of any
Mortgagor. The Indenture Trustee shall allow representatives of the above
entities to photocopy any of the records and documentation and shall provide
equipment for that purpose at a charge that covers the Indenture Trustee's
actual costs.
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The Indenture Trustee shall execute (but not prepare) and deliver to
the related Servicer and the Master Servicer any court pleadings, requests for
trustee's sale or other documents necessary or desirable to (i) the foreclosure
or trustee's sale with respect to a Mortgaged Property; (ii) any legal action
brought to obtain judgment against any Mortgagor on the Mortgage Note or
Mortgage; (iii) obtain a deficiency judgment against the Mortgagor; or (iv)
enforce any other rights or remedies provided by the Mortgage Note or Mortgage
or otherwise available at law or equity.
Section 4.02 Monitoring of Servicers.
(a) The Master Servicer shall be responsible for reporting to the
Indenture Trustee (on behalf of the Issuer) and the Depositor the compliance by
each Servicer with its duties under the related Servicing Agreement. In the
review of each Servicer's activities, the Master Servicer may rely upon an
officer's certificate of the Servicer with regard to such Servicer's compliance
with the terms of its Servicing Agreement. In the event that the Master
Servicer, in its judgment, determines that a Servicer should be terminated in
accordance with its Servicing Agreement, or that a notice should be sent
pursuant to such Servicing Agreement with respect to the occurrence of an event
that, unless cured, would constitute grounds for such termination, the Master
Servicer shall notify the Depositor and the Indenture Trustee thereof and the
Master Servicer shall issue such notice or take such other action as it deems
appropriate.
(b) The Master Servicer, for the benefit of the Issuer and the
Securityholders, shall enforce the obligations of each Servicer under the
related Servicing Agreement, and shall, in the event that a Servicer fails to
perform its obligations in accordance with the related Servicing Agreement,
subject to the preceding paragraph, terminate the rights and obligations of such
Servicer thereunder and act as servicer of the related Mortgage Loans or enter
into a new Servicing Agreement with a successor Servicer selected by the Master
Servicer which the Master Servicer shall cause the Indenture Trustee to
acknowledge; provided, however, it is understood and acknowledged by the parties
hereto that there will be a period of transition (not to exceed 90 days) before
the actual servicing functions can be fully transferred to such successor
Servicer. Such enforcement, including, without limitation, the legal prosecution
of claims, termination of Servicing Agreements and the pursuit of other
appropriate remedies, shall be in such form and carried out to such an extent
and at such time as the Master Servicer, in its good faith business judgment,
would require were it the owner of the related Mortgage Loans. The Master
Servicer shall pay the costs of such enforcement at its own expense, provided
that the Master Servicer shall not be required to prosecute or defend any legal
action except to the extent that the Master Servicer shall have received
reasonable indemnity for its costs and expenses in pursuing such action.
(c) To the extent that the costs and expenses of the Master Servicer
related to any termination of a Servicer, appointment of a successor Servicer or
the transfer and assumption of servicing by the Master Servicer with respect to
any Servicing Agreement (including, without limitation, (i) all legal costs and
expenses and all due diligence costs and expenses associated with an evaluation
of the potential termination of the Servicer as a result of an event of default
by such Servicer and (ii) all costs and expenses associated with the complete
transfer of servicing, including all servicing files and all servicing data and
the completion, correction or manipulation
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of such servicing data as may be required by the successor servicer to correct
any errors or insufficiencies in the servicing data or otherwise to enable the
successor service to service the Mortgage Loans in accordance with the related
Servicing Agreement) are not fully and timely reimbursed by the terminated
Servicer, the Master Servicer shall be entitled to reimbursement of such costs
and expenses from the Collection Account.
(d) The Master Servicer shall require each Servicer to comply with the
remittance requirements and other obligations set forth in the related Servicing
Agreement.
(e) If the Master Servicer acts as Servicer, it will not assume
liability for the representations and warranties of the Servicer, if any, that
it replaces.
(f) With respect to Additional Collateral Mortgage Loans, the Master
Servicer shall have no duty or obligation to supervise, monitor or oversee the
activities of each Servicer under its Servicing Agreement with respect to
Additional Collateral or the Guaranty Surety Bond, except (a) with respect to
any instances where a Servicer, in the course of fulfilling its obligations
under the related Servicing Agreement seeks directions, instructions, consents
or waivers from the Master Servicer with respect to any item of Additional
Collateral, or (b) upon the occurrence of the following events (i) in the case
of a final liquidation of any Mortgaged Property secured by Additional
Collateral, the Master Servicer shall enforce the obligation of the Servicer
under the related Servicing Agreement to liquidate such Additional Collateral as
required by such Servicing Agreement, and (ii) if the Master Servicer assumes
the obligations of such Servicer as successor Servicer under the related
Servicing Agreement pursuant to this Section 4.02, as successor Servicer, it
shall be bound to service and administer the Additional Collateral and the
related Guaranty Surety Bond in accordance with the provisions of such Servicing
Agreement.
Section 4.03 Fidelity Bond.
The Master Servicer, at its expense, shall maintain in effect a blanket
fidelity bond and an errors and omissions insurance policy, affording coverage
with respect to all directors, officers, employees and other Persons acting on
such Master Servicer's behalf, and covering errors and omissions in the
performance of the Master Servicer's obligations hereunder. The errors and
omissions insurance policy and the fidelity bond shall be in such form and
amount generally acceptable for entities serving as master servicers or
trustees.
Section 4.04 Power to Act; Procedures. The Master Servicer shall master
service the Mortgage Loans and shall have full power and authority, subject to
the provisions of this Agreement, to do any and all things that it may deem
necessary or desirable in connection with the master servicing and
administration of the Mortgage Loans, including but not limited to the power and
authority (i) to execute and deliver, on behalf of the Securityholders and the
Indenture Trustee, customary consents or waivers and other instruments and
documents, (ii) to consent to transfers of any Mortgaged Property and
assumptions of the Mortgage Notes and related Mortgages, (iii) to collect any
Insurance Proceeds and Liquidation Proceeds, and (iv) to effectuate, in its own
name, on behalf the Indenture Trustee, or in the name of the Indenture Trustee,
foreclosure or other conversion of the ownership of the Mortgaged Property
securing any Mortgage Loan, in each case, in accordance with the provisions of
this Agreement and the related Servicing Agreement, as applicable; provided,
however, that the Master Servicer shall not
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(and, consistent with its responsibilities under Section 4.02, shall not permit
any Servicer to) knowingly or intentionally take any action, or fail to take (or
fail to cause to be taken) any action that is inconsistent with or prejudices
the interests of the Issuer or the Securityholders in any Mortgage Loan or the
rights and interests of the Depositor, the Indenture Trustee, the Issuer and the
Securityholders under this Agreement and the Indenture. The Master Servicer
shall represent and protect the interests of the Issuer and the Securityholders
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. The
Indenture Trustee shall furnish the Master Servicer, upon written request from a
Servicing Officer, with any limited powers of attorney empowering the Master
Servicer or any Servicer to execute and deliver instruments of satisfaction or
cancellation, or of partial or full release or discharge, and to foreclose upon
or otherwise liquidate Mortgaged Property, and to appeal, prosecute or defend in
any court action relating to the Mortgage Loans or the Mortgaged Property, in
accordance with the applicable Servicing Agreement and this Agreement, and the
Indenture Trustee shall execute and deliver such other documents, as the Master
Servicer may request, to enable the Master Servicer to master service and
administer the Mortgage Loans and carry out its duties hereunder, in each case
in accordance with Accepted Master Servicing Practices (and the Indenture
Trustee shall have no liability for misuse of any such powers of attorney by the
Master Servicer or any Servicer). In instituting foreclosures or similar
proceedings, the Master Servicer shall institute such proceedings either in its
own name on behalf of the Indenture Trustee or in the name of the Indenture
Trustee (or cause the related Servicer, pursuant to the related Servicing
Agreement, to institute such proceedings either in the name of such Servicer on
behalf of the Indenture Trustee or in the name of the Indenture Trustee), unless
otherwise required by law or otherwise appropriate. If the Master Servicer or
the Indenture Trustee has been advised that it is likely that the laws of the
state in which action is to be taken prohibit such action if taken in the name
of the Indenture Trustee or the Indenture Trustee on its behalf or the Issuer,
as applicable, would be adversely affected under the "doing business" or tax
laws of such state if such action is taken in its name, the Master Servicer
shall join with the Indenture Trustee, in the appointment of a co-trustee
pursuant to Section 6.10 of the Indenture. In the performance of its duties
hereunder, the Master Servicer shall be an independent contractor and shall not,
except in those instances where it is taking action in the name of the Indenture
Trustee, be deemed to be the agent of the Indenture Trustee. Under no
circumstance shall the Indenture Trustee have any responsibility or liability
for the Master Servicer's actions or omissions in instances in which the Master
Servicer is taking action in the name of the Indenture Trustee.
Section 4.05 Due-on-Sale Clauses; Assumption Agreement.
To the extent provided in the applicable Servicing Agreement and to the
extent Mortgage Loans contain enforceable due-on-sale clauses, the Master
Servicer shall cause the Servicers to enforce such clauses in accordance with
the applicable Servicing Agreement. If applicable law prohibits the enforcement
of a due-on-sale clause or such clause is otherwise not enforced in accordance
with the applicable Servicing Agreement, and, as a consequence, a Mortgage Loan
is assumed, the original Mortgagor may be released from liability in accordance
with the applicable Servicing Agreement.
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Section 4.06 Release of Mortgage Files. (a) Upon (i) becoming aware of
the payment in full of any Mortgage Loan or (ii) the receipt by the Master
Servicer of a notification that payment in full has been or will be escrowed in
a manner customary for such purposes, the Master Servicer will, or will cause
the related Servicer to, promptly notify the Indenture Trustee (or the
applicable Custodian) by a certification substantially in the form of Exhibit B
hereto signed by a Servicing Officer or in a mutually agreeable electronic
format which will, in lieu of a signature on its face, originate from a
Servicing Officer (which certification shall include a statement to the effect
that all amounts received in connection with such payment that are required to
be deposited in the related Servicing Account maintained by the applicable
Servicer pursuant to Section 5.01 or by the applicable Servicer pursuant to its
Servicing Agreement have been or will be so deposited) and shall request that
the Indenture Trustee (or the Custodian, on behalf of the Indenture Trustee)
deliver to the applicable Servicer the related Mortgage File. Upon receipt of
such certification and request, the Indenture Trustee (or the Custodian, on
behalf of the Indenture Trustee), shall promptly release the related Mortgage
File to the applicable Servicer and the Indenture Trustee (and the Custodian, if
applicable) shall have no further responsibility with regard to such Mortgage
File. Upon any such payment in full, each Servicer is authorized, to give, as
agent for the Indenture Trustee, as the mortgagee under the Mortgage that
secured the Mortgage Loan, an instrument of satisfaction (or assignment of
mortgage without recourse) regarding the Mortgaged Property subject to the
Mortgage, which instrument of satisfaction or assignment, as the case may be,
shall be delivered to the Person or Persons entitled thereto against receipt
therefor of such payment, it being understood and agreed that no expenses
incurred in connection with such instrument of satisfaction or assignment, as
the case may be, shall be chargeable to the related Servicing Account.
(b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan and in accordance with the applicable Servicing
Agreement, the Indenture Trustee shall execute such documents as shall be
prepared and furnished to the Indenture Trustee by a Servicer or the Master
Servicer (in form reasonably acceptable to the Indenture Trustee) and as are
necessary to the prosecution of any such proceedings. The Indenture Trustee (or
the Custodian, on behalf of the Indenture Trustee) shall, upon the request of a
Servicer or the Master Servicer, and delivery to the Indenture Trustee (or the
Custodian, on behalf of the Indenture Trustee) of one copy of a request for
release signed by a Servicing Officer substantially in the form of Exhibit B (or
in a mutually agreeable electronic format which will, in lieu of a signature on
its face, originate from a Servicing Officer), release the related Mortgage File
held in its possession or control to the Servicer or the Master Servicer, as
applicable. Such trust receipt shall obligate the Servicer or the Master
Servicer to return the Mortgage File to the Indenture Trustee (or the Custodian
on behalf of the Indenture Trustee) when the need therefor by the Servicer or
the Master Servicer no longer exists (as determined by such Servicer or the
Master Servicer, as applicable) unless the Mortgage Loan shall be liquidated, in
which case, upon receipt of a certificate of a Servicing Officer similar to that
hereinabove specified, the Mortgage File shall be released by the Indenture
Trustee (or the Custodian on behalf of the Indenture Trustee), to the Servicer
or the Master Servicer.
Section 4.07 Documents, Records and Funds in Possession of Master
Servicer To Be Held for Indenture Trustee.
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(a) The Master Servicer shall transmit and each Servicer (to the extent
required by the related Servicing Agreement) shall transmit to the Indenture
Trustee (or Custodian) such documents and instruments coming into the possession
of the Master Servicer or such Servicer from time to time as are required by the
terms hereof, or in the case of the Servicers, the applicable Servicing
Agreement, to be delivered to the Indenture Trustee (or Custodian). Any funds
received by the Master Servicer or by a Servicer in respect of any Mortgage Loan
or which otherwise are collected by the Master Servicer or by a Servicer as
Liquidation Proceeds or Insurance Proceeds in respect of any Mortgage Loan shall
be held for the benefit of the Indenture Trustee and the Securityholders subject
to the Master Servicer's right to retain or withdraw from the Collection Account
the Master Servicing Fee, any additional compensation pursuant to Section 4.12
and any other amounts provided in this Agreement, and to the right of each
Servicer to retain its Servicing Fee and any other amounts as provided in the
applicable Servicing Agreement. The Master Servicer shall, and (to the extent
provided in the applicable Servicing Agreement) shall cause each Servicer to,
provide access to information and documentation regarding the Mortgage Loans to
the Indenture Trustee, its agents and accountants at any time upon reasonable
request and during normal business hours, and to Securityholders that are
savings and loan associations, banks or insurance companies, the Office of
Thrift Supervision, the FDIC and the supervisory agents and examiners of such
Office and Corporation or examiners of any other federal or state banking or
insurance regulatory authority if so required by applicable regulations of the
Office of Thrift Supervision or other regulatory authority, such access to be
afforded without charge but only upon reasonable request in writing and during
normal business hours at the offices of the Master Servicer designated by it. In
fulfilling such a request the Master Servicer shall not be responsible for
determining the sufficiency of such information.
(b) All Mortgage Files and funds collected or held by, or under the
control of, the Master Servicer, in respect of any Mortgage Loans, whether from
the collection of principal and interest payments or from Liquidation Proceeds
or Insurance Proceeds, shall be held by the Master Servicer for and on behalf of
the Indenture Trustee and the Securityholders and shall be and remain the sole
and exclusive property of the Issuer; provided, however, that the Master
Servicer and each Servicer shall be entitled to setoff against, and deduct from,
any such funds any amounts that are properly due and payable to the Master
Servicer or such Servicer under this Agreement or the applicable Servicing
Agreement.
Section 4.08 Standard Hazard Insurance and Flood Insurance Policies.
(a) For each Mortgage Loan (other than a Cooperative Loan), the Master
Servicer shall enforce any obligation of the Servicers under the related
Servicing Agreements to maintain or cause to be maintained standard fire and
casualty insurance and, where applicable, flood insurance, all in accordance
with the provisions of the related Servicing Agreements. It is understood and
agreed that such insurance shall be with insurers meeting the eligibility
requirements set forth in the applicable Servicing Agreement and that no
earthquake or other additional insurance is to be required of any Mortgagor or
to be maintained on property acquired in respect of a defaulted loan, other than
pursuant to such applicable laws and regulations as shall at any time be in
force and as shall require such additional insurance.
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(b) Pursuant to Section 5.01 and 5.02, any amounts collected by the
Servicers or the Master Servicer, or by any Servicer, under any insurance
policies (other than amounts to be applied to the restoration or repair of the
property subject to the related Mortgage or released to the Mortgagor in
accordance with the applicable Servicing Agreement) shall be deposited into the
Collection Account, subject to withdrawal pursuant to Section 5.02 and 5.03. Any
cost incurred by the Master Servicer or any Servicer in maintaining any such
insurance if the Mortgagor defaults in its obligation to do so shall be added to
the amount owing under the Mortgage Loan where the terms of the Mortgage Loan so
permit; provided, however, that the addition of any such cost shall not be taken
into account for purposes of calculating the distributions to be made to
Securityholders and shall be recoverable by the Master Servicer or such Servicer
pursuant to Section 5.02 and 5.03.
Section 4.09 Maintenance of the Primary Insurance Policies.
(a) The Master Servicer shall not take, or permit any Servicer (to the
extent such action is prohibited under the applicable Servicing Agreement) to
take, any action that would result in noncoverage under any applicable Primary
Insurance Policy of any loss which, but for the actions of such Master Servicer
or Servicer, would have been covered thereunder. The Master Servicer shall use
its best reasonable efforts to cause each Servicer (to the extent required under
the related Servicing Agreement) to keep in force and effect (to the extent that
the Mortgage Loan requires the Mortgagor to maintain such insurance), primary
mortgage insurance applicable to each Mortgage Loan (including any lender-paid
Primary Insurance Policy) in accordance with the provisions of this Agreement
and the related Servicing Agreement, as applicable. The Master Servicer shall
not, and shall not permit any Servicer (to the extent required under the related
Servicing Agreement) to, cancel or refuse to renew any such Primary Insurance
Policy that is in effect at the date of the initial issuance of the Mortgage
Note and is required to be kept in force hereunder except in accordance with the
provisions of this Agreement and the related Servicing Agreement, as applicable.
(b) The Master Servicer agrees to cause each Servicer (to the extent
required under the related Servicing Agreement) to present, on behalf of the
Indenture Trustee, the Issuer and the Securityholders, claims to the insurer
under any Primary Insurance Policies and, in this regard, to take such
reasonable action as shall be necessary to permit recovery under any Primary
Insurance Policies respecting defaulted Mortgage Loans. Pursuant to Section 5.01
and 5.02, any amounts collected by the Servicer under any Primary Insurance
Policies shall be deposited in the Collection Account, subject to withdrawal
pursuant to Section 5.03.
Section 4.10 Indenture Trustee to Retain Possession of Certain
Insurance Policies and Documents.
The Indenture Trustee (or the Custodian, as directed by the Indenture
Trustee), shall retain possession and custody of the originals (to the extent
available) of any Primary Insurance Policies, or certificate of insurance if
applicable, and any certificates of renewal as to the foregoing as may be issued
from time to time as contemplated by this Agreement. Until all amounts
distributable in respect of the Notes have been distributed in full and the
Master Servicer otherwise has fulfilled its obligations under this Agreement,
the Indenture Trustee (or its Custodian, if any, as directed by the Indenture
Trustee) shall also retain possession and custody
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of each Mortgage File in accordance with and subject to the terms and conditions
of this Agreement. The Master Servicer shall promptly deliver or cause to be
delivered to the Indenture Trustee (or the Custodian, as directed by the
Indenture Trustee), upon the execution or receipt thereof the originals of any
Primary Insurance Policies, any certificates of renewal, and such other
documents or instruments that constitute portions of the Mortgage File that come
into the possession of the Master Servicer from time to time.
Section 4.11 Realization Upon Defaulted Mortgage Loans.
The Master Servicer shall cause each Servicer (to the extent required
under the related Servicing Agreement) to foreclose upon, repossess or otherwise
comparably convert the ownership of Mortgaged Properties securing such of the
Mortgage Loans as come into and continue in default and as to which no
satisfactory arrangements can be made for collection of delinquent payments, all
in accordance with the applicable Servicing Agreement.
Section 4.12 Compensation to the Master Servicer.
All income and gain realized from any investment of funds in the
Collection Account shall be for the benefit of the Master Servicer as additional
compensation. Servicing compensation in the form of assumption fees, if any,
late payment charges, as collected, if any, or otherwise (but not including any
Prepayment Penalty Amounts) shall be retained by the applicable Servicer, or the
Master Servicer, and shall not be deposited in the related Servicing Account or
Collection Account. The Master Servicer shall be required to pay all expenses
incurred by it in connection with its activities hereunder and shall not be
entitled to reimbursement therefor except as provided in this Agreement. The
amount of the aggregate compensation payable as set forth in this Section 4.12
plus the Master Servicing Fee due to the Master Servicer in respect of any
Payment Date shall be reduced in accordance with Section 5.12.
Section 4.13 REO Property.
(a) In the event the Issuer acquires ownership of any REO Property in
respect of any Mortgage Loan, the deed or certificate of sale shall be issued to
the Indenture Trustee, or to its nominee, on behalf of the Securityholders. The
Master Servicer shall use its reasonable best efforts to sell, or cause the
applicable Servicer, to the extent provided in the applicable Servicing
Agreement to sell any REO Property as expeditiously as possible and in
accordance with the provisions of this Agreement and the related Servicing
Agreement, as applicable. Pursuant to its efforts to sell such REO Property, the
Master Servicer shall protect and conserve, or cause the applicable Servicer to
protect and conserve, such REO Property in the manner and to such extent
required by the applicable Servicing Agreement.
(b) The Master Servicer shall deposit or cause to be deposited all
funds collected and received by it, or recovered from any Servicer, in
connection with the operation of any REO Property in the Collection Account.
(c) The Master Servicer and each Servicer, upon the final disposition
of any REO Property, shall be entitled to reimbursement for any related
unreimbursed Advances and other
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unreimbursed advances as well as any unpaid Master Servicing Fees or Servicing
Fees from Liquidation Proceeds received in connection with the final disposition
of such REO Property; provided, that any such unreimbursed Advances as well as
any unpaid Master Servicing Fees or Servicing Fees may be reimbursed or paid, as
the case may be, prior to final disposition, out of any net rental income or
other net amounts derived from such REO Property.
(d) The Liquidation Proceeds from the final disposition of the REO
Property, net of any payment to the Master Servicer and the applicable Servicer
as provided above, shall be deposited in the Collection Account on or prior to
the Determination Date in the month following receipt thereof (and the Master
Servicer shall provide prompt written notice to the Indenture Trustee upon such
deposit) and be remitted by wire transfer in immediately available funds to the
Indenture Trustee for deposit into the Note Account on the next succeeding
Master Servicer Remittance Date.
Section 4.14 Annual Officer's Certificate as to Compliance.
(a) The Master Servicer shall deliver to the Issuer, the Indenture
Trustee and each Rating Agency on or before March 1 of each year, commencing in
March, 2004, an Officer's Certificate, certifying that with respect to the
period ending December 31 of the prior year: (i) such Servicing Officer has
reviewed the activities of such Master Servicer during the preceding calendar
year or portion thereof and its performance under this Agreement, (ii) to the
best of such Servicing Officer's knowledge, based on such review, such Master
Servicer has performed and fulfilled its duties, responsibilities and
obligations under this Agreement in all material respects throughout such year,
or, if there has been a default in the fulfillment of any such duties,
responsibilities or obligations, specifying each such default known to such
Servicing Officer and the nature and status thereof, (iii) nothing has come to
the attention of such Servicing Officer to lead such Servicing Officer to
believe that any Servicer has failed to perform any of its duties,
responsibilities and obligations under its Servicing Agreement in all material
respects throughout such year, or, if there has been a material default in the
performance or fulfillment of any such duties, responsibilities or obligations,
specifying each such default known to such Servicing Officer and the nature and
status thereof.
(b) Copies of such statements shall be provided to any Securityholder
upon request, by the Master Servicer or by the Indenture Trustee at the Master
Servicer's expense if the Master Servicer failed to provide such copies (unless
(i) the Master Servicer shall have failed to provide the Indenture Trustee with
such statement or (ii) the Indenture Trustee shall be unaware of the Master
Servicer's failure to provide such statement).
Section 4.15 Annual Independent Accountant's Servicing Report.
If the Master Servicer has, during the course of any fiscal year,
directly serviced any of the Mortgage Loans, then the Master Servicer at its
expense shall cause a nationally recognized firm of independent certified public
accountants to furnish a statement to the Issuer, the Indenture Trustee, the
Rating Agencies and the Depositor on or before March 1 of each year, commencing
on March 1, 2004 to the effect that, with respect to the most recently ended
fiscal year, such firm has examined certain records and documents relating to
the Master Servicer's performance of its servicing obligations under this
Agreement and servicing and trust agreements
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in material respects similar to this Agreement and to each other and that, on
the basis of such examination conducted substantially in compliance with the
audit program for mortgages serviced for Xxxxxxx Mac or the Uniform Single
Attestation Program for Mortgage Bankers, such firm is of the opinion that the
Master Servicer's activities have been conducted in compliance with this
Agreement, or that such examination has disclosed no material items of
noncompliance except for (i) such exceptions as such firm believes to be
immaterial, (ii) such other exceptions as are set forth in such statement and
(iii) such exceptions that the Uniform Single Attestation Program for Mortgage
Bankers or the Audit Program for Mortgages Serviced by Xxxxxxx Mac requires it
to report. Copies of such statements shall be provided to any Securityholder
upon request by the Master Servicer, or by the Indenture Trustee at the expense
of the Master Servicer if the Master Servicer shall fail to provide such copies.
If such report discloses exceptions that are material, the Master Servicer shall
advise the Issuer and the Indenture Trustee whether such exceptions have been or
are susceptible of cure, and will take prompt action to do so.
Section 4.16 Reports Filed with Securities and Exchange Commission.
Within 15 days after each Payment Date, the Master Servicer shall, in
accordance with industry standards, file with the Commission via the Electronic
Data Gathering and Retrieval System ("XXXXX"), a Form 8-K with a copy of the
Payment Date Statement as an exhibit thereto. Prior to January 30, 2004, the
Master Servicer shall, in accordance with industry standards, file a Form 15
Suspension Notice with respect to the Issuer, if applicable. Prior to (i) March
31, 2004 and (ii) unless and until a Form 15 Suspension Notice shall have been
filed, prior to March 31 of each year thereafter, the Master Servicer shall
provide a Master Servicer Certification, together with a copy of the annual
independent accountant's servicing report and annual statement of compliance of
each Servicer, in each case, required to be delivered pursuant to its Servicing
Agreement, and, if applicable, the annual independent accountant's servicing
report and annual statement of compliance to be delivered by the Master Servicer
pursuant to Section 4.15. Prior to (i) March 31, 2004 and (ii) unless and until
a Form 15 Suspension Notice shall have been filed, March 31 of each year
thereafter, the Master Servicer shall file a Form 10-K, in substance conforming
to industry standards, with respect to the Issuer. Such Form 10-K shall include
the Master Servicer Certification and other documentation provided by the Master
Servicer pursuant to the second preceding sentence. The Depositor hereby grants
to the Master Servicer a limited power of attorney to execute and file each such
document on behalf of the Depositor. Such power of attorney shall continue until
either the earlier of (i) receipt by the Master Servicer from the Depositor of
written termination of such power of attorney and (ii) the termination of the
Issuer. The Depositor agrees to promptly furnish to the Master Servicer, from
time to time upon request, such further information, reports and financial
statements within its control related to this Agreement and the Mortgage Loans
as the Master Servicer reasonably deems appropriate to prepare and file all
necessary reports with the Commission. The Master Servicer shall have no
responsibility to file any items other than those specified in this Section
4.16; provided, however, the Master Servicer will cooperate with the Depositor
in connection with any additional filings with respect to the Issuer as the
Depositor deems necessary under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"). Copies of all reports filed by the Master Servicer under
the Exchange Act shall be sent to the Depositor and the Issuer. Fees and
expenses incurred by the Master Servicer in connection with this Section 4.16
shall not be reimbursable by the Issuer or from the Trust Estate.
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Section 4.17 Amendments to Master Servicing Guide and Correspondent
Sellers Guide.
The Seller and the Master Servicer hereby agree not to amend the Master
Servicing Guide or the Correspondent Sellers Guide with respect to the Mortgage
Loans (which are Securitized Loans (as defined therein)) which amendment would
(i) change the Servicer Remittance Date or date for remittance of any servicer
reports or monthly remittance advices, (ii) change the manner in which any
Servicer makes Advances, servicing advances or amounts to compensate for
Interest Shortfalls or (iii) otherwise have a material adverse effect on the
Indenture Trustee or the Securityholders unless such changes are made pursuant
to the provisions of Section 8.03 hereof.
Section 4.18 Optional Purchase of Certain Mortgage Loans.
(a) Xxxxxxxxx, in its capacity as a Servicer of a substantial portion
of the Mortgage Loans, shall have the right to purchase from the Issuer any
Mortgage Loan which as of the first day of a calendar quarter is delinquent in
payment by 90 days or more or is an REO Property, at a price equal to the
Purchase Price; provided however (i) that such Mortgage Loan is still 90 days or
more delinquent or is an REO Property as of the date of such purchase and (ii)
this purchase option, if not theretofore exercised, shall terminate on the date
prior to the last day of the related calendar quarter. This purchase option, if
not exercised, shall not be thereafter reinstated unless the delinquency is
cured and the Mortgage Loan thereafter again becomes 90 days or more delinquent
or becomes an REO Property, in which case the option shall again become
exercisable as of the first day of the related calendar quarter.
(b) In addition, Xxxxxxxxx, in its capacity as the Seller, may, but is
not required to, repurchase any Mortgage Loan as to which the Mortgagor has
requested a Significant Modification and such Mortgagor has a satisfactory
payment history under such Mortgage Loan and meets the credit standards of the
Seller for the loan program selected (a "Significant Modification Loan"). A
"Significant Modification" shall mean any modification to the interest rate of
the greater of (i) 0.25% added or subtracted from the existing rate and (ii) a
change equal to the product of (a) 5% and (b) the annual existing interest rate
thereon, which is not provided for in the related Mortgage Note. The purchase
price for any repurchase pursuant to this Section 4.18 shall be the applicable
Purchase Price. In order to exercise its repurchase rights hereunder, the Seller
shall deliver to the Master Servicer and the Indenture Trustee an Officer's
Certificate identifying the Mortgage Loan to be repurchased and certifying that
(i) such Mortgage Loan is a Significant Modification Loan, and (ii) that the
Significant Modification Loan will be entered into on the date of such
repurchase.
(c) No later than the fourth Business Day prior to each Payment Date,
Xxxxxxxxx will provide to the Master Servicer a list identifying all Mortgage
Loans that became Converted Mortgage Loans or Modified Mortgage Loans during the
related Due Period. On the third Business Day prior to each Payment Date,
provided that it has received such list from Xxxxxxxxx, the Master Servicer
shall prepare and provide to TMI a Converted Mortgage Loan Schedule and a
Modified Mortgage Loan Schedule with respect to such Due Period. No later than
1:00 PM Eastern Time on the second Business Day prior to each Payment Date, TMI
shall purchase each Converted Mortgage Loan and Modified Mortgage Loan, to the
extent specified in a Converted Mortgage Loan Schedule or Modified Mortgage Loan
Schedule delivered to it by
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the Master Servicer for such Payment Date, at the applicable Purchase Price for
each such Converted Mortgage Loan or Modified Mortgage Loan, as applicable, and
shall remit such Purchase Price to the Master Servicer for deposit in the
Collection Account.
(d) If at any time Xxxxxxxxx or TMI remits to the Master Servicer a
payment for deposit in the Collection Account covering the amount of the
Purchase Price for a Mortgage Loan of the type set forth in clauses (a), (b) or
(c) above, as applicable, and Xxxxxxxxx or TMI, as applicable, provides to the
Indenture Trustee a certification signed by a Servicing Officer stating that the
amount of such payment has been deposited in the Collection Account, then the
Indenture Trustee shall execute the assignment of such Mortgage Loan at the
request of Xxxxxxxxx or TMI, without recourse to Xxxxxxxxx or TMI, as
applicable, which shall succeed to all the Issuer's and/or the Indenture
Trustee's right, title and interest in and to such Mortgage Loan, and all
security and documents relative thereto. Such assignment shall be an assignment
outright and not for security. Xxxxxxxxx or TMI, as applicable, will thereupon
own such Mortgage Loan, and all such security and documents, free of the lien of
the Indenture and of any further obligation to the Issuer, the Indenture Trustee
or the Securityholders with respect thereto.
Section 4.19 Closing Certificate and Opinion.
On or before the Closing Date, the Master Servicer shall cause to be
delivered to the Depositor, the Seller, the Indenture Trustee, and Greenwich
Capital Markets, Inc. an Opinion of Counsel, dated the Closing Date, in form and
substance reasonably satisfactory to the Depositor, Greenwich Capital Markets,
Inc., and the Seller as to the due authorization, execution and delivery of this
Agreement by the Master Servicer and the enforceability thereof.
Section 4.20 Liabilities of the Master Servicer.
The Master Servicer shall be liable in accordance herewith only to the
extent of the obligations specifically imposed upon and undertaken by it herein.
Section 4.21 Merger or Consolidation of the Master Servicer.
(a) The Master Servicer will keep in full force and effect its
existence, rights and franchises as a corporation under the laws of the state of
its incorporation, and will obtain and preserve its qualification to do business
as a foreign corporation in each jurisdiction in which such qualification is or
shall be necessary to protect the validity and enforceability of this Agreement,
the Securities or any of the Mortgage Loans and to perform its duties under this
Agreement.
(b) Any Person into which the Master Servicer may be merged or
consolidated, or any corporation resulting from any merger or consolidation to
which the Master Servicer shall be a party, or any Person succeeding to the
business of the Master Servicer, shall be the successor of the Master Servicer
hereunder, without the execution or filing of any paper or further act on the
part of any of the parties hereto, anything herein to the contrary
notwithstanding.
Section 4.22 Indemnification of the Indenture Trustee, the Depositor,
the Owner Trustee, the Administrator and the Master
Servicer.
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(a) The Master Servicer agrees to indemnify the Indemnified Persons
(other than the Master Servicer) for, and to hold them harmless against, any
loss, liability or expense (except as otherwise provided herein with respect to
expenses) (including reasonable legal fees and disbursements of counsel)
incurred on their part that may be sustained in connection with, arising out of,
or relating to this Agreement or the Securities (i) related to the Master
Servicer's failure to perform its duties in compliance with this Agreement
(except as any such loss, liability or expense shall be otherwise reimbursable
pursuant to this Agreement, excluding Subsection (b) below) or (ii) incurred by
reason of the Master Servicer's willful misfeasance, bad faith or gross
negligence in the performance of duties hereunder or by reason of reckless
disregard of obligations and duties hereunder, provided, in each case, that with
respect to any such claim or legal action (or pending or threatened claim or
legal action), an Indemnified Person shall have given the Master Servicer and
the Depositor written notice thereof promptly after such Indemnified Person
shall have with respect to such claim or legal action knowledge thereof. The
Indemnified Person's failure to give such notice shall not affect the
Indemnified Person's right to indemnification hereunder. This indemnity shall
survive the resignation or removal of the Indenture Trustee or the Master
Servicer and the termination of this Agreement.
(b) The Issuer will indemnify any Indemnified Person for any loss,
liability or expense of any Indemnified Person not otherwise indemnified by the
Master Servicer that is referred to in Subsection (a) above.
(c) In addition to its obligations under Section 4.22(a), the Master
Servicer agrees to indemnify the Indemnified Persons (other than the Master
Servicer) for, and to hold them harmless against, any loss, liability or expense
(except as otherwise provided herein with respect to expenses) (including
reasonable legal fees and disbursements of counsel) incurred on their part (i)
in connection with, arising out of, or relating to the Master Servicer's failure
to file a Form 10-K in accordance with Section 4.16, (ii) by reason of the
Master Servicer's willful misfeasance, bad faith or gross negligence in the
performance of such obligations pursuant to Section 4.16 or (iii) by reason of
the Master Servicer's reckless disregard of such obligations pursuant to Section
4.16, provided, in each case, that with respect to any such claim or legal
action (or pending or threatened claim or legal action), an Indemnified Person
shall have given the Master Servicer written notice thereof promptly after such
Indemnified Person shall have with respect to such claim or legal action
knowledge thereof. The Indemnified Person's failure to give such notice shall
not affect the Indemnified Person's right to indemnification hereunder. This
indemnity shall survive the resignation or removal of the Indenture Trustee or
the Master Servicer and the termination of this Agreement.
Section 4.23 Limitations on Liability of the Master Servicer and
Others.
Subject to the obligation of the Master Servicer to indemnify the Indemnified
Persons pursuant to Section 4.22:
(a) Neither the Master Servicer nor any of the directors, officers,
employees or agents of the Master Servicer shall be under any liability to the
Indemnified Persons, the Issuer or the Securityholders for taking any action or
for refraining from taking any action in good faith pursuant to this Agreement,
or for errors in judgment; provided, however, that this provision shall not
protect the Master Servicer or any such Person against any breach of warranties
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representations made herein or any liability which would otherwise be imposed by
reason of such Person's willful misfeasance, bad faith or gross negligence in
the performance of duties or by reason of reckless disregard of obligations and
duties hereunder.
(b) The Master Servicer and any director, officer, employee or agent of
the Master Servicer may rely in good faith on any document of any kind prima
facie properly executed and submitted by any Person respecting any matters
arising hereunder.
(c) The Master Servicer, the Indenture Trustee, the Administrator, the
Custodian (including for such purpose, the Indenture Trustee acting in its
capacity as Custodian) and any director, officer, employee or agent of the
Master Servicer, the Indenture Trustee, the Administrator, or the Custodian
shall be indemnified by the Issuer and held harmless thereby against any loss,
liability or expense (except as otherwise provided herein with respect to
expenses) (including reasonable legal fees and disbursements of counsel)
incurred on their part that may be sustained in connection with, arising out of,
or relating to, this Agreement, the Securities or any Servicing Agreement or the
transactions contemplated hereby or thereby (except with respect to the Master
Servicer only, to the extent that the Master Servicer is indemnified by the
Servicer thereunder), other than (i) with respect to the Master Servicer or
Custodian only, any such loss, liability or expense related to the Master
Servicer's failure to perform its duties in compliance with this Agreement or,
if applicable, with respect to the Custodian only, any such loss, liability or
expense related to the Custodian's failure to perform its duties under this
Agreement, or (ii) with respect to the Master Servicer or Custodian, as
applicable, only, any such loss, liability or expense incurred by reason of the
Master Servicer's or the Custodian's, as applicable, willful misfeasance, bad
faith or gross negligence in the performance of its duties hereunder or by
reason of its reckless disregard of obligations and duties hereunder or under a
custodial agreement.
(d) The Master Servicer shall not be under any obligation to appear in,
prosecute or defend any legal action that is not incidental to its duties under
this Agreement and that in its opinion may involve it in any expense or
liability; provided, however, the Master Servicer may in its discretion,
undertake any such action which it may deem necessary or desirable with respect
to this Agreement and the rights and duties of the parties hereto and the
interests of the Issuer and the Securityholders 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 Issuer, and the Master Servicer
shall be entitled to be reimbursed therefor out of the Collection Account as
provided by Section 5.02. Nothing in this Subsection 4.23(d) shall affect the
Master Servicer's obligation to supervise, or to take such actions as are
necessary to ensure, the servicing and administration of the Mortgage Loans
pursuant to Subsection 4.01(a).
(e) In taking or recommending any course of action pursuant to this
Agreement, unless specifically required to do so pursuant to this Agreement, the
Master Servicer shall not be required to investigate or make recommendations
concerning potential liabilities which the Issuer might incur as a result of
such course of action by reason of the condition of the Mortgaged Properties but
shall give notice to the Indenture Trustee if it has notice of such potential
liabilities.
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(f) The Master Servicer shall not be liable for any acts or omissions
of any Servicer, except as otherwise expressly provided herein.
Section 4.24 Master Servicer Not to Resign.
Except as provided in Section 4.26, the Master Servicer shall not
resign from the obligations and duties hereby imposed on it except upon a
determination by it that any such duties hereunder are no longer permissible
under applicable law or are in material conflict by reason of applicable law
with any other activities carried on by it and such impermissibility or conflict
cannot be cured. Any such determination permitting the resignation of the Master
Servicer shall be evidenced by an Independent Opinion of Counsel (delivered at
the expense of the Master Servicer) to such effect delivered to the Issuer and
the Indenture Trustee. No such resignation by the Master Servicer shall become
effective until the Indenture Trustee or a successor to the Master Servicer
reasonably satisfactory to the Issuer and the Indenture Trustee shall have
assumed the responsibilities and obligations of the Master Servicer in
accordance with Section 6.02 hereof. The Indenture Trustee shall notify each
Rating Agency of the resignation of the Master Servicer.
Section 4.25 Successor Master Servicer.
In connection with the appointment of any successor master servicer or
the assumption of the duties of the Master Servicer, the Indenture Trustee may
make such arrangements for the compensation of such successor master servicer
out of payments on the Mortgage Loans as the Indenture Trustee and such
successor master servicer shall agree which in no case shall exceed the Master
Servicing Fee. If the successor master servicer does not agree that the proposed
compensation is fair, such successor master servicer shall obtain two quotations
of market compensation from third parties actively engaged in the servicing of
single-family mortgage loans; provided, however, that Xxxxxxxxx, as a Servicer
of a substantial portion of the Mortgage Loans, shall have the right, but not
the obligation, to be appointed successor master servicer in the event that the
Indenture Trustee, in its sole discretion, decides not to assume the duties of
the Master Servicer itself; and provided, further, that each Rating Agency shall
confirm in writing that any appointment of a successor Master Servicer (other
than the Indenture Trustee) will not result in a downgrade in the then current
rating of any Class of Notes.
Section 4.26 Sale and Assignment of Master Servicing.
The Master Servicer may sell and assign its rights and delegate its
duties and obligations in their entirety as Master Servicer under this
Agreement, with the written consent of Xxxxxxxxx in its capacity as a Servicer
of a substantial portion of the Mortgage Loans, to be given in its sole
discretion, and provided further that: (i) the purchaser or transferee accepting
such assignment and delegation (a) shall be a Person which shall be qualified to
service mortgage loans for Xxxxxx Mae or Xxxxxxx Mac; (b) shall have a net worth
of not less than $10,000,000 (unless otherwise approved by each Rating Agency
pursuant to clause (ii) below); (c) shall be reasonably satisfactory to
Xxxxxxxxx and the Indenture Trustee (as evidenced in writing signed by Xxxxxxxxx
and the Indenture Trustee); and (d) shall execute and deliver to the Indenture
Trustee an agreement, in form and substance reasonably satisfactory to the
Indenture Trustee, which contains an assumption by such Person of the due and
punctual performance and observance of
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each covenant and condition to be performed or observed by it as master servicer
under this Agreement from and after the effective date of such agreement; (ii)
each Rating Agency shall be given prior written notice of the identity of the
proposed successor to the Master Servicer and each Rating Agency's ratings of
the Notes in effect immediately prior to such assignment, sale and delegation
will not be downgraded, qualified or withdrawn as a result of such assignment,
sale and delegation, as evidenced by a letter to such effect delivered to the
Master Servicer and the Indenture Trustee; and (iii) the Master Servicer
assigning and selling the master servicing shall deliver to the Indenture
Trustee an Officer's Certificate and an Independent Opinion of Counsel,
(delivered at the Master Servicer's expense) each stating that all conditions
precedent to such action under this Agreement have been completed and such
action is permitted by and complies with the terms of this Agreement. No such
assignment or delegation shall affect any liability of the Master Servicer
arising prior to the effective date thereof.
Section 4.27 Determination of LIBOR..
(a) On each LIBOR Determination Date the Master Servicer shall
determine LIBOR on the basis of the provisions of the definition of "LIBOR."
(b) The establishment of LIBOR by the Master Servicer and the Master
Servicer's subsequent calculation of the Note Interest Rates applicable to the
Notes for the relevant Accrual Period, in the absence of manifest error, will be
final and binding. In all cases, absent manifest error, the Master Servicer may
conclusively rely on quotations of LIBOR as such quotations appear on Telerate
Screen Page 3750.
Section 4.28 Realization upon Troubled Mortgage Loans.
The Master Servicer shall have the right, but not the obligation, to
sell or work out (or to cause a Servicer to sell or work out) any Mortgage Loan
as to which the Master Servicer reasonably believes that default in payment is
likely, provided, however, that, with respect to any such sale of a Mortgage
Loan by the Master Servicer or a Servicer, the related sale price shall be no
less than the Scheduled Principal Balance of such Mortgage Loan as of the last
day of the Due Period immediately preceding the date of such sale plus accrued
interest thereon through such sale date. Any and all proceeds from such a sale
shall be deemed to be Liquidation Proceeds hereunder and any such Mortgage Loan
which has been sold shall be deemed a Liquidated Mortgage Loan hereunder.
ARTICLE V
DEPOSITS AND PAYMENTS TO HOLDERS
Section 5.01 Servicing Accounts.
(a) The Master Servicer shall enforce the obligation of each Servicer
to establish and maintain one or more custodial accounts (the "Servicing
Accounts") in accordance with the applicable Servicing Agreement, with records
to be kept with respect thereto on a Mortgage Loan by Mortgage Loan basis, into
which accounts shall be deposited within 48 hours (or as of such other time
specified in the related Servicing Agreement) of receipt all collections of
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principal and interest on any Mortgage Loan and with respect to any REO Property
received by a Servicer, including Principal Prepayments, Insurance Proceeds,
Liquidation Proceeds, amounts received under the Guaranty Surety Bond, and
advances made from the Servicer's own funds (less, in the case of each Servicer,
the applicable servicing compensation, in whatever form and amounts as permitted
by the applicable Servicing Agreement) and all other amounts to be deposited in
each such Servicing Account. The Servicer is hereby authorized to make
withdrawals from and deposits to the related Servicing Account for purposes
required or permitted by this Agreement and the applicable Servicing Agreement.
For the purposes of this Agreement, Servicing Accounts shall also include such
other accounts as the Servicer maintains for the escrow of certain payments,
such as taxes and insurance, with respect to certain Mortgaged Properties. Each
Servicing Agreement sets forth the criteria for the segregation, maintenance and
investment of each related Servicing Account, the contents of which are
acceptable to the parties hereto as of the date hereof and changes to which
shall not be made unless such changes are made in accordance with the provisions
of Section 8.03 hereof.
(b) [Reserved];
(c) To the extent provided in the related Servicing Agreement and
subject to this Article V, on or before each Servicer Remittance Date, each
Servicer shall withdraw or shall cause to be withdrawn from the related
Servicing Accounts and shall immediately deposit or cause to be deposited in the
Collection Account amounts representing the following collections and payments
(other than with respect to principal of or interest on the Mortgage Loans due
on or before the Cut-off Date) with respect to each of the Mortgage Loans it is
servicing:
(i) Monthly Payments on the Mortgage Loans received or
any related portion thereof advanced by the Servicers pursuant to the
Servicing Agreements which were due on or before the related Due Date,
amounts received under the Guaranty Surety Bond but net of the amount
thereof comprising the Servicing Fees;
(ii) Principal Prepayments in full and any Liquidation
Proceeds, Insurance Proceeds or condemnation proceeds received by the
Servicers with respect to such Mortgage Loans in the related Prepayment
Period, with interest to the date of prepayment or liquidation, net of
the amount thereof comprising the Servicing Fees;
(iii) Principal Prepayments in part received by the
Servicers for such Mortgage Loans in the related Prepayment Period;
(iv) Prepayment Penalty Amounts, if any, and only if
required under the related Servicing Agreement; and
(v) any amount to be used as a delinquency advance or to
pay any Interest Shortfalls, in each case, as required to be paid under
the related Servicing Agreement.
(d) Withdrawals may be made from a Servicing Account only to make
remittances as provided in Section 5.01(c), 5.02 and 5.03; to reimburse the
Master Servicer or a Servicer for Advances which have been recovered by
subsequent collection from the related Mortgagor; to remove amounts deposited in
error; to remove fees, charges or other such amounts deposited on
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a temporary basis; or to clear and terminate the account at the termination of
this Agreement in accordance with Section 7.01. As provided in Sections 5.01(c)
and 5.02(b), certain amounts otherwise due to the Servicers may be retained by
them and need not be deposited in the Collection Account.
Section 5.02 Collection Account.
(a) The Master Servicer shall establish and maintain an account, in the
name of the Securities Intermediary, for the benefit of the Indenture Trustee
and the Securityholders, as a segregated account which shall be an Eligible
Account (the "Collection Account"). The Master Servicer will deposit in the
Collection Account as identified by the Master Servicer and as received by the
Master Servicer, the following amounts:
(i) any amounts withdrawn from a Servicing Account
pursuant to Section 5.01(c);
(ii) any Advance and any Compensating Interest Payments
required to be made by the Master Servicer to the extent required but
not made by a Servicer;
(iii) any Insurance Proceeds or Liquidation Proceeds
received by or on behalf of the Master Servicer or which were not
deposited in a Servicing Account;
(iv) the Purchase Price with respect to any Mortgage Loans
purchased by the Seller under this Agreement, any Substitution
Adjustments pursuant to Section 3.03 of this Agreement, the Purchase
Price with respect to any Mortgage Loans purchased by Xxxxxxxxx or TMI,
as applicable, pursuant to Section 4.18, and all proceeds of any
Mortgage Loans or property acquired with respect thereto repurchased by
Xxxxxxxxx pursuant to Section 7.03;
(v) any amounts required to be deposited with respect to
losses on investments of deposits in the Collection Account pursuant to
Section 5.02(c); and
(vi) any other amounts received by or on behalf of the
Master Servicer or the Indenture Trustee and required to be deposited
in the Collection Account pursuant to this Agreement.
(b) All amounts deposited to the Collection Account shall be held by
the Master Servicer in accordance with the terms and provisions of this
Agreement. The requirements for crediting the Collection Account or the Note
Account shall be exclusive, it being understood and agreed that, without
limiting the generality of the foregoing, payments in the nature of (i) late
payment charges or assumption, tax service, statement account or payoff,
substitution, satisfaction, release and other like fees and charges (but
excluding all Prepayment Penalty Amounts) and (ii) the items enumerated in
Subsections 5.03(a)(i), (ii), (iii), (iv), (vi), (vii), (ix) and (x) with
respect to the Master Servicer, need not be credited by the Master Servicer or
the related Servicer to the Note Account or the Collection Account, as
applicable. In the event that the Master Servicer shall deposit or cause to be
deposited to the Note Account any amount not required to be credited thereto,
the Indenture Trustee, upon receipt of a written request therefor signed by a
Servicing
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Officer of the Master Servicer, shall promptly transfer such amount to the
Master Servicer, any provision herein to the contrary notwithstanding.
(c) The amount at any time credited to the Collection Account shall be
invested, in the name of the Indenture Trustee, or its nominee, for the benefit
of the Securityholders, in Permitted Investments as follows. All Permitted
Investments shall be for the benefit of Xxxxxxxxx, in its capacity as Servicer,
except that the investment income with respect to the investment of funds in the
Collection Account made on the Business Day prior to the Master Servicer
Remittance Date shall be for the benefit of the Master Servicer. All Permitted
Investments made for the benefit of Xxxxxxxxx shall be made at the written
direction of Xxxxxxxxx to the Master Servicer (or, if no such written direction
is received, in investments of the type specified in clause (vi) of the
definition of Permitted Investments), shall mature or be subject to redemption
or withdrawal on or before, and shall be held until, the Business Day prior to
the next succeeding Master Servicer Remittance Date. Any and all investment
earnings from such Permitted Investments shall be paid to Xxxxxxxxx, and the
risk of loss of moneys resulting from such investments shall be borne by and be
the risk of Xxxxxxxxx. Xxxxxxxxx shall deposit the amount of any such loss in
the Collection Account within two Business Days of receipt of notification of
such loss but not later than the next succeeding Master Servicer Remittance
Date.
All Permitted Investments for the benefit of the Master Servicer shall
be in such Permitted Investments as shall be selected by the Master Servicer and
shall mature (and be subject to withdrawal and be held until) the next
succeeding Master Servicer Remittance Date. Any and all investment earnings from
such Permitted Investments shall be paid to the Master Servicer and the risk of
loss on such Permitted Investments shall be borne by and be the risk of the
Master Servicer. The Master Servicer shall deposit the amount of any such loss
in the Collection Account no later than the next succeeding Master Servicer
Remittance Date.
Section 5.03 Permitted Withdrawals and Transfers from the Collection
Account.
(a) The Master Servicer will, from time to time on demand of a
Servicer, or for its own account as set forth below, make or cause to be made
such withdrawals or transfers from the Collection Account, in the case of a
demand by a Servicer, as the applicable Servicer has designated for such
transfer or withdrawal pursuant to the applicable Servicing Agreement, or as the
Master Servicer has determined to be appropriate in accordance herewith, for the
following purposes:
(i) to reimburse the Master Servicer or any Servicer for
any Advance of its own funds or of such Servicer's own funds, the right
of the Master Servicer or a Servicer to reimbursement pursuant to this
subclause (i) being limited to amounts received on a particular
Mortgage Loan (including, for this purpose, the Purchase Price
therefor, Insurance Proceeds and Liquidation Proceeds) which represent
late payments or recoveries of the principal of or interest on such
Mortgage Loan respecting which such Advance was made;
(ii) to reimburse the Master Servicer or any Servicer from
Insurance Proceeds or Liquidation Proceeds relating to a particular
Mortgage Loan for amounts expended by the Master Servicer or such
Servicer in good faith in connection with the restoration of
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the related Mortgaged Property which was damaged by an Uninsured Cause
or in connection with the liquidation of such Mortgage Loan;
(iii) to reimburse the Master Servicer or any Servicer from
Insurance Proceeds relating to a particular Mortgage Loan for insured
expenses incurred with respect to such Mortgage Loan and to reimburse
the Master Servicer or such Servicer from Liquidation Proceeds from a
particular Mortgage Loan for Liquidation Expenses incurred with respect
to such Mortgage Loan;
(iv) to pay the Master Servicer or any Servicer, as
appropriate, from Liquidation Proceeds or Insurance Proceeds received
in connection with the liquidation of any Mortgage Loan, the amount
which it or such Servicer would have been entitled to receive under
subclause (ix) of this Subsection 5.03(a) as servicing compensation on
account of each defaulted scheduled payment on such Mortgage Loan if
paid in a timely manner by the related Mortgagor;
(v) to pay the Master Servicer or any Servicer from the
Purchase Price for any Mortgage Loan, the amount which it or such
Servicer would have been entitled to receive under subclause (ix) of
this Subsection (a) as servicing compensation;
(vi) to reimburse the Master Servicer or any Servicer for
servicing related advances of funds, the right to reimbursement
pursuant to this subclause being limited to amounts received on the
related Mortgage Loan (including, for this purpose, the Purchase Price
therefor, Insurance Proceeds and Liquidation Proceeds) which represent
late recoveries of the payments for which such servicing advances were
made;
(vii) to reimburse the Master Servicer or any Servicer for
any Advance or advance, after a Realized Loss has been allocated with
respect to the related Mortgage Loan if the Advance or advance has not
been reimbursed pursuant to clauses (i) and (vi);
(viii) to pay the Master Servicer its monthly Master
Servicing Fee and any investment income and other additional servicing
compensation payable pursuant to Section 4.12;
(ix) to reimburse the Master Servicer for any expenses
recoverable by the Master Servicer pursuant to Sections 4.02 and 4.23;
(x) to reimburse or pay any Servicer any such amounts as
are due thereto under the applicable Servicing Agreement and have not
been retained by or paid to the Servicer, to the extent provided in the
related Servicing Agreement;
(xi) to remove amounts deposited in error; and
(xii) to clear and terminate the Collection Account
pursuant to Section 7.01.
(b) In addition, on or before each Master Servicer Remittance Date, the
Master Servicer shall deposit in the Note Account (or remit to the Indenture
Trustee for deposit therein) any
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Advances or Compensating Interest Payments, to the extent required but not made
by the related Servicer and required to be made by the Master Servicer with
respect to the Mortgage Loans.
(c) The Master Servicer shall keep and maintain separate accounting, on
a Mortgage Loan by Mortgage Loan basis, for the purpose of accounting for any
payments or reimbursements from the Collection Account pursuant to subclauses
(i) through (vii), inclusive, (ix) and (x) or with respect to any such amounts
which would have been covered by such subclauses had the amounts not been
retained by the Master Servicer without being deposited in the Note Account
under Section 5.02(b), and to allow the Master Servicer to calculate the amount
of the Indenture Trustee Fee due the Indenture Trustee on the related Payment
Date.
(d) No later than 3:00 p.m. New York time on each Master Servicer
Remittance Date, the Master Servicer will transfer the Interest Remittance
Amount, any Prepayment Penalty Amounts and the Principal Remittance Amount
(which shall include any Indenture Trustee Fees) on deposit in the Collection
Account net of the Master Servicing Fee and any other amounts previously
withdrawn pursuant to Section 5.03(a) with respect to the related Payment Date
to the Indenture Trustee for deposit in the Note Account.
Section 5.04 The Note Account.
(a) The Indenture Trustee shall establish and maintain, in the name of
the Securities Intermediary, as a segregated account which shall be an Eligible
Account (the "Note Account") for the benefit of the Securityholders and the
Indenture Trustee. If the existing Note Account ceases to be an Eligible
Account, the Indenture Trustee shall establish a new Note Account that is an
Eligible Account within 20 Business Days and transfer all funds and investment
property on deposit in such existing Note Account into such new Note Account.
The Note Account shall relate solely to the Notes issued hereunder and funds in
the Note Account shall be held separate and apart from and shall not be
commingled with any other monies including, without limitation, other monies of
the Indenture Trustee held under this Agreement.
(b) On each Master Servicer Remittance Date, the Indenture Trustee
shall deposit amounts received from the Master Servicer pursuant to Section
5.03(d) or cause to be deposited into the Note Account on the Business Day
immediately following the day on which amounts are remitted by the Master
Servicer to the Indenture Trustee pursuant to Section 5.03(d) or otherwise. The
Indenture Trustee shall make withdrawals from the Note Account only for the
following purposes:
(i) to return to the Master Servicer or the applicable
Servicer, any amounts which should have been withdrawn from the
Collection Account pursuant to Section 5.02(a);
(ii) to pay the itself its monthly Indenture Trustee Fee;
(iii) to reimburse the Indenture Trustee, the Owner Trustee
and the Master Servicer for expenses, costs and liabilities incurred by
or reimbursable to it pursuant to Sections 4.23 or as otherwise
provided in this Agreement;
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(iv) to make distributions of Retained Interest to the
Retained Interest Holder on each Payment Date;
(v) to remove amounts deposited in error;
(vi) to make payments on the Notes and to the Certificate
Account as contemplated by Section 5.06 and 5.08, respectively; and
(vii) to clear and terminate the Note Account pursuant to
Section 7.01.
The Indenture Trustee may invest, or cause to be invested, funds held
in the Note Account at the direction of the Xxxxxxxxx (which may be standing
instructions), in its capacity as a Servicer, which funds, if invested, shall be
invested in Permitted Investments (which may be obligations of the Indenture
Trustee). All such investments must be payable on demand or mature on or before
the next Payment Date if the obligor of such Permitted Investment is the
Indenture Trustee or, if the obligor is any other Person, no later than the
Business Day preceding such Payment Date. All such Permitted Investments will be
made in the name of the Indenture Trustee (in its capacity as such) or its
nominee. All income and gain realized from any such investment shall be for the
benefit of the Xxxxxxxxx as additional compensation in connection with its
capacity as a Servicer and shall be subject to withdrawal on order from time to
time and shall not be part of the Trust Estate. The amount of any losses
incurred in respect of any such investments shall be paid by Xxxxxxxxx for
deposit in the Note Account out of its own funds, without any right of
reimbursement therefor, immediately as realized. In the event Xxxxxxxxx does not
provide written direction to the Indenture Trustee pursuant to this Section, all
funds on deposit in the Note Account shall remain uninvested.
The Indenture Trustee or its Affiliates are permitted to receive
additional compensation that could be deemed to be in the Indenture Trustee's
economic self-interest for (i) serving as investment adviser, administrator,
shareholder, servicing agent, custodian or sub-custodian with respect to certain
of the Permitted Investments, (ii) using Affiliates to effect transactions in
certain Permitted Investments and (iii) effecting transactions in certain
Permitted Investments. Such compensation shall not be payable or reimbursable
under this Agreement.
Section 5.05 Yield Maintenance Account..
The Indenture Trustee shall establish and maintain an account, for the
benefit of the Indenture Trustee and the Noteholders, as a segregated account
which shall be an Eligible Account (the "Yield Maintenance Account"). Pursuant
to each Yield Maintenance Agreement, the Yield Maintenance Provider shall have
provided the Indenture Trustee and the Master Servicer with notice of the Yield
Maintenance Payment, if any, to be made pursuant to such Yield Maintenance
Agreement for each Payment Date. Yield Maintenance Payments distributed to the
Indenture Trustee pursuant to the Yield Maintenance Agreements in connection
with each such Payment Date shall be deposited into the Yield Maintenance
Account and distributed on each Payment Date, as follows:
(a) first, concurrently, to the Class A-1 Noteholders and Class A-2
Noteholders, pro rata, based on the amount of interest each such Class is
entitled to under this Section 5.05(a), the
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lesser of (1) the amount received under the Yield Maintenance Agreements, and
(2) the amount of Current Interest that each such Class would have been entitled
to receive on such Payment Date had the applicable Note Interest Rate been
calculated at the lesser of (A) One-Month LIBOR plus the applicable Margin for
the related Accrual Period and (B) 11.50%, to the extent not otherwise paid from
the Interest Remittance Amount;
(b) second, to the Class M-1 Noteholders, the lesser of (1) the amount
received under the Yield Maintenance Agreements less any amount paid pursuant to
Section 5.05(a) on such Payment Date, and (2) the amount of Current Interest
that such Class would have been entitled to receive on such Payment Date had the
applicable Note Interest Rate been calculated at the lesser of (A) One-Month
LIBOR plus 0.65% for the related Accrual Period and (B) 11.50%, to the extent
not otherwise paid from the Interest Remittance Amount;
(c) third, to the Class M-2 Noteholders, the lesser of (1) the amount
received under the Yield Maintenance Agreements less any amount paid pursuant to
Sections 5.05(a) and (b) on such Payment Date, and (2) the amount of Current
Interest that such Class would have been entitled to receive on such Payment
Date had the applicable Note Interest Rate been calculated at the lesser of (A)
One-Month LIBOR plus 1.70% for the related Accrual Period and (B) 11.50%, to the
extent not otherwise paid from the Interest Remittance Amount;
In the event that the amount received by the Indenture Trustee with
respect to the Yield Maintenance Agreements for any Payment Date exceeds the
amounts required to pay the related Noteholders under subclause (2) of clauses
(a) through (c) above on such Payment Date, such excess amount will constitute
the "Excess Yield Maintenance Amount" and will be released from the lien of this
Indenture deposited by the Indenture Trustee into the Certificate Account for
distribution on the Trust Certificate.
Upon termination of all three Yield Maintenance Agreements and payment
of all amounts owed by the Yield Maintenance Provider thereunder, following
application by the Indenture Trustee of funds in the Yield Maintenance Account
on the next succeeding Payment Date to pay amounts owed pursuant to clauses (a)
through (c) of this Section and Section 5.06, the Indenture Trustee shall
terminate the Yield Maintenance Account.
Section 5.06 Payments from the Note Account.
(a) On each Payment Date the Indenture Trustee (or the Paying Agent on
behalf of the Indenture Trustee) shall make payments from amounts in the Note
Account in accordance with this Section 5.06.
(b) On each Payment Date, the Indenture Trustee shall pay the Interest
Remittance Amount for such date in the following order of priority in accordance
with the report of the Master Servicer provided to the Indenture Trustee no
later than one Business Day prior to each Payment Date:
(i) concurrently, to the Class A-1 and Class A-2 Notes,
Current Interest and any Carryforward Interest for each such Class and
such Payment Date, pro rata on the
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basis of the amount of such interest each such Class is entitled to
receive on such Payment Date;
(ii) to the Class M-1 Notes, Current Interest for such
Class and such Payment Date;
(iii) to the Class M-2 Notes, Current Interest for such
Class and such Payment Date;
(iv) any Interest Remittance Amount remaining after
application pursuant to clauses (i) through (iii) above for application
as Monthly Excess Interest for such Payment Date as provided in
subsection (d) of this Section.
(c) On each Payment Date, the Indenture Trustee shall pay the Principal
Distribution Amount for such date in accordance with the report of the Master
Servicer provided to the Indenture Trustee no later than one Business Day prior
to each Payment Date, to each Class of Notes, concurrently, in proportion to
their respective Class Principal Amounts immediately prior to such Payment Date,
until the Class Principal Amounts thereof are reduced to zero;
(d) On each Payment Date, the Indenture Trustee shall pay the Monthly
Excess Interest for such date in accordance with the report of the Master
Servicer provided to the Indenture Trustee no later than one Business Day prior
to each Payment Date in the following order of priority:
(i) for each Payment Date for which there is an
Overcollateralization Deficiency, to fund the Extra Principal
Distribution Amount portion of the Principal Distribution Amount for
such Payment Date and be paid as principal pursuant to subclause (c)
above;
(ii) to the Class A-1 and Class A-2 Notes, concurrently
any unpaid Carryforward Interest due and owing to the Class A-1 and
Class A-2 Notes pro rata based on the amount of the Carryforward
Interest due to such classes;
(iii) to the Class M-1 Notes, any Carryforward Interest for
such Class and such Payment Date;
(iv) to the Class M-2 Notes, any Carryforward Interest for
such Class and such Payment Date;
(v) to the Class A-2 Notes, any Deferred Amount for such
Class and such Payment Date;
(vi) to the Class M-1 Notes, any Deferred Amount for such
Class and such Payment Date;
(vii) to the Class M-2 Notes, any Deferred Amount for such
Class and such Payment Date;
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(viii) to the Class A-1 and Class A-2 Notes, concurrently
any Net WAC Shortfall Carryforward Amount for such Classes and such
Payment Date pro rata based on the amount of Net WAC Shortfall
Carryforward Amount due to such classes;
(ix) to the Class M-1 Notes, any Net WAC Shortfall
Carryforward Amount for such Class and such Payment Date;
(x) to the Class M-2 Notes, any Net WAC Shortfall
Carryforward Amount for such Class and such Payment Date;
(xi) to the Master Servicer, the Indenture Trustee, the
Custodian, the Owner Trustee and the Administrator, any amounts
reimbursable pursuant to the Operative Agreements and not previously
reimbursed to such parties; and
(xii) to the Certificate Account, for distribution in
accordance with Section 5.08.
(e) On each Payment Date, the Indenture Trustee shall pay any
Prepayment Penalty Amounts to the Certificate Account for distribution in
accordance with Section 5.08.
Section 5.07 Allocation of Losses and Net Interest Shortfalls.
(a) On each Payment Date, the Class Principal Amounts of the Class M-1,
Class M-2 and Class A-2 Notes will be reduced by the amount of any Applied Loss
Amount for such date, in the following order of priority:
(i) to the Class M-2 Notes, until the Class Principal
Amount thereof has been reduced to zero;
(ii) to the Class M-1 Notes, until the Class Principal
Amount thereof has been reduced to zero; and
(iii) to the Class A-2 Notes, until the Class Principal
Amount thereof has been reduced to zero.
(b) On each Payment Date, Net Interest Shortfalls will be allocated to
the Current Interest payable to the Notes in the following order of priority:
(i) to the Class M-2 Notes, until the Current Interest
for such Payment Date for such Class has been reduced to zero;
(ii) to the Class M-1 Notes, until the Current Interest
for such Payment Date for such Class has been reduced to zero; and
(iii) concurrently, to the Class A-1 and Class A-2 Notes,
pro rata, based on the amount of Current Interest each such Class is
otherwise entitled to receive, until the Current Interest for such
Payment Date for such Classes has been reduced to zero;
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Section 5.08 The Certificate Account. (a) The Administrator, for the
benefit of the Certificateholders, shall establish and maintain in the name of
the Owner Trustee on behalf of the Certificateholders an account (the
"Certificate Account") entitled "Certificate Account, Wilmington Trust Company,
as Owner Trustee, in trust for the Holders of Xxxxxxxxx Mortgage Securities
Trust 2003-4 Trust Certificates, Series 2003-4."
(b) On each Payment Date, the Indenture Trustee shall withdraw from the
Note Account all amounts required to be deposited in the Certificate Account
pursuant to Section 5.06 and remit such amount to the Owner Trustee or the
Administrator for deposit into the Certificate Account. On each Payment Date,
the Owner Trustee or the Administrator shall distribute all amounts on deposit
in the Certificate Account to the Certificateholders in respect of the Trust
Certificate. On the Payment Date on which the Class Principal Amount of the
Notes is reduced to zero, the Administrator shall distribute all amounts
remaining on deposit in the Certificate Account to the Certificateholders in
respect of the Trust Certificate in order to clear and terminate the Certificate
Account in connection with the termination of this Agreement.
(c) All distributions made on the Trust Certificate shall be made by
wire transfer of immediately available funds to the account of such
Certificateholder. The final distribution on the Trust Certificate will be made
in like manner, but only upon presentment and surrender of such Trust
Certificate at the location specified in the notice to the Certificateholder of
such final distribution.
Section 5.09 Control of the Trust Accounts.
(a) The Depositor, the Issuer and the Indenture Trustee hereby appoint
Deutsche Bank National Trust Company as Securities Intermediary with respect to
the Trust Accounts and the Certificate Account, and the Issuer has, pursuant to
the Indenture, granted to the Indenture Trustee, for the benefit of the
Securityholders, a security interest to secure all amounts due Securityholders
hereunder in and to the Trust Accounts and the Security Entitlements to all
Financial Assets credited to the Trust Accounts, including without limitation
all amounts, securities, investments, Financial Assets, investment property and
other property from time to time deposited in or credited to the Trust Accounts
and all proceeds thereof. Amounts held from time to time in the Trust Accounts
will continue to be held by the Securities Intermediary for the benefit of the
Indenture Trustee, as collateral agent, for the benefit of the Securityholders,
and amounts held from time to time in the Certificate Account will continue to
be held by the Securities Intermediary for the benefit of the Issuer, as
collateral agent, for the benefit of the Certificateholders. Upon the
termination of the Issuer or the discharge of the Indenture, the Indenture
Trustee shall inform the Securities Intermediary of such termination. By
acceptance of their Securities or interests therein, the Securityholders shall
be deemed to have appointed Deutsche Bank National Trust Company as Securities
Intermediary. Deutsche Bank National Trust Company hereby accepts such
appointment as Securities Intermediary;
(b) With respect to the Trust Account Property credited to the Trust
Accounts or the Certificate Account, the Securities Intermediary agrees that:
(i) with respect to any Trust Account Property that is
held in deposit accounts, each such deposit account shall be subject to
the exclusive custody and control
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of the Securities Intermediary, and the Securities Intermediary shall
have sole signature authority with respect thereto;
(ii) all assets in the Trust Accounts and the Certificate
Account are agreed by the Securities Intermediary to be treated as
Financial Assets; and
(iii) any such Trust Account Property that is, or is
treated as, a Financial Asset shall be physically delivered
(accompanied by any required endorsements) to, or credited to an
account in the name of, the Securities Intermediary or other eligible
institution maintaining any Trust Accounts or the Certificate Account
in accordance with the Securities Intermediary's customary procedures
such that the Securities Intermediary or such other institution
establishes a Security Entitlement in favor of the Indenture Trustee
(or the Issuer, in the case of the Certificate Account) with respect
thereto over which the Securities Intermediary or such other
institution has Control;
(c) The Securities Intermediary hereby confirms that (A) each Trust
Account and the Certificate Account are accounts to which Financial Assets are
or may be credited, and the Securities Intermediary shall, subject to the terms
of this Agreement, treat the Indenture Trustee, as collateral agent, as entitled
to exercise the rights that comprise any Financial Asset credited to any Trust
Account, and the Issuer, as collateral agent, as entitled to exercise the rights
that comprise any Financial Asset credited to the Certificate Account, (B) all
Trust Account Property in respect of any Trust Account or the Certificate
Account will be promptly credited by the Securities Intermediary to the
applicable account, and (C) all securities or other property underlying any
Financial Assets credited to any Trust Account or the Certificate Account shall
be registered in the name of the Securities Intermediary, endorsed to the
Securities Intermediary or in blank or credited to another securities account
maintained in the name of the Securities Intermediary and in no case (x) will
any Financial Asset credited to any Trust Account be registered in the name of
the Depositor or the Issuer, payable to the order of the Depositor or the Issuer
or specially endorsed to the Depositor or the Issuer, or (y) will any Financial
Asset credited to the Certificate Account be registered in the name of the
Depositor, payable to the order of the Depositor or specially endorsed to the
Depositor, except to the extent the foregoing have been specially endorsed to
the Securities Intermediary or in blank;
(d) The Securities Intermediary hereby agrees that each item of
property (whether investment property, Financial Asset, security, instrument or
cash) credited to any Trust Account or the Certificate Account shall be treated
as a Financial Asset;
(e) If at any time the Securities Intermediary shall receive an
Entitlement Order from the Indenture Trustee directing transfer or redemption of
any Financial Asset relating to any Trust Account, the Securities Intermediary
shall comply with such Entitlement Order without further consent by the
Depositor, the Issuer or any other Person. If at any time the Indenture Trustee
notifies the Securities Intermediary in writing that the Issuer has been
terminated or the Indenture discharged in accordance herewith and with the Trust
Agreement or the Indenture, as applicable, and the security interest granted
pursuant to the Indenture has been released, then thereafter if the Securities
Intermediary shall receive any order from the Depositor or the Issuer directing
transfer or redemption of any Financial Asset relating to any Trust Account, the
Securities Intermediary
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shall comply with such Entitlement Order without further consent by the
Indenture Trustee or any other Person;
If at any time the Securities Intermediary shall receive an Entitlement
Order from the Issuer directing transfer or redemption of any Financial Asset
relating to the Certificate Account, the Securities Intermediary shall comply
with such Entitlement Order without further consent by the Depositor or any
other Person;
(f) In the event that the Securities Intermediary has or subsequently
obtains by agreement, operation of law or otherwise a security interest in any
Trust Account or the Certificate Account or any Financial Asset credited
thereto, the Securities Intermediary hereby agrees that such security interest
shall be subordinate to the security interest of the Indenture Trustee, in the
case of the Trust Accounts, or of the Issuer, in the case of the Certificate
Account. The Financial Assets credited to the Trust Accounts, or the Certificate
Account will not be subject to deduction, set-off, banker's lien, or any other
right in favor of any Person other than the Indenture Trustee in the case of the
Trust Accounts, or of the Issuer, in the case of the Certificate Account (except
that the Securities Intermediary may set-off (i) all amounts due to it in
respect of its customary fees and expenses for the routine maintenance and
operation of the Trust Accounts, and the Certificate Account, and (ii) the face
amount of any checks which have been credited to any Trust Account or the
Certificate Account but are subsequently returned unpaid because of uncollected
or insufficient funds);
(g) There are no other agreements entered into between the Securities
Intermediary in such capacity and the Depositor or the Issuer with respect to
any Trust Account, or the Depositor or the Issuer with respect to the
Certificate Account. In the event of any conflict between this Agreement (or any
provision of this Agreement) and any other agreement now existing or hereafter
entered into, the terms of this Agreement shall prevail;
(h) The rights and powers granted under the Indenture and herein to (x)
the Indenture Trustee have been granted in order to perfect its security
interest in the Trust Accounts and the Security Entitlements to the Financial
Assets credited thereto, and (y) the Issuer have been granted in order to
perfect its security interest in the Certificate Account and the Security
Entitlements to the Financial Assets credited thereto, and are powers coupled
with an interest and will neither be affected by the bankruptcy of the Depositor
or the Issuer nor by the lapse of time. The obligations of the Securities
Intermediary hereunder shall continue in effect until the security interest of
the Indenture Trustee in the Trust Accounts or of the Issuer in the Certificate
Account, and in such Security Entitlements, has been terminated pursuant to the
terms of this Agreement and the Indenture Trustee or the Issuer, as applicable,
has notified the Securities Intermediary of such termination in writing; and
(i) Notwithstanding anything else contained herein, the Depositor and
the Issuer agree that the Trust Accounts and the Certificate Account will be
established only with the Securities Intermediary or another institution meeting
the requirements of this Section, which by acceptance of its appointment as
Securities Intermediary agrees substantially as follows: (1) it will comply with
Entitlement Orders related to the Trust Accounts issued by the Indenture
Trustee, as collateral agent, without further consent by the Depositor or the
Issuer, and with Entitlement Orders related to the Certificate Account issued by
the Issuer, as collateral agent,
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without further consent by the Depositor; (2) until termination of the Trust or
discharge of the Indenture, it will not enter into any other agreement related
to such accounts pursuant to which it agrees to comply with Entitlement Orders
of any Person other than the Indenture Trustee, as collateral agent with respect
to the Trust Accounts or the Issuer, as collateral agent with respect to the
Certificate Account; and (3) all assets delivered or credited to it in
connection with such accounts and all investments thereof will be promptly
credited to the applicable account.
(j) Notwithstanding the foregoing, the Issuer shall have the power to
instruct the Indenture Trustee to make withdrawals and distributions from the
Trust Accounts for the purpose of permitting the Indenture Trustee to carry out
its duties under the Indenture.
(k) The Issuer agrees to take or cause to be taken such further
actions, to execute, deliver and file or cause to be executed, delivered and
filed such further documents and instruments (including, without limitation, any
financing statements under the Relevant UCC or this Agreement) as may be
necessary to perfect the interests created by this Section in favor of the
Issuer and the Indenture Trustee and otherwise fully to effectuate the purposes,
terms and conditions of this Section. The Issuer shall:
(i) promptly execute, deliver and file any financing
statements, amendments, continuation statements, assignments,
certificates and other documents with respect to such interests and
perform all such other acts as may be necessary in order to perfect or
to maintain the perfection of the Issuer's and the Indenture Trustee's
security interest in the Trust Account Property; and
(ii) make the necessary filings of financing statements or
amendments thereto within five days after the occurrence of any of the
following: (1) any change in its corporate name or any trade name or
its jurisdiction of organization; (2) any change in the location of its
chief executive office or principal place of business; and (3) any
merger or consolidation or other change in its identity or corporate
structure and promptly notify the Issuer and the Indenture Trustee of
any such filings.
(iii) Neither the Depositor nor the Issuer shall organize
under the law of any jurisdiction other than the State under which each
is organized as of the Closing Date (whether changing its jurisdiction
of organization or organizing under an additional jurisdiction) without
giving 30 days prior written notice of such action to its immediate
transferee, including the Indenture Trustee. Before effecting such
change, each of the Depositor or the Issuer proposing to change its
jurisdiction of organization shall prepare and file in the appropriate
filing office any financing statements or other statements necessary to
continue the perfection of the interests of its immediate transferees,
including the Indenture Trustee, in the Trust Account Property. In
connection with the transactions contemplated by the Operative
Agreements relating to the Trust Account Property, each of the
Depositor and the Issuer authorizes its immediate transferee, including
the Indenture Trustee, to file in any filing office any initial
financing statements, any amendments to financing statements, any
continuation statements, or any other statements or filings described
in this Section 5.09.
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None of the Securities Intermediary or any director, officer, employee
or agent of the Securities Intermediary shall be under any liability to the
Indenture Trustee or the Securityholders or any other person or for any action
taken, or not taken, in good faith pursuant to this Agreement, or for errors in
judgment; provided, however, that this provision shall not protect the
Securities Intermediary against any liability to the Indenture Trustee, the
Issuer or the Securityholders which would otherwise be imposed by reason of the
Securities Intermediary's willful misconduct, bad faith or negligence in the
performance of its obligations or duties hereunder. The Securities Intermediary
and any director, officer, employee or agent of the Securities Intermediary may
rely in good faith on any document of any kind which, prima facie, is properly
executed and submitted by any Person respecting any matters arising hereunder.
The Securities Intermediary shall be under no duty to inquire into or
investigate the validity, accuracy or content of such document. The Issuer shall
indemnify the Securities Intermediary for and hold it harmless against any loss,
liability or expense arising out of or in connection with this Agreement and
carrying out its duties hereunder, including the costs and expenses of defending
itself against any claim of liability, except in those cases where the
Securities Intermediary has been guilty of bad faith, negligence or willful
misconduct. The foregoing indemnification shall survive any termination of this
Agreement or the resignation or removal of the Securities Intermediary.
The Securities Intermediary shall be entitled to all of the
protections, immunities, benefits and indemnities afforded to the Indenture
Trustee under Article VI of the Indenture.
Section 5.10 Statements.
(a) Not later than 5:00 p.m. one Business Day prior to each Payment
Date, the Master Servicer shall make available to the Indenture Trustee and the
Yield Maintenance Provider, and concurrently with each distribution to
Securityholders, the Master Servicer shall make available to each
Securityholder, the Seller, the Owner Trustee and each Rating Agency, a
statement based solely on loan-level information provided to it by the Servicers
(the "Payment Date Statement") as to the distributions to be made or made, as
applicable, on such Payment Date. Information in the Payment Date Statement
relating to or based on amounts available in the Yield Maintenance Account shall
be based on information provided by the Yield Maintenance Provider regarding
distributions to be made for the related Payment Date pursuant to the Yield
Maintenance Agreements. The Indenture Trustee shall confirm to the Master
Servicer receipt of such amounts in the Yield Maintenance Account on the
Business Day immediately preceding such Payment Date. The Payment Date Statement
will include the following:
(i) the aggregate amount of the payment to be made on
such Payment Date to the Holders of each Class of Notes, to the extent
applicable, allocable to principal;
(ii) the aggregate amount of the payment to be made on
such Payment Date to the Holders of each Class of Notes allocable to
interest and the calculation thereof;
(iii) the amount, if any, of any distribution to the
Holders of the Trust Certificate;
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(iv) (A) the aggregate amount of any Monthly Advances
required to be made by or on behalf of the Servicers (or the Master
Servicer) with respect to such Payment Date, (B) the aggregate amount
of such Monthly Advances actually made, and (C) the amount, if any, by
which (A) above exceeds (B) above;
(v) the total number of Mortgage Loans in the aggregate
and the aggregate Scheduled Principal Balance, after giving effect to
payments of principal reported under clause (i) above, in the aggregate
and separately for each of Five-Year, Seven-Year and Ten-Year Hybrid
Mortgage Loans, in each case at the close of business at the end of the
related Due Period and the Net WAC Rate for such Payment Date;
(vi) the Class Principal Amount of each Class of Notes, to
the extent applicable, as of such Payment Date after giving effect to
payments allocated to principal reported under clause (i) above,
separately identifying any reduction of any of the foregoing Note
Principal Amounts due to Applied Loss Amounts;
(vii) the amount of any Realized Losses incurred with
respect to the Mortgage Loans (x) in the applicable Prepayment Period
and (y) in the aggregate since the Cut-off Date;
(viii) the amount of the Master Servicing Fees, Servicing
Fees and Indenture Trustee Fees, if any, paid during the Due Period to
which such distribution relates;
(ix) the number and aggregate Scheduled Principal Balance
of Mortgage Loans, (a) delinquent 30 to 59 days on a contractual basis,
(b) delinquent 60 to 89 days on a contractual basis, (c) delinquent 90
or more days on a contractual basis, (d) as to which foreclosure
proceedings have been commenced in the month in which such Payment Date
occurs, in each case as of the close of business on the last Business
Day of the calendar month immediately preceding, (e) in bankruptcy and
(f) that are REO Properties;
(x) the aggregate Scheduled Principal Balance of any
Mortgage Loans with respect to which the related Mortgaged Property
became a REO Property as of the close of business on the last Business
Day of the calendar month immediately preceding the month in which such
Payment Date occurs;
(xi) with respect to substitution of Mortgage Loans in the
preceding calendar month, the Scheduled Principal Balance of each
Deleted Mortgage Loan, and of each Qualified Substitute Mortgage Loan;
(xii) the aggregate outstanding Carryforward Interest and
Net WAC Shortfall Carryforward Amounts, if any, for each Class of
Notes, after giving effect to payments made on such Payment Date;
(xiii) the Note Interest Rate applicable to such Payment
Date with respect to each Class of Notes;
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(xiv) the Interest Remittance Amount and the Principal
Remittance Amount applicable to such Payment Date;
(xv) the Overcollateralization Amount, the
Overcollateralization Deficiency, if any, the Principal Distribution
Amount and the Extra Principal Distribution Amount for such Payment
Date; and
(xvi) the level of LIBOR; any Yield Maintenance Payments
made for such period, the notional balances on each Yield Maintenance
Agreement and the Excess Yield Maintenance Amount for such Payment
Date.
In the case of information furnished pursuant to subclauses (i), (ii)
and (vi) above, the amounts shall also be expressed as a dollar amount per
$1,000 of original principal amount of Notes.
The Master Servicer will make the Payment Date Statement (and, at its
option, any additional files containing the same information in an alternative
format) available each month to Securityholders and the other parties to this
Agreement via the Master Servicer's internet website. The Master Servicer's
internet website shall initially be located at "xxx.xxxxxxx.xxx." Assistance in
using the website can be obtained by calling the Master Servicer's customer
service desk at (000) 000-0000. Parties that are unable to use the above
distribution option are entitled to have a paper copy mailed to them via first
class mail by calling the customer service desk and indicating such. The Master
Servicer shall have the right to change the way such reports are distributed in
order to make such distribution more convenient and/or more accessible to the
parties, and the Master Servicer shall provide timely and adequate notification
to all parties regarding any such change.
(b) Within a reasonable period of time after the end of each calendar
year, the Indenture Trustee shall, upon written request, furnish to each Person
who at any time during the calendar year was a Securityholder, if requested in
writing by such Person, such information as is reasonably necessary to provide
to such Person a statement containing aggregate payment information necessary to
enable Holders of the Securities to prepare their tax returns. Such obligation
of the Indenture Trustee shall be deemed to have been satisfied to the extent
that substantially comparable information shall be prepared and furnished by the
Indenture Trustee to Securityholders pursuant to any requirements of the Code as
are in force from time to time.
(c) On each Payment Date, the Master Servicer shall supply an
electronic tape to Bloomberg Financial Markets, Inc. in a format acceptable to
Bloomberg Financial Markets, Inc. on a monthly basis, and shall supply an
electronic tape to Loan Performance and Intex Solutions in a format acceptable
to Loan Performance and Intex Solutions on a monthly basis.
Section 5.11 Advances.
If the Monthly Payment on a Mortgage Loan that was due on a related Due
Date and is delinquent, other than as a result of application of the Relief Act,
and for which the related Servicer was required to make an advance pursuant to
the related Servicing Agreement exceeds the amount deposited in the Collection
Account which will be used for an advance with respect
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to such Mortgage Loan, the Master Servicer will deposit in the Collection
Account not later than the Master Servicer Remittance Date immediately preceding
the related Payment Date an amount equal to such deficiency, net of the
Servicing Fee and the Master Servicing Fee, for such Mortgage Loan except to the
extent the Master Servicer determines any such Advance to be Nonrecoverable from
Liquidation Proceeds, Insurance Proceeds, condemnation proceeds or future
payments on the Mortgage Loan for which such Advance was made. Subject to the
foregoing, the Master Servicer shall continue to make such Advances through the
date that the related Servicer is required to do so under its Servicing
Agreement. If applicable, on the Master Servicer Remittance Date, the Master
Servicer shall present an Officer's Certificate to the Indenture Trustee (i)
stating that the Master Servicer elects not to make a Advance in a stated amount
and (ii) detailing the reason it deems the advance to be Nonrecoverable.
Section 5.12 Compensating Interest Payments.
The amount of the Master Servicing Fee payable to the Master Servicer
in respect of any Payment Date shall be reduced (but not below zero) by the
amount of any Compensating Interest Payment for such Payment Date, but only to
the extent that Interest Shortfalls relating to such Payment Date are required
to be paid but are not actually paid by the related Servicers on the applicable
Servicer Remittance Date. Such amount shall not be treated as an Advance and
shall not be reimbursable to the Master Servicer.
ARTICLE VI
MASTER SERVICER EVENTS OF DEFAULT
Section 6.01 Master Servicer Events of Default; Indenture Trustee To
Act; Appointment of Successor.
(a) If any one of the following events (each, a "Master Servicer Event
of Default") shall occur and be continuing:
(i) the failure by the Master Servicer to make any
Advance or to deposit in the Collection Account or Note Account any
deposit required to be made or failure to remit to the Indenture
Trustee any other payment required under the terms of this Agreement,
and such failure continues unremedied for a period of three Business
Days after the date upon which written notice of such failure,
requiring the same to be remedied, shall have been given to the Master
Servicer;
(ii) the failure by the Master Servicer duly to observe or
perform, in any material respect, any other covenants, obligations or
agreements of the Master Servicer as set forth in this Agreement, which
failure continues unremedied for a period of 60 days (or, in the case
of a breach of its obligation to provide a Master Servicer
Certification pursuant to Section 4.16, 30 days), in each case after
the date (A) on which written notice of such failure, requiring the
same to be remedied, shall have been given to the Master Servicer by
the Indenture Trustee or to the Master Servicer and the Indenture
Trustee by Holders of Notes evidencing at least 25% of the aggregate
Class Principal Amount of all
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Classes of Notes or (B) on which a Servicing Officer of the Master
Servicer has actual knowledge of such failure; or
(iii) the entry against the Master Servicer of a decree or
order by a court or agency or supervisory authority having jurisdiction
in the premises for the appointment of a trustee, conservator, receiver
or liquidator in any insolvency, conservatorship, receivership,
readjustment of debt, marshalling of assets and liabilities or similar
proceedings, or for the winding up or liquidation of its affairs, and
the continuance of any such decree or order unstayed and in effect for
a period of 60 days; or
(iv) the Master Servicer shall voluntarily go into
liquidation, consent to the appointment of a conservator or receiver or
liquidator or similar person in any insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings of or
relating to the Master Servicer or of or relating to all or
substantially all of its property; or a decree or order of a court or
agency or supervisory authority having jurisdiction in the premises for
the appointment of a conservator, receiver, liquidator or similar
person in any insolvency, readjustment of debt, marshalling of assets
and liabilities or similar proceedings, or for the winding-up or
liquidation of its affairs, shall have been entered against the Master
Servicer and such decree or order shall have remained in force
undischarged, unbonded or unstayed for a period of 60 days; or the
Master Servicer shall admit in writing its inability to pay its debts
generally as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make an assignment for
the benefit of its creditors or voluntarily suspend payment of its
obligations;
(b) then, and in each and every such case, so long as a Master Servicer
Event of Default shall not have been remedied within the applicable grace
period, the Indenture Trustee shall, at the written direction of the Majority
Securityholders, or at its option may, by notice then given in writing to the
Master Servicer, terminate all of the rights and obligations of the Master
Servicer as servicer under this Agreement. Any such notice to the Master
Servicer shall also be given to each Rating Agency, the Depositor, the Issuer,
the Owner Trustee and the Seller. On or after the receipt by the Master Servicer
(and by the Indenture Trustee if such notice is given by the Holders) of such
written notice, all authority and power of the Master Servicer under this
Agreement, whether with respect to the Certificates or the Mortgage Loans or
otherwise, shall pass to and be vested in the Indenture Trustee and the
Indenture Trustee is hereby authorized and empowered to execute and deliver, on
behalf of the Master Servicer, as attorney-in-fact or otherwise, any and all
documents and other instruments, and to do or accomplish all other acts or
things necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement of each Mortgage
Loan and related documents or otherwise. The Master Servicer agrees to cooperate
with the Indenture Trustee in effecting the termination of the responsibilities
and rights of the Master Servicer hereunder, including, without limitation, the
delivery to the Indenture Trustee of all documents and records requested by it
to enable it to assume the Master Servicer's functions under this Agreement
within ten Business Days subsequent to such notice and the transfer within one
Business Day subsequent to such notice to the Indenture Trustee for the
administration by it of all cash amounts that shall at the time be held by the
Master Servicer and to be deposited by it in the Collection Account, the Note
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Account or any Servicing Account or that have been deposited by the Master
Servicer in such accounts or thereafter received by the Master Servicer with
respect to the Mortgage Loans or any REO Property received by the Master
Servicer. All reasonable costs and expenses (including attorneys' fees) incurred
in connection with transferring the Master Servicer's duties and the Mortgage
Files to the successor Master Servicer and amending this Agreement to reflect
such succession as Master Servicer pursuant to this Section shall be paid by the
predecessor Master Servicer (or if the predecessor Master Servicer is the
Indenture Trustee, the initial Master Servicer) upon presentation of reasonable
documentation of such costs and expenses. The termination of the rights and
obligations of the Master Servicer shall not affect any liability it may have
incurred prior to such termination.
(c) Notwithstanding the foregoing, if a Master Servicer Event of
Default described in clause (i) of Section 6.01(a) shall occur, the Indenture
Trustee shall, by notice in writing to the Master Servicer, which may be
delivered by telecopy, immediately suspend all of the rights and obligations of
the Master Servicer thereafter arising under this Agreement, but without
prejudice to any rights it may have as a Securityholder or to reimbursement of
outstanding Advances or other amounts for which the Master Servicer was entitled
to reimbursement as of the date of termination, and the Indenture Trustee shall
act as provided in Section 6.02 to carry out the duties of the Master Servicer,
including the obligation to make any Advance the nonpayment of which was a
Master Servicer Event of Default described in clause (i) of Section 6.01(a). Any
such action taken by the Indenture Trustee must be prior to the distribution on
the relevant Payment Date. If the Master Servicer shall within two Business Days
following such suspension remit to the Indenture Trustee the amount of any
Advance the nonpayment of which by the Master Servicer was a Master Servicer
Event of Default described in clause (i) of Section 6.01(a) and accrued interest
covering the period of suspension on the amount of such Advance at Deutsche
Bank's prime rate (as published in the Wall Street Journal) plus 300 basis
points, the Indenture Trustee, subject to the last sentence of this paragraph,
shall permit the Master Servicer to resume its rights and obligations as Master
Servicer hereunder. The Master Servicer agrees that it will reimburse the
Indenture Trustee for actual, necessary and reasonable costs incurred by the
Indenture Trustee because of action taken pursuant to this subsection. The
Master Servicer agrees that if a Master Servicer Event of Default as described
in clause (i) of Section 6.01(a) shall occur more than two times in any 12 month
period, the Indenture Trustee shall be under no obligation to permit the Master
Servicer to resume its rights and obligations as Master Servicer hereunder.
Section 6.02 Indenture Trustee to Act.
(a) From and after the date the Master Servicer (and the Indenture
Trustee, if notice is sent by the Holders of the Notes) receives a notice of
termination pursuant to Section 6.01, the Indenture Trustee shall be the
successor in all respects to the Master Servicer in its capacity as servicer
under this Agreement and the transactions set forth or provided for herein and
shall be subject to all the responsibilities, duties and liabilities relating
thereto placed on the Master Servicer by the terms and provisions hereof arising
on and after its succession. As compensation therefor, the Indenture Trustee
shall be entitled to such compensation as the Master Servicer would have been
entitled to hereunder if no such notice of termination had been given.
Notwithstanding the above, (i) if the Indenture Trustee is unwilling to act as
successor Master
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Servicer or (ii) if the Indenture Trustee is legally unable so to act, the
Indenture Trustee shall appoint or petition a court of competent jurisdiction to
appoint, any established housing and home finance institution, bank or other
mortgage loan or home equity loan servicer having a net worth of not less than
$15,000,000 as the successor to the Master Servicer hereunder in the assumption
of all or any part of the responsibilities, duties or liabilities of the Master
Servicer hereunder; provided, that the appointment of any such successor Master
Servicer shall not result in the qualification, reduction or withdrawal of the
ratings assigned to the Notes by any Rating Agency as evidenced by a letter to
such effect from each Rating Agency. Pending appointment of a successor to the
Master Servicer hereunder, unless the Indenture Trustee is prohibited by law
from so acting, the Indenture Trustee shall act in such capacity as hereinabove
provided. In connection with such appointment and assumption, the successor
shall be entitled to receive compensation out of payments on Mortgage Loans in
an amount equal to the compensation which the Master Servicer would otherwise
have received pursuant to Section 4.12. The appointment of a successor Master
Servicer shall not affect any liability of the predecessor Master Servicer which
may have arisen under this Agreement prior to its termination as Master Servicer
to pay any deductible under an insurance policy pursuant to Section 4.08 or to
indemnify the Indenture Trustee pursuant to of this Agreement), nor shall any
successor Master Servicer be liable for any acts or omissions of the predecessor
Master Servicer or for any breach by such Master Servicer of any of its
representations or warranties contained herein or in any related document or
agreement. The Indenture Trustee and such successor shall take such action,
consistent with this Agreement, as shall be necessary to effectuate any such
succession. In the event that the Indenture Trustee does not succeed to the
duties of the Master Servicer pursuant to Section 6.02 hereof, Xxxxxxxxx shall
have the right, but not the obligation, to be appointed successor master
servicer hereunder.
(b) Any successor, including the Indenture Trustee, to the Master
Servicer as Master Servicer shall during the term of its service as Master
Servicer continue to service and administer the Mortgage Loans for the benefit
of Securityholders, and maintain in force a policy or policies of insurance
covering errors and omissions in the performance of its obligations as Master
Servicer hereunder and a fidelity bond in respect of its officers, employees and
agents to the same extent as the Master Servicer is so required pursuant to
Section 4.03.
(c) Notwithstanding anything else herein to the contrary, in no event
shall the Indenture Trustee be liable for any servicing fee or for any
differential in the amount of the servicing fee paid hereunder and the amount
necessary to induce any successor Master Servicer to act as successor Master
Servicer under this Agreement and the transactions set forth or provided for
herein.
Section 6.03 Waiver of Master Servicer Event of Default.
The Majority Securityholders may, on behalf of all Securityholders, by
notice in writing to the Indenture Trustee, direct the Indenture Trustee to
waive any events permitting removal of any Master Servicer under this Agreement.
Upon any waiver of a Master Servicer Event of Default, such event shall cease to
exist and any Master Servicer Event of Default arising therefrom shall be deemed
to have been remedied for every purpose of this Agreement. No such waiver shall
extend to any subsequent or other event or impair any right consequent thereto
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except to the extent expressly so waived. Notice of any such waiver shall be
given by the Indenture Trustee to each Rating Agency.
Section 6.04 Notification to Holders.
Upon any termination or appointment of a successor to any Master
Servicer pursuant to this Article VI or Section 4.25, the Indenture Trustee
shall give prompt written notice thereof to the Securityholders at their
respective addresses appearing in the Note Register, the Certificate Register
and to each Rating Agency.
No later than 60 days after the occurrence of any event which
constitutes or which, with notice or a lapse of time or both, would constitute a
Master Servicer Event of Default of which a Responsible Officer of the Indenture
Trustee becomes aware, the Indenture Trustee shall transmit by mail to all
Securityholders notice of such occurrence unless such Master Servicer Event of
Default shall have been waived or cured.
ARTICLE VII
TERMINATION
Section 7.01 Termination.
(a) This Agreement shall terminate upon any of the following events:
the earlier of (i) the satisfaction and discharge of the Indenture and notice to
the Indenture Trustee of such discharge, the disposition of all funds with
respect to the Collateral and the payment of all amounts due and payable to the
Securityholders, the Indenture Trustee (including the Indenture Trustee as
Paying Agent), the Owner Trustee, the Administrator, the Master Servicer, the
Servicers and the Issuer pursuant to this Agreement and the Indenture (including
payment pursuant to Section 7.03 below); or (ii) mutual written consent of the
Master Servicer, the Seller, the Depositor, the Indenture Trustee, the Issuer
and all then Securityholders in writing.
(b) Notice of termination of this Agreement pursuant to Section
7.01(a)(i) shall be sent by the Indenture Trustee to the Noteholders in
accordance with the Indenture and to the Certificateholders by the Certificate
Paying Agent (as defined in the Trust Agreement) as provided in the Trust
Agreement. Notice of termination of this Agreement pursuant to Section
7.01(a)(ii) shall be mailed or transmitted by facsimile by the Indenture Trustee
to the Noteholders and by the Certificate Paying Agent to the Certificateholders
on the Business Day immediately following the day on which the Indenture Trustee
and the Certificate Paying Agent, respectively, receive notice of such
termination, and such notices to the Securityholders shall state that the
Securityholders are to surrender their respective Notes and Trust Certificates,
respectively, for cancellation and shall specify the place where such Notes or
Trust Certificates are to be surrendered.
Section 7.02 Optional Note Purchase. On any Payment Date occurring on
or after the Initial Optional Notes Purchase Date, Xxxxxxxxx Mortgage Home Loans
Inc. has the assignable option to call all Classes of Notes, in whole but not in
part, under Article X of the Indenture. Notice of any exercise of the Note
Purchase Option shall be sent by the Indenture Trustee to
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Securityholders in accordance with the Indenture. Upon exercise of the Note
Purchase Option, Xxxxxxxxx Mortgage Home Loans Inc. or its assignee will call
each Class of Notes at the related Note Purchase Price. After exercise of the
Note Purchase Option each Class of Notes will remain outstanding and will not be
retired as provided in the Indenture.
Section 7.03 Optional Termination.
Xxxxxxxxx, as a servicer, may, at its option, terminate this Agreement
on any Payment Date on which the aggregate of the Scheduled Principal Balances
of the Mortgage Loans immediately after such date is equal to or less than 10%
of the Scheduled Principal Balance as of the Cut-Off Date, by purchasing, on
such Payment Date, all of the outstanding Mortgage Loans and REO Properties at a
price equal to the sum of (i) the outstanding Scheduled Principal Balances of
the Mortgage Loans (other than in respect of REO Properties), (ii) the lesser of
(x) the appraised value of any REO Property as determined by the higher of two
appraisals completed by two independent appraisers selected by the Depositor at
the expense of the Holder of the Trust Certificate and (y) the outstanding
principal balance of each Mortgage Loan related to any REO Property and (iii) in
all cases, accrued and unpaid interest thereon at the applicable Loan Rate
through the end of the Due Period preceding the final Payment Date, plus
unreimbursed Servicing Advances and Advances and any unpaid Master Servicing
Fees and Servicing Fees allocable to such Mortgage Loans and REO Properties,
plus all amounts, if any, then due and owing to the Indenture Trustee, the Owner
Trustee, the Administrator and the Master Servicer under the Operative
Agreements (the "Termination Price").
Section 7.04 Procedure Upon Termination.
(a) Notice of any termination pursuant to the provisions of Sections
7.01 and 7.03, specifying the Payment Date upon which the final distribution
shall be made, shall be given promptly by the Indenture Trustee by first class
mail to Securityholders. Such notice shall specify (A) the Payment Date upon
which final distribution on the Securities of all amounts required to be
distributed to Securityholders will be made upon presentation and surrender of
the Securities at the Corporate Trust Office, and (B) that the Record Date
otherwise applicable to such Payment Date is not applicable, distribution being
made only upon presentation and surrender of the Securities at the office or
agency of the Indenture Trustee therein specified. The Indenture Trustee shall
give such notice to the Master Servicer, the Owner Trustee, the Administrator
and the Note Registrar at the time such notice is given to Holders of the
Securities. Upon any such termination, the duties of the Note Registrar with
respect to the Notes shall terminate and the Indenture Trustee shall terminate
or request the Master Servicer to terminate, the Trust Accounts, the Certificate
Account and any other account or fund maintained with respect to the Securities,
subject to the Indenture Trustee's obligation hereunder to hold all amounts
payable to Securityholders in trust without interest pending such payment.
(b) In the event that all of the Holders do not surrender their
Securities for cancellation within three months after the time specified in the
above-mentioned written notice, the Indenture Trustee shall give a second
written notice to the remaining Securityholders to surrender their Securities
for cancellation and receive the final distribution with respect thereto. If
within nine months after the second notice any Securities shall not have been
surrendered for cancellation, the Indenture Trustee shall, subject to applicable
state law relating to escheatment, pay over to
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the Issuer all amounts distributable to such Holders and such Holders shall look
only to the Issuer for payment. No interest shall accrue on any amount held by
the Indenture Trustee and not distributed to a Securityholder due to such
Securityholder's failure to surrender its Securities for payment of the final
distribution thereon in accordance with this Section.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
Section 8.01 Binding Nature of Agreement; Assignment. This Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
Section 8.02 Entire Agreement. This Agreement contains the entire
agreement and understanding among the parties hereto with respect to the subject
matter hereof, and supersedes all prior and contemporaneous agreements,
understandings, inducements and conditions, express or implied, oral or written,
of any nature whatsoever with respect to the subject matter hereof. The express
terms hereof control and supersede any course of performance and/or usage of the
trade inconsistent with any of the terms hereof.
Section 8.03 Amendment. (a) This Agreement may be amended from time to
time by the Seller, the Depositor, the Issuer, the Master Servicer and the
Indenture Trustee, without notice to or the consent of any of the
Securityholders, (i) to cure any ambiguity, (ii) to cause the provisions herein
to conform to or be consistent with or in furtherance of the statements made
with respect to the Securities, the Issuer or this Agreement in any Offering
Document, or to correct or supplement any provision herein which may be
inconsistent with any other provisions herein or in any other Operative
Agreement, (iii) to make any other provisions with respect to matters or
questions arising under this Agreement or (iv) to add, delete, or amend any
provisions to the extent necessary or desirable to comply with any requirements
imposed by the Code. No such amendment effected pursuant to clauses (i) through
(iii) of the preceding sentence shall adversely affect in any material respect
the interests of any Securityholder. Prior to entering into any amendment
without the consent of Noteholders pursuant to this paragraph, the Indenture
Trustee may require an Opinion of Counsel (at the expense of the party
requesting such amendment) to the effect that such amendment is permitted under
this paragraph. Any such amendment shall be deemed not to adversely affect in
any material respect any Noteholder if the Indenture Trustee receives (i)
written confirmation from each Rating Agency that such amendment will not cause
a Rating Agency to withdraw, qualify or reduce the then current rating assigned
to the Notes or (ii) an Opinion of Counsel to such effect.
(b) This Agreement may also be amended from time to time by the
Depositor, the Issuer, the Master Servicer, the Seller and the Indenture Trustee
with the consent of the Holders of not less than 66-2/3% of the Note Principal
Amount of the Notes and of the Holder of the Trust Certificate 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
Securityholders; provided, however, that no such amendment may (i) reduce in any
manner the amount of, delay the timing of, or change the manner in which
payments received on or with respect to the Trust Estate are required to be made
on any Class of Securities, without the
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consent of the Securityholders of such Class, or (ii) reduce the aforesaid
percentages of Note Principal Amount of Notes, the Holders of which are required
to consent to any such amendment without the consent of the Securityholders of
100% of such Securities. For purposes of this paragraph, references to "Holder"
or "Holders" shall be deemed to include, in the case of Book-Entry Notes, the
related Note Owners.
(c) Promptly after the execution of any such amendment, the Indenture
Trustee shall furnish written notification of the substance of such amendment to
each Securityholder, the Depositor and to each Rating Agency.
(d) It shall not be necessary for the consent of Securityholders under
this Section 8.03 to approve the particular form of any proposed amendment, but
it shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Securityholders shall be subject to such reasonable
regulations as the Indenture Trustee may prescribe.
Section 8.04 Acts of Securityholders. Except as otherwise specifically
provided herein, whenever Securityholder action, consent or approval is required
under this Agreement, such action, consent or approval shall be deemed to have
been taken or given on behalf of, and shall be binding upon, all Securityholders
if the Majority Securityholders agree to take such action or give such consent
or approval.
Section 8.05 Recordation of Agreement. To the extent permitted by
applicable law, this Agreement, or a memorandum thereof if permitted under
applicable law, is subject to recordation in all appropriate public offices for
real property records in all of 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 on direction of Holders of not less than 66-2/3%
of the Note Principal Amount of the Notes and of the Holder of the Trust
Certificate and at the expense of those requesting such recordation, but only
when accompanied by an Opinion of Counsel to the effect that such recordation
materially and beneficially affects the interests of the Securityholders, or is
necessary for the administration or servicing of the Mortgage Loans.
Section 8.06 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 8.07 Notices.
All directions, demands and notices hereunder shall be in writing and
shall be deemed to have been duly given if personally delivered at or mailed by
first class mail, postage prepaid, or by express delivery service, to (a) in the
case of the Seller, to Xxxxxxxxx Mortgage Home Loans, Inc., 000 Xxxxxxxxxx
Xxxxxx, Xxxxx 000, Xxxxx Xx, Xxx Xxxxxx 00000, Attention: Xxxxxxx Xxxxx
(telecopy number (000) 000-0000), or such other address or telecopy number as
may
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hereafter be furnished to the Depositor, the Master Servicer, the Issuer and the
Indenture Trustee in writing by the Seller, (b) in the case of the Indenture
Trustee, to the Corporate Trust Office or such other address or telecopy number
as may hereafter be furnished to the Depositor, the Master Servicer, the Issuer
and the Seller in writing by the Indenture Trustee, (c) in the case of the
Depositor, to Greenwich Capital Acceptance, Inc., 000 Xxxxxxxxx Xxxx, Xxxxxxxxx,
Xxxxxxxxxxx 00000, Attention: Legal (telecopy number (000) 000-0000), or such
other address or telecopy number as may be furnished to the Seller, the Master
Servicer, the Issuer and the Indenture Trustee in writing by the Depositor, (d)
in the case of the Master Servicer Xxxxx Fargo Bank Minnesota, National
Association, X.X. Xxx 00, Xxxxxxxx, Xxxxxxxx 00000, or for overnight delivery,
0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000 (Attention: Xxxxxxxxx 0000-0),
Xxxxxxxxx no.: (000) 000-0000, or such other address or telecopy number as may
be furnished to the Depositor, the Seller, the Issuer and the Indenture Trustee
in writing by the Master Servicer, (e) in the case of the Issuer, c/o Wilmington
Trust Company, 0000 Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attention:
Corporate Trust Administrator, or such other address or telecopy number as may
be furnished to the Depositor, the Seller, the Master Servicer and the Indenture
Trustee by the Issuer, (f) in the case of the Rating Agencies, as set forth in
Section 8.12. Any notice required or permitted to be mailed to a Securityholder
shall be given by first class mail, postage prepaid, at the address of such
Holder as shown in the Note Register or the Certificate Register, as applicable.
Notice of any Master Servicer Event of Default shall be given by telecopy and by
certified mail. Any notice so mailed within the time prescribed in this
Agreement shall be conclusively presumed to have duly been given when mailed,
whether or not the Securityholder receives such notice. A copy of any notice
required to be telecopied hereunder shall also be mailed to the appropriate
party in the manner set forth above.
Section 8.08 Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Securities or
the rights of the Holders thereof.
Section 8.09 Indulgences; No Waivers. Neither the failure nor any delay
on the part of a party to exercise any right, remedy, power or privilege under
this Agreement shall operate as a waiver thereof, nor shall any single or
partial exercise of any right, remedy, power or privilege preclude any other or
further exercise of the same or of any other right, remedy, power or privilege,
nor shall any waiver of any right, remedy, power or privilege with respect to
any occurrence be construed as a waiver of such right, remedy, power or
privilege with respect to any other occurrence. No waiver shall be effective
unless it is in writing and is signed by the party asserted to have granted such
waiver.
Section 8.10 Headings Not To Affect Interpretation. The headings
contained in this Agreement are for convenience of reference only, and they
shall not be used in the interpretation hereof.
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Section 8.11 Benefits of Agreement. Nothing in this Agreement or in the
Securities, express or implied, shall give to any Person, other than the parties
to this Agreement and their successors hereunder and the Holders of the
Securities, any benefit or any legal or equitable right, power, remedy or claim
under this Agreement.
Section 8.12 Special Notices to the Rating Agencies. (a) The Indenture
Trustee shall give prompt notice to each Rating Agency of the occurrence of any
of the following events of which it has notice:
(i) any amendment to this Agreement pursuant to Section
6.03; and
(ii) the making of a final payment hereunder.
(b) All notices to the Rating Agencies provided for by this Section
shall be in writing and sent by first class mail, telecopy or overnight courier,
as follows:
if to Moody's:
Xxxxx'x Investors Service, Inc.
00 Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax no.: (000) 000-0000
if to S&P:
Standard & Poors Ratings Services, a division
of The XxXxxx-Xxxx Companies, Inc.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax no.: (000) 000-0000
(c) The Master Servicer shall make available to the Rating Agencies
each report prepared pursuant to Section 5.10.
Section 8.13 Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original, and all of
which together shall constitute one and the same instrument.
Section 8.14 Execution by the Issuer. It is expressly understood and
agreed by the parties hereto that (a) this Agreement is executed and delivered
by Wilmington Trust Company, not individually or personally but solely as Owner
Trustee of the Issuer, in the exercise of the powers and authority conferred and
vested in it as trustee, (b) each of the representations, undertakings and
agreements herein made on the part of the Issuer is made and intended not as
personal representations, undertakings and agreements by Wilmington Trust
Company but is made and intended for the purpose of binding only the Issuer, (c)
nothing herein contained shall be construed as creating any liability on
Wilmington Trust Company, individually or personally, to perform any covenant
either expressed or implied contained herein, all such liability, if any,
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being expressly waived by the parties hereto and by any person claiming by,
through or under the parties hereto and (d) under no circumstances shall
Wilmington Trust Company be personally liable for the payment of any
indebtedness or expenses of the Issuer or be liable for the breach or failure of
any obligation, representation, warranty or covenant made or undertaken by the
Issuer under this Agreement or any other document.
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IN WITNESS WHEREOF, the parties hereto have caused their names to be
signed hereto by their respective officers hereunto duly authorized as of the
day and year first above written.
XXXXXXXXX MORTGAGE SECURITIES
TRUST 2003-4
By: WILMINGTON TRUST COMPANY, not
in its individual capacity but solely as
Owner Trustee
By: _________________________________________________
Name:
Title:
GREENWICH CAPITAL ACCEPTANCE, INC.,
as Depositor
By: _________________________________________________
Name: Xxxxxx Xxxxxxxxxxx
Title: Vice President
DEUTSCHE BANK NATIONAL TRUST
COMPANY, as Indenture Trustee
By: _________________________________________________
Name:
Title:
By: _________________________________________________
Name:
Title:
XXXXX FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION, as Master Servicer
By:__________________________________________________
Name:
Title:
00000 Xxxxxxxxx 2003-04 [10203-023]
Sale and Servicing Agreement
XXXXXXXXX MORTGAGE HOME LOANS,
INC., as Seller,
By:__________________________________________________
Name:
Title:
00000 Xxxxxxxxx 2003-04 [10203-023]
Sale and Servicing Agreement
2
