EXECUTION COPY
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DEUTSCHE MORTGAGE SECURITIES, INC.
Depositor
and
XXXXX FARGO BANK MINNESOTA, NATIONAL ASSOCIATION
Master Servicer and Securities Administrator
and
BANK ONE, NATIONAL ASSOCIATION
Trustee
_____________________
POOLING AND SERVICING AGREEMENT
Dated as of December 1, 2002
_____________________
$625,547,413
Mortgage Pass-Through Certificates
Series 2002-1
TABLE OF CONTENTS
DEFINITIONS.......................................................................................................4
ARTICLE II
CONVEYANCE OF TRUST FUND;
ORIGINAL ISSUANCE OF CERTIFICATES.......................................................................35
Section 2.1 Conveyance of Trust Fund..............................................................35
Section 2.2 Acceptance by Trustee.................................................................35
Section 2.3 Repurchase or Substitution of Loans...................................................35
Section 2.4 Authentication and Delivery of Certificates; Designation of
Certificates as REMIC Regular and Residual Interests..................................38
Section 2.5 Representations and Warranties of the Master Servicer.................................39
Section 2.6 Establishment of the Trust............................................................41
ARTICLE III
ADMINISTRATION AND SERVICING OF THE LOANS; ACCOUNTS.....................................................42
Section 3.1 Master Servicer.......................................................................42
Section 3.2 REMIC-Related Covenants...............................................................43
Section 3.3 Monitoring of Servicers...............................................................43
Section 3.4 Fidelity Bond.........................................................................44
Section 3.5 Power to Act; Procedures..............................................................44
Section 3.6 Due-on-Sale Clauses; Assumption Agreements............................................45
Section 3.7 Release of Mortgage Files.............................................................45
Section 3.8 Documents, Records and Funds in Possession of Master Servicer
To Be Held for Trustee................................................................46
Section 3.9 Standard Hazard Insurance and Flood Insurance Policies................................47
Section 3.10 Presentment of Claims and Collection of Proceeds......................................48
Section 3.11 Maintenance of the Primary Mortgage Insurance Policies................................48
Section 3.12 Trustee to Retain Possession of Certain Insurance Policies and
Documents.............................................................................48
Section 3.13 Realization Upon Defaulted Loans......................................................49
Section 3.14 Compensation for the Master Servicer..................................................49
Section 3.15 REO Property..........................................................................49
Section 3.16 Annual Officer's Certificate as to Compliance.........................................50
Section 3.17 Annual Independent Accountant's Servicing Report......................................51
Section 3.18 Reports Filed with Securities and Exchange Commission.................................51
Section 3.19 UCC...................................................................................52
Section 3.20 Obligation of the Master Servicer in respect of Compensating Interest.................52
Section 3.21 Reserved..............................................................................53
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Section 3.22 Protected Accounts....................................................................53
Section 3.23 Master Servicer Collection Account....................................................54
Section 3.24 Permitted Withdrawals and Transfers from the Master Servicer
Collection Account....................................................................55
Section 3.25 Distribution Account..................................................................56
Section 3.26 Permitted Withdrawals and Transfers from the Distribution Account.....................56
ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS; ADVANCES;
STATEMENTS AND REPORTS..................................................................................59
Section 4.1 Distributions to Certificateholders...................................................59
Section 4.2 Allocation of Realized Losses.........................................................64
Section 4.3 Statements to Certificateholders......................................................65
Section 4.4 Remittance Reports; Advances..........................................................67
Section 4.5 Compliance with Withholding Requirements..............................................68
ARTICLE V
THE CERTIFICATES........................................................................................69
Section 5.1 The Certificates......................................................................69
Section 5.2 Certificates Issuable in Classes; Distributions of Principal and Interest;
Authorized Denominations................................................................................75
Section 5.3 Registration of Transfer and Exchange of Certificates.................................76
Section 5.4 Mutilated, Destroyed, Lost or Stolen Certificates.....................................76
Section 5.5 Persons Deemed Owners.................................................................77
Section 5.6 Temporary Certificates................................................................77
Section 5.7 Book-Entry for Book-Entry Certificates................................................77
Section 5.8 Notices to Clearing Agency............................................................78
Section 5.9 Definitive Certificates...............................................................79
ARTICLE VI
THE DEPOSITOR AND THE MASTER SERVICER...................................................................80
Section 6.1 Liability of the Depositor and the Master Servicer....................................80
Section 6.2 Merger or Consolidation of the Depositor or the Master Servicer.......................80
Section 6.3 Limitation on Liability of the Depositor, the Master Servicer, the
Servicers, the Securities Administrator and Others......................................................80
Section 6.4 Limitation on Resignation of the Master Servicer......................................81
Section 6.5 Assignment of Master Servicing........................................................82
Section 6.6 Rights of the Depositor in Respect of the Master Servicer.............................82
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ARTICLE VII
DEFAULT.................................................................................................84
Section 7.1 Master Servicer Events of Default.....................................................84
Section 7.2 Trustee to Act; Appointment of Successor..............................................86
Section 7.3 Notification to Certificateholders....................................................87
Section 7.4 Waiver of Master Servicer Events of Default...........................................87
ARTICLE VIII
CONCERNING THE TRUSTEE AND THE SECURITIES ADMINISTRATOR.................................................88
Section 8.1 Duties of Trustee and Securities Administrator........................................88
Section 8.2 Certain Matters Affecting Trustee and Securities Administrator........................89
Section 8.3 Trustee and Securities Administrator not Liable for Certificates or
Loans.................................................................................91
Section 8.4 Trustee and Securities Administrator May Own Certificates.............................91
Section 8.5 Fees and Expenses of Trustee and Securities Administrator.............................91
Section 8.6 Eligibility Requirements for Trustee and Securities Administrator.....................92
Section 8.7 Resignation and Removal of Trustee and Securities Administrator.......................92
Section 8.8 Successor Trustee or Securities Administrator.........................................93
Section 8.9 Merger or Consolidation of Trustee or Securities Administrator........................94
Section 8.10 Appointment of Co-Trustee or Separate Trustee.........................................94
Section 8.11 Appointment of Office or Agency.......................................................95
Section 8.12 Representations and Warranties........................................................95
ARTICLE IX
TERMINATION.............................................................................................97
Section 9.1 Termination Upon Purchase or Liquidation of All Loans.................................97
Section 9.2 Additional Termination Requirements...................................................99
ARTICLE X
REMIC PROVISIONS.......................................................................................100
Section 10.1 REMIC Administration.................................................................100
Section 10.2 Prohibited Transactions and Activities...............................................102
Section 10.3 Indemnification......................................................................103
ARTICLE XI
MISCELLANEOUS PROVISIONS...............................................................................104
Section 11.1 Amendment............................................................................104
Section 11.2 Recordation of Agreement; Counterparts...............................................105
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Section 11.3 Limitation on Rights of Certificateholders...........................................105
Section 11.4 Governing Law........................................................................106
Section 11.5 Notices..............................................................................106
Section 11.6 Severability of Provisions...........................................................107
Section 11.7 Notice to Rating Agencies............................................................107
Section 11.8 Article and Section References.......................................................108
Section 11.9 Grant of Security Interest...........................................................108
Section 11.10 Third Party Beneficiaries............................................................109
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EXHIBITS
Exhibit A - Forms of Certificates
Exhibit B - Form of Residual Certificate
Exhibit C - [Reserved]
Exhibit D - Schedule of Loans
Exhibit E - Form of Regulation S Transfer Certificate
Exhibit F - Form of Transferor Certificate for Junior Subordinate Certificates
Exhibit G - Form of Transferee's Certificate for Junior Subordinate Certificates
Exhibit H - Form of Benefit Plan Affidavit
Exhibit I - Form of Transferor Certificate
Exhibit J - Form of Transferee Affidavit and Agreement
Exhibit K - Form of Additional Matter Incorporated into the Form of the Certificates
Exhibit L - Form of Rule 144A Investment Representation
Exhibit M - Planned Principal Balances
Exhibit N - Targeted Principal Balances
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This Pooling and Servicing Agreement, dated and effective as of
December 1, 2002 (this "Agreement"), is executed by and among Deutsche Mortgage
Securities, Inc., as depositor (the "Depositor"), Xxxxx Fargo Bank Minnesota,
National Association, as master servicer (the "Master Servicer") and securities
administrator (the "Securities Administrator"), and Bank One, National
Association, as trustee (the "Trustee"). Capitalized terms used in this
Agreement and not otherwise defined have the meanings ascribed to such terms in
Article I hereof.
PRELIMINARY STATEMENT
The Depositor at the Closing Date is the owner of the Loans and the
other property being conveyed by it to the Trustee for inclusion in the Trust
Fund. On the Closing Date, the Depositor will acquire the Certificates from the
Trust Fund as consideration for its transfer to the Trust Fund of the Loans and
certain other assets and will be the owner of the Certificates. The Depositor
has duly authorized the execution and delivery of this Agreement to provide for
the conveyance to the Trustee of the Loans and the issuance to the Depositor of
the Certificates representing in the aggregate the entire beneficial ownership
of the Trust Fund. All covenants and agreements made by the Depositor, the
Master Servicer, the Securities Administrator and the Trustee herein with
respect to the Loans and the other property constituting the Trust Fund are for
the benefit of the Holders from time to time of the Certificates. The Depositor,
the Master Servicer and the Securities Administrator are entering into this
Agreement, and the Trustee is accepting the trust created hereby, for good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged.
The Certificates issued hereunder, other than the Class B-3, Class B-4
and Class B-5 Certificates have been offered for sale pursuant to a Prospectus,
dated December 26, 2002, and a Prospectus Supplement, dated December 26, 2002 of
the Depositor (together, the "Prospectus"). The Class B-3, Class B-4 and Class
B-5 Certificates have been offered for sale pursuant to a Private Placement
Memorandum dated December 30, 2002. The Trust Fund created hereunder is intended
to be the "Trust" as described in the Prospectus and the Private Placement
Memorandum and the Certificates are intended to be the "Certificates" described
therein.
As provided herein, the Trustee will elect to treat the segregated pool
of assets consisting of the Loans and other related assets in the Trust Fund
subject to this Agreement as a REMIC for federal income tax purposes, and such
segregated pool of assets will be designated as "REMIC I." Component R-1 of the
Class R Certificate will represent the sole class of "residual interests" in
REMIC I for purposes of the REMIC Provisions under federal income tax law.
As provided herein, the Trustee will elect to treat the segregated pool
of assets consisting of the REMIC I Regular Interests as a REMIC for federal
income tax purposes, and such segregated pool of assets will be designated as
"REMIC II". Component R-2 of the Class R Certificate will represent the sole
class of "residual interests" in REMIC II for purposes of the REMIC Provisions
under federal income tax law. The following table irrevocably sets forth the
designations, the Remittance Rate and initial Class Principal Balance for each
Class of Certificates which, together with the Class R-2 Component, constitute
the entire beneficial interests in REMIC II. Determined solely for purposes of
satisfying Treasury regulation section 1.860G-1(a)(4)(iii), the "latest possible
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maturity date" for each of the REMIC I Regular Interests and for each Class of
Certificates shall be the first Distribution Date that is two years after the
end of the remaining amortization schedule of the Loan in the Mortgage Pool that
has, as of the Closing Date, the longest remaining amortization schedule,
irrespective of its scheduled maturity. The following table sets forth the
designation, Remittance Rate, initial Class Principal Balance, and Last
Scheduled Distribution Date for each Class of Certificates comprising the
beneficial interests in REMIC II and the Class R Certificate:
INITIAL CLASS
REMITTANCE PRINCIPAL OR NOTIONAL LAST SCHEDULED
DESIGNATION RATE BALANCE DISTRIBUTION DATE*
----------- ---- ------- ------------------
Class A-1 4.50% $44,156,000 January 25, 2033
Class A-2 4.50% 33,167,750 January 25, 2033
Class A-3 Variable (1) 46,394,250 January 25, 2033
Class A-4 Variable (2) 46,394,250 January 25, 2033
Class A-5 6.00% 12,669,000 January 25, 2033
Class A-6 6.00% 55,000,000 January 25, 2033
Class A-7 6.00% 1,000 January 25, 2033
Class A-8 Variable (3) 63,663,600 January 25, 2033
Class A-9 Variable(4) 15,915,900 January 25, 2033
Class A-10 5.00% 37,500,000 January 25, 2033
Class A-11 5.50% 75,621,667 January 25, 2033
Class A-12 5.75% 75,000,000 January 25, 2033
Class A-13 8.50% 37,624,333 January 25, 2033
Class A-14 6.00% 13,650,000 October 25, 2013
Class A-15 6.00% 16,500,000 May 25, 2021
Class A-16 6.00%(5) 15,071,500 January 25, 2033
Class A-17 6.00% 58,500,000 January 25, 2033
Class A-18 6.00% 6,500,000 January 25, 2033
Class A-P 0.00%(6) 783,864 January 25, 2033
Class A-X 6.00%(7) 29,381,364 January 25, 2033
Class M 6.00% 8,445,000 January 25, 2033
Class B-1 6.00% 3,441,000 January 25, 2033
Class B-2 6.00% 2,502,000 January 25, 2033
Class B-3 6.00% 1,251,000 January 25, 2033
Class B-4 6.00% 938,000 January 25, 2033
Class B-5 6.00% 1,251,449 January 25, 2033
Class R+ 6.00% 100(8) January 25, 2033
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* The Distribution Date in the month after the maturity date for the latest
maturing Loan. + The Class R Certificate is entitled to receive the Residual
Distribution Amount.
(1) Interest shall accrue on the Class A-3 Certificates at an initial
interest rate of 1.82% and after the first Distribution Date at a rate
per annum of 0.40% above LIBOR, determined monthly as described herein,
subject to a maximum rate of 8.50% and a minimum rate of 0.40%.
(2) Interest shall accrue on the Class A-4 Certificates at an initial
interest rate of 6.68% and after the first Distribution Date at a rate
per annum of 8.10% minus LIBOR, determined monthly as described herein,
subject to a maximum rate of 8.10% and a minimum rate of 0.00%. The
Class A-4 Certificates accrue interest on the Class A-4 Notional Amount
(as defined herein).
(3) Interest shall accrue on the Class A-8 Certificates at an initial
interest rate of 2.92% and after the first Distribution Date at a rate
per annum of 1.50% above LIBOR, determined monthly as described herein,
subject to a maximum rate of 7.50% and a minimum rate of 1.50%.
(4) Interest shall accrue on the Class A-9 Certificates at an initial
interest rate of 18.32% and after the first Distribution Date at a
rate per annum of 24.00% minus (4 x LIBOR), determined monthly as
described herein, subject to a maximum rate of 24.00% and a minimum
rate of 0.00%.
(5) On each Distribution Date prior to the Credit Support Depletion Date
(as defined herein), an amount equal to the Class A-16 Accrual Amount
will be added to the Class A-16 Class Principal Balance and such amount
will be distributed as principal to the Class A-14 and Class A-15
Certificates, in that order, and to other Classes of the Class A
Certificates as described herein and will not be distributed as
interest to the Class A-16 Certificates.
(6) The Class A-P Certificates are not entitled to distributions of
interest and shall receive principal only in respect of the Discount
Loans.
(7) The Class A-X Certificates accrue interest on the Class A-X Notional
Amount (as defined herein).
(8) The Class R Certificate will be comprised of two components, component
R-1, which represents the sole residual interest in REMIC I (as defined
herein), and component R-2, which represents the sole residual interest
in REMIC II (as defined herein).
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W I T N E S S E T H
In consideration of the mutual agreements herein contained, the
Depositor, the Servicer and the Trustee agree as follows:
ARTICLE I
DEFINITIONS
Whenever used herein, the following words and phrases, unless the
context otherwise requires, shall have the meanings specified in this Article:
ACCEPTED MASTER SERVICING PRACTICES: With respect to any 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 Loan in the jurisdiction where the related Mortgaged
Property is located, to the extent applicable to the Master Servicer (except in
its capacity as successor to a Servicer), or (y) as provided in the applicable
Servicing Agreement, to the extent applicable to any Servicer, but in no event
below the standard set forth in clause (x).
ACCOUNT: The Master Servicer Collection Account, the Distribution
Account and any Protected Account as the context may require.
ACCRETION DIRECTED CERTIFICATES: The Class A-14 and Class A-15
Certificates.
ACCRUAL CERTIFICATES: The Class A-16 Certificates.
ADVANCE: Either (i) a Monthly Advance made by a Servicer as such term
is defined in and pursuant to the related Servicing Agreement or (ii) an advance
made by the Master Servicer pursuant to Section 4.4.
ADJUSTABLE RATE CERTIFICATES: The Class A-3, Class A-4, Class A-8 and
Class A-9 Certificates.
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. The Trustee may obtain
and rely on an Officer's Certificate of the Servicer or the Depositor to
determine whether any Person is an Affiliate of such party.
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AGGREGATE CERTIFICATE PRINCIPAL BALANCE: At any given time, the sum of
the then current Class Principal Balances of all Classes of Certificates.
AGREEMENT: This Pooling and Servicing Agreement and all amendments and
supplements hereto.
ANNIVERSARY: Each anniversary of the Cut-off Date.
APPRAISED VALUE: The amount set forth in an appraisal made by or for
the mortgage originator in connection with its origination of each Loan.
ASSIGNMENT: An assignment of the Mortgage, notice of transfer or
equivalent instrument, in recordable form, sufficient under the laws of the
jurisdiction where the related Mortgaged Property is located to reflect of
record the sale and assignment of the Loan to the Trustee, which assignment,
notice of transfer or equivalent instrument may, if permitted by law, be in the
form of one or more blanket assignments covering Mortgages secured by Mortgaged
Properties located in the same county.
ASSIGNMENT AGREEMENTS: Shall mean (i) the Assignment, Assumption and
Recognition Agreement, dated as of December 30, 2002, among the Seller, the
Depositor and National City, pursuant to which the National City Servicing
Agreement was assigned to the Depositor and (ii) the Assignment, Assumption and
Recognition Agreement, dated as of December 30, 2002, among the Seller, the
Depositor and HSBC pursuant to which the HSBC Servicing Agreement was assigned
to the Depositor.
AUTHORIZED DENOMINATION: With respect to the Certificates (other than
the Class A-7, Class A-13 Certificates and Class R Certificate), an initial
Certificate Principal Balance equal to $25,000 each and integral multiples of $1
in excess thereof. With respect to the Class A-7 and Class A-13 Certificates, an
initial Certificate Principal Balance equal to $1,000 each and integral
multiples of $1,000 in excess thereof. With respect to the Class R Certificate,
one Certificate with a Percentage Interest equal to 100%.
AVAILABLE DISTRIBUTION AMOUNT: With respect to a Distribution Date, the
sum of the following amounts:
(1) the total amount of all cash in the Distribution Account with
respect to such Distribution Date and not previously distributed (including
Liquidation Proceeds and Insurance Proceeds), except:
(a) all Prepaid Monthly Payments;
(b) all Curtailments received after the applicable Prepayment
Period;
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(c) all Payoffs received after the applicable Prepayment
Period;
(d) Insurance Proceeds and Liquidation Proceeds on such Loans
received after the applicable Prepayment Period;
(e) all amounts which are due and reimbursable to the related
Servicer pursuant to the terms of the related Servicing Agreement or to
the Master Servicer, the Securities Administrator, the Trustee or the
Custodian pursuant to the terms of this Agreement;
(f) the Servicing Fee and the Master Servicing Fee for each
such Loan; and
(g) Excess Liquidation Proceeds;
(2) to the extent advanced by a Servicer and/or the Master Servicer and
not previously distributed, the amount of any Advance made by a Servicer and/or
the Master Servicer with respect to such Distribution Date relating to such
Loans;
(3) to the extent advanced by the related Servicer and/or the Master
Servicer and not previously distributed, any amount payable as Compensating
Interest by the related Servicer and/or the Master Servicer on such Distribution
Date relating to such Loans; and
(4) the total amount, to the extent not previously distributed, of all
cash received by the Distribution Date by the Trustee or the Master Servicer, in
respect of a Purchase Obligation under Section 2.3 or any permitted repurchase
of a Loan.
BANKRUPTCY COVERAGE: As of the Cut-Off Date, $133,486, and thereafter,
the initial Bankruptcy Coverage amount of $133,486, less (a) any scheduled or
permissible reduction in the amount of Bankruptcy Coverage pursuant to this
definition and (b) Bankruptcy Losses allocated to the Certificates. The
Bankruptcy Coverage may be reduced upon written confirmation from each Rating
Agency that such reduction will not adversely affect the then current ratings
assigned to the Certificates by each Rating Agency.
BANKRUPTCY LOSS: A loss on a Loan, as reported by the related Servicer,
arising out of (i) a reduction in the scheduled Monthly Payment for such Loan by
a court of competent jurisdiction in a case under the United States Bankruptcy
Code, other than any such reduction that arises out of clause (ii) of this
definition of "Bankruptcy Loss," including, without limitation, any such
reduction that results in a permanent forgiveness of principal, or (ii) with
respect to any Loan, a valuation, by a court of competent jurisdiction in a case
under such Bankruptcy Code, of the related Mortgaged Property in an amount less
than the then outstanding Principal Balance of such Loan.
BENEFICIAL HOLDER: A Person holding a beneficial interest in any
Book-Entry Certificate as or through a Depository Participant or an Indirect
Depository Participant or a Person holding a beneficial interest in any
Definitive Certificate.
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BOOK-ENTRY CERTIFICATES: The Class A Certificates, the Class M
Certificates, the Class B-1 Certificates and the Class B-2 Certificates
beneficial ownership and transfers of which shall be made through book entries
as described in Section 5.7.
BUSINESS DAY: Any day other than a Saturday, a Sunday, or a day on
which banking institutions in Maryland, Minnesota or New York, are authorized or
obligated by law or executive order to be closed.
CERTIFICATE: Any one of the Certificates issued pursuant to this
Agreement, executed by the Trustee and authenticated by or on behalf of the
Trustee hereunder in substantially one of the forms set forth in Exhibits A and
B hereto. The additional matter appearing in Exhibit K shall be deemed
incorporated into Exhibits A and B as though set forth at the end of Exhibit A
and at the end of Exhibit B, as applicable.
CERTIFICATE PRINCIPAL BALANCE: For each Certificate of any Class, the
portion of the related Class Principal Balance, if any, represented by such
Certificate.
CERTIFICATE REGISTER AND CERTIFICATE REGISTRAR: The register maintained
and the registrar appointed, respectively, pursuant to Section 5.3. Initially,
the Certificate Registrar shall be Bank One, National Association
CERTIFICATEHOLDER OR HOLDER: The person in whose name a Certificate is
registered in the Certificate Register, except that, solely for the purposes of
giving any consent pursuant to this Agreement, any Certificate registered in the
name of the Depositor, the Master Servicer, the Securities Administrator, the
Trustee or any Affiliate thereof shall be deemed not to be outstanding and the
Percentage Interest evidenced thereby shall not be taken into account in
determining whether the requisite percentage of Percentage Interests necessary
to effect any such consent has been obtained. The Trustee may conclusively rely
upon a certificate of the Depositor, the Seller, the Securities Administrator or
the Master Servicer in determining whether a Certificate is held by an Affiliate
thereof. All references herein to "Holders" or "Certificateholders" shall
reflect the rights of Certificate Owners as they may indirectly exercise such
rights through the Depository and participating members thereof, except as
otherwise specified herein; provided, however, that the Trustee shall be
required to recognize as a "Holder" or "Certificateholder" only the Person in
whose name a Certificate is registered in the Certificate Register.
CERTIFICATE OWNER: With respect to a Book-Entry Certificate, the Person
who is the beneficial owner of such Certificate as reflected on the books of the
Depository or on the books of a Depository Participant or on the books of an
Indirect Depository Participant.
CLASS: All Certificates having the same priority and rights to payments
from the Available Distribution Amount, designated as a separate Class, as set
forth in the forms of Certificates attached hereto as Exhibits A and B.
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CLASS A CERTIFICATES: The Class X-0, X-0, X-0, X-0, X-0, X-0, X-0, X-0,
X-0, X-00, X-00, X-00, X-00, X-00, X-00, X-00, X-00, X-00, X-X and A-X
Certificates, collectively, and designated as such on the face thereof in
substantially the forms attached hereto as Exhibits A-1 through A-20,
respectively.
CLASS A-16 ACCRUAL AMOUNT: For any Distribution Date prior to the
Credit Support Depletion Date, an amount equal to the accrued interest that
would otherwise be distributable in respect of the Class A-16 Certificates on
such Distribution Date and which will be added to the Class A-16 Class Principal
Balance.
CLASS A-3 INTEREST RATE: With respect to the initial Interest Accrual
Period is 1.82% per annum, and as to any Interest Accrual Period thereafter,
will be a per annum rate equal to LIBOR plus 0.40% (subject to a maximum rate of
8.50% per annum and a minimum rate of 0.40% per annum).
CLASS A-4 INTEREST RATE: With respect to the initial Interest Accrual
Period is 6.68% per annum, and as to any Interest Accrual Period thereafter,
will be a per annum rate equal to 8.10% minus LIBOR (subject to a maximum rate
of 8.10% per annum and a minimum rate of 0.00% per annum).
CLASS A-8 INTEREST RATE: With respect to the initial Interest Accrual
Period is 2.92% per annum, and as to any Interest Accrual Period thereafter,
will be a per annum rate equal to LIBOR plus 1.50% (subject to a maximum rate of
7.50% per annum and a minimum rate of 1.50% per annum).
CLASS A-9 INTEREST RATE: With respect to the initial Interest Accrual
Period is 18.32% per annum, and as to any Interest Accrual Period thereafter,
will be a per annum rate equal to 24.00% minus (4 x LIBOR) (subject to a maximum
rate of 24.00% per annum and a minimum rate of 0.00% per annum).
CLASS A-4 NOTIONAL AMOUNT: As of the Closing Date approximately
$46,394,250 and thereafter, with respect to any Distribution Date, will be equal
to the Class Principal Balance of the Class A-3 Certificates.
CLASS A-X NOTIONAL AMOUNT: As of the Closing Date approximately
$29,381,364, and thereafter, with respect to any Distribution Date will equal
the total Principal Balance, as of the first day of the month preceding such
Distribution Date (after giving effect to all payments scheduled to be made on
such day whether or not received), of the Premium Loans multiplied by the
following fraction:
the weighted average of the Net Mortgage Rates of the
Premium Loans as of the first day of such month minus 6.00%
__________________________
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6.00%
CLASS NOTIONAL AMOUNT: With respect to the Class A-4 and Class A-X
Certificates, the Class A-4 Notional Amount and Class A-X Notional Amount,
respectively.
CLASS PRINCIPAL BALANCE: For any Class of Certificates (other than the
Interest Only Certificates), the applicable initial Class Principal Balance set
forth in the Preliminary Statement hereto, corresponding to the rights of such
Class in payments of principal due to be passed through to Certificateholders
from principal payments on the Loans, as reduced from time to time by (x)
distributions of principal to Certificateholders of such Class and (y) the
portion of Realized Losses allocated to the Class Principal Balance of such
Class pursuant to Section 4.2 with respect to a given Distribution Date. For any
Distribution Date, the reduction of the Class Principal Balance of any Class of
Certificates pursuant to Section 4.2 shall be deemed effective prior to the
determination and distribution of principal on such Class pursuant to Section
4.1(a). Notwithstanding the foregoing, the Class Principal Balance of the most
subordinate Class of Certificates outstanding at any time shall be equal to the
aggregate Scheduled Principal Balance of all of the Loans less the Class
Principal Balance of all other Classes of Certificates. The Class Principal
Balance for the Class A-1 Certificates shall be referred to as the "Class A-1
Principal Balance", the Class Principal Balance for the Class A-2 Certificates
shall be referred to as the "Class A-2 Principal Balance" and so on. The Class
Principal Balances of the Interest Only Certificates shall be zero.
CLASS R CERTIFICATE: The Certificate designated as "Class R" on the
face thereof in substantially the form attached hereto as Exhibit B, that is
composed of Components R-1 and R-2 each of which has been designated as the sole
class of "residual interests" in REMIC I and REMIC II, respectively, pursuant to
Section 2.4.
CLASS R CERTIFICATEHOLDER: The registered Holder of the Class R
Certificate.
CLEARING AGENCY: An organization registered as a "clearing agency"
pursuant to Section 17A of the Securities and Exchange Act of 1934, as amended,
which initially shall be the Depository.
CLOSING DATE: December 30, 2002.
CODE: The Internal Revenue Code of 1986, as amended.
COMPENSATING INTEREST: For any Distribution Date, (i) with respect to
the Loans serviced by National City, the aggregate Prepayment Interest
Shortfalls and Curtailment Shortfalls for such Loans for such Distribution Date,
(ii) with respect to the Loans serviced by HSBC, the lesser of (a) the aggregate
Prepayment Interest Shortfalls and Curtailment Shortfalls for such Loans for
such Distribution Date and (b) the sum of (1) the Servicing Fee payable to HSBC
for such Distribution Date and (2) reinvestment income realized by HSBC during
the related Prepayment Period relating to Payoffs and Curtailments made during
such Prepayment Period as calculated and reported by
9
HSBC to the Master Servicer and (iii) with respect to the Master Servicer, that
amount described in Section 3.20.
CORPORATE TRUST OFFICE: The principal corporate trust office of the
Trustee which office at the date of the execution of this instrument is located
at 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Global Corporate
Trust Services, Deutsche Mortgage Securities, Inc., Series 2002- 1, or at such
other address as the Trustee may designate from time to time by notice to the
Certificateholders, the Depositor, the Securities Administrator and the Master
Servicer.
CREDIT SUPPORT DEPLETION DATE: The first Distribution Date on which the
aggregate of the Class Principal Balances of the Subordinate Certificates has
been or will be reduced to zero as a result of principal distributions thereon
and the allocation of Realized Losses on such Distribution Date.
CURTAILMENT: Any payment of principal on a Loan, made by or on behalf
of the related Mortgagor, other than a Monthly Payment, a Prepaid Monthly
Payment or a Payoff, which is applied to reduce the outstanding Principal
Balance of the Loan.
CURTAILMENT SHORTFALL: With respect to any Curtailment, an amount equal to
one month's interest on such Curtailment at the applicable Mortgage Interest
Rate on such Loan.
CUSTODIAL AGREEMENT: The Custodial Agreement dated as of December 1,
2002, among the Trustee, Xxxxx Fargo as Custodian, National City and HSBC as
such agreement may be amended or supplemented from time to time, or any other
custodial agreement entered into after the date hereof with respect to any Loan
subject to this Agreement.
CUSTODIAN: Either Xxxxx Fargo or any other custodian appointed under
any custodial agreement entered into after the date of this Agreement.
CUT-OFF DATE: December 1, 2002; except that with respect to each
Substitute Loan, the Cut- Off Date shall be the date of substitution.
DEFINITIVE CERTIFICATES: As defined in Section 5.7.
DELETED LOAN: A Loan replaced or to be replaced by a Substitute Loan.
DENOMINATION: The amount specified on a Certificate as representing the
aggregate Principal Balance of the Loans as of the Cut-Off Date evidenced by
such Certificate.
DEPOSITOR: Deutsche Mortgage Securities, Inc., a Delaware corporation,
or its successor-in-interest.
10
DEPOSITORY: The Depository Trust Company, or any successor Depository
hereafter named. The nominee of the initial Depository, for purposes of
registering those Certificates that are to be Book-Entry Certificates, is CEDE &
Co. The Depository shall at all times be a "clearing corporation" as defined in
Section 8-102(3) of the Uniform Commercial Code of the State of New York and a
Clearing Agency.
DEPOSITORY AGREEMENT: The Letter of Representations, dated December 30,
2002 by and among the Depository, the Depositor and the Trustee.
DEPOSITORY PARTICIPANT: A broker, dealer, bank, other financial
institution or other Person for whom the Depository effects book-entry transfers
and pledges of securities deposited with the Depository.
DETERMINATION DATE: With respect to each Servicer, the day of the month
set forth as the Determination Date in the related Servicing Agreement.
DISCOUNT FRACTION: For any Discount Loan, the following fraction:
6.000% - the Net Mortgage Rate on such Discount Loan
______________________________
6.000%
DISCOUNT FRACTIONAL PRINCIPAL AMOUNT: On each Distribution Date, the
aggregate of the following with respect to each Discount Loan: an amount equal
to the product of the related Discount Fraction multiplied by the sum of (i) the
amounts described in the definition of Principal Distribution Amount for such
Distribution Date allocable to such Discount Loan, (ii) the amounts described in
the definition of Principal Prepayment Amount with respect to such Distribution
Date allocable to such Discount Loan and (iii) Liquidation Principal with
respect to such Distribution Date allocable to such Discount Loan.
DISCOUNT FRACTIONAL PRINCIPAL SHORTFALL: For any Distribution Date the
aggregate of the following with respect to each Discount Loan: an amount equal
to the related Discount Fraction of any Realized Loss incurred with respect to
such Discount Loan during the related Prepayment Period, other than a Special
Hazard Loss, Fraud Loss or Bankruptcy Loss in excess of the Special Hazard
Coverage, Fraud Coverage or Bankruptcy Coverage, as applicable.
DISCOUNT LOAN: The Loans having Net Mortgage Rates as of the Cut-Off
Date of less than or equal to 6.000%.
DISQUALIFIED ORGANIZATION: A "disqualified organization" as defined in
Section 860E(e)(5) of the Code, and, for purposes of Section 5.1 herein, as
defined in Section 5.1(b).
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DISTRIBUTION ACCOUNT: The trust account or accounts created and
maintained by the Trustee pursuant to Section 3.25 in the name of the Trustee
for the benefit of the Certificateholders and designated "Bank One, National
Association, in trust for registered holders of Deutsche Mortgage Securities,
Inc. Mortgage Loan Trust, Series 2002-1". Funds in the Distribution Account
shall be held in trust for the Certificateholders for the uses and purposes set
forth in this Agreement. The Distribution Account must be an Eligible Account.
DISTRIBUTION ACCOUNT DEPOSIT DATE: The Business Day prior to such
Distribution Date.
DISTRIBUTION DATE: With respect to distributions on the Certificates,
the 25th day (or, if such 25th day is not a Business Day, the Business Day
immediately succeeding such 25th day) of each month, with the first such date
being January 27, 2003. The "related Due Date" for any Distribution Date is the
Due Date immediately preceding such Distribution Date.
DUE DATE: The first day of each calendar month, which is the day on
which the Monthly Payment for each Loan is due. The "related Due Date" for any
Distribution Date is the Due Date immediately preceding such Distribution Date.
ELIGIBLE ACCOUNT: Any account or accounts held and established by the
Master Servicer or the Trustee in trust for the Certificateholders at any
Eligible Institution.
ELIGIBLE INSTITUTION: An institution having (i) the highest short-term
debt rating, and one of the two highest long-term debt ratings of each Rating
Agency, (ii) with respect to the Master Servicer Collection Account, an
unsecured long-term debt rating of at least one of the two highest unsecured
long-term debt ratings of each Rating Agency, or (iii) the approval of each
Rating Agency.
ELIGIBLE INVESTMENTS: Any one or more of the following obligations or
securities payable on demand or having a scheduled maturity on or before the
Business Day preceding the following Distribution Date (or, with respect to the
Distribution Account maintained with the Trustee, having a scheduled maturity on
or before the following Distribution Date; provided that, such Eligible
Investments shall be managed by, or an obligation of, the institution that
maintains the Distribution Account if such Eligible Investments mature on the
Distribution Date), regardless of whether any such obligation is issued by the
Depositor, the applicable Servicer, the Trustee, the Master Servicer, the
Securities Administrator or any of their respective Affiliates and having at the
time of purchase, or at such other time as may be specified, the required
ratings, if any, provided for in this definition:
(a) direct obligations of, or guaranteed as to full and timely
payment of principal and interest by, the United States or any agency or
instrumentality thereof, provided, that such obligations are backed by the full
faith and credit of the United States of America;
(b) direct obligations of, or guaranteed as to timely payment
of principal and interest by, FHLMC, FNMA or the Federal Farm Credit System,
provided, that any such obligation, at the time of purchase or contractual
commitment providing for the purchase thereof, is qualified by each
12
Rating Agency as an investment of funds backing securities rated "AAA" in the
case of S&P and Fitch (the initial rating of the Class A Certificates);
(c) demand and time deposits in or certificates of deposit of,
or bankers' acceptances issued by, any bank or trust company, savings and loan
association or savings bank, provided, that the short-term deposit ratings
and/or long-term unsecured debt obligations of such depository institution or
trust company (or in the case of the principal depository institutions in a
holding company system, the commercial paper or long-term unsecured debt
obligations of such holding company) have, in the case of commercial paper, the
highest rating available for such securities by each Rating Agency and, in the
case of long-term unsecured debt obligations, one of the two highest ratings
available for such securities by each Rating Agency, or in each case such lower
rating as will not result in the downgrading or withdrawal of the rating or
ratings then assigned to any Class of Certificates by any Rating Agency but in
no event less than the initial rating of the Senior Certificates;
(d) general obligations of or obligations guaranteed by any
state of the United States or the District of Columbia receiving one of the two
highest long-term debt ratings available for such securities by each Rating
Agency, or such lower rating as will not result in the downgrading or withdrawal
of the rating or ratings then assigned to any Class of Certificates by any
Rating Agency;
(e) commercial or finance company paper (including both
non-interest-bearing discount obligations and interest-bearing obligations
payable on demand or on a specified date not more than one year after the date
of issuance thereof) that is rated by each Rating Agency in its highest
short-term unsecured rating category at the time of such investment or
contractual commitment providing for such investment, and is issued by a
corporation the outstanding senior long-term debt obligations of which are then
rated by each Rating Agency in one of its two highest long-term unsecured rating
categories, or such lower rating as will not result in the downgrading or
withdrawal of the rating or ratings then assigned to any Class of Certificates
by any Rating Agency but in no event less than the initial rating of the Senior
Certificates;
(f) guaranteed reinvestment agreements issued by any bank,
insurance company or other corporation rated in one of the two highest rating
levels available to such issuers by each Rating Agency at the time of such
investment, provided, that any such agreement must by its terms provide that it
is terminable by the purchaser without penalty in the event any such rating is
at any time lower than such level;
(g) repurchase obligations with respect to any security
described in clause (a) or (b) above entered into with a depository institution
or trust company (acting as principal) meeting the rating standards described in
(c) above;
(h) securities bearing interest or sold at a discount that are
issued by any corporation incorporated under the laws of the United States of
America or any State thereof and rated by each Rating Agency in one of its two
highest long-term unsecured rating categories at the time of such
13
investment or contractual commitment providing for such investment; provided,
however, that securities issued by any such corporation will not be Eligible
Investments to the extent that investment therein would cause the outstanding
principal amount of securities issued by such corporation that are then held as
part of the Distribution Account to exceed 20% of the aggregate principal amount
of all Eligible Investments then held in the Distribution Account;
(i) units of taxable money market funds (including those for
which the Trustee, the Master Servicer or any affiliate thereof receives
compensation with respect to such investment) which funds have been rated by
each Rating Agency rating such fund in its highest rating category or which have
been designated in writing by each Rating Agency as Eligible Investments with
respect to this definition;
(j) if previously confirmed in writing to the Trustee, any
other demand, money market or time deposit, or any other obligation, security or
investment, as may be acceptable to each Rating Agency as a permitted investment
of funds backing securities having ratings equivalent to the initial rating of
the Class A Certificates; and
(k) such other obligations as are acceptable as Eligible
Investments to each Rating Agency;
provided, however, that such instrument continues to qualify as a "cash flow
investment" pursuant to Code Section 860G(a)(6) and that no instrument or
security shall be an Eligible Investment if (i) such instrument or security
evidences a right to receive only interest payments or (ii) the right to receive
principal and interest payments derived from the underlying investment provides
a yield to maturity in excess of 120% of the yield to maturity at par of such
underlying investment.
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
EXCESS LIQUIDATION PROCEEDS: With respect to any Distribution Date, the
excess, if any, of aggregate Liquidation Proceeds in the applicable Prepayment
Period over the amount that would have been received if a Payoff had been made
on the last day of such applicable Prepayment Period with respect to each Loan
which became a Liquidated Loan during such applicable Prepayment Period.
EXCESS LOSS: A Special Hazard Loss incurred on a Loan in excess of the
Special Hazard Coverage, a Fraud Loss incurred on a Loan in excess of the Fraud
Coverage and a Bankruptcy Loss incurred on a Loan in excess of the Bankruptcy
Coverage.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended.
XXXXXX XXX: Xxxxxx Xxx, formerly known as the Federal National Mortgage
Association, or any successor thereto.
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FDIC: Federal Deposit Insurance Corporation, or any successor thereto.
FITCH: Fitch Ratings, provided, that at anytime it is a Rating Agency.
FRAUD COVERAGE: As of the Cut-Off Date approximately $6,255,474, and
thereafter, the Fraud Coverage will generally be equal to (1) prior to the
fourth Anniversary, an amount equal to 1.00% of the aggregate Principal Balance
of all Loans as of the Cut-Off Date minus the aggregate amounts allocated to the
Certificates with respect to Fraud Losses on such Loans up to such date of
determination and (2) from the fourth to the fifth Anniversary, an amount equal
to (a) 0.50% of the aggregate Principal Balance of all of the Loans as of the
Due Date of the calendar month preceding the most recent Anniversary minus (b)
the aggregate amounts allocated to the Certificates with respect to Fraud Losses
on the Loans since the most recent Anniversary up to such date of determination.
On and after the fifth Anniversary, the Fraud Coverage will be zero. Fraud
Coverage may be reduced upon written confirmation from each Rating Agency that
such reduction will not adversely affect the then current ratings assigned to
the Certificates by each Rating Agency.
FRAUD LOSS: The occurrence of a loss on a Loan, as reported by the
related Servicer, arising from any action, event or state of facts with respect
to such Loan which, because it involved or arose out of any dishonest,
fraudulent, criminal, negligent or knowingly wrongful act, error or omission by
the Mortgagor, originator (or assignee thereof) of such Loan, Lender, or the
related Servicer, would result in an exclusion from, denial of, or defense to
coverage which otherwise would be provided by an insurance policy previously
issued with respect to such Loan.
XXXXXXX MAC: The Federal Home Loan Mortgage Corporation, or any
successor thereto.
HSBC: HSBC Mortgage Corporation (USA), or any successor thereto.
HSBC SERVICING AGREEMENT: Shall mean the Master Mortgage Loan Purchase
and Servicing Agreement, dated as of December 1, 2002, between the Seller and
HSBC Mortgage Corporation (USA) (as modified pursuant to the related Assignment
Agreement).
INDEPENDENT: When used with respect to any specified Person, any such
Person who (i) is in fact independent of the Depositor, each Servicer and the
Master Servicer, (ii) does not have any direct financial interest or any
material indirect financial interest in the Depositor, each Servicer or the
Master Servicer or any Affiliate of either and (iii) is not connected with the
Depositor, each Servicer or the Master Servicer as an officer, employee,
promoter, underwriter, trustee, partner, director or person performing similar
functions.
INDIRECT DEPOSITORY PARTICIPANTS: Entities such as banks, brokers,
dealers or trust companies that clear through or maintain a custodial
relationship with a Depository Participant, either directly or indirectly.
15
INSURANCE PROCEEDS: Proceeds of any title policy, hazard policy or
other insurance policy covering a Loan, to the extent such proceeds are not to
be applied to the restoration of the related Mortgaged Property or released to
the Mortgagor in accordance with the applicable Servicing Agreement.
INTEREST ACCRUAL PERIOD: With respect to each Distribution Date and all
Certificates (other than the Class A-3, Class A-4, Class A-8 and Class A-9
Certificates) the calendar month preceding the month in which the Distribution
Date occurs. With respect to each Distribution Date and the Class A-3, Class
A-4, Class A-8 and Class A-9 Certificates, the period from the 25th day of the
month before the month in which such Distribution Date occurs through the 24th
day of the month in which such Distribution Date occurs.
INTEREST DISTRIBUTION AMOUNT: On any Distribution Date, for any Class
of Certificates (other than the Principal Only Certificates), the amount of
interest accrued on the respective Class Principal Balance or Class Notional
Amount, as applicable, during the applicable Interest Accrual Period, equal to
(a) the product of (1) 1/12th of the related Remittance Rate for such Class and
(2) the respective Class Principal Balance or Class Notional Amount, as
applicable, before giving effect to allocations of Realized Losses in connection
with such Distribution Date or distributions to be made on such Distribution
Date, reduced by (b) Uncompensated Interest Shortfall and the interest portion
of Realized Losses allocated to such Class pursuant to the definition of
"Uncompensated Interest Shortfall" and Section 4.2, respectively. The Interest
Distribution Amount for the Principal Only Certificates on any Distribution Date
shall equal zero.
INTEREST ONLY CERTIFICATES: The Class A-4 and Class A-X Certificates.
JUNIOR SUBORDINATE CERTIFICATES: The Class B-3, B-4 and B-5
Certificates, collectively.
LIBOR: The per annum rate determined by the Securities Administrator on
the related LIBOR Determination Date on the basis of the offered rate for
one-month U.S. dollar deposits, as such rate appears on Telerate Page 3750 as of
11:00 a.m. (London time) on such LIBOR Determination Date; provided that if such
rate does not appear on Telerate Page 3750, the rate for such date will be
determined on the basis of the offered rates of the Reference Banks for
one-month U.S. dollar deposits, as of 11:00 a.m. (London time) on such LIBOR
Determination Date. In such event, the Securities Administrator will request the
principal London office of each of the Reference Banks to provide a quotation of
its rate. If on such LIBOR Determination Date, two or more Reference Banks
provide such offered quotations, LIBOR for the related Interest Accrual Period
shall be the arithmetic mean of such offered quotations (rounded upwards if
necessary to the nearest whole multiple of 1/16). If on such LIBOR Determination
Date, fewer than two Reference Banks provide such offered quotations, LIBOR for
the related Interest Accrual Period shall be the higher of (i) LIBOR as
determined on the previous LIBOR Determination Date and (ii) the Reserve
Interest Rate. Notwithstanding the foregoing, if, under the priorities described
above, LIBOR for an LIBOR Determination Date would be based on LIBOR for the
previous LIBOR Determination Date for the third consecutive LIBOR Determination
Date, the Securities Administrator shall select an alternative
16
comparable index (over which the Securities Administrator has no control), used
for determining one-month Eurodollar lending rates that is calculated and
published (or otherwise made available) by an independent party. The
establishment of LIBOR and the interest rate on the Adjustable Rate Certificates
by the Securities Administrator for the relevant Interest Accrual Period, shall,
in the absence of manifest error, be final and binding.
LIBOR BUSINESS DAY: Means any day other than (i) a Saturday or a Sunday
or (ii) a day on which banking institutions in the city of London, England or in
city of New York, New York are required or authorized by law to be closed.
LIBOR DETERMINATION DATE: Means for any Distribution Date, the second
LIBOR Business Day before the first day of the related Interest Accrual Period.
LIQUIDATED LOAN: A Loan as to which a Servicer has determined in
accordance with its customary servicing practices that all amounts which it
expects to recover from or on account of such Loan, whether from Insurance
Proceeds, Liquidation Proceeds or otherwise, have been recovered. For purposes
of this definition, acquisition of a Mortgaged Property by the Trust Fund shall
not constitute final liquidation of the related Loan.
LIQUIDATION EXPENSES: Reasonable out of pocket expenses incurred by a
Servicer in connection with the liquidation of any defaulted Loan or property
acquired in respect thereof, including, without limitation, legal fees and
expenses, any unreimbursed amount expended by such Servicer pursuant to the
related Servicing Agreement respecting the related Loan and any unreimbursed
expenditures for real property taxes or for property restoration or preservation
relating to the Mortgaged Property that secured such Loan.
LIQUIDATION PRINCIPAL: The principal portion of Liquidation Proceeds
received with respect to each Loan which became a Liquidated Loan (but not in
excess of the Principal Balance thereof) during the applicable Prepayment
Period.
LIQUIDATION PROCEEDS: The amount (other than Insurance Proceeds or
amounts received in respect of the rental of any REO Property prior to REO
Disposition) received by the applicable Servicer pursuant to the related
Servicing Agreement or the Master Servicer in connection with (i) the taking of
all or a part of a Mortgaged Property by exercise of the power of eminent domain
or condemnation, (ii) the liquidation of a defaulted Loan through a trustee's
sale, foreclosure sale or otherwise, or (iii) the repurchase, substitution or
sale of a Loan or an REO Property pursuant to or as contemplated by Section 2.3
or Section 9.1.
LOAN DOCUMENTS: The documents evidencing or relating to each Loan
delivered to the Custodian under the Custodial Agreement on behalf of the
Trustee.
LOAN SCHEDULE: The schedule, as amended from time to time, of Loans
attached hereto as Exhibit D, which shall set forth as to each Loan the
following, among other things:
17
(i) the loan number of the Loan and name of the related Mortgagor;
(ii) the street address of the Mortgaged Property including city, state and zip
code;
(iii) the Mortgage Interest Rate as of the Cut-Off Date;
(iv) the original term and maturity date of the related Mortgage Note;
(v) the original Principal Balance;
(vi) the first payment date;
(vii) the Monthly Payment in effect as of the Cut-Off Date;
(viii) the date of the last paid installment of interest;
(ix) the unpaid Principal Balance as of the close of business on the Cut-Off Date;
(x) the Loan-to-Value ratio at origination;
(xi) the type of property and the Original Value of the Mortgaged Property;
(xii) whether a primary mortgage insurance policy is in effect as of the Cut-Off
Date; and
(xiii) the nature of occupancy at origination;
LOANS: The Mortgages and the related Mortgage Notes, each transferred
and assigned to the Trustee pursuant to the provisions hereof as from time to
time are held as part of the Trust Fund, as so identified in the Loan Schedule.
Each of the Loans is referred to individually in this Agreement as a "Loan".
LOAN-TO-VALUE RATIO: The original principal amount of a Loan divided by
the Original Value; however, references to "current Loan-to-Value Ratio" shall
mean the then current Principal Balance of a Loan divided by the Original Value.
LOCKOUT PERCENTAGE: For any Distribution Date, will equal (i) the sum
of (x) the Class A-17 Class Principal Balance and (y) the Class A-18 Class
Principal Balance; divided by (ii) the aggregate Scheduled Principal Balance of
all Loans immediately preceding the Distribution Date (exclusive of the
applicable Discount Fraction of the Scheduled Principal Balance of each Discount
Loan).
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LOCKOUT PRINCIPAL AMOUNT: For any Distribution Date will equal the
product of (i) the Lockout Percentage; (ii) the Step Down Percentage; and (iii)
the sum of (A) the Principal Distribution Amount for such Distribution Date
(exclusive of the portion thereof attributable to the Discount Fractional
Principal Amount); (B) the Principal Prepayment Amount for such Distribution
Date (exclusive of the portion thereof attributable to the Discount Fractional
Principal Amount); and (C) the Liquidation Principal for such Distribution Date
(exclusive of the portion thereof attributable to the Discount Fractional
Principal Amount).
MASTER SERVICER: As of the Closing Date, Xxxxx Fargo Bank Minnesota,
National Association and thereafter, its respective successors in interest who
meet the qualifications of this Agreement. The Master Servicer and the
Securities Administrator shall at all times be the same Person.
MASTER SERVICER COLLECTION ACCOUNT: The account or accounts created and
maintained, or caused to be created and maintained, by the Master Servicer
pursuant to Section 3.23, which shall be denominated "Bank One, National
Association, as Trustee f/b/o holders of Deutsche Mortgage Securities Inc.
Mortgage Loan Trust, Series 2002-1 - Master Servicer Collection Account". The
Collection Account must be an Eligible Account.
MASTER SERVICER EVENT OF DEFAULT: One or more of the events described
in Section 7.1 hereof.
MASTER SERVICER FEE RATE: 0.005% per annum.
MASTER SERVICING FEE: With respect to each Loan and for any calendar
month, an amount equal to one twelfth of the product of the Master Servicer Fee
Rate multiplied by the Scheduled Principal Balance of the Loans as of the Due
Date in the preceding calendar month.
MONTHLY PAYMENT: The scheduled payment of principal and interest on a
Loan which is due on the related Due Date for such Loan after giving effect to
any reduction in the amount of interest collectible from any Mortgagor pursuant
to the Relief Act.
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 Loan Documents pertaining to a particular Loan.
MORTGAGE INTEREST RATE: For any Loan, the per annum rate at which
interest accrues on such Loan pursuant to the terms of the related Mortgage Note
without regard to any reduction thereof as a result of the Relief Act.
MORTGAGE LOAN PURCHASE AGREEMENT: The Mortgage Loan Purchase Agreement
dated as of December 30, 2002, between the Depositor and the Seller.
19
MORTGAGE NOTE: The note or other evidence of indebtedness evidencing
the indebtedness of a Mortgagor under a Loan.
MORTGAGE POOL: All of the Loans.
MORTGAGED PROPERTY: With respect to any Loan, the real property,
together with improvements thereto, securing the indebtedness of the Mortgagor
under the related Loan.
MORTGAGOR: The obligor on a Mortgage Note.
NATIONAL CITY: National City Mortgage Co., or any successor thereto.
NATIONAL CITY SERVICING AGREEMENT: The Master Seller's Warranties and
Servicing Agreement, dated as of October 1, 2002 between the Seller and National
City as amended by Amendment Number One dated as of October 1, 2002 between the
Seller and National City (as modified pursuant to the related Assignment
Agreement).
NET MORTGAGE RATE: For each Loan and for any date of determination, a
per annum rate equal to the Mortgage Interest Rate for such Loan less the
applicable per annum percentage rate of the Servicing Fee and the Master
Servicing Fee.
NONRECOVERABLE ADVANCE: With respect to any Loan, any Advance or
Servicing Advance which the related Servicer or Master Servicer shall have
determined to be a Nonrecoverable Advance pursuant to the related Servicing
Agreement or Section 4.4, respectively, and which was, or is proposed to be,
made by such Servicer or the Master Servicer.
NON-U.S. PERSON: A Person that is not a U.S. Person.
OFFICER'S CERTIFICATE: With respect to any Person, a certificate signed
by the Chairman of the Board, the President or a Vice-President, however
denominated, of such Person (or, in the case of a Person which is not a
corporation, signed by the person or persons having like responsibilities), and
delivered to the Trustee.
OPINION OF COUNSEL: A written opinion of counsel, who may, without
limitation, be salaried counsel for the Depositor, a Servicer, the Securities
Administrator or the Master Servicer, acceptable to the Trustee, except that any
opinion of counsel relating to (a) the qualification of any REMIC as a REMIC or
(b) compliance with the REMIC Provisions must be an opinion of Independent
counsel.
ORIGINAL VALUE: With respect to any Loan other than a Loan originated
for the purpose of refinancing an existing mortgage debt, the lesser of (a) the
Appraised Value (if any) of the Mortgaged Property at the time the Loan was
originated or (b) the purchase price paid for the Mortgaged Property by the
Mortgagor. With respect to a Loan originated for the purpose of refinancing
existing mortgage debt, the Original Value shall be equal to the lesser of (a)
the
20
Appraised Value of the Mortgaged Property at the time the Loan was originated or
(b) the appraised value at the time the refinanced mortgage debt was incurred.
OTS: The Office of Thrift Supervision, or any successor thereto.
OWNERSHIP INTEREST: As defined in Section 5.1(b)
PASS-THROUGH ENTITY: As defined in Section 5.1(b)
PAYOFF: Any Mortgagor payment of principal on a Loan equal to the
entire outstanding Principal Balance of such Loan, if received in advance of the
last scheduled Due Date for such Loan and accompanied by an amount of interest
equal to accrued unpaid interest on the Loan to the date of such
payment-in-full.
PERCENTAGE INTEREST: (a) With respect to the right of each
Certificateholder of a particular Class in the distributions allocated to such
Class, "Percentage Interest" shall mean the percentage undivided beneficial
ownership interest evidenced by such Certificate of such Class, which percentage
shall equal:
(i) with respect to any Regular Interest Certificate (other
than the Interest Only Certificates), its Certificate Principal Balance
divided by the applicable Class Principal Balance;
(ii) with respect to the Interest Only Certificates, the
portion of the respective Class Notional Amount evidenced by such
Certificate divided by the respective Class Notional Balance; and
(iii) with respect to the Class R Certificate, the percentage
set forth on the face of such Certificate.
(b) With respect to the rights of each Certificate in connection with
Sections 5.9, 7.4 and 11.1, "Percentage Interest" shall mean the percentage
undivided beneficial interest evidenced by such Certificate in the Trust Fund,
which for purposes of such rights only shall equal:
(i) with respect to any Certificate (other than the Interest
Only Certificates), the product of (x) 98.00% and (y) the percentage
calculated by dividing its Certificate Principal Balance by the
Aggregate Certificate Principal Balance; provided, however, that the
product in (x) above shall be increased by one percent (1%) upon each
retirement of an Interest Only Certificate;
(ii) with respect to each Interest Only Certificate, one
percent (1%) of such Certificate Percentage Interest as calculated by
paragraph (a)(ii) of this definition; and
21
(iii) with respect to the Class R Certificate, zero.
PERMITTED TRANSFEREE: With respect to the holding or ownership of any
Residual Certificate, any Person other than (i) the United States, a State or
any political subdivision thereof, or any agency or instrumentality of any of
the foregoing, (ii) a foreign government or International Organization, or any
agency or instrumentality of either of the foregoing, (iii) an organization
(except certain farmers' cooperatives described in Code Section 521) which is
exempt from the taxes imposed by Chapter 1 of the Code (unless such organization
is subject to the tax imposed by Section 511 of the Code on unrelated business
taxable income), (iv) rural electric and telephone cooperatives described in
Code Section 1381(a)(2)(C), (v) any electing large partnership under Section 775
of the Code, (vi) any Person from whom the Trustee or the Certificate Registrar
has not received an affidavit to the effect that it is not a "disqualified
organization" within the meaning of Section 860E(e)(5) of the Code, and (vii)
any other Person so designated by the Depositor based upon an Opinion of Counsel
that the transfer of an Ownership Interest in a Residual Certificate to such
Person may cause the Trust Fund to fail to qualify as a REMIC at any time that
the Certificates are outstanding. The terms "United States," "State" and
"International Organization" shall have the meanings set forth in Code Section
7701 or successor provisions. A corporation shall not be treated as an
instrumentality of the United States or of any State or political subdivision
thereof if all of its activities are subject to tax, and, with the exception of
the Xxxxxxx Mac, a majority of its board of directors is not selected by such
governmental unit.
PERSON: Any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
PLAN: As defined in Section 5.1(d).
PLANNED PRINCIPAL BALANCE: For any Distribution Date, the amount set
forth in the table attached hereto as Exhibit M for such Distribution Date, for
the Class A-1, Class A-2 , Class A-3 and Class A-5 Certificates.
PREMIUM LOANS: The Loans having Net Mortgage Rates as of the Cut-Off
Date in excess of 6.000% per annum.
PREPAID MONTHLY PAYMENT: Any Monthly Payment received prior to its
scheduled Due Date, which is intended to be applied to a Loan on its scheduled
Due Date and held in the related Protected Account until the related Servicer
Remittance Date following its scheduled Due Date.
PREPAYMENT INTEREST SHORTFALL: For any Distribution Date, for any Loan
on which a Payoff was made by a Mortgagor during the related Prepayment Period,
an amount equal to one month's interest at the applicable Net Mortgage Rate on
such Loan less the amount of interest actually paid by the Mortgagor with
respect to such Payoff.
22
PREPAYMENT PERIOD: The calendar month immediately preceding any
Distribution Date.
PRINCIPAL BALANCE: At the time of any determination, the principal
balance of a Loan remaining to be paid at the close of business on the Cut-Off
Date, after deduction of all principal payments due on or before the Cut-Off
Date whether or not paid, reduced by all amounts distributed or to be
distributed to Certificateholders through the Distribution Date in the month of
determination that are reported as allocable to principal of such Loan. In the
case of a Substitute Loan, "Principal Balance" shall mean, at the time of any
determination, the principal balance of such Substitute Loan transferred to the
Trust Fund on the date of substitution, reduced by all amounts distributed or to
be distributed to Certificateholders through the Distribution Date in the month
of determination that are reported as allocable to principal of such Substitute
Loan.
PRINCIPAL DISTRIBUTION AMOUNT: On any Distribution Date and for the
Loans, the sum with respect to the Loans of (i) the scheduled principal payments
on the Loans due on the related Due Date, (ii) the principal portion of
repurchase proceeds received with respect to any Loan which was repurchased by
the Depositor pursuant to a Purchase Obligation or as permitted by this
Agreement prior to such Distribution Date, and (iii) any other unscheduled
payments of principal which were received with respect to any Loan during the
applicable Prepayment Period, other than Payoffs, Curtailments and Liquidation
Principal.
PRINCIPAL ONLY CERTIFICATES: The Class A-P Certificates.
PRINCIPAL PREPAYMENT: Any payment of principal on a Loan which
constitutes a Payoff or a Curtailment.
PRINCIPAL PREPAYMENT AMOUNT: On any Distribution Date and for the
Loans, the sum with respect to the Loans of (i) Curtailments received during the
applicable Prepayment Period from such Loans and (ii) Payoffs received during
the applicable Prepayment Period from the Loans.
PRO RATA ALLOCATION: The allocation of the principal portion of certain
losses relating to a Loan to the Senior Certificates (other than the Class A-P
Certificates and the Interest Only Certificates) and/or to the Subordinate
Certificates, as applicable, pro rata according to their respective Certificate
Principal Balances or, in the case of the Accrual Certificates, the Certificate
Principal Balance of the Accrual Certificate on the Closing Date, if lower
(except (1) if the loss is recognized with respect to a Discount Loan, in which
event the Discount Fraction of such loss will be allocated to the Class A-P
Certificates pro rata according to the outstanding Certificate Principal
Balances of the Class A-P Certificate, and the remainder of such loss will be
allocated as described above in this definition without regard to this
parenthetical and (2) all losses allocable to the Class A-17 Certificates will
be allocated to the Class A-18 Certificates until the Class Principal Balance
thereof has been reduced to zero) in reduction thereof, and the allocation of
the interest portion of such losses to such Certificates (other than the Class
A-P Certificates), pro rata according to the amount of interest accrued but
unpaid on each such Class in reduction thereof and then pro rata according to
their outstanding Certificate Principal Balances or, in the case of the Accrual
23
Certificates, the Certificate Principal Balance of that Accrual Certificate on
the Closing Date, if lower, in reduction thereof.
PROTECTED ACCOUNT: An account or accounts established and maintained
for the benefit of the Certificateholders by each Servicer with respect to the
related Loans and with respect to REO Property pursuant to the applicable
Servicing Agreement.
PURCHASE OBLIGATION: An obligation of the Depositor to repurchase Loans
under the circumstances and in the manner provided in Section 2.3.
PURCHASE PRICE: With respect to any Loan to be purchased pursuant to a
Purchase Obligation, or any Loan to be purchased or repurchased relating to an
REO Property, and as confirmed by an Officers' Certificate from the Master
Servicer to the Trustee, an amount equal to the sum of (i) 100% of the Principal
Balance thereof as of the date of purchase (or such other price as provided in
Section 9.1), (ii) in the case of (x) a Loan, accrued interest on such Principal
Balance at the applicable Net Mortgage Rate in effect from time to time from the
Due Date as to which interest was last covered by a payment by the Mortgagor or
an Advance by the applicable Servicer or the Master Servicer, which payment or
Advance had as of the date of purchase been distributed pursuant to Section 4.1,
through the end of the calendar month in which the purchase is to be effected
and (y) an REO Property, the sum of (1) accrued interest on such Principal
Balance at the applicable Net Mortgage Rate in effect from time to time from the
Due Date as to which interest was last covered by a payment by the Mortgagor or
an Advance by the applicable Servicer or the Master Servicer through the end of
the calendar month immediately preceding the calendar month in which such REO
Property was acquired, 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, Liquidation Proceeds and Advances that as of the date of purchase had
been distributed as or to cover REO Imputed Interest in accordance with the
applicable Servicing Agreement, (iii) any unreimbursed Servicing Advances and
Advances (including Nonrecoverable Advances) and any unpaid Servicing Fees or
Master Servicing Fees allocable to such Loan or REO Property and (iv) in the
case of a Loan required to be purchased pursuant to Section 2.3, expenses
reasonably incurred or to be incurred by the Master Servicer, the Servicers or
the Trustee in respect of the breach or defect giving rise to a Purchase
Obligation.
RATING AGENCY: Initially, each of S&P and Fitch; thereafter, each
nationally recognized statistical rating organization that has rated the
Certificates at the request of the Depositor, or their respective successors in
interest.
RATINGS: As of any date of determination, the ratings, if any, of the
Certificates as assigned by each Rating Agency.
REALIZED LOSS: For any Distribution Date, with respect to any Loan
which became a Liquidated Loan during the related Prepayment Period, the sum of
(i) the principal balance of such
24
Loan remaining outstanding and the principal portion of Nonrecoverable Advances
actually reimbursed with respect to such Loan (the principal portion of such
Realized Loss), and (ii) the accrued interest on such Loan remaining unpaid and
the interest portion of Nonrecoverable Advances actually reimbursed with respect
to such Loan (the interest portion of such Realized Loss). For any Distribution
Date, with respect to any Loan which is not a Liquidated Loan, the amount of the
Bankruptcy Loss incurred with respect to such Loan as of the related Due Date
will be treated as a Realized Loss.
RECORD DATE: The last Business Day of the month immediately preceding
the month of the related Distribution Date.
REFERENCE BANKS: Bankers Trust Company, Xxxxxxx'x Bank PLC, The Tokyo
Mitsubishi Bank and National Westminster Bank PLC and their successors in
interest; provided, however, that if any of the foregoing banks are not suitable
to serve as a Reference Bank, then any leading banks selected by the Securities
Administrator which are engaged in transactions in Eurodollar deposits in the
International Eurocurrency market (i) with an established place of business in
London, (ii) not controlling, under the control of or under common control with
the Depositor or any Affiliate thereof and (iii) which have been designated as
such by the Securities Administrator.
REGULAR INTEREST CERTIFICATES: The Certificates, other than the Class R
Certificate.
RELIEF ACT: The Soldiers' and Sailors' Civil Relief Act of 1940, as
amended.
RELIEF ACT INTEREST SHORTFALL: With respect to any Distribution Date
and Loan, any reduction in the amount of interest collectible on such Loan for
the most recently ended calendar month immediately preceding such Distribution
Date as a result of the application of the Relief Act.
REMIC: A "real estate mortgage investment conduit" within the meaning
of Section 860D of the Code.
REMIC I: The segregated pool of assets subject hereto, constituting the
primary trust created hereby and to be administered hereunder, with respect to
which a REMIC election is to be made, consisting of: (i) such Loans as from time
to time are subject to this Agreement, together with the Mortgage Files relating
thereto, and together with all collections thereon and proceeds thereof; (ii)
any REO Property, together with all collections thereon and proceeds thereof;
(iii) the Trustee's rights with respect to the Loans under all insurance
policies required to be maintained pursuant to this Agreement and any proceeds
thereof; (iv) the Depositor's rights under the Mortgage Loan Purchase Agreement
and the Assignment Agreements (including any security interest created thereby);
(v) the Master Servicer Collection Account and the Distribution Account, and
such assets that are deposited therein from time to time and any investments
thereof, together with any and all income, proceeds and payments with respect
thereto. Notwithstanding the foregoing, however, REMIC I specifically excludes
all payments and other collections of principal and interest due on the Loans on
or before the Cut-off Date.
25
REMIC I REGULAR INTERESTS: The regular interests in REMIC I as
described in Section 2.4 of this Agreement.
REMIC II: The pool of assets consisting of the REMIC I Regular
Interests and all payments of principal or interest on or with respect to the
REMIC I Regular Interests after the Cut-Off Date.
REMIC PROVISIONS: Provisions of the federal income tax law relating to
real estate mortgage investment conduits, which appear at Section 860A through
860G of the Code, and related provisions, and proposed, temporary and final
regulations and published rulings, notices and announcements promulgated
thereunder, as the foregoing may be in effect from time to time.
REMITTANCE RATE: For each Class of interest bearing Certificates (other
than the Class A-3, Class A-4, Class A-8 and Class A-9 Certificates), the per
annum rate set forth as the Remittance Rate for such Class in the Preliminary
Statement hereto. The "Remittance Rate" for the Class A-3 Certificates shall be
the Class A-3 Interest Rate. The "Remittance Rate" for the Class A-4
Certificates shall be the Class A-4 Interest Rate. The "Remittance Rate" for the
Class A-8 Certificates shall be the Class A-8 Interest Rate. The "Remittance
Rate" for the Class A-9 Certificates shall be the Class A-9 Interest Rate.
REMITTANCE REPORT: A report by the Securities Administrator pursuant to
Section 4.3.
REO DISPOSITION: The sale or other disposition of an REO Property on
behalf of REMIC I.
REO IMPUTED INTEREST: As to any REO Property, for any calendar month
during which such REO Property was at any time part of REMIC I, one month's
interest at the applicable Net Mortgage Rate on the Scheduled Principal Balance
of such REO Property (or, in the case of the first such calendar month, of the
related Loan, if appropriate) as of the close of business on the Distribution
Date in such calendar month.
REO PROPERTY: A Mortgaged Property, title to which has been acquired by
the Servicer on behalf of the Trust Fund through foreclosure, deed in lieu of
foreclosure or otherwise.
RESERVE INTEREST RATE: With respect to any LIBOR Determination Date,
the rate per annum that the Securities Administrator determines to be either (i)
the arithmetic mean (rounded upwards if necessary to the nearest whole multiple
of 1/16%) of the one-month U.S. dollar lending rates which New York City banks
selected by the Securities Administrator are quoting on the relevant LIBOR
Determination Date to the principal London offices of leading banks in the
London interbank market or (ii) in the event that the Securities Administrator
can determine no such arithmetic mean, the lowest one-month U.S. dollar lending
rate which New York City banks selected by the Securities Administrator are
quoting on such LIBOR Determination Date to leading European banks.
RESIDUAL CERTIFICATE: The Class R Certificate, which is being issued in
a single class. Components R-1 and R-2 of the Class R Certificate is hereby each
designated the sole Class of
26
"residual interests" in REMIC I and REMIC II, respectively, for purposes of
Section 860G(a)(2) of the Code.
RESIDUAL DISTRIBUTION AMOUNT: On any Distribution Date, any portion of
the Available Distribution Amount remaining after all distributions to the
Certificates pursuant to Section 4.1(a)(I) (1) through (8) or 4.1(a) (II) (1)
through (4) as applicable for such Distribution Date. (Upon termination of the
obligations created by this Agreement and the Trust Fund created hereby, the
amounts which remain on deposit in the Distribution Account after payment to the
Certificateholders of the amounts set forth in Section 9.1 of this Agreement,
and subject to the conditions set forth therein.)
RESPONSIBLE OFFICER: When used with respect to the Trustee, the Master
Servicer or the Securities Administrator, the Chairman or Vice-Chairman of the
Board of Directors or Trustees, the Chairman or Vice-Chairman of the Executive
or Standing Committee of the Board of Directors or Trustees, the President, the
Chairman of the Committee on Trust Matters, any Vice-President, any Assistant
Vice-President, the Secretary, any Assistant Secretary, the Treasurer, any
Assistant Treasurer, the Cashier, any Assistant Cashier, any Trust Officer or
Assistant Trust Officer, the Controller, any Assistant Controller or any other
officer 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 this Agreement, 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. When used
with respect to the Depositor or any other Person, the Chairman or Vice-Chairman
of the Board of Directors, the Chairman or Vice-Chairman of any executive
committee of the Board of Directors, the President, any Vice-President, the
Secretary, any Assistant Secretary, the Treasurer, any Assistant Treasurer, or
any other officer of the Depositor customarily performing functions similar to
those performed by any of the above-designated officers 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.
S&P: Standard & Poor's Ratings Services, a division of The McGraw Hill
Companies, Inc. provided, that at any time it is a Rating Agency.
SCHEDULED PRINCIPAL BALANCE: With respect to any Loan as of any
Distribution Date, the unpaid principal balance of such Loan as specified in the
amortization schedule at the time relating thereto (before any adjustment to
such schedule by reason of bankruptcy or similar proceeding or any moratorium or
similar waiver or grace period) as of the first day of the month preceding the
month of such Distribution Date, after giving effect to any previously applied
Curtailments, the payment of principal due on such first day of the month and
any reduction of the principal balance of such Loan by a bankruptcy court,
irrespective of any delinquency in payment by the related Mortgagor.
SECURITIES ACT: The Securities Act of 1933, as amended.
27
SECURITIES ADMINISTRATOR: As of the Closing Date, Xxxxx Fargo Bank
Minnesota, National Association and thereafter, its respective successors in
interest who meet the qualifications of this Agreement. The Securities
Administrator and the Master Servicer shall at all times be the same Person.
SELLER: Deutsche Bank AG New York Branch, or its successor in interest,
in its capacity as seller under the Mortgage Loan Purchase Agreement and in its
capacity as assignor under the Assignment Agreements.
SENIOR CERTIFICATES: The Class A and Class R Certificates,
collectively.
SENIOR LIQUIDATION AMOUNT: The aggregate, for each Loan which became a
Liquidated Loan during the applicable Prepayment Period, of the lesser of: (i)
the Senior Percentage of the Principal Balance of such Loan (exclusive of the
Discount Fraction thereof, if such Loan is a Discount Loan), and (ii) the Senior
Prepayment Percentage of the Liquidation Principal with respect to such Loan
(exclusive of the Discount Fraction thereof, if such Loan is a Discount Loan).
SENIOR PERCENTAGE: As of the Closing Date, approximately 97.15%, and
thereafter, with respect to any Distribution Date, the sum of the Class
Principal Balances of the Senior Certificates (other than the Class A-P
Certificates) divided by aggregate Scheduled Principal Balance of all Loans
(reduced by the Discount Fraction of the Discount Loans), in each case
immediately prior to such Distribution Date.
SENIOR PREPAYMENT PERCENTAGE: (i) On any Distribution Date occurring
before the Distribution Date in the month of January 2008, 100%; (ii) on any
other Distribution Date on which the Senior Percentage for such Distribution
Date exceeds the initial Senior Percentage as of the Cut-Off Date, 100%; and
(iii) on any other Distribution Date in each of the months of January 2008 and
thereafter, 100%, unless:
(a) the mean aggregate Principal Balance of the Loans which
are 60 or more days delinquent (including loans in foreclosure and
property held by the Trust Fund) for each of the immediately preceding
six calendar months is less than or equal to 50% of the Subordinate
Amount as of such Distribution Date, and
(b) cumulative Realized Losses on the Loans allocated to the
Subordinate Certificates are less than or equal to the following
amounts:
PERCENTAGE OF THE SUBORDINATE
DISTRIBUTION DATE OCCURRING IN AMOUNT AS OF THE CUT-OFF DATE
January 2008 through December 2008.................... 30%
January 2009 through December 2009.................... 35%
January 2010 through December 2010.................... 40%
January 2011 through December 2011.................... 45%
28
January 2012 and thereafter........................... 50%
in which case, the Senior Prepayment Percentage shall be as follows:
DISTRIBUTION DATE OCCURRING IN SENIOR PREPAYMENT PERCENTAGE
January 2003 through December 2007................ 100%
January 2008 through December 2008................ Senior Percentage + 70% of Subordinate Percentage
January 2009 through December 2009................ Senior Percentage + 60% of Subordinate Percentage
January 2010 through December 2010................ Senior Percentage + 40% of Subordinate Percentage
January 2011 through December 2011................ Senior Percentage + 20% of Subordinate Percentage
January 2012 and thereafter....................... Senior Percentage
If on any Distribution Date the allocation to the Certificates (other
than the Class A-P Certificates) of Principal Prepayments in the percentage
required would reduce the sum of the Class Principal Balances of the
Certificates (other than the Class A-P Certificates) below zero, the Senior
Prepayment Percentage for such Distribution Date shall be limited to the
percentage necessary to reduce such sum to zero. Notwithstanding the foregoing,
however, on each Distribution Date, the Class A-P Certificates will receive the
Discount Fraction of all principal payments, including, without limitation,
Principal Prepayments, received in respect of each Discount Loan.
SENIOR PRINCIPAL AMOUNT: For any Distribution Date, an amount equal to
the sum of (a) the Senior Percentage of the Principal Distribution Amount for
the Loans (exclusive of the Discount Fractional Principal Amount), (b) the
Senior Prepayment Percentage of the Principal Prepayment Amount for the Loans
(exclusive of the Discount Fractional Principal Amount) and (c) the Senior
Liquidation Amount.
SENIOR SUBORDINATE CERTIFICATES: The Class M, B-1 and B-2 Certificates,
collectively.
SERVICER: Either National City or HSBC, as applicable, or any successor
appointed under the applicable Servicing Agreement.
SERVICER REMITTANCE DATE: With respect to each Distribution Date shall
mean (i) with respect to National City, the 18th day of the calendar month in
which such Distribution Date occurs or, if such 18th day is not a Business Day,
the Business Day immediately following such 18th day and (ii) with respect to
HSBC, the 18th day of the calendar month in which such Distribution Date occurs
or, if such 18th day is not a Business Day, the Business Day immediately
preceding such 18th day.
SERVICING ADVANCES: The reasonable "out-of-pocket" costs and expenses
incurred by the applicable Servicer in connection with a default, delinquency or
other unanticipated event by the applicable Servicer in the performance of its
servicing obligations, including, but not limited to, the cost of (i) the
preservation, restoration and protection of a Mortgaged Property, (ii) any
enforcement or judicial proceedings, including foreclosures, in respect of a
particular Loan and (iii) the management (including reasonable fees in
connection therewith) and liquidation of any REO
29
Property. No Servicer shall be required to make any Servicing Advance in respect
of a Loan or REO Property that, in the good faith business judgment of such
Servicer, would not be ultimately recoverable from related Insurance Proceeds or
Liquidation Proceeds on such Loan or REO Property as provided herein.
SERVICING AGREEMENT: The National City Servicing Agreement or the HSBC
Servicing Agreement.
SERVICING FEE: With respect to each Loan and for any calendar month, an
amount equal to one twelfth of the product of the Servicing Fee Rate multiplied
by the Scheduled Principal Balance of the Loans as of the Due Date in the
preceding calendar month. The Servicing Fee is payable solely from collections
of interest on the Loans or as otherwise provided in the related Servicing
Agreement.
SERVICING FEE RATE: 0.25% per annum.
SERVICING OFFICER: Any individual involved in, or responsible for, the
administration and servicing of the Loans whose name and specimen signature
appear on a list of servicing officers furnished to the Trustee on the Closing
Date by each Servicer and the Master Servicer, as such lists may from time to
time be amended.
SPECIAL HAZARD COVERAGE: As of the Cut-Off Date approximately
$6,255,474, and thereafter on each anniversary of the Cut-Off Date, the Special
Hazard Coverage shall be reduced, but not increased, to an amount equal to the
lesser of (1) the greatest of (a) the aggregate Principal Balance of the Loans
located in the single California zip code area containing the largest aggregate
Principal Balance of the Loans, (b) 1.00% of the aggregate unpaid Principal
Balance of the Loans and (c) twice the unpaid Principal Balance of the largest
single Loan, in each case calculated as of the Due Date in the immediately
preceding month, and (2) the initial Special Hazard Coverage amount of
$6,255,474 as reduced by the Special Hazard Losses allocated to the Certificates
since the Cut-Off Date. Special Hazard Coverage may be reduced upon written
confirmation from each Rating Agency that such reduction will not adversely
affect the then current ratings assigned to the Certificates by each Rating
Agency.
SPECIAL HAZARD LOSS: The occurrence of any direct physical loss or
damage to a Mortgaged Property, as reported by the related Servicer, not covered
by a standard hazard maintenance policy with extended coverage which is caused
by or results from any cause except: (i) fire, lightning, windstorm, hail,
explosion, riot, riot attending a strike, civil commotion, vandalism, aircraft,
vehicles, smoke, sprinkler leakage, except to the extent of that portion of the
loss which was uninsured because of the application of a co-insurance clause of
any insurance policy covering these perils; (ii) normal wear and tear, gradual
deterioration, inherent vice or inadequate maintenance of all or part thereof;
(iii) errors in design, faulty workmanship or materials, unless the collapse of
the property or a part thereof ensues and then only for the ensuing loss; (iv)
nuclear reaction or nuclear radiation or radioactive contamination, all whether
controlled or uncontrolled and whether such loss
30
be direct or indirect, proximate or remote or be in whole or in part caused by,
contributed to or aggravated by a peril covered by this definition of Special
Hazard Loss; (v) hostile or warlike action in time of peace or war, including
action in hindering, combating or defending against an actual, impending or
expected attack (a) by any government or sovereign power (dejure or defacto), or
by an authority maintaining or using military, naval or air forces, (b) by
military, naval or air forces, or (c) by an agent of any such government, power,
authority or forces; (vi) any weapon of war employing atomic fission or
radioactive force whether in time of peace or war; (vii) insurrection,
rebellion, revolution, civil war, usurped power or action taken by governmental
authority in hindering, combating or defending against such occurrence; or
(viii) seizure or destruction under quarantine or customs regulations, or
confiscation by order of any government or public authority.
STARTUP DAY: With respect to each Trust REMIC, the day designated as
such pursuant to Section 10.1(b) hereof.
STEP DOWN PERCENTAGE: For any Distribution Date will be the percentage
indicated below:
DISTRIBUTION DATE OCCURRING IN STEP DOWN PERCENTAGE
January 2003 through December 2007........... 0%
January 2008 through December 2008........... 30%
January 2009 through December 2009........... 40%
January 2010 through December 2010........... 60%
January 2011 through December 2011........... 80%
January 2012 and thereafter.................. 100%
SUBORDINATE AMOUNT: On any date of determination, the excess of the
aggregate Scheduled Principal Balance of the Loans as of such date over the
aggregate Certificate Principal Balances of the Senior Certificates then
outstanding.
SUBORDINATE CERTIFICATES: The Class M, Class B-1, Class B-2, Class B-3,
Class B-4 and Class B-5 Certificates, collectively, and designated as such on
the face thereof in substantially the form attached hereto as Exhibits A-21
through A-26, respectively and for purposes of this Agreement, the "order of
seniority" from highest to lowest of such certificates shall be the order
designated in the beginning of this definition.
SUBORDINATE LIQUIDATION AMOUNT: The excess, if any, of the aggregate of
Liquidation Principal for all the Loans which became Liquidated Loans during the
applicable Prepayment Period, over the sum of (i) the applicable Discount
Fraction of Liquidation Principal received with respect to each Discount Loan,
if any, during the applicable Prepayment Period and (ii) the related Senior
Liquidation Amount for such Distribution Date.
SUBORDINATE PERCENTAGE: As of the Closing Date approximately 2.85%, and
thereafter, with respect to any Distribution Date, the excess of 100% over the
Senior Percentage for such date.
31
SUBORDINATE PREPAYMENT PERCENTAGE: As of the Closing Date,
approximately 0%, and thereafter, with respect to any Distribution Date, the
excess of 100% over the Senior Prepayment Percentage.
SUBORDINATE PRINCIPAL AMOUNT: On any Distribution Date, will be equal
to the sum of:
(1) the Subordinate Percentage of the Principal Distribution
Amount (exclusive of the portion thereof attributable to the Discount Fractional
Principal Amount);
(2) the Subordinate Principal Prepayment Amount; and
(3) the Subordinate Liquidation Amount;
provided, however, that the Subordinate Principal Amount shall be reduced by the
amounts required to be distributed to the Principal Only Certificates with
respect to the Discount Fractional Principal Shortfall on such Distribution
Date. Any reduction in the Subordinate Principal Amount pursuant to the
foregoing proviso shall offset the amount calculated pursuant to clause (1),
clause (3) and clause (2), in such order of priority. On any Distribution Date,
the Subordinate Principal Amount shall be allocated pro rata, by Class Principal
Balance, among the Classes of Subordinate Certificates and paid in the order of
distribution to such Classes pursuant to Section 4.1.
SUBORDINATE PRINCIPAL PREPAYMENT AMOUNT: On any Distribution Date, the
Subordinate Prepayment Percentage of the Principal Prepayment Amount for the
Loans (exclusive of the portion thereof attributable to the Discount Fractional
Principal Amount).
SUBORDINATION LEVEL: On any specified date, with respect to any Class
of Subordinate Certificates, the percentage obtained by dividing: (1) the sum of
the Class Principal Balances of all Classes of Certificates which are
subordinate in right of payment to such Class as of such date before giving
effect to distributions or allocations of Realized Losses on the Loans on such
date; by (2) the sum of the Class Principal Balances of all Classes of
Certificates as of such date before giving effect to distributions or
allocations of Realized Losses on the Loans on such date.
SUBSTITUTE LOAN: A mortgage loan substituted for a Deleted 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 the Scheduled Principal Balance of the
Deleted Loan as of the Due Date in the calendar month during which the
substitution occurs, (ii) have a Mortgage Interest Rate not less than (and not
more than one percentage point in excess of) the Mortgage Interest Rate of the
Deleted Loan, (iii) have a remaining term to maturity not greater than (and not
more than one year less than) that of the Deleted Loan, (iv) have the same Due
Date as the Due Date on the Deleted Loan, (v) have a Loan-to-Value Ratio as of
the date of substitution equal to or lower than the Loan-to-Value Ratio of the
Deleted Loan as of such date, (vi) have a risk grading at least equal to the
risk grading assigned on the Deleted Loan, (vii) is a "qualified mortgage" as
defined in
32
the REMIC Provisions and (vii) conform to each representation and warranty set
forth in Section 6 of the Mortgage Loan Purchase Agreement applicable to the
Deleted Loan. In the event that one or more mortgage loans are substituted for
one or more Deleted Loans, the amounts described in clause (i) hereof shall be
determined on the basis of aggregate principal balances, the Mortgage Interest
Rates described in clause (ii) hereof shall be determined on the basis of
weighted average Mortgage Interest Rates, the terms described in clause (iii)
hereof shall be determined on the basis of weighted average remaining term to
maturity, the Loan-to-Value Ratios described in clause (v) hereof shall be
satisfied as to each such mortgage loan, the risk gradings described in clause
(vi) 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 (vii) hereof must be satisfied as to each Substitute Loan or
in the aggregate, as the case may be. In the event that the Deleted Loan is a
Discount Loan, the Substitute Loan(s) shall be deemed to be a Discount Loan(s)
regardless of the Net Mortgage Rate thereof.
TARGETED PRINCIPAL BALANCE: For any Distribution Date, the amount set
forth in the table attached hereto as Exhibit N for such Distribution Date, for
the Class A-6 and Class A-7 Certificates.
TAX MATTERS PERSON: The Holder of the Class R Certificate issued
hereunder or any Permitted Transferee of such Class R Certificateholder shall be
the initial "tax matters person" for REMIC I and REMIC II within the meaning of
Section 6231(a)(7) of the Code. For tax years commencing after any transfer of
the Class R Certificate, the holder of the greatest Percentage Interest in the
Class R Certificate at year end shall be designated as the Tax Matters Person
with respect to that year. If the Tax Matters Person becomes a Disqualified
Organization, the last preceding Holder of such Authorized Denomination of the
Class R Certificate that is not a Disqualified Organization shall be Tax Matters
Person pursuant to Section 5.1(c). If any Person is appointed as tax matters
person by the Internal Revenue Service pursuant to the Code, such Person shall
be Tax Matters Person.
TERMINATION PRICE: As defined in Section 9.1.
TERMINATOR: As defined in Section 9.1.
TRANSFER: As defined in Section 5.1(b).
TRANSFEREE: As defined in Section 5.1(b).
TRANSFEREE AFFIDAVIT AND AGREEMENT: As defined in Section 5.1(c)(i)(B).
TRUST FUND: Collectively, all of the assets of REMIC I and REMIC II,
and any amounts on deposit therein and any proceeds thereof.
TRUSTEE: Bank One, National Association, a national banking
association, or its successor in interest, or any successor trustee appointed as
herein provided.
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UNCOLLECTED INTEREST: With respect to any Distribution Date the sum of
(i) the aggregate Prepayment Interest Shortfall for such Distribution Date and
(ii) the aggregate Curtailment Shortfall for such Distribution Date.
UNCOMPENSATED INTEREST SHORTFALL: For any Distribution Date, the
excess, if any, of (i) the sum of (a) aggregate Uncollected Interest, and (b)
any shortfall in interest collections in the calendar month immediately
preceding such Distribution Date resulting from a Relief Act Interest Shortfall
over (ii) the aggregate Compensating Interest paid by the Servicers and the
Master Servicer for such Distribution Date, which excess shall be allocated to
each Class of Certificates pro rata according to the amount of interest accrued
thereon in reduction thereof.
UNDERWRITER: Deutsche Bank Securities, Inc.
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 pursuant to Section 3.9.
U.S. PERSON: A citizen or resident of the United States, a corporation
or partnership (including an entity treated as a corporation or partnership for
federal income tax purposes) created or organized in, or under the laws of, the
United States or any state thereof or the District of Columbia (except, in the
case of a partnership, to the extent provided in regulations) or an estate whose
income is subject to United States federal income tax regardless of its source,
or a trust if a court within the United States is able to exercise primary
supervision over the administration of the trust and one or more such U.S.
Persons have the authority to control all substantial decisions of the trust. To
the extent prescribed in regulations by the Secretary of the Treasury, which
have not yet been issued, a trust which was in existence on August 20, 1996
(other than a trust treated as owned by the grantor under subpart E of part 1 of
subchapter J of chapter 1 of the Code), and which was treated as a U.S. Person
on August 20, 1996 may elect to continue to be treated as a U.S. Person
notwithstanding the previous sentence.
XXXXX FARGO: Xxxxx Fargo Bank Minnesota, National Association, or any
successor thereto.
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ARTICLE II
CONVEYANCE OF TRUST FUND;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.1 Conveyance of Trust Fund. The Depositor, concurrently with
the execution and delivery hereof, does hereby transfer, assign, set over and
otherwise convey to the Trustee, on behalf of the Trust, without recourse, for
the benefit of the Certificateholders, all the right, title and interest of the
Depositor, including any security interest therein for the benefit of the
Depositor, in and to the Loans identified on the Loan Schedule, the rights of
the Depositor under the Mortgage Loan Purchase Agreement and the Assignment
Agreements (including, without limitation the right to enforce the obligations
of the other parties thereto thereunder), and all other assets included or to be
included in REMIC I. Such assignment includes all interest and principal
received by the Depositor or the applicable Servicer on or with respect to the
Loans (other than payments of principal and interest due on such Loans on or
before the Cut-off Date). The Depositor herewith delivers to the Trustee
executed copies of the Mortgage Loan Purchase Agreement, the Servicing
Agreements and Assignment Agreements.
In connection with such transfer and assignment, the Depositor
does hereby deliver to, and deposit with the Custodian pursuant to the Custodial
Agreement the documents with respect to each Loan as described under Section 2
of the Custodial Agreement (the " Loan Documents"). In connection with such
delivery and as further described in the Custodial Agreement, the Custodian will
be required to review such Loan Documents and deliver to the Trustee, the
Depositor, the Master Servicer and the Seller certifications (in the forms
attached to the Custodial Agreement) with respect to such review with exceptions
noted thereon. In addition, the Depositor under the Custodial Agreement will
have to cure certain defects with respect to the Loan Documents for the related
Loans after the delivery thereof by the Depositor to the Custodian as more
particularly set forth therein.
Section 2.2 Acceptance by Trustee. The Trustee acknowledges receipt,
subject to the provisions of Section 2.1 hereof and Section 2 of the Custodial
Agreement, of the Loan Documents and all other assets included in the definition
of "REMIC I" under clauses (i), (iii), (iv) and (v) (to the extent of amounts
deposited into the Distribution Account) and declares that it holds (or the
Custodian on its behalf holds) and will hold such documents and the other
documents delivered to it constituting a Loan Document, and that it holds (or
the Custodian on its behalf holds) or will hold all such assets and such other
assets included in the definition of "REMIC I" in trust for the exclusive use
and benefit of all present and future Certificateholders.
Section 2.3 Repurchase or Substitution of Loans.
(a) Upon discovery or receipt of notice of any materially
defective document in, or that a document is missing from, a Mortgage File or of
a breach by the Seller of any representation, warranty or covenant under the
Mortgage Loan Purchase Agreement in respect of any
35
Loan that materially and adversely affects the value of such Loan or the
interest therein of the Certificateholders, the Trustee shall promptly notify
the Seller of such defect, missing document or breach and request that the
Seller deliver such missing document, cure such defect or breach within 60 days
from the date the Seller was notified of such missing document, defect or
breach, and if the Seller does not deliver such missing document or cure such
defect or breach in all material respects during such period, the Trustee shall
enforce the obligations of the Seller under the Mortgage Loan Purchase Agreement
to repurchase such Loan from REMIC I at the Purchase Price within 90 days after
the date on which the Seller was notified of such missing document, defect or
breach, if and to the extent that the Seller is obligated to do so under the
Mortgage Loan Purchase Agreement. The Purchase Price for the repurchased Loan
shall be deposited in the Master Servicer Collection Account and the Trustee,
upon receipt of written certification from the Master Servicer of such deposit
and receipt by the Custodian of a properly completed request for release for
such Loan in the form of Exhibit 3 to the Custodial Agreement, shall release or
cause the Custodian to release to the Seller the related Mortgage File and the
Trustee shall execute and deliver such instruments of transfer or assignment, in
each case without recourse, representation or warranty, as the Seller shall
furnish to it and as shall be necessary to vest in the Seller any Loan released
pursuant hereto, and the Trustee shall not have any further responsibility with
regard to such Mortgage File. In lieu of repurchasing any such Loan as provided
above, if so provided in the Mortgage Loan Purchase Agreement, the Seller may
cause such Loan to be removed from REMIC I (in which case it shall become a
Deleted Loan) and substitute one or more Substitute Loans in the manner and
subject to the limitations set forth in Section 2.3(b). It is understood and
agreed that the obligation of the Seller to cure or to repurchase (or to
substitute for) any 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 respecting such omission, defect or
breach available to the Trustee and the Certificateholders.
(b) Any substitution of Substitute Loans for Deleted Loans
made pursuant to Section 2.3(a) must be effected prior to the date which is two
years after the Startup Day for REMIC I.
As to any Deleted Loan for which the Seller, substitutes a
Substitute Loan or Loans, such substitution shall be effected by the Seller
delivering to the Trustee or the Custodian on behalf of the Trustee, for such
Substitute Loan or Loans, the Mortgage Note, the Mortgage, the Assignment to the
Trustee, and such other documents and agreements, with all necessary
endorsements thereon, as are required by Section 2 of the Custodial Agreement,
as applicable, together with an Officers' Certificate providing that each such
Substitute Loan satisfies the definition thereof and specifying the Substitution
Shortfall Amount (as described below), if any, in connection with such
substitution. The Custodian on behalf of the Trustee shall acknowledge receipt
of such Substitute Loan or Loans and, within ten Business Days thereafter,
review such documents and deliver to the Depositor, the Trustee and the Master
Servicer, with respect to such Substitute Loan or Loans, an initial
certification pursuant to the Custodial Agreement, with any applicable
exceptions noted thereon. Within one year of the date of substitution, the
Custodian on behalf of the Trustee shall deliver to the Depositor, the Trustee
and the Master Servicer a final certification pursuant to the Custodial
36
Agreement with respect to such Substitute Loan or Loans, with any applicable
exceptions noted thereon. Monthly Payments due with respect to Substitute Loans
in the month of substitution are not part of REMIC I and will be retained by the
Seller. For the month of substitution, distributions to Certificateholders will
reflect the Monthly Payment due on such Deleted Loan on or before the Due Date
in the month of substitution, and the Seller shall thereafter be entitled to
retain all amounts subsequently received in respect of such Deleted Loan. The
Depositor shall give or cause to be given written notice to the
Certificateholders that such substitution has taken place, shall amend the Loan
Schedule to reflect the removal of such Deleted Loan from the terms of this
Agreement and the substitution of the Substitute Loan or Loans and shall deliver
a copy of such amended Loan Schedule to the Trustee and the Master Servicer.
Upon such substitution, such Substitute Loan or Loans shall constitute part of
the Trust Fund and shall be subject in all respects to the terms of this
Agreement and the Mortgage Loan Purchase Agreement including all applicable
representations and warranties thereof included herein or in the Mortgage Loan
Purchase Agreement.
For any month in which the Seller substitutes one or more
Substitute Loans for one or more Deleted Loans, the Master Servicer will
determine the amount (the "Substitution Shortfall Amount"), if any, by which the
aggregate Purchase Price of all such Deleted Loans exceeds the aggregate of, as
to each such Substitute Loan, the Scheduled Principal Balance thereof as of the
date of substitution, together with one month's interest on such Scheduled
Principal Balance at the applicable Net Mortgage Rate, plus all outstanding
Advances and Servicing Advances (including Nonrecoverable Advances) related
thereto. On the date of such substitution, the Seller will deliver or cause to
be delivered to the Master Servicer for deposit in the Master Servicer
Collection Account an amount equal to the Substitution Shortfall Amount, if any,
and the Trustee or the Custodian on behalf of the Trustee, upon receipt of the
related Substitute Loan or Loans and certification by the Master Servicer of
such deposit and receipt by the Custodian of a properly completed request for
release for such Loan in the form of Exhibit 3 to the Custodial Agreement, shall
release to the Seller the related Mortgage File or Files and the Trustee shall
execute and deliver such instruments of transfer or assignment, in each case
without recourse, representation or warranty, as the Seller shall deliver to it
and as shall be necessary to vest therein any Deleted Loan released pursuant
hereto.
In addition, the Seller shall obtain at its own expense and
deliver to the Trustee an Opinion of Counsel to the effect that such
substitution will not cause (a) any federal tax to be imposed on any Trust
REMIC, including without limitation, any federal tax imposed on "prohibited
transactions" under Section 860F(a)(1) of the Code or on "contributions after
the startup date" under Section 860G(d)(1) of the Code, or (b) any Trust REMIC
to fail to qualify as a REMIC at any time that any Certificate is outstanding.
(c) Upon discovery by the Depositor, the Seller, the Master
Servicer or the Trustee that any Loan does not constitute a "qualified mortgage"
within the meaning of Section 860G(a)(3) of the Code, the party discovering such
fact shall within two Business Days give written notice thereof to the other
parties. In connection therewith, the Seller shall repurchase or, substitute one
or more Substitute Loans for the affected Loan within 90 days of the earlier of
discovery or receipt of such notice with respect to such affected Loan. Such
repurchase or substitution shall be
37
made by (i) the Seller if the affected Loan's status as a non-qualified mortgage
is or results from a breach of any representation, warranty or covenant made by
the Seller under the Mortgage Loan Purchase Agreement or (ii) the Depositor, if
the affected Loan's status as a non-qualified mortgage is a breach of no
representation or warranty. Any such repurchase or substitution shall be made in
the same manner as set forth in Section 2.3(a). The Trustee shall reconvey to
the Seller the Loan to be released pursuant hereto in the same manner, and on
the same terms and conditions, as it would a Loan repurchased for breach of a
representation or warranty.
(d) Within 90 days of the earlier of discovery by the Master
Servicer or receipt of notice by the Master Servicer of the breach of any
representation, warranty or covenant of the Master Servicer set forth in Section
2.5 which materially and adversely affects the interests of the
Certificateholders in any Loan, the Master Servicer shall cure such breach in
all material respects.
Section 2.4 Authentication and Delivery of Certificates; Designation of
Certificates as REMIC Regular and Residual Interests.
(a) The Trustee acknowledges the transfer to the extent provided herein
and assignment to it of the Trust Fund and, concurrently with such transfer and
assignment, has caused to be authenticated and delivered to or upon the order of
the Depositor, in exchange for the Trust Fund, Certificates evidencing the
entire ownership of the Trust Fund.
(b) This Agreement shall be construed so as to carry out the intention
of the parties that each of REMIC I and REMIC II be treated as a REMIC at all
times prior to the date on which the Trust Fund is terminated. The "regular
interests" (within the meaning of Section 860G(a)(1) of the Code) in REMIC II
shall consist of the Class A Certificates and the Subordinate Certificates. The
"residual interest" (within the meaning of Section 860G(a)(2) of the Code) in
REMIC II shall consist of Component R-2 of the Class R Certificate. The "regular
interests" (within the meaning of Section 860G(a)(1) of the Code) of REMIC I
shall consist of Class A-1 Regular Interest, the Class A-2 Regular Interest, the
Class A-3 Regular Interest, the Class A-5 Regular Interest, the Class A-6
Regular Interest, the Class A-7 Regular Interest, the Class A-8 Regular
Interest, the Class A-9 Regular Interest, the Class A-10 Regular Interest, the
Class A-11 Regular Interest, the Class A-12 Regular Interest, the Class A-13
Regular Interest, the Class A-14 Regular Interest, the Class A-15 Regular
Interest, the Class A-16 Regular Interest, the Class A-17 Regular Interest, the
Class A-18 Regular Interest, the Class A-P Regular Interest, the Class A-X
Regular Interest, the Class M Regular Interest, the Class B-1 Regular Interest,
the Class B-2 Regular Interest, the Class B-3 Regular Interest, the Class B-4
Regular Interest and the Class B-5 Regular Interest. The "residual interest"
(within the meaning of Section 860(G)(a)(2) of the Code) of REMIC I shall
consist of Component R-1 of the Class R Certificate.
(c) All payments with respect to each of the Class A-1, Class A-2,
Class A-3, Class A-5, Class A-6, Class A-7, Class A-8, Class A-9, Class A-10,
Class A-11, Class A-12, Class A-13, Class A-14, Class A-15,Class A-16,Class
A-17, Class A-18, Class A-P, Class A-X, Class M, Class B-1, Class B-2, Class
B-3, Class B-4 and Class B-5 Certificates shall each be considered to have been
38
made solely from the Regular Interest of REMIC I having the same designation.
All principal payments with respect to each such Class of Certificates (other
than the Class A-4 and Class A-X Certificates) shall be considered to have been
made solely from the principal payments of the corresponding Regular Interests
of REMIC I, and the Class Principal Balance of each such Class of Certificate
(other than the Class A-4 and Class A-X Certificates) shall be equal at all
times to the principal balance of each such corresponding Regular Interest of
REMIC I. All interest payments with respect to the Class A-4 Certificates shall
be considered to have been made solely from the interest payments of the Class
A-3 Regular Interest of REMIC I. All interest payments with respect to the Class
A-X Certificates shall be considered to have been made solely from the interest
payments of the Class A-X Regular Interest of REMIC I, and the notional
principal amount of the Class A-X Regular Interest shall be equal at all times
to the Class A-X Notional Amount.
The interest rate of each REMIC I Regular Interest X-0, X-0, X-0, X-0,
X-0, X-00, X-00, X-00, X-00, X-00, X-00, X-00, X-00, X-00, X, X-0, X-0, X-0, B-4
and B-5 shall be 6.000%. The interest rate of REMIC I Regular Interest A-1 and
A-2 shall be 4.50%. The interest rate of REMIC I Regular Interest A-3 shall be
8.500%. The Class A-X Regular Interest shall be entitled to interest on the
Premium Loans to the extent the Net Mortgage Rate of such Premium Loans exceeds
6.000% per annum. The Class A-P Regular Interest Classes shall not bear
interest, but will receive principal only in respect of the Loans.
(d) The Class A-4 Certificates shall be considered for federal income
tax purposes to have a notional principal amount which is equal at all times to
the principal balance of the Class A-3 Regular Interest, and shall bear interest
at a rate of 8.10% minus LIBOR (subject to a maximum rate of 8.10% per annum and
a minimum rate of 0.00% per annum).
Section 2.5 Representations and Warranties of the Master Servicer. The
Master Servicer hereby represents, warrants and covenants to the Trustee, for
the benefit of each of the Trustee, the Certificateholders and the Depositor
that as of the Closing Date or as of such date specifically provided herein:
(i) The Master Servicer is a national banking association duly
formed, validly existing and in good standing under the laws of the
United States of America and is duly authorized and qualified to
transact any and all business contemplated by this Agreement to be
conducted by the Master Servicer;
(ii) The Master Servicer has the full power and authority to
conduct its business as presently conducted by it and to execute,
deliver and perform, and to enter into and consummate, all transactions
contemplated by this Agreement. The Master Servicer 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 Depositor and the Trustee,
constitutes a legal, valid and binding obligation of the Master
Servicer, enforceable against it in accordance with its terms except as
the enforceability thereof may be limited by bankruptcy, insolvency,
reorganization or similar
39
laws affecting the enforcement of creditors' rights generally and by
general principles of equity;
(iii) The execution and delivery of this Agreement by the
Master Servicer, the consummation by the Master Servicer of any other
of the transactions herein contemplated, and the fulfillment of or
compliance with the terms hereof are in the ordinary course of business
of the Master Servicer and will not (A) result in a breach of any term
or provision of charter and by-laws of the Master Servicer or (B)
conflict with, result in a breach, violation or acceleration of, or
result in a default under, the terms of any other material agreement or
instrument to which the Master Servicer is a party or by which it may
be bound, or any statute, order or regulation applicable to the Master
Servicer of any court, regulatory body, administrative agency or
governmental body having jurisdiction over the Master Servicer; and the
Master Servicer is not a party to, bound by, or in breach or violation
of any indenture or other agreement or instrument, or subject to or in
violation of any statute, order or regulation of any court, regulatory
body, administrative agency or governmental body having jurisdiction
over it, which materially and adversely affects or, to the Master
Servicer's knowledge, would in the future materially and adversely
affect, (x) the ability of the Master Servicer to perform its
obligations under this Agreement or (y) the business, operations,
financial condition, properties or assets of the Master Servicer taken
as a whole;
(iv) The Master Servicer does not believe, nor does it have
any reason or cause to believe, that it cannot perform each and every
covenant made by it and contained in this Agreement;
(v) No litigation is pending against the Master Servicer that
would materially and adversely affect the execution, delivery or
enforceability of this Agreement or the ability of the Master Servicer
to perform any of its other obligations hereunder in accordance with
the terms hereof,
(vi) There are no actions or proceedings against, or
investigations known to it of, the Master Servicer before any court,
administrative or other tribunal (A) that might prohibit its entering
into this Agreement, (B) seeking to prevent the consummation of the
transactions contemplated by this Agreement or (C) that might prohibit
or materially and adversely affect the performance by the Master
Servicer of its obligations under, or validity or enforceability of,
this Agreement; and
(vii) No consent, approval, authorization or order of any
court or governmental agency or body is required for the execution,
delivery and performance by the Master Servicer of, or compliance by
the Master Servicer with, this Agreement or the consummation by it of
the transactions contemplated by this Agreement, except for such
consents, approvals, authorizations or orders, if any, that have been
obtained prior to the Closing Date.
40
It is understood and agreed that the representations,
warranties and covenants set forth in this Section 2.5 shall inure to the
benefit of the Trustee, the Depositor and the Certificateholders.
Section 2.6 Establishment of the Trust.
The Depositor does hereby establish, pursuant to the further provisions
of this Agreement and the laws of the State of New York, an express trust to be
known, for convenience, as "Deutsche Mortgage Securities, Inc., Mortgage Loan
Trust, Series 2002-1" and does hereby appoint Bank One, National Association, as
Trustee in accordance with the provisions of this Agreement.
41
ARTICLE III
ADMINISTRATION AND SERVICING OF THE LOANS; ACCOUNTS
Section 3.1 Master Servicer. The Master Servicer shall
supervise, monitor and oversee the obligation of the Servicers to service and
administer their respective Loans in accordance with the terms of the applicable
Servicing Agreement and shall have full power and authority to do any and all
things which it may deem necessary or desirable in connection with such master
servicing and administration. In performing its obligations hereunder, the
Master Servicer shall act in a manner consistent with Accepted Master Servicing
Practices. Furthermore, the Master Servicer shall oversee and consult with each
Servicer as necessary from time-to-time to carry out the Master Servicer's
obligations hereunder, shall receive, review and evaluate all reports,
information and other data provided to the Master Servicer by 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 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 4.4 and any
other information and statements required to be provided by the Master Servicer
hereunder. The Master Servicer shall reconcile the results of its Loan
monitoring with the actual remittances of the Servicers to the Master Servicer
Collection Account pursuant to the applicable Servicing Agreements.
The Trustee shall furnish the Servicers and the Master Servicer with
any limited powers of attorney and other documents in form as provided to it
necessary or appropriate to enable the Servicers and the Master Servicer to
service or master service and administer the related Loans and REO Property. The
Trustee shall have no responsibility for any action of the Master Servicer or
any Servicer pursuant to any such limited power of attorney and shall be
indemnified by the Master Servicer or such Servicer for any cost, liability or
expense arising from the misuse thereof by the Master Servicer or such Servicer.
The Trustee, the Custodian and the Securities Administrator shall
provide access to the records and documentation in possession of the Trustee,
the Custodian or the Securities Administrator regarding the related Loans and
REO Property and the servicing thereof to the Certificateholders, the FDIC, and
the supervisory agents and examiners of the FDIC, such access being afforded
only upon reasonable prior written request and during normal business hours at
the office of the Trustee, the Custodian or the Securities Administrator;
provided, however, that, unless otherwise required by law, none of the Trustee,
the Custodian or the Securities Administrator shall be required to provide
access to such records and documentation if the provision thereof would violate
the legal right to privacy of any Mortgagor. The Trustee, the Custodian and the
Securities Administrator shall allow representatives of the above entities to
photocopy any of the records and documentation and shall provide equipment for
that purpose at a charge that covers the Trustee's, the Custodian's or the
Securities Administrator's actual costs.
42
The Trustee shall execute and deliver to the related Servicer or the
Master Servicer upon request any court pleadings, requests for trustee's sale or
other documents necessary or desirable and, in each case, provided to the
Trustee by such Servicer or Master Servicer to (i) the foreclosure or trustee's
sale with respect to a Mortgaged Property; (ii) any legal action brought to
obtain judgment against any Mortgagor on the Mortgage Note or any other Loan
Document; (iii) obtain a deficiency judgment against the Mortgagor; or (iv)
enforce any other rights or remedies provided by the Mortgage Note or any other
Loan Document or otherwise available at law or equity.
Section 3.2 REMIC-Related Covenants. For as long as each REMIC
shall exist, the Trustee and the Securities Administrator shall treat such REMIC
as a REMIC, and the Trustee and the Securities Administrator shall comply with
any directions of the Seller, the related Servicer or the Master Servicer to
assure such continuing treatment. In particular, the Trustee shall not (a) sell
or permit the sale of all or any portion of the Loans or of any investment of
deposits in an Account unless such sale is as a result of a repurchase of the
Loans pursuant to this Agreement or the Trustee has received an Opinion of
Counsel stating that such sale will not result in an Adverse REMIC Event as
defined in Section 10.1(f) hereof prepared at the expense of the Trust Fund; and
(b) other than with respect to a substitution pursuant to the Mortgage Loan
Purchase Agreements or the Assignment Agreements or Section 2.3 of this
Agreement, as applicable, accept any contribution to any REMIC after the Startup
Day without receipt of an Opinion of Counsel stating that such contribution will
not result in an Adverse REMIC Event as defined in Section 10.1(f) hereof.
Section 3.3 Monitoring of Servicers. (a) The Master Servicer
shall be responsible for monitoring 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 any
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 Seller and
the 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 Trustee and the
Certificateholders, 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 Loans or to cause the
Trustee to enter in to a new Servicing Agreement with a successor Servicer
selected by the Master Servicer; 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
43
business judgment, would require were it the owner of the related 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 of such servicing data as may be
required by the successor servicer to correct any errors or insufficiencies in
the servicing data or otherwise to enable the successor servicer to service the
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 Master Servicer
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.
Section 3.4 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 3.5 Power to Act; Procedures. The Master Servicer
shall master service the Loans and shall have full power and authority, subject
to the REMIC Provisions and the provisions of Article X hereof, to do any and
all things that it may deem necessary or desirable in connection with the master
servicing and administration of the Loans, including but not limited to the
power and authority (i) to execute and deliver, on behalf of the
Certificateholders and the Trustee, customary consents or waivers and other
instruments and documents, (ii) to consent to transfers of any Mortgaged
Property and assumptions of the Mortgage Notes and related Mortgages, (iii) to
collect any Insurance Proceeds and Liquidation Proceeds, and (iv) to effectuate
foreclosure or other conversion of the ownership of the Mortgaged Property
securing any Loan, in each case, in accordance with the provisions of this
Agreement and the related Servicing Agreement, as applicable; provided, however,
that the Master Servicer shall not (and, consistent with its responsibilities
under Section 3.3, shall not permit any Servicer to) knowingly or intentionally
take
44
any action, or fail to take (or fail to cause to be taken) any action reasonably
within its control and the scope of duties more specifically set forth herein,
that, under the REMIC Provisions, if taken or not taken, as the case may be,
would cause REMIC I or REMIC II to fail to qualify as a REMIC or result in the
imposition of a tax upon the Trust Fund (including but not limited to the tax on
prohibited transactions as defined in Section 860F(a)(2) of the Code and the tax
on contributions to a REMIC set forth in Section 860G(d) of the Code) unless the
Master Servicer has received an Opinion of Counsel (but not at the expense of
the Master Servicer) to the effect that the contemplated action will not would
cause REMIC I or REMIC II to fail to qualify as a REMIC or result in the
imposition of a tax upon REMIC I or REMIC II, as the case may be. The Trustee
shall furnish the Master Servicer, upon written request from a Servicing
Officer, with any 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 Loans or the Mortgaged Property, in accordance with the
applicable Servicing Agreement and this Agreement, and the Trustee shall execute
and deliver such other documents, as the Master Servicer or applicable Servicer
may request, to enable the Master Servicer to master service and administer the
Loans and carry out its duties hereunder, in each case in accordance with
Accepted Master Servicing Practices (and the Trustee shall have no liability for
the misuse of any such powers of attorney by the Master Servicer or any Servicer
and shall be indemnified by the Master Servicer or such Servicer for any costs,
liabilities or expenses incurred by the Trustee in connection with such misuse).
If the Master Servicer or the Trustee has been advised that it is likely that
the laws of the state in which action is to be taken prohibit such action if
taken in the name of the Trustee or that the Trustee would be adversely affected
under the "doing business" or tax laws of such state if such action is taken in
its name, the Master Servicer shall join with the Trustee in the appointment of
a co-trustee pursuant to Section 8.10 hereof. In the performance of its duties
hereunder, the Master Servicer shall be an independent contractor and shall not,
except in those instances where it is taking action authorized pursuant to this
Agreement to be taken by it in the name of the Trustee, be deemed to be the
agent of the Trustee.
Section 3.6 Due-on-Sale Clauses; Assumption Agreements. To the
extent provided in the applicable Servicing Agreement, to the extent 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 Loan is assumed, the original
Mortgagor may be released from liability in accordance with the applicable
Servicing Agreement.
Section 3.7 Release of Mortgage Files.
(a) Upon becoming aware of the payment in full of any Loan, or the
receipt by any Servicer of a notification that payment in full has been escrowed
in a manner customary for such purposes for payment to Certificateholders on the
next Distribution Date, the applicable Servicer will, if required under the
applicable Servicing Agreement, promptly furnish to the Custodian, on behalf of
45
the Trustee, two copies of a request for release substantially in the form
attached to the Custodial Agreement, and 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 Protected Account maintained by
the applicable Servicer pursuant to its Servicing Agreement have been or will be
so deposited) and shall request that the Custodian, on behalf of the Trustee,
deliver to the applicable Servicer the related Mortgage File. Upon receipt of
such certification and request, the Custodian, on behalf of the Trustee, shall
promptly release the related Mortgage File to the applicable Servicer and the
Trustee and Custodian 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 Trustee, as the mortgagee under the Mortgage that secured
the 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 Master Servicer Collection Account.
(b) From time to time and as appropriate for the servicing or
foreclosure of any Loan and in accordance with the applicable Servicing
Agreement, the Trustee shall execute such documents as shall be prepared and
furnished to the Trustee by a Servicer or the Master Servicer (in form
reasonably acceptable to the Trustee) and as are necessary to the prosecution of
any such proceedings. The Custodian, on behalf of the Trustee, shall, upon the
request of a Servicer or the Master Servicer, and delivery to the Custodian, on
behalf of the Trustee, of two copies of a request for release signed by a
Servicing Officer substantially in the form attached to the Custodial Agreement
(or in a mutually agreeable electronic format which will, in lieu of a signature
on its face, originate from 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 Custodian on behalf of the Trustee,
when the need therefor by the Servicer or the Master Servicer no longer exists
unless the 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 Custodian, on behalf of the Trustee, to
the Servicer or the Master Servicer.
Section 3.8 Documents, Records and Funds in Possession of Master
Servicer To Be Held for Trustee.
(a) The Master Servicer shall transmit and each Servicer (to the extent
required by the related Servicing Agreement) shall transmit to the 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 Trustee or Custodian. Any funds received by the Master
Servicer or by a Servicer in respect of any Loan or which otherwise are
collected by the Master Servicer or
46
by a Servicer as Liquidation Proceeds or Insurance Proceeds in respect of any
Loan shall be held for the benefit of the Trustee and the Certificateholders
subject to the Master Servicer's right to retain or withdraw from the Master
Servicer Collection Account the Master Servicing Compensation and other amounts
provided in this Agreement, and to the right of each Servicer to retain its
Servicing Fee and 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 Loans to the Trustee, its agents and
accountants at any time upon reasonable request and during normal business
hours, and to Certificateholders that are savings and loan associations, banks
or insurance companies, the OTS, the FDIC and the supervisory agents and
examiners of such Office and Corporation or examiners of any other federal or
state banking or insurance regulatory authority if so required by applicable
regulations of the OTS or other regulatory authority, such access to be afforded
without charge but only upon reasonable request in writing and during normal
business hours at the offices of the Master Servicer designated by it. In
fulfilling such a request the Master Servicer shall not be responsible for
determining the sufficiency of such information.
(b) All Mortgage Files and funds collected or held by, or under the
control of, the Master Servicer, in respect of any Loans, whether from the
collection of principal and interest payments or from Liquidation Proceeds or
Insurance Proceeds, shall be held by the Master Servicer for and on behalf of
the Trustee and the Certificateholders and shall be and remain the sole and
exclusive property of the Trustee; provided, however, that the Master Servicer
and 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 3.9 Standard Hazard Insurance and Flood
Insurance Policies.
(a) For each 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.
(b) Pursuant to Sections 3.22 and 3.23, any amounts collected by 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 Master Servicer
Collection Account, subject to withdrawal pursuant to Sections 3.24 and 3.26.
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 Loan where the terms of the Loan so permit;
47
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
Certificateholders and shall be recoverable by the Master Servicer or such
Servicer pursuant to Sections 3.24 and 3.26.
Section 3.10 Presentment of Claims and Collection of Proceeds.
The Master Servicer shall (to the extent provided in the applicable Servicing
Agreement) cause the related Servicer to, prepare and present on behalf of the
Trustee and the Certificateholders all claims under any insurance policies and
take such actions (including the negotiation, settlement, compromise or
enforcement of the insured's claim) as shall be necessary to realize recovery
under such policies. Any proceeds disbursed to the Master Servicer (or disbursed
to a Servicer and remitted to the Master Servicer) in respect of such policies,
bonds or contracts shall be promptly deposited in the Master Servicer Collection
Account upon receipt, except that any amounts realized that are to be applied to
the repair or restoration of the related Mortgaged Property as a condition
precedent to the presentation of claims on the related Loan to the insurer under
any applicable insurance policy need not be so deposited (or remitted).
Section 3.11 Maintenance of the Primary Mortgage
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 primary mortgage
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 Loan requires the Mortgagor to maintain such insurance), primary mortgage
insurance applicable to each Loan 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 primary
mortgage insurance policy that is in effect at the date of the initial issuance
of the Mortgage Note and is required to be kept in force hereunder except in
accordance with the provisions of this Agreement 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
Trustee and the Certificateholders, claims to the insurer under any primary
mortgage insurance policies and, in this regard, to take such reasonable action
as shall be necessary to permit recovery under any primary mortgage insurance
policies respecting defaulted Loans. Pursuant to Sections 3.22 and 3.23, any
amounts collected by the Master Servicer or any Servicer under any primary
mortgage insurance policies shall be deposited in the Master Servicer Collection
Account, subject to withdrawal pursuant to Sections 3.24 and 3.26.
Section 3.12 Trustee to Retain Possession of Certain
Insurance Policies and Documents.
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The Trustee or the applicable Custodian, shall retain
possession and custody of the originals (to the extent available) of any primary
mortgage insurance policies, or certificate of insurance if applicable, and any
certificates of renewal as to the foregoing as may be issued from time to time
as contemplated by this Agreement. Until all amounts distributable in respect of
the Certificates has been distributed in full and the Master Servicer otherwise
has fulfilled its obligations under this Agreement, the Trustee or the Custodian
shall also retain possession and custody of each Mortgage File in accordance
with and subject to the terms and conditions of this Agreement and the Custodial
Agreement. The Master Servicer shall promptly deliver or cause to be delivered
to the Trustee or the Custodian, upon the execution or receipt thereof the
originals of any primary mortgage insurance policies, any certificates of
renewal, and such other documents or instruments that constitute Loan Documents
that come into the possession of the Master Servicer from time to time.
Section 3.13 Realization Upon Defaulted 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 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 3.14 Compensation for the Master Servicer.
(a) In addition to the Master Servicer's right to receive its Master
Servicing Fee, all income and gain realized from any investment of funds in the
Master Servicer Collection Account and the Distribution Account shall be for the
benefit of the Master Servicer as compensation. Servicing compensation in the
form of assumption fees, if any, late payment charges, as collected, if any, or
otherwise shall be retained by the applicable Servicer and shall not be
deposited in the Protected 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.
(b) The amount of the aggregate compensation payable as set forth in
Section 3.14(a) (the "Master Servicing Compensation") to the Master Servicer in
respect of any Distribution Date shall be reduced in accordance with Section
3.20.
Section 3.15 REO Property.
(a) In the event the Trust Fund acquires ownership of any REO Property
in respect of any related Loan, the deed or certificate of sale shall be issued
to the Trustee, or to its nominee, on behalf of the related Certificateholders.
The Master Servicer shall, to the extent provided in the applicable Servicing
Agreement, cause the applicable Servicer 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. Further, the
Master Servicer shall, to the extent provided in the related Servicing
Agreement, cause the applicable Servicer to sell any REO Property prior to three
years
49
after the end of the calendar year of its acquisition by REMIC I unless (i) the
Trustee shall have been supplied with an Opinion of Counsel to the effect that
the holding by the Trust Fund of such REO Property subsequent to such three-year
period will not result in the imposition of taxes on "prohibited transactions"
of any REMIC hereunder as defined in section 860F of the Code or cause any REMIC
hereunder to fail to qualify as a REMIC at any time that any Certificates are
outstanding, in which case the Trust Fund may continue to hold such Mortgaged
Property (subject to any conditions contained in such Opinion of Counsel) or
(ii) the applicable Servicer shall have applied for, prior to the expiration of
such three-year period, an extension of such three-year period in the manner
contemplated by Section 856(e)(3) of the Code, in which case the three-year
period shall be extended by the applicable extension period. The Master Servicer
shall cause the applicable Servicer (to the extent provided in the related
Servicing Agreement) to protect and conserve, such REO Property in the manner
and to the extent required by the applicable Servicing Agreement, in accordance
with the REMIC Provisions and in a manner that does not result in a tax on "net
income from foreclosure property" or cause such REO Property to fail to qualify
as "foreclosure property" within the meaning of Section 860G(a)(8) of the Code.
(b) The Master Servicer shall, to the extent required by the related
Servicing Agreement, cause the applicable Servicer to deposit all funds
collected and received in connection with the operation of any REO Property in
the Protected Account.
(c) The Master Servicer and the applicable Servicer, upon the final
disposition of any REO Property, shall be entitled to reimbursement for any
related unreimbursed Advances and other unreimbursed advances as well as any
unpaid Servicing Fees 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 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) To the extent provided in the related Servicing Agreement, 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 Protected Account on or prior to the Determination
Date in the month following receipt thereof and be remitted by wire transfer in
immediately available funds to the Master Servicer for deposit into the related
Master Servicer Collection Account on the next succeeding Remittance Date.
Section 3.16 Annual Officer's Certificate as to Compliance.
(a) The Master Servicer shall deliver to the Trustee and the Rating
Agencies on or before May 31 of each year, commencing on May 31, 2004, an
Officer's Certificate signed by a Servicing Officer, 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
50
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
Certificateholder upon request, by the Master Servicer or by the 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 Trustee with
such statement or (ii) the Trustee shall be unaware of the Master Servicer's
failure to provide such statement).
Section 3.17 Annual Independent Accountant's Servicing Report.
If the Master Servicer has, during the course of any fiscal year, directly
serviced any of the 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 Trustee, the Rating Agencies and the Seller on or
before May 31 of each year, commencing on May 31, 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 pooling and servicing and trust
agreements 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 Certificateholder
upon request by the Master Servicer, or by the Trustee at the expense of the
Master Servicer if the Master Servicer shall fail to provide such copies (unless
(i) the Master Servicer shall have failed to provide the Trustee with such
statement or (ii) the Trustee shall be unaware of the Master Servicer's failure
to provide such statement). If such report discloses exceptions that are
material, the Master Servicer shall advise the Trustee whether such exceptions
have been or are susceptible of cure, and will take prompt action to do so.
Section 3.18 Reports Filed with Securities and Exchange
Commission.
(a) Within 15 days after each Distribution Date, the Master Servicer
shall, in accordance with industry standards, file with the Commission via the
Electronic Data Gathering and Retrieval System
51
("XXXXX"), a Form 8-K with a copy of the statement to be furnished by the
Securities Administrator to the Certificateholders for such Distribution Date as
an exhibit thereto. Prior to January 30, 2003, the Master Servicer shall, in
accordance with industry standards, file a Form 15 Suspension Notice with
respect to the Trust Fund, if applicable. Prior to March 30, 2003 and annually
thereafter (if required), the Master Servicer shall file a Form 10-K, in
substance conforming to industry standards, with respect to the Trust Fund. Such
Form 10-K shall include, to the extent available, as exhibits (i) each
applicable Servicer's annual statement of compliance described under the related
Servicing Agreement, (ii) each applicable Servicer's accountants report
described under the related Servicing Agreement, (iii) the Master Servicer's
accountant's report described in Section 3.17, if applicable, in each case to
the extent timely delivered, if applicable, to the Master Servicer, and (iv) a
written certification signed by an officer of the Master Servicer that complies
with the Xxxxxxxx-Xxxxx Act of 2002 as in effect on the date of this Agreement
and the August 27, 2002, Statement by the Staff of the Division of Corporation
Finance of the Commission Regarding Compliance by Asset-Backed Issuers with
Exchange Act Rules 13a-14 and 15d-14 as in effect as of the date of this
Agreement. If items (i) and (ii) in the preceding sentence are not timely
delivered, the Master Servicer shall file an amended Form 10-K including such
documents as exhibits reasonably promptly after they are delivered to the Master
Servicer. The Depositor hereby grants to the Master Servicer a limited power of
attorney to execute and file each Form 8-K and Form 10-K 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 Trust Fund. The Depositor and
the Trustee each agree 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 Loans as the Master
Servicer reasonably deems appropriate to prepare and file all necessary reports
with the Commission. The Master Servicer will cooperate with the Depositor in
connection with any additional filings with respect to the Trust Fund as the
Depositor deems necessary under the Exchange Act. Copies of all reports filed by
the Master Servicer under the Exchange Act shall be sent to the Depositor.
(b) The Master Servicer shall indemnify and hold harmless the
Depositor, the Trustee and their respective officers, directors and Affiliates
from and against any losses, damages, penalties, fines, forfeitures, reasonable
and necessary legal fees and related costs, judgments and other costs and
expenses arising out of or based upon a breach of the Master Servicer's
obligations under this Section 3.18 or the Master Servicer's negligence, bad
faith or willful misconduct in connection therewith. Fees and expenses incurred
by the Master Servicer in connection with this Section 3.18 shall not be
reimbursable from the Trust Fund.
Section 3.19 UCC. The Depositor agrees to file continuation
statements for any Uniform Commercial Code financing statements which the Seller
has informed the Depositor were filed on the Closing Date in connection with the
Trust. The Depositor shall file any financing statements or amendments thereto
required by any change in the Uniform Commercial Code.
Section 3.20 Obligation of the Master Servicer in respect of
Compensating Interest. The Master Servicer shall deposit in the Master Servicer
Collection Account not later than each
52
Distribution Account Deposit Date an amount equal to the lesser of (i) the
aggregate amounts required to be paid by the Servicers under the Servicing
Agreements with respect to Compensating Interest on the related Loans for the
related Distribution Date, and not so paid by the related Servicers and (ii) the
Master Servicing Compensation for such Distribution Date without reimbursement
therefor.
Section 3.21 Reserved.
Section 3.22 Protected Accounts.
(a) The Master Servicer shall enforce the obligation of each Servicer
to establish and maintain a Protected Account in accordance with the applicable
Servicing Agreement, with records to be kept with respect thereto on a Loan by
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 principal and interest on any Loan and with respect to any REO
Property received by a Servicer, including Principal Prepayments, Insurance
Proceeds, Liquidation Proceeds, and advances made from the Servicer's own funds
(less servicing compensation as permitted by the applicable Servicing Agreement
in the case of any Servicer) and all other amounts to be deposited in the
Protected Account. Each Servicer is hereby authorized to make withdrawals from
and deposits to the related Protected Account for purposes required or permitted
by the related Servicing Agreement. To the extent provided in the related
Servicing Agreement, the Protected Account shall be held in a Depository
Institution and segregated on the books of such institution in the name of the
Trustee for the benefit of Certificateholders.
(b) To the extent provided in the related Servicing Agreement, amounts
on deposit in a Protected Account may be invested in Eligible Investments in the
name of the Trustee for the benefit of Certificateholders and, except as
provided in the preceding paragraph, not commingled with any other funds, such
Eligible Investments to mature, or to be subject to redemption or withdrawal, no
later than the date on which such funds are required to be withdrawn for deposit
in the Master Servicer Collection Account, and shall be held until required for
such deposit. The income earned from Eligible Investments made pursuant to this
Section 3.22 shall be paid to the related Servicer under the applicable
Servicing Agreement, and the risk of loss of moneys required to be distributed
to the Certificateholders resulting from such investments shall be borne by and
be the risk of the related Servicer. The related Servicer (to the extent
provided in the Servicing Agreement) shall deposit the amount of any such loss
in the Protected Account within two Business Days of receipt of notification of
such loss but not later than the second Business Day prior to the Distribution
Date on which the moneys so invested are required to be distributed to the
Certificateholders.
(c) To the extent provided in the related Servicing Agreement and
subject to this Article III, on or before each Servicer Remittance Date, the
related Servicer shall withdraw or shall cause to be withdrawn from the
Protected Accounts and shall immediately deposit or cause to be deposited in the
Master Servicer Collection Account amounts representing the following
collections and
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payments (other than with respect to principal of or interest on the Loans due
on or before the Cut- Off Date):
(i) Monthly Payments on the 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, net of the
amount thereof comprising the Servicing Fees;
(ii) Principal Prepayments, Liquidation Proceeds received
by the Servicers with respect to such Loans in the related Prepayment
Period and Compensating Interest; and
(iii) Any amount to be used as an Advance.
(d) Withdrawals may be made from an Account only to make remittances as
provided in Section 3.22(c), 3.23 and 3.24 or as otherwise provided in the
Servicing Agreements; 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 a temporary basis; or to clear and terminate the
account at the termination of this Agreement in accordance with Section 9.1. As
provided in Sections 3.22(c) and 3.23(b) or as otherwise provided in the
Servicing Agreements certain amounts otherwise due to the Servicers may be
retained by them and need not be deposited in the Master Servicer Collection
Account.
Section 3.23 Master Servicer Collection Account.
(a) The Master Servicer shall establish and maintain in the name of the
Trustee, for the benefit of the Certificateholders, the Master Servicer
Collection Account as a segregated trust account or accounts. The Master
Servicer will deposit in the Master Servicer Collection Account as identified by
the Master Servicer and as received by the Master Servicer, the following
amounts:
(i) Any amounts withdrawn from a Protected Account;
(ii) Any Advance and any amounts in respect of Prepayment
Interest Shortfalls;
(iii) Any Insurance Proceeds or Liquidation Proceeds received
by or on behalf of the Master Servicer;
(iv) The Purchase Price with respect to any Loans purchased by
the Seller pursuant to Section 2.3 and all proceeds of any Loans or
property acquired with respect thereto purchased by the Master Servicer
pursuant to Section 9.1;
(v) Any amounts required to be deposited by the Master
Servicer or any Servicer with respect to losses on investments of
deposits in an Account; and
54
(vi) Any other amounts received by or on behalf of the Master
Servicer and required to be deposited in the Master Servicer Collection
Account pursuant to this Agreement.
(b) All amounts deposited to the Master Servicer Collection Account
shall be held by the Master Servicer in the name of the Trustee in trust for the
benefit of the Certificateholders in accordance with the terms and provisions of
this Agreement. The requirements for crediting the Master Servicer Collection
Account or the Distribution Account shall be exclusive, it being understood and
agreed that, without limiting the generality of the foregoing, payments in the
nature of late payment charges or assumption, tax service, statement account or
payoff, substitution, satisfaction, release and other like fees and charges,
need not be credited by the Master Servicer or the related Servicer to the
Distribution Account or the Master Servicer Collection Account, as applicable.
In the event that the Master Servicer shall deposit or cause to be deposited to
the Distribution Account any amount not required to be credited thereto, the
Trustee, upon receipt of a written request therefor signed by a Servicing
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 Master Servicer Collection
Account may be invested, in the name of the Trustee, or its nominee, for the
benefit of the Certificateholders, in Eligible Investments as directed by Master
Servicer. All Eligible Investments shall mature or be subject to redemption or
withdrawal on or before, and shall be held until, the Business Day immediately
preceding the Distribution Date. Any and all investment earnings from the Master
Servicer Collection Account shall be paid to the Master Servicer. The risk of
loss of moneys required to be distributed to the Certificateholders resulting
from such 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 Master
Servicer Collection Account within two Business Days of receipt of notification
of such loss but not later than the Business Day prior to the Distribution Date
on which the moneys so invested are required to be remitted to the Trustee.
Section 3.24 Permitted Withdrawals and Transfers from the
Master Servicer Collection Account.
(a) The Master Servicer will, from time to time, make or cause to be
made such withdrawals or transfers from the Master Servicer Collection Account
as the Master Servicer has designated for such transfer or withdrawal pursuant
to the Servicing Agreements. The Master Servicer may clear and terminate the
Master Servicer Collection Account pursuant to Section 9.1 and remove amounts
from time to time deposited in error.
(b) On an ongoing basis, the Master Servicer shall withdraw from the
Master Servicer Collection Account to pay itself as provided in Section 3.14 and
to pay any expenses recoverable by the Trustee, the Securities Administrator or
the Master Servicer pursuant to Sections 3.3, 6.3, 8.5 and 10.1.
55
(c) In addition, on the Distribution Account Deposit Date, the Master
Servicer shall deposit in the Distribution Account (or remit to the Trustee for
deposit therein) any Advances required to be made by the Master Servicer with
respect to the Loans.
(d) No later than 3:00 p.m. New York time on each Distribution Account
Deposit Date, the Master Servicer will transfer to the Trustee in immediately
available funds for deposit in the Distribution Account, that portion of the
Available Distribution Amount for the related Distribution Date then on deposit
in the Master Servicer Collection Account.
Section 3.25 Distribution Account.
(a) The Trustee shall establish and maintain in the name of the
Trustee, for the benefit of the Certificateholders, the Distribution Account as
a segregated trust account or accounts.
(b) All amounts deposited to the Distribution Account shall be held by
the Trustee in the name of the Trustee in trust for the benefit of the
Certificateholders in accordance with the terms and provisions of this
Agreement.
(c) The Distribution Account shall constitute a trust account of the
Trust Fund segregated on the books of the Trustee and held by the Trustee in
trust in its Corporate Trust Office, and the Distribution Account and the funds
deposited therein shall not be subject to, and shall be protected from, all
claims, liens, and encumbrances of any creditors or depositors of the Trustee
(whether made directly, or indirectly through a liquidator or receiver of the
Trustee). The amount at any time credited to the Distribution Account shall be
invested in the name of the Master Servicer, in such Eligible Investments
selected by the Master Servicer or deposited in demand deposits with such
depository institutions as selected by the Master Servicer, provided that time
deposits of such depository institutions would be an Eligible Investment. All
Eligible Investments shall mature or be subject to redemption or withdrawal on
or before, and shall be held until, the next succeeding Distribution Date if the
obligor for such Eligible Investment is the Trustee or, if such obligor is any
other Person, the Business Day preceding such Distribution Date. All investment
earnings on amounts on deposit in the Distribution Account from time to time
shall be for the account of the Master Servicer. The Master Servicer shall be
permitted to receive distribution of any and all investment earnings from the
Distribution Account on each Distribution Date. If there is any loss on an
Eligible Investment or demand deposit, the Master Servicer shall deposit such
amount in the Distribution Account. With respect to the Distribution Account and
the funds deposited therein, the Trustee shall take such action as may be
necessary to ensure that the Certificateholders shall be entitled to the
priorities afforded to such a trust account (in addition to a claim against the
estate of the Trustee) as provided by 12 U.S.C. ss. 92a(e), and applicable
regulations pursuant thereto, if applicable, or any applicable comparable state
statute applicable to state chartered banking corporations.
Section 3.26 Permitted Withdrawals and Transfers from the
Distribution Account.
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(a) The Trustee will, from time to time on demand of the Master
Servicer or the Securities Administrator make or cause to be made such
withdrawals or transfers from the Distribution Account as the Master Servicer or
the Securities Administrator has designated for such transfer or withdrawal
pursuant to the Servicing Agreements for the following purposes, not in any
order of priority, (limited in the case of amounts due the Master Servicer to
those not withdrawn from the Master Servicer Collection Account in accordance
with the terms of this Agreement):
(i) to reimburse the Master Servicer or any Servicer for any
Advance of its 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 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 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
Loan for amounts expended by the Master Servicer or such Servicer in
good faith in connection with the restoration of the related Mortgaged
Property which was damaged by an Uninsured Cause or in connection with
the liquidation of such Loan;
(iii) to reimburse the Master Servicer or any Servicer from
Insurance Proceeds relating to a particular Loan for insured expenses
incurred with respect to such Loan and to reimburse the Master Servicer
or such Servicer from Liquidation Proceeds from a particular Loan for
Liquidation Expenses incurred with respect to such Loan; provided that
the Master Servicer or such Servicer shall not be entitled to
reimbursement for Liquidation Expenses with respect to a Loan to the
extent that (i) any amounts with respect to such Loan were paid as
Excess Liquidation Proceeds pursuant to clause (x) of this Subsection
(a) to the Master Servicer or such Servicer; and (ii) such Liquidation
Expenses were not included in the computation of such Excess
Liquidation Proceeds;
(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 Loan, the amount which it or
such Servicer would have been entitled to receive under subclause (x)
of this Subsection (a) as servicing compensation on account of each
defaulted scheduled payment on such 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 Loan, the amount which it or such Servicer would
have been entitled to receive under subclause (x) of this Subsection
(a) as servicing compensation;
(vi) [reserved];
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(vii) to reimburse the Master Servicer or any Servicer for any
Nonrecoverable Advance, after a Realized Loss has been allocated with
respect to the related Loan if the Advance or Servicing Advance has not
been reimbursed pursuant to clauses (i) and (vi);
(viii) [reserved];
(ix) to pay the Servicing Fee to the Servicers and the Master
Servicing Fee to the Master Servicer for such Distribution Date and the
amount of any income or gain realized from investments of funds on
deposit in the Distribution Account pursuant to Section 3.14 hereof and
to reimburse the Master Servicer for expenses, costs and liabilities
incurred by and reimbursable to it pursuant to Sections 3.3, 6.3, 8.5
and 10.1;
(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 reimburse the Trustee, the Custodian and the
Securities Administrator for expenses, costs and liabilities, if any,
incurred by or reimbursable to such parties pursuant to this Agreement;
(xii) to remove amounts deposited in error; and
(xiii) to clear and terminate the Distribution Account
pursuant to Section 9.1.
(b) The Master Servicer shall keep and maintain separate
accounting, on a Loan by Loan basis, for the purpose of accounting for any
reimbursement from the Distribution Account pursuant to subclauses (i) through
(vi), inclusive, 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 Distribution Account under Section
3.23(b).
(c) On each Distribution Date, the Trustee shall distribute
the Available Distribution Amount to the Holders of the Certificates in
accordance with Section 4.1 and the applicable instructions of the Securities
Administrator.
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ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS; ADVANCES;
STATEMENTS AND REPORTS
Section 4.1 Distributions to Certificateholders.
(a) On each Distribution Date, the Trustee, to the extent on deposit
therein and based solely upon the Securities Administrator's Remittance Report
for such Distribution Date, shall withdraw from the Distribution Account the
Available Distribution Amount for such Distribution Date and distribute to each
Certificateholder, by wire transfer in immediately available funds for the
account of the Certificateholder or by any other means of payment acceptable to
each Certificateholder of record on the immediately preceding Record Date (other
than as provided in Section 9.1 respecting the final distribution) as specified
by each such Certificateholder and at the address of such Holder appearing in
the Certificate Register, from the amount so withdrawn and to the extent of the
Available Distribution Amount, such Certificateholder's Percentage Interest of
the following amounts and in following order of priority:
(I) For any Distribution Date prior to the Credit Support Depletion
Date, the Available Distribution Amount shall be distributed to the
Certificates in the following amounts and priority:
(1) first, to the Class A-P Certificates, the Discount
Fractional Principal Amount;
(2) second, to the Senior Certificates (other than the
Principal Only Certificates), concurrently, the sum of the Interest
Distribution Amounts for such Classes of Certificates remaining unpaid
from previous Distribution Dates, pro rata according to their
respective shares of such unpaid amounts provided, however, that the
aggregate amount that would otherwise be payable to the Accrual
Certificates pursuant to this clause (I)(2) will be paid instead as
principal as described in clause (I)(3);
(3) third, (a) to the Senior Certificates, concurrently, the
sum of the Interest Distribution Amounts for such Classes (other than
the Principal Only Certificates) of Certificates for the current
Distribution Date, pro rata according to their respective Interest
Distribution Amounts and (b) the Class A-16 Accrual Amount as principal
to the Accretion Directed Certificates in the following order of
priority: to the Class A-14 Certificates and then to the Class A-15
Certificates until their respective Class Principal Balances have been
reduced to zero;
(4) fourth, to the Senior Certificates (other than the Class
A-P Certificates and the Interest Only Certificates), the Senior
Principal Amount in the following order of priority:
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(a) first, to the Class R Certificates, until its
Class Principal Balance has been reduced to zero;
(b) second, to the Class A-17 Certificates and Class
A-18 Certificates, pro rata, according to their respective
outstanding Class Principal Balances up to the Lockout
Principal Amount, until their respective Class Principal
Balances have been reduced to zero;
(c) third, (1) 50.00% of the Senior Principal Amount
remaining after the distributions, if any, described in
clauses (I)(4)(a) and (b) above to the Class A-1, Class A-2,
Class A-3, Class A-5, Class A-6, Class A-7, Class A-8 and
Class A-9 Certificates in the following order of priority:
(i) first, (x) 62.50% of the Senior
Principal Amount described in clause
(I)(4)(c)(1) above to the Class A-1
Certificates and the Class A-2
Certificates, sequentially, in that
order, until their Class Principal
Balances are reduced to their
respective Planned Principal
Balances set forth in Exhibit M
attached hereto and (y) 37.50% of
the Senior Principal Amount
described in clause (I)(4)(c)(1)
above to the Class A-3 Certificates
until its Class Principal Balance is
reduced to its Planned Principal
Balance set forth in Exhibit M
attached hereto;
(ii) second, to the Class A-5
Certificates, the amount necessary
to reduce the Class Principal
Balance of the Class A-5
Certificates to its Planned
Principal Balance set forth in
Exhibit M attached hereto;
(iii) third, to the Class A-6 Certificates
and the Class A-7 Certificates,
sequentially, in that order, until
their Class Principal Balances are
reduced to their respective Targeted
Principal Balances set forth in
Exhibit N attached hereto;
(iv) fourth, to the Class A-8
Certificates and Class A-9
Certificates, pro rata, according to
their respective outstanding Class
Principal Balances, until their
respective Class Principal Balances
have been reduced to zero;
(v) fifth, to the Class A-6 Certificates
unless the Class Principal Balance
of the Class A-6 Certificates has
been reduced to zero, in which case
to the Class A-7 Certificates, in
each case without regard to their
Targeted Principal Balances, until
their
60
respective Class Principal Balances
have been reduced to zero;
(vi) sixth, (x) 62.50% of the Senior
Principal Amount described in clause
(I)(4)(c)(1) above remaining after
the distributions, if any, described
in clauses (I)(4)(c)(1)(i)
through(c)(1)(iv) above first, to
the Class A-1 Certificates until the
Class Principal Balance of the Class
A-1 Certificates has been reduced to
zero and then to the Class A-2
Certificates until its Class
Principal Balance has been reduced
to zero, in each case without regard
to their respective Planned
Principal Balances, and (y) 37.50%
of the Senior Principal Amount
described in clause (I)(4)(c)(1)
above remaining after the
distributions, if any, described in
clauses (I)(4)(c)(1)(i)
through(c)(1)(v) above to the Class
A-3 Certificates without regard to
its Planned Principal Balance, until
its Class Principal Balance has been
reduced to zero;
(vii) seventh, to the Class A-5
Certificates without regard to its
Planned Principal Balance, until its
Class Principal Balance has been
reduced to zero;
and (2) 50.00% of the Senior Principal Amount
remaining after the distributions, if any, described in
clauses (I)(4)(a) and (b) above to the Class A-10, Class A-11,
Class A-12, Class A-13, Class A-14, Class A-15, and Class A-16
Certificates in the following order of priority:
(i) first, to the Class A-10, Class
A-11, Class A-12 and Class X- 00
Certificates, pro rata, according to
their respective outstanding Class
Principal Balances, until their
respective Class Principal Balances
have been reduced to zero;
(ii) second, to the Class A-14, Class
A-15 and Class A-16 Certificates,
sequentially, in that order, in each
case until its respective Class
Principal Balance has been reduced
to zero;
(d) fourth, to the Class A-17 Certificates and Class
A-18 Certificates, pro rata, according to their respective
outstanding Class Principal Balances, until their Class
Principal Balance has been reduced to zero;
(5) fifth, to the Class A-P Certificates, up to the
Subordinate Principal Amount (determined without regard to the proviso
of such definition) for such Distribution Date, the Discount Fractional
Principal Shortfall amount payable to the Class A-P Certificates on
61
previous Distribution Dates pursuant to this clause (I)(5) and
remaining unpaid from such previous Distribution Dates; and
(6) sixth, to the Class A-P Certificates, up to the
Subordinate Principal Amount (determined without regard to the proviso
of such definition) for such Distribution Date (less any amounts
distributed to the Class A-P Certificates pursuant to paragraph
(I)(5)), the Discount Fractional Principal Shortfall for such
Distribution Date; provided that any amounts distributed in respect of
the Discount Fractional Principal Shortfall pursuant to clause (I)(5)
above or this clause (I)(6) shall not cause a further reduction of the
Class A-P Class Principal Balance;
(7) seventh, to each of the Class M, X-0, X-0, X-0, X-0 and
B-5 Certificates, sequentially, in that order of seniority, the
following:
(a) first, its respective amount of previously
unpaid and then current Interest Distribution Amount;
(b) second, its pro rata share of the Subordinate
Principal Amount for such Distribution Date, until its Class Principal
Balance has been reduced to zero. The Subordinate Principal Amount for
a Distribution Date shall be allocated among the Classes of Subordinate
Certificates, pro rata, based on the Class Principal Balances of such
Classes. Notwithstanding the foregoing, on any Distribution Date prior
to distributions on such date, if the Subordination Level for any Class
of Subordinate Certificates is less than such percentage as of the
Closing Date, the pro rata portion of the Subordinate Principal
Prepayment Amount otherwise allocable to the Class or Classes junior to
such Class will be distributed to the most senior Class of the
Subordinate Certificates for which the Subordination Level is less than
such percentage as of the Closing Date, and to the Classes of
Subordinate Certificates senior thereto, pro rata according to the
Class Principal Balances of such Classes;
(8) eighth, to the Senior Certificates (other than the
Interest Only Certificates and the Class A-P Certificates) in the order
of priority in which principal is paid to such Classes above, the
amount of unreimbursed Realized Losses previously allocated to such
Class of Certificates, if any, and then, to the Subordinate
Certificates, in the order of priority in which principal is paid to
such Classes above, the amount of unreimbursed Realized Losses
previously allocated to such Class of Certificates, if any, provided,
that any amounts distributed in respect of losses pursuant to this
paragraph (I)(8) shall not cause a further reduction in the Class
Principal Balance of any Class of Certificates; and
(9) ninth, to the Class R Certificate, the Residual
Distribution Amount;
62
(II) for any Distribution Date on or after the Credit Support Depletion
Date, the Available Distribution Amount, shall be distributed to the
outstanding Senior Certificates in the following amounts and priority:
(1) first, pro rata, according to their outstanding
Certificate Principal Balances, to the Class A-P Certificates, the
Discount Fractional Principal Amount;
(2) second, to the Senior Certificates (including the
Accrual Certificates, but excluding the Principal Only Certificates),
previously unpaid and then current Interest Distribution Amounts, pro
rata, according to such amount payable to the extent of amounts
available;
(3) third, to the Senior Certificates (other than the
Interest Only Certificates and the Class A-P Certificates), the Senior
Principal Amount, pro rata, according to their respective Class
Principal Balances (other than the Interest Only Certificates and the
Class A-P Certificates);
(4) fourth, to the Senior Certificates (other than
the Interest Only Certificates), pro rata, according to their
respective Class Principal Balances, the amount of unreimbursed
Realized Losses previously allocated to such Class; and
(5) fifth, to the Class R Certificate, the Residual
Distribution Amount for such Distribution Date.
(b) All reductions in the Certificate Principal Balance of a
Certificate effected by distributions of principal or allocations of Realized
Losses with respect to Loans made on any Distribution Date shall be binding upon
all Holders of such Certificate and of any Certificate issued upon the
registration of transfer or exchange therefor or in lieu thereof, whether or not
such distribution is noted on such Certificate. The final distribution of
principal of each Certificate (and the final distribution with respect to the
Class R Certificate upon termination of the Trust Fund) shall be payable in the
manner provided above only upon presentation and surrender thereof on or after
the Distribution Date therefor at the office or agency of the Trustee specified
in the notice delivered pursuant to Section 4.1(c) or Section 9.1.
(c) Whenever, on the basis of Curtailments, Payoffs and Monthly
Payments on the Loans and Insurance Proceeds and Liquidation Proceeds received
and expected to be received during the applicable Prepayment Period, the Trustee
believes that the entire remaining unpaid Class Principal Balance of any Class
of Certificates will become distributable on the next Distribution Date, the
Trustee shall, no later than the Determination Date of the month of such
Distribution Date, mail or cause to be mailed to each Person in whose name a
Certificate to be so retired is registered at the close of business on the
Record Date, to the Underwriter and to each Rating Agency a notice to the effect
that:
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(i) it is expected that funds sufficient to make such final
distribution will be available in the Distribution Account on
such Distribution Date, and
(ii) if such funds are available, (A) such final distribution will
be payable on such Distribution Date, but only upon
presentation and surrender of such Certificate at the office
or agency of the Certificate Registrar maintained for such
purpose (the address of which shall be set forth in such
notice), and (B) no interest shall accrue on such Certificate
after such Distribution Date.
Section 4.2 Allocation of Realized Losses.
Prior to each Distribution Date, the Master Servicer, based solely on
the information provided by the related Servicer, shall determine the amount of
Realized Losses, if any, with respect to each Loan.
All Realized Losses, except for Excess Losses, shall be allocated as
follows: (i) for losses allocable to principal (a) first, to the Subordinate
Certificates in the following order: Class B-5, Class B-4, Class B-3 Class B-2,
Class B-1, Class M until each of their Class Principal Balances have been
reduced to zero and (b) second, to the Senior Certificates, by Pro Rata
Allocation, until the Certificate Principal Balances thereof have been reduced
to zero; PROVIDED, HOWEVER, that prior to the Credit Support Depletion Date if
the loss is recognized with respect to (a) a Discount Loan, the Discount
Fraction of such loss shall be allocated to the Class A-P Certificates and the
remainder of such loss will be allocated as described in clause (i); and (ii)
for losses allocable to interest (a) first, to the Subordinate Certificates in
the following order: Class B-5, Class B-4, Class B-3 Class B-2, Class B-1, Class
M, in reduction of accrued but unpaid interest thereon and then in reduction of
the Class Principal Balance of such Certificates in the same order and (b)
second, to the Senior Certificates thereof, by Pro Rata Allocation, until the
Certificate Principal Balances thereof have been reduced to zero.
Excess Losses shall be allocated among the Senior Certificates and the
Subordinate Certificates by Pro Rata Allocation.
On each Distribution Date, after giving effect to the principal
distributions and allocations and reimbursement of losses as provided in this
Agreement (without regard to this paragraph), if the Aggregate Certificate
Principal Balance of all outstanding Classes of Certificates exceeds the
aggregate principal balance of the Loans, after deduction of (i) all principal
payments due on or before the Cut-Off Date in respect of each such Loan whether
or not paid and (ii) all amounts of principal in respect of each such Loan that
have been received or advanced and included in the Available Distribution
Amount, and all losses in respect of such Loans that have been allocated to the
Certificates, on such Distribution Date or prior Distribution Dates, then such
excess will be deemed a principal loss and will be allocated (i) first, to the
Subordinate Certificates in reverse order of seniority until each of their Class
Principal Balances has been reduced to zero, and (ii) second, to the Senior
Certificates, other than the Interest Only Certificates, pro rata according to
their
64
Certificate Principal Balances or, in the case of the Accrual Certificates, the
Certificate Principal Balance of that Accrual Certificate on the Closing Date,
if lower, in reduction thereof (except all losses allocable to the Class A-17
Certificates will be allocated to the Class A-18 Certificates until the Class
Principal Balance thereof has been reduced to zero).
Section 4.3 Statements to Certificateholders.
(a) On each Distribution Date, the Securities Administrator shall
provide or make available, upon request to each Holder of the Regular Interest
Certificates, a statement (each, a "Remittance Report") as to the distributions
made on such Distribution Date setting forth:
(i) the amount of the distribution made on such Distribution
Date to the Holders of the Certificates of each Class allocable to
principal;
(ii) the amount of the distribution made on such Distribution
Date to the Holders of the Certificates of each Class allocable to
interest;
(iii) The aggregate Servicing Fee received by each Servicer
and Master Servicing Fee received by the Master Servicer and such other
customary information as the Securities Administrator deems necessary
or desirable, or which a Certificateholder reasonably requests, to
enable Certificateholders to prepare their tax returns;
(iv) The number and aggregate Principal Balance of the Loans
delinquent one, two and three months or more;
(v) The (A) number and aggregate Principal Balance of Loans
with respect to which foreclosure proceedings have been initiated, and
(B) the number and aggregate Principal Balance of Mortgaged Properties
acquired through foreclosure, deed in lieu of foreclosure or other
exercise of rights respecting the Trustee's security interest in the
Loans;
(vi) The aggregate Principal Balance of the Loans as of the
close of business on the last day of the related Prepayment Period;
(vii) The amount of Special Hazard Coverage available to the
Senior Certificates remaining as of the close of business on the
applicable Determination Date;
(viii) The amount of Bankruptcy Coverage available to the
Senior Certificates remaining as of the close of business on the
applicable Determination Date;
(ix) The amount of Fraud Coverage available to the Senior
Certificates remaining as of the close of business on the applicable
Determination Date;
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(x) The amount of Realized Losses allocable to the related
Certificates on the related Distribution Date and the cumulative amount
of Realized Losses incurred allocated to such Certificates since the
Cut-Off Date;
(xi) The amount of interest accrued but not paid on the each
Class of Certificates entitled to interest since (a) the prior
Distribution Date and (b) the Closing Date;
(xii) The amount of funds advanced by each Servicer and the
Master Servicer for such Distribution Date;
(xiii) The total amount of Payoffs and Curtailments received
during the related Prepayment Period;
(xiv) with respect to any Mortgage Loan that became an REO
Property during the preceding calendar month, the loan number of such
Mortgage Loan, the unpaid principal balance and the Scheduled Principal
Balance of such Mortgage Loan;
(xv) to the extent provided by the Servicer, the book value of
any REO Property as of the close of business on the last Business Day
of the calendar month preceding the Distribution Date;
(xvi) the aggregate amount of extraordinary Trust Fund
expenses withdrawn from the Master Servicer Collection Account or the
Distribution Account for such Distribution Date;
(xvii) the aggregate Certificate Principal Balance of each
Class of Certificates, after giving effect to the distributions, and
allocations of Realized Losses, made on such Distribution Date,
separately identifying any reduction thereof due to allocations of
Realized Losses;
(xviii) the aggregate amount of any Prepayment Interest
Shortfall for such Distribution Date, to the extent not covered by
payments by the Master Servicer pursuant to Section 3.20; and
(xix) the aggregate amount of Relief Act Interest Shortfalls
for such Distribution Date.
The Securities Administrator will make such statement (and, at its
option, any additional files containing the same information in an alternative
format) available each month to the Certificateholders, the Trustee and the
Rating Agencies via the Securities Administrator's internet website. The
Securities Administrator's internet website shall initially be located at
http:\\xxx.xxxxxxx.xxx and assistance in using the website can be obtained by
calling the Securities Administrator's customer service desk at 0-000-000-0000.
Parties that are unable to use the above
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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
Securities Administrator shall have the right to change the way such statements
are distributed in order to make such distribution more convenient and/or more
accessible to the above parties and the Securities Administrator shall provide
timely and adequate notification to all above parties regarding any such
changes.
In the case of information furnished pursuant to subclauses (i) through
(iii) above, the amounts shall be expressed as a dollar amount per Single
Certificate of the relevant Class.
Within a reasonable period of time after the end of each calendar year,
the Trustee shall furnish to each Person who at any time during the calendar
year was a Holder of a Regular Interest Certificate a statement containing the
information set forth in subclauses (i) through (iii) above, aggregated for such
calendar year or applicable portion thereof during which such person was a
Certificateholder. Such obligation of the Trustee shall be deemed to have been
satisfied to the extent that substantially comparable information shall be
provided by the Trustee pursuant to any requirements of the Code as from time to
time are in force.
Within a reasonable period of time after the end of each calendar year,
the Trustee shall furnish to each Person who at any time during the calendar
year was a Holder of a Residual Certificate a statement setting forth the
amount, if any, actually distributed with respect to the Residual Certificates,
as appropriate, aggregated for such calendar year or applicable portion thereof
during which such Person was a Certificateholder.
The Securities Administrator shall, upon request, furnish to each
Certificateholder, during the term of this Agreement, such periodic, special, or
other reports or information, whether or not provided for herein, as shall be
reasonable with respect to the Certificateholder, as applicable, or otherwise
with respect to the purposes of this Agreement, all such reports or information
to be provided at the expense of the Certificateholder, in accordance with such
reasonable and explicit instructions and directions as the Certificateholder may
provide.
On each Distribution Date the Securities Administrator shall provide
Bloomberg Financial Markets, L.P. ("Bloomberg") CUSIP level factors for each
class of Certificates as of such Distribution Date, using a format and media
mutually acceptable to the Securities Administrator and Bloomberg.
Section 4.4 Remittance Reports; Advances.
(a) Two Business Days prior to each Distribution Date, the Securities
Administrator shall deliver to the Trustee by telecopy (or by such other means
as the Securities Administrator and the Trustee may agree from time to time) a
Remittance Report with respect to the related Distribution Date. The Trustee
shall not be responsible to recompute, recalculate or verify any information
provided to it by the Securities Administrator.
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(b) If the Monthly Payment on a Loan that was due on a related Due Date
and is delinquent other than as a result of interest shortfalls due to
bankruptcy proceedings or 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 Master Servicer
Collection Account which will be used for an advance with respect to such Loan,
the Master Servicer will deposit in the Master Servicer Collection Account not
later than the Distribution Account Deposit Date immediately preceding the
related Distribution Date an amount equal to such deficiency, net of the
Servicing Fee and Master Servicing Fee for such Loan except to the extent the
Master Servicer determines any such advance to be nonrecoverable from
Liquidation Proceeds, Insurance Proceeds or future payments on the Loan for
which such Advance was made. Any amounts held for future distribution and so
used shall be appropriately reflected in the Master Servicer's records and
replaced by the Master Servicer by deposit in the Master Servicer Collection
Account on or before any future Distribution Account Deposit Date to the extent
that the Available Distribution Amount for the related Distribution Date
(determined without regard to Advances to be made on the Distribution Account
Deposit Date) shall be less than the total amount that would be distributed to
the Classes of Certificateholders pursuant to Section 4.1 on such Distribution
Date if such amounts held for future distributions had not been so used to make
Advances. 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 Distribution Account
Deposit Date, the Master Servicer shall present an Officer's Certificate to the
Trustee (i) stating that the Master Servicer elects not to make an Advance in a
stated amount and (ii) detailing the reason it deems the advance to be
nonrecoverable.
Section 4.5 Compliance with Withholding Requirements.
Notwithstanding any other provision of this Agreement, the Trustee
shall comply with all federal withholding requirements respecting payments to
Certificateholders of interest or original issue discount that the Trustee
reasonably believes are applicable under the Code. The consent of
Certificateholders shall not be required for such withholding. In the event the
Trustee does withhold any amount from interest or original issue discount
payments or advances thereof to any Certificateholder pursuant to federal
withholding requirements, the Trustee shall indicate the amount withheld to such
Certificateholders.
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ARTICLE V
THE CERTIFICATES
Section 5.1 The Certificates.
(a) The Certificates shall be substantially in the forms set forth in
Exhibits A and B attached hereto, and shall be executed by the Trustee,
authenticated by the Trustee and delivered to or upon the order of the
Depositor. The Certificates shall be issuable in Authorized Denominations
evidencing Percentage Interests. Certificates shall be executed by manual or
facsimile signature on behalf of the Trust Fund by authorized officers of the
Trustee. Certificates bearing the manual or facsimile signatures of individuals
who were at the time of execution the proper officers of the Trustee shall bind
the Trust Fund, notwithstanding that such individuals or any of them have ceased
to hold such offices prior to the authentication and delivery of such
Certificates or did not hold such offices at the date of such Certificates. No
Certificate shall be entitled to any benefit under this Agreement, or be valid
for any purpose, unless there appears on such Certificate a certificate of
authentication substantially in the form provided for herein executed by the
Trustee by manual signature, and such certificate upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder. All Certificates shall be dated the date
of their authentication.
(b) The following definitions apply for purposes of this Section 5.1:
"Disqualified Organization" means any Person which is not a Permitted
Transferee, but does not include any "Pass-Through Entity" which owns or holds a
Residual Certificate and of which a Disqualified Organization, directly or
indirectly, may be a stockholder, partner or beneficiary; "Pass-Through Entity"
means any regulated investment company, real estate investment trust, common
trust fund, partnership, trust or estate, and any organization to which Section
1381 of the Code applies; "Ownership Interest" means, with respect to any
Residual Certificate, any ownership or security interest in such Residual
Certificate, including any interest in a Residual Certificate as the Holder
thereof and any other interest therein whether direct or indirect, legal or
beneficial, as owner or as pledgee; "Transfer" means any direct or indirect
transfer or sale of, or directly or indirectly transferring or selling, any
Ownership Interest in a Residual Certificate; and "Transferee" means any Person
who is acquiring by Transfer any Ownership Interest in a Residual Certificate.
(c) Restrictions on Transfers of the Residual Certificate to
Disqualified Organizations are set forth in this Section 5.1(c).
(i) Each Person who has or who acquires any Ownership Interest
in a Residual Certificate shall be deemed by the acceptance or
acquisition of such Ownership Interest to have agreed to be bound by
the following provisions and to have irrevocably authorized the Trustee
under clause (iii)(A) below to deliver payments to a Person other than
such Person and to negotiate the terms of any mandatory sale under
clause (iii)(B) below and to execute all instruments of transfer and to
do all other things necessary in connection with any such
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sale. The rights of each Person acquiring any Ownership Interest in a
Residual Certificate are expressly subject to the following provisions:
(A) Each Person holding or acquiring any Ownership Interest in
a Residual Certificate shall be a Permitted Transferee and shall
promptly notify the Trustee or the Certificate Registrar if not the
same Person as the Trustee of any change or impending change in its
status as a Permitted Transferee.
(B) In connection with any proposed Transfer of any Ownership
Interest in a Residual Certificate to a U.S. Person, other than with
respect to the initial Transfer, the Trustee or the Certificate
Registrar if not the same Person as the Trustee shall require delivery
to it, and shall not register the Transfer of any Residual Certificate
until its receipt of (1) an affidavit and agreement (a "Transferee
Affidavit and Agreement") attached hereto as Exhibit J from the
proposed Transferee, in form and substance satisfactory to the
Depositor, representing and warranting, among other things, that it is
not a Non-U.S. Person, that such transferee is a Permitted Transferee,
that it is not acquiring its Ownership Interest in the Residual
Certificate that is the subject of the proposed Transfer as a nominee,
trustee or agent for any Person who is not a Permitted Transferee, that
for so long as it retains its Ownership Interest in a Residual
Certificate, it will endeavor to remain a Permitted Transferee, and
that it has reviewed the provisions of this Section 5.1(c) and agrees
to be bound by them, and (2) a certificate, attached hereto as Exhibit
I, from the Holder wishing to transfer the Residual Certificate, in
form and substance satisfactory to the Depositor, representing and
warranting, among other things, that no purpose of the proposed
Transfer is to allow such Holder to impede the assessment or collection
of tax.
(C) Notwithstanding the delivery of a Transferee Affidavit and
Agreement by a proposed Transferee under clause (B) above, if the
Trustee or the Certificate Registrar if not the same Person as the
Trustee has actual knowledge that the proposed Transferee is not a
Permitted Transferee, no Transfer of an Ownership Interest in a
Residual Certificate to such proposed Transferee shall be effected.
(D) Each Person holding or acquiring any Ownership Interest in
a Residual Certificate agrees by holding or acquiring such Ownership
Interest (i) to require a Transferee Affidavit and Agreement from any
other Person to whom such Person attempts to transfer its Ownership
Interest and to provide a certificate to the Trustee or the Certificate
Registrar if not the same Person as the Trustee in the form attached
hereto as Exhibit J; (ii) to obtain the express written consent of the
Depositor prior to any transfer of such Ownership Interest, which
consent may be withheld in the Depositor's sole discretion; and (iii)
to provide a certificate to the Trustee or the Certificate Registrar if
not the same Person as the Trustee in the form attached hereto as
Exhibit I.
(ii) The Trustee or the Certificate Registrar if not the same
Person as the Trustee shall register the Transfer of any Residual
Certificate only if it shall have received the
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Transferee Affidavit and Agreement, a certificate of the Holder
requesting such transfer in the form attached hereto as Exhibit J and
all of such other documents as shall have been reasonably required by
the Trustee or the Certificate Registrar if not the same Person as the
Trustee as a condition to such registration.
(iii) (A) If any Disqualified Organization shall become a
Holder of a Residual Certificate, then the last preceding Permitted
Transferee shall be restored, to the extent permitted by law, to all
rights and obligations as Holder thereof retroactive to the date of
registration of such Transfer of such Residual Certificate. If any
Non-U.S. Person shall become a Holder of a Residual Certificate, then
the last preceding Holder which is a U.S. Person shall be restored, to
the extent permitted by law, to all rights and obligations as Holder
thereof retroactive to the date of registration of the Transfer to such
Non-U.S. Person of such Residual Certificate. If a transfer of a
Residual Certificate is disregarded pursuant to the provisions of
Treasury Regulations Section 1.860E-1 or Section 1.860G- 3, then the
last preceding Permitted Transferee shall be restored, to the extent
permitted by law, to all rights and obligations as Holder thereof
retroactive to the date of registration of such Transfer of such
Residual Certificate. The Trustee, the Securities Administrator and the
Certificate Registrar shall be under no liability to any Person for any
registration of Transfer of a Residual Certificate that is in fact not
permitted by this Section 5.1(c) or for making any payments due on such
Certificate to the Holder thereof or for taking any other action with
respect to such Holder under the provisions of this Agreement.
(B) If any purported Transferee shall become a Holder of the
Residual Certificate in violation of the restrictions in this Section
5.1(c) and to the extent that the retroactive restoration of the rights
of the Holder of such Residual Certificate as described in clause
(iii)(A) above shall be invalid, illegal or unenforceable, then the
Depositor shall have the right, without notice to the Holder or any
prior Holder of such Residual Certificate, to sell such Residual
Certificate to a purchaser selected by the Depositor on such terms as
the Depositor may choose. Such purported Transferee shall promptly
endorse and deliver the Residual Certificate in accordance with the
instructions of the Depositor. Such purchaser may be the Depositor
itself or any affiliate of the Depositor. The proceeds of such sale,
net of the commissions (which may include commissions payable to the
Depositor or its affiliates), expenses and taxes due, if any, shall be
remitted by the Depositor to such purported Transferee. The terms and
conditions of any sale under this clause (iii)(B) shall be determined
in the sole discretion of the Depositor, and the Depositor shall not be
liable to any Person having an Ownership Interest in the Residual
Certificate as a result of its exercise of such discretion.
(iv) The Depositor, on behalf of the Trustee, shall make
available, upon written request from the Trustee or the Securities
Administrator all information necessary to compute any tax imposed (A)
as a result of the Transfer of an Ownership Interest in the Residual
Certificate to any Person who is not a Permitted Transferee, including
the information regarding "excess inclusions" of such Residual
Certificate required to be
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provided to the Internal Revenue Service and certain Persons as
described in Treasury Regulation Section 1.860D-1(b)(5), and (B) as a
result of any regulated investment company, real estate investment
trust, common trust fund, partnership, trust, estate or organizations
described in Section 1381 of the Code having as among its record
holders at any time any Person who is not a Permitted Transferee.
Reasonable compensation for providing such information may be required
by the Depositor from such Person.
(v) The provisions of this Section 5.1 set forth prior to this
Section 5.1(c)(v) may be modified, added to or eliminated, provided,
that there shall have been delivered to the Trustee and the Securities
Administrator the following:
(A) written notification from each Rating Agency to the effect
that the modification, addition to or elimination of such provisions
will not cause such Rating Agency to downgrade its then-current Ratings
of the Certificates; and
(B) an Opinion of Counsel, in form and substance satisfactory
to the Depositor (as evidenced by a certificate of the Depositor), to
the effect that such modification, addition to or absence of such
provisions will not cause the Trust Fund to cease to qualify as a REMIC
and will not create a risk that (1) the Trust Fund may be subject to an
entity-level tax caused by the Transfer of any Residual Certificate to
a Person which is not a Permitted Transferee or (2) a Certificateholder
or another Person will be subject to a REMIC-related tax caused by the
Transfer of a Residual Certificate to a Person which is not a Permitted
Transferee.
(vi) The following legend shall appear on all Residual
Certificates:
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE
MAY BE MADE ONLY IF THE PROPOSED TRANSFEREE PROVIDES A
TRANSFEREE AFFIDAVIT AND AGREEMENT TO THE DEPOSITOR, THE
TRUSTEE AND THE CERTIFICATE REGISTRAR THAT (1) SUCH TRANSFEREE
IS NOT EITHER (A) THE UNITED STATES, ANY STATE OR POLITICAL
SUBDIVISION THEREOF, ANY FOREIGN GOVERNMENT, ANY INTERNATIONAL
ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE
FOREGOING, (B) ANY ORGANIZATION (OTHER THAN A COOPERATIVE
DESCRIBED IN SECTION 521 OF THE CODE) WHICH IS EXEMPT FROM THE
TAX IMPOSED BY CHAPTER 1 OF THE CODE UNLESS SUCH ORGANIZATION
IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE CODE, (C)
ANY ORGANIZATION DESCRIBED IN SECTION 1381(a)(2)(C) OF THE
CODE (ANY SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A),
(B), OR (C) BEING HEREINAFTER
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REFERRED TO AS A "DISQUALIFIED ORGANIZATION"), OR (D) AN AGENT
OF A DISQUALIFIED ORGANIZATION AND (2) NO PURPOSE OF SUCH
TRANSFER IS TO ENABLE THE TRANSFEROR TO IMPEDE THE ASSESSMENT
OR COLLECTION OF TAX. SUCH AFFIDAVIT SHALL INCLUDE CERTAIN
REPRESENTATIONS AS TO THE FINANCIAL CONDITION OF THE PROPOSED
TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE
CERTIFICATE REGISTER OF ANY TRANSFER, SALE OR OTHER
DISPOSITION OF THIS CLASS R CERTIFICATE TO A DISQUALIFIED
ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH
REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT
WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A
CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER INCLUDING, BUT NOT
LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE.
EACH HOLDER OF THE CLASS R CERTIFICATE BY ACCEPTANCE OF THIS
CERTIFICATE SHALL BE DEEMED TO HAVE CONSENTED TO THE
PROVISIONS OF THIS PARAGRAPH.
(vii) The Holder of the Class R Certificate issued hereunder,
while not a Disqualified Organization, is the Tax Matters Person.
(d) (i) No purchase or transfer of a Senior Subordinate Certificate or
a Class R Certificate or any interest therein shall be made by or to any
"employee benefit plan" subject to ERISA or any "plan" described by Section
4975(e)(1) of the Code, or any entity deemed to hold plan assets of any of the
foregoing by reason of a plan's investment in such entity (each, a "Plan")
unless (A) in the case of the Senior Subordinate Certificates, the Person who
acquires a Senior Subordinate Certificate or any interest therein shall provide
to the Trustee and the Certificate Registrar a certificate in substantially the
form of Exhibit H attached hereto certifying that (1) it has acquired and is
holding such Certificates in reliance on Department of Labor Prohibited
Transaction Exemption 94-84 or FAN 97-03E, as amended, that it understands that
there are certain conditions to the availability of the exemptions, including
that such Certificates are rated at the time of purchase in one of the top four
rating categories by at least one Rating Agency, or (2) the purchaser is an
insurance company general account that is eligible for, and satisfies all of the
requirements of, Sections I and III of Prohibited Transaction Class Exemption
95-60 ("PTCE 95-60") and (B) in the case of a Class R Certificate, the Trustee
receives either (1) an Opinion of Counsel acceptable to and in form and
substance satisfactory to the Trustee, the Depositor and the Master Servicer to
the effect that the purchase and holding of such Class R Certificate is
permissible under applicable law, will not constitute or result in any
non-exempt prohibited transaction under Section 406 of ERISA, or Section 4975 of
the Code (or comparable provisions of any subsequent enactments), and will not
subject the Trustee, the Depositor, the Securities Administrator, any Servicer
or the Master Servicer to any
73
obligation or liability (including obligations or liabilities under ERISA or
Section 4975 of the Code) in addition to those undertaken in this Agreement,
which Opinion of Counsel shall not be an expense of the Trustee, the Depositor,
the Securities Administrator, any Servicer or the Master Servicer or (2) a
Transferee Affidavit and Agreement in substantially the form attached hereto as
Exhibit J. Each Person who acquires a Class R Certificate or a Senior
Subordinate Certificate shall be deemed to certify that it meets the foregoing
conditions, and that it will not transfer such Certificate in violation of the
foregoing.
(ii) No purchase or transfer of a Junior Subordinate
Certificate shall be made by or to a Plan unless such purchaser or
transferee is an "insurance company general account" (within the
meaning of PTCE 95-60) and is eligible for, and satisfies all of the
requirements for exemptive relief under Sections I and III of PTCE
95-60. Each Person who acquires a Junior Subordinate Certificate or any
interest therein shall be deemed to certify and shall be required to
provide to the Trustee and the Certificate Registar a certificate in
substantially the form attached hereto as Exhibit H signed by a
Responsible Officer of such Person, which certificate shall not be an
expense of the Trustee, the Securities Administrator, the Certificate
Registrar or the Depositor) that it meets the foregoing conditions, and
that it will not transfer such Certificate in violation of the
foregoing.
(e) Other than with respect to the initial transfer by the Depositor,
no transfer, sale, pledge or other disposition of a Junior Subordinate
Certificate shall be made unless such transfer, sale, pledge or other
disposition is made in accordance with this Section 5.1(e), Section 5.1(f) or
Section 5.1(g). Each Person who, at any time, acquires any ownership interest in
any Junior Subordinate Certificate shall be deemed by the acceptance or
acquisition of such ownership interest to have agreed to be bound by the
following provisions of this Section 5.1(e), Section 5.1(f) or Section 5.1(g),
as applicable. No transfer of a Junior Subordinate Certificate shall be deemed
to be made in accordance with this Section 5.1(e) unless such transfer is made
pursuant to an effective registration statement under the Securities Act or
unless the Trustee or the Certificate Registrar, if not the same Person as the
Trustee, is provided with the certificates and either (i) an Opinion of Counsel,
on which the Trustee and the Certificate Registrar may conclusively rely, which
opines that such transfer is exempt from the registration requirements under the
Securities Act or (ii) a statement of the Certificateholder desiring to effect
such transfer certifying to the Trustee and the Certificate Registrar in
writing, in substantially the form attached hereto as Exhibit F, the facts
surrounding the transfer, with such modifications to such Exhibit F as may be
appropriate to reflect the actual facts of the proposed transfer, and a
statement of the Certificateholder's proposed transferee certifying to the
Trustee and the Certificate Registrar in writing, in substantially the form
attached hereto as Exhibit G, the facts surrounding the transfer, with such
modifications to such Exhibit G as may be appropriate to reflect the actual
facts of the proposed transfer. If such certificate of the proposed transferee
does not contain substantially the substance of Exhibit G, the Trustee or the
Certificate Registrar, if not the same Person as the Trustee, shall require an
Opinion of Counsel satisfactory to it that such transfer may be made without
registration, which Opinion of Counsel shall not be obtained at the expense of
the Trustee, the Securities Administrator, the Certificate Registrar, the Trust
Fund or the Depositor. Such Opinion of Counsel shall allow for the forwarding,
and the
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Trustee shall forward, a copy thereof to each Rating Agency. Notwithstanding the
foregoing, any Class of Junior Subordinate Certificates may be transferred,
sold, pledged or otherwise disposed of in accordance with the requirements set
forth in Section 5.1(f) or Section 5.1(g).
(f) Transfers of the Junior Subordinate Certificates may be made in
accordance with this Section 5.1(f). To effectuate a Certificate transfer in
accordance with this Section 5.1(f), the proposed transferee of such Certificate
must provide the Trustee, the Certificate Registrar and the Depositor with an
investment letter substantially in the form of Exhibit L attached hereto, which
investment letter shall not be an expense of the Trustee, the Securities
Administrator, the Certificate Registrar or the Depositor, and which investment
letter states that, among other things, such transferee (i) is a "qualified
institutional buyer" as defined under Rule 144A, acting for its own account or
the accounts of other "qualified institutional buyers" as defined under Rule
144A, and (ii) is aware that the proposed transferor intends to rely on the
exemption from registration requirements under the Securities Act provided by
Rule 144A. Notwithstanding the foregoing, the proposed transferee of such
Certificate shall not be required to provide the Trustee, the Certificate
Registrar or the Depositor with Annex 1 or Annex 2 to the form of Exhibit L
attached hereto if the Depositor so consents in writing (with a copy to the
Trustee) prior to each such transfer. Such transfers shall be deemed to have
complied with the requirements of this Section 5.1(f). The Holder of a
Certificate desiring to effect such transfer hereby agrees to indemnify the
Trustee, the Securities Administrator the Depositor, and the Certificate
Registrar against any cost, expense or liability that may result if such
transfer is not made in accordance with this Agreement.
(g) Transfers of the Junior Subordinate Certificates may be made in
accordance with this Section 5.1(g). To effectuate a Certificate transfer in
accordance with this Section 5.1(g) without registration under the Securities
Act, the Certificateholder desiring to effect such transfer must provide the
Trustee, the Certificate Registrar and the Depositor with a certificate
substantially in the form of Exhibit E attached hereto, to the effect that such
transfer is being made in accordance with Rule 903 or Rule 904 of Regulation S.
Such transfers shall be deemed to have complied with the requirements of this
Section 5.1(g). The Holder of a Certificate desiring to effect such transfer
hereby agrees to indemnify the Trustee, the Securities Administrator the
Depositor, and the Certificate Registrar against any cost, expense or liability
that may result if such transfer is not made in accordance with this Agreement.
(h) None of the Trustee or the Certificate Registrar shall have any
liability to the Trust Fund and shall be indemnified by the Trust Fund for, any
cost, liability or expense incurred by them arising from a registration or
transfer of a Certificate in reliance upon a certification, Officer's
Certificate, affidavit, ruling or Opinion of Counsel described in this Section
5.1.
Section 5.2 Certificates Issuable in Classes; Distributions of
Principal and Interest; Authorized Denominations. The aggregate principal amount
of Certificates that may be authenticated and delivered under this Agreement is
limited to the aggregate Principal Balance of the Loans as of the Cut-Off Date,
as specified in the Preliminary Statement to this Agreement, except for
Certificates authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other
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Certificates pursuant to Section 5.3. Such aggregate principal amount shall be
allocated among one or more Classes having designations, types of interests,
initial per annum Remittance Rates, initial Class Principal Balances and last
scheduled Distribution Dates as specified in the Preliminary Statement to this
Agreement. The aggregate Percentage Interest of each Class of Certificates of
which the Class Principal Balance equals zero as of the Cut-Off Date that may be
authenticated and delivered under this Agreement is limited to 100%.
Certificates shall be issued in Authorized Denominations.
Section 5.3 Registration of Transfer and Exchange of Certificates. The
Trustee shall cause to be maintained at one of its offices or at its designated
Certificate Registrar, a Certificate Register in which there shall be recorded
the name and address of each Certificateholder. Subject to such reasonable rules
and regulations as the Trustee may prescribe, the Certificate Register shall be
amended from time to time by the Trustee or its agent to reflect notice of any
changes received by the Trustee or its agent pursuant to Section 11.5. The
Trustee may appoint an Eligible Institution to act as its agent in order to
delegate to such Eligible Institution its duties as Certificate Registrar under
this Agreement.
Upon surrender for registration of transfer of any Certificate to the
Trustee, the Trustee shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Certificates of Authorized Denominations of like Percentage Interest. At the
option of the Certificateholders, Certificates may be exchanged for other
Certificates in Authorized Denominations of like Percentage Interest, upon
surrender of the Certificates to be exchanged at any such office or agency.
Whenever any Certificates are so surrendered for exchange, the Trustee shall
execute, and the Trustee shall authenticate and deliver, the Certificates which
the Certificateholder making the exchange is entitled to receive. Every
Certificate presented or surrendered for transfer shall (if so required by the
Trustee) be duly endorsed by, or be accompanied by a written instrument of
transfer in form satisfactory to the Trustee and duly executed by, the Holder
thereof or such Holder's attorney duly authorized in writing.
A reasonable service charge may be made for any such exchange or
transfer of Certificates, and the Trustee may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any exchange or transfer of Certificates.
All Certificates surrendered for exchange or transfer shall be
canceled by the Trustee.
Section 5.4 Mutilated, Destroyed, Lost or Stolen Certificates. If (i)
any mutilated Certificate is surrendered to the Trustee or the Certificate
Registrar, or (ii) the Trustee or the Certificate Registrar receives evidence to
their satisfaction of the destruction, loss or theft of any Certificate, and
there is delivered to the Trustee and the Certificate Registrar such security or
indemnity as may be required by them to save each of them harmless, then, in the
absence of notice to the Trustee that such Certificate has been acquired by a
bona fide purchaser, the Trustee shall execute and the Trustee shall
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of like Percentage
Interest. Upon
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the issuance of any new Certificate under this Section 5.4, the Trustee may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses connected
therewith. Any replacement Certificate issued pursuant to this Section 5.4 shall
constitute complete and indefeasible evidence of ownership in the Trust Fund, as
if originally issued, whether or not the lost or stolen Certificate shall be
found at any time.
Section 5.5 Persons Deemed Owners. The Depositor, the Securities
Administrator, the Master Servicer, the Trustee and any agent of any of them may
treat the Person in whose name any Certificate is registered as the owner of
such Certificate for the purpose of receiving distributions pursuant to Section
4.1 and for all other purposes whatsoever, and neither the Depositor, the
Securities Administrator, the Master Servicer, the Trustee, the Certificate
Registrar, nor any agent of the Depositor, the Securities Administrator, the
Master Servicer or the Trustee shall be affected by notice to the contrary.
Section 5.6 Temporary Certificates. Upon the initial issuance of the
Certificates, the Trustee may execute, and the Trustee shall authenticate and
deliver, temporary Certificates which are printed, lithographed, typewritten or
otherwise produced, in any Authorized Denomination, of the tenor of the
definitive Certificates in lieu of which they are issued and with such
variations in form from the forms of the Certificates set forth as Exhibits A
and B hereto as the Trustee's officers executing such Certificates may
determine, as evidenced by their execution of the Certificates. Notwithstanding
the foregoing, the Certificates may remain in the form set forth in this
Section.
If temporary Certificates are issued, the Trustee shall cause
definitive Certificates to be prepared within ten Business Days of the Closing
Date or as soon as practicable thereafter. After preparation of definitive
Certificates, the temporary Certificates shall be exchangeable for definitive
Certificates upon surrender of the temporary Certificates, without charge to the
Holder. Any tax or governmental charge that may be imposed in connection with
any such exchange shall be borne by the Depositor. Upon surrender for
cancellation of any one or more temporary Certificates, the Trustee shall
execute and the Trustee shall authenticate and deliver in exchange therefor a
like principal amount of definitive Certificates of Authorized Denominations.
Until so exchanged, the temporary Certificates shall in all respects be entitled
to the same benefits under this Agreement as definitive Certificates.
Section 5.7 Book-Entry for Book-Entry Certificates. Notwithstanding the
foregoing, the Book-Entry Certificates, upon original issuance, shall be issued
in the form of one or more typewritten Certificates of Authorized Denomination
representing the Book-Entry Certificates, to be delivered to the Depository, the
initial Clearing Agency, by, or on behalf of, the Depositor. The Book-Entry
Certificates shall initially be registered on the Certificate Register in the
name of Cede & Co., the nominee of the Depository, as the initial Clearing
Agency, and no Beneficial Holder shall receive a definitive certificate
representing such Beneficial Holder's interest in any Class of Book-Entry
Certificate, except as provided above and in Section 5.9. Each Book-Entry
Certificate shall bear the following legend:
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Unless this Certificate is presented by an authorized
representative of The Depository Trust Company, a New York corporation
("DTC"), to the Trustee or its agent for registration of transfer,
exchange, or payment, and any Certificate issued is registered in the
name of Cede & Co. or such other name as is requested by an authorized
representative of DTC (and any payment is made to Cede & Co. or to such
other entity as is requested by an authorized representative of DTC),
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede
& Co., has an interest herein.
Unless and until definitive, fully registered Book-Entry Certificates
(the "Definitive Certificates") have been issued to the Beneficial Holders
pursuant to Section 5.9:
(a) the provisions of this Section 5.7 shall be in full force and
effect with respect to the Book-Entry Certificates;
(b) the Securities Administrator, if any, and the Trustee may deal with
the Clearing Agency for all purposes with respect to the Book-Entry Certificates
(including the making of distributions on the Book-Entry Certificates) as the
sole Certificateholder;
(c) to the extent that the provisions of this Section 5.7 conflict with
any other provisions of this Agreement, the provisions of this Section 5.7 shall
control; and
(d) the rights of the Beneficial Holders shall be exercised only
through the Clearing Agency and the Depository Participants and shall be limited
to those established by law and agreements between such Beneficial Holders and
the Clearing Agency and/or the Depository Participants. Pursuant to the
Depositary Agreement, unless and until Definitive Certificates are issued
pursuant to Section 5.9, the initial Clearing Agency will make book-entry
transfers among the Depository Participants and receive and transmit
distributions of principal and interest on the related Class of Book-Entry
Certificates to such Depository Participants.
For purposes of any provision of this Agreement requiring or permitting
actions with the consent of, or at the direction of, Holders of Book-Entry
Certificates evidencing a specified Percentage Interest, such direction or
consent may be given by the Clearing Agency at the direction of Beneficial
Holders owning Book-Entry Certificates evidencing the requisite Percentage
Interest represented by the Book-Entry Certificates. The Clearing Agency may
take conflicting actions with respect to the Book-Entry Certificates to the
extent that such actions are taken on behalf of the Beneficial Holders.
Section 5.8 Notices to Clearing Agency. Whenever notice or other
communication to the Certificateholders is required under this Agreement, unless
and until Definitive Certificates shall have been issued to the related
Certificateholders pursuant to Section 5.9, the Trustee shall give all such
notices and communications specified herein to be given to Holders of the
Book-Entry
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Certificates to the Clearing Agency which shall give such notices and
communications to the related Depository Participants in accordance with its
applicable rules, regulations and procedures.
Section 5.9 Definitive Certificates. If (a) the Clearing Agency
notifies the Trustee that it is no longer willing or able to discharge properly
its responsibilities under the Depositary Agreement with respect to the
Book-Entry Certificates and the Trustee is unable to locate a qualified
successor, (b) the Depositor, at its option, advises the Trustee in writing that
it elects to terminate the book-entry system with respect to the Book-Entry
Certificates through the Clearing Agency or (c) after the occurrence of an Event
of Default, Certificateholders holding Book-Entry Certificates evidencing
Percentage Interests aggregating not less than 66% of the aggregate Class
Principal Balance of the Book-Entry Certificates advise the Trustee and the
Clearing Agency through Depository Participants in writing that the continuation
of a book-entry system with respect to the Book-Entry Certificates through the
Clearing Agency is no longer in the best interests of the Certificateholders
with respect to such Certificates, the Trustee shall notify or cause to be
notified all Certificateholders of Book-Entry Certificates listed on a list
delivered to it by the Depository of the occurrence of any such event and of the
availability of Definitive Certificates. Upon surrender to the Trustee of the
Book-Entry Certificates by the Clearing Agency, accompanied by registration
instructions from the Clearing Agency for registration, the Trustee shall
execute and the Trustee shall authenticate and deliver the Definitive
Certificates. Neither the Depositor nor the Trustee shall be liable for any
delay in delivery of such instructions and may conclusively rely on, and shall
be protected in relying on, such instructions. Upon the issuance of Definitive
Certificates for all of the Certificates all references herein to obligations
imposed upon or to be performed by the Clearing Agency shall be deemed to be
imposed upon and performed by the Trustee and the Certificate Registrar shall
recognize the Holders of Definitive Certificates as Certificateholders
hereunder.
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ARTICLE VI
THE DEPOSITOR AND THE MASTER SERVICER
Section 6.1 Liability of the Depositor and the Master Servicer.
The Depositor and the Master Servicer each shall be liable in
accordance herewith only to the extent of the obligations specifically imposed
by this Agreement upon them in their respective capacities as Depositor and
Master Servicer and undertaken hereunder by the Depositor and the Master
Servicer herein.
Section 6.2 Merger or Consolidation of the Depositor or the Master
Servicer.
Subject to the following paragraph, the Depositor will keep in full
effect its existence, rights and franchises as a corporation under the laws of
the jurisdiction of its incorporation. Subject to the following paragraph, the
Master Servicer will keep in full effect its existence, rights and franchises as
a corporation under the laws of the jurisdiction of its formation. The Depositor
and the Master Servicer each will obtain and preserve its qualification to do
business as a foreign corporation in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, the Certificates or any of the Mortgage Loans
and to perform its respective duties under this Agreement.
The Depositor or the Master Servicer may be merged or consolidated with
or into any Person, or transfer all or substantially all of its assets to any
Person, in which case any Person resulting from any merger or consolidation to
which the Depositor or the Master Servicer shall be a party, or any Person
succeeding to the business of the Depositor or the Master Servicer, shall be the
successor of the Depositor or the Master Servicer, as the case may be,
hereunder, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding; provided, however, the Rating Agencies' ratings of the
Certificates in effect immediately prior to such merger or consolidation will
not be qualified, reduced or withdrawn as a result thereof (as evidenced by a
letter to such effect from the Rating Agencies).
Section 6.3 Limitation on Liability of the Depositor, the Master
Servicer, the Servicers, the Securities Administrator and Others.
None of the Depositor, the Master Servicer, the Securities
Administrator, the Servicers or any of the directors, officers, employees or
agents of the Depositor, the Master Servicer, the Securities Administrator or
the Servicers shall be under any liability to the Trust Fund or the
Certificateholders for any action taken or for refraining from the taking of any
action in good faith pursuant to this Agreement or the Servicing Agreements, or
for errors in judgment; provided, however, that this provision shall not protect
the Depositor, the Master Servicer, the Securities Administrator or any such
person against any breach of warranties, representations or covenants made
herein or in the Servicing Agreements, or against any specific liability imposed
on the Master Servicer, the Securities
80
Administrator or the Servicers pursuant hereto or pursuant to the Servicing
Agreements, or against any liability which would otherwise be imposed by reason
of willful misfeasance, bad faith or gross negligence in the performance of
duties or by reason of reckless disregard of obligations and duties hereunder or
under the Servicing Agreements. The Depositor, the Master Servicer, the
Securities Administrator, the Servicers and any director, officer, employee or
agent of the Depositor, the Master Servicer, the Securities Administrator or the
Servicers 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 or under the Servicing Agreements. The Depositor, the Master Servicer,
the Servicers, the Securities Administrator, the Custodian and any director,
officer, employee or agent of the Depositor, the Master Servicer, the Servicers,
the Custodian or the Securities Administrator shall be indemnified and held
harmless by the Trust Fund against any loss, liability or expense incurred in
connection with any legal action relating to this Agreement, the Certificates or
any Servicing Agreement, or any loss, liability or expense incurred by any of
such Persons other than by reason of such Person's willful misfeasance, bad
faith or gross negligence in the performance of its duties hereunder or by
reason of reckless disregard of its obligations and duties hereunder. None of
the Depositor, the Master Servicer, the Securities Administrator, the Custodian
or any Servicer shall be under any obligation to appear in, prosecute or defend
any legal action unless such action is related to its respective duties under
this Agreement, the Custodial Agreement or the applicable Servicing Agreement
and, in its opinion, does not involve it in any expense or liability; provided,
however, that each of the Depositor, the Master Servicer, the Custodian and the
Securities Administrator may in its discretion undertake any such action which
it may deem necessary or desirable with respect to this Agreement and the rights
and duties of the parties hereto and the interests of the Certificateholders
hereunder. In such event, the legal expenses and costs of such action and any
liability resulting therefrom (except any loss, liability or expense incurred by
reason of willful misfeasance, bad faith or gross negligence in the performance
of duties hereunder or by reason of reckless disregard of obligations and duties
hereunder) shall be expenses, costs and liabilities of the Trust Fund, and the
Depositor, the Master Servicer, the Custodian, the Servicers and the Securities
Administrator shall be entitled to be reimbursed therefor from the Master
Servicer Collection Account as and to the extent provided in Article III, any
such right of reimbursement being prior to the rights of the Certificateholders
to receive any amount in the Master Servicer Collection Account.
Section 6.4 Limitation on Resignation of the Master Servicer.
The Master Servicer shall not resign from the obligations and duties
hereby imposed on it except upon determination that its duties hereunder are no
longer permissible under applicable law. Any such determination pursuant to the
preceding sentence permitting the resignation of the Master Servicer shall be
evidenced by an Opinion of Counsel to such effect obtained at the expense of the
Master Servicer and delivered to the Trustee and the Rating Agencies. No
resignation of the Master Servicer shall become effective until the Trustee or a
successor Master Servicer shall have assumed the Master Servicer's
responsibilities, duties, liabilities (other than those liabilities arising
prior to the appointment of such successor) and obligations under this
Agreement.
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Section 6.5 Assignment of Master Servicing.
The Master Servicer may sell and assign its rights and delegate its
duties and obligations in its entirety as Master Servicer under this Agreement;
provided, however, that: (i) the purchaser or transferee accepting such
assignment and delegation (a) shall be a Person which shall be qualified to
service mortgage loans for Xxxxxx Xxx or Xxxxxxx Mac; (b) shall have a net worth
of not less than $15,000,000 (unless otherwise approved by each Rating Agency
pursuant to clause (ii) below); (c) shall be reasonably satisfactory to the
Trustee (as evidenced in a writing signed by the Trustee); and (d) shall execute
and deliver to the Trustee an agreement, in form and substance reasonably
satisfactory to the Trustee, which contains an assumption by such Person of the
due and punctual performance and observance of each covenant and condition to be
performed or observed by it as master servicer under this Agreement, any
custodial agreement from and after the effective date of such agreement; (ii)
each Rating Agency shall be given prior written notice of the identity of the
proposed successor to the Master Servicer and each Rating Agency's rating of the
Certificates in effect immediately prior to such assignment, sale and delegation
will not be downgraded, qualified or withdrawn as a result of such assignment,
sale and delegation, as evidenced by a letter to such effect delivered to the
Master Servicer and the Trustee; and (iii) the Master Servicer assigning and
selling the master servicing shall deliver to the Trustee an officer's
certificate and an Opinion of Independent counsel, each stating that all
conditions precedent to such action under this Agreement have been completed and
such action is permitted by and complies with the terms of this Agreement. No
such assignment or delegation shall affect any liability of the Master Servicer
arising prior to the effective date thereof.
Section 6.6 Rights of the Depositor in Respect of the Master Servicer.
The Master Servicer shall afford the Depositor and the Trustee, upon
reasonable notice, during normal business hours, access to all records
maintained by the Master Servicer in respect of the Master Servicer's rights and
obligations hereunder and access to officers of the Master Servicer responsible
for such obligations. Upon request, the Master Servicer shall furnish to the
Depositor and the Trustee the most recent financial statements of its parent and
such other information relating to the Master Servicer's capacity to perform its
obligations under this Agreement as it possesses. To the extent such information
is not otherwise available to the public, the Depositor and the Trustee shall
not disseminate any information obtained pursuant to the preceding two sentences
without the Master Servicer's written consent, except as required pursuant to
this Agreement or to the extent that it is appropriate to do so (i) in working
with legal counsel, auditors, taxing authorities or other governmental agencies
or (ii) pursuant to any law, rule, regulation, order, judgment, writ, injunction
or decree of any court or governmental authority having jurisdiction over the
Depositor, the Trustee or the Trust, and in any case, the Depositor or the
Trustee, as the case may be, shall use its best efforts to assure the
confidentiality of any such disseminated non-public information. The Depositor
may, but is not obligated to, enforce the obligations of the Master Servicer
under this Agreement and may, but is not obligated to, perform, or cause a
designee to perform, any defaulted obligation of the Master Servicer under this
Agreement or exercise the rights of the Master Servicer under this Agreement;
provided that the Master Servicer shall not be relieved of any of its
obligations under
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this Agreement by virtue of such performance by the Depositor or its designee.
The Depositor shall not have any responsibility or liability for any action or
failure to act by the Master Servicer and is not obligated to supervise the
performance of the Master Servicer under this Agreement or otherwise.
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ARTICLE VII
DEFAULT
Section 7.1 Master Servicer Events of Default.
(a) "Master Servicer Event of Default," wherever used herein, means
any one of the following events:
(i) any failure by the Master Servicer to remit to the Trustee
for distribution to the Certificateholders any amounts (other than an
Advance required to be made from its own funds on any Distribution
Account Deposit Date pursuant to Section 4.4) received by it and
required to be remitted to the Trustee under the terms of this
Agreement which continues unremedied for a period of one Business Day
after the date upon which written notice of such failure, requiring the
same to be remedied, shall have been given to the Master Servicer by
the Depositor or the Trustee (in which case notice shall be provided by
telecopy), or to the Master Servicer, the Depositor, the Trustee and by
the Holders of Certificates evidencing, in aggregate, not less than 25%
of the Trust Fund; or
(ii) any failure on the part of the Master Servicer duly to
observe or perform in any material respect any other of the covenants
or agreements on the part of the Master Servicer contained in this
Agreement, or the breach by the Master Servicer of any representation
and warranty contained in Section 2.5, which continues unremedied for a
period of 30 days after the date on which written notice of such
failure, requiring the same to be remedied, shall have been given to
the Master Servicer by the Depositor or the Trustee or to the Master
Servicer, the Depositor and the Trustee by the Holders of Certificates
evidencing, in aggregate, not less than 25% of the Trust Fund; or
(iii) a decree or order of a court or agency or supervisory
authority having jurisdiction in the premises in an involuntary case
under any present or future federal or state bankruptcy, insolvency or
similar law or the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of debt, marshalling of
assets and liabilities or similar proceeding, or for the winding-up or
liquidation of its affairs, shall have been entered against the Master
Servicer and such decree or order shall have remained in force
undischarged or unstayed for a period of 90 days; or
(iv) the Master Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment
of debt, marshalling of assets and liabilities or similar proceedings
of or relating to it or of or relating to all or substantially all of
its property; or
(v) the Master Servicer shall admit in writing its inability
to pay its debts generally as they become due, file a petition to take
advantage of any applicable insolvency
84
or reorganization statute, make an assignment for the benefit of its
creditors, or voluntarily suspend payment of its obligations; or
(vi) any failure of the Master Servicer to make any Advance on
any Distribution Account Deposit Date required to be made from its own
funds pursuant to Section 4.4 which continues unremedied until 3:00
p.m. New York time on the Business Day immediately following the
Distribution Account Deposit Date.
If a Master Servicer Event of Default described in clauses (ii) through (v) of
this Section shall occur, then, and in each and every such case, so long as such
Master Servicer Event of Default shall not have been remedied, the Depositor or
the Trustee may, and at the written direction of the Holders of Certificates
evidencing, in aggregate, not less than 51% of the Trust Fund, the Trustee
shall, by notice in writing to the Master Servicer (and to the Depositor if
given by the Trustee or to the Trustee if given by the Depositor) with a copy to
each Rating Agency, terminate all of the rights and obligations of the Master
Servicer in its capacity as Master Servicer under this Agreement, to the extent
permitted by law, and in and to the Loans and the proceeds thereof. Except as
otherwise provided in Section 7.4, if a Master Servicer Event of Default
described in clause (i) or clause (vi) hereof shall occur, the Trustee shall, by
notice in writing to the Master Servicer and the Depositor, terminate all of the
rights and obligations of the Master Servicer in its capacity as Master Servicer
under this Agreement and in and to the Loans and the proceeds thereof. On or
after the receipt by the Master Servicer of such written notice, all authority
and power of the Master Servicer under this Agreement, whether with respect to
the Certificates (other than as a Holder of any Certificate) or the Loans or
otherwise, shall pass to and be vested in the Trustee pursuant to and under this
Section, and, without limitation, the Trustee is hereby authorized and
empowered, as attorney-in-fact or otherwise, to execute and deliver, on behalf
of and at the expense of the Master Servicer, any and all documents and other
instruments and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement or assignment of the Loans and related
documents, or otherwise. The Master Servicer agrees promptly (and in any event
no later than ten Business Days subsequent to such notice) to provide the
Trustee with all documents and records requested by it to enable it to assume
the Master Servicer's functions under this Agreement, and to cooperate with the
Trustee in effecting the termination of the Master Servicer's responsibilities
and rights under this Agreement, including, without limitation, the transfer
within one Business Day to the Trustee for administration by it of all cash
amounts which at the time shall be or should have been credited by the Master
Servicer to the Master Servicer Collection Account held by or on behalf of the
Master Servicer or thereafter be received with respect to the Loans or any REO
Property (provided, however, that the Master Servicer shall continue to be
entitled to receive all amounts accrued or owing to it under this Agreement on
or prior to the date of such termination, whether in respect of Advances or
otherwise, and shall continue to be entitled to the benefits of Section 6.3,
notwithstanding any such termination, with respect to events occurring prior to
such termination). For purposes of this Section 7.1, the Trustee shall not be
deemed to have knowledge of a Master Servicer Event of Default unless a
Responsible Officer of the Trustee assigned to and working in the Trustee's
Corporate Trust Office has actual knowledge thereof or unless written notice of
any event which is in fact such a Master Servicer Event of Default is
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received by the Trustee and such notice references the Certificates, the Trust
or this Agreement. The Trustee shall promptly notify the Rating Agencies of the
occurrence of a Master Servicer Event of Default of which it has knowledge as
provided above.
Section 7.2 Trustee to Act; Appointment of Successor.
On and after the time the Master Servicer receives a notice of
termination, the Trustee shall be the successor in all respects to the Master
Servicer in its capacity as Master Servicer under this Agreement and the
transactions set forth or provided for herein, and all the responsibilities,
duties and liabilities relating thereto and arising thereafter shall be assumed
by the Trustee (except for any representations or warranties of the Master
Servicer under this Agreement, the responsibilities, duties and liabilities
contained in Section 2.3 and the obligation to deposit amounts in respect of
losses pursuant to Section 3.23(c)) by the terms and provisions hereof
including, without limitation, the Master Servicer's obligations to make
Advances pursuant to Section 4.4; provided, however, that if the Trustee is
prohibited by law or regulation from obligating itself to make advances
regarding delinquent mortgage loans, then the Trustee shall not be obligated to
make Advances pursuant to Section 4.4; and provided further, that any failure to
perform such duties or responsibilities caused by the Master Servicer's failure
to provide information required by Section 7.1 shall not be considered a default
by the Trustee as successor to the Master Servicer hereunder. As compensation
therefor, the Trustee shall be entitled to the Master Servicing Fee and all
funds relating to the Loans, investment earnings on the Master Servicer
Collection Account and the Distribution Account and all other renumeration to
which the Master Servicer would have been entitled if it had continued to act
hereunder. Notwithstanding the above and subject to the immediately following
paragraph, the Trustee may, if it shall be unwilling to so act, or shall, if it
is unable to so act or if it is prohibited by law from making advances regarding
delinquent mortgage loans or if the Holders of Certificates evidencing, in
aggregate, not less than 51% of the Trust Fund so request in writing promptly
appoint or petition a court of competent jurisdiction to appoint, an established
mortgage loan servicing institution acceptable to each Rating Agency and having
a net worth of not less than $15,000,000, as the successor to the Master
Servicer under this Agreement in the assumption of all or any part of the
responsibilities, duties or liabilities of the Master Servicer under this
Agreement.
No appointment of a successor to the Master Servicer under
this Agreement shall be effective until the assumption by the successor of all
of the Master Servicer's responsibilities, duties and liabilities hereunder. In
connection with such appointment and assumption described herein, the Trustee
may make such arrangements for the compensation of such successor out of
payments on Loans as it and such successor shall agree; provided, however, that
no such compensation shall be in excess of that permitted the Master Servicer as
such hereunder. The Depositor, the Trustee and such successor shall take such
action, consistent with this Agreement, as shall be necessary to effectuate any
such succession. Pending appointment of a successor to the Master Servicer under
this Agreement, the Trustee shall act in such capacity as hereinabove provided.
The transition costs and expenses incurred by the Trustee in connection with the
replacement of the Master Servicer shall be reimbursed out of the Trust.
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Section 7.3 Notification to Certificateholders.
(a) Upon any termination of the Master Servicer pursuant to Section 7.1
above or any appointment of a successor to the Master Servicer pursuant to
Section 7.2 above, the Trustee shall give prompt written notice thereof to the
Certificateholders at their respective addresses appearing in the Certificate
Register.
(b) Not later than the later of 60 days after the occurrence of any
event, which constitutes or which, with notice or lapse of time or both, would
constitute a Master Servicer Event of Default or five days after a Responsible
Officer of the Trustee becomes aware of the occurrence of such an event, the
Trustee shall transmit by mail to all Holders of Certificates notice of each
such occurrence, unless such default or Master Servicer Event of Default shall
have been cured or waived.
Section 7.4 Waiver of Master Servicer Events of Default.
The Holders evidencing, in aggregate, not less than 66% of the
aggregate Percentage Interests of all Classes of Certificates affected by any
default or Master Servicer Event of Default hereunder may waive such default or
Master Servicer Event of Default; provided, however, that a default or Master
Servicer Event of Default under clause (i) or (vi) of Section 7.1 may be waived
only by all of the Holders of the Regular Interest Certificates. Upon any such
waiver of a default or Master Servicer Event of Default, such default or Master
Servicer Event of Default shall cease to exist and shall be deemed to have been
remedied for every purpose hereunder. No such waiver shall extend to any
subsequent or other default or Master Servicer Event of Default or impair any
right consequent thereon except to the extent expressly so waived.
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ARTICLE VIII
CONCERNING THE TRUSTEE AND THE SECURITIES ADMINISTRATOR
Section 8.1 Duties of Trustee and Securities Administrator.
The Trustee, prior to the occurrence of a Master Servicer Event of
Default and after the curing or waiver of all Master Servicer Events of Default
which may have occurred, and the Securities Administrator each undertake to
perform such duties and only such duties as are specifically set forth in this
Agreement as duties of the Trustee and the Securities Administrator,
respectively. During the continuance of a Master Servicer Event of Default, the
Trustee shall exercise such of the rights and powers vested in it by this
Agreement, and use the same degree of care and skill in its exercise as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs. Any permissive right of the Trustee enumerated in
this Agreement shall not be construed as a duty.
Each of the Trustee and the Securities Administrator, upon receipt of
all resolutions, certificates, statements, opinions, reports, documents, orders
or other instruments furnished to it, which are specifically required to be
furnished pursuant to any provision of this Agreement, shall examine them to
determine whether they conform on their face to the requirements of this
Agreement. If any such instrument is found not to conform on its face to the
requirements of this Agreement, the Trustee or the Securities Administrator, as
the case may be, shall take such action as it deems appropriate to have the
instrument corrected, and if the instrument is not corrected to its
satisfaction, the Securities Administrator will provide notice to the Trustee
thereof and the Trustee will provide notice to the Certificateholders.
No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own misconduct; provided, however, that:
(i) Prior to the occurrence of a Master Servicer Event of
Default, and after the curing or waiver of all such Master Servicer
Events of Default which may have occurred with respect to the Trustee
and at all times with respect to the Securities Administrator, the
duties and obligations of the Trustee shall be determined solely by the
express provisions of this Agreement, neither the Trustee nor the
Securities Administrator shall be liable except for the performance of
such duties and obligations as are specifically set forth in this
Agreement, no implied covenants or obligations shall be read into this
Agreement against the Trustee or the Securities Administrator and, in
the absence of bad faith on the part of the Trustee or the Securities
Administrator, respectively, the Trustee or the Securities
Administrator, respectively, may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed therein,
upon any certificates or opinions furnished to the Trustee or the
Securities Administrator, respectively, that conform to the
requirements of this Agreement;
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(ii) Neither the Trustee nor the Securities Administrator
shall be liable for an error of judgment made in good faith by a
Responsible Officer or Responsible Officers of the Trustee or an
officer or officers of the Securities Administrator, respectively,
unless it shall be proved that the Trustee or the Securities
Administrator, respectively, was negligent in ascertaining the
pertinent facts; and
(iii) Neither the Trustee nor the Securities Administrator
shall be liable with respect to any action taken, suffered or omitted
to be taken by it in good faith in accordance with the direction of the
Holders of Certificates evidencing, in aggregate, not less than 25% of
the Trust Fund relating to the time, method and place of conducting any
proceeding for any remedy available to the Trustee or the Securities
Administrator or exercising any trust or power conferred upon the
Trustee or the Securities Administrator under this Agreement.
Section 8.2 Certain Matters Affecting Trustee and Securities
Administrator.
(a) Except as otherwise provided in Section 8.1:
(i) The Trustee and the Securities Administrator may request
and rely upon and shall be protected in acting or refraining from
acting upon any resolution, Officers' Certificate, certificate of
auditors or any other certificate, statement, instrument, opinion,
report, notice, request, consent, order, appraisal, bond or other paper
or document reasonably believed by it to be genuine and to have been
signed or presented by the proper party or parties;
(ii) The Trustee and the Securities Administrator may consult
with counsel of its selection and any advice of such counsel or any
Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken or suffered or omitted by it
hereunder in good faith and in accordance with such advice or Opinion
of Counsel;
(iii) Neither the Trustee nor the Securities Administrator
shall be under any obligation to exercise any of the trusts or powers
vested in it by this Agreement or to institute, conduct or defend any
litigation hereunder or in relation hereto at the request, order or
direction of any of the Certificateholders, pursuant to the provisions
of this Agreement, unless such Certificateholders shall have offered to
the Trustee or the Securities Administrator, as the case may be,
reasonable security or indemnity satisfactory to it against the costs,
expenses and liabilities which may be incurred therein or thereby;
nothing contained herein shall, however, relieve the Trustee of the
obligation, upon the occurrence of a Master Servicer Event of Default
(which has not been cured or waived), to exercise such of the rights
and powers vested in it by this Agreement, and to use the same degree
of care and skill in their exercise as a prudent person would exercise
or use under the circumstances in the conduct of such person's own
affairs;
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(iv) Neither the Trustee nor the Securities Administrator
shall be liable for any action taken, suffered or omitted by it in good
faith and believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Agreement;
(v) Prior to the occurrence of a Master Servicer Event of
Default hereunder and after the curing or waiver of all Master Servicer
Events of Default which may have occurred with respect to the Trustee
and at all times with respect to the Securities Administrator, neither
the Trustee nor the Securities Administrator shall be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
consent, order, approval, bond or other paper or document, unless
requested in writing to do so by the Holders of Certificates
evidencing, in aggregate, not less than 25% of the Trust Fund;
provided, however, that if the payment within a reasonable time to the
Trustee or the Securities Administrator of the costs, expenses or
liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee or the Securities
Administrator, as applicable, not reasonably assured to the Trustee or
the Securities Administrator by such Certificateholders, the Trustee or
the Securities Administrator, as applicable, may require reasonable
indemnity satisfactory to it against such expense, or liability from
such Certificateholders as a condition to taking any such action;
(vi) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys and the Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or attorney
appointed with due care by it hereunder;
(vii) The Trustee shall not be liable for any loss resulting
from the investment of funds held in the Master Servicer Collection
Account or the Distribution Account at the direction of the Master
Servicer pursuant to Section 3.23(c) or Section 3.25;
(viii) Neither the Trustee nor the Securities Administrator
shall be liable for any action taken, suffered, or omitted to be taken
by it in good faith and reasonably believed by it to be authorized or
within the discretion or rights or powers conferred upon it by this
Agreement;
(ix) the Trustee shall not be deemed to have notice of any
default or Master Servicer Event of Default unless a Responsible
Officer of the Trustee has actual knowledge thereof or unless written
notice of any event which is in fact such a default is received by the
Trustee at the Corporate Trust Office of the Trustee, and such notice
references the Certificates and this Agreement; and
(x) the rights, privileges, protections, immunities and
benefits given to the Trustee, including, without limitation, its right
to be indemnified, are extended to, and shall be enforceable by, each
agent, custodian and other Person employed to act hereunder.
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(b) All rights of action under this Agreement or under any of the
Certificates, enforceable by the Trustee, may be enforced by it without the
possession of any of the Certificates, or the production thereof at the trial or
other proceeding relating thereto, and any such suit, action or proceeding
instituted by the Trustee shall be brought in its name for the benefit of all
the Holders of such Certificates, subject to the provisions of this Agreement.
Section 8.3 Trustee and Securities Administrator not Liable for
Certificates or Loans.
The recitals contained herein and in the Certificates (other than the
signature of the Trustee, the authentication of the Trustee on the Certificates,
the acknowledgments of the Trustee contained in Article II and the
representations and warranties of the Trustee in Section 8.12) shall be taken as
the statements of the Depositor and neither the Trustee nor the Securities
Administrator assumes any responsibility for their correctness. Neither the
Trustee nor the Securities Administrator makes any representations or warranties
as to the validity or sufficiency of this Agreement (other than as specifically
set forth in Section 8.12) or of the Certificates (other than the signature of
the Trustee and authentication of the Trustee on the Certificates) or of any
Loan or related document. The Trustee shall not be accountable for the use or
application by the Depositor of any of the Certificates or of the proceeds of
such Certificates, or for the use or application of any funds paid to the
Depositor or the Master Servicer in respect of the Loans or deposited in or
withdrawn from the Master Servicer Collection Account by the Master Servicer.
Section 8.4 Trustee and Securities Administrator May Own
Certificates.
Each of the Trustee and the Securities Administrator in its individual
capacity or any other capacity may become the owner or pledgee of Certificates
and may transact business with other interested parties and their Affiliates
with the same rights it would have if it were not Trustee or the Securities
Administrator.
Section 8.5 Fees and Expenses of Trustee and Securities
Administrator.
The fees of the Trustee and the Securities Administrator hereunder and
of Xxxxx Fargo under the Custodial Agreement shall be paid in accordance with a
side letter agreement with the Master Servicer and at the sole expense of the
Master Servicer. In addition, the Trustee, the Securities Administrator, the
Custodian and any director, officer, employee or agent of the Trustee, the
Securities Administrator and the Custodian shall be indemnified by the Trust and
held harmless against any loss, liability or expense (including reasonable
attorney's fees and expenses) incurred by the Trustee or the Securities
Administrator in connection with any default administration to be performed by
the Trustee or the Securities Administrator pursuant to this Agreement or other
agreements related hereto and any claim or legal action or any pending or
threatened claim or legal action arising out of or in connection with the
acceptance or administration of its respective obligations and duties under this
Agreement, including other agreements related hereto, other than any loss,
liability or expense (i) for which the Trustee is indemnified by the Master
Servicer, (ii) that constitutes a specific liability of the Trustee or the
Securities Administrator pursuant to Section
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10.1(g) or (iii) any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or gross negligence in the performance of duties
hereunder by reason of reckless disregard of obligations and duties hereunder.
The Master Servicer agrees to indemnify the Trustee, from, and hold the Trustee
harmless against, any loss, liability or expense (including reasonable
attorney's fees and expenses) incurred by the Trustee by reason of the Master
Servicer's willful misfeasance, bad faith or gross negligence in the performance
of its duties under this Agreement or by reason of the Master Servicer's
reckless disregard of its obligations and duties under this Agreement. Such
indemnity shall survive the termination or discharge of this Agreement and the
resignation or removal of the Trustee. Any payment hereunder made by the Master
Servicer to the Trustee shall be from the Master Servicer's own funds, without
reimbursement from REMIC I therefor.
Section 8.6 Eligibility Requirements for Trustee and Securities
Administrator.
The Trustee and the Securities Administrator shall at all times be a
corporation or an association (other than the Depositor, the Seller, the Master
Servicer or any Affiliate of the foregoing) organized and doing business under
the laws of any state or the United States of America, authorized under such
laws to exercise corporate trust powers, having a combined capital and surplus
of at least $50,000,000 (or a member of a bank holding company whose capital and
surplus is at least $50,000,000) and subject to supervision or examination by
federal or state authority. If such corporation or association publishes reports
of conditions at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section the combined capital and surplus of such corporation or association
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of conditions so published. In case at any time the Trustee or the
Securities Administrator, as applicable, shall cease to be eligible in
accordance with the provisions of this Section, the Trustee or the Securities
Administrator, as applicable, shall resign immediately in the manner and with
the effect specified in Section 8.7.
Section 8.7 Resignation and Removal of Trustee and Securities
Administrator.
The Trustee and the Securities Administrator may at any time resign and
be discharged from the trust hereby created by giving written notice thereof to
the Depositor, to the Master Servicer, to the Securities Administrator (or the
Trustee, if the Securities Administrator resigns) and to the Certificateholders.
Upon receiving such notice of resignation, the Depositor shall promptly appoint
a successor trustee or successor securities administrator by written instrument,
in duplicate, which instrument shall be delivered to the resigning Trustee or
Securities Administrator, as applicable, and to the successor trustee or
successor securities administrator, as applicable. A copy of such instrument
shall be delivered to the Certificateholders, the Trustee, the Securities
Administrator and the Master Servicer by the Depositor. If no successor trustee
or successor securities administrator shall have been so appointed and have
accepted appointment within 30 days after the giving of such notice of
resignation, the resigning Trustee or Securities Administrator, as the case may
be, may, at the expense of the Trust Fund, petition any court of competent
jurisdiction for the appointment of a successor trustee, successor securities
administrator, Trustee or Securities Administrator, as applicable.
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If at any time the Trustee or the Securities Administrator shall cease
to be eligible in accordance with the provisions of Section 8.6 and shall fail
to resign after written request therefor by the Depositor, or if at any time the
Trustee or the Securities Administrator shall become incapable of acting, or
shall be adjudged bankrupt or insolvent, or a receiver of the Trustee or the
Securities Administrator or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or the Securities
Administrator or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then the Depositor may remove the Trustee or the
Securities Administrator, as applicable and appoint a successor trustee or
successor securities administrator, as applicable, by written instrument, in
duplicate, which instrument shall be delivered to the Trustee or the Securities
Administrator so removed and to the successor trustee or successor securities
administrator. A copy of such instrument shall be delivered to the
Certificateholders, the Trustee, the Securities Administrator and the Master
Servicer by the Depositor.
The Holders of Certificates evidencing, in aggregate, not less than 51%
of the Trust Fund may at any time remove the Trustee or the Securities
Administrator and appoint a successor trustee or successor securities
administrator by written instrument or instruments, in triplicate, signed by
such Holders or their attorneys-in-fact duly authorized, one complete set of
which instruments shall be delivered to the Depositor, one complete set to the
Trustee or the Securities Administrator so removed and one complete set to the
successor so appointed. A copy of such instrument shall be delivered to the
Certificateholders, the Trustee (in the case of the removal of the Securities
Administrator), the Securities Administrator (in the case of the removal of the
Trustee) and the Master Servicer by the Depositor. All costs and expenses
incurred by the Trustee in connection with its removal without cause hereunder
shall be reimbursed to it by the Trust Fund.
Any resignation or removal of the Trustee or the Securities
Administrator and appointment of a successor trustee or successor securities
administrator pursuant to any of the provisions of this Section shall not become
effective until acceptance of appointment by the successor trustee or successor
securities administrator, as applicable, as provided in Section 8.8.
Notwithstanding anything to the contrary contained herein, the Master
Servicer and the Securities Administrator shall at all times be the same Person.
Section 8.8 Successor Trustee or Securities Administrator.
Any successor trustee or successor securities administrator appointed
as provided in Section 8.7 shall execute, acknowledge and deliver to the
Depositor and its predecessor trustee or predecessor securities administrator an
instrument accepting such appointment hereunder, and thereupon the resignation
or removal of the predecessor trustee or predecessor securities administrator
shall become effective and such successor trustee or successor securities
administrator without any further act, deed or conveyance, shall become fully
vested with all the rights, powers, duties and obligations of its predecessor
hereunder, with the like effect as if originally named as trustee or securities
administrator herein. The predecessor trustee or predecessor securities
administrator shall deliver to the successor trustee or successor securities
administrator all Loan
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Documents and related documents and statements to the extent held by it
hereunder, as well as all moneys, held by it hereunder, and the Depositor and
the predecessor trustee or predecessor securities administrator shall execute
and deliver such instruments and do such other things as may reasonably be
required for more fully and certainly vesting and confirming in the successor
trustee or successor securities administrator all such rights, powers, duties
and obligations.
No successor trustee or successor securities administrator shall accept
appointment as provided in this Section unless at the time of such acceptance
such successor trustee or successor securities administrator shall be eligible
under the provisions of Section 8.6 and the appointment of such successor
trustee or successor securities administrator shall not result in a downgrading
of any Class of Certificates by any Rating Agency, as evidenced by a letter from
each Rating Agency.
Upon acceptance of appointment by a successor trustee or successor
securities administrator as provided in this Section, the Depositor shall mail
notice of the succession of such trustee hereunder to all Holders of
Certificates at their addresses as shown in the Certificate Register. If the
Depositor fails to mail such notice within 10 days after acceptance of
appointment by the successor trustee or successor securities administrator, the
successor trustee or successor securities administrator shall cause such notice
to be mailed at the expense of the Depositor.
Section 8.9 Merger or Consolidation of Trustee or Securities
Administrator.
Any corporation or association into which the Trustee or the Securities
Administrator may be merged or converted or with which it may be consolidated or
any corporation or association resulting from any merger, conversion or
consolidation to which the Trustee or the Securities Administrator shall be a
party, or any corporation or association succeeding to the business of the
Trustee or the Securities Administrator shall be the successor of the Trustee or
the Securities Administrator hereunder, provided such corporation or association
shall be eligible under the provisions of Section 8.6, without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.
Section 8.10 Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions hereof, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the REMIC I or property securing the same may at the time be located, the
Trustee shall have the power and shall execute and deliver all instruments to
appoint one or more Persons approved by the Trustee to act as co-trustee or
co-trustees, jointly with the Trustee, or separate trustee or separate trustees,
of all or any part of REMIC I, and to vest in such Person or Persons, in such
capacity, and for the benefit of the Holders of the Certificates, such title to
REMIC I, or any part thereof, and, subject to the other provisions of this
Section 8.10, such powers, duties, obligations, rights and trusts as the Trustee
may consider necessary or desirable. No co-trustee or separate trustee hereunder
shall be required to meet the terms of eligibility as a successor trustee under
Section 8.6 hereunder and no notice to Holders of
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Certificates of the appointment of co-trustee(s) or separate trustee(s) shall be
required under Section 8.8 hereof.
In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 8.10 all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly, except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed by the Trustee (whether as
Trustee hereunder or as successor to a defaulting Master Servicer hereunder),
the Trustee shall be incompetent or unqualified to perform such act or acts, in
which event such rights, powers, duties and obligations (including the holding
of title to REMIC I or any portion thereof in any such jurisdiction) shall be
exercised and performed by such separate trustee or co-trustee at the direction
of the Trustee.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article VIII. Each separate trustee and co-trustee, upon its acceptance
of the trust conferred, shall be vested with the estates or property specified
in its instrument of appointment, either jointly with the Trustee, or
separately, as may be provided therein, subject to all the provisions of this
Agreement, specifically including every provision of this Agreement relating to
the conduct of, affecting the liability of, or affording protection to, the
Trustee. Every such instrument shall be filed with the Trustee.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee or co-trustee.
Section 8.11 Appointment of Office or Agency.
The Trustee will appoint an office or agency in the City of New York
located at 00 Xxxxx Xxxxxx, Xxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, where the
Certificates may be surrendered for registration of transfer or exchange, and
presented for final distribution and where notices and demands to or upon the
Trustee in respect of the Certificates and this Agreement may be served.
Section 8.12 Representations and Warranties.
The Trustee hereby represents and warrants to the Master Servicer, the
Securities Administrator and the Depositor as applicable, as of the Closing
Date, that:
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(i) It is a national banking association duly organized,
validly existing and in good standing under the laws of the United
States of America.
(ii) The execution and delivery of this Agreement by it, and
the performance and compliance with the terms of this Agreement by it,
will not violate its articles of association or bylaws or constitute a
default (or an event which, with notice or lapse of time, or both,
would constitute a default) under, or result in the breach of, any
material agreement or other instrument to which it is a party or which
is applicable to it or any of its assets.
(iii) It has the full power and authority to enter into and
consummate all transactions contemplated by this Agreement, has duly
authorized the execution, delivery and performance of this Agreement,
and has duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by the other parties hereto, constitutes a valid, legal and
binding obligation of it, enforceable against it in accordance with the
terms hereof, subject to (A) applicable bankruptcy, insolvency,
receivership, reorganization, moratorium and other laws affecting the
enforcement of creditors' rights generally, and (B) general principles
of equity, regardless of whether such enforcement is considered in a
proceeding in equity or at law.
(v) It is not in violation of, and its execution and delivery
of this Agreement and its performance and compliance with the terms of
this Agreement will not constitute a violation of, any law, any order
or decree of any court or arbiter, or any order, regulation or demand
of any federal, state or local governmental or regulatory authority,
which violation, in its good faith and reasonable judgment, is likely
to affect materially and adversely either the ability of it to perform
its obligations under this Agreement or its financial condition.
(vi) No litigation is pending or, to the best of its
knowledge, threatened against it, which would prohibit it from entering
into this Agreement or, in its good faith reasonable judgment, is
likely to materially and adversely affect either the ability of it to
perform its obligations under this Agreement or its financial
condition.
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ARTICLE IX
TERMINATION
Section 9.1 Termination Upon Purchase or Liquidation of All Loans.
(a) Subject to Section 9.2, the respective obligations and
responsibilities under this Agreement of the Depositor, the Master Servicer and
the Trustee (other than the obligations of the Master Servicer to the Trustee
pursuant to Section 8.5 and of the Master Servicer to make remittances to the
Trustee and the Trustee to make payments in respect of the REMIC I Regular
Interests or the Classes of Certificates as hereinafter set forth) shall
terminate upon payment to the Certificateholders and the deposit of all amounts
held by or on behalf of the Trustee and required hereunder to be so paid or
deposited on the Distribution Date coinciding with or following the earlier to
occur of (i) the purchase by the Terminator (as defined below) of all Loans and
each REO Property remaining in REMIC I and (ii) the final payment or other
liquidation (or any advance with respect thereto) of the last Loan or REO
Property remaining in REMIC I; provided, however, that in no event shall the
trust created hereby continue beyond the expiration of 21 years from the death
of the last survivor of the descendants of Xxxxxx X. Xxxxxxx, the late
ambassador of the United States to the Court of St. Xxxxx, living on the date
hereof. The purchase by the Terminator of all Loans and each REO Property
remaining in REMIC I shall be at a price (the "Termination Price") equal to the
sum of (i) the aggregate Purchase Price of all the Loans included in REMIC I,
plus the fair market value of each REO Property, if any, included in REMIC I,
such valuation to be conducted by an appraiser mutually agreed upon by the
Terminator and the Trustee in their reasonable discretion plus (ii) any amounts
due the Servicers and the Master Servicer in respect of unpaid Servicing Fees,
Master Servicing Fees and outstanding Advances and Servicing Advances.
(b) The Master Servicer shall have the right (the party exercising such
right, the "Terminator"), to purchase all of the Loans and each REO Property
remaining in REMIC I pursuant to clause (i) of the preceding paragraph no later
than the Determination Date in the month immediately preceding the Distribution
Date on which the Certificates will be retired; provided, however, that the
Terminator may elect to purchase all of the Loans and each REO Property
remaining in REMIC I pursuant to clause (i) above only if the aggregate
Scheduled Principal Balance of the Loans and each REO Property remaining in the
Trust Fund at the time of such election is reduced to less than 10% of the
aggregate Scheduled Principal Balance of the Loans as of the Cut-off Date.
(c) Notice of the liquidation of the Certificates shall be given
promptly by the Trustee by letter to the Certificateholders mailed (a) in the
event such notice is given in connection with the purchase of the Loans and each
REO Property by the Terminator, not earlier than the 15th day and not later than
the 25th day of the month next preceding the month of the final distribution on
the Certificates or (b) otherwise during the month of such final distribution on
or before the Determination Date in such month, in each case specifying (i) the
Distribution Date upon which the Trust Fund will terminate and the final payment
in respect of the REMIC I Regular Interests or the
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Certificates will be made upon presentation and surrender of the related
Certificates at the office of the Trustee therein designated, (ii) the amount of
any such final payment, (iii) that no interest shall accrue in respect of the
REMIC I Regular Interests or Certificates from and after the Interest Accrual
Period relating to the final Distribution Date therefor and (iv) that the Record
Date otherwise applicable to such Distribution Date is not applicable, payments
being made only upon presentation and surrender of the Certificates at the
office of the Trustee. In the event such notice is given in connection with the
purchase of all of the Loans and each REO Property remaining in REMIC I by the
Terminator, the Terminator shall deliver to the Trustee for deposit in the
Distribution Account not later than the last Business Day of the month next
preceding the month of the final distribution on the Certificates an amount in
immediately available funds equal to the above-described Termination Price. The
Trustee shall remit (a) to the Master Servicer from such funds deposited in the
Distribution Account (i) any amounts which the Master Servicer notifies it in
writing that the Master Servicer would be permitted to withdraw and retain from
the Master Servicer Collection Account pursuant to Sections 3.24 and 3.26 and
(ii) any other amounts otherwise payable by the Trustee to the Master Servicer
from amounts on deposit in the Distribution Account pursuant to the terms of
this Agreement and notified by the Master Servicer in writing and (b) to the
Servicers, any amounts reimbursable to the Servicers pursuant to the Servicing
Agreements, in each case prior to making any final distributions pursuant to
Section 10.1(d) below. Upon certification to the Trustee by a Servicing Officer
of the making of such final deposit, the Trustee shall promptly release to the
Terminator the Mortgage Files for the remaining Loans, and the Trustee shall
execute all assignments, endorsements and other instruments necessary to
effectuate such transfer in each case without recourse, representation or
warranty.
(d) Upon presentation of the Certificates by the Certificateholders on
the final Distribution Date, the Trustee shall distribute to each
Certificateholder so presenting and surrendering its Certificates the amount
otherwise distributable on such Distribution Date in accordance with Section 4.1
in respect of the Certificates so presented and surrendered. Any funds not
distributed to any Holder or Holders of Certificates being retired on such
Distribution Date because of the failure of such Holder or Holders to tender
their Certificates shall, on such date, be set aside and held in trust and
credited to the account of the appropriate non-tendering Holder or Holders. If
any Certificates as to which notice has been given pursuant to this Section 9.1
shall not have been surrendered for cancellation within six months after the
time specified in such notice, the Trustee shall mail a second notice to the
remaining non-tendering Certificateholders to surrender their Certificates for
cancellation in order to receive the final distribution with respect thereto. If
within one year after the second notice all such Certificates shall not have
been surrendered for cancellation, the Trustee shall, directly or through an
agent, mail a final notice to the remaining non-tendering Certificateholders
concerning surrender of their Certificates. The costs and expenses of
maintaining the funds in trust and of contacting such Certificateholders shall
be paid out of the assets remaining in the trust funds. If within one year after
the final notice any such Certificates shall not have been surrendered for
cancellation, the Trustee shall pay to the Depositor all such amounts, and all
rights of non-tendering Certificateholders in or to such amounts shall thereupon
cease. No interest shall accrue or be payable to any Certificateholder on any
amount held in trust by the Trustee as a result of such Certificateholder's
failure to surrender its Certificate(s) for final payment thereof
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in accordance with this Section 9.1. Any such amounts held in trust by the
Trustee shall be held in an Eligible Account and the Trustee may direct any
depository institution maintaining such account to invest the funds in one or
more Eligible Investments. All income and gain realized from the investment of
funds deposited in such accounts held in trust by the Trustee shall be for the
benefit of the Trustee; provided, however, that the Trustee shall deposit in
such account the amount of any loss of principal incurred in respect of any such
Eligible Investment made with funds in such accounts immediately upon the
realization of such loss.
Immediately following the deposit of funds in trust hereunder
in respect of the Certificates, the Trust Fund shall terminate.
Section 9.2 Additional Termination Requirements.
(a) In the event that the Terminator purchases all the Loans and each
REO Property or the final payment on or other liquidation of the last Loan or
REO Property remaining in REMIC I pursuant to Section 9.1, the Trust Fund shall
be terminated in accordance with the following additional requirements:
(i) The Trustee shall specify the first day in the 90-day
liquidation period in a statement attached to each Trust REMIC's final
Tax Return pursuant to Treasury regulation Section 1.860F-1 and shall
satisfy all requirements of a qualified liquidation under Section 860F
of the Code and any regulations thereunder, as evidenced by an Opinion
of Counsel obtained by and at the expense of the Terminator;
(ii) During such 90-day liquidation period and, at or prior to
the time of making of the final payment on the Certificates, the
Trustee shall sell all of the assets of REMIC I to the Terminator for
cash; and
(iii) At the time of the making of the final payment on the
Certificates, the Trustee shall distribute or credit, or cause to be
distributed or credited, to the Holders of the Residual Certificates
all cash on hand in the Trust Fund (other than cash retained to meet
claims), and the Trust Fund shall terminate at that time.
(b) At the expense of the requesting Terminator (or, if the Trust Fund
is being terminated as a result of the occurrence of the event described in
clause (ii) of the first paragraph of Section 9.1, at the expense of the Trust
Fund), the Terminator shall prepare or cause to be prepared the documentation
required in connection with the adoption of a plan of liquidation of each Trust
REMIC pursuant to this Section 9.2.
(c) By their acceptance of Certificates, the Holders thereof hereby
agree to authorize the Trustee to specify the 90-day liquidation period for each
Trust REMIC, which authorization shall be binding upon all successor
Certificateholders.
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ARTICLE X
REMIC PROVISIONS
Section 10.1 REMIC Administration.
(a) The Trustee shall elect to treat each Trust REMIC under the Code
and, if necessary, under applicable state law and as instructed by the
Securities Administrator. Each such election will be made by the Securities
Administrator on Form 1066 or other appropriate federal tax or information
return or any appropriate state return for the taxable year ending on the last
day of the calendar year in which the Certificates are issued. For the purposes
of the REMIC election in respect of REMIC I, the REMIC I Regular Interests shall
be designated as the Regular Interests in REMIC I and the Class R-I Interest
shall be designated as the Residual Interests in REMIC I. The Certificates shall
be designated as the Regular Interests in REMIC II and the Class R-II Interest
shall be designated as the Residual Interests in REMIC II. The Trustee shall not
permit the creation of any "interests" in each Trust REMIC (within the meaning
of Section 860G of the Code) other than the REMIC I Regular Interests and the
interests represented by the Certificates.
(b) The Closing Date is hereby designated as the "Startup Day" of each
Trust REMIC within the meaning of Section 860G(a)(9) of the Code.
(c) The Securities Administrator shall be reimbursed for any and all
expenses relating to any tax audit of the Trust Fund (including, but not limited
to, any professional fees or any administrative or judicial proceedings with
respect to each Trust REMIC that involve the Internal Revenue Service or state
tax authorities), including the expense of obtaining any tax related Opinion of
Counsel except as specified herein. The Securities Administrator, as agent for
each Trust REMIC's tax matters person shall (i) act on behalf of the Trust Fund
in relation to any tax matter or controversy involving any Trust REMIC and (ii)
represent the Trust Fund in any administrative or judicial proceeding relating
to an examination or audit by any governmental taxing authority with respect
thereto. The holder of the largest Percentage Interest of each class of Residual
Certificates shall be designated, in the manner provided under Treasury
regulations section 1.860F-4(d) and Treasury regulations section
301.6231(a)(7)-1, as the tax matters person of the related REMIC created
hereunder. By their acceptance thereof, the holder of the largest Percentage
Interest of the Residual Certificates hereby agrees to irrevocably appoint the
Securities Administrator or an Affiliate as its agent to perform all of the
duties of the tax matters person for the Trust Fund.
(d) The Securities Administrator shall prepare and file and the Trustee
shall sign all of the Tax Returns in respect of each REMIC created hereunder.
The expenses of preparing and filing such returns shall be borne by the
Securities Administrator without any right of reimbursement therefor.
(e) The Securities Administrator shall perform on behalf of each Trust
REMIC all reporting and other tax compliance duties that are the responsibility
of such REMIC under the Code,
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the REMIC Provisions or other compliance guidance issued by the Internal Revenue
Service or any state or local taxing authority. Among its other duties, as
required by the Code, the REMIC Provisions or other such compliance guidance,
the Securities Administrator shall provide (i) to any Transferor of a Residual
Certificate such information as is necessary for the application of any tax
relating to the transfer of a Residual Certificate to any Person who is not a
Permitted Transferee upon receipt of additional reasonable compensation, (ii) to
the Certificateholders such information or reports as are required by the Code
or the REMIC Provisions including reports relating to interest, original issue
discount and market discount or premium (using the Prepayment Assumption as
required) and (iii) to the Internal Revenue Service the name, title, address and
telephone number of the person who will serve as the representative of each
Trust REMIC. The Depositor shall provide or cause to be provided to the
Securities Administrator, within ten (10) days after the Closing Date, all
information or data that the Securities Administrator reasonably determines to
be relevant for tax purposes as to the valuations and issue prices of the
Certificates, including, without limitation, the price, yield, prepayment
assumption and projected cash flow of the Certificates.
(f) To the extent in the control of the Trustee or the Securities
Administrator, each such Person (i) shall take such action and shall cause each
REMIC created hereunder to take such action as shall be necessary to create or
maintain the status thereof as a REMIC under the REMIC Provisions, (ii) shall
not take any action, cause the Trust Fund to take any action or fail to take (or
fail to cause to be taken) any action that, under the REMIC Provisions, if taken
or not taken, as the case may be, could (A) endanger the status of each Trust
REMIC as a REMIC or (B) result in the imposition of a tax upon the Trust Fund
(including but not limited to the tax on prohibited transactions as defined in
Section 860F(a)(2) of the Code and the tax on contributions to a REMIC set forth
in Section 860G(d) of the Code) (either such event, an "Adverse REMIC Event")
unless such action or inaction is permitted under this Agreement or the Trustee
and the Securities Administrator have received an Opinion of Counsel, addressed
to them (at the expense of the party seeking to take such action but in no event
at the expense of the Trustee or the Securities Administrator) to the effect
that the contemplated action will not, with respect to any Trust REMIC, endanger
such status or result in the imposition of such a tax, nor (iii) shall the
Securities Administrator take or fail to take any action (whether or not
authorized hereunder) as to which the Trustee has advised it in writing that it
has received an Opinion of Counsel to the effect that an Adverse REMIC Event
could occur with respect to such action; provided that the Securities
Administrator may conclusively rely on such Opinion of Counsel and shall incur
no liability for its action or failure to act in accordance with such Opinion of
Counsel. In addition, prior to taking any action with respect to any Trust REMIC
or the respective assets of each, or causing any Trust REMIC to take any action,
which is not contemplated under the terms of this Agreement, the Securities
Administrator will consult with the Trustee or its designee, in writing, with
respect to whether such action could cause an Adverse REMIC Event to occur with
respect to any Trust REMIC, and the Securities Administrator shall not take any
such action or cause any Trust REMIC to take any such action as to which the
Trustee has advised it in writing that an Adverse REMIC Event could occur. The
Trustee may consult with counsel to make such written advice, and the cost of
same shall be borne by the party seeking to take the action not permitted by
this Agreement, but in no event shall such cost be an expense of the Trustee.
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(g) In the event that any tax is imposed on "prohibited transactions"
of any REMIC created hereunder as defined in Section 860F(a)(2) of the Code, on
the "net income from foreclosure property" of such REMIC as defined in Section
860G(c) of the Code, on any contributions to any such REMIC after the Startup
Day therefor pursuant to Section 860G(d) of the Code, or any other tax is
imposed by the Code or any applicable provisions of state or local tax laws,
such tax shall be charged (i) to the Trustee pursuant to Section 10.3 hereof, if
such tax arises out of or results from a breach by the Trustee of any of its
obligations under this Article X, (ii) to the Securities Administrator pursuant
to Section 10.3 hereof, if such tax arises out of or results from a breach by
the Securities Administrator of any of its obligations under this Article X,
(iii) to the Master Servicer pursuant to Section 10.3 hereof, if such tax arises
out of or results from a breach by the Master Servicer of any of its obligations
under Article III or under this Article X, or (iv) against amounts on deposit in
the Distribution Account and shall be paid by withdrawal therefrom.
(h) The Trustee and the Securities Administrator shall, for federal
income tax purposes, maintain books and records with respect to each Trust REMIC
on a calendar year and on an accrual basis.
(i) Following the Startup Day, the Trustee shall not accept any
contributions of assets to any Trust REMIC other than in connection with any
Substitute Loan delivered in accordance with Section 2.3 unless it shall have
received an Opinion of Counsel addressed to it to the effect that the inclusion
of such assets in the Trust Fund will not cause the related REMIC to fail to
qualify as a REMIC at any time that any Certificates are outstanding or subject
such REMIC to any tax under the REMIC Provisions or other applicable provisions
of federal, state and local law or ordinances.
(j) Neither the Trustee nor the Securities Administrator shall
knowingly enter into any arrangement by which any Trust REMIC will receive a fee
or other compensation for services nor permit either REMIC to receive any income
from assets other than "qualified mortgages" as defined in Section 860G(a)(3) of
the Code or "permitted investments" as defined in Section 860G(a)(5) of the
Code.
(k) The Securities Administrator shall apply for an employer
identification number with the Internal Revenue Service via a Form SS-4 or other
comparable method for each REMIC. In connection with the foregoing, the
Securities Administrator shall provide the name and address of the person who
can be contacted to obtain information required to be reported to the holders of
Regular Interests in each REMIC as required by IRS Form 8811.
Section 10.2 Prohibited Transactions and Activities.
None of the Depositor, the Securities Administrator, the Master
Servicer or the Trustee shall sell, dispose of or substitute for any of the
Loans (except in connection with (i) the foreclosure of a Loan, including but
not limited to, the acquisition or sale of a Mortgaged Property acquired by deed
in lieu of foreclosure, (ii) the bankruptcy of REMIC I, (iii) the termination of
REMIC I pursuant to
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Article IX of this Agreement, (iv) a substitution pursuant to Article II of this
Agreement or (v) a purchase of Loans pursuant to Article II of this Agreement),
nor acquire any assets for any Trust REMIC (other than REO Property acquired in
respect of a defaulted Loan), nor sell or dispose of any investments in the
Master Servicer Collection Account or the Distribution Account for gain, nor
accept any contributions to any Trust REMIC after the Closing Date (other than a
Substitute Loan delivered in accordance with Section 2.3), unless it has
received an Opinion of Counsel, addressed to the Trustee and the Trustee (at the
expense of the party seeking to cause such sale, disposition, substitution,
acquisition or contribution but in no event at the expense of the Trustee) that
such sale, disposition, substitution, acquisition or contribution will not (a)
affect adversely the status of any Trust REMIC as a REMIC or (b) cause any Trust
REMIC to be subject to a tax on "prohibited transactions" or "contributions"
pursuant to the REMIC Provisions.
Section 10.3 Indemnification.
(a) The Trustee agrees to be liable for any taxes and costs incurred by
the Trust Fund, the Depositor, the Securities Administrator or the Master
Servicer including, without limitation, any reasonable attorneys fees imposed on
or incurred by the Trust Fund, the Depositor, the Securities Administrator or
the Master Servicer as a result of the Trustee's failure to perform its
covenants set forth in this Article X in accordance with the standard of care of
the Trustee set forth in this Agreement.
(b) The Master Servicer agrees to indemnify the Trust Fund, the
Depositor and the Trustee for any taxes and costs including, without limitation,
any reasonable attorneys' fees imposed on or incurred by the Trust Fund, the
Depositor or the Trustee, as a result of the Master Servicer's failure to
perform its covenants set forth in Article III in accordance with the standard
of care of the Master Servicer set forth in this Agreement.
(c) The Securities Administrator agrees to be liable for any taxes and
costs incurred by the Trust Fund, the Depositor or the Trustee including,
without limitation, any reasonable attorneys fees imposed on or incurred by the
Trust Fund, the Depositor or the Trustee as a result of the Securities
Administrator's failure to perform its covenants set forth in this Article X in
accordance with the standard of care of the Securities Administrator set forth
in this Agreement.
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ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.1 Amendment. This Agreement may be amended from time to time
by the Depositor, the Master Servicer, the Securities Administrator and the
Trustee, without the consent of any of the Certificateholders, (a) to cure any
ambiguity, to correct or supplement any provision herein which may be
inconsistent with any other provision herein, or to make any other provisions
with respect to matters or questions arising under this Agreement, (b) to
modify, eliminate or add to any provisions to such extent as shall be necessary
to maintain the qualification of the Trust Fund as two REMICs at all times that
any Class A or Subordinate Certificates are outstanding, provided, that such
action shall not, as evidenced by an Opinion of Counsel addressed to the Trustee
and delivered to the Trustee, adversely affect in any material respect the
interests of any Certificateholder. No amendment shall be deemed to adversely
affect in any material respect the interests of any Certificateholder who shall
have consented thereto, and no Opinion of Counsel shall be required to address
the effect of any such amendment on any such consenting Certificateholder.
This Agreement may also be amended from time to time by the Depositor,
the Master Servicer, the Securities Administrator and the Trustee with the
consent of the Holders of Certificates evidencing, in aggregate, not less than
66-2/3% of the Trust Fund for the purpose of adding any provisions or changing
in any manner or eliminating any of the provisions of this Agreement or of
modifying in any manner the rights of the Holders of Certificates; provided,
however, that no such amendment shall (a) reduce in any manner the amount of, or
delay the timing of, payments received on Loans which are required to be
distributed in respect of any Certificate without the consent of the Holder of
such Certificate; (b) adversely affect in any material respect the interest of
the Holders of the Class A Certificates in a manner other than as described in
(a) above without the consent of the Holders of Class A Certificates aggregating
not less than 66-2/3% of the aggregate Percentage Interest evidenced by all
Class A Certificates; (c) adversely affect in any material respect the interest
of the Holders of the Subordinate Certificates in a manner other than as
described in clause (a) above without the consent of the Holders of Subordinate
Certificates aggregating not less than 66-2/3% of the aggregate Percentage
Interest evidenced by all Subordinate Certificates; (d) adversely affect in any
material respect the interest of the Class R Certificateholder without the
consent of the Holder of the Class R Certificate; (e) change in any material
respect the rights and obligations of the Master Servicer or successor Master
Servicer under this Agreement without the prior written consent of such party;
or (f) reduce the aforesaid percentage of the Certificates the Holders of which
are required to consent to any such amendments without the consent of the
Holders of all Certificates then outstanding; provided, that for the purposes of
this Agreement, the Holder of the Class R Certificate shall have no right to
vote at all times that any Class A Certificates or Subordinate Certificates are
outstanding if such amendment relates to the modification, elimination or
addition of any provision necessary to maintain the qualification of the Trust
Fund as two REMICs. Without limiting the generality of the foregoing, any
amendment to this Agreement required in connection with the compliance with or
the clarification of any reporting obligations described in Section 3.18 hereof
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shall not require the consent of any Certificateholder or any Opinion of Counsel
or Rating Agency confirmation.
Notwithstanding any contrary provision of this Agreement, the Trustee
shall not consent to any amendment to this Agreement unless it shall have first
received an Opinion of Counsel addressed to it to the effect that such amendment
will not cause either REMIC I or REMIC II of the Trust Fund to fail to qualify
as a REMIC at any time that any REMIC I Regular Interests or REMIC II
Certificates are outstanding.
As soon as practicable after the execution of any such amendment, the
Trustee shall furnish written notification of the substance of such amendment to
each Certificateholder and Rating Agency.
It shall not be necessary for the consent of the Certificateholders
under this Section 11.1 to approve the particular form of any proposed
amendment, but it shall be sufficient if such consent shall approve the
substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Certificateholders shall be subject to
such reasonable regulations as the Trustee may prescribe.
Prior to the execution of any amendment to this Agreement, the Trustee
shall be entitled to receive and rely upon an Opinion of Counsel addressed to it
stating that the execution of such amendment is authorized or permitted by this
Agreement. The Trustee may, but shall not be obligated to, enter into any such
amendment which affects the Trustee's own rights, duties or immunities under
this Agreement.
Section 11.2 Recordation of Agreement; Counterparts. To the extent
permitted by applicable law, this Agreement (or an abstract hereof, if
acceptable by the applicable recording office) is subject to recordation in all
appropriate public offices for real property records in all the counties or
other comparable jurisdictions in which any or all of the properties subject to
the Mortgages are situated, and in any other appropriate public recording office
or elsewhere, such recordation to be effected by the Depositor at the expense of
the Certificateholders, but only after the Depositor has delivered to the
Trustee an Opinion of Counsel to the effect that such recordation materially and
beneficially affects the interests of the Certificateholders.
For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
Section 11.3 Limitation on Rights of Certificateholders. The death or
incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust Fund, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or take any action or
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proceeding in any court for a partition or winding up of the Trust Fund, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
Except as otherwise expressly provided herein no Certificateholder,
solely by virtue of its status as Certificateholder, shall have any right to
vote or in any manner otherwise control the operation and management of the
Trust Fund, or the obligations of the parties hereto, nor shall anything herein
set forth, or contained in the terms of the Certificates, be construed so as to
constitute the Certificateholders from time to time as partners or members of an
association, nor shall any Certificateholder be under any liability to any third
person by reason of any action taken by the parties to this Agreement pursuant
to any provision hereof.
No Certificateholder, solely by virtue of its status as
Certificateholder, shall have any right by virtue or by availing of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
holder previously shall have given to the Trustee a written notice of default
and of the continuance thereof, as hereinbefore provided, and unless all of the
Holders of Certificates evidencing, in aggregate, not less than 25% of the Trust
Fund shall have made written request upon the Trustee to institute such action,
suit or proceeding in its own name as Trustee hereunder and shall have offered
to the Trustee such reasonable indemnity as it may require against the costs,
expenses and liabilities to be incurred therein or thereby, and the Trustee, for
60 days after its receipt of such notice, request and offer of indemnity, shall
have neglected or refused to institute any such action, suit or proceeding; it
being understood and intended, and being expressly covenanted by each
Certificateholder with every other Certificateholder and the Trustee, that no
one or more holders of Certificates shall have any right in any manner whatever
by virtue or by availing of any provision of this Agreement to affect, disturb
or prejudice the rights of the Holders of any other of such Certificates, or to
obtain or seek to obtain priority over or preference to any other such Holder,
or to enforce any right under this Agreement, except in the manner herein
provided and for the benefit of all Certificateholders. For the protection and
enforcement of the provisions of this Section 11.3, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
Section 11.4 Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 11.5 Notices. All demands, notices and communications hereunder
shall be in writing and shall be deemed to have been duly given if personally
delivered at or mailed by certified or registered mail, return receipt requested
(a) in the case of the Depositor, to 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx,
Attention: Deutsche Mortgage Securities, Inc., Mortgage Loan Trust, Series
2002-1, (telecopy number:(000) 000-0000), or such other address or telecopy
number as may hereafter be furnished to the Master Servicer and the Trustee in
writing by the Depositor, (b) in the case of the Master Servicer and the
Securities Administrator, X.X. Xxx 00, Xxxxxxxx, Xxxxxxxx
000
00000 and for overnight delivery to 0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx
00000, Attention: Deutsche Mortgage Securities, Inc., 2002-1 (telecopy number:
(000) 000-0000), or such other address or telecopy number as may hereafter be
furnished to the Trustee and the Depositor in writing by the Master Servicer or
the Securities Administrator, and (c) in the case of the Trustee, at the
Corporate Trust Office or such other address or telecopy number as the Trustee
may hereafter be furnish to the Master Servicer and the Depositor in writing by
the Trustee. Any notice required or permitted to be given to a Certificateholder
shall be given by first class mail, postage prepaid, at the address of such
Holder as shown in the Certificate Register. Any notice so mailed within the
time prescribed in this Agreement shall be conclusively presumed to have been
duly given when mailed, whether or not the Certificateholder receives such
notice. A copy of any notice required to be telecopied hereunder also shall be
mailed to the appropriate party in the manner set forth above.
Section 11.6 Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and shall
in no way affect the validity or enforceability of the other provisions of this
Agreement or of the Certificates or the rights of the Holders thereof.
Section 11.7 Notice to Rating Agencies.
The Trustee shall use its best efforts promptly to provide notice to
the Rating Agencies with respect to each of the following of which it has actual
knowledge:
1. Any material change or amendment to this Agreement;
2. The occurrence of any Master Servicer Event of Default
that has not been cured or waived;
3. The resignation or termination of the Master Servicer
or the Trustee;
4. The repurchase or substitution of Loans pursuant to or
as contemplated by Section 2.3;
5. The final payment to the Holders of any Class of
Certificates;
6. Any change in the location of the Master Servicer
Collection Account or the Distribution Account; and
7. Any event that would result in the inability of the
Trustee to make advances regarding delinquent Loans
pursuant to Section 7.2.
107
The Master Servicer shall make available to each Rating Agency
copies of the following:
1. Each annual statement as to compliance described in
Section 3.16; and
2. Each annual independent public accountants' servicing
report described in Section 3.17.
Any such notice pursuant to this Section 11.7 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 Standard & Poor's, a division of the XxXxxx-Xxxx Companies, Inc., 00 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 and to Fitch Ratings, 0 Xxxxx Xxxxxx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000 or such other addresses as the Rating Agencies may
designate in writing to the parties hereto.
Section 11.8 Article and Section References.
All article and section references used in this Agreement, unless
otherwise provided, are to articles and sections in this Agreement.
Section 11.9 Grant of Security Interest.
It is the express intent of the parties hereto that the conveyance of
the Loans by the Depositor to the Trustee, on behalf of the Trust and for the
benefit of the Certificateholders, be, and be construed as, a sale of the Loans
by the Depositor and not a pledge of the Loans to secure a debt or other
obligation of the Depositor. However, in the event that, notwithstanding the
aforementioned intent of the parties, the Loans are held to be property of the
Depositor, then, (a) it is the express intent of the parties that such
conveyance be deemed a pledge of the Loans by the Depositor to the Trustee, on
behalf of the Trust and for the benefit of the Certificateholders, to secure a
debt or other obligation of the Depositor and (b)(1) this Agreement shall also
be deemed to be a security agreement within the meaning of Articles 8 and 9 of
the Uniform Commercial Code as in effect from time to time in the State of New
York; (2) the conveyance provided for in Section 2.1 hereof shall be deemed to
be a grant by the Depositor to the Trustee, on behalf of the Trust and for the
benefit of the Certificateholders, of a security interest in all of the
Depositor's right, title and interest in and to the Loans and all amounts
payable to the holders of the Loans in accordance with the terms thereof and all
proceeds of the conversion, voluntary or involuntary, of the foregoing into
cash, instruments, securities or other property, including without limitation
all amounts, other than investment earnings, from time to time held or invested
in the Master Servicer Collection Account and the Distribution Account, whether
in the form of cash, instruments, securities or other property; (3) the
obligations secured by such security agreement shall be deemed to be all of the
Depositor's obligations under this Agreement, including the obligation to
provide to the Certificateholders the benefits of this Agreement relating to the
Loans and the Trust Fund; and (4) notifications to persons holding such
property, and acknowledgments, receipts or confirmations from persons holding
such property, shall
108
be deemed notifications to, or acknowledgments, receipts or confirmations from,
financial intermediaries, bailees or agents (as applicable) of the Trustee for
the purpose of perfecting such security interest under applicable law.
Accordingly, the Depositor hereby grants to the Trustee, on behalf of the Trust
and for the benefit of the Certificateholders, a security interest in the Loans
and all other property described in clause (2) of the preceding sentence, for
the purpose of securing to the Trustee the performance by the Depositor of the
obligations described in clause (3) of the preceding sentence. Notwithstanding
the foregoing, the parties hereto intend the conveyance pursuant to Section 2.1
to be a true, absolute and unconditional sale of the Loans and assets
constituting the Trust Fund by the Depositor to the Trustee, on behalf of the
Trust and for the benefit of the Certificateholders.
Section 11.10 Third Party Beneficiaries.
For purposes of Sections 2.5, 3.1, 3.5, 3.7, 3.15(c), 3.18, 3.22, 3.26
and 6.3, the Servicers shall be third party beneficiaries of this Agreement and
each Servicer shall have the right to enforce such provisions. Further, it is
understood and agreed that the obligations of the Servicers are set forth in
their entirety in the related Servicing Agreement and the Servicers are not
bound by the terms hereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
109
IN WITNESS WHEREOF, the Depositor, the Master Servicer, the Securities
Administrator and the Trustee have caused their names to be signed hereto by
their respective officers thereunto duly authorized, all as of the day and year
first above written.
DEUTSCHE MORTGAGE SECURITIES, INC., as
Depositor
By /s/ Xxxxxx Xxxx
---------------------------------------------
Name: Xxxxxx Xxxx
Its: Director
By /s/ Xxxxxxx Xxxxxxxxx
---------------------------------------------
Name: Xxxxxxx Xxxxxxxxx
Its:
XXXXX FARGO BANK MINNESOTA, NATIONAL
ASSOCIATION
as Master Servicer and Securities Administrator
By /s/ Xxxxx X. Xxxxxx
---------------------------------------------
Name: Xxxxx X. Xxxxxx
Its: Vice President
BANK ONE NATIONAL ASSOCIATION, not in its
individual capacity but solely as Trustee
By: /s/ Xxxx X. Xxxxx
---------------------------------------------
Name: Xxxx X. Xxxxx
Its: Vice President
110
STATE OF )
) ss.:
COUNTY OF )
On the ___ day of December 2002, before me, a notary public in and
for said State, personally appeared _____________________ known to me to be a
_____________________ of Deutsche Mortgage Securities, Inc ., one of the
corporations that executed the within instrument, and also known to me to be the
person who executed it on behalf of said corporation, and acknowledged to me
that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
------------------------------
Notary Public
[Notarial Seal]
111
STATE OF )
) ss.:
COUNTY OF )
On the ___ day of December 2002, before me, a notary public in
and for said State, personally appeared _____________________ known to me to be
a _____________________ of Deutsche Mortgage Securities, Inc ., one of the
corporations that executed the within instrument, and also known to me to be the
person who executed it on behalf of said corporation, and acknowledged to me
that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
------------------------------
Notary Public
[Notarial Seal]
112
STATE OF )
) ss.:
COUNTY OF )
On the __ day of December 2002, before me, a notary public in
and for said State, personally appeared ___________________________ known to me
to be a ____________________ of Xxxxx Fargo Bank Minnesota, National
Association, one of the corporations that executed the within instrument, and
also known to me to be the person who executed it on behalf of said corporation,
and acknowledged to me that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
------------------------------
Notary Public
[Notarial Seal]
113
STATE OF )
) ss.:
COUNTY OF )
On the ___ day of December, 2002, before me, a notary public
in and for said State, personally appeared _______________ known to me to be a
_______________ of Bank One, National Association, one of the corporations that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
------------------------------
Notary Public
[Notarial Seal]
114
EXHIBIT A
---------
FORMS OF CERTIFICATES
Exhibit A-1
CUSIP __________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-1
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 4.500% per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-1
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate: $
Class A-1 Remittance Rate: 4.500%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-1 Principal Balance as of the Cut-Off Date: $________________
Cede & Co.
----------
Registered Owner Certificate No.__
A-1-1
Exhibit A-2
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-2
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 4.500% per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-2
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________ Class
A-2 Remittance Rate:
4.500%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-2 Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No.
A-2-1
Exhibit A-3
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-3
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is variable.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-3
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________
Class A-3 Remittance Rate: variable
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-3 Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No.
A-3-1
Exhibit A-4
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-4
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is variable.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-4
Notional Amount as of the
Cut-Off Date evidenced by
this Certificate:
$_______________
Class A-4 Remittance Rate: variable
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-4 Notional Amount as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No.
A-4-1
Exhibit A-5
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-5
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.00% per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-5
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________
Class A-5 Remittance Rate: 6.00%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-5 Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No.
A-5-1
Exhibit A-6
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-6
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.00% per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-6
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________
Class A-6 Remittance Rate: 6.000%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-6 Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No.
A-6-1
Exhibit A-7
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-7
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 2.92% per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-7
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________
Class A-7 Remittance Rate: 6.000%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-7 Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No.
A-7-1
Exhibit A-8
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-8
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is variable.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-8
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________
Class A-8 Remittance Rate: variable
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-8 Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No.
A-8-1
Exhibit A-9
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-9
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is variable.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-9
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________
Class A-9 Remittance Rate: variable
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-9 Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No.
A-9-1
Exhibit A-10
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-10
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 5.500% per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-10
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________
Class A-10 Remittance Rate: 5.000%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-10 Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No.
A-10-1
Exhibit A-11
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-11
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 5.500% per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-11
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________
Class A-11 Remittance Rate: 5.550%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-11 Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No.
A-11-1
Exhibit A-12
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-12
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 5.750% per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-12
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________
Class A-12 Remittance Rate: 5.750%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-12 Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No.
A-12-1
Exhibit A-13
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-13
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 8.500% per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-13
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________
Class A-13 Remittance Rate: 8.500%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-13 Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No.
A-13-1
Exhibit A-14
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-14
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.000% per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-14
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________
Class A-14 Remittance Rate: 6.000%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-14 Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No.
A-14-1
Exhibit A-15
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-15
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.000% per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-15
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________
Class A-15 Remittance Rate: 6.000%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: May 15, 2021
Class A-15 Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No.
A-15-1
Exhibit A-16
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-16
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.000% per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-16
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________
Class A-16 Remittance Rate: 6.000%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-16 Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No.
A-16-1
Exhibit A-17
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-17
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.000% per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-17
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________
Class A-17 Remittance Rate: 6.000%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-17 Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No.
A-17-1
Exhibit A-18
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-18
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.000% per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-18
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________
Class A-18 Remittance Rate: 6.000%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-18 Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No.
A-18-1
Exhibit A-19
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-X
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.000% per annum.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-X
Notional Amount as of the
Cut-Off Date evidenced by
this Certificate:
$_______________
Class A-X Remittance Rate: 6.000%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-X Notional Amount as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No.
A-19-1
Exhibit A-20
CUSIP ________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-P
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. Interest is
not payable with respect to this Certificate.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Series 2002-1 Portion of the Class A-P
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________ Class
A-P Remittance Rate:
0.000%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class A-P Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner ertificate No.
A-20-1
Exhibit A-21
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class M
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended (the
"Code"). The issue date (the "Issue Date") of this Certificate is December 30,
2002. The rate at which interest is payable as of the Issue Date with respect to
this Certificate is 6.000% per annum.
IN THE CASE OF ANY CLASS M CERTIFICATE PRESENTED FOR REGISTRATION THE
TRANSFEREE OF SUCH CERTIFICATE SHALL PROVIDE AN OFFICER'S CERTIFICATE
SIGNED BY A RESPONSIBLE OFFICER OF SUCH TRANSFEREE STATING THAT SUCH
TRANSFEREE (I) IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA") OR A "PLAN"
DESCRIBED IN SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED
(THE "CODE") OR ANY ENTITY DEEMED TO HOLD PLAN ASSETS OF ANY OF THE
FOREGOING BY REASON OF A PLAN'S INVESTMENT IN SUCH ENTITY (A "PLAN"), OR
(II) EITHER (A) IT HAS ACQUIRED AND IS HOLDING SUCH CERTIFICATES IN
RELIANCE ON DEPARTMENT OF LABOR PROHIBITED TRANSACTION EXEMPTION 94-84 OR
FAN 97-03E, AS AMENDED, THAT IT UNDERSTANDS THAT THERE ARE CERTAIN
CONDITIONS TO THE AVAILABILITY OF THE EXEMPTIONS, INCLUDING THAT SUCH
CERTIFICATES ARE RATED AT THE TIME OF PURCHASE IN ONE OF THE TOP FOUR
RATING CATEGORIES BY AT LEAST ONE RATING AGENCY (AS DEFINED IN THE POOLING
AGREEMENT) OR (B) THE TRANSFEREE IS AN INSURANCE COMPANY USING ASSETS OF AN
"INSURANCE COMPANY GENERAL ACCOUNT" THAT IS ELIGIBLE FOR, AND SATISFIES ALL
OF THE REQUIREMENTS OF SECTIONS I AND III OF PROHIBITED TRANSACTION CLASS
EXEMPTION 95-60.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
A-21-1
The Class M Certificates will be subordinate in right of payment to and provide
credit support to certain Classes of Certificates, as described in the Pooling
Agreement.
Series 2002-1 Portion of the Class M
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________ Class M
Remittance Rate: 6.000%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class M Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner rtificate No. __
A-21-2
Exhibit A-22
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class B-1
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.000% per annum.
IN THE CASE OF ANY CLASS B-1 CERTIFICATE PRESENTED FOR REGISTRATION THE
TRANSFEREE OF SUCH CERTIFICATE SHALL PROVIDE AN OFFICER'S CERTIFICATE
SIGNED BY A RESPONSIBLE OFFICER OF SUCH TRANSFEREE STATING THAT SUCH
TRANSFEREE (I) IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA") OR A "PLAN"
DESCRIBED IN SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED
(THE "CODE") OR ANY ENTITY DEEMED TO HOLD PLAN ASSETS OF ANY OF THE
FOREGOING BY REASON OF A PLAN'S INVESTMENT IN SUCH ENTITY (A "PLAN"), OR
(II) EITHER (A) IT HAS ACQUIRED AND IS HOLDING SUCH CERTIFICATES IN
RELIANCE ON DEPARTMENT OF LABOR PROHIBITED TRANSACTION EXEMPTION 94-84 OR
FAN 97-03E, AS AMENDED, THAT IT UNDERSTANDS THAT THERE ARE CERTAIN
CONDITIONS TO THE AVAILABILITY OF THE EXEMPTIONS, INCLUDING THAT SUCH
CERTIFICATES ARE RATED AT THE TIME OF PURCHASE IN ONE OF THE TOP FOUR
RATING CATEGORIES BY AT LEAST ONE RATING AGENCY (AS DEFINED IN THE POOLING
AGREEMENT) OR (B) THE TRANSFEREE IS AN INSURANCE COMPANY USING ASSETS OF AN
"INSURANCE COMPANY GENERAL ACCOUNT" THAT IS ELIGIBLE FOR, AND SATISFIES ALL
OF THE REQUIREMENTS OF SECTIONS I AND III OF PROHIBITED TRANSACTION CLASS
EXEMPTION 95-60.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
The Class B-1 Certificates will be subordinate in right of payment to and
provide credit support to certain Classes of Certificates, as described in the
Pooling Agreement.
A-22-1
Series 2002-1 Portion of the Class B-1
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________ Class
B-1 Remittance Rate:
6.000%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class B-1 Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No. __
A-22-2
Exhibit A-23
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class B-2
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 30, 2002. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.000% per annum.
IN THE CASE OF ANY CLASS B-2 CERTIFICATE PRESENTED FOR REGISTRATION THE
TRANSFEREE OF SUCH CERTIFICATE SHALL PROVIDE AN OFFICER'S CERTIFICATE
SIGNED BY A RESPONSIBLE OFFICER OF SUCH TRANSFEREE STATING THAT SUCH
TRANSFEREE (I) IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA") OR A "PLAN"
DESCRIBED IN SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED
(THE "CODE") OR ANY ENTITY DEEMED TO HOLD PLAN ASSETS OF ANY OF THE
FOREGOING BY REASON OF A PLAN'S INVESTMENT IN SUCH ENTITY (A "PLAN"), OR
(II) EITHER (A) IT HAS ACQUIRED AND IS HOLDING SUCH CERTIFICATES IN
RELIANCE ON DEPARTMENT OF LABOR PROHIBITED TRANSACTION EXEMPTION 94-84 OR
FAN 97-03E, AS AMENDED, THAT IT UNDERSTANDS THAT THERE ARE CERTAIN
CONDITIONS TO THE AVAILABILITY OF THE EXEMPTIONS, INCLUDING THAT SUCH
CERTIFICATES ARE RATED AT THE TIME OF PURCHASE IN ONE OF THE TOP FOUR
RATING CATEGORIES BY AT LEAST ONE RATING AGENCY (AS DEFINED IN THE POOLING
AGREEMENT) OR (B) THE TRANSFEREE IS AN INSURANCE COMPANY USING ASSETS OF AN
"INSURANCE COMPANY GENERAL ACCOUNT" THAT IS ELIGIBLE FOR, AND SATISFIES ALL
OF THE REQUIREMENTS OF SECTIONS I AND III OF PROHIBITED TRANSACTION CLASS
EXEMPTION 95-60.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
A-23-1
The Class B-2 Certificates will be subordinate in right of payment to and
provide credit support to certain Classes of Certificates, as described in the
Pooling Agreement.
Series 2002-1 Portion of the Class B-2
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________ Class
B-2 Remittance Rate:
6.000%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class B-2 Principal Balance as of the Cut-Off Date: $_______________
Cede & Co.
----------
Registered Owner Certificate No. __
A-23-2
Exhibit A-24
CUSIP
MORTGAGE PASS-THROUGH CERTIFICATE
Class B-3
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended (the
"Code"). The issue date (the "Issue Date") of this Certificate is December 30,
2002. The rate at which interest is payable as of the Issue Date with respect to
this Certificate is 6.000% per annum.
IN THE CASE OF ANY CLASS B-3 CERTIFICATE PRESENTED FOR REGISTRATION IN THE
NAME OF AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR ANY "PLAN" DESCRIBED IN
SECTION 4975 OF THE CODE OR ANY ENTITY DEEMED TO HOLD PLAN ASSETS OF ANY OF
THE FOREGOING BY REASON OF A PLAN'S INTEREST IN SUCH ENTITY (A "PLAN"), A
TRUSTEE OF ANY SUCH PLAN, OR ANY OTHER PERSON WHO IS USING "PLAN ASSETS" OF
ANY SUCH PLAN TO EFFECT SUCH ACQUISITION, THE TRUSTEE SHALL REQUIRE SUCH
TRANSFEREE TO PROVIDE AN OFFICER'S CERTIFICATE SIGNED BY A RESPONSIBLE
OFFICER OF SUCH TRANSFEREE STATING THAT THE TRANSFEREE IS AN INSURANCE
COMPANY USING ASSETS OF AN "INSURANCE COMPANY GENERAL ACCOUNT" (WITHIN THE
MEANING OF DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION
("PTCE") 95-60) TO EFFECT SUCH PURCHASE AND SATISFIES ALL OF THE
REQUIREMENTS FOR EXEMPTIVE RELIEF UNDER SECTIONS I AND III OF PTCE 95-60,
WHICH OFFICER'S CERTIFICATE SHALL NOT BE AN EXPENSE OF THE TRUSTEE OR THE
DEPOSITOR.
The Class B-3 Certificates will be subordinate in right of payment to and
provide credit support to certain Classes of Certificates, as described in the
Pooling Agreement.
Series 2002-1 Portion of the Class B-3
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________
Class B-3 Remittance Rate: 6.000%
A-24-1
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class B-3 Principal Balance as of the Cut-Off Date: $_______________
Registered Owner Certificate No. __
A-24-2
Exhibit A-25
CUSIP__________
MORTGAGE PASS-THROUGH CERTIFICATE
Class B-4
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended (the
"Code"). The issue date (the "Issue Date") of this Certificate is December 30,
2002. The rate at which interest is payable as of the Issue Date with respect to
this Certificate is 6.000% per annum.
IN THE CASE OF ANY CLASS B-4 CERTIFICATE PRESENTED FOR REGISTRATION IN THE
NAME OF AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR ANY "PLAN" DESCRIBED IN
SECTION 4975 OF THE CODE OR ANY ENTITY DEEMED TO HOLD PLAN ASSETS OF ANY OF
THE FOREGOING BY REASON OF A PLAN'S INTEREST IN SUCH ENTITY (A "PLAN"), THE
TRUSTEE SHALL REQUIRE SUCH TRANSFEREE TO PROVIDE AN OFFICER'S CERTIFICATE
SIGNED BY A RESPONSIBLE OFFICER OF SUCH TRANSFEREE STATING THAT THE
TRANSFEREE IS AN INSURANCE COMPANY USING ASSETS OF AN "INSURANCE COMPANY
GENERAL ACCOUNT" (WITHIN THE MEANING OF DEPARTMENT OF LABOR PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60) TO EFFECT SUCH PURCHASE AND
SATISFIES ALL OF THE REQUIREMENTS FOR EXEMPTIVE RELIEF UNDER SECTIONS I AND
III OF PTCE 95-60, WHICH OFFICER'S CERTIFICATE SHALL NOT BE AN EXPENSE OF
THE TRUSTEE OR THE DEPOSITOR.
The Class B-4 Certificates will be subordinate in right of payment to and
provide credit support to certain Classes of Certificates, as described in the
Pooling Agreement.
Series 2002-1 Portion of the Class B-4
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________
Class B-4 Remittance Rate: 6.000%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class B-4 Principal Balance as of the Cut-Off Date: $_______________
A-25-1
Registered Owner Certificate No. __
A-25-2
Exhibit A-26
CUSIP__________
MORTGAGE PASS-THROUGH CERTIFICATE
Class B-5
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four- family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended (the
"Code"). The issue date (the "Issue Date") of this Certificate is December 30,
2002. The rate at which interest is payable as of the Issue Date with respect to
this Certificate is 6.000% per annum.
IN THE CASE OF ANY CLASS B-5 CERTIFICATE PRESENTED FOR REGISTRATION IN THE
NAME OF AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR ANY "PLAN" DESCRIBED IN
SECTION 4975 OF THE CODE OR ANY ENTITY DEEMED TO HOLD PLAN ASSETS OF ANY OF
THE FOREGOING BY REASON OF A PLAN'S INTEREST IN SUCH ENTITY (A "PLAN"), THE
TRUSTEE SHALL REQUIRE SUCH TRANSFEREE TO PROVIDE AN OFFICER'S CERTIFICATE
SIGNED BY A RESPONSIBLE OFFICER OF SUCH TRANSFEREE STATING THAT THE
TRANSFEREE IS AN INSURANCE COMPANY USING ASSETS OF AN "INSURANCE COMPANY
GENERAL ACCOUNT" (WITHIN THE MEANING OF DEPARTMENT OF LABOR PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60) TO EFFECT SUCH PURCHASE AND
SATISFIES ALL OF THE REQUIREMENTS FOR EXEMPTIVE RELIEF UNDER SECTIONS I AND
III OF PTCE 95-60, WHICH OFFICER'S CERTIFICATE SHALL NOT BE AN EXPENSE OF
THE TRUSTEE OR THE DEPOSITOR.
The Class B-5 Certificates will be subordinate in right of payment to and
provide credit support to certain Classes of Certificates, as described in the
Pooling Agreement.
Series 2002-1 Portion of the Class B-5
Principal Balance as of
the Cut-Off Date
evidenced by this
Certificate:
$_______________ Class
B-5 Remittance Rate:
6.000%
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
A-20-1
Last Scheduled Distribution Date: January 25, 2033
Class B-5 Principal Balance as of the Cut-Off Date: $_______________
Registered Owner Certificate No. __
A-20-1
EXHIBIT B
FORM OF RESIDUAL CERTIFICATE
CUSIP_________
MORTGAGE PASS-THROUGH CERTIFICATE
Class R
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to-four family mortgage loans formed and administered by
DEUTSCHE MORTGAGE SECURITIES, INC.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE DEPOSITOR AND
THE TRUSTEE THAT (1) SUCH TRANSFEREE IS NOT EITHER (A) THE UNITED STATES, ANY
STATE OR POLITICAL SUBDIVISION THEREOF, ANY FOREIGN GOVERNMENT, ANY
INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE
FOREGOING, (B) ANY ORGANIZATION (OTHER THAN A COOPERATIVE DESCRIBED IN SECTION
521 OF THE CODE) WHICH IS EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE
UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE
CODE, (C) ANY ORGANIZATION DESCRIBED IN SECTION 1381(a)(2)(C) OF THE CODE (ANY
SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A), (B), OR (C) BEING
HEREINAFTER REFERRED TO AS A "DISQUALIFIED ORGANIZATION"), OR (D) AN AGENT OF A
DISQUALIFIED ORGANIZATION AND (2) NO PURPOSE OF SUCH TRANSFER IS TO ENABLE THE
TRANSFER TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX. SUCH AFFIDAVIT SHALL
INCLUDE CERTAIN REPRESENTATIONS AS TO THE FINANCIAL CONDITION OF THE PROPOSED
TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE REGISTER OF ANY
TRANSFER, SALE OR OTHER DISPOSITION OF THIS CLASS R CERTIFICATE TO A
DISQUALIFIED ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH
REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND
SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE
HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS
CERTIFICATE. EACH HOLDER OF A CLASS R CERTIFICATE BY ACCEPTANCE OF THIS
CERTIFICATE SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS
PARAGRAPH.
IN THE CASE OF ANY CLASS R CERTIFICATE, THE TRUSTEE SHALL REQUIRE SUCH
TRANSFEREE TO PROVIDE EITHER (1) AN OPINION OF COUNSEL ACCEPTABLE TO AND IN FORM
AND SUBSTANCE SATISFACTORY TO THE TRUSTEE, THE DEPOSITOR AND THE MASTER SERVICER
STATING THAT THE PURCHASE AND HOLDING OF THIS CERTIFICATE IS PERMISSIBLE UNDER
APPLICABLE LAW, WILL NOT CONSTITUTE OR RESULT IN ANY NON-EXEMPT PROHIBITED
TRANSACTION UNDER SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE CODE (OR COMPARABLE
PROVISIONS OF ANY SUBSEQUENT ENACTMENTS) AND WILL NOT SUBJECT THE MASTER
SERVICER, ANY SERVICER, THE SECURITIES ADMINISTRATOR, THE DEPOSITOR OR THE
TRUSTEE TO ANY OBLIGATION OR LIABILITY IN ADDITION TO THOSE UNDERTAKEN IN THE
POOLING AGREEMENT, WHICH OPINION OF COUNSEL SHALL NOT BE AN EXPENSE OF THE
TRUSTEE, THE DEPOSITOR, THE SECURITIES ADMINISTRATOR, ANY SERVICER OR THE MASTER
SERVICER OR (2) A TRANSFEREE AFFIDAVIT AND AGREEMENT IN SUBSTANTIALLY THE FORM
OF EXHIBIT J.
B-1
Solely for U.S. federal income tax purposes, this Certificate represents
"residual interests" in "real estate mortgage investment conduits," as those
terms are defined in Sections 860G and 860D, respectively, of the Internal
Revenue Code of 1986, as amended.
Series 2002-1 Percentage Interest
evidenced by this Class R
Certificate in the
distributions to be made
with respect to the Class
R Certificate: 6.000%%
Class R Remittance Rate: 6.000% Additionally, the Class R
Certificates are entitled
to the Residual
Distribution Amount as
defined in the Pooling
and Servicing Agreement.
Cut-Off Date: December 1, 2002
First Distribution Date: January 27, 2003
Last Scheduled Distribution Date: January 25, 2033
Class R Principal Balance as of the
Cut-Off Date: [____]
Registered Owner Certificate No._____
B-2
EXHIBIT C
[RESERVED]
X-0
XXXXXXX X
XXXXXXXX XX XXXXX
X-0
EXHIBIT E
FORM OF REGULATION S TRANSFER CERTIFICATE
[Date]
Bank One, National Association, as Trustee
000 Xxxx 00xx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Global Corporate Trust Services, Deutsche Mortgage Securities, Inc.
Series 0000-0
Xxxxxxxx Mortgage Securities, Inc.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Re: DEUTSCHE MORTGAGE SECURITIES, INC., Mortgage Pass-Through Certificates
Series 2002-1, Class X-0, X-0 and B-5 Certificates
Ladies and Gentlemen:
Reference is hereby made to the Pooling and Servicing Agreement (the
"Agreement"), dated as of December 1, 2002, between Deutsche Mortgage
Securities, Inc. ("DMSI"), Xxxxx Fargo Bank Minnesota National Association, as
master servicer (the "Master Servicer") and securities administrator and Bank
One, National Association, as trustee (the "Trustee"). Capitalized terms used
herein but not defined herein shall have the meanings assigned thereto in the
Agreement.
This letter relates to U.S. $[__________] Certificate Principal Balance of
Class [B-3] [B-4] [B-5] Certificates (the "Certificates") which are held in the
name of [name of transferor] (the "Transferor") to effect the transfer of the
Certificates to a person who wishes to take delivery thereof in the form of an
equivalent beneficial interest [name of transferee] (the "Transferee").
In connection with such request, the Transferor hereby certifies that such
transfer has been effected in accordance with the transfer restrictions set
forth in the Agreement and the private placement memorandum dated December 30,
2002 relating to the Certificates and that the following additional requirements
(if applicable) were satisfied:
(a) the offer of the Certificates was not made to a person in the United
States;
(b) at the time the buy order was originated, the Transferee was outside
the United States or the Transferor and any person acting on its behalf
reasonably believed that the Transferee was outside the United States;
E-1
(c) no directed selling efforts were made in contravention of the
requirements of Rule 903(b) or 904(b) of Regulation S, as applicable;
(d) the transfer or exchange is not part of a plan or scheme to evade the
registration requirements of the Securities Act;
(e) the Transferee is not a U.S. Person, as defined in Regulation S under
the Securities Act; and
(f) the transfer was made in accordance with the applicable provisions of
Rule 903(b)(2) or (3) or Rule 904(b)(1), as the case may be.
You and the Depositor are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby.
[Name of Transferor]
By:
--------------------
Name:
Title:
E-2
EXHIBIT F
FORM OF TRANSFEROR CERTIFICATE FOR
PRIVATELY OFFERED CERTIFICATES
[Date]
Bank One, National Association, as Trustee
000 Xxxx 00xx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attn:
Global Corporate Trust Services, Deutsche Mortgage Securities, Inc. Series
2002-1
Re:Purchase of DEUTSCHE MORTGAGE SECURITIES, INC., Mortgage Pass-Through
Certificates Series 2002-1, Class X-0, X-0 and B-5 Certificates (the
"Certificates")
Ladies and Gentlemen:
In connection with our disposition of the above Certificates we certify
that (a) we understand the Certificates have not been registered under the
Securities Act of 1933, as amended (the "Act") and are being disposed by us in a
transaction that is exempt from the registration requirements of the Act, and
(b) we have not offered or sold any certificates to, or solicited offers to buy
any Certificates from, any person, or otherwise approached or negotiated with
any person with respect thereto, or taken any other action which would result in
a violation of Section 5 of the Act.
Very truly yours,
[Name of Transferor]
By: ______________________
Authorized Officer
F-1
EXHIBIT G
FORM OF TRANSFEREE'S CERTIFICATE FOR
PRIVATELY OFFERED CERTIFICATES
[Date]
Bank One, National Association, as Trustee
000 Xxxx 00xx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Global Corporate Trust Services,
Deutsche Mortgage Securities, Inc. Series 0000-0
Xxxxxxxx Mortgage Securities, Inc.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
The undersigned (the "Purchaser") proposes to purchase Class B-3, Class B-4
and Class B-5 Certificates evidencing an undivided interest in Deutsche Mortgage
Securities, Inc. Series 2002-1 (the "Purchased Certificates") in the principal
amount of $__________. In doing so, the Purchaser hereby acknowledges and agrees
as follows:
Section 1. Definitions. Each capitalized term used herein and not otherwise
defined herein shall have the meaning ascribed to it in the Pooling and
Servicing Agreement, dated as of December 1, 2002, between Deutsche Mortgage
Securities, Inc. ("DMSI"), Xxxxx Fargo Bank Minnesota National Association, as
master servicer (the "Master Servicer") and securities administrator and Bank
One, National Association, as trustee (the "Trustee"), of the Deutsche Mortgage
Securities, Inc., Mortgage Pass-Through Certificates, Series 2002-1.
Section 2 Representations and Warranties of the Purchaser. In connection
with the proposed transfer, the Purchaser represents and warrants to DMSI, the
Master Servicer and the Trustee that:
(a) The Purchaser is duly organized, validly existing and in good standing
under the laws of the jurisdiction in which the Purchaser is organized, is
authorized to invest in the Purchased Certificates, and to enter into this
Agreement, and duly executed and delivered this Agreement;
(b) The Purchaser is acquiring the Purchased Certificates for its own
account as principal and not with a view the distribution thereof, in whole or
in part;
(c) The Purchaser is an "accredited investor" as such term is defined in
paragraph (a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) of Section 501 of Regulation
D under the Securities Act of 1933, as amended (the "Act"), has knowledge of
financial and business matters and is capable of evaluating the merits and risks
of an investment in the Purchased Certificates; the Purchaser has sought such
accounting, legal and tax advice as it has considered necessary
G-1
to make an informed investment decision; and the Purchaser is able to bear the
economic risk of an investment in the Purchased Certificates and can afford a
complete loss of such investment;
(d) The Purchaser is not affiliated with the Trustee;
(e) The Purchaser confirms that DMSI has made available to the Purchaser
the opportunity to ask questions of, and receive answers from DMSI concerning
the Trust, the purchase by the Purchaser of the Purchased Certificates and all
matters relating thereto that DMSI possesses or can acquire without unreasonable
effort or expense;
(f) If applicable, the Purchaser has complied, and will continue to comply,
with the guidelines established by Thrift Bulletin 12 issued December 13, 1988,
by the Office of Regulatory Activities of the Federal Home Loan Bank System; and
(g) The Purchaser will provide the Trustee and the Master Servicer with
affidavits substantially in the form of Exhibit A attached hereto.
Section 3. Transfer of Purchased Certificates.
(a) The Purchaser understands that the Purchased Certificates have not been
registered under the Act, or any state securities laws and that no transfer may
be made unless the Purchased Certificates are registered under the Act and under
applicable state law or unless an exemption from registration is available. The
Purchaser further understands that neither DMSI nor the Trust is under any
obligation to register the Purchased Certificates or make an exemption
available. In the event that such a transfer is to be made within two years from
the Closing Date without registration under the Act or applicable state
securities laws, (i) the Trustee shall require, in order to assure compliance
with such laws, that the Certificateholder's prospective transferees each
certify to DMSI and the Trustee as to the factual basis for the registration or
qualification exemption relied upon, and (ii) the Trustee or DMSI may require an
Opinion of Counsel that such transfer may be made pursuant to an exemption from
the Act and state securities laws, which Opinion of Counsel shall not be an
expense of the Trustee or DMSI. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee and DMSI
against any liability that may result if the Transfer is not so exempt or is not
made in accordance with such federal and state laws.
(b) The Purchaser acknowledges that its Purchased Certificates bear a
legend setting forth the applicable restrictions on transfer.
G-2
IN WITNESS WHEREOF, the undersigned has caused this Agreement to be validly
executed by its duly authorized representative as of the day and the year first
above written.
[Purchaser]
By:_______________________________
Its:
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EXHIBIT H
FORM OF BENEFIT PLAN AFFIDAVIT
[Date]
Bank One, National Association, as Trustee
000 Xxxx 00xx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Global Corporate Trust Services, Deutsche Mortgage Securities, Inc.
Series 0000-0
Xxxxxxxx Mortgage Securities, Inc.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Re: Deutsche Mortgage Securities, Inc. Mortgage Pass-through Certificates,
Series 2002-1 (the "Trust") Class [M, X-0, X-0, X-0, X-0, B-5]
Certificates (the "Purchased Certificates")
Under penalties of perjury, I, ___________________, declare that, to the
best of my knowledge and belief, the following representations are true, correct
and complete; and
1. That I am the _________ of _________________ (the "Purchaser"), whose
taxpayer identification number is ___________, and on behalf of which I have the
authority to make this affidavit.
2. That the Purchaser is acquiring a Purchased Certificate representing an
interest in the Trust.
3. [Only with respect to the Class M, Class B-1 and Class B-2
Certificates.] That the Purchaser (i) is not an employee benefit plan subject to
the Employee Retirement Income Security Act of 1974, as amended ("ERISA") or a
"plan" described in Section 4975 of the Internal Revenue Code of 1986, as
amended (the "Code") or any entity deemed to hold plan assets of any of the
foregoing by reason of a plan's investment in such entity (a "Plan"), or (ii)
either (A) it has acquired and is holding such Purchased Certificates in
reliance on Department of Labor Prohibited Transaction Exemption 94-84 or FAN
97-03E, as amended, that it understands that there are certain conditions to the
availability of the exemptions, including that such certificates are rated at
the time of purchase in one of the top four rating categories by at least one
Rating Agency (as defined in the Pooling and Servicing Agreement, dated as of
December 1, 2002, among Deutsche Mortgage Securities, Inc., as depositor, Xxxxx
Fargo Bank Minnesota National Association, as master servicer and securities
administrator and Bank One, National Association, as trustee) or (B) the
Purchaser is an insurance company using assets of an "insurance company general
account" that is eligible for, and satisfies all of the requirements of Sections
I and III of Prohibited Transaction Class Exemption 95-60.
H-1
4. [Only with respect to the Class B-3, Class B-4 and Class B-5
Certificates.] The Purchaser is not an employee benefit plan subject to the
Employee Retirement Income Security Act of 1974, as amended ("ERISA") or a
"plan" described in Section 4975 of the Internal Revenue Code of 1986, as
amended (the "Code") or any entity deemed to hold plan assets of any of the
foregoing by reason of a plan's investment in such entity (a "Plan") unless such
Purchaser is an insurance company using assets of an "insurance company general
account" that is eligible for, and satisfies all of the requirements of Sections
I and III of Prohibited Transaction Class Exemption 95-60.
IN WITNESS WHEREOF, the Purchaser has caused this instrument to be duly
executed on its behalf, by its duly authorized officer this day of
_____________, 20 .
[Purchaser]
By:_______________________________
Its:
H-2
Personally appeared before me ________________, known or proved to me to be
the same person who executed the foregoing instrument and to be a
_______________ of the Purchaser, and acknowledged to me that (s)he executed the
same as his/her free act and deed and as the free act and deed of the Purchaser.
SUBSCRIBED and SWORN to before me this __day of __________, 20 .
Notary Public
H-3
EXHIBIT I
FORM OF TRANSFEROR CERTIFICATE
[Date]
Bank One, National Association, as Trustee
000 Xxxx 00xx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Global Corporate Trust Services, Deutsche Mortgage Securities, Inc. Series
2002-1
Re: Deutsche Mortgage Securities, Inc. Mortgage Pass-Through Certificates,
Series 2002-1 Class R
This letter is delivered to you in connection with the sale by
_______________ (the "Seller") to ____________ (the "Purchaser") of
$_____________ initial Certificate Principal Balance of Mortgage Pass- Through
Certificates, Series 2002-1, Class R (the "Certificate"), pursuant to Section
5.1 of the Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement"), dated as of December 1, 2002 among Deutsche Mortgage Securities,
Inc., as depositor (the "Company"),Xxxxx Fargo Bank Minnesota National
Association, as master servicer (the "Master Servicer") and securities
administrator, and Bank One, National Association, as trustee (the "Trustee").
All terms used herein and not otherwise defined shall have the meanings set
forth in the Pooling and Servicing Agreement. The Seller hereby certifies,
represents and warrants to, and covenants with the Depositor, the Master
Servicer and the Trustee that:
1. No purpose of the Seller relating to the sale of the Certificate by
the Seller to the Purchaser is or will be to enable the Seller to impede the
assessment or collection of tax.
2. The Seller understands that the Purchaser has delivered to the
Trustee, the Master Servicer and the Depositor a transferee affidavit and
agreement in the form attached to the Pooling and Servicing Agreement as Exhibit
J. The Seller does not know or believe that any representation contained therein
is false.
3. The Seller has no actual knowledge that the Proposed Transferee is
not a Permitted Transferee.
4. The Seller has no actual knowledge that the Purchaser would be
unwilling or unable to pay taxes due on its share of the taxable income
attributable to the Certificates.
5. At the time of this transfer (i) the Seller has conducted a
reasonable investigation of the financial condition of the Purchaser and, as a
result of the investigation, found that the Purchaser has historically paid its
debts as they came due, and found no significant evidence to indicate that the
Purchaser will not continue to pay its debts as they come due in the future and
(ii) either (A) the Seller (1) has determined all of the following (I) at the
time of the transfer, and at the close of each of the Purchaser's two fiscal
years preceding the year of transfer, the
I-1
Purchaser's gross assets for financial reporting purposes exceed $100 million
and its net assets for such purposes exceed $10 million (disregarding, for
purposes of determining gross or net assets, the obligation of any person
related to the Purchaser within the meaning of section 860L(g) of the Code or
any other asset if a principal purpose for holding or acquiring that asset is to
permit the Purchaser to satisfy this minimum gross asset or net asset
requirement), (II) the Purchaser is a domestic C corporation for United States
federal income tax purposes that is not for such purposes an exempt corporation,
a regulated investment company, a real estate investment trust, a REMIC, or a
cooperative organization to which part I of subchapter T of the Code applies,
(III) there are no facts or circumstances on or before the date of transfer (or
anticipated) which would reasonably indicate that the taxes associated with the
Certificates will not be paid, (IV) the Purchaser is not a foreign branch of a
domestic corporation, and (V) the transfer does not involve a transfer or
assignment to a foreign branch of a domestic corporation (or any other
arrangement by which any Certificate is at any time subject to net tax by a
foreign country or U.S. possession) and the Purchaser will not hereafter engage
in any such transfer or assignment (or any such arrangement), and (2) does not
know or have reason to know that the Purchaser will not honor the restrictions
on subsequent transfers of any Class R Certificate described in paragraph 12 and
13 of the Transferee's Transfer Affidavit, or (B) the Seller has determined that
the present value of the anticipated tax liabilities associated with the holding
of the Certificates do not exceed the sum of (1) the present value of any
consideration given to the Purchaser to acquire the Certificates, (2) the
present value of the expected future distributions on the Certificates, and (3)
the present value of the anticipated tax savings associated with holding the
Certificates as the REMIC generates losses (having made such determination by
(I) assuming that the Purchaser pays tax at a rate equal to the highest rate of
tax specified in Section 11(b)(1) of the Code, and (II) utilizing a discount
rate for present valuation purposes equal to the applicable Federal rate
prescribed by Section 1274(d) of the Code compounded semi-annually (or a lower
discount rate based on the Purchaser having demonstrated that it regularly
borrows, in the course of its trade or business, substantial funds at such lower
rate from unrelated third parties)).
6. The Purchaser has represented to the Seller that, if the
Certificates constitute a noneconomic residual interest, it (i) understands that
as holder of a noneconomic residual interest it may incur tax liabilities in
excess of any cash flows generated by the interest, and (ii) intends to pay
taxes associated with its holding of the Certificates as they become due.
7. The Seller understands that the transfer of the Certificates may
not be respected for United States income tax purposes (and the Seller may
continue to be liable for United States income taxes associated therewith)
unless there is compliance with the standards of paragraph 5. above as to any
transfer.
Very truly yours,
[Seller]
By:________________________
Name:______________________
I-2
Title:_____________________
I-3
EXHIBIT J
FORM OF TRANSFEREE AFFIDAVIT AND AGREEMENT
STATE OF )
) ss:
COUNTY OF )
[NAME OF OFFICER], being first duly sworn,
deposes and says:
1. That he is [Title of Officer] of [Name of Owner] (record or beneficial
owner of the Class R Certificate (the "Owner")), a [savings institution]
[corporation] duly organized and existing under the laws of [the State of
_____________] [the United States], on behalf of which he makes this affidavit
and agreement.
2. That the Owner (i) is not and will not be a "disqualified organization"
as of the [date of transfer] within the meaning of Section 860E(e)(5) of the
Internal Revenue Code of 1986, as amended (the "Code") and will endeavor to
remain other than a disqualified organization for so long as it retains its
ownership interest in the Class R Certificate, and (ii) is acquiring the Class R
Certificate for its own account or for the account of another Owner from which
it has received an affidavit and agreement in substantially the same form as
this affidavit and agreement. (For this purpose, a "disqualified organization"
means the United States, any state or political subdivision thereof, or any
agency or instrumentality of any of the foregoing (other than an instrumentality
all of the activities of which are subject to tax and, except for the Federal
Home Loan Mortgage Corporation, a majority of whose board of directors is not
selected by any such governmental entity, or any foreign government or
international organization, or any agency or instrumentality of such foreign
government or organization, any rural electric or telephone cooperative, or any
organization (other than certain farmers' cooperatives) that is generally exempt
from federal income tax unless such organization is subject to the tax on
unrelated business taxable income).
3. That the Owner is aware (i) of the tax that would be imposed on
transfers of the Class R Certificate; (ii) that such tax would be on the
transferor, or, if such transfer is through an agent (which person includes a
broker, nominee or middleman) for a disqualified organization, on the agent;
(iii) that the person otherwise liable for the tax shall be relieved of
liability for the tax if the transferee furnished to such person an affidavit
that the transferee is not a disqualified organization and, at the time of
transfer, such person does not have actual knowledge that the affidavit is
false; and (iv) that the Class R Certificate may represent "noneconomic residual
interests" within the meaning of Treasury regulations promulgated pursuant to
the Code and that the transferor of a noneconomic residual interest will remain
liable for any taxes due with respect to the income on such residual interest,
if a significant purpose of the transfer was to enable the transferor to impede
the assessment or collection of tax.
4. That the Owner is aware of the tax imposed on a "pass-through entity"
holding the Class R Certificate if at any time during the taxable year of the
pass-through entity a disqualified organization is the record holder of an
interest in such entity. (For this purpose, a "pass-through entity" includes a
regulated investment company, a real estate investment trust or common trust
fund, a partnership, trust or estate, and certain cooperatives.)
J-1
5. That the Owner is aware that the Trustee will not register the transfer
of the Class R Certificate unless the transferee, or other transferee's agent,
delivers to each of them an affidavit and agreement, among other things, in
substantially the same form as this affidavit and agreement. The Owner expressly
agrees that it will not consummate any such transfer if it knows or believes
that any of the representations contained in such affidavit and agreement are
false.
6. That the Owner has reviewed the restrictions set forth on the face of
the Class R Certificate and the provisions of Section 5.1 of the Pooling and
Servicing Agreement under which the Class R Certificate was issued. The Owner
expressly agrees to be bound by and to comply with such restrictions and
provisions.
7. That the Owner consents to any additional restrictions or arrangements
that shall be deemed necessary upon advice of counsel to constitute a reasonable
arrangement to ensure that the Class R Certificate will only be owned, directly
or indirectly, by an Owner that is not a disqualified organization.
8. The Owner's Taxpayer Identification Number is _______________________.
9. That no purpose of the Owner relating to the purchase of the Class R
Certificate by the Owner is or will be to enable the transferor to impede the
assessment or collection of tax.
10. That the Owner has no present knowledge or expectation that it will be
unable to pay any United States taxes owed by it so long as any of the
Certificates remain outstanding.
11. That the Owner has no present knowledge or expectation that it will
become insolvent or subject to a bankruptcy proceeding for so long as any of the
Certificates remain outstanding.
12. That Owner will, in connection with any transfer that it makes of the
Class R Certificate deliver to the Trustee a representation letter substantially
in the form of Exhibit I to the Pooling and Servicing Agreement. [The Owner
hereby agrees that it will not make any transfer of any Class R Certificate
unless (i) the transfer is to an entity which is a domestic C corporation (other
than an exempt corporation, a regulated investment company, a real estate
investment trust, a REMIC, or a cooperative organization to which part I of
Subchapter T of the Code applies) for federal income tax purposes, and (ii) the
transfer is in compliance with the conditions set forth in paragraph 5 of
Exhibit I of the Pooling and Servicing Agreement.]1/.
----------
1 Bracketed text to be included if the Owner is relying on the transferee's
compliance with the "Asset Test Safe Harbor" (which is generally described as
the second "safe harbor" in the Prospectus Supplement) rather then the "Formula
Test Safe Harbor" (which is generally described as the first "safe harbor" in
the Prospectus Supplement). See "Federal Income Tax Consequences--Special Tax
Considerations Applicable to the Residual Certificate" in the Prospectus
Supplement.
J-2
13. The Owner (i) is a citizen or resident of the United States, a
corporation or partnership (including an entity treated as a corporation or
partnership for federal income tax purposes) created or organized in, or under
the laws of, the United States or any state thereof or the District of Columbia
(except, in the case of a partnership, to the extent provided in regulations) or
an estate whose income is subject to United States federal income tax regardless
of its source, or a trust if a court within the United States is able to
exercise primary supervision over the administration of the trust and one or
more such U.S. Persons have the authority to control all substantial decisions
of the trust and (ii) if the Owner is a partnership for U.S. federal income tax
purposes, each person or entity which holds an interest (directly or indirectly,
through a pass-through entity) is a person or entity described in (i). To the
extent prescribed in regulations by the Secretary of the Treasury, which have
not yet been issued, a trust which was in existence on August 20, 1996 (other
than a trust treated as owned by the grantor under subpart E of part 1 of
subchapter J of chapter 1 of the Code), and which was treated as a U.S. Person
on August 20, 1996 may elect to continue to be treated as a U.S. Person
notwithstanding the previous sentence.
14. The Owner hereby agrees to cooperate with the Depositor and to take any
action required of it by the Code or Treasury regulations thereunder (whether
now or hereafter promulgated) in order to create or maintain the REMIC status of
the REMIC I or the REMIC II.
15. The Owner hereby agrees that it will not take any action that could
endanger the REMIC status of the REMIC I or the REMIC II, as applicable, or
result in the imposition of tax on the REMIC I or the REMIC II unless counsel
for, or acceptable to, the Depositor has provided an opinion that such action
will not result in the loss of such REMIC status or the imposition of such tax,
as applicable.
16. The Owner as transferee of the Class R Certificate has represented to
their transferor that, if the Class R Certificate represents noneconomic
residual interests, the Owner (i) understands that as holder of a noneconomic
residual interest it may incur tax liabilities in excess of any cash flows
generated by the interest, and (ii) intends to pay taxes associated with its
holding of the Class R Certificate as they become due.
17. (a) The Owner as transferee of the Class R Certificate is not an
employee benefit plan subject to the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), or any "plan" described in Section 4975 of the Code,
as amended (the "Code"), or any entity deemed to hold plan assets of any of the
foregoing by reason of a plan's investment in such entity; or
(b) The Purchaser will provide the Trustee, the Depositor and the Master
Servicer with an opinion of counsel acceptable to and in form and substance
satisfactory to the Trustee, the Depositor, and the Master Servicer to the
effect that the purchase and holding of the Class R Certificates is permissible
under applicable law, will not constitute or result in any non-exempt prohibited
transaction under ERISA or Section 4975 of the Code (or comparable provisions of
any subsequent enactments) and will not subject the Trustee, the Depositor, the
Securities Administrator, any Servicer or the Master Servicer to any obligation
or liability (including obligations or liabilities under ERISA or Section 4975
of the Code) in addition to those undertaken in the Pooling and Servicing
Agreement.
J-3
In addition, the Owner hereby certifies, represents and warrants to, and
covenants with, the Depositor, the Trustee and the Master Servicer that the
Owner will not transfer such Certificates to any Plan or person unless either
such Plan or person meets the requirements set forth in either (a) or (b) above.
J-4
IN WITNESS WHEREOF, the Owner has caused this instrument to be executed
on its behalf, pursuant to the authority of its Board of Directors, by its
[Title of Officer] and its corporate seal to be hereunto attached, attested by
its [Assistant] Secretary, this day of , 20
[Name of Owner]
By:___________________________
[Name of Officer]
[Title of Officer]
[Corporate Seal]
ATTEST:
[Assistant] Secretary
J-5
Personally appeared before me the above-named [Name of Officer], known or
proved to me to be the same person who executed the foregoing instrument and to
be the [Title of Officer] of the Owner, and Acknowledged to me that he executed
the same as his free act and deed and free act and deed of the Owner.
Subscribed and sworn before me this day of ___________, 20 .
NOTARY PUBLIC
COUNTY OF
STATE OF
Commission expires the day
of __________, 20
J-6
EXHIBIT K
FORM OF ADDITIONAL MATTER INCORPORATED
INTO THE FORM OF THE CERTIFICATES
This Certificate does not represent an obligation of or interest in
Deutsche Mortgage Securities, Inc. or any of its affiliates. Neither this
Certificate nor the underlying Loans are guaranteed by any agency or
instrumentality of the United States.
This certifies that the above-mentioned Registered Owner is the registered
owner of certain interests in a trust fund (the "Certificate Trust Fund") whose
assets consist of, among other things, a pool (the "Mortgage Pool") of
conventional one- to four-family mortgage loans (the "Loans"), formed by
Deutsche Mortgage Securities, Inc. (the "Depositor"). The Loans were originated
or acquired by various financial institutions and subsequently acquired by the
Depositor. The Mortgage Pool was created pursuant to a Pooling and Servicing
Agreement, dated as of the Cut- Off Date stated above (the "Pooling Agreement"),
among the Depositor, Xxxxx Fargo Bank Minnesota National Association, as Master
Servicer (the "Master Servicer") and securities administrator (the "Securities
Administrator"), and Bank One, National Association, as Trustee (the "Trustee"),
a summary of certain of the pertinent provisions of which is set forth
hereafter. To the extent not defined herein, the capitalized terms used herein
have the meanings assigned in the Pooling Agreement. Nothing herein shall be
deemed inconsistent with such meanings, and in the event of any conflict between
the Pooling Agreement and the terms of this Certificate, the Pooling Agreement
shall control. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Pooling Agreement, to which Pooling Agreement
the Holder of this Certificate, by virtue of the acceptance hereof, assents and
by which such Holder is bound.
Distributions will be made, pursuant to the Pooling Agreement, on the 25th
day of each month or, if such 25th day is not a Business Day, the Business Day
immediately following (the "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the last Business Day of the month
immediately preceding the month of such distribution (the "Record Date"), to the
extent of such Certificateholder's Percentage Interest represented by this
Certificate in the portion of the Available Distribution Amount for such
Distribution Date then distributable on the Certificates of this Class, as
specified in Section 4.1 of the Pooling Agreement.
Distributions on this Certificate will be made by the Trustee by wire
transfer or by other means of payment acceptable to each Certificateholder of
record on the immediately preceding Record Date. Notwithstanding the above, the
final distribution on this Certificate will be made after due notice by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Certificate to the Trustee.
Reference is hereby made to the further provisions of this Certificate set
forth below, which further provisions shall for all purposes have the same
effect as if set forth at this place.
K-1
Unless the certificate of authentication hereon has been executed by or on
behalf of the Trustee, by manual signature, this Certificate shall not be
entitled to any benefit under the Pooling Agreement or be valid for any purpose.
MORTGAGE PASS-THROUGH CERTIFICATE
This Certificate is one of a duly authorized issue of Certificates
designated as Mortgage Pass-Through Certificates of the Series and Class
specified hereon (herein called the "Certificates") and representing certain
interests in the Certificate Trust Fund.
The Certificates do not represent an obligation of, or an interest in, the
Depositor or any of its affiliates and are not insured or guaranteed by any
governmental agency. The Certificates are limited in right of payment to certain
collections and recoveries respecting the Loans, all as more specifically set
forth herein and in the Pooling Agreement. To the extent described in the
Pooling Agreement, each Servicer and the Master Servicer are obligated to
advance their own funds to cover certain shortfalls with respect to payments on
the Loans. In the event Servicer or Master Servicer, as applicable, funds are
advanced with respect to any Loan, such advance is reimbursable to the related
Servicer from the related recoveries on such Loan or from other cash deposited
in a Protected Account for principal and interest advances to the extent that
such advance is not otherwise recoverable.
As provided in the Pooling Agreement, withdrawals from the related
Protected Account for principal and interest advances may be made by the related
Servicer and if applicable withdrawals from the Master Servicer Collection
Account for principal and interest advances may be made by the Master Servicer
from time to time for purposes other than distributions to Certificateholders,
such purposes including reimbursement to the related Servicer or Master
Servicer, as applicable of advances made, or certain expenses incurred, by it.
The Pooling Agreement permits, with certain exceptions therein provided,
the amendment thereof by the Depositor, the Master Servicer, the Securities
Administrator and the Trustee, with the consent of the Holders of the
Certificates aggregating not less than 66-2/3% of the aggregate Percentage
Interest evidenced by all of the Certificates of the Trust Fund. For the
purposes of such provision and except as provided below, voting rights related
to 100% of the Aggregate Certificate Principal Balance of any Class will be
allocated pro rata (by Certificate Principal Balance) among the Certificates of
such Class. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange hereof or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Pooling Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.
As provided in the Pooling Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the office maintained by the Trustee in the City and State of New
York, duly endorsed by, or accompanied by an assignment in the form below or
other written instrument of transfer in form satisfactory to the Trustee duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new
K-2
Certificates of Authorized Denominations evidencing the same Percentage Interest
set forth hereinabove will be issued to the designated transferee or
transferees.
No transfer of a Certificate will be made unless such transfer is exempt
from or is made in accordance with the registration requirements of the
Securities Act of 1933, as amended (the "Securities Act") and any applicable
state securities laws. No transfer, sale, pledge or other disposition of a Class
R Certificate shall be made unless such transfer, sale, pledge or other
disposition is made in accordance with Section 5.1(c) or Section 5.1(d) of the
Pooling Agreement. No transfer, sale, pledge or other disposition of a Junior
Subordinate Certificate shall be made unless such transfer, sale, pledge or
other disposition is made in accordance with Section 5.1(e), Section 5.1(f) or
Section 5.1(g) of the Pooling Agreement. Each Person who, at any time, acquires
any ownership interest in any Junior Subordinate Certificate shall be deemed by
the acceptance or acquisition of such ownership interest to have agreed to be
bound by the provisions of such Section 5.1(e), Section 5.1(f) or Section
5.1(g), as applicable. No transfer of a Junior Subordinate Certificate shall be
deemed to be made in accordance with such Section 5.1(e) unless such transfer is
made pursuant to an effective registration statement under the Securities Act or
unless the Trustee is provided with the certificates and either (i) an Opinion
of Counsel which opines that such transfer is exempt from the registration
requirements under the Securities Act or (ii) a statement of the
Certificateholder desiring to effect such transfer certifying to the Trustee in
writing, in substantially the form attached as Exhibit F to the Pooling
Agreement, the facts surrounding the transfer, with such modifications to such
Exhibit F as may be appropriate to reflect the actual facts of the proposed
transfer, and a statement of the Certificateholder's proposed transferee
certifying to the Trustee in writing, in substantially the form attached as
Exhibit G to the Pooling Agreement, the facts surrounding the transfer, with
such modifications to such Exhibit G as may be appropriate to reflect the actual
facts of the proposed transfer. If such certificate of the proposed transferee
does not contain substantially the substance of Exhibit G, the Trustee shall
require an Opinion of Counsel satisfactory to it that such transfer may be made
without registration, which Opinion of Counsel shall not be obtained at the
expense of the Trustee, the Trust Fund, the Securities Administrator, the
Certificate Registrar or the Depositor.
Transfers of the Junior Subordinate Certificates may also be made in
accordance with Section 5.1(f) of the Pooling Agreement. To effectuate a
Certificate transfer in accordance with such Section 5.1(f), the proposed
transferee of such Certificate must provide the Trustee and the Depositor with
an investment letter substantially in the form of Exhibit L attached to the
Pooling Agreement, which investment letter shall not be an expense of the
Trustee, the Securities Administrator, the Certificate Registrar or the
Depositor, and which investment letter states that, among other things, such
transferee (i) is a "qualified institutional buyer" as defined under Rule 144A,
acting for its own account or the accounts of other "qualified institutional
buyers" as defined under Rule 144A, and (ii) is aware that the proposed
transferor intends to rely on the exemption from registration requirements under
the Securities Act provided by Rule 144A. Notwithstanding the foregoing, the
proposed transferee of such Certificate shall not be required to provide the
Trustee, the Certificate Registrar or the Depositor with Annex 1 or Annex 2 to
the form of such Exhibit L if the Depositor so consents in writing (with a copy
to the Trustee) prior to each such transfer. Such transfers shall be deemed to
have complied with the requirements of Section 5.1(f) of the Pooling Agreement.
The Holder of a Certificate desiring to effect such transfer does hereby agree
to indemnify the Trustee, the Securities Administrator, the Depositor and the
Certificate Registrar against any cost, expense or liability that may result if
transfer is not made in accordance with the Pooling Agreement.
K-3
Transfers of the Junior Subordinate Certificates may also be made in
accordance with Section 5.1(g). To effectuate a Certificate transfer in
accordance with Section 5.1(g) without registration under the Securities Act,
the Certificateholder desiring to effect such transfer must provide the Trustee
and the Depositor with a certificate substantially in the form of Exhibit E
attached to the Pooling Agreement, to the effect that such transfer is being
made in accordance with Rule 903 or Rule 904 of Regulation S. Such transfers
shall be deemed to have complied with the requirements of Section 5.1(g). The
Holder of a Certificate desiring to effect such transfer does hereby agree to
indemnify the Trustee, the Securities Administrator the Depositor, and the
Certificate Registrar against any cost, expense or liability that may result if
transfer is not made in accordance with the Pooling Agreement.
The Certificates are issuable only as registered Certificates without
coupons in Authorized Denominations specified in the Pooling Agreement. As
provided in the Pooling Agreement and subject to certain limitations therein set
forth, Certificates are exchangeable for new Certificates of Authorized
Denominations evidencing the same aggregate interest in the portion of the
Available Distribution Amount distributable on this Class of Certificate, as
requested by the Holder surrendering the same.
A reasonable service charge may be made for any such registration of
transfer or exchange, and the Trustee may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
The Depositor, the Securities Administrator, the Master Servicer, the
Trustee and any agent of any of them may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes, and neither the
Depositor, the Master Servicer, the Securities Administrator, the Trustee nor
any such agent shall be affected by notice to the contrary.
The respective obligations and responsibilities of the Depositor, Master
Servicer, the Securities Administrator and the Trustee created under the Pooling
Agreement (other than the obligation to make payments to Certificateholders as
set forth therein) shall terminate upon the earlier of (i) the later of the
final payment or other liquidation (or any Advance with respect thereto) of the
last Loan remaining in the Trust Fund and the disposition of all property
acquired in respect of any Loan or (ii) the purchase by the Master Servicer of
all Loans at a price established pursuant to the Pooling Agreement; provided,
however, that in no event shall the trust created hereby continue beyond 21
years from the death of the survivor of certain persons identified in the
Pooling Agreement.
K-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed.
Dated: December 30, 2002
BANK ONE NATIONAL ASSOCIATION
as Trustee
By:_____________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
-----------------------------
This is one of the Class [___] Certificates referred to in the
within-mentioned Agreement.
BANK ONE NATIONAL ASSOCIATION
as Trustee
By:_____________________________
Authorized Signatory
K-5
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sell(s) and assign(s) and
transfer(s) unto
(Please print or typewrite name and address, including postal zip code of
assignee. Please insert social security or other identifying number of
assignee.)
the within Mortgage Pass-Through Certificate and hereby irrevocably constitutes
and appoints Attorney to transfer said Certificate on
the Certificate Register, with full power of substitution in the premises.
Dated:
------ --------------------
Signature Guaranteed
--------------------
NOTICE:
The signature to this assignment must correspond with
the name as written upon the face of the within
instrument in every particular, without alteration or
enlargement or any change whatever.
K-6
EXHIBIT L
FORM OF RULE 144A INVESTMENT REPRESENTATION
Description of Rule 144A Securities, including numbers:
--------------------
--------------------
--------------------
--------------------
The undersigned seller, as registered holder (the "Seller"), intends to transfer
the Rule 144A Securities described above to the undersigned buyer (the "Buyer").
1. In connection with such transfer and in accordance with the agreements
pursuant to which the Rule 144A Securities were issued, the Seller hereby
certifies the following facts: Neither the Seller nor anyone acting on its
behalf has offered, transferred, pledged, sold or otherwise disposed of the Rule
144A Securities, any interest in the Rule 144A Securities or any other similar
security to, or solicited any offer to buy or accept a transfer, pledge or any
disposition of the Rule 144A Securities, any interest in the Rule 144A
Securities or any other similar security from, or otherwise approached or
negotiated with respect to the Rule 144A Securities, any interest in the Rule
144A Securities or any other similar security with, any person in any manner, or
made any general solicitation by means of general advertising or in any other
manner, or taken any other action, that would constitute a distribution of the
Rule 144A Securities under the Securities Act of 1933, as amended (the "1933
Act"), or that would render the disposition of the Rule 144A Securities in
violation of Section 5 of the 1933 Act or require registration pursuant thereto,
and that the Seller has not offered the Rule 144A Securities to any person other
than the Buyer or another "qualified institutional buyer" as defined in Rule
144A under the 0000 Xxx.
2. The Buyer warrants and represents to, and covenants with, the Seller,
the Trustee and the Master Servicer (as defined in the Pooling and Servicing
Agreement (the "Agreement") dated as of December 1, 2002 between Deutsche
Mortgage Securities, Inc., as Depositor, Xxxxx Fargo Bank Minnesota National
Association, as Master Servicer and Securities Administrator, and Bank One,
National Association, as Trustee) pursuant to Section 5.1(f) of the Agreement,
as follows:
(a) The Buyer understands that the Rule 144A Securities have not been
registered under the 1933 Act or the securities laws of any state.
(b) The Buyer considers itself a substantial, sophisticated
institutional investor having such knowledge and experience in financial and
business matters that it is capable of evaluating the merits and risks of
investment in the Rule 144A Securities.
L-1
(c) The Buyer has received and reviewed the Private Placement
Memorandum dated as of [_________________] relating to the Rule 144A Securities
and has been furnished with all information regarding the Rule 144A Securities
that it has requested from the Seller, the Trustee, the Depositor or the Master
Servicer.
(d) Neither the Buyer nor anyone acting on its behalf has offered,
transferred, pledged, sold or otherwise disposed of the Rule 144A Securities,
any interest in the Rule 144A Securities or any other similar security to, or
solicited any offer to buy or accept a transfer, pledge or other disposition of
the Rule 144A Securities, any interest in the Rule 144A Securities or any other
similar security from, or otherwise approached or negotiated with respect to the
Rule 144A Securities, any interest in the Rule 144A Securities or any other
similar security with, any person in any manner, or made any general
solicitation by means of general advertising or in any other manner, or taken
any other action, that would constitute a distribution of the Rule 144A
Securities under the 1933 Act or that would render the disposition of the Rule
144A Securities a violation of Section 5 of the 1933 Act or require registration
pursuant thereto, nor will it act, nor has it authorized or will it authorize
any person to act, in such manner with respect to the Rule 144A Securities.
(e) The Buyer is a "qualified institutional buyer" as that term is
defined in Rule 144A under the 1933 Act and has (1) completed either of the
forms of certification to that effect attached hereto as Annex 1 or Annex 2, or
(2) obtained the waiver of the Depositor with respect to Annex 1 and Annex 2
pursuant to Section 5.1(f) of the Agreement. The Buyer is aware that the sale to
it is being made in reliance on Rule 144A. The Buyer is acquiring the Rule 144A
Securities for its own account or the accounts of other qualified institutional
buyers, understands that such Rule 144A Securities may be resold, pledged or
transferred only (i) to a person reasonably believed to be a qualified
institutional buyer that purchases for its own account or for the account of a
qualified institutional buyer to whom notice is given that the resale, pledge or
transfer is being made in reliance on Rule 144A, or (ii) pursuant to another
exemption from registration under the 1933 Act.
(f) The Buyer is not affiliated with (i) the Trustee or (ii) any
Rating Agency that rated the Rule 144A Securities.
(g) If applicable, the Buyer has complied, and will continue to
comply, with the guidelines established by Thrift Bulletin 12 issued December
13, 1988, by the Office of Regulatory Activities of the Federal Home Loan Bank
System.
3. This document may be executed in one or more counterparts and by the
different parties hereto on separate counterparts, each of which, when so
executed, shall be deemed to be an original; such counterparts, together, shall
constitute one and the same document.
L-2
IN WITNESS WHEREOF, each of the parties has executed this document as of
the date set forth below.
Print Name of Seller Print Name of Buyer
By: __________________________ By:_________________________
Name: Name:
Title: Title:
Taxpayer Identification Taxpayer Identification
No.: No.:
Date: Date:
L-3
Annex 1 to Exhibit L
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Buyers Other Than Registered Investment Companies]
The undersigned hereby certifies as follows in connection with the Rule
144A Investment Representation to which this Certification is attached:
1. As indicated below, the undersigned is the President, Chief Financial
Officer, Senior Vice-President or other executive officer of the Buyer.
2. In connection with purchases by the Buyer, the Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933 ("Rule 144A") because (i) the Buyer owned and/or invested on a
discretionary basis $__________2/ in securities (except for the excluded
securities referred to below) as of the end of the Buyer's most recent fiscal
year (such amount being calculated in accordance with Rule 144A) and (ii) the
Buyer satisfies the criteria in the category marked below.
Corporation, etc. The Buyer is a corporation (other than a bank,
savings and loan association or similar institution), Massachusetts or
similar business trust, partnership, or charitable organization
described in Section 501(c)(3) of the Internal Revenue Code.
Bank. The Buyer (a) is a national bank or banking institution
organized under the laws of any State, territory or the District of
Columbia, the business of which is substantially confined to banking
and is supervised by the State or territorial banking commission or
similar official or is a foreign bank or equivalent institution, and
(b) has an audited net worth of at least $25,000,000 as demonstrated
in its latest annual financial statements, a copy of which is attached
hereto.
Savings and Loan. The Buyer (a) is a savings and loan association,
building and loan association, cooperative bank, homestead association
or similar institution, which is supervised and examined by a State or
Federal authority having supervision over any such institutions or is
a foreign savings and loan association or equivalent institution and
(b) has an audited net worth of at least $25,000,000 as demonstrated
in its latest annual financial statements.
Broker-Dealer. The Buyer is a dealer registered pursuant to Section 15
of the Securities Exchange Act of 1934.
----------
2/ Buyer must own and/or invest on a discretionary basis at least
$100,000,000 in securities unless Buyer is a dealer, and, in that case, Buyer
must own and/or invest on a discretionary basis at least $10,000,000 in
securities.
L-1-1
Insurance Company. The Buyer is an insurance company whose primary and
predominant business activity is the writing of insurance or the
reinsuring of risks underwritten by insurance companies and which is
subject to supervision by the insurance commissioner or a similar
official or agency of a State or territory or the District of
Columbia.
State or Local Plan. The Buyer is a plan established and maintained by
a State, its political subdivisions, or any agency or instrumentality
of the State or its political subdivisions, for the benefit of its
employees.
ERISA Plan. The Buyer is an employee benefit plan within the meaning
of Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended ("ERISA") and is subject to the fiduciary
responsibility provisions of ERISA.
Investment Adviser. The Buyer is an investment adviser registered
under the Investment Advisers Act of 1940.
SBIC. The Buyer is a Small Business Investment Company licensed by the
U.S. Small Business Administration under Section 301(c) or (d) of the
Small Business Investment Act of 1958.
Business Development Company. The Buyer is a business development
company as defined in Section 202(a)(22) of the Investment Advisers
Act of 1940.
Trust Fund. The Buyer is a trust fund whose trustee is a bank or trust
company and whose participants are exclusively (a) plans established
and maintained by a State, its political subdivision, or any agency or
instrumentality of the State or its political subdivision, for the
benefit of its employees, or (b) employee benefit plans within the
meaning of Title I of the Employee Retirement Income Security Act of
1974, but is not a trust fund that includes as participants individual
retirement accounts or H.R. 10 plans.
3. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Buyer, (ii) securities that are part of an
unsold allotment to or subscription by the Buyer, if the Buyer is a dealer,
(iii) bank deposit notes and certificates of deposit, (iv) loan participations,
(v) repurchase agreements, (vi) securities owned but subject to a repurchase
agreement and (vii) currency, interest rate and commodity swaps.
4. For purposes of determining the aggregate amount of securities owned
and/or invested on a discretionary basis by the Buyer, the Buyer used the cost
of such securities to the Buyer and did not include any of the securities
referred to in the preceding paragraph. Further, in determining such aggregate
amount, the Buyer may have included securities owned by subsidiaries of the
Buyer, but only if such subsidiaries are consolidated with the Buyer in its
financial statements prepared in accordance with generally accepted accounting
principles and if the investments of such subsidiaries are managed under the
Buyer's direction. However, such securities were not
L-1-2
included if the Buyer is a majority-owned, consolidated subsidiary of another
enterprise and the Buyer is not itself a reporting company under the Securities
Exchange Act of 1934.
5. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the Certificates
are relying and will continue to rely on the statements made herein because one
or more sales to the Buyer may be in reliance on Rule 144A.
Will the Buyer be purchasing the Rule 144A
Yes No Securities only for the Buyer's own account?
6. If the answer to the foregoing question is "no", the Buyer agrees that,
in connection with any purchase of securities sold to the Buyer for the account
of a third party (including any separate account) in reliance on Rule 144A, the
Buyer will only purchase for the account of a third party that at the time is a
"qualified institutional buyer" within the meaning of Rule 144A. In addition,
the Buyer agrees that the Buyer will not purchase securities for a third party
unless the Buyer has obtained a current representation letter from such third
party or taken other appropriate steps contemplated by Rule 144A to conclude
that such third party independently meets the definition of "qualified
institutional buyer" set forth in Rule 144A.
7. The Buyer will notify each of the parties to which this certification is
made of any changes in the information and conclusions herein. Until such notice
is given, the Buyer's purchase of Rule 144A Securities will constitute a
reaffirmation of this certification as of the date of such purchase.
Print Name of Buyer
By:________________________
Name:
Title:
Date:______________________
L-1-3
Annex 2 to Exhibit L
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Buyers That Are Registered Investment Companies]
The undersigned hereby certifies as follows in connection with the Rule
144A Investment Representation to which this Certification is attached:
1. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice- President of the Buyer or, if the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933 ("Rule 144A") because Buyer is a part of a Family of
Investment Companies (as defined below), is such an officer the Adviser.
2. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, and (ii)
as marked below, the Buyer alone, or the Buyer's Family of Investment Companies,
owned at least $100,000,000 in securities (other than the excluded securities
referred to below) as of the end of the Buyer's most recent fiscal year. For
purposes of determining the amount of securities owned by the Buyer or the
Buyer's Family of Investment Companies, the cost of such securities was used.
____ The Buyer owned $__________ in securities (other than the excluded
securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule
144A).
____ The Buyer is part of a Family of Investment Companies which owned in
the aggregate $__________ in securities (other than the excluded
securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule
144A).
3. The term "Family of Investment Companies" as used herein means two
or more registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser in a majority owned subsidiary of the other).
4. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer or are part of the
Buyer's Family of Investment Companies, (ii) bank deposit notes and certificates
of deposit, (iii) loan participations, (iv) repurchase agreements, (v)
securities owned but subject to a repurchase agreement and (vi) currency,
interest rate and commodity swaps.
L-2-1
5. The Buyer is familiar with Rule 144A and understands that each of
the parties to which this certification is made are relying and will continue to
rely on the statements made herein because one or more sales to the Buyer will
be reliance on Rule 144A. In addition, the Buyer will only purchase for the
Buyer's own account.
6. The undersigned will notify each of the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice, the Buyer's purchase of Rule 144A Securities will constitute
a reaffirmation of this certification by the undersigned as of the date of such
purchase.
_____________________________________________
Print Name of Buyer
By: _______________________________________
Name:
Title:
Date: ______________________________________
IF AN ADVISER
_____________________________________________
Print Name of Buyer
By: _________________________________________
Name:
Title:
Date: _______________________________________
(SEAL)
L-2-2
EXHIBIT M
PLANNED PRINCIPAL BALANCES
DISTRIBUTION DATE CLASS A-1 CLASS A-2 CLASS A-3 CLASS A-5
----------------- --------- --------- --------- ---------
Initial Balance................... $44,156,000.00 $33,167,750.00 $46,394,250.00 $12,669,000.00
January 25, 2003.................. 43,883,493.73 33,167,750.00 46,230,746.24 12,669,000.00
February 25, 2003................. 43,577,563.09 33,167,750.00 46,047,187.86 12,669,000.00
March 25, 2003.................... 43,238,326.64 33,167,750.00 45,843,645.98 12,669,000.00
April 25, 2003.................... 42,865,888.97 33,167,750.00 45,620,183.38 12,669,000.00
May 25, 2003...................... 42,460,371.93 33,167,750.00 45,376,873.16 12,669,000.00
June 25, 2003..................... 42,021,914.59 33,167,750.00 45,113,798.76 12,669,000.00
July 25, 2003..................... 41,550,673.16 33,167,750.00 44,831,053.90 12,669,000.00
August 25, 2003................... 41,046,820.96 33,167,750.00 44,528,742.58 12,669,000.00
September 25, 2003................ 40,510,548.28 33,167,750.00 44,206,978.97 12,669,000.00
October 25, 2003.................. 39,942,062.34 33,167,750.00 43,865,887.40 12,669,000.00
November 25, 2003................. 39,341,587.11 33,167,750.00 43,505,602.26 12,669,000.00
December 25, 2003................. 38,709,363.23 33,167,750.00 43,126,267.94 12,669,000.00
January 25, 2004.................. 38,045,647.84 33,167,750.00 42,728,038.70 12,669,000.00
February 25, 2004................. 37,350,714.44 33,167,750.00 42,311,078.66 12,669,000.00
March 25, 2004.................... 36,624,852.68 33,167,750.00 41,875,561.61 12,669,000.00
April 25, 2004.................... 35,868,368.21 33,167,750.00 41,421,670.93 12,669,000.00
May 25, 2004...................... 35,081,582.46 33,167,750.00 40,949,599.48 12,669,000.00
June 25, 2004..................... 34,264,832.42 33,167,750.00 40,459,549.45 12,669,000.00
July 25, 2004..................... 33,418,470.41 33,167,750.00 39,951,732.24 12,669,000.00
August 25, 2004................... 32,542,863.84 33,167,750.00 39,426,368.30 12,669,000.00
September 25, 2004................ 31,638,394.97 33,167,750.00 38,883,686.98 12,669,000.00
October 25, 2004.................. 30,705,460.60 33,167,750.00 38,323,926.36 12,669,000.00
November 25, 2004................. 29,744,471.82 33,167,750.00 37,747,333.09 12,669,000.00
December 25, 2004................. 28,755,853.71 33,167,750.00 37,154,162.22 12,669,000.00
January 25, 2005.................. 27,740,045.01 33,167,750.00 36,544,677.00 12,669,000.00
February 25, 2005................. 26,697,497.82 33,167,750.00 35,919,148.69 12,669,000.00
March 25, 2005.................... 25,628,677.27 33,167,750.00 35,277,856.36 12,669,000.00
April 25, 2005.................... 24,534,061.16 33,167,750.00 34,621,086.70 12,669,000.00
May 25, 2005...................... 23,445,085.94 33,167,750.00 33,967,701.57 12,669,000.00
June25,2005....................... 22,361,722.92 33,167,750.00 33,317,683.76 12,669,000.00
July 25, 2005..................... 21,283,943.56 33,167,750.00 32,671,016.14 12,669,000.00
August 25, 2005................... 20,211,719.48 33,167,750.00 32,027,681.69 12,669,000.00
September 25, 2005................ 19,145,022.44 33,167,750.00 31,387,663.46 12,669,000.00
October 25, 2005.................. 18,083,824.33 33,167,750.00 30,750,944.60 12,669,000.00
November 25, 2005................. 17,028,097.23 33,167,750.00 30,117,508.34 12,669,000.00
December 25, 2005................. 15,977,813.32 33,167,750.00 29,487,337.99 12,669,000.00
January 25, 2006.................. 14,932,944.96 33,167,750.00 28,860,416.98 12,669,000.00
February 25, 2006................. 13,893,464.63 33,167,750.00 28,236,728.78 12,669,000.00
March 25, 2006.................... 12,859,344.96 33,167,750.00 27,616,256.98 12,669,000.00
April 25, 2006.................... 11,830,558.73 33,167,750.00 26,998,985.24 12,669,000.00
May 25, 2006...................... 10,807,078.86 33,167,750.00 26,384,897.32 12,669,000.00
June 25, 2006..................... 9,788,878.40 33,167,750.00 25,773,977.04 12,669,000.00
July 25, 2006..................... 8,775,930.55 33,167,750.00 25,166,208.33 12,669,000.00
August 25, 2006................... 7,768,208.66 33,167,750.00 24,561,575.19 12,669,000.00
September 25, 2006................ 6,765,686.19 33,167,750.00 23,960,061.71 12,669,000.00
October 25, 2006.................. 5,768,336.76 33,167,750.00 23,361,652.06 12,669,000.00
M-1
DISTRIBUTION DATE CLASS A-1 CLASS A-2 CLASS A-3 CLASS A-5
----------------- --------- --------- --------- ---------
November 25, 2006................. 4,776,134.14 33,167,750.00 22,766,330.49 12,669,000.00
December 25, 2006................. 3,789,052.21 33,167,750.00 22,174,081.32 12,669,000.00
January 25, 2007.................. 2,807,064.99 33,167,750.00 21,584,888.99 12,669,000.00
February 25, 2007................. 1,830,146.65 33,167,750.00 20,998,737.99 12,669,000.00
March 25, 2007.................... 858,271.49 33,167,750.00 20,415,612.89 12,669,000.00
April 25, 2007.................... 0.00 33,059,163.94 19,835,498.36 12,669,000.00
May 25, 2007...................... 0.00 32,097,298.56 19,258,379.14 12,669,000.00
June 25, 2007..................... 0.00 31,140,400.06 18,684,240.03 12,669,000.00
July 25, 2007..................... 0.00 30,188,443.26 18,113,065.95 12,669,000.00
August 25, 2007................... 0.00 29,241,403.12 17,544,841.88 12,669,000.00
September 25, 2007................ 0.00 28,299,254.75 16,979,552.85 12,669,000.00
October 25, 2007.................. 0.00 27,361,973.36 16,417,184.02 12,669,000.00
November 25, 2007................. 0.00 26,429,534.31 15,857,720.59 12,669,000.00
December 25, 2007................. 0.00 25,501,913.07 15,301,147.85 12,669,000.00
January 25, 2008.................. 0.00 24,626,723.37 14,776,034.02 12,669,000.00
February 25, 2008................. 0.00 23,756,247.41 14,253,748.45 12,669,000.00
March 25, 2008.................... 0.00 22,890,461.25 13,734,276.75 12,669,000.00
April 25, 2008.................... 0.00 22,029,341.04 13,217,604.63 12,669,000.00
May 25, 2008...................... 0.00 21,172,863.08 12,703,717.85 12,669,000.00
June 25, 2008..................... 0.00 20,321,003.79 12,192,602.27 12,669,000.00
July 25, 2008..................... 0.00 19,473,739.69 11,684,243.82 12,669,000.00
August 25, 2008................... 0.00 18,631,047.48 11,178,628.49 12,669,000.00
September 25, 2008................ 0.00 17,792,903.92 10,675,742.35 12,669,000.00
October 25, 2008.................. 0.00 16,959,285.94 10,175,571.57 12,669,000.00
November 25, 2008................. 0.00 16,130,170.59 9,678,102.35 12,669,000.00
December 25, 2008................. 0.00 15,305,535.00 9,183,321.00 12,669,000.00
January 25, 2009.................. 0.00 14,501,064.47 8,700,638.68 12,669,000.00
February 25, 2009................. 0.00 13,700,970.79 8,220,582.47 12,669,000.00
March 25, 2009.................... 0.00 12,905,231.59 7,743,138.95 12,669,000.00
April 25, 2009.................... 0.00 12,113,824.62 7,268,294.77 12,669,000.00
May 25, 2009...................... 0.00 11,326,727.75 6,796,036.65 12,669,000.00
June 25, 2009..................... 0.00 10,545,424.90 6,327,254.94 12,669,000.00
July 25, 2009..................... 0.00 9,785,771.51 5,871,462.91 12,669,000.00
August 25, 2009................... 0.00 9,047,232.21 5,428,339.32 12,669,000.00
September 25, 2009................ 0.00 8,329,284.28 4,997,570.57 12,669,000.00
October 25, 2009.................. 0.00 7,631,417.43 4,578,850.46 12,669,000.00
November 25, 2009................. 0.00 6,953,133.42 4,171,880.06 12,669,000.00
December 25, 2009................. 0.00 6,293,945.86 3,776,367.52 12,669,000.00
January 25, 2010.................. 0.00 5,752,331.76 3,451,399.05 12,669,000.00
February 25, 2010................. 0.00 5,226,487.89 3,135,892.73 12,669,000.00
March 25, 2010.................... 0.00 4,716,003.86 2,829,602.31 12,669,000.00
April 25, 2010.................... 0.00 4,220,479.34 2,532,287.60 12,669,000.00
May 25, 2010...................... 0.00 3,739,523.85 2,243,714.31 12,669,000.00
June 25, 2010..................... 0.00 3,272,756.55 1,963,653.93 12,669,000.00
July 25, 2010..................... 0.00 2,819,805.96 1,691,883.58 12,669,000.00
August 25, 2010................... 0.00 2,380,309.79 1,428,185.88 12,669,000.00
September 25, 2010................ 0.00 1,953,914.68 1,172,348.81 12,669,000.00
October 25, 2010.................. 0.00 1,540,275.99 924,165.59 12,669,000.00
November 25, 2010................. 0.00 1,139,057.62 683,434.57 12,669,000.00
December 25, 2010................. 0.00 749,931.79 449,959.07 12,669,000.00
January 25, 2011.................. 0.00 455,832.39 273,499.43 12,669,000.00
February 25, 2011................. 0.00 170,375.37 102,225.22 12,669,000.00
March 25, 2011.................... 0.00 0.00 0.00 12,498,322.86
M-2
DISTRIBUTION DATE CLASS A-1 CLASS A-2 CLASS A-3 CLASS A-5
----------------- --------- --------- --------- ---------
April 25, 2011.................... 0.00 0.00 0.00 12,068,133.91
May 25, 2011...................... 0.00 0.00 0.00 11,650,678.45
June 25, 2011..................... 0.00 0.00 0.00 11,245,610.30
July 25, 2011..................... 0.00 0.00 0.00 10,852,592.23
August 25, 2011................... 0.00 0.00 0.00 10,471,295.70
September 25, 2011................ 0.00 0.00 0.00 10,101,400.68
October 25, 2011.................. 0.00 0.00 0.00 9,742,595.38
November 25, 2011................. 0.00 0.00 0.00 9,394,576.09
December 25, 2011................. 0.00 0.00 0.00 9,057,046.99
January 25, 2012.................. 0.00 0.00 0.00 8,835,326.99
February 25, 2012................. 0.00 0.00 0.00 8,618,913.02
March 25, 2012.................... 0.00 0.00 0.00 8,407,680.03
April 25, 2012.................... 0.00 0.00 0.00 8,201,505.92
May 25, 2012...................... 0.00 0.00 0.00 8,000,271.41
June 25, 2012..................... 0.00 0.00 0.00 7,803,860.00
July 25, 2012..................... 0.00 0.00 0.00 7,612,157.92
August 25, 2012................... 0.00 0.00 0.00 7,425,054.05
September 25, 2012................ 0.00 0.00 0.00 7,242,439.86
October 25, 2012.................. 0.00 0.00 0.00 7,064,209.35
November 25, 2012................. 0.00 0.00 0.00 6,890,259.01
December 25, 2012................. 0.00 0.00 0.00 6,720,487.73
January 25, 2013.................. 0.00 0.00 0.00 6,554,796.76
February 25, 2013................. 0.00 0.00 0.00 6,393,089.67
March 25, 2013.................... 0.00 0.00 0.00 6,235,272.27
April 25, 2013.................... 0.00 0.00 0.00 6,081,252.58
May 25, 2013...................... 0.00 0.00 0.00 5,930,940.77
June 25, 2013..................... 0.00 0.00 0.00 5,784,249.09
July 25, 2013..................... 0.00 0.00 0.00 5,641,091.87
August 25, 2013................... 0.00 0.00 0.00 5,501,385.43
September 25, 2013................ 0.00 0.00 0.00 5,365,048.04
October 25, 2013.................. 0.00 0.00 0.00 5,231,999.89
November 25, 2013................. 0.00 0.00 0.00 5,102,163.04
December 25, 2013................. 0.00 0.00 0.00 4,975,461.37
January 25, 2014.................. 0.00 0.00 0.00 4,851,820.53
February 25, 2014................. 0.00 0.00 0.00 4,731,167.95
March 25, 2014.................... 0.00 0.00 0.00 4,613,432.71
April 25, 2014.................... 0.00 0.00 0.00 4,498,545.57
May 25, 2014...................... 0.00 0.00 0.00 4,386,438.94
June 25, 2014..................... 0.00 0.00 0.00 4,277,046.76
July 25, 2014..................... 0.00 0.00 0.00 4,170,304.57
August 25, 2014................... 0.00 0.00 0.00 4,066,149.40
September 25, 2014................ 0.00 0.00 0.00 3,964,519.74
October 25, 2014.................. 0.00 0.00 0.00 3,865,355.54
November 25, 2014................. 0.00 0.00 0.00 3,768,598.17
December 25, 2014................. 0.00 0.00 0.00 3,674,190.36
January 25, 2015.................. 0.00 0.00 0.00 3,582,076.18
February 25, 2015................. 0.00 0.00 0.00 3,492,201.02
March 25, 2015.................... 0.00 0.00 0.00 3,404,511.56
April 25, 2015.................... 0.00 0.00 0.00 3,318,955.71
May 25, 2015...................... 0.00 0.00 0.00 3,235,482.64
June 25, 2015..................... 0.00 0.00 0.00 3,154,042.67
July 25, 2015..................... 0.00 0.00 0.00 3,074,587.33
August 25, 2015................... 0.00 0.00 0.00 2,997,069.26
M-3
DISTRIBUTION DATE CLASS A-1 CLASS A-2 CLASS A-3 CLASS A-5
----------------- --------- --------- --------- ---------
September 25, 2015................ 0.00 0.00 0.00 2,921,442.22
October 25, 2015.................. 0.00 0.00 0.00 2,847,661.07
November 25, 2015................. 0.00 0.00 0.00 2,775,681.72
December 25, 2015................. 0.00 0.00 0.00 2,705,461.12
January 25, 2016.................. 0.00 0.00 0.00 2,636,957.23
February 25, 2016................. 0.00 0.00 0.00 2,570,129.01
March 25, 2016.................... 0.00 0.00 0.00 2,504,936.38
April 25, 2016.................... 0.00 0.00 0.00 2,441,340.20
May 25, 2016...................... 0.00 0.00 0.00 2,379,302.26
June 25, 2016..................... 0.00 0.00 0.00 2,318,785.24
July 25, 2016..................... 0.00 0.00 0.00 2,259,752.72
August 25, 2016................... 0.00 0.00 0.00 2,202,169.12
September 25, 2016................ 0.00 0.00 0.00 2,145,999.71
October 25, 2016.................. 0.00 0.00 0.00 2,091,210.56
November 25, 2016................. 0.00 0.00 0.00 2,037,768.56
December 25, 2016................. 0.00 0.00 0.00 1,985,641.39
January 25, 2017.................. 0.00 0.00 0.00 1,934,797.47
February 25, 2017................. 0.00 0.00 0.00 1,885,205.97
March 25, 2017.................... 0.00 0.00 0.00 1,836,836.81
April 25, 2017.................... 0.00 0.00 0.00 1,789,660.59
May 25, 2017...................... 0.00 0.00 0.00 1,743,648.62
June 25, 2017..................... 0.00 0.00 0.00 1,698,772.90
July 25, 2017..................... 0.00 0.00 0.00 1,655,006.08
August 25, 2017................... 0.00 0.00 0.00 1,612,321.45
September 25, 2017................ 0.00 0.00 0.00 1,570,692.94
October 25, 2017.................. 0.00 0.00 0.00 1,530,095.10
November 25, 2017................. 0.00 0.00 0.00 1,490,503.08
December 25, 2017................. 0.00 0.00 0.00 1,451,892.62
January 25, 2018.................. 0.00 0.00 0.00 1,414,240.03
February 25, 2018................. 0.00 0.00 0.00 1,377,522.18
March 25, 2018.................... 0.00 0.00 0.00 1,341,716.50
April 25, 2018.................... 0.00 0.00 0.00 1,306,800.95
May 25, 2018...................... 0.00 0.00 0.00 1,272,754.00
June 25, 2018..................... 0.00 0.00 0.00 1,239,554.66
July 25, 2018..................... 0.00 0.00 0.00 1,207,182.40
August 25, 2018................... 0.00 0.00 0.00 1,175,617.21
September 25, 2018................ 0.00 0.00 0.00 1,144,839.54
October 25, 2018.................. 0.00 0.00 0.00 1,114,830.30
November 25, 2018................. 0.00 0.00 0.00 1,085,570.88
December 25, 2018................. 0.00 0.00 0.00 1,057,043.08
January 25, 2019.................. 0.00 0.00 0.00 1,029,229.14
February 25, 2019................. 0.00 0.00 0.00 1,002,111.74
March 25, 2019.................... 0.00 0.00 0.00 975,673.96
April 25, 2019.................... 0.00 0.00 0.00 949,899.28
May 25, 2019...................... 0.00 0.00 0.00 924,771.58
June 25, 2019..................... 0.00 0.00 0.00 900,275.12
July 25, 2019..................... 0.00 0.00 0.00 876,394.54
August 25, 2019................... 0.00 0.00 0.00 853,114.84
September 25, 2019................ 0.00 0.00 0.00 830,421.38
October 25, 2019.................. 0.00 0.00 0.00 808,299.87
November 25, 2019................. 0.00 0.00 0.00 786,736.35
M-4
DISTRIBUTION DATE CLASS A-1 CLASS A-2 CLASS A-3 CLASS A-5
----------------- --------- --------- --------- ---------
December 25, 2019................. 0.00 0.00 0.00 765,717.22
January 25, 2020.................. 0.00 0.00 0.00 745,229.19
February 25, 2020................. 0.00 0.00 0.00 725,259.27
March 25, 2020.................... 0.00 0.00 0.00 705,794.80
April 25, 2020.................... 0.00 0.00 0.00 686,823.43
May 25, 2020...................... 0.00 0.00 0.00 668,333.09
June 25, 2020..................... 0.00 0.00 0.00 650,312.00
July 25, 2020..................... 0.00 0.00 0.00 632,748.66
August 25, 2020................... 0.00 0.00 0.00 615,631.86
September 25, 2020................ 0.00 0.00 0.00 598,950.65
October 25, 2020.................. 0.00 0.00 0.00 582,694.34
November 25, 2020................. 0.00 0.00 0.00 566,852.48
December 25, 2020................. 0.00 0.00 0.00 551,414.92
January 25, 2021.................. 0.00 0.00 0.00 536,371.69
February 25, 2021................. 0.00 0.00 0.00 521,713.11
March 25, 2021.................... 0.00 0.00 0.00 507,429.71
April 25, 2021.................... 0.00 0.00 0.00 493,512.25
May 25, 2021...................... 0.00 0.00 0.00 479,951.71
June 25, 2021..................... 0.00 0.00 0.00 466,739.29
July 25, 2021..................... 0.00 0.00 0.00 453,866.40
August 25, 2021................... 0.00 0.00 0.00 441,324.66
September 25, 2021................ 0.00 0.00 0.00 429,105.89
October 25, 2021.................. 0.00 0.00 0.00 417,202.11
November 25, 2021................. 0.00 0.00 0.00 405,605.52
December 25, 2021................. 0.00 0.00 0.00 394,308.52
January 25, 2022.................. 0.00 0.00 0.00 383,303.69
February 25, 2022................. 0.00 0.00 0.00 372,583.79
March 25, 2022.................... 0.00 0.00 0.00 362,141.75
April 25, 2022.................... 0.00 0.00 0.00 351,970.68
May 25, 2022...................... 0.00 0.00 0.00 342,063.85
June 25, 2022..................... 0.00 0.00 0.00 332,414.68
July 25, 2022..................... 0.00 0.00 0.00 323,016.77
August 25, 2022................... 0.00 0.00 0.00 313,863.88
September 25, 2022................ 0.00 0.00 0.00 304,949.88
October 25, 2022.................. 0.00 0.00 0.00 296,268.84
November 25, 2022................. 0.00 0.00 0.00 287,814.94
December 25, 2022................. 0.00 0.00 0.00 279,582.52
January 25, 2023.................. 0.00 0.00 0.00 271,566.03
February 25, 2023................. 0.00 0.00 0.00 263,760.08
March 25, 2023.................... 0.00 0.00 0.00 256,159.41
April 25, 2023.................... 0.00 0.00 0.00 248,758.88
May 25, 2023...................... 0.00 0.00 0.00 241,553.47
June 25, 2023..................... 0.00 0.00 0.00 234,538.29
July 25, 2023..................... 0.00 0.00 0.00 227,708.56
August 25, 2023................... 0.00 0.00 0.00 221,059.63
September 25, 2023................ 0.00 0.00 0.00 214,586.96
October 25, 2023.................. 0.00 0.00 0.00 208,286.11
November 25, 2023................. 0.00 0.00 0.00 202,152.76
December 25, 2023................. 0.00 0.00 0.00 196,182.68
January 25, 2024.................. 0.00 0.00 0.00 190,371.76
M-5
DISTRIBUTION DATE CLASS A-1 CLASS A-2 CLASS A-3 CLASS A-5
----------------- --------- --------- --------- ---------
February 25, 2024................. 0.00 0.00 0.00 184,715.99
March 25, 2024.................... 0.00 0.00 0.00 179,211.43
April 25, 2024.................... 0.00 0.00 0.00 173,854.28
May 25, 2024...................... 0.00 0.00 0.00 168,640.80
June 25, 2024..................... 0.00 0.00 0.00 163,567.36
July 25, 2024..................... 0.00 0.00 0.00 158,630.39
August 25, 2024................... 0.00 0.00 0.00 153,826.45
September 25, 2024................ 0.00 0.00 0.00 149,152.15
October 25, 2024.................. 0.00 0.00 0.00 144,604.21
November 25, 2024................. 0.00 0.00 0.00 140,179.39
December 25, 2024................. 0.00 0.00 0.00 135,874.58
January 25, 2025.................. 0.00 0.00 0.00 131,686.71
February 25, 2025................. 0.00 0.00 0.00 127,612.79
March 25, 2025.................... 0.00 0.00 0.00 123,649.93
April 25, 2025.................... 0.00 0.00 0.00 119,795.27
May 25, 2025...................... 0.00 0.00 0.00 116,046.06
June 25, 2025..................... 0.00 0.00 0.00 112,399.58
July 25, 2025..................... 0.00 0.00 0.00 108,853.22
August 25, 2025................... 0.00 0.00 0.00 105,404.39
September 25, 2025................ 0.00 0.00 0.00 102,050.60
October 25, 2025.................. 0.00 0.00 0.00 98,789.40
November 25, 2025................. 0.00 0.00 0.00 95,618.40
December 25, 2025................. 0.00 0.00 0.00 92,535.29
January 25, 2026.................. 0.00 0.00 0.00 89,537.79
February 25, 2026................. 0.00 0.00 0.00 86,623.70
March 25, 2026.................... 0.00 0.00 0.00 83,790.85
April 25, 2026.................... 0.00 0.00 0.00 81,037.15
May 25, 2026...................... 0.00 0.00 0.00 78,360.55
June 25, 2026..................... 0.00 0.00 0.00 75,759.04
July 25, 2026..................... 0.00 0.00 0.00 73,230.68
August 25, 2026................... 0.00 0.00 0.00 70,773.56
September 25, 2026................ 0.00 0.00 0.00 68,385.83
October 25, 2026.................. 0.00 0.00 0.00 66,065.68
November 25, 2026................. 0.00 0.00 0.00 63,811.35
December 25, 2026................. 0.00 0.00 0.00 61,621.12
January 25, 2027.................. 0.00 0.00 0.00 59,493.31
February 25, 2027................. 0.00 0.00 0.00 57,426.29
March 25, 2027.................... 0.00 0.00 0.00 55,418.47
April 25, 2027.................... 0.00 0.00 0.00 53,468.29
May 25, 2027...................... 0.00 0.00 0.00 51,574.23
June 25, 2027..................... 0.00 0.00 0.00 49,734.82
July 25, 2027..................... 0.00 0.00 0.00 47,948.62
August 25, 2027................... 0.00 0.00 0.00 46,214.23
September 25, 2027................ 0.00 0.00 0.00 44,530.27
October 25, 2027.................. 0.00 0.00 0.00 42,895.42
November 25, 2027................. 0.00 0.00 0.00 41,308.36
December 25, 2027................. 0.00 0.00 0.00 39,767.84
January 25, 2028.................. 0.00 0.00 0.00 38,272.61
February 25, 2028................. 0.00 0.00 0.00 36,821.48
March 25, 2028.................... 0.00 0.00 0.00 35,413.26
M-6
DISTRIBUTION DATE CLASS A-1 CLASS A-2 CLASS A-3 CLASS A-5
----------------- --------- --------- --------- ---------
April 25, 2028.................... 0.00 0.00 0.00 34,046.81
May 25, 2028...................... 0.00 0.00 0.00 32,721.02
June 25, 2028..................... 0.00 0.00 0.00 31,434.80
July 25, 2028..................... 0.00 0.00 0.00 30,187.08
August 25, 2028................... 0.00 0.00 0.00 28,976.84
September 25, 2028................ 0.00 0.00 0.00 27,803.06
October 25, 2028.................. 0.00 0.00 0.00 26,664.77
November 25, 2028................. 0.00 0.00 0.00 25,561.00
December 25, 2028................. 0.00 0.00 0.00 24,490.83
January 25, 2029.................. 0.00 0.00 0.00 23,453.34
February 25, 2029................. 0.00 0.00 0.00 22,447.65
March 25, 2029.................... 0.00 0.00 0.00 21,472.90
April 25, 2029.................... 0.00 0.00 0.00 20,528.24
May 25, 2029...................... 0.00 0.00 0.00 19,612.86
June 25, 2029..................... 0.00 0.00 0.00 18,725.96
July 25, 2029..................... 0.00 0.00 0.00 17,866.75
August 25, 2029................... 0.00 0.00 0.00 17,034.49
September 25, 2029................ 0.00 0.00 0.00 16,228.42
October 25, 2029.................. 0.00 0.00 0.00 15,447.84
November 25, 2029................. 0.00 0.00 0.00 14,692.03
December 25, 2029................. 0.00 0.00 0.00 13,960.32
January 25, 2030.................. 0.00 0.00 0.00 13,252.04
February 25, 2030................. 0.00 0.00 0.00 12,566.54
March 25, 2030.................... 0.00 0.00 0.00 11,903.19
April 25, 2030.................... 0.00 0.00 0.00 11,261.37
May 25, 2030...................... 0.00 0.00 0.00 10,640.48
June 25, 2030..................... 0.00 0.00 0.00 10,039.95
July 25, 2030..................... 0.00 0.00 0.00 9,459.19
August 25, 2030................... 0.00 0.00 0.00 8,897.66
September 25, 2030................ 0.00 0.00 0.00 8,354.81
October 25, 2030.................. 0.00 0.00 0.00 7,830.12
November 25, 2030................. 0.00 0.00 0.00 7,323.08
December 25, 2030................. 0.00 0.00 0.00 6,833.19
January 25, 2031.................. 0.00 0.00 0.00 6,359.95
February 25, 2031................. 0.00 0.00 0.00 5,902.91
March 25, 2031.................... 0.00 0.00 0.00 5,461.59
April 25, 2031.................... 0.00 0.00 0.00 5,035.56
May 25, 2031...................... 0.00 0.00 0.00 4,624.36
June 25, 2031..................... 0.00 0.00 0.00 4,227.58
July 25, 2031..................... 0.00 0.00 0.00 3,844.80
August 25, 2031................... 0.00 0.00 0.00 3,475.62
September 25, 2031................ 0.00 0.00 0.00 3,119.64
October 25, 2031.................. 0.00 0.00 0.00 2,776.49
November 25, 2031................. 0.00 0.00 0.00 2,445.79
December 25, 2031................. 0.00 0.00 0.00 2,127.17
January 25, 2032.................. 0.00 0.00 0.00 1,820.29
February 25, 2032................. 0.00 0.00 0.00 1,524.80
March 25, 2032.................... 0.00 0.00 0.00 1,240.36
April 25, 2032.................... 0.00 0.00 0.00 966.66
May 25, 2032 ..................... 0.00 0.00 0.00 703.37
M-7
DISTRIBUTION DATE CLASS A-1 CLASS A-2 CLASS A-3 CLASS A-5
----------------- --------- --------- --------- ---------
June 25, 2032..................... 0.00 0.00 0.00 450.18
July 25, 2032..................... 0.00 0.00 0.00 206.80
August 25, 2032 thereafter........ 0.00 0.00 0.00 0.00
M-8
EXHIBIT N
TARGETED PRINCIPAL BALANCES
DISTRIBUTION DATE CLASS A-6 CLASS A-7
----------------- --------- ---------
Initial Balance........................... $55,000,000.00 $1,000.00
January 25, 2003.......................... 54,889,949.57 1,000.00
February 25, 2003......................... 54,743,285.90 1,000.00
March 25, 2003............................ 54,560,111.73 1,000.00
April 25, 2003............................ 54,340,580.50 1,000.00
May 25, 2003.............................. 54,084,896.46 1,000.00
June 25, 2003............................. 53,793,314.60 1,000.00
July 25, 2003............................. 53,466,140.52 1,000.00
August 25, 2003 .......................... 53,103,730.15 1,000.00
September 25, 2003........................ 52,706,489.52 1,000.00
October 25, 2003.......................... 52,274,874.24 1,000.00
November 25, 2003......................... 51,809,389.10 1,000.00
December 25, 2003......................... 51,310,587.44 1,000.00
January 25, 2004.......................... 50,779,070.42 1,000.00
February 25, 2004......................... 50,215,486.34 1,000.00
March 25, 2004............................ 49,620,529.72 1,000.00
April 25, 2004............................ 48,994,940.42 1,000.00
May 25, 2004.............................. 48,339,502.52 1,000.00
June 25, 2004............................. 47,655,043.30 1,000.00
July 25, 2004............................. 46,942,432.01 1,000.00
August 25, 2004 .......................... 46,202,578.60 1,000.00
September 25, 2004........................ 45,436,432.36 1,000.00
October 25, 2004.......................... 44,644,980.53 1,000.00
November 25, 2004......................... 43,829,246.80 1,000.00
December 25, 2004......................... 42,990,289.67 1,000.00
January 25, 2005.......................... 42,129,200.93 1,000.00
February 25, 2005......................... 41,247,103.89 1,000.00
March 25, 2005............................ 40,345,151.64 1,000.00
April 25, 2005............................ 39,424,525.25 1,000.00
May 25, 2005.............................. 38,519,886.97 1,000.00
June 25, 2005............................. 37,631,056.56 1,000.00
July 25, 2005............................. 36,757,855.57 1,000.00
August 25, 2005 .......................... 35,900,107.30 1,000.00
September 25, 2005........................ 35,057,636.85 1,000.00
October 25, 2005.......................... 34,230,271.05 1,000.00
November 25, 2005......................... 33,417,838.45 1,000.00
December 25, 2005......................... 32,620,169.33 1,000.00
January 25, 2006.......................... 31,837,095.67 1,000.00
February 25, 2006......................... 31,068,451.10 1,000.00
March 25, 2006............................ 30,314,070.95 1,000.00
April 25, 2006............................ 29,573,792.18 1,000.00
May 25, 2006.............................. 28,847,453.37 1,000.00
June 25, 2006............................. 28,134,894.78 1,000.00
July 25, 2006............................. 27,435,958.19 1,000.00
August 25, 2006........................... 26,750,487.02 1,000.00
N-1
DISTRIBUTION DATE CLASS A-6 CLASS A-7
----------------- --------- ---------
September 25, 2006........................ 26,078,326.25 1,000.00
October 25, 2006.......................... 25,419,322.42 1,000.00
November 25, 2006......................... 24,773,323.58 1,000.00
December 25, 2006......................... 24,140,179.38 1,000.00
January 25, 2007.......................... 23,519,740.92 1,000.00
February 25, 2007......................... 22,911,860.81 1,000.00
March 25, 2007............................ 22,316,393.17 1,000.00
April 25, 2007............................ 21,733,193.57 1,000.00
May 25, 2007.............................. 21,162,119.04 1,000.00
June 25, 2007............................. 20,603,028.06 1,000.00
July 25, 2007............................. 20,055,780.54 1,000.00
August 25, 2007........................... 19,520,237.78 1,000.00
September 25, 2007........................ 18,996,262.53 1,000.00
October 25, 2007.......................... 18,483,718.87 1,000.00
November 25, 2007......................... 17,982,472.31 1,000.00
December 25, 2007......................... 17,492,389.71 1,000.00
January 25, 2008.......................... 17,059,609.91 1,000.00
February 25, 2008......................... 16,637,480.23 1,000.00
March 25, 2008............................ 16,225,872.01 1,000.00
April 25, 2008............................ 15,824,657.92 1,000.00
May 25, 2008.............................. 15,433,711.90 1,000.00
June 25, 2008............................. 15,052,909.19 1,000.00
July 25, 2008............................. 14,682,126.29 1,000.00
August 25, 2008........................... 14,321,240.97 1,000.00
September 25, 2008........................ 13,970,132.24 1,000.00
October 25, 2008.......................... 13,628,680.34 1,000.00
November 25, 2008......................... 13,296,766.72 1,000.00
December 25, 2008......................... 12,974,274.10 1,000.00
January 25, 2009.......................... 12,675,567.89 1,000.00
February 25, 2009......................... 12,385,873.44 1,000.00
March 25, 2009............................ 12,105,077.92 1,000.00
April 25, 2009............................ 11,833,069.67 1,000.00
May 25, 2009.............................. 11,569,738.18 1,000.00
June 25, 2009............................. 11,312,564.58 1,000.00
July 25, 2009............................. 11,036,036.88 1,000.00
August 25, 2009........................... 10,740,869.73 1,000.00
September 25, 2009........................ 10,427,758.75 1,000.00
October 25, 2009.......................... 10,097,381.04 1,000.00
November 25, 2009......................... 9,750,395.63 1,000.00
December 25, 2009......................... 9,387,443.88 1,000.00
January 25, 2010.......................... 8,926,782.90 1,000.00
February 25, 2010......................... 8,454,453.03 1,000.00
March 25, 2010............................ 7,970,982.50 1,000.00
April 25, 2010............................ 7,476,884.63 1,000.00
May 25, 2010.............................. 6,972,658.14 1,000.00
June 25, 2010............................. 6,458,787.50 1,000.00
July 25, 2010............................. 5,935,743.33 1,000.00
August 25, 2010........................... 5,403,982.73 1,000.00
September 25, 2010........................ 4,863,949.60 1,000.00
October 25, 2010.......................... 4,316,075.03 1,000.00
N-2
November 25, 2010......................... 3,760,777.53 1,000.00
December 25, 2010......................... 3,198,463.43 1,000.00
January 25, 2011.......................... 2,567,368.74 1,000.00
February 25, 2011......................... 1,933,538.95 1,000.00
March 25, 2011............................ 1,297,242.82 1,000.00
April 25, 2011............................ 658,740.49 1,000.00
May 25, 2011.............................. 18,283.66 1,000.00
June 25, 2011 and thereafter.............. 0.00 0.00
N-3
