EXHIBIT 4.1
AMERICAN HOME MORTGAGE INVESTMENT TRUST 2004-1
Issuer
and
XXXXX FARGO BANK, NATIONAL ASSOCIATION
Indenture Trustee
____________________________________
INDENTURE
Dated as of March 31, 2004
____________________________________
MORTGAGE-BACKED NOTES
________________
TABLE OF CONTENTS
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Section Page
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ARTICLE I
Definitions
Section 1.01 Definitions................................................2
Section 1.02 Incorporation by Reference of Trust Indenture Act..........2
Section 1.03 Rules of Construction......................................2
Notes
Section 2.01 Form.......................................................4
Section 2.02 Execution, Authentication and Delivery.....................4
Section 2.03 Acceptance of Mortgage Loans by Indenture Trustee..........5
Covenants
Section 3.01 Collection of Payments with respect to the Mortgage Loans..7
Section 3.02 Maintenance of Office or Agency............................7
Section 3.03 Money for Payments To Be Held in Trust; Paying Agent.......7
Section 3.04 Existence..................................................8
Section 3.05 Payment of Principal and Interest..........................9
Section 3.06 Protection of Trust Estate................................15
Section 3.07 Opinions as to Trust Estate...............................15
Section 3.08 Performance of Obligations................................16
Section 3.09 Negative Covenants........................................16
Section 3.10 Annual Statement as to Compliance.........................17
Section 3.11 [Reserved]................................................17
Section 3.12 Representations and Warranties Concerning the
Mortgage Loans............................................17
Section 3.13 Amendments to Servicing Agreement.........................17
Section 3.14 Master Servicer as Agent and Bailee of the Indenture
Trustee...................................................17
Section 3.15 Investment Company Act....................................18
Section 3.16 Issuer May Consolidate, etc...............................18
Section 3.17 Successor or Transferee...................................20
Section 3.18 No Other Business.........................................20
Section 3.19 No Borrowing..............................................20
Section 3.20 Guarantees, Loans, Advances and Other Liabilities.........20
Section 3.21 Capital Expenditures......................................20
Section 3.22 Determination of Note Interest Rate.......................20
Section 3.23 Restricted Payments.......................................21
Section 3.24 Notice of Events of Default...............................21
Section 3.25 Further Instruments and Acts..............................21
Section 3.26 Statements to Noteholders.................................21
Section 3.27 [Reserved]................................................21
Section 3.28 Certain Representations Regarding the Trust Estate........21
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Section 3.29 Allocation of Realized Losses.............................23
The Notes; Satisfaction and Discharge of Indenture
Section 4.01 The Notes.................................................24
Section 4.02 Registration of and Limitations on Transfer and
Exchange of Notes; Appointment of Note Registrar and
Certificate Registrar.....................................24
Section 4.03 Mutilated, Destroyed, Lost or Stolen Notes................25
Section 4.04 Persons Deemed Owners.....................................26
Section 4.05 Cancellation..............................................26
Section 4.06 Book-Entry Notes..........................................26
Section 4.07 Notices to Depository.....................................27
Section 4.08 Definitive Notes..........................................27
Section 4.09 Tax Treatment.............................................28
Section 4.10 Satisfaction and Discharge of Indenture...................28
Section 4.11 Application of Trust Money................................29
Section 4.12 [Reserved.................................................29
Section 4.13 Repayment of Monies Held by Paying Agent..................29
Section 4.14 Temporary Notes...........................................29
Section 4.15 Representation Regarding ERISA............................30
ARTICLE V
Default and Remedies
Section 5.01 Events of Default.........................................31
Section 5.02 Acceleration of Maturity; Rescission and Annulment........31
Section 5.03 Collection of Indebtedness and Suits for Enforcement
by Indenture Trustee......................................32
Section 5.04 Remedies; Priorities......................................34
Section 5.05 Optional Preservation of the Trust Estate.................35
Section 5.06 Limitation of Suits.......................................36
Section 5.07 Unconditional Rights of Noteholders To Receive
Principal and Interest....................................36
Section 5.08 Restoration of Rights and Remedies........................36
Section 5.09 Rights and Remedies Cumulative............................37
Section 5.10 Delay or Omission Not a Waiver............................37
Section 5.11 Control By Noteholders....................................37
Section 5.12 Waiver of Past Defaults...................................37
Section 5.13 Undertaking for Costs.....................................38
Section 5.14 Waiver of Stay or Extension Laws..........................38
Section 5.15 Sale of Trust Estate......................................38
Section 5.16 Action on Notes...........................................40
Section 5.17 Performance and Enforcement of Certain Obligations........40
ARTICLE VI
The Indenture Trustee
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Section 6.01 Duties of Indenture Trustee...............................42
Section 6.02 Rights of Indenture Trustee...............................43
Section 6.03 Individual Rights of Indenture Trustee....................44
Section 6.04 Indenture Trustee's Disclaimer............................44
Section 6.05 Notice of Event of Default................................44
Section 6.06 Reports by Indenture Trustee to Holders and Tax
Administration............................................44
Section 6.07 Compensation and Indemnity................................44
Section 6.08 Replacement of Indenture Trustee..........................45
Section 6.09 Successor Indenture Trustee by Merger.....................46
Section 6.10 Appointment of Co-Indenture Trustee or Separate
Indenture Trustee.........................................46
Section 6.11 Eligibility; Disqualification.............................47
Section 6.12 Preferential Collection of Claims Against Issuer..........47
Section 6.13 Representations and Warranties............................47
Section 6.14 Directions to Indenture Trustee...........................48
Section 6.15 The Agents................................................48
Section 6.16 Administrative Duties.....................................48
Section 6.17 Records..................................................50
Section 6.18 Additional Information to be Furnished....................50
ARTICLE VII
Noteholders' Lists and Reports
Section 7.01 Issuer To Furnish Indenture Trustee Names and
Addresses of Noteholders..................................51
Section 7.02 Preservation of Information; Communications to
Noteholders...............................................51
Section 7.03 Reports of Issuer.........................................51
Section 7.04 Reports by Indenture Trustee..............................52
Section 7.05 Statements to Noteholders.................................52
ARTICLE VIII
Accounts, Disbursements and Releases
Section 8.01 Collection of Money.......................................55
Section 8.02 Trust Accounts............................................55
Section 8.03 Officer's Certificate.....................................55
Section 8.04 Termination Upon Distribution to Noteholders..............56
Section 8.05 Release of Trust Estate...................................56
Section 8.06 Surrender of Notes Upon Final Payment.....................56
Section 8.07 Optional Redemption of the Notes..........................56
ARTICLE IX
Supplemental Indentures
Section 9.01 Supplemental Indentures Without Consent of Noteholders....58
Section 9.02 Supplemental Indentures With Consent of Noteholders.......59
Section 9.03 Execution of Supplemental Indentures......................60
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Section 9.04 Effect of Supplemental Indenture.........................61
Section 9.05 Conformity with Trust Indenture Act......................61
Section 9.06 Reference in Notes to Supplemental Indentures............61
ARTICLE X
Miscellaneous
Compliance Certificates and Opinions, etc.....................................62
Section 10.02 Form of Documents Delivered to Indenture Trustee.........63
Section 10.03 Acts of Noteholders......................................64
Section 10.04 Notices etc., to Indenture Trustee Issuer and
Rating Agencies..........................................64
Section 10.05 Notices to Noteholders; Waiver...........................65
Section 10.06 Conflict with Trust Indenture Act........................65
Section 10.07 Effect of Headings.......................................66
Section 10.09 Separability.............................................66
Section 10.10 [Reserved................................................66
Section 10.11 Legal Holidays...........................................66
Section 10.12 GOVERNING LAW............................................66
Section 10.13 Counterparts.............................................66
Section 10.14 Recording of Indenture...................................66
Section 10.15 Issuer Obligation........................................66
Section 10.16 No Petition..............................................67
Section 10.17 Inspection...............................................67
EXHIBITS
Exhibit A-1 -- Form of Class [_-A-_] Notes
Exhibit A-2 -- Form of Class [_-M-[_] Notes
Exhibit B -- Mortgage Loan Schedule
Appendix A -- Definitions
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This Indenture, dated as of March 31, 2004, is entered into
between American Home Mortgage Investment Trust 2004-1, a Delaware statutory
trust, as Issuer (the "Issuer"), and Xxxxx Fargo Bank, National Association, a
national banking association, as Indenture Trustee (the "Indenture Trustee").
WITNESSETH THAT:
Each party hereto agrees as follows for the benefit of the
other party and for the equal and ratable benefit of the Holders of the Issuer's
Mortgage-Backed Notes, Series 2004-1 (the "Notes").
GRANTING CLAUSE
The Issuer hereby Grants to the Indenture Trustee at the
Closing Date, as trustee for the benefit of the Holders of the Notes, all of the
Issuer's right, title and interest in and to, whether now existing or hereafter
created, (a) the Mortgage Loans, Eligible Substitute Mortgage Loans and the
proceeds thereof and all rights under the Related Documents; (b) all funds on
deposit from time to time in the Collection Account allocable to the Mortgage
Loans excluding any investment income from such funds; (c) all funds on deposit
from time to time in the Payment Account and in all proceeds thereof; (d) all
rights under (i) the Mortgage Loan Purchase Agreement as assigned to the Issuer,
(ii) the Servicing Agreement and any Subservicing Agreements, (iii) any title,
hazard and primary insurance policies with respect to the Mortgaged Properties;
(iv) the Custodial Agreement; and (e) all present and future claims, demands,
causes and choses in action in respect of any or all of the foregoing and all
payments on or under, and all proceeds of every kind and nature whatsoever in
respect of, any or all of the foregoing and all payments on or under, and all
proceeds of every kind and nature whatsoever in the conversion thereof,
voluntary or involuntary, into cash or other liquid property, all cash proceeds,
accounts, accounts receivable, notes, drafts, acceptances, checks, deposit
accounts, rights to payment of any and every kind, and other forms of
obligations and receivables, instruments and other property which at any time
constitute all or part of or are included in the proceeds of any of the
foregoing (collectively, the "Trust Estate" or the "Collateral").
The foregoing Grant is made in trust to secure the payment of
principal of and interest on, and any other amounts owing in respect of, the
Notes, equally and ratably without prejudice (except as otherwise provided
herein), priority or distinction, and to secure compliance with the provisions
of this Indenture, all as provided in this Indenture.
The Indenture Trustee, as trustee on behalf of the Holders of
the Notes, acknowledges such Xxxxx, accepts the trust under this Indenture in
accordance with the provisions hereof and agrees to perform its duties as
Indenture Trustee as required herein.
ARTICLE I
Definitions
Section 1.01 DEFINITIONS. For all purposes of this Indenture, except as
otherwise expressly provided herein or unless the context otherwise requires,
capitalized terms not otherwise defined herein shall have the meanings assigned
to such terms in the Definitions attached hereto as Appendix A which is
incorporated by reference herein. All other capitalized terms used herein shall
have the meanings specified herein.
Section 1.02 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the Trust Indenture Act (the
"TIA"), the provision is incorporated by reference in and made a part of this
Indenture. The following TIA terms used in this Indenture have the following
meanings:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Notes.
"indenture security holder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Indenture Trustee.
"obligor" on the indenture securities means the Issuer and any
other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rules and
have the meanings assigned to them by such definitions.
Section 1.03 RULES OF CONSTRUCTION. Unless the context otherwise
requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the
meaning assigned to it in accordance with generally accepted accounting
principles as in effect from time to time;
(iii) "or" is not exclusive;
(iv) "including" means including without limitation;
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(v) words in the singular include the plural and
words in the plural include the singular; and
(vi) any agreement, instrument or statute defined or
referred to herein or in any instrument or certificate delivered in
connection herewith means such agreement, instrument or statute as from
time to time amended, modified or supplemented and includes (in the
case of agreements or instruments) references to all attachments
thereto and instruments incorporated therein; references to a Person
are also to its permitted successors and assigns.
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ARTICLE II
Original Issuance of Notes
Section 2.01 FORM. The Class A Notes and Class M Notes, together with
the Indenture Trustee's certificate of authentication, shall be in substantially
the form set forth in Exhibits A-1 and A-2 to this Indenture, respectively, with
such appropriate insertions, omissions, substitutions and other variations as
are required or permitted by this Indenture.
The Notes shall be typewritten, printed, lithographed or engraved or
produced by any combination of these methods (with or without steel engraved
borders).
The terms of the Notes set forth in Exhibits A-1 and A-2 to this
Indenture are part of the terms of this Indenture.
Section 2.02 EXECUTION, AUTHENTICATION AND DELIVERY. The Notes shall be
executed on behalf of the Issuer by any of its Authorized Officers. The
signature of any such Authorized Officer on the Notes may be manual or
facsimile.
Notes bearing the manual or facsimile signature of individuals who were
at any time Authorized Officers of the Issuer shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not hold
such offices at the date of such Notes.
The Indenture Trustee shall upon Issuer Request authenticate and
deliver each Class of Notes for original issue in an aggregate initial principal
amount equal to the Initial Note Principal Balance for such Class of Notes.
Each of the Notes shall be dated the date of its authentication. The
Notes shall be issuable as registered Notes and the Notes shall be issuable in
the minimum initial Note Principal Balances of $25,000 and in integral multiples
of $1 in excess thereof.
No Note shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose, unless there appears on such Note a
certificate of authentication substantially in the form provided for herein
executed by the Indenture Trustee by the manual signature of one of its
authorized signatories, and such certificate upon any Note shall be conclusive
evidence, and the only evidence, that such Note has been duly authenticated and
delivered hereunder.
Section 2.03 ACCEPTANCE OF MORTGAGE LOANS BY INDENTURE TRUSTEE. (a) The
Indenture Trustee shall cause the Custodian as agent for the Indenture Trustee
to acknowledge receipt of, subject to the exceptions it notes pursuant to the
procedures described below, the documents (or certified copies thereof) referred
to in Section 2.1(b) of the Mortgage Loan Purchase Agreement, and to declare
that it holds and will continue to hold those documents and any amendments,
replacements or supplements thereto and all other assets of the Trust Estate, as
agent for the Indenture Trustee in trust for the use and benefit of all present
and future Holders of the Notes. No later than the Closing Date, with respect to
the Mortgage Loans (or, with respect to any Eligible Substitute Mortgage Loan,
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within 5 days after the receipt by the Custodian as agent for the Indenture
Trustee thereof and, with respect to any documents received after the Closing
Date, promptly thereafter), the Indenture Trustee shall cause the Custodian, as
agent for the Indenture Trustee, to agree, for the benefit of the Noteholders,
to review each Mortgage File delivered to it and to execute and deliver, or to
cause to be executed and delivered, to the Seller, the Indenture Trustee and the
Master Servicer an Initial Certification in the form annexed to the Custodial
Agreement as Exhibit One. In conducting such review, the Indenture Trustee shall
cause the Custodian, as agent for the Indenture Trustee, to ascertain whether
all required documents described in Section 2.1(b)(i) to (v) of the Mortgage
Loan Purchase Agreement have been executed and received and whether those
documents relate, to the Mortgage Loans it has received, as identified in
Exhibit B to this Indenture, as supplemented (PROVIDED, HOWEVER, that with
respect to those documents described in subclause (b)(vi) of such section, the
Custodian's obligations shall extend only to documents actually delivered
pursuant to such subclause). In performing any such review, the Custodian as
agent for the Indenture Trustee may conclusively rely on the purported due
execution and genuineness of any such document and on the purported genuineness
of any signature thereon. If the Custodian as agent for the Indenture Trustee
finds any document constituting part of the Mortgage File not to have been
executed or received, or to be unrelated to the Mortgage Loans identified in
Exhibit B to this Indenture or to appear to be defective on its face, the
Custodian as agent for the Indenture Trustee shall promptly notify the Seller
and the Indenture Trustee of such finding.
(b) No later than 180 days after the Closing Date, the Custodian as
agent for the Indenture Trustee will review, for the benefit of the Noteholders,
the Mortgage Files and will execute and deliver or cause to be executed and
delivered to the Seller, the Master Servicer and the Indenture Trustee, a Final
Certification in the form annexed to the Custodial Agreement as Exhibit Two. In
conducting such review, the Custodian as agent for the Indenture Trustee will
ascertain whether an original of each document described in subclauses
(b)(ii)-(iv) of Section 2.1 of (i) the Mortgage Loan Purchase Agreement,
required to be recorded has been returned from the recording office with
evidence of recording thereon or a certified copy has been obtained from the
recording office. If the Custodian as agent for the Indenture Trustee finds any
document constituting part of the Mortgage File has not been received, or to be
unrelated, to the Mortgage Loans identified in Exhibit B to this Indenture or to
appear defective on its face, the Custodian as agent for the Indenture Trustee
shall promptly notify the Seller and the Indenture Trustee.
(c) Upon deposit by the Seller of the Repurchase Price in the Payment
Account, the Indenture Trustee shall cause the Custodian to release to the
Seller or the Master Servicer, as applicable, the related Mortgage File and the
Indenture Trustee shall execute and deliver all instruments of transfer or
assignment, without recourse, furnished to it by the Seller or the Master
Servicer, as applicable, as are necessary to vest in the Seller or the Master
Servicer, as applicable, title to and rights under the related Mortgage Loan.
Such purchase shall be deemed to have occurred on the date on which the deposit
of the Repurchase Price in the Payment Account was received by the Indenture
Trustee. The Custodian as agent for the Indenture Trustee shall amend the
applicable Mortgage Loan Schedule to reflect such repurchase and shall promptly
notify the Master Servicer and the Indenture Trustee of such amendment.
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ARTICLE III
Covenants
Section 3.01 COLLECTION OF PAYMENTS WITH RESPECT TO THE MORTGAGE LOANS.
The Indenture Trustee shall establish and maintain an Eligible Account (the
"Payment Account") in which the Indenture Trustee shall deposit, on the same day
as it is received from the Master Servicer, each remittance received by the
Indenture Trustee with respect to the Mortgage Loans. The Indenture Trustee
shall make all payments of principal of and interest on the Notes, subject to
Section 3.03, and as provided in Section 3.05 herein from monies on deposit in
the Payment Account.
Section 3.02 MAINTENANCE OF OFFICE OR AGENCY. The Issuer will maintain
an office or agency where, subject to satisfaction of conditions set forth
herein, Notes may be surrendered for registration of transfer or exchange, and
where notices and demands to or upon the Issuer in respect of the Notes and this
Indenture may be served. The Issuer hereby initially appoints the Indenture
Trustee to serve as its agent for the foregoing purposes. If at any time the
Issuer shall fail to maintain any such office or agency or shall fail to furnish
the Indenture Trustee with the address thereof, such surrenders may be made at
the office of the Indenture Trustee located at Sixth Street and Marquette
Avenue, Minneapolis, Minnesota 55479-0113, Attention: Corporate Trust Services,
American Home Mortgage Securities LLC, Series 2004-1, and notices and demands
may be made or served at the Corporate Trust Office, and the Issuer hereby
appoints the Indenture Trustee as its agent to receive all such surrenders,
notices and demands.
Section 3.03 MONEY FOR PAYMENTS TO BE HELD IN TRUST; PAYING AGENT. (a)
As provided in Section 3.01, all payments of amounts due and payable with
respect to any Notes that are to be made from amounts withdrawn from the Payment
Account pursuant to Section 3.01 shall be made on behalf of the Issuer by the
Indenture Trustee or by the Paying Agent, and no amounts so withdrawn from the
Payment Account for payments of Notes shall be paid over to the Issuer except as
provided in this Section 3.03. The Issuer hereby appoints the Indenture Trustee
as its Paying Agent.
The Issuer will cause each Paying Agent other than the Indenture
Trustee to execute and deliver to the Indenture Trustee an instrument in which
such Paying Agent shall agree with the Indenture Trustee (and if the Indenture
Trustee acts as Paying Agent it hereby so agrees), subject to the provisions of
this Section 3.03, that such Paying Agent will:
(i) hold all sums held by it for the payment of amounts
due with respect to the Notes in trust for the benefit of the Persons
entitled thereto until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and pay such sums to such
Persons as herein provided;
(ii) give the Indenture Trustee notice of any default by
the Issuer of which it has actual knowledge in the making of any
payment required to be made with respect to the Notes;
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(iii) at any time during the continuance of any such
default, upon the written request of the Indenture Trustee, forthwith
pay to the Indenture Trustee all sums so held in trust by such Paying
Agent;
(iv) immediately resign as Paying Agent and forthwith pay
to the Indenture Trustee all sums held by it in trust for the payment
of Notes if at any time it ceases to meet the standards required to be
met by a Paying Agent at the time of its appointment;
(v) comply with all requirements of the Code with
respect to the withholding from any payments made by it on any Notes of
any applicable withholding taxes imposed thereon and with respect to
any applicable reporting requirements in connection therewith; and
(vi) not commence a bankruptcy proceeding against the
Issuer in connection with this Indenture.
The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by Issuer
Request direct any Paying Agent to pay to the Indenture Trustee all sums held in
trust by such Paying Agent, such sums to be held by the Indenture Trustee upon
the same trusts as those upon which the sums were held by such Paying Agent; and
upon such payment by any Paying Agent to the Indenture Trustee, such Paying
Agent shall be released from all further liability with respect to such money.
Subject to applicable laws with respect to escheat of funds, any money
held by the Indenture Trustee or any Paying Agent in trust for the payment of
any amount due with respect to any Note and remaining unclaimed for one year
after such amount has become due and payable shall be discharged from such trust
and be paid to the Issuer on Issuer Request; and the Holder of such Note shall
thereafter, as an unsecured general creditor, look only to the Issuer for
payment thereof (but only to the extent of the amounts so paid to the Issuer),
and all liability of the Indenture Trustee or such Paying Agent with respect to
such trust money shall thereupon cease; PROVIDED, HOWEVER, that the Indenture
Trustee or such Paying Agent, before being required to make any such repayment,
shall at the expense and direction of the Issuer cause to be published once, in
an Authorized Newspaper published in the English language, notice that such
money remains unclaimed and that, after a date specified therein which shall not
be less than 30 days from the date of such publication, any unclaimed balance of
such money then remaining will be repaid to the Issuer. The Indenture Trustee
may also adopt and employ, at the expense and direction of the Issuer, any other
reasonable means of notification of such repayment (including, but not limited
to, mailing notice of such repayment to Holders whose Notes have been called but
have not been surrendered for redemption or whose right to or interest in monies
due and payable but not claimed is determinable from the records of the
Indenture Trustee or of any Paying Agent, at the last address of record for each
such Holder).
Section 3.04 EXISTENCE. The Issuer will keep in full effect its
existence, rights and franchises as a statutory trust under the laws of the
State of Delaware (unless it becomes, or any successor Issuer hereunder is or
becomes, organized under the laws of any other state or of the United States of
America, in which case the Issuer will keep in full effect its existence, rights
and franchises under the laws of such other jurisdiction) and will obtain and
preserve its qualification
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to do business in each jurisdiction in which such qualification is or shall be
necessary to protect the validity and enforceability of this Indenture, the
Notes, the Mortgage Loans and each other instrument or agreement included in the
Trust Estate.
Section 3.05 PAYMENT OF PRINCIPAL AND INTEREST. (a) On each Payment
Date from amounts on deposit in the Payment Account in accordance with Section
8.02 hereof, the Indenture Trustee shall pay to the Persons specified below, to
the extent provided therein, the Available Funds for such Payment Date.
(b) On each Payment Date, the Group I Available Funds shall be
distributed in the following order of priority, in each case to the extent of
the Group I Available Funds remaining for such Payment Date:
(i) to the Holders of the Class I-A Notes, the
related Accrued Note Interest for such Class for such Payment Date;
(ii) to the Holders of the Class I-M-1 Notes, the
related Accrued Note Interest for such Class for such Payment Date;
(iii) to the Holders of the Class I-M-2 Notes, the
related Accrued Note Interest for such Class for such Payment Date; and
(iv) to the Holders of the Class I-M-3 Notes, the
related Accrued Note Interest for such Class for such Payment Date.
(c) On each Payment Date, the Holders of the Class I-A, Class I-M-1,
Class I-M-2 and Class I-M-3 Notes shall be entitled to receive payments in
respect of principal equal the related Principal Distribution Amount for that
Payment Date, allocated on a pro rata basis, based on the Note Principal
Balances thereof, in reduction of the Note Principal Balances thereof, until the
Note Principal Balances thereof have been reduced to zero.
(d) On each Payment Date, any Net Monthly Excess Cashflow in respect of
the Group I Loans shall be paid, in each case to the extent of remaining related
Net Excess Monthly Cashflow, as follows:
(i) to the Holders of the Class I-A, Class I-M-1,
Class I-M-2 and Class I-M-3 Notes, pro rata, in an amount equal to any
related Undercollateralization Amount, payable to such Holders as part
of the related Principal Distribution Amount as described under Section
3.05(c) above;
(ii) to the Holders of the Group II Notes, Group III
Notes and the Group IV Notes, any related Cross-Collateralized
Undercollateralization Payments as provided in Section 3.05(n) below,
payable to such Holders as part of the related Principal Distribution
Amount as described under Section 3.05(f), Section 3.05(i) and Section
3.05(l) below, respectively;
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(iii) to the Holders of the Class I-A, Class I-M-1,
Class I-M-2 and Class I-M-3 Notes, pro rata, in an amount equal to any
related Overcollateralization Increase Amount, payable to such Holders
as part of the related Principal Distribution Amount as described under
Section 3.05(c) above;
(iv) to the Holders of the Group II Notes, Group III
Notes and the Group IV Notes, any related Cross-Collateralized Loss
Payments as provided in Section 3.05(o) below, payable to such Holders
as part of the related Principal Distribution Amount as described under
Section 3.05(f), Section 3.05(i) and Section 3.05(l) below,
respectively;
(v) to the Holders of the Class I-A, Class I-M-1,
Class I-M-2 and Class I-M-3 Notes, pro rata, any Unpaid Interest
Shortfall for such Notes on such Payment Date, to the extent not
previously reimbursed;
(vi) sequentially, to the Holders of the Class I-M-1,
Class I-M-2 and Class I-M-3 Notes in an amount equal to the Allocated
Realized Loss Amount for such Notes, to the extent not previously
reimbursed;
(vii) sequentially, to the Holders of the Class I-A,
Class I-M-1, Class I-M-2 and Class I-M-3 Notes any related Basis Risk
Shortfall Carry-Forward Amount for such Notes on such Payment Date; and
(viii) any remaining amounts will be distributed to
the Certificate Paying Agent, as designee of the Issuer, for the
benefit of the Holders of the Trust Certificates, as provided herein
and in the Trust Agreement.
(e) On each Payment Date, the Group II Available Funds shall be
distributed in the following order of priority, in each case to the extent of
the Group II Available Funds remaining for such Payment Date:
(i) to the Holders of the Class II-A Notes, the
related Accrued Note Interest for such Class for such Payment Date;
(ii) to the Holders of the Class II-M-1 Notes, the
related Accrued Note Interest for such Class for such Payment Date;
(iii) to the Holders of the Class II-M-2 Notes, the
related Accrued Note Interest for such Class for such Payment Date; and
(iv) to the Holders of the Class II-M-3 Notes, the
related Accrued Note Interest for such Class for such Payment Date.
(f) On each Payment Date, the Holders of the Class II-A, Class II-M-1,
Class II-M-2 and Class II-M-3 Notes shall be entitled to receive payments in
respect of principal equal to the related Principal Distribution Amount for that
Payment Date, allocated on a pro rata basis, based on the
9
Note Principal Balances thereof, in reduction of the Note Principal Balances
thereof, until the Note Principal Balances thereof have been reduced to zero.
(g) On each Payment Date, any Net Monthly Excess Cashflow in respect of
the Group II Loans shall be paid, in each case to the extent of remaining
related Net Monthly Excess Cashfllow, as follows:
(i) to the Holders of the Class II-A, Class II-M-1,
Class II-M-2 and Class II-M-3 Notes, pro rata, in an amount equal to
any related Undercollateralization Amount, payable to such Holders as
part of the related Principal Distribution Amount as described under
Section 3.05(f) above;
(ii) to the Holders of the Group I Notes, Group III
Notes and the Group IV Notes, any related Cross-Collateralized
Undercollateralization Payments as provided in Section 3.05(n) below,
payable to such Holders as part of the related Principal Distribution
Amount as described under Section 3.05(c) above and Section 3.05(i) and
Section 3.05(l) below, respectively;
(iii) to the Holders of the Class II-A, Class II-M-1,
Class II-M-2 and Class II-M-3 Notes, pro rata, in an amount equal to
any related Overcollateralization Increase Amount, payable to such
Holders as part of the related Principal Distribution Amount as
described under Section 3.05(f) above;
(iv) to the Holders of the Group I Notes, Group III
Notes and the Group IV Notes, any related Cross-Collateralized Loss
Payments as provided in Section 3.05(o) below, payable to such Holders
as part of the related Principal Distribution Amount as described under
Section 3.05(c) above and Section 3.05(i) and Section 3.05(l) below,
respectively;
(v) to the Holders of the Class II-A, Class II-M-1,
Class II-M-2 and Class II-M-3 Notes, pro rata, any Unpaid Interest
Shortfall for such Notes on such Payment Date, to the extent not
previously reimbursed;
(vi) sequentially, to the Holders of the Class
II-M-1, Class II-M-2 and Class II-M-3 Notes in an amount equal to the
Allocated Realized Loss Amount for such Notes, to the extent not
previously reimbursed;
(vii) sequentially, to the Holders of the Class II-A,
Class II-M-1, Class II- M-2 and Class II-M-3 Notes any related Basis
Risk Shortfall Carry-Forward Amount or Net WAC Shortfall Carry-Forward
Amount for such Notes on such Payment Date; and
(viii) any remaining amounts will be distributed to
the Certificate Paying Agent, as designee of the Issuer, for the
benefit of the Holders of the Trust Certificates, as provided herein
and in the Trust Agreement.
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(h) On each Payment Date, the Group III Available Funds shall be
distributed in the following order of priority, in each case to the extent of
the Group III Available Funds remaining for such Payment Date:
(i) to the Holders of the Class III-A Notes, the
related Accrued Note Interest for such Class for such Payment Date;
(ii) to the Holders of the Class III-M-1 Notes, the
related Accrued Note Interest for such Class for such Payment Date; and
(iii) to the Holders of the Class III-M-2 Notes, the
related Accrued Note Interest for such Class for such Payment Date.
(i) On each Payment Date, the Holders of the Class III-A, Class III-M-1
and Class III-M- 2 Notes shall be entitled to receive payments in respect of
principal equal to the related Principal Distribution Amount for that Payment
Date, allocated on a pro rata basis, based on the Note Principal Balances
thereof, in reduction of the Note Principal Balances thereof, until the Note
Principal Balances thereof have been reduced to zero.
(j) On each Payment Date, any Net Monthly Excess Cashflow in respect of
the Group III Loans shall be paid, in each case to the extent of remaining
related Net Monthly Excess Cashflow, as follows:
(i) to the Holders of the Class III-A, Class III-M-1
and Class III-M-2 Notes, pro rata, in an amount equal to any related
Undercollateralization Amount, payable to such Holders as part of the
related Principal Distribution Amount as described under Section
3.05(i) above;
(ii) to the Holders of the Group I Notes, the Group
II Notes and the Group IV Notes, any related Cross-Collateralized
Undercollateralization Payments as provided in Section 3.05(n) below,
payable to such Holders as part of the related Principal Distribution
Amount as described under Section 3.05(c) and Section 3.05(f) above and
Section 3.05(l) below, respectively;
(iii) to the Holders of the Class III-A, Class
III-M-1 and Class III-M-2 Notes, pro rata, in an amount equal to any
Overcollateralization Increase Amount, payable to such Holders as part
of the related Principal Distribution Amount as described under Section
3.05(i) above;
(iv) to the Holders of the Group I Notes, the Group
II Notes and the Group IV Notes, any Cross-Collateralized Loss Payments
as provided in Section 3.05(o) below, payable to such Holders as part
of the related Principal Distribution Amount as described under Section
3.05(c) and Section 3.05(f) above and Section 3.05(l) below,
respectively;
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(v) to the Holders of the Class III-A, Class III-M-1
and Class III-M-2 Notes, pro rata, any Unpaid Interest Shortfall for
such Notes on such Payment Date, to the extent not previously
reimbursed;
(vi) sequentially, to the Holders of the Class
III-M-1 and Class III-M-2 Notes in an amount equal to the Allocated
Realized Loss Amount for such Notes, to the extent not previously
reimbursed;
(vii) sequentially, to the Holders of the Class
III-A, Class III-M-1 and Class III-M-2 Notes any related Basis Risk
Shortfall Carry-Forward Amount or Net WAC Shortfall Carry-Forward
Amount for such Notes on such Payment Date; and
(viii) any remaining amounts will be distributed to
the Certificate Paying Agent, as designee of the Issuer, for the
benefit of the Holders of the Trust Certificates, as provided herein
and in the Trust Agreement.
(k) On each Payment Date, the Group IV Available Funds shall be
distributed in the following order of priority, in each case to the extent of
the Group IV Available Funds remaining for such Payment Date:
(i) to the Holders of the Class IV-A Notes, the
related Accrued Note Interest for such Class for such Payment Date;
(ii) to the Holders of the Class IV-M-1 Notes, the
related Accrued Note Interest for such Class for such Payment Date;
(iii) to the Holders of the Class IV-M-2 Notes, the
related Accrued Note Interest for such Class for such Payment Date; and
(iv) to the Holders of the Class IV-M-3 Notes, the
related Accrued Note Interest for such Class for such Payment Date.
(l) On each Payment Date, the Holders of the Class IV-A, Class IV-M-1,
Class IV-M-2 and Class IV-M-3 Notes shall be entitled to receive payments in
respect of principal equal to the related Principal Distribution Amount for that
Payment Date, allocated on a pro rata basis, based on the Note Principal
Balances thereof, in reduction of the Note Principal Balances thereof, until the
Note Principal Balances thereof have been reduced to zero.
(m) On each Payment Date, any Net Monthly Excess Cashflow in respect of
the Group IV Loans shall be paid, in each case to the extent of remaining
related Net Monthly Excess Cashflow, as follows:
(i) to the Holders of the Class IV-A, Class IV-M-1,
Class IV-M-2 and Class IV-M-3 Notes, pro rata, in an amount equal to
any related Undercollateralization Amount, payable to such Holders as
part of the related Principal Distribution Amount as described under
Section 3.05(l) above;
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(ii) to the Holders of the Group I Notes, the Group
II Notes and the Group III Notes, any Cross-Collateralized
Undercollateralization Payments as provided in Section 3.05(n) below,
payable to such Holders as part of the related Principal Distribution
Amount as described under Section 3.05(c), Section 3.05(f) and Section
3.05(i) above, respectively;
(iii) to the Holders of the Class IV-A, Class IV-M-1,
Class IV-M-2 and Class IV-M-3 Notes, pro rata, in an amount equal to
any related Overcollateralization Increase Amount, payable to such
Holders as part of the related Principal Distribution Amount as
described under Section 3.05(l) above;
(iv) to the Holders of the Group I Notes, the Group
II Notes and the Group III Notes, any Cross-Collateralized Loss
Payments as provided in Section 3.05(o) below, payable to such Holders
as part of the related Principal Distribution Amount as described under
Section 3.05(c), Section 3.05(f) and Section 3.05(i) above,
respectively;
(v) to the Holders of the Class IV-A, Class IV-M-1,
Class IV-M-2 and Class IV-M-3 Notes, pro rata, any Unpaid Interest
Shortfall for such Notes on such Payment Date, to the extent not
previously reimbursed;
(vi) sequentially, to the Holders of the Class
IV-M-1, Class IV-M-2 and Class IV-M-3 Notes in an amount equal to the
Allocated Realized Loss Amount for the such Notes, to the extent not
previously reimbursed;
(vii) sequentially, to the Holders of the Class IV-A,
Class IV-M-1, Class IV-M-2 and Class IV-M-3 Notes any related Basis
Risk Shortfall Carry-Forward Amount or Net WAC Shortfall Carry-Forward
Amount for such Notes on such Payment Date; and
(viii) any remaining amounts will be distributed to
the Certificate Paying Agent, as designee of the Issuer, for the
benefit of the Holders of the Trust Certificates, as provided herein
and in the Trust Agreement.
(n) On each Payment Date, Undercollateralization Payment Crossable
Excess from each Loan Group will be available to cover Crossable
Undercollateralization Amounts on Mortgage Loans in the non-related Loan Groups
as follows:
(i) If on such Payment Date one Loan Group has
Undercollateralization Payment Crossable Excess and one Loan Group has
Crossable Undercollateralization Amounts, payments shall be made from
the one Loan Group with Undercollateralization Payment Crossable Excess
to the Loan Group with Crossable Undercollateralization Amounts, up to
the amount of such Crossable Undercollateralization Amounts;
(ii) If on such Payment Date one Loan Group has
Undercollateralization Payment Crossable Excess and two or three Loan
Groups have Crossable Undercollateralization Amounts, payments shall be
made from the one Loan Group with Undercollateralization Payment
Crossable Excess to the Loan Groups with Crossable
Undercollateralization
13
Amounts, pro rata, based on the amount of Crossable
Undercollateralization Amounts, up to the aggregate amount of such
Crossable Undercollateralization Amounts;
(iii) If on such Payment Date two or three Loan Groups have
Undercollateralization Payment Crossable Excess and one Loan Group has
Crossable Undercollateralization Amounts, payments shall be made from
the Loan Groups with Undercollateralization Payment Crossable Excess on
a pro rata basis, based on the amount of Undercollateralization Payment
Crossable Excess for such Loan Groups, to the Loan Group with Crossable
Undercollateralization Amounts, up to the aggregate amount of such
Crossable Undercollateralization Amounts; and
(iv) If on such Payment Date two Loan Groups have
Undercollateralization Payment Crossable Excess and two Loan Groups
have Crossable Undercollateralization Amounts, payments shall be made
from the Loan Groups with Undercollateralization Payment Crossable
Excess on a pro rata basis, based on the amount of
Undercollateralization Payment Crossable Excess for such Loan Groups,
to the Loan Groups with Crossable Undercollateralization Amounts, pro
rata, based on the amount of Crossable Undercollateralization Amounts,
up to the aggregate amount of such Crossable Undercollateralization
Amounts.
(o) On each Payment Date, Crossable Loss Crossable Excess from each
Loan Group will be available to cover Crossable Undercollateralization Amounts
on Mortgage Loans in the non-related Loan Groups as follows:
(i) If on such Payment Date one Loan Group has Crossable Loss
Crossable Excess and one Loan Group has Crossable Losses, payments
shall be made from the one Loan Group with Crossable Loss Crossable
Excess to the Loan Group with Crossable Losses, up to the amount of
such Crossable Losses;
(ii) If on such Payment Date one Loan Group has Crossable Loss
Crossable Excess and two or three Loan Groups have Crossable Losses,
payments shall be made from the one Loan Group with Crossable Loss
Crossable Excess to the Loan Groups with Crossable Losses, pro rata,
based on the amount of Crossable Losses, up to the aggregate amount of
such Crossable Losses;
(iii) If on such Payment Date two or three Loan Groups have
Crossable Loss Crossable Excess and one Loan Group has Crossable
Losses, payments shall be made from the Loan Groups with Crossable Loss
Crossable Excess on a pro rata basis, based on the amount of Crossable
Loss Crossable Excess for such Loan Groups, to the Loan Group with
Crossable Losses, up to the aggregate amount of such Crossable Losses;
and
(iv) If on such Payment Date two Loan Groups have Crossable
Loss Crossable Excess and two Loan Groups have Crossable Losses,
payments shall be made from the Loan Groups with Crossable Loss
Crossable Excess on a pro rata basis, based on the amount of Crossable
Loss Crossable Excess for such Loan Groups, to the Loan Groups with
Crossable
14
Losses, pro rata, based on the amount of Crossable Losses, up to the
aggregate amount of such Crossable Losses.
(p) Each distribution with respect to a Book-Entry Note shall be paid
to the Depository, as Holder thereof, and the Depository shall be responsible
for crediting the amount of such distribution to the accounts of its Depository
Participants in accordance with its normal procedures. Each Depository
Participant shall be responsible for disbursing such distribution to the Note
Owners that it represents and to each indirect participating brokerage firm (a
"brokerage firm" or "indirect participating firm") for which it acts as agent.
Each brokerage firm shall be responsible for disbursing funds to the Note Owners
that it represents. None of the Indenture Trustee, the Note Registrar, the
Paying Agent, the Depositor or the Master Servicer shall have any responsibility
therefor except as otherwise provided by this Indenture or applicable law.
(q) On each Payment Date, the Certificate Paying Agent shall deposit in
the Certificate Distribution Account all amounts it received pursuant to this
Section 3.05 for the purpose of distributing such funds to the
Certificateholders.
(r) Any installment of interest or principal, if any, payable on any
Note that is punctually paid or duly provided for by the Issuer on the
applicable Payment Date shall, if such Holder shall have so requested at least
five Business Days prior to the related Record Date, be paid to each Holder of
record on the preceding Record Date, by wire transfer to an account specified in
writing by such Holder reasonably satisfactory to the Indenture Trustee as of
the preceding Record Date or in all other cases or if no such instructions have
been delivered to the Indenture Trustee, by check to such Noteholder mailed to
such Holder's address as it appears in the Note Register in the amount required
to be distributed to such Holder on such Payment Date pursuant to such Holder's
Notes; PROVIDED, HOWEVER, that the Indenture Trustee shall not pay to such
Holders any amount required to be withheld from a payment to such Holder by the
Code.
(s) The principal of each Note shall be due and payable in full on the
Final Scheduled Payment Date for such Note as provided in the forms of Note set
forth in Exhibits A-1 and A-2 to this Indenture. All principal payments on the
Notes shall be made to the Noteholders entitled thereto in accordance with the
Percentage Interests represented by such Notes. Upon notice to the Indenture
Trustee by the Issuer, the Indenture Trustee shall notify the Person in whose
name a Note is registered at the close of business on the Record Date preceding
the Final Scheduled Payment Date or other final Payment Date (including any
final Payment Date resulting from any redemption pursuant to Section 8.07
hereof). Such notice shall to the extent practicable be mailed no later than
five Business Days prior to such Final Scheduled Payment Date or other final
Payment Date and shall specify that payment of the principal amount and any
interest due with respect to such Note at the Final Scheduled Payment Date or
other final Payment Date will be payable only upon presentation and surrender of
such Note and shall specify the place where such Note may be presented and
surrendered for such final payment. No interest shall accrue on the Notes on or
after the Final Scheduled Payment Date or any such other final Payment Date.
Section 3.06 PROTECTION OF TRUST ESTATE. (a) The Issuer will from time
to time prepare, execute and deliver all such supplements and amendments hereto
and all such financing statements,
15
continuation statements, instruments of further assurance and other instruments,
and will take such other action necessary or advisable to:
(i) maintain or preserve the lien and security
interest (and the priority thereof) of this Indenture or carry out more
effectively the purposes hereof;
(ii) perfect, publish notice of or protect the
validity of any Grant made or to be made by this Indenture;
(iii) cause the Issuer or Master Servicer to enforce
any of the rights to the Mortgage Loans; or
(iv) preserve and defend title to the Trust Estate
and the rights of the Indenture Trustee and the Noteholders in such
Trust Estate against the claims of all persons and parties.
(b) Except as otherwise provided in this Indenture, the Indenture
Trustee shall not remove any portion of the Trust Estate that consists of money
or is evidenced by an instrument, certificate or other writing from the
jurisdiction in which it was held at the date of the most recent Opinion of
Counsel delivered pursuant to Section 3.07 hereof (or from the jurisdiction in
which it was held as described in the Opinion of Counsel delivered on the
Closing Date pursuant to Section 3.07(a) hereof, or if no Opinion of Counsel has
yet been delivered pursuant to Section 3.07(b) hereof, unless the Indenture
Trustee shall have first received an Opinion of Counsel to the effect that the
lien and security interest created by this Indenture with respect to such
property will continue to be maintained after giving effect to such action or
actions).
The Issuer hereby designates the Indenture Trustee its agent and
attorney-in-fact to sign any financing statement, continuation statement or
other instrument required to be signed pursuant to this Section 3.06 upon the
Issuer's preparation thereof and delivery to the Indenture Trustee.
Section 3.07 OPINIONS AS TO TRUST ESTATE. (a) On the Closing Date, the
Issuer shall furnish to the Indenture Trustee and the Owner Trustee an Opinion
of Counsel either stating that, in the opinion of such counsel, such action has
been taken with respect to the recording and filing of this Indenture, any
indentures supplemental hereto, and any other requisite documents, and with
respect to the execution and filing of any financing statements and continuation
statements, as are necessary to perfect and make effective the lien and first
priority security interest in the Collateral and reciting the details of such
action, or stating that, in the opinion of such counsel, no such action is
necessary to make such lien and first priority security interest effective.
(b) On or before April 15 in each calendar year, beginning in 2005, the
Issuer shall furnish to the Indenture Trustee an Opinion of Counsel at the
expense of the Issuer either stating that, in the opinion of such counsel, such
action has been taken with respect to the recording, filing, re- recording and
refiling of this Indenture, any indentures supplemental hereto and any other
requisite documents and with respect to the execution and filing of any
financing statements and continuation statements as is necessary to maintain the
lien and first priority security interest in the Collateral and reciting the
details of such action or stating that in the opinion of such counsel no such
action is
16
necessary to maintain such lien and security interest. Such Opinion of Counsel
shall also describe the recording, filing, re-recording and refiling of this
Indenture, any indentures supplemental hereto and any other requisite documents
and the execution and filing of any financing statements and continuation
statements that will, in the opinion of such counsel, be required to maintain
the lien and security interest in the Collateral until December 31 in the
following calendar year.
Section 3.08 PERFORMANCE OF OBLIGATIONS. (a) The Issuer will punctually
perform and observe all of its obligations and agreements contained in this
Indenture, the Basic Documents and in the instruments and agreements included in
the Trust Estate.
(b) The Issuer may contract with other Persons to assist it in
performing its duties under this Indenture, and any performance of such duties
by a Person identified to the Indenture Trustee in an Officer's Certificate of
the Issuer shall be deemed to be action taken by the Issuer.
(c) The Issuer will not take any action or permit any action to be
taken by others which would release any Person from any of such Person's
covenants or obligations under any of the documents relating to the Mortgage
Loans or under any instrument included in the Trust Estate, or which would
result in the amendment, hypothecation, subordination, termination or discharge
of, or impair the validity or effectiveness of, any of the documents relating to
the Mortgage Loans or any such instrument, except such actions as the Master
Servicer is expressly permitted to take in the Servicing Agreement. The
Indenture Trustee, as pledgee of the Mortgage Loans, may exercise the rights of
the Issuer to direct the actions of the Master Servicer pursuant to the
Servicing Agreement.
(d) The Issuer may retain an administrator and may enter into contracts
with other Persons for the performance of the Issuer's obligations hereunder,
and performance of such obligations by such Persons shall be deemed to be
performance of such obligations by the Issuer.
Section 3.09 NEGATIVE COVENANTS. So long as any Notes are Outstanding,
the Issuer shall not:
(i) except as expressly permitted by this Indenture,
sell, transfer, exchange or otherwise dispose of the Trust Estate,
unless directed to do so by the Indenture Trustee;
(ii) claim any credit on, or make any deduction from
the principal or interest payable in respect of, the Notes (other than
amounts properly withheld from such payments under the Code) or assert
any claim against any present or former Noteholder by reason of the
payment of the taxes levied or assessed upon any part of the Trust
Estate;
(iii) (A) permit the validity or effectiveness of
this Indenture to be impaired, or permit the lien of this Indenture to
be amended, hypothecated, subordinated, terminated or discharged, or
permit any Person to be released from any covenants or obligations with
respect to the Notes under this Indenture except as may be expressly
permitted hereby, (B) permit any lien, charge, excise, claim, security
interest, mortgage or other encumbrance (other than the lien of this
Indenture) to be created on or extend to or otherwise arise upon or
burden the Trust Estate or any part thereof or any interest therein or
17
the proceeds thereof or (C) permit the lien of this Indenture not to
constitute a valid first priority security interest in the Trust
Estate; or
(iv) waive or impair, or fail to assert rights under,
the Mortgage Loans, or impair or cause to be impaired the Issuer's
interest in the Mortgage Loans, the Mortgage Loan Purchase Agreement or
in any Basic Document, if any such action would materially and
adversely affect the interests of the Noteholders.
Section 3.10 ANNUAL STATEMENT AS TO COMPLIANCE. The Issuer will deliver
to the Indenture Trustee, by March 1 of each year commencing with the calendar
year 2005, an Officer's Certificate stating, as to the Authorized Officer
signing such Officer's Certificate, that:
(i) a review of the activities of the Issuer during
the previous calendar year and of its performance under this Indenture
has been made under such Authorized Officer's supervision; and
(ii) to the best of such Authorized Officer's
knowledge, based on such review, the Issuer has complied with all
conditions and covenants under this Indenture throughout such year, or,
if there has been a default in its compliance with any such condition
or covenant, specifying each such default known to such Authorized
Officer and the nature and status thereof.
Section 3.11 [RESERVED].
Section 3.12 REPRESENTATIONS AND WARRANTIES CONCERNING THE MORTGAGE
LOANS. The Indenture Trustee, as pledgee of the Mortgage Loans, shall have the
benefit of the representations and warranties made by the Seller in the Mortgage
Loan Purchase Agreement concerning the Seller and the Mortgage Loans to the same
extent as though such representations and warranties were made directly to the
Indenture Trustee. If a Responsible Officer of the Indenture Trustee has actual
knowledge of any breach of any representation or warranty made by the Seller in
the Mortgage Loan Purchase Agreement, the Indenture Trustee shall promptly
notify the Seller of such finding and the Seller's obligation to cure such
defect or repurchase or substitute for the related Mortgage Loan.
Section 3.13 AMENDMENTS TO SERVICING AGREEMENT. The Issuer covenants
with the Indenture Trustee that it will not enter into any amendment or
supplement to the Servicing Agreement without the prior written consent of the
Indenture Trustee.
Section 3.14 MASTER SERVICER AS AGENT AND BAILEE OF THE INDENTURE
TRUSTEE. Solely for purposes of perfection under Section 9-305 of the Uniform
Commercial Code or other similar applicable law, rule or regulation of the state
in which such property is held by the Master Servicer, the Issuer and the
Indenture Trustee hereby acknowledge that the Master Servicer is acting as
bailee of the Indenture Trustee in holding amounts on deposit in the Collection
Account, as well as its bailee in holding any Related Documents released to the
Master Servicer, and any other items constituting a part of the Trust Estate
which from time to time come into the possession of the Master Servicer. It is
intended that, by the Master Servicer's acceptance of such bailee arrangement,
the Indenture Trustee, as a secured party of the Mortgage Loans, will be deemed
to have possession
18
of such Related Documents, such monies and such other items for purposes of
Section 9-305 of the Uniform Commercial Code of the state in which such property
is held by the Master Servicer. The Indenture Trustee shall not be liable with
respect to such documents, monies or items while in possession of the Master
Servicer.
Section 3.15 INVESTMENT COMPANY ACT. The Issuer shall not become an
"investment company" or be under the "control" of an "investment company" as
such terms are defined in the Investment Company Act of 1940, as amended (or any
successor or amendatory statute), and the rules and regulations thereunder
(taking into account not only the general definition of the term "investment
company" but also any available exceptions to such general definition);
PROVIDED, HOWEVER, that the Issuer shall be in compliance with this Section 3.15
if it shall have obtained an order exempting it from regulation as an
"investment company" so long as it is in compliance with the conditions imposed
in such order.
Section 3.16 ISSUER MAY CONSOLIDATE, ETC. (a) The Issuer shall not
consolidate or merge with or into any other Person, unless:
(i) the Person (if other than the Issuer) formed by
or surviving such consolidation or merger shall be a Person organized
and existing under the laws of the United States of America or any
state or the District of Columbia and shall expressly assume, by an
indenture supplemental hereto, executed and delivered to the Indenture
Trustee, in form reasonably satisfactory to the Indenture Trustee, the
due and punctual payment of the principal of and interest on all Notes,
and all amounts payable to the Indenture Trustee, the payment to the
Certificate Paying Agent of all amounts due to the Certificateholders,
and the performance or observance of every agreement and covenant of
this Indenture on the part of the Issuer to be performed or observed,
all as provided herein;
(ii) immediately after giving effect to such
transaction, no Default or Event of Default shall have occurred and be
continuing;
(iii) the Rating Agencies shall have notified the
Issuer that such transaction shall not cause the rating of the Notes to
be reduced, suspended or withdrawn or to be considered by either Rating
Agency to be below investment grade;
(iv) the Issuer shall have received an Opinion of
Counsel (and shall have delivered a copy thereof to the Indenture
Trustee) to the effect that such transaction will not (A) result in a
"substantial modification" of the Notes under Treasury Regulation
section 1.1001-3, or adversely affect the status of the Notes as
indebtedness for federal income tax purposes, or (B) if 100% of the
Certificates are not owned by American Home Mortgage Securities LLC,
cause the Trust to be subject to an entity level tax for federal income
tax purposes;
(v) any action that is necessary to maintain the lien
and security interest created by this Indenture shall have been taken;
19
(vi) the Issuer shall have delivered to the Indenture
Trustee an Officer's Certificate and an Opinion of Counsel each stating
that such consolidation or merger and such supplemental indenture
comply with this Article III and that all conditions precedent herein
provided for or relating to such transaction have been complied with
(including any filing required by the Exchange Act), and that such
supplemental indenture is enforceable.
(b) The Issuer shall not convey or transfer any of its properties or
assets, including those included in the Trust Estate, to any Person, unless:
(i) the Person that acquires by conveyance or
transfer the properties and assets of the Issuer, the conveyance or
transfer of which is hereby restricted, shall (A) be a United States
citizen or a Person organized and existing under the laws of the United
States of America or any state thereof, (B) expressly assume, by an
indenture supplemental hereto, executed and delivered to the Indenture
Trustee, in form satisfactory to the Indenture Trustee, the due and
punctual payment of the principal of and interest on all Notes and the
performance or observance of every agreement and covenant of this
Indenture on the part of the Issuer to be performed or observed, all as
provided herein, (C) expressly agree by means of such supplemental
indenture that all right, title and interest so conveyed or transferred
shall be subject and subordinate to the rights of the Holders of the
Notes, (D) unless otherwise provided in such supplemental indenture,
expressly agree to indemnify, defend and hold harmless the Issuer, the
Indenture Trustee against and from any loss, liability or expense
arising under or related to this Indenture and the Notes and (E)
expressly agree by means of such supplemental indenture that such
Person (or if a group of Persons, then one specified Person) shall make
all filings with the Commission (and any other appropriate Person)
required by the Exchange Act in connection with the Notes;
(ii) immediately after giving effect to such
transaction, no Default or Event of Default shall have occurred and be
continuing;
(iii) the Rating Agencies shall have notified the
Issuer that such transaction shall not cause the rating of the Notes,
to be reduced, suspended or withdrawn;
(iv) the Issuer shall have received an Opinion of
Counsel (and shall have delivered a copy thereof to the Indenture
Trustee) to the effect that such transaction will not (A) result in a
"substantial modification" of the Notes under Treasury Regulation
section 1.1001-3, or adversely affect the status of the Notes as
indebtedness for federal income tax purposes, or (B) if 100% of the
Certificates are not owned by AHM SPV III, LLC, cause the Trust to be
subject to an entity level tax for federal income tax purposes;
(v) any action that is necessary to maintain the lien
and security interest created by this Indenture shall have been taken;
(vi) the Issuer shall have delivered to the Indenture
Trustee an Officer's Certificate and an Opinion of Counsel each stating
that such conveyance or transfer and such supplemental indenture comply
with this Article III and that all conditions precedent herein
20
provided for relating to such transaction have been complied with
(including any filing required by the Exchange Act).
Section 3.17 SUCCESSOR OR TRANSFEREE. (a) Upon any consolidation or
merger of the Issuer in accordance with Section 3.16(a), the Person formed by or
surviving such consolidation or merger (if other than the Issuer) shall succeed
to, and be substituted for, and may exercise every right and power of, the
Issuer under this Indenture with the same effect as if such Person had been
named as the Issuer herein.
(b) Upon a conveyance or transfer of all the assets and properties of
the Issuer pursuant to Section 3.16(b), the Issuer will be released from every
covenant and agreement of this Indenture to be observed or performed on the part
of the Issuer with respect to the Notes immediately upon the delivery of written
notice to the Indenture Trustee of such conveyance or transfer.
Section 3.18 NO OTHER BUSINESS. The Issuer shall not engage in any
business other than financing, purchasing, owning and selling and managing the
Mortgage Loans and the issuance of the Notes and Certificates in the manner
contemplated by this Indenture and the Basic Documents and all activities
incidental thereto.
Section 3.19 NO BORROWING. The Issuer shall not issue, incur, assume,
guarantee or otherwise become liable, directly or indirectly, for any
indebtedness except for the Notes under this Indenture.
Section 3.20 GUARANTEES, LOANS, ADVANCES AND OTHER LIABILITIES. Except
as contemplated by this Indenture or the Basic Documents, the Issuer shall not
make any loan or advance or credit to, or guarantee (directly or indirectly or
by an instrument having the effect of assuring another's payment or performance
on any obligation or capability of so doing or otherwise), endorse or otherwise
become contingently liable, directly or indirectly, in connection with the
obligations, stocks or dividends of, or own, purchase, repurchase or acquire (or
agree contingently to do so) any stock, obligations, assets or securities of, or
any other interest in, or make any capital contribution to, any other Person.
Section 3.21 CAPITAL EXPENDITURES. The Issuer shall not make any
expenditure (by long-term or operating lease or otherwise) for capital assets
(either realty or personalty).
Section 3.22 DETERMINATION OF NOTE INTEREST RATE. On each Interest
Determination Date the Indenture Trustee shall determine One-Month LIBOR,
Six-Month LIBOR and One-Year LIBOR and the related Note Interest Rate for each
Class of Notes for the following Accrual Period and shall make such information
available to the Issuer, the Master Servicer, and the Depositor. The
establishment of One-Month LIBOR, Six-Month LIBOR and One-Year LIBOR on each
Interest Determination Date by the Indenture Trustee and the Indenture Trustee's
calculation of the rate of interest applicable to each Class of Notes for the
related Accrual Period shall (in the absence of manifest error) be final and
binding.
Section 3.23 RESTRICTED PAYMENTS. The Issuer shall not, directly or
indirectly, (i) pay any dividend or make any distribution (by reduction of
capital or otherwise), whether in cash, property,
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securities or a combination thereof, to the Owner Trustee or any owner of a
beneficial interest in the Issuer or otherwise with respect to any ownership or
equity interest or security in or of the Issuer, (ii) redeem, purchase, retire
or otherwise acquire for value any such ownership or equity interest or security
or (iii) set aside or otherwise segregate any amounts for any such purpose;
PROVIDED, HOWEVER, that the Issuer may make, or cause to be made, (x)
distributions and payments to the Owner Trustee, the Indenture Trustee, the
Certificate Registrar, the Certificate Paying Agent, the Noteholders and the
Certificateholders as contemplated by, and to the extent funds are available for
such purpose under this Indenture and the Trust Agreement and (y) payments to
the Master Servicer and the Subservicers pursuant to the terms of the Servicing
Agreement. The Issuer will not, directly or indirectly, make payments to or
distributions from the Collection Account except in accordance with this
Indenture and the Basic Documents.
Section 3.24 NOTICE OF EVENTS OF DEFAULT. The Issuer shall give the
Indenture Trustee and the Rating Agencies prompt written notice of each Event of
Default hereunder and under the Trust Agreement.
Section 3.25 FURTHER INSTRUMENTS AND ACTS. Upon request of the
Indenture Trustee, the Issuer will execute and deliver such further instruments
and do such further acts as may be reasonably necessary or proper to carry out
more effectively the purpose of this Indenture.
Section 3.26 STATEMENTS TO NOTEHOLDERS. On each Payment Date, the
Indenture Trustee shall make available on the Indenture Trustee's website,
xxx.xxxxxxx.xxx (or deliver at the recipient's option), to each Noteholder and
Certificateholder the statement prepared by the Indenture Trustee pursuant to
and in the manner provided for in Section 7.05 hereof.
Section 3.27 [RESERVED].
Section 3.28 CERTAIN REPRESENTATIONS REGARDING THE TRUST ESTATE.
(a) With respect to that portion of the Collateral described in clauses
(a) through (c) of the definition of Trust Estate, the Issuer represents to the
Indenture Trustee that:
(i) This Indenture creates a valid and continuing security
interest (as defined in the applicable UCC) in the Collateral in favor of the
Indenture Trustee, which security interest is prior to all other liens, and is
enforceable as such as against creditors of and purchasers from the Issuer.
(ii) The Collateral constitutes "deposit accounts" or
"instruments," as applicable, within the meaning of the applicable UCC.
(iii) The Issuer owns and has good and marketable title to the
Collateral, free and clear of any lien, claim or encumbrance of any Person.
(iv) The Issuer has taken all steps necessary to cause the
Indenture Trustee to become the account holder of the Collateral.
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(v) Other than the security interest granted to the Indenture
Trustee pursuant to this Indenture, the Issuer has not pledged, assigned, sold,
granted a security interest in, or otherwise conveyed any of the Collateral.
(vi) The Collateral is not in the name of any Person other
than the Issuer or the Indenture Trustee. The Issuer has not consented to the
bank maintaining the Collateral to comply with instructions of any Person other
than the Indenture Trustee.
(b) With respect to that portion of the Collateral described in clauses
(d) and (e), the Issuer represents to the Indenture Trustee that:
(i) This Indenture creates a valid and continuing security
interest (as defined in the applicable UCC) in the Collateral in favor of the
Indenture Trustee, which security interest is prior to all other liens, and is
enforceable as such as against creditors of and purchasers from the Issuer.
(ii) The Collateral constitutes "general intangibles" within
the meaning of the applicable UCC.
(iii) The Issuer owns and has good and marketable title to the
Collateral, free and clear of any lien, claim or encumbrance of any Person.
(iv) Other than the security interest granted to the Indenture
Trustee pursuant to this Indenture, the Issuer has not pledged, assigned, sold,
granted a security interest in, or otherwise conveyed any of the Collateral.
(c) With respect to any Collateral in which a security interest may be
perfected by filing, the Issuer has not authorized the filing of, and is not
aware of any financing statements against, the Issuer, that include a
description of collateral covering such Collateral, other than any financing
statement relating to the security interest granted to the Indenture Trustee
hereunder or that has been terminated. The Issuer is not aware of any judgment
or tax lien filings against the Issuer.
(d) The Issuer has caused or will have caused, within ten days, the
filing of all appropriate financing statements in the proper filing office in
the appropriate jurisdictions under applicable law in order to perfect the
security interest in all Collateral granted to the Indenture Trustee hereunder
in which a security interest may be perfected by filing. Any financing statement
that is filed in connection with this Section 3.28 shall contain a statement
that a purchase or security interest in any collateral described therein will
violate the rights of the secured party named in such financing statement.
(e) The foregoing representations may not be waived and shall survive
the issuance of the Notes.
Section 3.29 ALLOCATION OF REALIZED LOSSES. (a) Any Realized Losses on
the Mortgage Loans will be allocated or covered on any Payment Date as follows:
FIRST, to the related Net Monthly Excess Cashflow, by an increase in the related
Overcollateralization Increase Amount for that
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Payment Date as provided in Section 3.05 of this Indenture; SECOND, to the
non-related Net Monthly Excess Cashflow, to the extent described in Section 3.05
of this Indenture above; THIRD, in reduction of the Overcollateralized Amount
for related and non-related Loan Groups, until reduced to zero (meaning, no
losses will be allocated to the Class M Notes until the aggregate Note Principal
Balance of the Notes equals the aggregate Stated Principal Balance of the
Mortgage Loans); and FOURTH, (i) if such Realized Loss is on a Group I Loan, to
the Class I-M-3, Class I-M-2 and Class I-M- 1 Notes, in that order, in reduction
of the Note Principal Balances thereof, until reduced to zero; (ii) if such
Realized Loss is on a Group II Loan, to the Class II-M-3, Class II-M-2 and Class
II-M-1 Notes, in that order, in reduction of the Note Principal Balances
thereof, until reduced to zero; (iii) if such Realized Loss is on a Group III
Loan, to the Class III-M-2 Notes and Class III-M-1 Notes, in that order, in
reduction of the Note Principal Balances thereof, until reduced to zero; and
(iv) if such Realized Loss is on a Group IV Loan, to the Class IV-M-3, Class
IV-M-2 and Class IV-M-1 Notes, in that order, in reduction of the Note Principal
Balances thereof, until reduced to zero. For purposes of clause THIRD all
Realized Losses will be allocated among all Loan Groups to their respective
Overcollateralization Amounts on a pro rata basis, based on the amount of
Realized Losses incurred during the related Prepayment Period which were not
covered on that Payment Date through a payment of Net Monthly Excess Cashflow,
until the aggregate Note Principal Balance of the Notes equals the aggregate
Stated Principal Balance of the Mortgage Loans (even if this results in an
Undercollateralization Amount) before being allocated to the related Notes as
provided in clause FOURTH. Realized Losses shall not be allocated to the Class A
Notes. All Realized Losses allocated to a Class of Notes will be allocated in
proportion to the Percentage Interests evidenced thereby.
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ARTICLE IV
The Notes; Satisfaction and Discharge of Indenture
Section 4.01 THE NOTES. Each Class of Notes shall be registered in the
name of a nominee designated by the Depository. Beneficial Owners will hold
interests in the Notes through the book- entry facilities of the Depository in
minimum initial Note Principal Balances of $25,000 and integral multiples of $1
in excess thereof.
The Indenture Trustee may for all purposes (including the making of
payments due on the Notes) deal with the Depository as the authorized
representative of the Beneficial Owners with respect to the Notes for the
purposes of exercising the rights of Holders of the Notes hereunder. Except as
provided in the next succeeding paragraph of this Section 4.01, the rights of
Beneficial Owners with respect to the Notes shall be limited to those
established by law and agreements between such Beneficial Owners and the
Depository and Depository Participants. Except as provided in Section 4.08
hereof, Beneficial Owners shall not be entitled to definitive certificates for
the Notes as to which they are the Beneficial Owners. Requests and directions
from, and votes of, the Depository as Holder of the Notes shall not be deemed
inconsistent if they are made with respect to different Beneficial Owners. The
Indenture Trustee may establish a reasonable record date in connection with
solicitations of consents from or voting by Noteholders and give notice to the
Depository of such record date. Without the consent of the Issuer and the
Indenture Trustee, no Note may be transferred by the Depository except to a
successor Depository that agrees to hold such Note for the account of the
Beneficial Owners.
In the event the Depository Trust Company resigns or is removed as
Depository, the Indenture Trustee with the approval of the Issuer may appoint a
successor Depository. If no successor Depository has been appointed within 30
days of the effective date of the Depository's resignation or removal, each
Beneficial Owner shall be entitled to certificates representing the Notes it
beneficially owns in the manner prescribed in Section 4.08.
The Notes shall, on original issue, be executed on behalf of the Issuer
by the Owner Trustee, not in its individual capacity but solely as Owner
Trustee, authenticated by the Indenture Trustee and delivered by the Indenture
Trustee to or upon the order of the Issuer.
Section 4.02 REGISTRATION OF AND LIMITATIONS ON TRANSFER AND EXCHANGE
OF NOTES; APPOINTMENT OF NOTE REGISTRAR AND CERTIFICATE REGISTRAR. The Issuer
shall cause to be kept at the Corporate Trust Office a Note Register in which,
subject to such reasonable regulations as it may prescribe, the Note Registrar
shall provide for the registration of Notes and of transfers and exchanges of
Notes as herein provided.
Subject to the restrictions and limitations set forth below, upon
surrender for registration of transfer of any Note at the Corporate Trust
Office, the Issuer shall execute and the Note Registrar shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Notes in authorized initial Note Principal Balances evidencing the same
Class and aggregate Percentage Interests.
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Subject to the foregoing, at the option of the Noteholders, Notes may
be exchanged for other Notes of like tenor and in authorized initial Note
Principal Balances evidencing the same Class and aggregate Percentage Interests
upon surrender of the Notes to be exchanged at the Corporate Trust Office of the
Note Registrar. Whenever any Notes are so surrendered for exchange, the Issuer
shall execute and the Indenture Trustee shall authenticate and deliver the Notes
which the Noteholder making the exchange is entitled to receive. Each Note
presented or surrendered for registration of transfer or exchange shall (if so
required by the Note Registrar) be duly endorsed by, or be accompanied by a
written instrument of transfer in form reasonably satisfactory to the Note
Registrar duly executed by the Holder thereof or his attorney duly authorized in
writing with such signature guaranteed by a commercial bank or trust company
located or having a correspondent located in the city of New York. Notes
delivered upon any such transfer or exchange will evidence the same obligations,
and will be entitled to the same rights and privileges, as the Notes
surrendered.
No service charge shall be made for any registration of transfer or
exchange of Notes, but the Note Registrar shall require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any registration of transfer or exchange of Notes.
The Issuer hereby appoints the Indenture Trustee as (i) Certificate
Registrar to keep at its Corporate Trust Office a Certificate Register pursuant
to Section 3.09 of the Trust Agreement in which, subject to such reasonable
regulations as it may prescribe, the Certificate Registrar shall provide for the
registration of Certificates and of transfers and exchanges thereof pursuant to
Section 3.05 of the Trust Agreement and (ii) Note Registrar under this
Indenture. The Indenture Trustee hereby accepts such appointments.
Section 4.03 MUTILATED, DESTROYED, LOST OR STOLEN NOTES. If (i) any
mutilated Note is surrendered to the Indenture Trustee, or the Indenture Trustee
receives evidence to its satisfaction of the destruction, loss or theft of any
Note, and (ii) there is delivered to the Indenture Trustee such security or
indemnity as may be required by it to hold the Issuer and the Indenture Trustee
harmless, then, in the absence of notice to the Issuer, the Note Registrar or
the Indenture Trustee that such Note has been acquired by a bona fide purchaser,
and provided that the requirements of Section 8-405 of the UCC are met, the
Issuer shall execute, and upon its request the Indenture Trustee shall
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Note, a replacement Note; PROVIDED, HOWEVER, that if
any such destroyed, lost or stolen Note, but not a mutilated Note, shall have
become or within seven days shall be due and payable, instead of issuing a
replacement Note, the Issuer may pay such destroyed, lost or stolen Note when so
due or payable without surrender thereof. If, after the delivery of such
replacement Note or payment of a destroyed, lost or stolen Note pursuant to the
proviso to the preceding sentence, a bona fide purchaser of the original Note in
lieu of which such replacement Note was issued presents for payment such
original Note, the Issuer and the Indenture Trustee shall be entitled to recover
such replacement Note (or such payment) from the Person to whom it was delivered
or any Person taking such replacement Note from such Person to whom such
replacement Note was delivered or any assignee of such Person, except a bona
fide purchaser, and shall be entitled to recover upon the security or indemnity
provided therefor to the extent of any loss, damage, cost or expense incurred by
the Issuer or the Indenture Trustee in connection therewith.
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Upon the issuance of any replacement Note under this Section 4.03, the
Issuer may require the payment by the Holder of such Note of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other reasonable expenses (including the fees and expenses of
the Indenture Trustee) connected therewith.
Every replacement Note issued pursuant to this Section 4.03 in
replacement of any mutilated, destroyed, lost or stolen Note shall constitute an
original additional contractual obligation of the Issuer, whether or not the
mutilated, destroyed, lost or stolen Note shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Notes duly issued hereunder.
The provisions of this Section 4.03 are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Notes.
Section 4.04 PERSONS DEEMED OWNERS. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Indenture Trustee, the
Paying Agent and any agent of the Issuer or the Indenture Trustee may treat the
Person in whose name any Note is registered (as of the day of determination) as
the owner of such Note for the purpose of receiving payments of principal of and
interest, if any, on such Note and for all other purposes whatsoever, whether or
not such Note be overdue, and neither the Issuer, the Indenture Trustee, the
Paying Agent nor any agent of the Issuer or the Indenture Trustee shall be
affected by notice to the contrary.
Section 4.05 CANCELLATION. All Notes surrendered for payment,
registration of transfer, exchange or redemption shall, if surrendered to any
Person other than the Indenture Trustee, be delivered to the Indenture Trustee
and shall be promptly cancelled by the Indenture Trustee. The Issuer may at any
time deliver to the Indenture Trustee for cancellation any Notes previously
authenticated and delivered hereunder which the Issuer may have acquired in any
manner whatsoever, and all Notes so delivered shall be promptly cancelled by the
Indenture Trustee. No Notes shall be authenticated in lieu of or in exchange for
any Notes cancelled as provided in this Section 4.05, except as expressly
permitted by this Indenture. All cancelled Notes may be held or disposed of by
the Indenture Trustee in accordance with its standard retention or disposal
policy as in effect at the time unless the Issuer shall direct by an Issuer
Request that they be destroyed or returned to it; PROVIDED, HOWEVER, that such
Issuer Request is timely and the Notes have not been previously disposed of by
the Indenture Trustee.
Section 4.06 BOOK-ENTRY NOTES. The Notes, upon original issuance, will
be issued in the form of typewritten Notes representing the Book-Entry Notes, to
be delivered to The Depository Trust Company, the initial Depository, by, or on
behalf of, the Issuer. The Notes shall initially be registered on the Note
Register in the name of Cede & Co., the nominee of the initial Depository, and
no Beneficial Owner will receive a Definitive Note representing such Beneficial
Owner's interest in such Note, except as provided in Section 4.08. With respect
to such Notes, unless and until definitive, fully registered Notes (the
"Definitive Notes") have been issued to Beneficial Owners pursuant to Section
4.08:
(i) the provisions of this Section 4.06 shall be in
full force and effect;
27
(ii) the Note Registrar, the Paying Agent and the
Indenture Trustee shall be entitled to deal with the Depository for all
purposes of this Indenture (including the payment of principal of and
interest on the Notes and the giving of instructions or directions
hereunder) as the sole holder of the Notes, and shall have no
obligation to the Beneficial Owners of the Notes;
(iii) to the extent that the provisions of this
Section 4.06 conflict with any other provisions of this Indenture, the
provisions of this Section 4.06 shall control;
(iv) the rights of Beneficial Owners shall be
exercised only through the Depository and shall be limited to those
established by law and agreements between such Owners of Notes and the
Depository and/or the Depository Participants. Unless and until
Definitive Notes are issued pursuant to Section 4.08, the initial
Depository will make book- entry transfers among the Depository
Participants and receive and transmit payments of principal of and
interest on the Notes to such Depository Participants; and
(v) whenever this Indenture requires or permits
actions to be taken based upon instructions or directions of Holders of
Notes evidencing a specified percentage of the Note Principal Balances
of the Notes, the Depository shall be deemed to represent such
percentage with respect to the Notes only to the extent that it has
received instructions to such effect from Beneficial Owners and/or
Depository Participants owning or representing, respectively, such
required percentage of the beneficial interest in the Notes and has
delivered such instructions to the Indenture Trustee.
Section 4.07 NOTICES TO DEPOSITORY. Whenever a notice or other
communication to the Note Holders is required under this Indenture, unless and
until Definitive Notes shall have been issued to Beneficial Owners pursuant to
Section 4.08, the Indenture Trustee shall give all such notices and
communications specified herein to be given to Holders of the Notes to the
Depository, and shall have no obligation to the Beneficial Owners.
Section 4.08 DEFINITIVE NOTES. If (i) the Depositor advises the
Indenture Trustee or the Note Registrar in writing that the Depository is no
longer willing or able to properly discharge its responsibilities as clearing
agency with respect to the Notes and the Depositor is unable to locate a
qualified successor within 30 days, (ii) the Depositor, at its option (with the
consent of the Indenture Trustee, which consent shall not by unreasonably
withheld), elects to terminate the book-entry system through the Depository or
(iii) after the occurrence of an Event of Default, Beneficial Owners of Notes
representing beneficial interests aggregating at least a majority of the Note
Principal Balances of the Notes advise the Depository in writing that the
continuation of a book-entry system through the Depository is no longer in the
best interests of the Beneficial Owners, then the Note Registrar shall request
that the Depository notify all Beneficial Owners and the Indenture Trustee of
the occurrence of any such event and of the availability of Definitive Notes to
Beneficial Owners requesting the same. Upon surrender to the Indenture Trustee
of the global Note or definitive typewritten Notes representing the Book-Entry
Notes by the Depository, accompanied by registration instructions, the Note
Registrar will re-issue the Book-entry Notes as Definitive Notes issued in the
respective Note Principal Balances owned by individual Note Owners. None of the
Issuer, the Note Registrar or the Indenture Trustee shall be liable for any
delay in delivery of such instructions and may conclusively rely on, and shall
be
28
protected in relying on, such instructions. Upon the issuance of Definitive
Notes, the Indenture Trustee shall recognize the Holders of the Definitive Notes
as Noteholders.
Section 4.09 TAX TREATMENT. The Issuer has entered into this Indenture,
and the Notes will be issued with the intention that, for federal, state and
local income, single business and franchise tax purposes, the Notes will qualify
as indebtedness. The Issuer and the Indenture Trustee (in accordance with
Section 6.06 hereof), by entering into this Indenture, and each Noteholder, by
its acceptance of its Note (and each Beneficial Owner by its acceptance of an
interest in the applicable Book-Entry Note), agree to treat the Notes for
federal, state and local income, single business and franchise tax purposes as
indebtedness.
Section 4.10 SATISFACTION AND DISCHARGE OF INDENTURE. This Indenture
shall cease to be of further effect with respect to the Notes except as to (i)
rights of registration of transfer and exchange, (ii) substitution of mutilated,
destroyed, lost or stolen Notes, (iii) rights of Noteholders to receive payments
of principal thereof and interest thereon, (iv) Sections 3.03, 3.04, 3.06, 3.09,
3.17, 3.19 and 3.20, (v) the rights, obligations and immunities of the Indenture
Trustee hereunder (including the rights of the Indenture Trustee under Section
6.07 and the obligations of the Indenture Trustee under Section 4.11), and (vi)
the rights of Noteholders as beneficiaries hereof with respect to the property
so deposited with the Indenture Trustee payable to all or any of them, and the
Indenture Trustee, on demand of and at the expense of the Issuer, shall execute
proper instruments acknowledging satisfaction and discharge of this Indenture
with respect to the Notes and shall release and deliver the Collateral to or
upon the order of the Issuer, when
(A) either
(1) all Notes theretofore authenticated and delivered (other
than (i) Notes that have been destroyed, lost or stolen and that have
been replaced or paid as provided in Section 4.03 hereof and (ii) Notes
for whose payment money has theretofore been deposited in trust or
segregated and held in trust by the Issuer and thereafter repaid to the
Issuer or discharged from such trust, as provided in Section 3.03) have
been delivered to the Indenture Trustee for cancellation; or
(2) all Notes not theretofore delivered to the Indenture
Trustee for cancellation
a. have become due and payable,
b. will become due and payable at the Final
Scheduled Payment Date within one year, or
c. have been called for early redemption and the
Trust has been terminated pursuant to Section
8.07 hereof,
and the Issuer, in the case of a. or b. above, has irrevocably deposited or
caused to be irrevocably deposited with the Indenture Trustee cash or direct
obligations of or obligations guaranteed by the United States of America (which
will mature prior to the date such amounts are payable), in trust for such
purpose, in an amount sufficient to pay and discharge the entire indebtedness on
such Notes
29
then outstanding not theretofore delivered to the
Indenture Trustee for cancellation when due on the Final Scheduled Payment Date
or other final Payment Date and has delivered to the Indenture Trustee a
verification report from a nationally recognized accounting firm certifying that
the amounts deposited with the Indenture Trustee are sufficient to pay and
discharge the entire indebtedness of such Notes, or, in the case of c. above,
the Issuer shall have complied with all requirements of Section 8.07 hereof,
(B) the Issuer has paid or caused to be paid all other sums
payable hereunder; and
(C) the Issuer has delivered to the Indenture Trustee an
Officer's Certificate and an Opinion of Counsel, each meeting the
applicable requirements of Section 10.01 hereof, each stating that all
conditions precedent herein provided for relating to the satisfaction
and discharge of this Indenture have been complied with and, if the
Opinion of Counsel relates to a deposit made in connection with Section
4.10(A)(2)b. above, such opinion shall further be to the effect that
such deposit will constitute an "in-substance defeasance" within the
meaning of Revenue Ruling 85-42, 1985-1 C.B. 36, and in accordance
therewith, the Issuer will be the owner of the assets deposited in
trust for federal income tax purposes.
Section 4.11 APPLICATION OF TRUST MONEY. All monies deposited with the
Indenture Trustee pursuant to Section 4.10 hereof shall be held in trust and
applied by it, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent or the
Issuer, Certificate Paying Agent as designee of the Issuer, as the Indenture
Trustee may determine, to the Holders of Securities, of all sums due and to
become due thereon for principal and interest or otherwise; but such monies need
not be segregated from other funds except to the extent required herein or
required by law.
Section 4.12 [RESERVED].
Section 4.13 REPAYMENT OF MONIES HELD BY PAYING AGENT. In connection
with the satisfaction and discharge of this Indenture with respect to the Notes,
all monies then held by any Person other than the Indenture Trustee under the
provisions of this Indenture with respect to such Notes shall, upon demand of
the Issuer, be paid to the Indenture Trustee to be held and applied according to
Section 3.05 and thereupon such Person shall be released from all further
liability with respect to such monies.
Section 4.14 TEMPORARY NOTES. Pending the preparation of any Definitive
Notes, the Issuer may execute and upon its written direction, the Indenture
Trustee may authenticate and make available for delivery, temporary Notes that
are printed, lithographed, typewritten, photocopied or otherwise produced, in
any denomination, substantially of the tenor of the Definitive Notes in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Notes may
determine, as evidenced by their execution of such Notes.
If temporary Notes are issued, the Issuer will cause Definitive Notes
to be prepared without unreasonable delay. After the preparation of the
Definitive Notes, the temporary Notes shall be exchangeable for Definitive Notes
upon surrender of the temporary Notes at the office of the
30
Indenture Trustee located at Sixth and Marquette, Minneapolis, Minnesota
55479-0113, Attention: Corporate Trust Services American Home Mortgage
Securities LLC, Series 2004-1, without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Notes, the Issuer shall execute and
the Indenture Trustee shall authenticate and make available for delivery, in
exchange therefor, Definitive Notes of authorized denominations and of like
tenor, class and aggregate principal amount. Until so exchanged, such temporary
Notes shall in all respects be entitled to the same benefits under this
Indenture as Definitive Notes.
Section 4.15 REPRESENTATION REGARDING ERISA. By acquiring a Note or
interest therein, each Holder of such Note or Beneficial Owner of any such
interest will be deemed to represent that either (1) it is not acquiring the
Note with Plan Assets or (2) (A) the acquisition, holding and transfer of such
Note will not give rise to a nonexempt prohibited transaction under Section 406
of ERISA or Section 4975 of the Code and (B) the Notes are rated investment
grade or better and such person believes that the Notes are properly treated as
indebtedness without substantial equity features for purposes of the Department
of Labor regulation 29 C.F.R. ss. 2510.3-101, and agrees to so treat the Notes.
Alternatively, regardless of the rating of the Notes, such person may provide
the Indenture Trustee and the Owner Trustee with an opinion of counsel, which
opinion of counsel will not be at the expense of the Issuer, the Seller, any
Underwriter, the Owner Trustee, the Indenture Trustee, the Master Servicer or
any successor servicer which opines that the acquisition, holding and transfer
of such Note or interest therein is permissible under applicable law, will not
constitute or result in a non-exempt prohibited transaction under ERISA or
Section 4975 of the Code and will not subject the Issuer, the Seller, the
Depositor, any Underwriter, the Owner Trustee, the Indenture Trustee, the Master
Servicer or any successor servicer to any obligation in addition to those
undertaken in the Indenture.
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ARTICLE V
Default and Remedies
Section 5.01 EVENTS OF DEFAULT. The Issuer shall deliver to the
Indenture Trustee, within five days after learning of the occurrence of a
Default, written notice in the form of an Officer's Certificate of any event
which with the giving of notice and the lapse of time would become an Event of
Default under clause (iii) or (iv) of the definition of "Event of Default", its
status and what action the Issuer is taking or proposes to take with respect
thereto. The Indenture Trustee shall not be deemed to have knowledge of any
Event of Default unless a Responsible Officer has actual knowledge thereof or
unless written notice of such Event of Default is received by a Responsible
Officer and such notice references the Notes, the Trust Estate or this
Indenture.
Section 5.02 ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT. If an
Event of Default should occur and be continuing, then and in every such case the
Indenture Trustee at the written direction of the Holders of Notes representing
not less than a majority of the aggregate Note Principal Balance of the Notes
may declare the Notes to be immediately due and payable, by a notice in writing
to the Issuer (and to the Indenture Trustee if such notice is given by
Noteholders), and upon any such declaration the unpaid Note Principal Balance of
the Notes, together with accrued and unpaid interest thereon through the date of
acceleration, shall become immediately due and payable.
At any time after such declaration of acceleration of maturity with
respect to an Event of Default has been made and before a judgment or decree for
payment of the money due has been obtained by the Indenture Trustee as
hereinafter in this Article V provided that, Holders of the Notes representing
not less than a majority of the aggregate Note Principal Balance of the Notes by
written notice to the Issuer and the Indenture Trustee, may waive the related
Event of Default and rescind and annul such declaration and its consequences if
(i) the Issuer has paid or deposited with the
Indenture Trustee a sum sufficient to pay:
(A) all payments of principal of and interest on the
Notes and all other amounts that would then be due hereunder
or under the Notes if the Event of Default giving rise to such
acceleration had not occurred;
(B) all sums paid or advanced by the Indenture
Trustee hereunder and the reasonable compensation, expenses,
disbursements and advances of the Indenture Trustee and its
agents and counsel; and
(ii) all Events of Default, other than the nonpayment
of the principal of the Notes that has become due solely by such
acceleration, have been cured or waived as provided in Section 5.12.
No such rescission shall affect any subsequent default or impair any right
consequent thereto.
Section 5.03 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
INDENTURE TRUSTEE.
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(a) The Issuer covenants that if (i) default is made in the payment of
any interest on any Note when the same becomes due and payable, and such default
continues for a period of five days, or (ii) default is made in the payment of
the principal of or any installment of the principal of any Note when the same
becomes due and payable, the Issuer shall, upon demand of the Indenture Trustee,
at the direction of the Holders of a majority of the aggregate Note Principal
Balances of the Notes, pay to the Indenture Trustee, for the benefit of the
Holders of Notes, the whole amount then due and payable on the Notes for
principal and interest, with interest at the applicable Note Interest Rate upon
the overdue principal, and in addition thereto such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Indenture
Trustee and its agents and counsel.
(b) In case the Issuer shall fail forthwith to pay such amounts upon
such demand, the Indenture Trustee, in its own name and as trustee of an express
trust, subject to the provisions of Section 10.16 hereof may institute a
Proceeding for the collection of the sums so due and unpaid, and may prosecute
such Proceeding to judgment or final decree, and may enforce the same against
the Issuer or other obligor upon the Notes and collect in the manner provided by
law out of the property of the Issuer or other obligor the Notes, wherever
situated, the monies adjudged or decreed to be payable.
(c) If an Event of Default occurs and is continuing, the Indenture
Trustee, subject to the provisions of Section 10.16 hereof may, as more
particularly provided in Section 5.04 hereof, in its discretion, proceed to
protect and enforce its rights and the rights of the Noteholders by such
appropriate Proceedings as directed in writing by Holders of a majority of the
aggregate Note Principal Balances of the Notes, to protect and enforce any such
rights, whether for the specific enforcement of any covenant or agreement in
this Indenture or in aid of the exercise of any power granted herein, or to
enforce any other proper remedy or legal or equitable right vested in the
Indenture Trustee by this Indenture or by law.
(d) In case there shall be pending, relative to the Issuer or any other
obligor upon the Notes or any Person having or claiming an ownership interest in
the Trust Estate, Proceedings under Title 11 of the United States Code or any
other applicable federal or state bankruptcy, insolvency or other similar law,
or in case a receiver, assignee or trustee in bankruptcy or reorganization,
liquidator, sequestrator or similar official shall have been appointed for or
taken possession of the Issuer or its property or such other obligor or Person,
or in case of any other comparable judicial Proceedings relative to the Issuer
or other obligor upon the Notes, or to the creditors or property of the Issuer
or such other obligor, the Indenture Trustee, as directed in writing by Holders
of a majority of the aggregate Note Principal Balances of the Notes,
irrespective of whether the principal of any Notes shall then be due and payable
as therein expressed or by declaration or otherwise and irrespective of whether
the Indenture Trustee shall have made any demand pursuant to the provisions of
this Section, shall be entitled and empowered, by intervention in such
Proceedings or otherwise:
(i) to file and prove a claim or claims for the whole
amount of principal and interest owing and unpaid in respect of the
Notes and to file such other papers or documents as may be necessary or
advisable in order to have the claims of the Indenture Trustee
(including any claim for reasonable compensation to the Indenture
Trustee and each predecessor Indenture Trustee, and their respective
agents, attorneys and counsel, and for
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reimbursement of all expenses and liabilities incurred, and all
advances made, by the Indenture Trustee and each predecessor Indenture
Trustee, except as a result of negligence or bad faith) and of the
Noteholders allowed in such Proceedings;
(ii) unless prohibited by applicable law and
regulations, to vote on behalf of the Holders of Notes in any election
of a trustee, a standby trustee or Person performing similar functions
in any such Proceedings;
(iii) to collect and receive any monies or other
property payable or deliverable on any such claims and to distribute
all amounts received with respect to the claims of the Noteholders and
of the Indenture Trustee on their behalf, and
(iv) to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims
of the Indenture Trustee or the Holders of Notes allowed in any
judicial proceedings relative to the Issuer, its creditors and its
property;
and any trustee, receiver, liquidator, custodian or other similar official in
any such Proceeding is hereby authorized by each of such Noteholders to make
payments to the Indenture Trustee, and, in the event that the Indenture Trustee
shall consent to the making of payments directly to such Noteholders, to pay to
the Indenture Trustee such amounts as shall be sufficient to cover reasonable
compensation to the Indenture Trustee, each predecessor Indenture Trustee and
their respective agents, attorneys and counsel, and all other expenses and
liabilities incurred, and all advances made, by the Indenture Trustee and each
predecessor Indenture Trustee.
(e) Nothing herein contained shall be deemed to authorize the Indenture
Trustee to authorize or consent to or vote for or accept or adopt on behalf of
any Noteholder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder thereof or to
authorize the Indenture Trustee to vote in respect of the claim of any
Noteholder in any such proceeding except, as aforesaid, to vote for the election
of a trustee in bankruptcy or similar Person.
(f) All rights of action and of asserting claims under this Indenture,
or under any of the Notes, may be enforced by the Indenture Trustee without the
possession of any of the Notes or the production thereof in any trial or other
Proceedings relative thereto, and any such action or proceedings instituted by
the Indenture Trustee shall be brought in its own name as trustee of an express
trust, and any recovery of judgment, subject to the payment of the expenses,
disbursements and compensation of the Indenture Trustee, each predecessor
Indenture Trustee and their respective agents and attorneys, shall be for the
ratable benefit of the Holders of the Notes, subject to Section 5.05 hereof.
(g) In any Proceedings brought by the Indenture Trustee (and also any
Proceedings involving the interpretation of any provision of this Indenture to
which the Indenture Trustee shall be a party), the Indenture Trustee shall be
held to represent all the Holders of the Notes, and it shall not be necessary to
make any Noteholder a party to any such Proceedings.
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Section 5.04 REMEDIES; PRIORITIES. (a) If an Event of Default shall
have occurred and be continuing and if an acceleration has been declared and not
rescinded pursuant to Section 5.02 hereof, the Indenture Trustee subject to the
provisions of Section 10.16 hereof may do one or more of the following (subject
to Section 5.05 hereof):
(i) institute Proceedings in its own name and as
trustee of an express trust for the collection of all amounts then
payable on the Notes or under this Indenture with respect thereto,
whether by declaration or otherwise, and all amounts payable under the
Insurance Agreement, enforce any judgment obtained, and collect from
the Issuer and any other obligor upon such Notes monies adjudged due;
(ii) institute Proceedings from time to time for the
complete or partial foreclosure of this Indenture with respect to the
Trust Estate;
(iii) exercise any remedies of a secured party under
the UCC and take any other appropriate action to protect and enforce
the rights and remedies of the Indenture Trustee and the Holders of the
Notes; and
(iv) sell the Trust Estate or any portion thereof or
rights or interest therein, at one or more public or private sales
called and conducted in any manner permitted by law;
PROVIDED, HOWEVER, that the Indenture Trustee may not sell or otherwise
liquidate the Trust Estate following an Event of Default, unless (A) the
Indenture Trustee obtains the consent of the Holders of 100% of the aggregate
Note Principal Balance of the Notes, (B) the proceeds of such sale or
liquidation distributable to the Holders of the Notes are sufficient to
discharge in full all amounts then due and unpaid upon such Notes for principal
and interest or (C) the Indenture Trustee determines that the Mortgage Loans
will not continue to provide sufficient funds for the payment of principal of
and interest on the applicable Notes as they would have become due if the Notes
had not been declared due and payable, and the Indenture Trustee obtains the
consent of the Holders of a majority of the aggregate Note Principal Balance of
the Notes. In determining such sufficiency or insufficiency with respect to
clause (B) and (C), the Indenture Trustee may, but need not, obtain and rely
upon an opinion (obtained at the expense of the Trust) of an Independent
investment banking or accounting firm of national reputation as to the
feasibility of such proposed action and as to the sufficiency of the Trust
Estate for such purpose. Notwithstanding the foregoing, so long as an Event of
Servicer Termination has not occurred, any Sale of the Trust Estate shall be
made subject to the continued servicing of the Mortgage Loans by the Master
Servicer as provided in the Servicing Agreement.
(b) If the Indenture Trustee collects any money or property with
respect to the Group I Loans, Group II Loans, Group III Loans or Group IV Loans
pursuant to this Article V, it shall pay out the money or property in the
following order:
FIRST: to the Indenture Trustee and Master Servicer for
amounts due under Section 6.07 hereof;
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SECOND: to the Noteholders for amounts due and unpaid on the
Notes (other than Basis Risk Shortfall Carry-Forward Amounts and Net
WAC Shortfall Carry-Forward Amounts) with respect to interest, first,
to the Class I-A, Class II-A, Class III-A and Class IV-A Noteholders,
concurrently, and second, to the Class I-M-1, Class II-M-1, Class
III-M-1 and Class IV-M-1 Noteholders, concurrently, third, to the Class
I-M-2, Class II-M-2, Class III-M-2 and Class IV-M-2 Noteholders,
concurrently, and fourth, to the Class I-M-3, Class II-M-3 and Class
IV-M-3 Noteholders, concurrently, according to the amounts due and
payable on the Notes for interest;
THIRD: to Noteholders for amounts due and unpaid on the
Noteholders with respect to principal, and to each Noteholder ratably,
without preference or priority of any kind, according to the amounts
due and payable on such Notes for principal, until the Note Principal
Balance of each such Class is reduced to zero;
FOURTH: to the related Class M Notes, in order of payment
priority, the amount of any related Allocated Realized Loss Amount not
previously paid;
FIFTH: to the Noteholders for Basis Risk Shortfall
Carry-Forward Amounts and Net WAC Shortfall Carry-Forward Amounts, with
respect to amounts remaining with respect to the Group I Loans,
sequentially, to the Class I-A, Class I-M-1, Class I-M-2 and Class
I-M-3 Noteholders, with respect to amounts remaining with respect to
the Group II Loans, sequentially, to the Class II-A, Class II-M-1,
Class II-M-2 and Class II-M-3 Noteholders, with respect to amounts
remaining with respect to the Group III Loans, sequentially, to the
Class III-A, Class III-M-1 and Class III-M-2 Noteholders, and with
respect to amounts remaining with respect to the Group IV Loans,
sequentially, to the Class IV-A, Class IV-M- 1, Class IV-M-2 and Class
IV-M-3 Noteholders; and
SIXTH: to the payment of the remainder, if any, to the holders
of the Trust Certificates on behalf of the Issuer.
The Indenture Trustee may fix a record date and Payment Date for any
payment to Noteholders pursuant to this Section 5.04. At least 15 days before
such record date, the Indenture Trustee shall mail to each Noteholder a notice
that states the record date, the Payment Date and the amount to be paid.
Section 5.05 OPTIONAL PRESERVATION OF THE TRUST ESTATE. If the Notes
have been declared to be due and payable under Section 5.02 following an Event
of Default and such declaration and its consequences have not been rescinded and
annulled, the Indenture Trustee may elect to take and maintain possession of the
Trust Estate. It is the desire of the parties hereto and the Noteholders that
there be at all times sufficient funds for the payment of principal of and
interest on the Notes and other obligations of the Issuer and the Indenture
Trustee, shall take such desire into account when determining whether or not to
take and maintain possession of the Trust Estate. In determining whether to take
and maintain possession of the Trust Estate, the Indenture Trustee may, but need
not, obtain and rely upon an opinion of an Independent investment banking or
accounting firm of national reputation as to the feasibility of such proposed
action and as to the sufficiency of the Trust Estate for such purpose.
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Section 5.06 LIMITATION OF SUITS. No Holder of any Note shall have any
right to institute any Proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless and subject to the provisions of Section 10.16 hereof
(i) such Holder has previously given written notice
to the Indenture Trustee of a continuing Event of Default;
(ii) the Holders of not less than 25% of the
aggregate Note Principal Balances of the Notes have made a written
request to the Indenture Trustee to institute such Proceeding in
respect of such Event of Default in its own name as Indenture Trustee
hereunder;
(iii) such Holder or Holders have offered to the
Indenture Trustee reasonable indemnity against the costs, expenses and
liabilities to be incurred in complying with such request;
(iv) the Indenture Trustee for 60 days after its
receipt of such notice of request and offer of indemnity has failed to
institute such Proceedings; and
(v) no direction inconsistent with such written
request has been given to the Indenture Trustee during such 60-day
period by the Holders of a majority of the Note Principal Balances of
the Notes.
It is understood and intended that no one or more Holders of Notes shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other
Holders of Notes or to obtain or to seek to obtain priority or preference over
any other Holders or to enforce any right under this Indenture, except in the
manner herein provided.
Subject to the last paragraph of Section 5.11 herein, in the event the
Indenture Trustee shall receive conflicting or inconsistent requests and
indemnity from two or more groups of Holders of Notes, each representing less
than a majority of the Note Principal Balances of the Notes, the Indenture
Trustee in its sole discretion may determine what action, if any, shall be
taken, notwithstanding any other provisions of this Indenture.
Section 5.07 UNCONDITIONAL RIGHTS OF NOTEHOLDERS TO RECEIVE PRINCIPAL
AND INTEREST. Notwithstanding any other provisions in this Indenture, the Holder
of any Note shall have the right, which is absolute and unconditional, to
receive payment of the principal of and interest, if any, on such Note on or
after the respective due dates thereof expressed in such Note or in this
Indenture and to institute suit for the enforcement of any such payment, and
such right shall not be impaired without the consent of such Holder.
Section 5.08 RESTORATION OF RIGHTS AND REMEDIES. If the Indenture
Trustee or any Noteholder has instituted any Proceeding to enforce any right or
remedy under this Indenture and such Proceeding has been discontinued or
abandoned for any reason or has been determined
37
adversely to the Indenture Trustee or to such Noteholder, then and in every such
case the Issuer, the Indenture Trustee and the Noteholders shall, subject to any
determination in such Proceeding, be restored severally and respectively to
their former positions hereunder, and thereafter all rights and remedies of the
Indenture Trustee and the Noteholders shall continue as though no such
Proceeding had been instituted.
Section 5.09 RIGHTS AND REMEDIES CUMULATIVE. No right or remedy herein
conferred upon or reserved to the Indenture Trustee or to the Noteholders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
Section 5.10 DELAY OR OMISSION NOT A WAIVER. No delay or omission of
the Indenture Trustee or any Holder of any Note to exercise any right or remedy
accruing upon any Event of Default shall impair any such right or remedy or
constitute a waiver of any such Event of Default or an acquiescence therein.
Every right and remedy given by this Article V or by law to the Indenture
Trustee or to the Noteholders may be exercised from time to time, and as often
as may be deemed expedient, by the Indenture Trustee or by the Noteholders, as
the case may be.
Section 5.11 CONTROL BY NOTEHOLDERS. The Holders of a majority of the
aggregate Note Principal Balances of Notes shall have the right to direct the
time, method and place of conducting any Proceeding for any remedy available to
the Indenture Trustee with respect to the Notes or exercising any trust or power
conferred on the Indenture Trustee; provided that:
(i) such direction shall not be in conflict with any
rule of law or with this Indenture;
(ii) any direction to the Indenture Trustee to sell
or liquidate the Trust Estate shall be by Holders of Notes representing
not less than 100% of the Note Principal Balances of the Notes; and
(iii) the Indenture Trustee may take any other action
deemed proper by the Indenture Trustee that is not inconsistent with
such direction of the Holders of Notes representing a majority of the
Note Principal Balances of the Notes.
Notwithstanding the rights of Noteholders set forth in this Section 5.11 the
Indenture Trustee need not take any action that it determines might involve it
in liability.
Section 5.12 WAIVER OF PAST DEFAULTS. Prior to the declaration of the
acceleration of the maturity of the Notes as provided in Section 5.02 hereof,
the Holders of Notes representing not less than a majority of the aggregate Note
Principal Balance of the Notes may waive any past Event of Default and its
consequences except an Event of Default (a) with respect to payment of principal
of or interest on any of the Notes, or (b) in respect of a covenant or provision
hereof which cannot be modified or amended without the consent of the Holder of
each Note. In the case of any such waiver, the Issuer, the Indenture Trustee and
the Holders of the Notes shall be restored to their
38
former positions and rights hereunder, respectively, but no such waiver shall
extend to any subsequent or other Event of Default or impair any right
consequent thereto.
Upon any such waiver, any Event of Default arising therefrom shall be
deemed to have been cured and not to have occurred for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other Event of
Default or impair any right consequent thereto.
Section 5.13 UNDERTAKING FOR COSTS. All parties to this Indenture
agree, and each Holder of any Note and each Beneficial Owner of any interest
therein by such Xxxxxx's or Beneficial Owner's acceptance thereof shall be
deemed to have agreed, that any court may in its discretion require, in any suit
for the enforcement of any right or remedy under this Indenture, or in any suit
against the Indenture Trustee for any action taken, suffered or omitted by it as
Indenture Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section 5.13 shall not apply to (a) any suit instituted by
the Indenture Trustee, (b) any suit instituted by any Noteholder, or group of
Noteholders, in each case holding in the aggregate more than 10% of the Note
Principal Balances of the Notes or (c) any suit instituted by any Noteholder for
the enforcement of the payment of principal of or interest on any Note on or
after the respective due dates expressed in such Note and in this Indenture.
Section 5.14 WAIVER OF STAY OR EXTENSION LAWS. The Issuer covenants (to
the extent that it may lawfully do so) that it will not at any time insist upon,
or plead or in any manner whatsoever, claim or take the benefit or advantage of,
any stay or extension law wherever enacted, now or at any time hereafter in
force, that may affect the covenants or the performance of this Indenture; and
the Issuer (to the extent that it may lawfully do so) hereby expressly waives
all benefit or advantage of any such law, and covenants that it shall not
hinder, delay or impede the execution of any power herein granted to the
Indenture Trustee, but will suffer and permit the execution of every such power
as though no such law had been enacted.
Section 5.15 SALE OF TRUST ESTATE. (a) The power to effect any sale or
other disposition (a "Sale") of any portion of the Trust Estate pursuant to
Section 5.04 hereof is expressly subject to the provisions of Section 5.05
hereof and this Section 5.15. The power to effect any such Sale shall not be
exhausted by any one or more Sales as to any portion of the Trust Estate
remaining unsold, but shall continue unimpaired until the entire Trust Estate
shall have been sold or all amounts payable on the Notes and under this
Indenture shall have been paid. The Indenture Trustee, may from time to time
postpone any public Sale by public announcement made at the time and place of
such Sale. The Indenture Trustee hereby expressly waives its right to any amount
fixed by law as compensation for any Sale.
(b) The Indenture Trustee shall not in any private Sale sell the Trust
Estate, or any portion thereof, unless
(1) the Holders of all Notes consent to or direct the
Indenture Trustee to make, such Sale, or
39
(2) the proceeds of such Sale would be not less than the
entire amount which would be payable to the Noteholders under the
Notes, in full payment thereof in accordance with Section 5.02 hereof,
on the Payment Date next succeeding the date of such Sale, or
(3) the Indenture Trustee determines that the conditions for
retention of the Trust Estate set forth in Section 5.05 hereof cannot
be satisfied (in making any such determination, the Indenture Trustee
may rely upon an opinion of an Independent investment banking firm
obtained and delivered as provided in Section 5.05 hereof), the Holders
of Notes representing at least 100% of the Note Principal Balances of
the Notes consent to such Sale.
The purchase by the Indenture Trustee of all or any portion of the Trust Estate
at a private Sale shall not be deemed a Sale or other disposition thereof for
purposes of this Section 5.15(b).
(c) Unless the Holders representing at least 66-2/3% of the Note
Principal Balances of the Notes have otherwise consented or directed the
Indenture Trustee, at any public Sale of all or any portion of the Trust Estate
at which a minimum bid equal to or greater than the amount described in
paragraph (2) of subsection (b) of this Section 5.15 has not been established by
the Indenture Trustee and no Person bids an amount equal to or greater than such
amount, the Indenture Trustee, as trustee for the benefit of the Holders of the
Notes, shall bid an amount at least $1.00 more than the highest other bid.
(d) In connection with a Sale of all or any portion of the Trust
Estate,
(1) any Holder or Holders of Notes may bid for and purchase
the property offered for sale, and upon compliance with the terms of
sale may hold, retain and possess and dispose of such property, without
further accountability, and may, in paying the purchase money therefor,
deliver any Notes or claims for interest thereon in lieu of cash up to
the amount which shall, upon distribution of the net proceeds of such
sale, be payable thereon, and such Notes, in case the amounts so
payable thereon shall be less than the amount due thereon, shall be
returned to the Holders thereof after being appropriately stamped to
show such partial payment;
(2) the Indenture Trustee, may bid for and acquire the
property offered for Sale in connection with any Sale thereof, and,
subject to any requirements of, and to the extent permitted by,
applicable law in connection therewith, may purchase all or any portion
of the Trust Estate in a private sale, and, in lieu of paying cash
therefor, may make settlement for the purchase price by crediting the
gross Sale price against the sum of (A) the amount which would be
distributable to the Holders of the Notes and Holders of Certificates
on the Payment Date next succeeding the date of such Sale and (B) the
expenses of the Sale and of any Proceedings in connection therewith
which are reimbursable to it, without being required to produce the
Notes in order to complete any such Sale or in order for the net Sale
price to be credited against such Notes, and any property so acquired
by the Indenture Trustee shall be held and dealt with by it in
accordance with the provisions of this Indenture;
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(3) the Indenture Trustee shall execute and deliver an
appropriate instrument of conveyance, prepared by the Issuer and
satisfactory to the Indenture Trustee, transferring its interest in any
portion of the Trust Estate in connection with a Sale thereof;
(4) the Indenture Trustee is hereby irrevocably appointed the
agent and attorney- in-fact of the Issuer to transfer and convey its
interest in any portion of the Trust Estate in connection with a Sale
thereof, and to take all action necessary to effect such Sale; and
(5) no purchaser or transferee at such a Sale shall be bound
to ascertain the Indenture Trustee's authority, inquire into the
satisfaction of any conditions precedent or see to the application of
any monies.
Section 5.16 ACTION ON NOTES. The Indenture Trustee's right to seek and
recover judgment on the Notes or under this Indenture shall not be affected by
the seeking, obtaining or application of any other relief under or with respect
to this Indenture. Neither the lien of this Indenture nor any rights or remedies
of the Indenture Trustee or the Noteholders shall be impaired by the recovery of
any judgment by the Indenture Trustee against the Issuer or by the levy of any
execution under such judgment upon any portion of the Trust Estate or upon any
of the assets of the Issuer. Any money or property collected by the Indenture
Trustee shall be applied in accordance with Section 5.04(b) hereof.
Section 5.17 PERFORMANCE AND ENFORCEMENT OF CERTAIN OBLIGATIONS. (a)
Promptly following a request from the Indenture Trustee to do so, the Issuer in
its capacity as holder of the Mortgage Loans, shall take all such lawful action
as the Indenture Trustee may request to cause the Issuer to compel or secure the
performance and observance by the Seller and the Master Servicer, as applicable,
of each of their obligations to the Issuer under or in connection with the
Mortgage Loan Purchase Agreement and the Servicing Agreement, and to exercise
any and all rights, remedies, powers and privileges lawfully available to the
Issuer under or in connection with the Mortgage Loan Purchase Agreement and the
Servicing Agreement to the extent and in the manner directed by the Indenture
Trustee, as pledgee of the Mortgage Loans, including the transmission of notices
of default on the part of the Seller or the Master Servicer thereunder and the
institution of legal or administrative actions or proceedings to compel or
secure performance by the Seller or the Master Servicer of each of their
obligations under the Mortgage Loan Purchase Agreement and the Servicing
Agreement.
(b) The Indenture Trustee, as pledgee of the Mortgage Loans, may, and
at the direction (which direction shall be in writing or by telephone (confirmed
in writing promptly thereafter)) of the Holders of 66-2/3% of the Note Principal
Balances of the Notes, shall exercise all rights, remedies, powers, privileges
and claims of the Issuer against the Seller or the Master Servicer under or in
connection with the Mortgage Loan Purchase Agreement and the Servicing
Agreement, including the right or power to take any action to compel or secure
performance or observance by the Seller or the Master Servicer, as the case may
be, of each of their obligations to the Issuer thereunder and to give any
consent, request, notice, direction, approval, extension or waiver under the
Mortgage Loan Purchase Agreement and the Servicing Agreement, as the case may
be, and any right of the Issuer to take such action shall not be suspended.
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ARTICLE VI
The Indenture Trustee
Section 6.01 DUTIES OF INDENTURE TRUSTEE. (a) If an Event of Default
has occurred and is continuing, the Indenture Trustee shall exercise the rights
and powers vested in it by this Indenture and use the same degree of care and
skill in their exercise as a prudent person would exercise or use under the
circumstances in the conduct of such person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) the Indenture Trustee undertakes to perform such
duties and only such duties as are specifically set forth in this
Indenture and no implied covenants or obligations shall be read into
this Indenture against the Indenture Trustee; and
(ii) in the absence of bad faith on its part, the
Indenture Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon
certificates, reports, documents, Issuer Requests or other instruments
or opinions furnished to the Indenture Trustee and conforming to the
requirements of this Indenture; however, the Indenture Trustee shall
examine the certificates, reports, documents, Issuer Requests or other
instruments and opinions to determine whether or not they conform to
the requirements of this Indenture.
(c) The Indenture Trustee may not be relieved from liability for its
own negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of
paragraph (b) of this Section 6.01;
(ii) the Indenture Trustee shall not be liable for
any error of judgment made in good faith by a Responsible Officer
unless it is proved that the Indenture Trustee was negligent in
ascertaining the pertinent facts; and
(iii) the Indenture Trustee shall not be liable with
respect to any action it takes or omits to take in good faith in
accordance with a direction received by it from Noteholders, the
Certificateholders or from the Issuer, which they are entitled to give
under the Basic Documents.
(d) The Indenture Trustee shall not be liable for interest on any money
received by it except as the Indenture Trustee may agree in writing with the
Issuer.
(e) Money held in trust by the Indenture Trustee need not be segregated
from other trust funds except to the extent required by law or the terms of this
Indenture or the Trust Agreement.
(f) No provision of this Indenture shall require the Indenture Trustee
to expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder
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or in the exercise of any of its rights or powers, if it shall have reasonable
grounds to believe that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it.
(g) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Indenture Trustee
shall be subject to the provisions of this Section and to the provisions of the
TIA.
(h) The Indenture Trustee shall act in accordance with Sections 6.03
and 6.04 of the Servicing Agreement and shall act as successor to the Master
Servicer or appoint a successor Master Servicer in accordance with Section 6.02
of the Servicing Agreement; in no event however, shall the Indenture Trustee
have any liability for any act or omission of the Master Servicer, any
Subservicer, the Owner Trustee or the Custodian.
(i) The Indenture Trustee shall not be deemed to have notice or
knowledge of any Default or Event of Default or any Servicer Default unless a
Responsible Officer of the Indenture Trustee has actual knowledge thereof or
unless written notice of any such event that is in fact an Event of Default,
Default or Servicer Default is received by the Indenture Trustee at its
Corporate Trust Office and such notice references the Notes or Certificates
generally, the Issuer, the Trust Estate or this Indenture.
Section 6.02 RIGHTS OF INDENTURE TRUSTEE. (a) The Indenture Trustee may
rely on any document believed by it to be genuine and to have been signed or
presented by the proper person. The Indenture Trustee need not investigate any
fact or matter stated in the document.
(b) Before the Indenture Trustee acts or refrains from acting, it may
require an Officer's Certificate or an Opinion of Counsel. The Indenture Trustee
shall not be liable for any action it takes or omits to take in good faith in
reliance on an Officer's Certificate or Opinion of Counsel.
(c) The Indenture Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or a custodian or nominee.
(d) The Indenture Trustee shall not be liable for any action it takes
or omits to take in good faith which it believes to be authorized or within its
rights or powers.
(e) The Indenture Trustee may consult with counsel, and the written
advice or Opinion of Counsel with respect to legal matters relating to this
Indenture and the Notes shall be full and complete authorization and protection
from liability in respect to any action taken, omitted or suffered by it
hereunder in good faith and in accordance with the written advice or Opinion of
such counsel.
(f) For the limited purpose of effecting any action to be undertaken by
the Indenture Trustee, but not specifically as a duty of the Indenture Trustee
in the Indenture, the Indenture Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder, either directly or by or through
agents, attorneys, custodians or nominees appointed with due care, and shall not
be
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responsible for any willful misconduct or negligence on the part of any agent,
attorney, custodian or nominee so appointed.
(g) The Indenture Trustee or its Affiliates are permitted to receive
additional compensation that could be deemed to be in the Indenture Trustee's
economic self-interest for (i) serving as investment adviser, administrator,
shareholder servicing agent, custodian or sub-custodian with respect to certain
of the Eligible Investments, (ii) using Affiliates to effect transactions in
certain Eligible Investments and (iii) effecting transactions in certain
Xxxxxxxx Investments. Such compensation shall not be considered an amount that
is reimbursable or payable to the Indenture Trustee (i) as part of the Indenture
Trustee Fee, (ii) pursuant to Sections 5.04(b), 6.07 or 8.02(c) hereunder or
(iii) out of Available Funds.
Section 6.03 INDIVIDUAL RIGHTS OF INDENTURE TRUSTEE. The Indenture
Trustee in its individual or any other capacity may become the owner or pledgee
of Notes and may otherwise deal with the Issuer or its Affiliates with the same
rights it would have if it were not Indenture Trustee, subject to the
requirements of the Trust Indenture Act. Any Note Registrar, co-registrar or
co-paying agent may do the same with like rights. However, the Indenture Trustee
must comply with Sections 6.11 and 6.12 hereof.
Section 6.04 INDENTURE TRUSTEE'S DISCLAIMER. The Indenture Trustee
shall not be responsible for and makes no representation as to the validity or
adequacy of this Indenture, the Notes or any other Basic Document, it shall not
be accountable for the Issuer's use of the proceeds from the Notes, and it shall
not be responsible for any statement of the Issuer in the Indenture or in any
document issued in connection with the sale of the Notes or in the Notes other
than the Indenture Trustee's certificate of authentication.
Section 6.05 NOTICE OF EVENT OF DEFAULT. Subject to Section 5.01, the
Indenture Trustee shall promptly mail to each Noteholder notice of the Event of
Default after it is known to a Responsible Officer of the Indenture Trustee,
unless such Event of Default shall have been waived or cured. Except in the case
of an Event of Default in payment of principal of or interest on any Note, the
Indenture Trustee may withhold the notice if and so long as a committee of its
Responsible Officers in good faith determines that withholding the notice is in
the interests of Noteholders.
Section 6.06 REPORTS BY INDENTURE TRUSTEE TO HOLDERS AND TAX
ADMINISTRATION. The Indenture Trustee shall deliver to each Noteholder such
information as may be required to enable such holder to prepare its federal and
state income tax returns.
The Indenture Trustee shall prepare and file (or cause to be prepared
and filed), on behalf of the Owner Trustee, all tax returns (if any) and
information reports, tax elections and such annual or other reports of the
Issuer as are necessary for preparation of tax returns and information reports
as provided in Section 5.03 of the Trust Agreement, including without limitation
Form 1099. All tax returns and information reports shall be signed by the Owner
Trustee as provided in Section 5.03 of the Trust Agreement.
Section 6.07 COMPENSATION AND INDEMNITY. The Issuer shall pay to the
Indenture Trustee on each Payment Date reasonable compensation for its services.
On each Payment Date the Indenture
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Trustee shall be entitled to withdraw from the Payment Account, the Indenture
Trustee Fee for such Payment Date in accordance with Section 3.07 of the
Servicing Agreement. The Indenture Trustee's compensation shall not be limited
by any law on compensation of a trustee of an express trust. The Issuer shall
reimburse the Indenture Trustee for all reasonable out-of-pocket expenses
incurred or made by it, including costs of collection, in addition to
compensation for its services. Such expenses shall include reasonable
compensation and expenses, disbursements and advances of the Indenture Trustee's
agents, counsel, accountants and experts. The Issuer shall indemnify the
Indenture Trustee against any and all loss, liability or expense (including
attorneys' fees) incurred by it in connection with the administration of this
Trust and the performance of its duties hereunder and under the other Basic
Documents. The Indenture Trustee shall notify the Issuer promptly of any claim
for which it may seek indemnity. Failure by the Indenture Trustee to so notify
the Issuer shall not relieve the Issuer of its obligations hereunder. The Issuer
shall defend any such claim, and the Indenture Trustee may have separate counsel
and the Issuer shall pay the fees and expenses of such counsel. The Issuer is
not obligated to reimburse any expense or indemnify against any loss, liability
or expense incurred by the Indenture Trustee through the Indenture Trustee's own
willful misconduct, negligence or bad faith.
The Issuer's payment obligations to the Indenture Trustee pursuant to
this Section 6.07 shall survive the discharge of this Indenture and the
termination or resignation of the Indenture Trustee. When the Indenture Trustee
incurs expenses after the occurrence of an Event of Default with respect to the
Issuer, the expenses are intended to constitute expenses of administration under
Title 11 of the United States Code or any other applicable federal or state
bankruptcy, insolvency or similar law.
Section 6.08 REPLACEMENT OF INDENTURE TRUSTEE. No resignation or
removal of the Indenture Trustee and no appointment of a successor Indenture
Trustee shall become effective until the acceptance of appointment by the
successor Indenture Trustee pursuant to this Section 6.08. The Indenture Trustee
may resign at any time by so notifying the Issuer. Holders of a majority of Note
Principal Balances of the Notes may remove the Indenture Trustee by so notifying
the Indenture Trustee and may appoint a successor Indenture Trustee. The Issuer
shall, remove the Indenture Trustee if:
(i) the Indenture Trustee fails to comply with
Section 6.11 hereof;
(ii) the Indenture Trustee is adjudged a bankrupt or
insolvent;
(iii) a receiver or other public officer takes charge
of the Indenture Trustee or its property; or
(iv) the Indenture Trustee otherwise becomes
incapable of acting.
If the Indenture Trustee resigns or is removed or if a vacancy exists
in the office of the Indenture Trustee for any reason (the Indenture Trustee in
such event being referred to herein as the retiring Indenture Trustee), the
Issuer shall, promptly appoint a successor Indenture Trustee.
A successor Indenture Trustee shall deliver a written acceptance of its
appointment to the retiring Indenture Trustee and to the Issuer. Thereupon, the
resignation or removal of the retiring
45
Indenture Trustee shall become effective, and the successor Indenture Trustee
shall have all the rights, powers and duties of the Indenture Trustee under this
Indenture. The successor Indenture Trustee shall mail a notice of its succession
to Noteholders. The retiring Indenture Trustee shall promptly transfer all
property held by it as Indenture Trustee to the successor Indenture Trustee.
If a successor Indenture Trustee does not take office within 60 days
after the retiring Indenture Trustee resigns or is removed, the retiring
Indenture Trustee, the Issuer or the Holders of a majority of Note Principal
Balances of the Notes may petition any court of competent jurisdiction for the
appointment of a successor Indenture Trustee.
Notwithstanding the replacement of the Indenture Trustee pursuant to
this Section, the Issuer's obligations under Section 6.07 shall continue for the
benefit of the retiring Indenture Trustee.
Section 6.09 SUCCESSOR INDENTURE TRUSTEE BY MERGER. If the Indenture
Trustee consolidates with, merges or converts into, or transfers all or
substantially all of its corporate trust business or assets to, another
corporation or banking association, the resulting, surviving or transferee
corporation, without any further act, shall be the successor Indenture Trustee;
provided, that such corporation or banking association shall be otherwise
qualified and eligible under Section 6.11 hereof. The Indenture Trustee shall
provide the Rating Agencies with prior written notice of any such transaction.
If at the time such successor or successors by merger, conversion or
consolidation to the Indenture Trustee shall succeed to the trusts created by
this Indenture and any of the Notes shall have been authenticated but not
delivered, any such successor to the Indenture Trustee may adopt the certificate
of authentication of any predecessor trustee and deliver such Notes so
authenticated; and if at that time any of the Notes shall not have been
authenticated, any successor to the Indenture Trustee may authenticate such
Notes either in the name of any predecessor hereunder or in the name of the
successor to the Indenture Trustee; and in all such cases such certificates
shall have the full force which it is in the Notes or in this Indenture provided
that the certificate of the Indenture Trustee shall have.
Section 6.10 APPOINTMENT OF CO-INDENTURE TRUSTEE OR SEPARATE INDENTURE
TRUSTEE. (a) Notwithstanding any other provisions of this Indenture, at any
time, for the purpose of meeting any legal requirement of any jurisdiction in
which any part of the Trust Estate may at the time be located, the Indenture
Trustee shall have the power and may execute and deliver all instruments to
appoint one or more Persons to act as a co-trustee or co-trustees, or separate
trustee or separate trustees, of all or any part of the Trust Estate, and to
vest in such Person or Persons, in such capacity and for the benefit of the
Noteholders, such title to the Trust Estate, or any part hereof, and, subject to
the other provisions of this Section, such powers, duties, obligations, rights
and trusts as the Indenture 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 6.11 hereof.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
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(i) all rights, powers, duties and obligations
conferred or imposed upon the Indenture Trustee shall be conferred or
imposed upon and exercised or performed by the Indenture Trustee and
such separate trustee or co-trustee jointly (it being understood that
such separate trustee or co-trustee is not authorized to act separately
without the Indenture Trustee joining in such act), except to the
extent that under any law of any jurisdiction in which any particular
act or acts are to be performed the Indenture Trustee shall be
incompetent or unqualified to perform such act or acts, in which event
such rights, powers, duties and obligations (including the holding of
title to the Trust Estate or any portion thereof in any such
jurisdiction) shall be exercised and performed singly by such separate
trustee or co-trustee, but solely at the direction of the Indenture
Trustee;
(ii) no trustee hereunder shall be personally liable
by reason of any act or omission of any other trustee hereunder; and
(iii) the Indenture Trustee may at any time accept
the resignation of or remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the Indenture 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 Indenture and
the conditions of this Article VI. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Indenture Trustee or separately, as may be provided therein, subject to all the
provisions of this Indenture, specifically including every provision of this
Indenture relating to the conduct of, affecting the liability of, or affording
protection to, the Indenture Trustee. Every such instrument shall be filed with
the Indenture Trustee.
(d) Any separate trustee or co-trustee may at any time constitute the
Indenture 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 Indenture 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 Indenture Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
Section 6.11 ELIGIBILITY; DISQUALIFICATION. The Indenture Trustee shall
at all times satisfy the requirements of TIA ss. 310(a). The Indenture Trustee
shall have a combined capital and surplus of at least $50,000,000 as set forth
in its most recent published annual report of condition and it or its parent
shall have a long-term debt rating of Baa3 or better by Xxxxx'x and BBB or
better by Standard & Poor's. The Indenture Trustee shall comply with TIA ss.
310(b), including the optional provision permitted by the second sentence of TIA
ss. 310(b)(9); PROVIDED, HOWEVER, that there shall be excluded from the
operation of TIA ss. 310(b)(1) any indenture or indentures under which other
securities of the Issuer are outstanding if the requirements for such exclusion
set forth in TIA ss. 310(b)(1) are met.
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Section 6.12 PREFERENTIAL COLLECTION OF CLAIMS AGAINST ISSUER. The
Indenture Trustee shall comply with TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). An Indenture Trustee who has resigned or
been removed shall be subject to TIA ss. 311(a) to the extent indicated.
Section 6.13 REPRESENTATIONS AND WARRANTIES. The Indenture Trustee
hereby represents that:
(i) The Indenture Trustee is duly organized and
validly existing as a national banking association in good standing
under the laws of the United States with power and authority to own its
properties and to conduct its business as such properties are currently
owned and such business is presently conducted;
(ii) The Indenture Trustee has the power and
authority to execute and deliver this Indenture and to carry out its
terms; and the execution, delivery and performance of this Indenture
have been duly authorized by the Indenture Trustee by all necessary
corporate action;
(iii) The consummation of the transactions
contemplated by this Indenture and the fulfillment of the terms hereof
do not conflict with, result in any breach of any of the terms and
provisions of, or constitute (with or without notice or lapse of time)
a default under, the articles of incorporation or bylaws of the
Indenture Trustee or any agreement or other instrument to which the
Indenture Trustee is a party or by which it is bound; and
(iv) To the Indenture Trustee's knowledge, there are
no proceedings or investigations pending or threatened before any
court, regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Indenture Trustee or its
properties: (A) asserting the invalidity of this Indenture (B) seeking
to prevent the consummation of any of the transactions contemplated by
this Indenture or (C) seeking any determination or ruling that might
materially and adversely affect the performance by the Indenture
Trustee of its obligations under, or the validity or enforceability of,
this Indenture.
Section 6.14 DIRECTIONS TO INDENTURE TRUSTEE. The Indenture Trustee is
hereby directed:
(a) to accept the pledge of the Mortgage Loans and hold the assets of
the Trust Estate in trust for the Noteholders;
(b) to authenticate and deliver the Notes substantially in the form
prescribed by Exhibits A-1 and A-2 to this Indenture in accordance with the
terms of this Indenture; and
(c) to take all other actions as shall be required to be taken by the
terms of this Indenture.
Section 6.15 THE AGENTS. The provisions of this Indenture relating to
the limitations of the Indenture Trustee's liability and to its indemnity,
rights and protections shall inure also to the Paying Agent and Note Registrar.
Section 6.16 ADMINISTRATIVE DUTIES.
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(a) The Indenture Trustee agrees to perform all of the duties of the
Issuer under the Depository Agreement. In addition to its duties performed under
the Depository Agreement, the Indenture Trustee shall take all appropriate
action that is the duty of the Issuer to take with respect to the following
matters under the Trust Agreement, the Mortgage Loan Purchase Agreement and the
Indenture (references are to sections of the Indenture):
(i) The Indenture Trustee shall notify the Owner Trustee if
the Indenture Trustee obtains actual knowledge or written notice that
any withholding tax is imposed on the Trust's payments (or allocations
of income) to a Certificateholder;
(ii) the duty to cause the Note Register to be kept if the
Issuer assumes the duties of Note Registrar, and to give the Indenture
Trustee notice of any appointment of a new Note Registrar and the
location, or change in location, of the Note Register (Section 4.02);
(iii) causing the preparation of the Notes for execution by
the Owner Trustee upon the registration of any transfer or exchange of
the Notes (Sections 4.02 and 4.03);
(iv) if requested, causing the preparation of an Issuer Order
and related documents for authentication of the Notes, executing such
Issuer Order on behalf of the Issuer and causing delivery of the same
to the Indenture Trustee (Sections 4.02, 4.03 and 4.08);
(v) causing the preparation of Definitive Notes in accordance
with the instructions of any Clearing Agency (including the preparation
of any temporary notes) (Section 4.14);
(vi) the maintenance of an office for registration of transfer
or exchange of Notes (Section 3.02);
(vii) the preparation of an Issuer Order required to appoint a
Paying Agent, the preparation of written notice to the Indenture
Trustee and the duty to cause newly appointed Paying Agents, if any, to
execute and deliver to the Indenture Trustee the instrument specified
in the Indenture regarding funds held in trust (Section 3.03);
(viii) notifying the Paying Agent to pay to the Indenture
Trustee all sums held in trust by the Paying Agent (Section 3.03);
(ix) the execution of all supplements, amendments, financing
statements, continuation statements, instruments of further assurance
and other instruments necessary to protect the Collateral prepared by
the Issuer and delivered to the Indenture Trustee for execution
(Section 3.06);
(x) the notification to the Owner Trustee of the Issuer's
non-compliance with its negative covenants or restricted payment
covenants upon actual knowledge by the Indenture Trustee of such
non-compliance (Sections 3.09 and 3.23);
49
(xi) the furnishing of the Indenture Trustee with the names
and addresses of Holders of Notes during any period when the Indenture
Trustee is not the Note Registrar (Section 7.01); and
(xii) if necessary, the mailing to the Noteholders of notices
with respect to their consent to any supplemental indentures (Section
9.02).
(b) The Indenture Trustee agrees to notify the Depositor not later than
thirty (30) days prior to the date on which the Issuer is required to deliver
the annual Opinion of Counsel in accordance with Section 3.07(b) of this
Indenture.
(c) In carrying out the foregoing duties or any of its other
obligations under this Indenture, the Indenture Trustee may enter into
transactions with or otherwise deal with any of its Affiliates; provided,
however, that the terms of any such transactions or dealings shall be in
accordance with any directions received from the Issuer and shall be, in the
Indenture Trustee's opinion, no less favorable to the Issuer than would be
available from unaffiliated parties.
(d) The Indenture Trustee in its capacity as the Certificate Registrar,
and upon a request received from the Owner Trustee, shall promptly notify the
Certificateholders of (i) any change in the Corporate Trust Office of the Owner
Trustee, (ii) any amendment to the Trust Agreement requiring notice be given to
the Certificateholders and (iii) any other notice required to be given to the
Certificateholders by the Owner Trustee under the Trust Agreement.
(e) With respect to matters that in the reasonable judgment of the
Indenture Trustee are non-ministerial, the Indenture Trustee shall not take any
action pursuant to this Article VIII unless within a reasonable time before the
taking of such action, the Indenture Trustee shall have notified the Owner
Trustee and the Rating Agency of the proposed action and the Rating Agency shall
have notified the Issuer that such transaction shall not cause the rating of the
Notes, to be reduced, suspended or withdrawn and the Owner Trustee shall not
have withheld consent or provided an alternative direction. For the purpose of
the preceding sentence, "non-ministerial matters" shall include:
(i) the amendment of or any supplement to the Indenture;
(ii) the initiation of any claim or lawsuit by the Issuer and
the compromise of any action, claim or lawsuit brought by or against
the Issuer (other than in connection with the collection of the
Mortgage Loans);
(iii) the amendment, change or modification of this Indenture
or any of the other Basic Documents;
(iv) the appointment of successor Certificate Paying Agents
and successor Indenture Trustees pursuant to the Indenture or the
appointment of successor Master Servicers or the consent to the
assignment by the Certificate Registrar, Paying Agent or Indenture
Trustee of its obligations under the Indenture; and
(v) the removal of the Indenture Trustee.
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Section 6.17 RECORDS. The Indenture Trustee shall maintain appropriate
books of account and records relating to services performed under this
Indenture, which books of account and records shall be accessible for inspection
by the Issuer at any time during normal business hours.
Section 6.18 ADDITIONAL INFORMATION TO BE FURNISHED. The Indenture
Trustee shall furnish to the Issuer from time to time such additional
information regarding the Mortgage Loans and the Notes as the Issuer shall
reasonably request.
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ARTICLE VII
Noteholders' Lists and Reports
Section 7.01 ISSUER TO FURNISH INDENTURE TRUSTEE NAMES AND ADDRESSES OF
NOTEHOLDERS. The Issuer will furnish or cause to be furnished to the Indenture
Trustee (a) not more than five days after each Record Date, a list, in such form
as the Indenture Trustee may reasonably require, of the names and addresses of
the Holders of Notes as of such Record Date, (b) at such other times as the
Indenture Trustee may request in writing, within 30 days after receipt by the
Issuer of any such request, a list of similar form and content as of a date not
more than 10 days prior to the time such list is furnished; PROVIDED, HOWEVER,
that so long as the Indenture Trustee is the Note Registrar, no such list shall
be required to be furnished to the Indenture Trustee.
Section 7.02 PRESERVATION OF INFORMATION; COMMUNICATIONS TO
NOTEHOLDERS. (a) The Indenture Trustee shall preserve, in as current a form as
is reasonably practicable, the names and addresses of the Holders of Notes
contained in the most recent list furnished to the Indenture Trustee as provided
in Section 7.01 hereof and the names and addresses of Holders of Notes received
by the Indenture Trustee in its capacity as Note Registrar. The Indenture
Trustee may destroy any list furnished to it as provided in such Section 7.01
upon receipt of a new list so furnished.
(b) Noteholders may communicate pursuant to TIA ss. 312(b) with other
Noteholders with respect to their rights under this Indenture or under the
Notes.
(c) The Issuer, the Indenture Trustee and the Note Registrar shall have
the protection of TIA ss. 312(c).
Section 7.03 REPORTS OF ISSUER. (a) Subject to Section 4.06 of the
Servicing Agreement,
(i) the Indenture Trustee shall file with the
Commission on behalf of the Issuer, with a copy to the Issuer within 15
days before the Issuer is required to file the same with the
Commission, the annual reports and the information, documents and other
reports (or such portions of any of the foregoing as the Commission may
from time to time by rules and regulations prescribe) that the Issuer
may be required to file with the Commission pursuant to Section 13 or
15(d) of the Exchange Act;
(ii) The Indenture Trustee shall file with the
Commission, on behalf of the Issuer, in accordance with rules and
regulations prescribed from time to time by the Commission such
additional information, documents and reports with respect to
compliance by the Issuer with the conditions and covenants of this
Indenture as may be required from time to time by such rules and
regulations; and
(iii) The Indenture Trustee shall supply (and the
Indenture Trustee shall transmit by mail to all Noteholders described
in TIA ss. 313(c)) such summaries of any information, documents and
reports required to be filed by the Issuer pursuant to clauses (i) and
(ii) of this Section 7.03(a) and by rules and regulations prescribed
from time to time by the Commission.
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(b) Unless the Issuer otherwise determines, the fiscal year of the
Issuer shall end on December 31 of each year.
Section 7.04 REPORTS BY INDENTURE TRUSTEE. If required by TIA ss.
313(a), within 60 days after each January 30 beginning with March 31, 2005, the
Indenture Trustee shall mail to each Noteholder as required by TIA ss. 313(c) a
brief report dated as of such date that complies with TIA ss. 313(a). The
Indenture Trustee also shall comply with TIA ss. 313(b).
A copy of each report at the time of its mailing to Noteholders shall
be filed by the Indenture Trustee with the Commission via XXXXX and each stock
exchange, if any, on which the Notes are listed. The Issuer shall notify the
Indenture Trustee if and when the Notes are listed on any stock exchange.
Section 7.05 STATEMENTS TO NOTEHOLDERS. (a) With respect to each
Payment Date, the Indenture Trustee shall make available via the Indenture
Trustee's website, initially located at xxx.xxxxxxx.xxx, to each Noteholder and
each Certificateholder, the Depositor, the Owner Trustee, the Certificate Paying
Agent and each Rating Agency, a statement setting forth the following
information as to the Notes, to the extent applicable:
(i) the aggregate amount of collections with respect
to the Mortgage Loans;
(ii) the Group I Available Funds, Group II Available
Funds, Group III Available Funds, Group IV Available Funds and Net
Monthly Excess Cash Flow, with respect to the Group I, Group II, Group
III and Group IV Loans, payable to each Class of Noteholders for such
Payment Date, the Basis Risk Shortfall Carry-Forward Amount and Net WAC
Shortfall Carry-Forward Amount on each Class of Notes for such Payment
Date and the aggregate Unpaid Interest Shortfall on each Class of Notes
for such Payment Date;
(iii) (a) the amount of such distribution to each
Class of Class I-A, Class I-M-1, Class I-M-2, Class I-M-3, Class II-A,
Class II-M-1, Class II-M-2, Class II-M-3, Class III-A, Class III-M-1,
Class III-M-2, Class IV-A, Class IV-M-1, Class IV-M-2 and Class IV- M-3
Notes applied to reduce the Note Principal Balance thereof, and (b) the
aggregate amount included therein representing Principal Prepayments;
(iv) the amount of such distribution to Holders of
each Class of Notes allocable to interest;
(v) the amount of any distribution to the
Certificates;
(vi) if the distribution to the Holders of any Class
of Notes is less than the full amount that would be distributable to
such Holders if there were sufficient funds available therefor, the
amount of the shortfall;
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(vii) the number and the aggregate Stated Principal
Balance of the Mortgage Loans as of the end of the related Due Period,
determined in the aggregate and separately for Loan Group I, Loan Group
II, Loan Group III and Loan Group IV;
(viii) the aggregate Note Principal Balance of each
Class of Notes, after giving effect to the amounts distributed on such
Payment Date, separately identifying any reduction thereof due to
Realized Losses and the aggregate Note Principal Balance of all of the
Class I-A, Class I-M-1, Class I-M-2, Class I-M-3, Class II-A, Class
II-M-1, Class II-M-2, Class II-M-3, Class III-A, Class III-M-1, Class
III-M-2, Class IV-A, Class IV-M-1, Class IV- M-2 and Class IV-M-3 Notes
after giving effect to the distribution of principal on such Payment
Date;
(ix) the number and aggregate Stated Principal
Balances of Mortgage Loans (a) as to which the Monthly Payment is
delinquent for 31-60 days, 61-90 days, 91 or more days, respectively,
(b) in foreclosure and (c) that have become REO Property, in each case
as of the end of the preceding calendar month, determined in the
aggregate and separately for Loan Group I, Loan Group II, Loan Group
III and Loan Group IV;
(x) the Overcollateralization Increase Amount with
respect to each Loan Group, Overcollateralization Target Amount and
Overcollateralized Amount, if any, in each case as the end of the
related Payment Date, in each case as determined separately for each
Loan Group;
(xi) the amount of any Advances and Compensating
Interest payments;
(xii) the aggregate Realized Losses with respect to
the related Payment Date and cumulative Realized Losses since the
Closing Date;
(xiii) the number and aggregate Stated Principal
Balance of Mortgage Loans repurchased pursuant to the Mortgage Loan
Purchase Agreement for the related Payment Date and cumulatively since
the Closing Date determined in the aggregate and separately for Loan
Group I, Loan Group II, Loan Group III and Loan Group IV;
(xiv) the book value of any REO Property;
(xv) the amount of any Prepayment Interest Shortfalls
or Relief Act Shortfalls for such Payment Date; and
(xvi) the aggregate Stated Principal Balance of
Mortgage Loans purchased pursuant to Section 3.18 of the Servicing
Agreement for the related Payment Date and cumulatively since the
Closing Date.
Items (iii) and (iv) above shall be presented on the basis of a Note
having a $1,000 denomination. In addition, by January 31 of each calendar year
following any year during which the Notes are outstanding, the Indenture Trustee
shall furnish a report to each Noteholder of record if
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so requested in writing at any time during each calendar year as to the
aggregate of amounts reported pursuant to (iii) and (iv) with respect to the
Notes for such calendar year.
The Indenture Trustee may conclusively rely upon the Remittance Report
provided by the Master Servicer to the Indenture Trustee pursuant to Section
4.01 of the Servicing Agreement in its preparation of its Statement to
Noteholders.
The Indenture Trustee will make the monthly statements provided for in
this section (and, at its option, any additional files containing the same
information in an alternative format) available each month to Noteholders, other
parties to this Agreement and any other interested parties via the Indenture
Trustee's website. The Indenture Trustee's website shall initially be located at
xxx.xxxxxxx.xxx. Assistance in using the website can be obtained by calling the
Indenture Trustee's customer service desk at (000) 000-0000. Parties that are
unable to use the website are entitled to have a paper copy mailed to them via
first class mail by calling the customer service desk and indicating such. With
the consent of the Depositor, the Indenture Trustee may have the right to change
the way the monthly statements are distributed in order to make such
distribution more convenient and/or more accessible to the above parties and the
Indenture Trustee shall provide timely and adequate notification to all above
parties regarding any such changes.
The Indenture Trustee shall be entitled to rely on but shall not be
responsible for the content or accuracy of any information provided by third
parties for purposes of preparing the monthly statement, and may affix thereto
any disclaimer it deems appropriate in its reasonable discretion (without
suggesting liability on the part of any other party hereto).
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ARTICLE VIII
Accounts, Disbursements and Releases
Section 8.01 COLLECTION OF MONEY. Except as otherwise expressly
provided herein, the Indenture Trustee may demand payment or delivery of, and
shall receive and collect, directly and without intervention or assistance of
any fiscal agent or other intermediary, all money and other property payable to
or receivable by the Indenture Trustee pursuant to this Indenture. The Indenture
Trustee shall apply all such money received by it as provided in this Indenture.
Except as otherwise expressly provided in this Indenture, if any default occurs
in the making of any payment or performance under any agreement or instrument
that is part of the Trust Estate, the Indenture Trustee may take such action as
may be appropriate to enforce such payment or performance, including the
institution and prosecution of appropriate Proceedings. Any such action shall be
without prejudice to any right to claim a Default or Event of Default under this
Indenture and any right to proceed thereafter as provided in Article V.
Section 8.02 TRUST ACCOUNTS. (a) On or prior to the Closing Date, the
Issuer shall cause the Indenture Trustee to establish and maintain, in the name
of the Indenture Trustee, for the benefit of the Noteholders, the Payment
Account as provided in Section 3.01 hereof.
(b) All monies deposited from time to time in the Payment Account and
all deposits therein pursuant to this Indenture (other than deposits of any gain
or income on investments thereof) are for the benefit of the Noteholders. Any
loss on any investment made by the Indenture Trustee with funds in the Payment
Account shall be reimbursed immediately to the Trust Estate by the Indenture
Trustee. All investments made with monies in the Payment Account and the
Certificate Distribution Account including all income or other gain from such
investments shall be for the benefit of and the risk of the Indenture Trustee.
(c) On each Payment Date, the Indenture Trustee shall be entitled to
withdraw from the Payment Account the following amounts: (i) to pay to the
Indenture Trustee the Indenture Trustee Fee with respect to such Payment Date
and all other amounts reimbursable by the Issuer or from the Payment Account to
the Indenture Trustee pursuant to any provision of any Basic Document, (ii) to
pay to the Owner Trustee all amounts payable or reimbursable by the Issuer or
from the Payment Account pursuant to any provision of the Trust Agreement and
(iii) to pay to the Custodian all amounts payable or reimbursable by the Issuer
or from the Payment Account pursuant to any provision of the Custodial
Agreement, and then the Indenture Trustee shall distribute all remaining amounts
on deposit in the Payment Account to the Noteholders in respect of the Notes and
to such other persons in the order of priority set forth in Section 3.05 hereof
(except as otherwise provided in Section 5.04(b) hereof). In addition, the
Indenture Trustee shall pay from its own funds, without any right of
reimbursement therefor from the Issuer or the Payment Account, all Owner Trustee
Fees and the fees payable to the Custodian pursuant to the Custodial Agreement.
(d) The Indenture Trustee shall invest any funds in the Payment
Account, but only in Eligible Investments, as directed by it, maturing no later
than the next Payment Date and such Eligible Investments shall not be sold or
disposed of prior to their maturity.
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Section 8.03 OFFICER'S CERTIFICATE. The Indenture Trustee shall receive
at least seven Business Days' notice when requested by the Issuer to take any
action pursuant to Section 8.05(a) hereof, accompanied by copies of any
instruments to be executed, and the Indenture Trustee shall also require, as a
condition to such action, an Officer's Certificate, in form and substance
satisfactory to the Indenture Trustee, stating the legal effect of any such
action, outlining the steps required to complete the same, and concluding that
all conditions precedent to the taking of such action have been complied with.
Section 8.04 TERMINATION UPON DISTRIBUTION TO NOTEHOLDERS. This
Indenture and the respective obligations and responsibilities of the Issuer and
the Indenture Trustee created hereby shall terminate upon the distribution to
Noteholders, the Certificate Paying Agent on behalf of the Certificateholders
and the Indenture Trustee of all amounts required to be distributed pursuant to
Article III; PROVIDED, HOWEVER, that in no event shall the trust created hereby
continue beyond the expiration of 21 years from the death of the survivor of the
descendants of Xxxxxx X. Xxxxxxx, the late ambassador of the United States to
the Court of St. Xxxxx, living on the date hereof.
Section 8.05 RELEASE OF TRUST ESTATE. (a) Subject to the payment of its
fees and expenses, the Indenture Trustee may, and when required by the
provisions of this Indenture shall, execute instruments to release property from
the lien of this Indenture, or convey the Indenture Trustee's interest in the
same, in a manner and under circumstances that are not inconsistent with the
provisions of this Indenture, including for the purposes of any repurchase by
the Master Servicer of a Mortgage Loan pursuant to Section 3.18 of the Servicing
Agreement. No party relying upon an instrument executed by the Indenture Trustee
as provided in Article VIII hereunder shall be bound to ascertain the Indenture
Trustee's authority, inquire into the satisfaction of any conditions precedent,
or see to the application of any monies.
(b) The Indenture Trustee shall, at such time as (i) there are no Notes
Outstanding, (ii) all sums due to the Indenture Trustee pursuant to this
Indenture have been paid, release any remaining portion of the Trust Estate that
secured the Notes from the lien of this Indenture.
(c) The Indenture Trustee shall release property from the lien of this
Indenture pursuant to this Section 8.05 only upon receipt of a request from the
Issuer accompanied by an Officers' Certificate and an Opinion of Counsel stating
that all applicable requirements have been satisfied.
Section 8.06 SURRENDER OF NOTES UPON FINAL PAYMENT. By acceptance of
any Note, the Holder thereof agrees to surrender such Note to the Indenture
Trustee promptly, prior to such Noteholder's receipt of the final payment
thereon.
Section 8.07 OPTIONAL REDEMPTION OF THE NOTES. (a) The Majority
Certificateholder shall have the option to redeem the Notes, in whole, but not
in part, on any Payment Date on or after the Payment Date on which the aggregate
Stated Principal Balance of the Mortgage Loans as of the end of the prior Due
Period is less than or equal to 10% of the aggregate Stated Principal Balance of
the Mortgage Loans as of Cut-off Date. The aggregate redemption price (the
"Redemption Price") for the Notes, will be equal to the unpaid Note Principal
Balance of the Notes as of the Payment Date on which the proposed redemption
will take place in accordance with the foregoing, together with accrued and
unpaid interest thereon at the applicable Note Interest Rate through such
Payment Date
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(including any related Unpaid Interest Shortfall, Basis Risk Shortfall
Carry-Forward Amount and Net WAC Shortfall Carry-Forward Amount), plus an amount
sufficient to pay in full all amounts owing to the Indenture Trustee under this
Indenture (which amounts shall be specified in writing upon request of the
Issuer by the Indenture Trustee) or under any other Basic Document.
(b) In order to exercise the foregoing option, the Issuer shall provide
written notice of its exercise of such option to the Indenture Trustee, the
Owner Trustee and the Master Servicer at least 15 days prior to its exercise.
Following receipt of the notice, the Indenture Trustee shall provide notice to
the Noteholders of the final payment on the Notes. In addition, the Majority
Certificateholder shall, not less than one Business Day prior to the proposed
Payment Date on which such redemption is to be made, deposit the Redemption
Price specified in (a) above with the Indenture Trustee, who shall deposit the
Redemption Price into the Payment Account and shall, on the Payment Date after
receipt of the funds, apply such funds to make final payments of principal and
interest on the Notes in accordance with Section 3.05(b) and (c) hereof and
payment in full to the Indenture Trustee, and this Indenture shall be discharged
subject to the provisions of Section 4.10 hereof. If for any reason the amount
deposited by the Majority Certificateholder is not sufficient to make such
redemption or such redemption cannot be completed for any reason, (a) the amount
so deposited by the Majority Certificateholder with the Indenture Trustee shall
be immediately returned to the Majority Certificateholder in full and shall not
be used for any other purpose or be deemed to be part of the Trust Estate and
(b) the Note Principal Balance of the Notes shall continue to bear interest at
the related Note Interest Rate.
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ARTICLE IX
Supplemental Indentures
Section 9.01 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF NOTEHOLDERS.
(a) Without the consent of the Holders of any Notes but with prior notice to the
Rating Agencies, the Issuer and the Indenture Trustee, when authorized by an
Issuer Request, at any time and from time to time, may enter into one or more
indentures supplemental hereto (which shall conform to the provisions of the TIA
as in force at the date of the execution thereof), in form satisfactory to the
Indenture Trustee, for any of the following purposes:
(i) to correct or amplify the description of any
property at any time subject to the lien of this Indenture, or better
to assure, convey and confirm unto the Indenture Trustee any property
subject or required to be subjected to the lien of this Indenture, or
to subject to the lien of this Indenture additional property;
(ii) to evidence the succession, in compliance with
the applicable provisions hereof, of another person to the Issuer, and
the assumption by any such successor of the covenants of the Issuer
herein and in the Notes contained;
(iii) to add to the covenants of the Issuer, for the
benefit of the Holders of the Notes, or to surrender any right or power
herein conferred upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge
any property to or with the Indenture Trustee;
(v) to cure any ambiguity, to correct or supplement
any provision herein or in any supplemental indenture that may be
inconsistent with any other provision herein or in any supplemental
indenture;
(vi) to make any other provisions with respect to
matters or questions arising under this Indenture or in any
supplemental indenture; provided, that such action shall not materially
and adversely affect the interests of the Holders of the Notes;
(vii) to evidence and provide for the acceptance of
the appointment hereunder by a successor trustee with respect to the
Notes and to add to or change any of the provisions of this Indenture
as shall be necessary to facilitate the administration of the trusts
hereunder by more than one trustee, pursuant to the requirements of
Article VI hereof; or
(viii) to modify, eliminate or add to the provisions
of this Indenture to such extent as shall be necessary to effect the
qualification of this Indenture under the TIA or under any similar
federal statute hereafter enacted and to add to this Indenture such
other provisions as may be expressly required by the TIA;
PROVIDED, HOWEVER, that no such indenture supplements shall be entered into
unless the Indenture Trustee shall have received an Opinion of Counsel as to the
enforceability of any such indenture
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supplement and to the effect that (i) such indenture supplement is permitted
hereunder and (ii) entering into such indenture supplement will not result in a
"substantial modification" of the Notes under Treasury Regulation Section
1.1001-3 or adversely affect the status of the Notes as indebtedness for federal
income tax purposes.
The Indenture Trustee is hereby authorized to join in the execution of
any such supplemental indenture and to make any further appropriate agreements
and stipulations that may be therein contained.
(b) The Issuer and the Indenture Trustee, when authorized by an Issuer
Request, may, also without the consent of any of the Holders of the Notes and
prior notice to the Rating Agencies, enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to, or changing in
any manner or eliminating any of the provisions of, this Indenture or of
modifying in any manner the rights of the Holders of the Notes under this
Indenture; PROVIDED, HOWEVER, that such action as evidenced by an Opinion of
Counsel, (i) is permitted by this Indenture, and shall not (ii) adversely affect
in any material respect the interests of any Noteholder or (iii) if 100% of the
Certificates are not owned by AHM SPV III, LLC, cause the Issuer to be subject
to an entity level tax for federal income tax purposes.
Section 9.02 SUPPLEMENTAL INDENTURES WITH CONSENT OF NOTEHOLDERS. The
Issuer and the Indenture Trustee, when authorized by an Issuer Request, also
may, with prior notice to the Rating Agencies and, with the consent of the
Holders of not less than a majority of the Note Principal Balance of each Class
of Notes affected thereby, by Act (as defined in Section 10.03 hereof) of such
Holders delivered to the Issuer and the Indenture Trustee, enter into an
indenture or indentures supplemental hereto for the purpose of adding any
provisions to, or changing in any manner or eliminating any of the provisions
of, this Indenture or of modifying in any manner the rights of the Holders of
the Notes under this Indenture; PROVIDED, HOWEVER, that no such supplemental
indenture shall, without the consent of the Holder of each Note affected
thereby:
(i) change the date of payment of any installment of
principal of or interest on any Note, or reduce the principal amount
thereof or the interest rate thereon, change the provisions of this
Indenture relating to the application of collections on, or the
proceeds of the sale of, the Trust Estate to payment of principal of or
interest on the Notes, or change any place of payment where, or the
coin or currency in which, any Note or the interest thereon is payable,
or impair the right to institute suit for the enforcement of the
provisions of this Indenture requiring the application of funds
available therefor, as provided in Article V, to the payment of any
such amount due on the Notes on or after the respective due dates
thereof;
(ii) reduce the percentage of the Note Principal
Balances of the Notes, the consent of the Holders of which is required
for any such supplemental indenture, or the consent of the Holders of
which is required for any waiver of compliance with certain provisions
of this Indenture or certain defaults hereunder and their consequences
provided for in this Indenture;
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(iii) modify or alter the provisions of the proviso
to the definition of the term "Outstanding" or modify or alter the
exception in the definition of the term "Holder";
(iv) reduce the percentage of the Note Principal
Balances of the Notes required to direct the Indenture Trustee to
direct the Issuer to sell or liquidate the Trust Estate pursuant to
Section 5.04 hereof;
(v) modify any provision of this Section 9.02 except
to increase any percentage specified herein or to provide that certain
additional provisions of this Indenture or the Basic Documents cannot
be modified or waived without the consent of the Holder of each Note
affected thereby;
(vi) modify any of the provisions of this Indenture
in such manner as to affect the calculation of the amount of any
payment of interest or principal due on any Note on any Payment Date
(including the calculation of any of the individual components of such
calculation); or
(vii) permit the creation of any lien ranking prior
to or on a parity with the lien of this Indenture with respect to any
part of the Trust Estate or, except as otherwise permitted or
contemplated herein, terminate the lien of this Indenture on any
property at any time subject hereto or deprive the Holder of any Note
of the security provided by the lien of this Indenture;
and PROVIDED, FURTHER, that such action shall not, as evidenced by an Opinion of
Counsel, cause the Issuer (if 100% of the Certificates are not owned by American
Home Mortgage Securities LLC) to be subject to an entity level tax.
Any such action shall not adversely affect in any material respect the
interest of any Holder (other than a Holder who shall consent to such
supplemental indenture) as evidenced by an Opinion of Counsel (provided by the
Person requesting such supplemental indenture) delivered to the Indenture
Trustee.
It shall not be necessary for any Act of Noteholders under this Section
9.02 to approve the particular form of any proposed supplemental indenture, but
it shall be sufficient if such Act shall approve the substance thereof.
Promptly after the execution by the Issuer and the Indenture Trustee of
any supplemental indenture pursuant to this Section 9.02, the Indenture Trustee
shall mail to the Holders of the Notes to which such amendment or supplemental
indenture relates a notice setting forth in general terms the substance of such
supplemental indenture. Any failure of the Indenture Trustee to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such supplemental indenture.
Section 9.03 EXECUTION OF SUPPLEMENTAL INDENTURES. In executing, or
permitting the additional trusts created by, any supplemental indenture
permitted by this Article IX or the modification thereby of the trusts created
by this Indenture, the Indenture Trustee shall be entitled
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to receive, and subject to Sections 6.01 and 6.02 hereof, shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution of
such supplemental indenture is authorized or permitted by this Indenture. The
Indenture Trustee may, but shall not be obligated to, enter into any such
supplemental indenture that affects the Indenture Trustee's own rights, duties,
liabilities or immunities under this Indenture or otherwise.
Section 9.04 EFFECT OF SUPPLEMENTAL INDENTURE. Upon the execution of
any supplemental indenture pursuant to the provisions hereof, this Indenture
shall be and shall be deemed to be modified and amended in accordance therewith
with respect to the Notes affected thereby, and the respective rights,
limitations of rights, obligations, duties, liabilities and immunities under
this Indenture of the Indenture Trustee, the Issuer and the Holders of the Notes
shall thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.
Section 9.05 CONFORMITY WITH TRUST INDENTURE ACT. Every amendment of
this Indenture and every supplemental indenture executed pursuant to this
Article IX shall conform to the requirements of the Trust Indenture Act as then
in effect so long as this Indenture shall then be qualified under the Trust
Indenture Act.
Section 9.06 REFERENCE IN NOTES TO SUPPLEMENTAL INDENTURES. Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article IX may, and if required by the Indenture Trustee shall,
bear a notation in form approved by the Indenture Trustee as to any matter
provided for in such supplemental indenture. If the Issuer or the Indenture
Trustee shall so determine, new Notes so modified as to conform, in the opinion
of the Indenture Trustee and the Issuer, to any such supplemental indenture may
be prepared and executed by the Issuer and authenticated and delivered by the
Indenture Trustee in exchange for Outstanding Notes.
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ARTICLE X
Miscellaneous
Section 10.01 COMPLIANCE CERTIFICATES AND OPINIONS, ETC. (a) Upon any
application or request by the Issuer to the Indenture Trustee to take any action
under any provision of this Indenture, the Issuer shall furnish to the Indenture
Trustee (i) an Officer's Certificate stating that all conditions precedent, if
any, provided for in this Indenture relating to the proposed action have been
complied with and (ii) an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been complied with, except
that, in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture,
no additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that each signatory of such certificate or
opinion has read or has caused to be read such covenant or condition
and the definitions herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such signatory,
such signatory has made such examination or investigation as is
necessary to enable such signatory to express an informed opinion as to
whether or not such covenant or condition has been complied with;
(4) a statement as to whether, in the opinion of each such
signatory, such condition or covenant has been complied with; and
(5) if the signatory of such certificate or opinion is
required to be Independent, the statement required by the definition of
the term "Independent".
(b) (i) Prior to the deposit of any Collateral or other property or
securities with the Indenture Trustee that is to be made the basis for the
release of any property or securities subject to the lien of this Indenture, the
Issuer shall, in addition to any obligation imposed in Section 10.01 (a) or
elsewhere in this Indenture, furnish to the Indenture Trustee an Officer's
Certificate certifying or stating the opinion of each person signing such
certificate as to the fair value (within 90 days prior to such deposit) to the
Issuer of the Collateral or other property or securities to be so deposited and
a report from a nationally recognized accounting firm verifying such value.
(ii) Whenever the Issuer is required to furnish to
the Indenture Trustee an Officer's Certificate certifying or stating
the opinion of any signer thereof as to the matters described in clause
(i) above, the Issuer shall also deliver to the Indenture Trustee an
Independent Certificate from a nationally recognized accounting firm as
to the same matters, if the fair value of the securities to be so
deposited and of all other such securities made the
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basis of any such withdrawal or release since the commencement of the
then current fiscal year of the Issuer, as set forth in the
certificates delivered pursuant to clause (i) above and this clause
(ii), is 10% or more of the Note Principal Balances of the Notes, but
such a certificate need not be furnished with respect to any securities
so deposited, if the fair value thereof as set forth in the related
Officer's Certificate is less than $25,000 or less than one percent of
the Note Principal Balances of the Notes.
(iii) Whenever any property or securities are to be
released from the lien of this Indenture, the Issuer shall also furnish
to the Indenture Trustee an Officer's Certificate certifying or stating
the opinion of each person signing such certificate as to the fair
value (within 90 days prior to such release) of the property or
securities proposed to be released and stating that in the opinion of
such person the proposed release will not impair the security under
this Indenture in contravention of the provisions hereof.
(iv) Whenever the Issuer is required to furnish to
the Indenture Trustee an Officer's Certificate certifying or stating
the opinion of any signer thereof as to the matters described in clause
(iii) above, the Issuer shall also furnish to the Indenture Trustee an
Independent Certificate as to the same matters if the fair value of the
property or securities and of all other property or securities released
from the lien of this Indenture since the commencement of the
then-current calendar year, as set forth in the certificates required
by clause (iii) above and this clause (iv), equals 10% or more of the
Note Principal Balances of the Notes, but such certificate need not be
furnished in the case of any release of property or securities if the
fair value thereof as set forth in the related Officer's Certificate is
less than $25,000 or less than one percent of the then Note Principal
Balances of the Notes.
Section 10.02 FORM OF DOCUMENTS DELIVERED TO INDENTURE TRUSTEE. In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other matters, and any such Person may certify or give an opinion
as to such matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the Issuer may
be based, insofar as it relates to legal matters, upon a certificate or opinion
of, or representations by, counsel, unless such officer knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his certificate or
opinion is based are erroneous. Any such certificate of an Authorized Officer or
Opinion of Counsel may be based, insofar as it relates to factual matters, upon
a certificate or opinion of, or representations by, an officer or officers of
the Seller or the Issuer, stating that the information with respect to such
factual matters is in the possession of the Seller or the Issuer, unless such
counsel knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to such matters are
erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
64
Whenever in this Indenture, in connection with any application or
certificate or report to the Indenture Trustee, it is provided that the Issuer
shall deliver any document as a condition of the granting of such application,
or as evidence of the Issuer's compliance with any term hereof, it is intended
that the truth and accuracy, at the time of the granting of such application or
at the effective date of such certificate or report (as the case may be), of the
facts and opinions stated in such document shall in such case be conditions
precedent to the right of the Issuer to have such application granted or to the
sufficiency of such certificate or report. The foregoing shall not, however, be
construed to affect the Indenture Trustee's right to rely upon the truth and
accuracy of any statement or opinion contained in any such document as provided
in Article VI.
Section 10.03 ACTS OF NOTEHOLDERS. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Noteholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Noteholders in person or by agents duly appointed in writing; and except as
herein otherwise expressly provided, such action shall become effective when
such instrument or instruments are delivered to the Indenture Trustee, and,
where it is hereby expressly required, to the Issuer. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Noteholders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Indenture
and (subject to Section 6.01 hereof) conclusive in favor of the Indenture
Trustee and the Issuer, if made in the manner provided in this Section 10.03
hereof.
(b) The fact and date of the execution by any person of any such
instrument or writing may be proved in any manner that the Indenture Trustee
deems sufficient.
(c) The ownership of Notes shall be proved by the Note Registrar.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Notes shall bind the Holder of every
Note issued upon the registration thereof or in exchange therefor or in lieu
thereof, in respect of anything done, omitted or suffered to be done by the
Indenture Trustee or the Issuer in reliance thereon, whether or not notation of
such action is made upon such Note.
Section 10.04 NOTICES ETC., TO INDENTURE TRUSTEE ISSUER AND RATING
AGENCIES. Any request, demand, authorization, direction, notice, consent, waiver
or Act of Noteholders or other documents provided or permitted by this Indenture
shall be in writing and if such request, demand, authorization, direction,
notice, consent, waiver or act of Noteholders is to be made upon, given or
furnished to or filed with:
(i) the Indenture Trustee by any Noteholder or by the
Issuer shall be sufficient for every purpose hereunder if made, given,
furnished or filed in writing to or with the Indenture Trustee at the
Corporate Trust Office. The Indenture Trustee shall promptly transmit
any notice received by it from the Noteholders to the Issuer; or
(ii) the Issuer by the Indenture Trustee or by any
Noteholder shall be sufficient for every purpose hereunder if in
writing and mailed first-class, postage prepaid
65
to the Issuer addressed to: American Home Mortgage Investment Trust
2004-1, in care of Wilmington Trust Company, Xxxxxx Square North, 0000
Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000-0000, Attention:
Corporate Trust Administration, or at any other address previously
furnished in writing to the Indenture Trustee by the Issuer. The Issuer
shall promptly transmit any notice received by it from the Noteholders
to the Indenture Trustee; or
Notices required to be given to the Rating Agencies by the Issuer, the
Indenture Trustee or the Owner Trustee shall be in writing, mailed first-class
postage pre-paid, to Standard & Poor's, at the following address: Standard &
Poor's, 00 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention of
Asset Backed Surveillance Department; or as to each of the foregoing, at such
other address as shall be designated by written notice to the other parties.
Section 10.05 NOTICES TO NOTEHOLDERS; WAIVER. Where this Indenture
provides for notice to Noteholders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class, postage prepaid to each Noteholder affected by such
event, at such Person's address as it appears on the Note Register, not later
than the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice. In any case where notice to Noteholders is given by mail,
neither the failure to mail such notice nor any defect in any notice so mailed
to any particular Noteholder shall affect the sufficiency of such notice with
respect to other Noteholders, and any notice that is mailed in the manner herein
provided shall conclusively be presumed to have been duly given regardless of
whether such notice is in fact actually received.
Where this Indenture provides for notice in any manner, such notice may
be waived in writing by any Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Noteholders shall be filed with the Indenture
Trustee but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such a waiver.
In case, by reason of the suspension of regular mail service as a
result of a strike, work stoppage or similar activity, it shall be impractical
to mail notice of any event to Noteholders when such notice is required to be
given pursuant to any provision of this Indenture, then any manner of giving
such notice as shall be satisfactory to the Indenture Trustee shall be deemed to
be a sufficient giving of such notice.
Where this Indenture provides for notice to the Rating Agencies,
failure to give such notice shall not affect any other rights or obligations
created hereunder, and shall not under any circumstance constitute an Event of
Default.
Section 10.06 CONFLICT WITH TRUST INDENTURE ACT. If any provision
hereof limits, qualifies or conflicts with another provision hereof that is
required to be included in this Indenture by any of the provisions of the Trust
Indenture Act, such required provision shall control.
The provisions of TIA xx.xx. 310 through 317 that impose duties on any
Person (including the provisions automatically deemed included herein unless
expressly excluded by this Indenture) are a part of and govern this Indenture,
whether or not physically contained herein.
66
Section 10.07 EFFECT OF HEADINGS. The Article and Section headings
herein are for convenience only and shall not affect the construction hereof.
Section 10.08 SUCCESSORS AND ASSIGNS. All covenants and agreements in
this Indenture and the Notes by the Issuer shall bind its successors and
assigns, whether so expressed or not. All agreements of the Indenture Trustee in
this Indenture shall bind its successors, co-trustees and agents.
Section 10.09 SEPARABILITY. In case any provision in this Indenture or
in the Notes shall be invalid, illegal or unenforceable, the validity, legality,
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
Section 10.10 [RESERVED].
Section 10.11 LEGAL HOLIDAYS. In any case where the date on which any
payment is due shall not be a Business Day, then (notwithstanding any other
provision of the Notes or this Indenture) payment need not be made on such date,
but may be made on the next succeeding Business Day with the same force and
effect as if made on the date on which nominally due, and no interest shall
accrue for the period from and after any such nominal date.
Section 10.12 GOVERNING LAW. THIS INDENTURE SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 10.13 COUNTERPARTS. This Indenture may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.
Section 10.14 RECORDING OF INDENTURE. If this Indenture is subject to
recording in any appropriate public recording offices, such recording is to be
effected by the Issuer and at its expense accompanied by an Opinion of Counsel
at its expense (which may be counsel to the Indenture Trustee or any other
counsel reasonably acceptable to the Indenture Trustee) to the effect that such
recording is necessary either for the protection of the Noteholders or any other
Person secured hereunder or for the enforcement of any right or remedy granted
to the Indenture Trustee under this Indenture.
Section 10.15 ISSUER OBLIGATION. No recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer, the Owner Trustee or
the Indenture Trustee on the Notes or under this Indenture or any certificate or
other writing delivered in connection herewith or therewith, against (i) the
Indenture Trustee or the Owner Trustee in its individual capacity, (ii) any
owner of a beneficial interest in the Issuer or (iii) any partner, owner,
beneficiary, agent, officer, director, employee or agent of the Indenture
Trustee or the Owner Trustee in its individual capacity, any holder of a
beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee or
of any successor or assign of the Indenture Trustee or the Owner Trustee in its
individual capacity, except
67
as any such Person may have expressly agreed (it being understood that the
Indenture Trustee and the Owner Trustee have no such obligations in their
individual capacity) and except that any such partner, owner or beneficiary
shall be fully liable, to the extent provided by applicable law, for any unpaid
consideration for stock, unpaid capital contribution or failure to pay any
installment or call owing to such entity. For all purposes of this Indenture, in
the performance of any duties or obligations of the Issuer hereunder, the Owner
Trustee shall be subject to, and entitled to the benefits of, the terms and
provisions of Article VI, VII and VIII of the Trust Agreement.
Section 10.16 NO PETITION. The Indenture Trustee, by entering into this
Indenture, and each Noteholder, by accepting a Note, hereby covenant and agree
that they will not at any time prior to one year from the date of termination
hereof, institute against the Depositor or the Issuer, or join in any
institution against the Depositor or the Issuer of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any United States federal or state bankruptcy or similar law
in connection with any obligations relating to the Notes, this Indenture or any
of the Basic Documents.
Section 10.17 INSPECTION. The Issuer agrees that, at its expense, on
reasonable prior notice, it shall permit any representative of the Indenture
Trustee, during the Issuer's normal business hours, to examine all the books of
account, records, reports and other papers of the Issuer, to make copies and
extracts therefrom, to cause such books to be audited by Independent certified
public accountants, and to discuss the Issuer's affairs, finances and accounts
with the Issuer's officers, employees, and Independent certified public
accountants, all at such reasonable times and as often as may be reasonably
requested. The Indenture Trustee shall cause its representatives to hold in
confidence all such information except to the extent disclosure may be required
by law (and all reasonable applications for confidential treatment are
unavailing) and except to the extent that the Indenture Trustee may reasonably
determine that such disclosure is consistent with its obligations hereunder.
68
IN WITNESS WHEREOF, the Issuer and the Indenture 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.
AMERICAN HOME MORTGAGE
INVESTMENT TRUST 2004-1, as Issuer
Wilmington Trust Company, not in
its individual capacity but
solely as Owner Trustee
By: /s/ Xxxxx X. Xxxxxxxx
---------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Financial Services Officer
XXXXX FARGO BANK, NATIONAL
ASSOCIATION, as Indenture Trustee
By: /s/ Xxxxx X. Xxxxxxxxx
---------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President
STATE OF ____________ )
) ss.:
COUNTY OF ___________ )
On this 31st day of March, 2004, before me personally appeared
________________ to me known, who being by me duly sworn, did depose and say,
that he is the _______________ of the Indenture Trustee, one of the corporations
described in and which executed the above instrument; and that he signed his
name thereto by like order.
Notary Public
________________________________
NOTARY PUBLIC
[NOTARIAL SEAL]
STATE OF ____________)
) ss.:
COUNTY OF ____________)
On this 31st day of March, 2004, before me personally appeared
________________ to me known, who being by me duly sworn, did depose and say,
that he is an ________________ of the Indenture Trustee, one of the corporations
described in and which executed the above instrument; and that he signed his
name thereto by like order.
Notary Public
________________________________
NOTARY PUBLIC
[NOTARIAL SEAL]
STATE OF DELAWARE )
) ss.:
COUNTY OF NEW CASTLE )
On this 31st day of March, 2004, before me personally appeared
____________________ to me known, who being by me duly sworn, did depose and
say, that she is a Financial Services Officer of the Owner Trustee, one of the
entities described in and which executed the above instrument; and that she
signed her name thereto by like order.
Notary Public
________________________________
NOTARY PUBLIC
[NOTARIAL SEAL]
EXHIBIT A-1
FORM OF CLASS [_-A-_] NOTES
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE INDENTURE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS NOTE IS A NON-RECOURSE OBLIGATION OF THE ISSUER, AND IS LIMITED IN RIGHT OF
PAYMENT TO AMOUNTS AVAILABLE FROM THE TRUST AND THE NOTE INSURANCE POLICY AS
PROVIDED IN THE INDENTURE REFERRED TO BELOW. THE ISSUER IS NOT OTHERWISE
PERSONALLY LIABLE FOR PAYMENTS ON THIS NOTE.
PRINCIPAL OF THIS NOTE IS PAYABLE OVER TIME AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING PRINCIPAL OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT
SHOWN ON THE FACE HEREOF.
A-1-1
AMERICAN HOME MORTGAGE INVESTMENT TRUST 2004-1
MORTGAGE-BACKED NOTES
CLASS [_-A-_]
AGGREGATE NOTE PRINCIPAL NOTE INTEREST
BALANCE: $[ ] RATE: [ADJUSTABLE
RATE][___%]
INITIAL NOTE PRINCIPAL NOTE NO. 1
BALANCE OF THIS NOTE: $[ ]
PERCENTAGE INTEREST: 100% CUSIP NO. [ ]
American Home Mortgage Investment Trust 2004-1 (the "Issuer"), a
Delaware statutory trust, for value received, hereby promises to pay to Cede &
Co. or registered assigns, the principal sum of ($_________________) in monthly
installments on the twenty-fifth day of each month or, if such day is not a
Business Day, the next succeeding Business Day (each a "Payment Date"),
commencing in April 2004 and ending on or before the Payment Date occurring in
[_____________] (the "Final Scheduled Payment Date") and to pay interest on the
Note Principal Balance of this Note (this "Note") outstanding from time to time
as provided below.
This Note is one of a duly authorized issue of the Issuer's
Mortgage-Backed Notes, Series 2004-1 (the "Notes"), issued under an Indenture
dated as of March 31, 2004 (the "Indenture"), between the Issuer and Xxxxx Fargo
Bank, National Association, as indenture trustee (the "Indenture Trustee", which
term includes any successor Indenture Trustee under the Indenture), to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights thereunder of the Issuer, the Indenture
Trustee, and the Holders of the Notes and the terms upon which the Notes are to
be authenticated and delivered. All terms used in this Note which are defined in
the Indenture shall have the meanings assigned to them in the Indenture.
Payments of principal and interest on this Note will be made on each
Payment Date to the Noteholder of record as of the related Record Date. The
"Note Principal Balance" of a Note as of any date of determination is equal to
the initial Note Principal Balance thereof, reduced by the aggregate of all
amounts previously paid with respect to such Note on account of principal and
the aggregate amount of cumulative Realized Losses allocated to such Note on all
prior Payment Dates.
The principal of, and interest on, this Note are due and payable as
described in the Indenture, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts. All payments made by the Issuer with respect to this Note shall
be equal to this Note's pro rata share of the aggregate payments on all Class
[_-A-_] Notes as described above, and shall be applied as between interest and
principal as provided in the Indenture.
A-1-2
All [principal and] interest accrued on the Notes, if not previously
paid, will become finally due and payable at the Final Scheduled Payment Date.
The Notes are subject to redemption in whole, but not in part, by the
Majority Certificateholder on any Payment Date on or after the Payment Date on
which the aggregate Stated Principal Balance of the Mortgage Loans as of the end
of the prior Due Period is less than or equal to 10% of the aggregate Stated
Principal Balance of the Mortgage Loans as of Cut-off Date.
The Issuer shall not be liable upon the indebtedness evidenced by the
Notes except to the extent of amounts available from the Trust Estate which
constitutes security for the payment of the Notes. The assets included in the
Trust Estate will be the sole source of payments on the Class [_] Notes, and
each Holder hereof, by its acceptance of this Note, agrees that (i) such Note
will be limited in right of payment to amounts available from the Trust Estate
as provided in the Indenture and (ii) such Holder shall have no recourse to the
Issuer, the Owner Trustee, the Indenture Trustee, AHM SPV III, LLC, American
Home Mortgage Securities LLC, American Home Mortgage Investment Corp., the
Master Servicer or any of their respective affiliates, or to the assets of any
of the foregoing entities, except the assets of the Issuer pledged to secure the
Class [__] Notes pursuant to the Indenture and the rights conveyed to the Issuer
under the Indenture.
Any payment of principal or interest payable on this Note which is
punctually paid on the applicable Payment Date shall be paid to the Person in
whose name such Note is registered at the close of business on the Record Date
for such Payment Date by check mailed to such person's address as it appears in
the Note Register on such Record Date, except for the final installment of
principal and interest payable with respect to such Note, which shall be payable
as provided below. Notwithstanding the foregoing, upon written request with
appropriate instructions by the Holder of this Note delivered to the Indenture
Trustee at least five Business Days prior to the Record Date, any payment of
principal or interest, other than the final installment of principal or
interest, shall be made by wire transfer to an account in the United States
designated by such Holder. All reductions in the principal amount of a Note (or
one or more predecessor Notes) effected by payments of principal made on any
Payment Date shall be binding upon all Holders of this Note and of any Note
issued upon the registration of transfer thereof or in exchange therefor or in
lieu thereof, whether or not such payment is noted on such Note. The final
payment of this Note shall be payable upon presentation and surrender thereof on
or after the Payment Date thereof at the Corporate Trust Office or the office or
agency of the Issuer maintained by it for such purpose pursuant to Section 3.02
of the Indenture.
Subject to the foregoing provisions, each Note delivered under the
Indenture, upon registration of transfer of or in exchange for or in lieu of any
other Note shall carry the right to unpaid principal and interest that were
carried by such other Note.
If an Event of Default as defined in the Indenture shall occur and be
continuing with respect to the Notes, the Notes may become or be declared due
and payable in the manner and with the effect provided in the Indenture. If any
such acceleration of maturity occurs prior to the payment of the entire unpaid
Note Principal Balance of the Notes, the amount payable to the Holder of this
Note will be equal to the sum of the unpaid Note Principal Balance of the Notes,
together with accrued and unpaid interest thereon as described in the Indenture.
The Indenture provides that, notwithstanding
A-1-3
the acceleration of the maturity of the Notes, under certain circumstances
specified therein, all amounts collected as proceeds of the Trust Estate
securing the Notes or otherwise shall continue to be applied to payments of
principal of and interest on the Notes as if they had not been declared due and
payable.
The failure to pay any Unpaid Interest Shortfall at any time when funds
are not available to make such payment as provided in the Indenture shall not
constitute an Event of Default under the Indenture.
The Holder of this Note or Beneficial Owner of any interest herein is
deemed to represent that either (1) it is not acquiring the Note with Plan
Assets or (2) (A) the acquisition, holding and transfer of a Note will not give
rise to a nonexempt prohibited transaction under Section 406 of ERISA or Section
4975 of the Code and (B) the Notes are rated investment grade or better and such
person believes that the Notes are properly treated as indebtedness without
substantial equity features for purposes of the DOL Regulations, and agrees to
so treat the Notes. Alternatively, regardless of the rating of the Notes, such
person may provide the Indenture Trustee and the Owner Trustee with an opinion
of counsel, which opinion of counsel will not be at the expense of the Issuer,
the Seller, any Underwriter, the Owner Trustee, the Indenture Trustee, the
Master Servicer or any successor servicer which opines that the acquisition,
holding and transfer of such Note or interest therein is permissible under
applicable law, will not constitute or result in a non-exempt prohibited
transaction under ERISA or Section 4975 of the Code and will not subject the
Issuer, the Seller, the Depositor, any Underwriter, the Owner Trustee, the
Indenture Trustee, the Master Servicer or any successor servicer to any
obligation in addition to those undertaken in the Indenture.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Note may be registered on the Note Register of
the Issuer. Upon surrender for registration of transfer of, or presentation of a
written instrument of transfer for, this Note at the office or agency designated
by the Issuer pursuant to the Indenture, accompanied by proper instruments of
assignment in form satisfactory to the Indenture Trustee, one or more new Notes
of any authorized denominations and of a like aggregate initial Note Principal
Balance, will be issued to the designated transferee or transferees.
Prior to the due presentment for registration of transfer of this Note,
the Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture
Trustee may treat the Person in whose name this Note is registered as the owner
of such Note (i) on the applicable Record Date for the purpose of making
payments and interest of such Note, and (ii) on any other date for all other
purposes whatsoever, as the owner hereof, whether or not this Note be overdue,
and neither the Issuer, the Indenture Trustee nor any such agent of the Issuer
or the Indenture Trustee shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Notes under the Indenture at any
time by the Issuer with the consent of the Holders of a majority of each Class
of Notes affected thereby. The Indenture also contains provisions permitting the
Holders of Notes representing specified percentages of the aggregate Note
Principal Balance of the Notes on behalf of the Holders of all the Notes, to
waive any past Default under the Indenture and its
A-1-4
consequences. Any such waiver by the Holder, at the time of the giving thereof,
of this Note (or any one or more predecessor Notes) shall bind the Holder of
every Note issued upon the registration of transfer hereof or in exchange hereof
or in lieu hereof, whether or not notation of such consent or waiver is made
upon such Note. The Indenture also permits the Issuer and the Indenture Trustee
to amend or waive certain terms and conditions set forth in the Indenture
without the consent of the Holders of the Notes issued thereunder.
Initially, the Notes will be registered in the name of CEDE & Co. as
nominee of DTC, acting in its capacity as the Depository for the Notes. The
Notes will be delivered by the clearing agency in denominations as provided in
the Indenture and subject to certain limitations therein set forth. The Notes
are exchangeable for a like aggregate initial Note Principal Balance of Notes of
different authorized denominations, as requested by the Holder surrendering
same.
Unless the Certificate of Authentication hereon has been executed by
the Indenture Trustee by manual signature, this Note shall not be entitled to
any benefit under the Indenture, or be valid or obligatory for any purpose.
AS PROVIDED IN THE INDENTURE, THIS NOTE AND THE INDENTURE CREATING THIS
NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED THEREIN.
A-1-5
IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly
executed by Wilmington Trust Company, not in its individual capacity but solely
as Owner Trustee.
Dated: March 31, 2004
AMERICAN HOME MORTGAGE INVESTMENT
TRUST 2004-1
BY: WILMINGTON TRUST COMPANY, not in its
individual capacity but solely in its
capacity as Owner Trustee
By:______________________________________
Authorized Signatory
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class [__] Notes referred to in the within-mentioned
Indenture.
XXXXX FARGO BANK, NATIONAL ASSOCIATION, as Indenture Trustee
By:__________________________________
Authorized Signatory
A-1-6
ABBREVIATIONS
-------------
The following abbreviations, when used in the inscription on the face
of the Note, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship
and not as tenants in common
UNIF GIFT MIN ACT -- _____________________ Custodian
_________________________________
(Cust) (Minor)
under Uniform Gifts to Minor Act
_____________________
(State)
Additional abbreviations may also be used though not in the above list.
A-1-7
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF
ASSIGNEE:
___________________________________________________________
___________________________________________________________
___________________________________________________________
(Please print or typewrite name and address, including zip code, of assignee)
--------------------------------------------------------------------------------
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints attorney to transfer said Note on the books kept for registration
thereof, with full power of substitution in the premises.
Dated:_______________ ____________________________________________
Signature Guaranteed by _____________________________________________
NOTICE: The signature(s) to this assignment must correspond with the
name as it appears upon the face of the within Note in every particular, without
alteration or enlargement or any change whatsoever. Signature(s) must be
guaranteed by a commercial bank or by a member firm of the New York Stock
Exchange or another national securities exchange. Notarized or witnessed
signatures are not acceptable.
A-1-8
EXHIBIT A-2
FORM OF CLASS [__]-M-[_] NOTES
THIS NOTE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS [_-A-_] NOTES [AND
CLASS [__]-M-[__] NOTES] AS DESCRIBED IN THE INDENTURE.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE INDENTURE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THE HOLDER OF THIS NOTE OR BENEFICIAL OWNER OF ANY INTEREST HEREIN WILL BE
DEEMED TO REPRESENT TO ONE OF THE REPRESENTATIONS CONTAINED IN SECTION 4.15 OF
THE INDENTURE.
THIS NOTE IS A NON-RECOURSE OBLIGATION OF THE ISSUER, AND IS LIMITED IN RIGHT OF
PAYMENT TO AMOUNTS AVAILABLE FROM THE TRUST ESTATE AS PROVIDED IN THE INDENTURE
REFERRED TO BELOW. THE ISSUER IS NOT OTHERWISE PERSONALLY LIABLE FOR PAYMENTS ON
THIS NOTE.
PRINCIPAL OF THIS NOTE IS PAYABLE OVER TIME AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING PRINCIPAL OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT
SHOWN ON THE FACE HEREOF.
A-2-1
AMERICAN HOME MORTGAGE INVESTMENT TRUST 2004-1
MORTGAGE-BACKED NOTES
CLASS [__]-M-[_]
AGGREGATE NOTE PRINCIPAL NOTE INTEREST
BALANCE: RATE: [ %]
$[ ]
INITIAL NOTE PRINCIPAL NOTE NO. 1
BALANCE OF THIS NOTE: $[ ]
PERCENTAGE INTEREST: 100% CUSIP NO. [ ]
American Home Mortgage Investment Trust 2004-1 (the "Issuer"), a
Delaware statutory trust, for value received, hereby promises to pay to Cede &
Co. or registered assigns, the principal sum of ______________________________
($___________) in monthly installments on the twenty-fifth day of each month or,
if such day is not a Business Day, the next succeeding Business Day (each a
"Payment Date"), commencing in April 2004 and ending on or before the Payment
Date occurring in [______] (the "Final Scheduled Payment Date") and to pay
interest on the Note Principal Balance of this Note (this "Note") outstanding
from time to time as provided below.
This Note is one of a duly authorized issue of the Issuer's
Mortgage-Backed Notes, Series 2004-1 (the "Notes"), issued under an Indenture
dated as of March 31, 2004 (the "Indenture"), between the Issuer and Xxxxx Fargo
Bank, National Association, as indenture trustee (the "Indenture Trustee", which
term includes any successor Indenture Trustee under the Indenture), to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights thereunder of the Issuer, the Indenture
Trustee, and the Holders of the Notes and the terms upon which the Notes are to
be authenticated and delivered. All terms used in this Note which are defined in
the Indenture shall have the meanings assigned to them in the Indenture.
Payments of principal and interest on this Note will be made on each
Payment Date to the Noteholder of record as of the related Record Date. The
"Note Principal Balance" of a Note as of any date of determination is equal to
the initial Note Principal Balance thereof, reduced by the aggregate of all
amounts previously paid with respect to such Note on account of principal and
the aggregate amount of cumulative Realized Losses allocated to such Note on all
prior Payment Dates.
The principal of, and interest on, this Note are due and payable as
described in the Indenture, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts. All payments made by the Issuer with respect to this Note shall
be equal to this Note's pro rata share of the aggregate payments on all Class
[__]-M-[_] Notes as described above, and shall be applied as between interest
and principal as provided in the Indenture.
All principal and interest accrued on the Notes, if not previously
paid, will become finally due and payable at the Final Scheduled Payment Date.
A-2-2
The Notes are subject to redemption in whole, but not in part, by the
Majority Certificateholder on any Payment Date on or after the Payment Date on
which the aggregate Stated Principal Balance of the Mortgage Loans is less than
or equal to 10% of aggregate Stated Principal Balance of the Mortgage Loans as
of Cut-off Date.
The Issuer shall not be liable upon the indebtedness evidenced by the
Notes except to the extent of amounts available from the Trust Estate which
constitutes security for the payment of the Notes. The assets included in the
Trust Estate will be the sole source of payments on the Class [__]- M-[_] Notes,
and each Holder hereof, by its acceptance of this Note, agrees that (i) such
Note will be limited in right of payment to amounts available from the Trust
Estate as provided in the Indenture and (ii) such Holder shall have no recourse
to the Issuer, the Owner Trustee, the Indenture Trustee, American Home Mortgage
Securities LLC, American Home Mortgage Investment Corp., the Master Servicer or
any of their respective affiliates, or to the assets of any of the foregoing
entities, except the assets of the Issuer pledged to secure the Class [__]-M-[_]
Notes pursuant to the Indenture and the rights conveyed to the Issuer under the
Indenture.
Any payment of principal or interest payable on this Note which is
punctually paid on the applicable Payment Date shall be paid to the Person in
whose name such Note is registered at the close of business on the Record Date
for such Payment Date by check mailed to such person's address as it appears in
the Note Register on such Record Date, except for the final installment of
principal and interest payable with respect to such Note, which shall be payable
as provided below. Notwithstanding the foregoing, upon written request with
appropriate instructions by the Holder of this Note delivered to the Indenture
Trustee at least five Business Days prior to the Record Date, any payment of
principal or interest, other than the final installment of principal or
interest, shall be made by wire transfer to an account in the United States
designated by such Holder. All reductions in the principal amount of a Note (or
one or more predecessor Notes) effected by payments of principal made on any
Payment Date shall be binding upon all Holders of this Note and of any Note
issued upon the registration of transfer thereof or in exchange therefor or in
lieu thereof, whether or not such payment is noted on such Note. The final
payment of this Note shall be payable upon presentation and surrender thereof on
or after the Payment Date thereof at the Corporate Trust Office or the office or
agency of the Issuer maintained by it for such purpose pursuant to Section 3.02
of the Indenture.
Subject to the foregoing provisions, each Note delivered under the
Indenture, upon registration of transfer of or in exchange for or in lieu of any
other Note shall carry the right to unpaid principal and interest that were
carried by such other Note.
If an Event of Default as defined in the Indenture shall occur and be
continuing with respect to the Notes, the Notes may become or be declared due
and payable in the manner and with the effect provided in the Indenture. If any
such acceleration of maturity occurs prior to the payment of the entire unpaid
Note Principal Balance of the Notes, the amount payable to the Holder of this
Note will be equal to the sum of the unpaid Note Principal Balance of the Notes,
together with accrued and unpaid interest thereon as described in the Indenture.
The Indenture provides that, notwithstanding the acceleration of the maturity of
the Notes, under certain circumstances specified therein, all amounts collected
as proceeds of the Trust Estate securing the Notes or otherwise shall continue
to
A-2-3
be applied to payments of principal of and interest on the Notes as if they had
not been declared due and payable.
The failure to pay any Unpaid Interest Shortfall at any time when funds
are not available to make such payment as provided in the Indenture shall not
constitute an Event of Default under the Indenture.
The Holder of this Note or Beneficial Owner of any interest herein is
deemed to represent that either (1) it is not acquiring the Note with Plan
Assets or (2) (A) the acquisition, holding and transfer of a Note will not give
rise to a nonexempt prohibited transaction under Section 406 of ERISA or Section
4975 of the Code and (B) the Notes are rated investment grade or better and such
person believes that the Notes are properly treated as indebtedness without
substantial equity features for purposes of the DOL Regulations, and agrees to
so treat the Notes. Alternatively, regardless of the rating of the Notes, such
person may provide the Indenture Trustee and the Owner Trustee with an opinion
of counsel, which opinion of counsel will not be at the expense of the Issuer,
the Seller, any Underwriter, the Owner Trustee, the Indenture Trustee, the
Master Servicer or any successor servicer which opines that the acquisition,
holding and transfer of such Note or interest therein is permissible under
applicable law, will not constitute or result in a non-exempt prohibited
transaction under ERISA or Section 4975 of the Code and will not subject the
Issuer, the Seller, the Depositor, any Underwriter, the Owner Trustee, the
Indenture Trustee, the Master Servicer or any successor servicer to any
obligation in addition to those undertaken in the Indenture.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Note may be registered on the Note Register of
the Issuer. Upon surrender for registration of transfer of, or presentation of a
written instrument of transfer for, this Note at the office or agency designated
by the Issuer pursuant to the Indenture, accompanied by proper instruments of
assignment in form satisfactory to the Indenture Trustee, one or more new Notes
of any authorized denominations and of a like aggregate initial Note Principal
Balance, will be issued to the designated transferee or transferees.
Prior to the due presentment for registration of transfer of this Note,
the Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture
Trustee may treat the Person in whose name this Note is registered as the owner
of such Note (i) on the applicable Record Date for the purpose of making
payments and interest of such Note, and (ii) on any other date for all other
purposes whatsoever, as the owner hereof, whether or not this Note be overdue,
and neither the Issuer, the Indenture Trustee nor any such agent of the Issuer
or the Indenture Trustee shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Notes under the Indenture at any
time by the Issuer with the consent of the Holders of a majority of each Class
of Notes affected thereby. The Indenture also contains provisions permitting the
Holders of Notes representing specified percentages of the aggregate Note
Principal Balance of the Notes on behalf of the Holders of all the Notes, to
waive any past Default under the Indenture and its consequences. Any such waiver
by the Holder, at the time of the giving thereof, of this Note (or any one or
more predecessor Notes) shall bind the Holder of every Note issued upon the
registration of
A-2-4
transfer hereof or in exchange hereof or in lieu hereof, whether or not notation
of such consent or waiver is made upon such Note. The Indenture also permits the
Issuer and the Indenture Trustee to amend or waive certain terms and conditions
set forth in the Indenture without the consent of the Holders of the Notes
issued thereunder.
Initially, the Notes will be registered in the name of Cede & Co. as
nominee of DTC, acting in its capacity as the Depository for the Notes. The
Notes will be delivered by the clearing agency in denominations as provided in
the Indenture and subject to certain limitations therein set forth. The Notes
are exchangeable for a like aggregate initial Note Principal Balance of Notes of
different authorized denominations, as requested by the Holder surrendering
same.
Unless the Certificate of Authentication hereon has been executed by
the Indenture Trustee by manual signature, this Note shall not be entitled to
any benefit under the Indenture, or be valid or obligatory for any purpose.
AS PROVIDED IN THE INDENTURE, THIS NOTE AND THE INDENTURE CREATING THIS
NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED THEREIN.
A-2-5
IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly
executed by Wilmington Trust Company, not in its individual capacity but solely
as Owner Trustee.
Dated: March 31, 2004
AMERICAN HOME MORTGAGE INVESTMENT
TRUST 2004-1
BY: WILMINGTON TRUST COMPANY, not in
its individual capacity but solely
in its capacity as Owner Trustee
By: ___________________________________
Authorized Signatory
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class [__]-M-[_] Notes referred to in the within-mentioned
Indenture.
XXXXX FARGO BANK, NATIONAL ASSOCIATION, as Indenture Trustee
By: _________________________________
Authorized Signatory
A-2-6
ABBREVIATIONS
-------------
The following abbreviations, when used in the inscription on the face
of the Note, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship
and not as tenants in common
UNIF GIFT MIN ACT -- _____________________ Custodian
_________________________________
(Cust) (Minor)
under Uniform Gifts to Minor Act
_____________________
(State)
Additional abbreviations may also be used though not in the above list.
A-2-7
ASSIGNMENT
----------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF
ASSIGNEE:
___________________________________________________________
___________________________________________________________
___________________________________________________________
(Please print or typewrite name and address, including zip code, of assignee)
--------------------------------------------------------------------------------
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints ________________________ attorney to transfer said Note on the
books kept for registration thereof, with full power of substitution in the
premises.
Dated: ____________________ _______________________________
Signature Guaranteed by ____________________________________________________
NOTICE: The signature(s) to this assignment must correspond with the
name as it appears upon the face of the within Note in every particular, without
alteration or enlargement or any change whatsoever. Signature(s) must be
guaranteed by a commercial bank or by a member firm of the New York Stock
Exchange or another national securities exchange. Notarized or witnessed
signatures are not acceptable.
A-2-8
EXHIBIT B
MORTGAGE LOAN SCHEDULE
(Filed Manually)
A-3-1
APPENDIX A
DEFINITIONS
ACCRUAL PERIOD: With respect to any Payment Date and each class of
Group I Notes, the period from the preceding Payment Date (or in the case of the
first Payment Date, from the Closing Date) through the day preceding such
Payment Date. With respect to any Payment Date and each class of Notes, other
than the Group I Notes, the prior calendar month.
ACCRUED NOTE INTEREST: With respect to any Payment Date and each class
of Notes, interest accrued during the related Accrual Period at the
then-applicable Note Interest Rate on the related Note Principal Balance thereof
immediately prior to such Payment Date, plus any Accrued Note Interest remaining
unpaid from any prior Payment Date with interest thereon at the related Note
Interest Rate. Accrued Note Interest for the Group I Notes shall be calculated
on the basis of the actual number of days in the Accrual Period and a 360-day
year. Accrued Note Interest on the Notes, other than the Group I Notes, shall be
calculated on the basis of the 360-day year consisting of twelve 30-day months.
ADJUSTMENT DATE: As to each Mortgage Loan, each date set forth in the
related Mortgage Note on which an adjustment to the interest rate on such
Mortgage Loan becomes effective.
ADVANCE: As to any Mortgage Loan, any advance made by the Master
Servicer pursuant to Section 4.04 of the Servicing Agreement or by a Subservicer
in respect of delinquent Monthly Payments of principal and interest pursuant to
the related Subservicing Agreement.
AFFILIATE: With respect to any Person, any other Person controlling,
controlled by or under common control with such Person. For purposes of this
definition, "control" means the power to direct the management and policies of a
Person, directly or indirectly, whether through ownership of voting securities,
by contract or otherwise and "controlling" and "controlled" shall have meanings
correlative to the foregoing.
ALLOCATED REALIZED LOSS AMOUNT: With respect to any class of Class M
Notes and any Payment Date, an amount equal to the sum of any related Realized
Loss allocated to that Class of Notes on that Payment Date and any Allocated
Realized Loss Amount for that Class remaining unpaid from the previous Payment
Date, in each case, with interest thereon at the applicable Note Interest Rate
for such Payment Date for such Class for the related Accrual Period.
APPRAISED VALUE: The appraised value of a Mortgaged Property based upon
the lesser of (i) the appraisal made at the time of the origination of the
related Mortgage Loan, or (ii) the sale price of such Mortgaged Property at such
time of origination. With respect to a Mortgage Loan, the proceeds of which were
used to refinance an existing Mortgage Loan, the appraised value of the
Mortgaged Property based upon the appraisal obtained at the time of refinancing.
ARM LOANS: At any time, collectively, all the Mortgage Loans which have
adjustable Mortgage Rates.
ASSIGNMENT OF MORTGAGE: An assignment of Mortgage, notice of transfer
or equivalent instrument, in recordable form, which is sufficient under the laws
of the jurisdiction wherein the related Mortgaged Property is located to reflect
of record the sale of the Mortgage, which assignment, notice of transfer or
equivalent instrument may be in the form of one or more blanket assignments
covering Mortgages secured by Mortgaged Properties located in the same county,
if permitted by law.
AUTHORIZED NEWSPAPER: A newspaper of general circulation in the Borough
of Manhattan, The City of New York, printed in the English language and
customarily published on each Business Day, whether or not published on
Saturdays, Sundays or holidays.
AUTHORIZED OFFICER: With respect to the Issuer, any officer of the
Owner Trustee who is authorized to act for the Owner Trustee in matters relating
to the Issuer and who is identified on the list of Authorized Officers delivered
by the Owner Trustee to the Indenture Trustee on the Closing Date (as such list
may be modified or supplemented from time to time thereafter).
AVAILABLE FUNDS: The Group I Available Funds, Group II Available Funds,
Group III Available Funds or Group IV Available Funds, as applicable.
AVAILABLE FUNDS RATE: On any Payment Date and the Group I Notes, the
per annum rate equal to the product of:
(i) the product of:
(1) the weighted average of the Net Mortgage Rates
on the Group I Loans included in the trust as of the end
of the prior Due Period, weighted on the basis of the
Stated Principal Balances thereof as of the end of the
prior Due Period and
(2) a fraction equal to
(x) the aggregate Stated Principal Balance
of the Group I Loans as of the end of the prior Due
Period divided by
(y) the aggregate Note Principal Balance of
the Class I-A, Class I-M-1, Class I-M-2 and Class
I-M-3 Notes immediately prior to such Payment Date,
and
(ii) a fraction equal to (x) 30 divided by (y) the number of days in
the related Accrual Period.
On any Payment Date and the Group II Notes, the per annum rate equal to
the product of (1) the weighted average of the Net Mortgage Rates on the Group
II Loans included in the trust as of the end of the prior Due Period, weighted
on the basis of the Stated Principal Balances thereof as of the end of the prior
Due Period and (2) a fraction equal to (x) the aggregate Stated Principal
Balance of
2
the Group II Loans as of the end of the prior Due Period divided by (y) the
aggregate Note Principal Balance of the Class II-A, Class II-M-1, Class II-M-2
and Class II-M-3 Notes immediately prior to such Payment Date.
On any Payment Date and the Group III Notes, the per annum rate equal
to the product of (1) the weighted average of the Net Mortgage Rates on the
Group III Loans included in the trust as of the end of the prior Due Period,
weighted on the basis of the Stated Principal Balances thereof as of the end of
the prior Due Period and (2) a fraction equal to (x) the aggregate Stated
Principal Balance of the Group III Loans as of the end of the prior Due Period
divided by (y) the aggregate Note Principal Balance of the Class III-A, Class
III-M-1 and Class III-M-2 Notes immediately prior to such Payment Date.
On any Payment Date and the Group IV Notes, the per annum rate equal to
the product of (1) the weighted average of the Net Mortgage Rates on the Group
IV Loans included in the trust as of the end of the prior Due Period, weighted
on the basis of the Stated Principal Balances thereof as of the end of the prior
Due Period and (2) a fraction equal to (x) the aggregate Stated Principal
Balance of the Group IV Loans as of the end of the prior Due Period divided by
(y) the aggregate Note Principal Balance of the Class IV-A, Class IV-M-1, Class
IV-M-2 and Class IV-M-3 Notes immediately prior to such Payment Date.
BANKRUPTCY CODE: The Bankruptcy Code of 1978, as amended.
BASIC DOCUMENTS: The Trust Agreement, the Certificate of Trust, the
Indenture, the Custodial Agreement, the Notes, the Trust Certificates, the
Servicing Agreement, the Mortgage Loan Purchase Agreement and the other
documents and certificates delivered in connection with any of the above.
BASIC PRINCIPAL DISTRIBUTION AMOUNT: With respect to any Payment Date
and each Loan Group, the lesser of (a) the excess of (i) the related Available
Funds for such Payment Date over (ii) the aggregate amount of Accrued Note
Interest for the related Notes for such Payment Date and (b) the related
Principal Remittance Amount for such Payment Date.
BASIS RISK SHORTFALL: With respect to any class of LIBOR Notes, on each
Payment Date where clause (iii) of the definition of "Note Interest Rate" is
less than clauses (i) or (ii) of the definition of "Note Interest Rate," the
excess, if any, of (x) the aggregate Accrued Note Interest thereon for such
Payment Date calculated pursuant to the lesser of clause (i) or (ii) of the
definition of Note Interest Rate over (y) interest accrued on the related
Mortgage Loans at the related Available Funds Rate.
BASIS RISK SHORTFALL CARRY-FORWARD AMOUNT: With respect to each class
of LIBOR Notes and any Payment Date, as determined separately for each such
class of Notes, an amount equal to the aggregate amount of Basis Risk Shortfall
for such Notes on such Payment Date, plus any unpaid Basis Risk Shortfall for
such class of Notes from prior Payment Dates, plus interest thereon at the Note
Interest Rate for such Payment Date for such class for the related Accrual
Period, to the extent previously unreimbursed by the related Net Monthly Excess
Cashflow.
BENEFICIAL OWNER: With respect to any Book-Entry Note, the Person who
is the beneficial owner of such Note as reflected on the books of the Depository
or on the books of a Person
3
maintaining an account with such Depository (directly as a Depository
Participant or indirectly through a Depository Participant, in accordance with
the rules of such Depository).
BOOK-ENTRY NOTES: Beneficial interests in the Notes, ownership and
transfers of which shall be made through book entries by the Depository as
described in Section 4.06 of the Indenture.
BUSINESS DAY: Any day other than (i) a Saturday or a Sunday or (ii) a
day on which banking institutions in the City of New York, Delaware or Maryland
or in the city in which the Corporate Trust Office is located, is required or
authorized by law to be closed.
CALENDAR QUARTER: A Calendar Quarter shall consist of one of the
following time periods in any given year: January 1 through March 31, April 1
through June 30, July 1 though September 30, and October 1 through December 31.
CASH LIQUIDATION: As to any defaulted Mortgage Loan other than a
Mortgage Loan as to which an REO Acquisition occurred, a determination by the
Master Servicer evidenced in a certificate of a Servicing Officer that it has
received all Insurance Proceeds, Liquidation Proceeds and other payments or cash
recoveries which the Master Servicer reasonably and in good faith expects to be
finally recoverable with respect to such Mortgage Loan.
CERTIFICATE DISTRIBUTION ACCOUNT: The account or accounts created and
maintained pursuant to Section 3.10(c) of the Trust Agreement. The Certificate
Distribution Account shall be an Eligible Account.
CERTIFICATE PAYING AGENT: Initially, the Indenture Trustee, in its
capacity as Certificate Paying Agent, or any successor to the Indenture Trustee
in such capacity.
CERTIFICATE PERCENTAGE INTEREST: With respect to each Certificate, the
Certificate Percentage Interest stated on the face thereof.
CERTIFICATE REGISTER: The register maintained by the Certificate
Registrar in which the Certificate Registrar shall provide for the registration
of Certificates and of transfers and exchanges of Certificates.
CERTIFICATE REGISTRAR: Initially, the Indenture Trustee, in its
capacity as Certificate Registrar, or any successor to the Indenture Trustee in
such capacity.
CERTIFICATE OF TRUST: The Certificate of Trust filed for the Trust
pursuant to Section 3810(a) of the Statutory Trust Statute.
CERTIFICATES OR TRUST CERTIFICATES: The American Home Mortgage
Investment Trust 2004-1 Trust Certificates, Series 2004-1, evidencing the
beneficial ownership interest in the Issuer and executed by the Owner Trustee in
substantially the form set forth in Exhibit A to the Trust Agreement.
4
CERTIFICATEHOLDER OR HOLDER: The Person in whose name a Certificate is
registered in the Certificate Register. Owners of Certificates that have been
pledged in good faith may be regarded as Holders if the pledgee establishes to
the satisfaction of the Certificate Registrar or the Owner Trustee, as the case
may be, the pledgee's right so to act with respect to such Certificates and that
the pledgee is not the Issuer, any other obligor upon the Certificates or any
Affiliate of any of the foregoing Persons.
CLASS: Any of the Class A Notes or Class M Notes.
CLASS A NOTES: The Class I-A, Class II-A, Class III-A and Class IV-A
Notes in the form attached as Exhibit A-1 to the Indenture.
CLASS M NOTES: The Class I-M-1, Class I-M-2, Class I-M-3, Class II-M-1,
Class II-M-2, Class II-M-3, Class III-M-1, Class III-M-2, Class IV-M-1, Class
IV-M-2 and Class IV-M-3 Notes in the form attached as Exhibit A-2 to the
Indenture.
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: March 31, 2004.
CODE: The Internal Revenue Code of 1986, as amended, and the rules and
regulations promulgated thereunder.
COLLATERAL: The meaning specified in the Granting Clause of the
Indenture.
COLLECTION ACCOUNT: The account or accounts created and maintained
pursuant to Section 3.06(d) of the Servicing Agreement. The Collection Account
shall be an Eligible Account.
COMMISSION: The Securities and Exchange Commission.
COMPENSATING INTEREST: With respect to any Payment Date as determined
separately for each Loan Group, the amount of any Prepayment Interest Shortfalls
resulting from prepayments in full or in part during the preceding calendar
month on the related Mortgage Loans, but only to the extent such Prepayment
Interest Shortfalls do not exceed the Master Servicing Fee for such Payment
Date.
CORPORATE TRUST OFFICE: With respect to the Indenture Trustee,
Certificate Registrar, Certificate Paying Agent and Paying Agent, the principal
corporate trust office of the Indenture Trustee and Note Registrar at which at
any particular time its corporate trust business shall be administered, which
office at the date of the execution of this instrument is located at (1) for
purposes of the transfer and exchange of the Notes, c/o Sixth Street and
Marquette Avenue, Minneapolis, Minnesota 55479-0113, Attention: Corporate Trust
Services American Home Mortgage Securities LLC, Series 2004-1 and (2) for all
other purposes, 0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000, Attention:
Client Manager American Home Mortgage Securities LLC., Series 2004-1. With
respect to the Owner Trustee, the principal corporate trust office of the Owner
Trustee at which at any particular time its corporate trust business shall be
administered, which office
5
at the date of the execution of this Trust Agreement is located at Wilmington
Trust Company, Xxxxxx Square North, 0000 Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxxx,
Xxxxxxxx 00000, Attention: American Home Mortgage Investment Trust 2004-1.
CROSS-COLLATERALIZED LOSS PAYMENTS: For any Payment Date and each Loan
Group, the amount, if any, of Crossable Loss Crossable Excess from such Loan
Group available to cover Crossable Losses in the other Loan Groups as provided
in Section 3.05(o) of the Indenture.
CROSS-COLLATERALIZED UNDERCOLLATERALIZATION PAYMENTS: For any Payment
Date and each Loan Group, the amount, if any, of Undercollateralization Payment
Crossable Excess from such Loan Group available to cover Crossable
Undercollateralization Amounts in the other Loan Groups as provided in Section
3.05(n) of the Indenture.
CROSSABLE LOSS CROSSABLE EXCESS: With respect to Loan Group I, Loan
Group II, Loan Group III and Loan Group IV and any Payment Date, an amount equal
to the related Net Monthly Excess Cashflow remaining after the payment of Net
Monthly Excess Cashflow as set forth in clauses (d)(iii), (g)(iii), (j)(iii) and
(m)(iii) of Section 3.05 of the Indenture, respectively.
CROSSABLE LOSSES: With respect to any Loan Group and any Payment Date,
an amount equal to the sum of (i) any Realized Losses on the related Mortgage
Loans during the related Due Period, to the extent unreimbursed by related Net
Monthly Excess Cashflow on that Payment Date and (ii) any previously
unreimbursed Realized Losses on the related Mortgage Loans, to the extent that
such Realized Losses have not been reimbursed by related and non-related Net
Monthly Excess Cashflow on prior Payment Dates.
CROSSABLE UNDERCOLLATERALIZATION AMOUNT: With respect to any Loan Group
and any Payment Date, an amount equal to (x) the excess, if any, of (i) the
aggregate Bond Principal Balance of the related Notes immediately prior to that
Payment Date, over (ii) the aggregate Stated Principal Balance of the related
Mortgage Loans as of the beginning of the related Due Period, minus (y) any
amounts in respect of the related Undercollateralization Amount paid from
related Net Monthly Excess Cashflow on that Payment Date.
CUMULATIVE LOSSES: As to any Payment Date and the Mortgage Loans, the
cumulative aggregate amount of Realized Losses on the Mortgage Loans from the
Cut-off Date through the end of the calendar month immediately preceding such
Payment Date.
CUSTODIAN: Deutsche Bank National Trust Company, or its successor in
interest.
CUSTODIAL AGREEMENT: The Custodial Agreement, dated as of the Closing
Date, by and among the Indenture Trustee, the Depositor, the Master Servicer and
the Custodian.
CUT-OFF DATE: March 1, 2004.
CUT-OFF DATE BALANCE: The aggregate Stated Principal Balance of the
Mortgage Loans as of the Cut-off Date.
6
CUT-OFF DATE PRINCIPAL BALANCE: With respect to any Mortgage Loan, the
unpaid principal balance thereof as of the Cut-off Date after applying the
principal portion of Monthly Payments due on or before such date, whether or not
received, and without regard to any payments due after such date.
DEBT SERVICE REDUCTION: With respect to any Mortgage Loan, a reduction
in the scheduled Monthly Payment for such Mortgage Loan by a court of competent
jurisdiction in a proceeding under the Bankruptcy Code, except such a reduction
constituting a Deficient Valuation or any reduction that results in a permanent
forgiveness of principal.
DEFAULT: Any occurrence which with notice or the lapse of time or both
would become an Event of Default.
DEFICIENT VALUATION: With respect to any Mortgage Loan, a valuation by
a court of competent jurisdiction of the Mortgaged Property in an amount less
than the then outstanding indebtedness under the Mortgage Loan, or any reduction
in the amount of principal to be paid in connection with any scheduled Monthly
Payment that constitutes a permanent forgiveness of principal, which valuation
or reduction results from a proceeding under the Bankruptcy Code.
DEFINITIVE NOTES: The meaning specified in Section 4.06 of the
Indenture.
DELETED MORTGAGE LOAN: A Mortgage Loan replaced or to be replaced with
an Eligible Substitute Mortgage Loan.
DEPOSITOR: American Home Mortgage Securities LLC., a Delaware
corporation, or its successor in interest.
DEPOSITORY OR DEPOSITORY AGENCY: The Depository Trust Company or a
successor appointed by the Indenture Trustee. Any successor to the Depository
shall be an organization registered as a "clearing agency" pursuant to Section
17A of the Exchange Act and the regulations of the Securities and Exchange
Commission thereunder.
DEPOSITORY AGREEMENT: With respect to the Class of Book-Entry Notes,
the agreement among the Issuer, the Indenture Trustee and the initial
Depository, dated as of the Closing Date.
DEPOSITORY PARTICIPANT: A Person for whom, from time to time, the
Depository effects book- entry transfers and pledges of securities deposited
with the Depository.
DETERMINATION DATE: With respect to any Payment Date, the 15th of the
related month, or if the 15th day of such month is not a Business Day, the
immediately preceding Business Day.
DUE DATE: With respect to each Mortgage Loan, the day of the month on
which each scheduled Monthly Payment is due.
DUE PERIOD: With respect to any Payment Date and the Mortgage Loans,
the period commencing on the second day of the month immediately preceding the
month of such Payment
7
Date (or, with respect to the first Due Period, the day following the Cut-off
Date) and ending on the first day of the month of such Payment Date.
ELIGIBLE ACCOUNT: An account that is any of the following: (i) a
segregated account maintained with a federal or state chartered depository
institution (A) the short-term obligations of which are rated A-1+ or better by
Standard & Poor's and P-1 by Xxxxx'x at the time of any deposit therein or (B)
fully insured to the limits established by the FDIC, PROVIDED that any deposits
not so insured shall, to the extent acceptable to the Rating Agency, as
evidenced in writing, be maintained such that (as evidenced by an Opinion of
Counsel delivered to the Indenture Trustee and the Rating Agency) the Indenture
Trustee has a claim with respect to the funds in such account or a perfected
first security interest against any collateral (which shall be limited to
Eligible Investments) securing such funds that is superior to claims of any
other depositors or creditors of the depository institution with which such
account is maintained, (ii) a segregated trust account or accounts maintained
with a federal or state chartered depository institution or trust company
subject to regulations regarding fiduciary funds on deposit similar to Title 12
of the Code of Federal Regulations Section 9.10(b), which, in either case, has
corporate trust powers, acting in its fiduciary capacity, or (iii) in the case
of the Collection Account or Servicing Account, either (A) a trust account or
accounts maintained at the corporate trust department of the Indenture Trustee
or (B) an account or accounts maintained at the corporate trust department of
the Master Servicer (or an affiliate thereof), as long as their short term debt
obligations are rated F-1 by Fitch Ratings, P-1 by Xxxxx'x and A-1 by Standard &
Poor's or better and their long term debt obligations are rated A by Fitch
Ratings, A2 by Xxxxx'x and A by Standard & Poor's or better, or (iv) an account
or accounts of a depository institution acceptable to the Rating Agency as
evidenced in writing by the Rating Agency that use of any such account as the
Collection Account or the Payment Account will not reduce the rating assigned to
any of the Securities by such Rating Agency below investment grade.
ELIGIBLE INVESTMENTS: One or more of the following:
(i) obligations of or guaranteed as to principal and
interest by the United States or any agency or instrumentality thereof
when such obligations are backed by the full faith and credit of the
United States;
(ii) repurchase agreements on obligations specified
in clause (i) maturing not more than one month from the date of
acquisition thereof, provided that the unsecured obligations of the
party agreeing to repurchase such obligations are at the time rated by
the Rating Agency in its highest short-term rating available;
(iii) federal funds, certificates of deposit, demand
deposits, time deposits and bankers' acceptances (which shall each have
an original maturity of not more than 90 days and, in the case of
bankers' acceptances, shall in no event have an original maturity of
more than 365 days or a remaining maturity of more than 30 days)
denominated in United States dollars of any U.S. depository institution
or trust company incorporated under the laws of the United States or
any state thereof or of any domestic branch of a foreign depository
institution or trust company; provided that the debt obligations of
such depository institution or trust company (or, if the only Rating
Agency is Standard & Poor's, in the case of the principal depository
institution in a depository institution holding company, debt
obligations
8
of the depository institution holding company) at the date of
acquisition thereof have been rated by the Rating Agency in its highest
short-term rating available; and provided further that, if the only
Rating Agency is Standard & Poor's and if the depository or trust
company is a principal subsidiary of a bank holding company and the
debt obligations of such subsidiary are not separately rated, the
applicable rating shall be that of the bank holding company; and,
provided further that, if the original maturity of such short-term
obligations of a domestic branch of a foreign depository institution or
trust company shall exceed 30 days, the short-term rating of such
institution shall be A-1+ in the case of Standard & Poor's if Standard
& Poor's is the Rating Agency;
(iv) commercial paper (having original maturities of
not more than 365 days) of any corporation incorporated under the laws
of the United States or any state thereof which on the date of
acquisition has been rated by Xxxxx'x and Standard & Poor's in their
highest short-term ratings available; provided that such commercial
paper shall have a remaining maturity of not more than 30 days;
(v) a money market fund or a qualified investment
fund rated by Xxxxx'x in its highest long-term ratings available and
rated AAAm or AAAm-G by Standard & Poor's, including any such funds for
which Xxxxx Fargo Bank, National Association (or any successor
Indenture Trustee) or any affiliate thereof serves as an investment
advisor, manager, administrator, shareholder, servicing agent, and/or
custodian or sub-custodian; and
(vi) other obligations or securities that are
acceptable to each Rating Agency as a Permitted Investment hereunder
and will not reduce the rating assigned to any Class of Notes by such
Rating Agency below the lower of the then-current rating or the rating
assigned to such Notes as of the Closing Date by such Rating Agency, as
evidenced in writing; and
(vii) any investment approved in writing by each of
the Rating Agencies.
The Indenture Trustee may purchase from or sell to itself or an affiliate, as
principal or agent, the Eligible Investments listed above.
PROVIDED, HOWEVER, that no instrument shall be an Eligible Investment if it
represents, either (1) the right to receive only interest payments with respect
to the underlying debt instrument or (2) the right to receive both principal and
interest payments derived from obligations underlying such instrument and the
principal and interest payments with respect to such instrument provide a yield
to maturity greater than 120% of the yield to maturity at par of such underlying
obligations.
ELIGIBLE SUBSTITUTE MORTGAGE LOAN: A Mortgage Loan substituted by the
Seller for a Deleted Mortgage Loan which must, on the date of such substitution,
as confirmed in an Officer's Certificate delivered to the Indenture Trustee, (i)
have an outstanding principal balance, after deduction of the principal portion
of the monthly payment due in the month of substitution (or in the case of a
substitution of more than one Mortgage Loan for a Deleted Mortgage Loan, an
aggregate outstanding principal balance, after such deduction), not in excess of
the outstanding principal balance of the Deleted Mortgage Loan (the amount of
any shortfall to be deposited by the Seller in the Collection
9
Account in the month of substitution); (ii) comply with each non-statistical
representation and warranty set forth in Section 3.1(b) of the Mortgage Loan
Purchase Agreement as of the date of substitution; (iii) have a Mortgage Rate no
lower than and not more than 1% per annum higher than the Mortgage Rate of the
Deleted Mortgage Loan as of the date of substitution; (iv) have a Loan-to- Value
Ratio at the time of substitution no higher than that of the Deleted Mortgage
Loan at the time of substitution; (v) have a remaining term to stated maturity
not greater than (and not more than one year less than) that of the Deleted
Mortgage Loan; (vi) not be 30 days or more delinquent; (vii) be an
adjustable-rate first lien mortgage loan, if being substituted for an ARM Loan;
and (viii) be a fixed-rate first xxxx xxxx mortgage loan, if being substituted
for a Fixed Rate Loan.
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
EVENT OF DEFAULT: With respect to the Indenture, any one of the
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body):
(i) a failure by the Issuer to pay (a) Accrued Note
Interest on any Class of Notes or the Principal Distribution Amount
with respect to a Payment Date on such Payment Date or (b) the Unpaid
Interest Shortfall with respect to any Class of Notes, but only, with
respect to clause (b), to the extent funds are available to make such
payment as provided in the Indenture; or
(ii) the failure by the Issuer on the Final Scheduled
Payment Date to reduce the Note Principal Balance of any of the Class A
Notes or the Class M Notes to zero; or
(iii) there occurs a default in the observance or
performance of any covenant or agreement of the Issuer made in the
Indenture, or any representation or warranty of the Issuer made in the
Indenture or in any certificate or other writing delivered pursuant
hereto or in connection herewith proving to have been incorrect in any
material respect as of the time when the same shall have been made, and
such default shall continue or not be cured, or the circumstance or
condition in respect of which such representation or warranty was
incorrect shall not have been eliminated or otherwise cured, for a
period of 30 days after there shall have been given, by registered or
certified mail, to the Issuer by the Indenture Trustee, the Holders of
at least 25% of the aggregate Note Principal Balance of the Outstanding
Notes, a written notice specifying such default or incorrect
representation or warranty and requiring it to be remedied and stating
that such notice is a notice of default hereunder; or
(iv) there occurs the filing of a decree or order for
relief by a court having jurisdiction in the premises in respect of the
Issuer or any substantial part of the Trust Estate in an involuntary
case under any applicable federal or state bankruptcy, insolvency or
other similar law now or hereafter in effect, or appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar
official of the Issuer or for any substantial part of
10
the Trust Estate, or ordering the winding-up or liquidation of the
Issuer's affairs, and such decree or order shall remain unstayed and in
effect for a period of 60 consecutive days; or
(v) there occurs the commencement by the Issuer of a
voluntary case under any applicable federal or state bankruptcy,
insolvency or other similar law now or hereafter in effect, or the
consent by the Issuer to the entry of an order for relief in an
involuntary case under any such law, or the consent by the Issuer to
the appointment or taking possession by a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar official of the
Issuer or for any substantial part of the assets of the Trust Estate,
or the making by the Issuer of any general assignment for the benefit
of creditors, or the failure by the Issuer generally to pay its debts
as such debts become due, or the taking of any action by the Issuer in
furtherance of any of the foregoing.
EVENT OF SERVICER TERMINATION: With respect to the Servicing Agreement,
a Servicing Default as defined in Section 6.01 of the Servicing Agreement.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.
EXPENSES: The meaning specified in Section 7.02 of the Trust Agreement.
XXXXXX XXX: Xxxxxx Xxx (formerly, the Federal National Mortgage
Association), or any successor thereto.
FDIC: The Federal Deposit Insurance Corporation or any successor
thereto.
FINAL CERTIFICATION: The final certification delivered by the Custodian
pursuant to Section 2.03(b) of the Custodial Agreement and in the form attached
as Exhibit Two thereto.
FINAL SCHEDULED PAYMENT DATE: With respect to each Class of Notes, the
Payment Date in April 2044.
FITCH RATINGS: Fitch, Inc., or its successor in interest.
FIXED RATE LOANS: At any time, collectively, all the Mortgage Loans
which have fixed Mortgage Rates.
FORECLOSURE PROFIT: With respect to a Liquidated Mortgage Loan, the
amount, if any, by which (i) the aggregate of its Net Liquidation Proceeds
exceeds (ii) the related Stated Principal Balance (plus accrued and unpaid
interest thereon at the applicable Mortgage Rate from the date interest was last
paid through the date of receipt of the final Liquidation Proceeds) of such
Liquidated Mortgage Loan immediately prior to the final recovery of its
Liquidation Proceeds.
FREDDIE MAC: Freddie Mac, or any successor thereto.
11
GRANT: Pledge, bargain, sell, warrant, alienate, remise, release,
convey, assign, transfer, create, and xxxxx x xxxx upon and a security interest
in and right of set-off against, deposit, set over and confirm pursuant to the
Indenture. A Grant of the Collateral or of any other agreement or instrument
shall include all rights, powers and options (but none of the obligations) of
the granting party thereunder, including the immediate and continuing right to
claim for, collect, receive and give receipt for principal and interest payments
in respect of such collateral or other agreement or instrument and all other
moneys payable thereunder, to give and receive notices and other communications,
to make waivers or other agreements, to exercise all rights and options, to
bring proceedings in the name of the granting party or otherwise, and generally
to do and receive anything that the granting party is or may be entitled to do
or receive thereunder or with respect thereto.
GROSS MARGIN: With respect to any ARM Loan, the percentage set forth as
the "Gross Margin" for such Mortgage Loan on the Mortgage Loan Schedule, as
adjusted from time to time in accordance with the terms of the Servicing
Agreement.
GROUP I AVAILABLE FUNDS: With respect to any Payment Date, the sum of
the following, in each case with respect to the Group I Loans:
(i) each previously undistributed Monthly Payment due
after the Cut-off Date received on or prior to the related
Determination Date or advanced prior to such Payment Date (other than
Monthly Payments due after the related Due Period, which shall be
treated as if received during the Due Period they were due and other
than Monthly Payments with respect to which the Master Servicer has
made an unreimbursed Advance) on each outstanding Group I Loan (less
the related Master Servicing Fees and any fees or penalties retained by
the Master Servicer);
(ii) all proceeds of any Group I Loan repurchased
during the related Prepayment Period (or deemed to have been so
repurchased in accordance with the Servicing Agreement) pursuant to the
Servicing Agreement and the amount of any shortfall deposited in the
Collection Account in connection with the substitution of a Deleted
Mortgage Loan pursuant to the Mortgage Loan Purchase Agreement, during
the related Prepayment Period;
(iii) all other unscheduled collections (including,
without limitation, Principal Prepayments, Insurance Proceeds,
Liquidation Proceeds and REO Proceeds) received during the related
Prepayment Period to the extent applied by the Master Servicer as
recoveries of principal or interest of the related Group I Loan
pursuant to the Servicing Agreement;
(iv) any (i) Compensating Interest payments and (ii)
Foreclosure Profits, to the extent not payable to the Subservicers; and
MINUS
(v) expenses incurred by and reimbursable to the
Master Servicer or the Depositor pursuant to the Servicing Agreement or
otherwise, or in connection with enforcing
12
any repurchase, substitution or indemnification obligation of the
Seller in respect of a Group I Loan;
(vi) amounts expended by the Master Servicer (a)
pursuant to the Servicing Agreement in good faith in connection with
the restoration of property related to a Group I Loan damaged by an
Uninsured Cause, and (b) in connection with the liquidation of a
Mortgage Loan or disposition of an REO Property related to a Group I
Loan to the extent not otherwise reimbursed to the Master Servicer
pursuant to the Servicing Agreement;
(vii) if the Notes have been declared due and payable
following an Event of Default on such Payment Date, any amounts owed to
the Indenture Trustee by the Issuer pursuant to Section 6.07 of the
Indenture;
(viii) any other amounts withdrawn from the
Collection Account by the Master Servicer pursuant to Section
3.07(a)(ii) through (xi) of the Servicing Agreement, not described
above in clauses (v) through (vii) above; and
(ix) any other costs, expenses and amounts payable or
reimbursable to the Indenture Trustee (including in its various
capacities as Certificate Paying Agent, Certificate Registrar, Note
Registrar and Paying Agent), the Owner Trustee and/or the Custodian as
provided in any of the Basic Documents and relating to the Group I
Loans or, if such costs, expenses or other amounts are not exclusively
related to the Group I Loans, then Loan Group I's pro rata share (based
on the percentage of the aggregate Note Principal Balance of the Group
I Notes to the aggregate Note Principal Balance of all of the Notes) of
such costs, expenses and other amounts.
GROUP I NOTE: A Class I-A, Class I-M-1, Class I-M-2 or Class I-M-3
Note.
GROUP I CUT-OFF DATE BALANCE: The aggregate Stated Principal Balance of
the Group I Mortgage Loans as of the Cut-off Date.
GROUP I LOAN: A Mortgage Loan in Loan Group I.
GROUP I OVERCOLLATERALIZATION TARGET AMOUNT: With respect to any
Payment Date, 0.50% of the Group I Cut-off Date Balance.
GROUP II AVAILABLE FUNDS: With respect to any Payment Date, the sum of
the following, in each case with respect to the Group II Loans:
(i) each previously undistributed Monthly Payment due
after the Cut-off Date received on or prior to the related
Determination Date or advanced prior to such Payment Date (other than
Monthly Payments due after the related Due Period, which shall be
treated as if received during the Due Period they were due and other
than Monthly Payments with respect to which the Master Servicer has
made an unreimbursed Advance) on each outstanding Group II Loan (less
the related Master Servicing Fees and any fees or penalties retained by
the Master Servicer);
13
(ii) all proceeds of any Group II Loan repurchased
during the related Prepayment Period (or deemed to have been so
repurchased in accordance with the Servicing Agreement) pursuant to the
Servicing Agreement and the amount of any shortfall deposited in the
Collection Account in connection with the substitution of a Deleted
Mortgage Loan pursuant to the Mortgage Loan Purchase Agreement, during
the related Prepayment Period;
(iii) all other unscheduled collections (including,
without limitation, Principal Prepayments, Insurance Proceeds,
Liquidation Proceeds and REO Proceeds) received during the related
Prepayment Period to the extent applied by the Master Servicer as
recoveries of principal or interest of the related Group II Loan
pursuant to the Servicing Agreement;
(iv) any (i) Compensating Interest payments and (ii)
Foreclosure Profits, to the extent not payable to the Subservicers; and
MINUS
(v) expenses incurred by and reimbursable to the
Master Servicer or the Depositor pursuant to the Servicing Agreement or
otherwise, or in connection with enforcing any repurchase, substitution
or indemnification obligation of the Seller in respect of a Group II
Loan;
(vi) amounts expended by the Master Servicer (a)
pursuant to the Servicing Agreement in good faith in connection with
the restoration of property related to a Group II Loan damaged by an
Uninsured Cause, and (b) in connection with the liquidation of a
Mortgage Loan or disposition of an REO Property related to a Group II
Loan to the extent not otherwise reimbursed to the Master Servicer
pursuant to the Servicing Agreement;
(vii) if the Notes have been declared due and payable
following an Event of Default on such Payment Date, any amounts owed to
the Indenture Trustee by the Issuer pursuant to Section 6.07 of the
Indenture;
(viii) any other amounts withdrawn from the
Collection Account by the Master Servicer pursuant to Section
3.07(a)(ii) through (xi) of the Servicing Agreement, not described
above in clauses (v) through (vii) above; and
(ix) any other costs, expenses and amounts payable or
reimbursable to the Indenture Trustee (including in its various
capacities as Certificate Paying Agent, Certificate Registrar, Note
Registrar and Paying Agent), the Owner Trustee and/or the Custodian as
provided in any of the Basic Documents and relating to the Group II
Loans or, if such costs, expenses or other amounts are not exclusively
related to the Group II Loans, then Loan Group II's pro rata share
(based on the percentage of the aggregate Note Principal Balance of the
Group II Notes to the aggregate Note Principal Balance of all of the
Notes) of such costs, expenses and other amounts.
GROUP II NOTE: A Class II-A, Class II-M-1, Class II-M-2 or Class II-M-3
Note.
14
GROUP II CUT-OFF DATE BALANCE: The aggregate Stated Principal Balance
of the Group II Mortgage Loans as of the Cut-off Date.
GROUP II LOAN: A Mortgage Loan in Loan Group II.
GROUP II OVERCOLLATERALIZATION TARGET AMOUNT: With respect to any
Payment Date, 0.50% of the Group II Cut-off Date Balance.
GROUP III AVAILABLE FUNDS: With respect to any Payment Date, the sum of
the following, in each case with respect to the Group III Loans:
(i) each previously undistributed Monthly Payment due
after the Cut-off Date received on or prior to the related
Determination Date or advanced prior to such Payment Date (other than
Monthly Payments due after the related Due Period, which shall be
treated as if received during the Due Period they were due and other
than Monthly Payments with respect to which the Master Servicer has
made an unreimbursed Advance) on each outstanding Group III Loan (less
the related Master Servicing Fees and any fees or penalties retained by
the Master Servicer);
(ii) all proceeds of any Group III Loan repurchased
during the related Prepayment Period (or deemed to have been so
repurchased in accordance with the Servicing Agreement) pursuant to the
Servicing Agreement and the amount of any shortfall deposited in the
Collection Account in connection with the substitution of a Deleted
Mortgage Loan pursuant to the Mortgage Loan Purchase Agreement, during
the related Prepayment Period;
(iii) all other unscheduled collections (including,
without limitation, Principal Prepayments, Insurance Proceeds,
Liquidation Proceeds and REO Proceeds) received during the related
Prepayment Period to the extent applied by the Master Servicer as
recoveries of principal or interest of the related Group III Loan
pursuant to the Servicing Agreement;
(iv) any (i) Compensating Interest payments and (ii)
Foreclosure Profits, to the extent not payable to the Subservicers; and
MINUS
(v) expenses incurred by and reimbursable to the
Master Servicer or the Depositor pursuant to the Servicing Agreement or
otherwise, or in connection with enforcing any repurchase, substitution
or indemnification obligation of the Seller in respect of a Group III
Loan;
(vi) amounts expended by the Master Servicer (a)
pursuant to the Servicing Agreement in good faith in connection with
the restoration of property related to a Group III Loan damaged by an
Uninsured Cause, and (b) in connection with the liquidation of a
15
Mortgage Loan or disposition of an REO Property related to a Group III
Loan to the extent not otherwise reimbursed to the Master Servicer
pursuant to the Servicing Agreement;
(vii) if the Notes have been declared due and payable
following an Event of Default on such Payment Date, any amounts owed to
the Indenture Trustee by the Issuer pursuant to Section 6.07 of the
Indenture;
(viii) any other amounts withdrawn from the
Collection Account by the Master Servicer pursuant to Section
3.07(a)(ii) through (xi) of the Servicing Agreement, not described
above in clauses (v) through (vii) above; and
(ix) any other costs, expenses and amounts payable or
reimbursable to the Indenture Trustee (including in its various
capacities as Certificate Paying Agent, Certificate Registrar, Note
Registrar and Paying Agent), the Owner Trustee and/or the Custodian as
provided in any of the Basic Documents and relating to the Group III
Loans or, if such costs, expenses or other amounts are not exclusively
related to the Group III Loans, then Loan Group III's pro rata share
(based on the percentage of the aggregate Note Principal Balance of the
Group III Notes to the aggregate Note Principal Balance of all of the
Notes) of such costs, expenses and other amounts.
GROUP III NOTE: A Class III-A, Class III-M-1 or Class III-M-2 Note.
GROUP III CUT-OFF DATE BALANCE: The aggregate Stated Principal Balance
of the Group III Mortgage Loans as of the Cut-off Date.
GROUP III LOAN: The Mortgage Loans in Loan Group III.
GROUP III OVERCOLLATERALIZATION TARGET AMOUNT: With respect to any
Payment Date, 0.50% of the Group III Cut-off Date Balance.
GROUP IV AVAILABLE FUNDS: With respect to any Payment Date, the sum of
the following, in each case with respect to the Group IV Loans:
(i) each previously undistributed Monthly Payment due
after the Cut-off Date received on or prior to the related
Determination Date or advanced prior to such Payment Date (other than
Monthly Payments due after the related Due Period, which shall be
treated as if received during the Due Period they were due and other
than Monthly Payments with respect to which the Master Servicer has
made an unreimbursed Advance) on each outstanding Group IV Loan (less
the related Master Servicing Fees and any fees or penalties retained by
the Master Servicer);
(ii) all proceeds of any Group IV Loan repurchased
during the related Prepayment Period (or deemed to have been so
repurchased in accordance with the Servicing Agreement) pursuant to the
Servicing Agreement and the amount of any shortfall deposited in the
Collection Account in connection with the substitution of a Deleted
Mortgage Loan pursuant to the Mortgage Loan Purchase Agreement, during
the related Prepayment Period;
16
(iii) all other unscheduled collections (including,
without limitation, Principal Prepayments, Insurance Proceeds,
Liquidation Proceeds and REO Proceeds) received during the related
Prepayment Period to the extent applied by the Master Servicer as
recoveries of principal or interest of the related Group IV Loan
pursuant to the Servicing Agreement;
(iv) any (i) Compensating Interest payments and (ii)
Foreclosure Profits, to the extent not payable to the Subservicers; and
MINUS
(v) expenses incurred by and reimbursable to the
Master Servicer or the Depositor pursuant to the Servicing Agreement or
otherwise, or in connection with enforcing any repurchase, substitution
or indemnification obligation of the Seller in respect of a Group IV
Loan;
(vi) amounts expended by the Master Servicer (a)
pursuant to the Servicing Agreement in good faith in connection with
the restoration of property related to a Group IV Loan damaged by an
Uninsured Cause, and (b) in connection with the liquidation of a
Mortgage Loan or disposition of an REO Property related to a Group IV
Loan to the extent not otherwise reimbursed to the Master Servicer
pursuant to the Servicing Agreement;
(vii) if the Notes have been declared due and payable
following an Event of Default on such Payment Date, any amounts owed to
the Indenture Trustee by the Issuer pursuant to Section 6.07 of the
Indenture;
(viii) any other amounts withdrawn from the
Collection Account by the Master Servicer pursuant to Section
3.07(a)(ii) through (xi) of the Servicing Agreement, not described
above in clauses (v) through (vii) above; and
(ix) any other costs, expenses and amounts payable or
reimbursable to the Indenture Trustee (including in its various
capacities as Certificate Paying Agent, Certificate Registrar, Note
Registrar and Paying Agent), the Owner Trustee and/or the Custodian as
provided in any of the Basic Documents and relating to the Group IV
Loans or, if such costs, expenses or other amounts are not exclusively
related to the Group IV Loans, then Loan Group IV's pro rata share
(based on the percentage of the aggregate Note Principal Balance of the
Group IV Notes to the aggregate Note Principal Balance of all of the
Notes) of such costs, expenses and other amounts.
GROUP IV NOTE: A Class IV-A, Class IV-M-1, Class IV-M-2 or Class IV-M-3
Note.
GROUP IV CUT-OFF DATE BALANCE: The aggregate Stated Principal Balance
of the Group IV Mortgage Loans as of the Cut-off Date.
GROUP IV LOAN: The Mortgage Loans in Loan Group IV.
17
GROUP IV OVERCOLLATERALIZATION TARGET AMOUNT: With respect to any
Payment Date, 0.50% of the Group IV Cut-off Date Balance.
HAZARDOUS MATERIALS: Any dangerous, toxic or hazardous pollutants,
chemicals, wastes, or substances, including, without limitation, those so
identified pursuant to the Comprehensive Environmental Response, Compensation
and Liability Act, 42 U.S.C. Section 9601 et seq., or any other environmental
laws now existing, and specifically including, without limitation, asbestos and
asbestos-containing materials, polychlorinated biphenyls, radon gas, petroleum
and petroleum products, urea formaldehyde and any substances classified as being
"in inventory", "usable work in progress" or similar classification which would,
if classified unusable, be included in the foregoing definition.
INDEMNIFIED PARTY: The meaning specified in Section 7.02 of the Trust
Agreement.
INDENTURE: The indenture dated as of March 31, 2004, between the Issuer
and the Indenture Trustee, relating to the American Home Mortgage Investment
Trust 2004-1 Notes.
INDENTURE TRUSTEE: Xxxxx Fargo Bank, National Association, and its
successors and assigns or any successor indenture trustee appointed pursuant to
the terms of the Indenture.
INDENTURE TRUSTEE FEE: All investment income and earnings on the funds
from time to time in the Payment Account and the Certificate Payment Account.
INDEPENDENT: When used with respect to any specified Person, the Person
(i) is in fact independent of the Issuer, any other obligor on the Notes, the
Seller, the Master Servicer, the Depositor and any Affiliate of any of the
foregoing Persons, (ii) does not have any direct financial interest or any
material indirect financial interest in the Issuer, any such other obligor, the
Seller, the Master Servicer, the Depositor or any Affiliate of any of the
foregoing Persons and (iii) is not connected with the Issuer, any such other
obligor, the Seller, the Master Servicer, the Depositor or any Affiliate of any
of the foregoing Persons as an officer, employee, promoter, underwriter,
trustee, partner, director or person performing similar functions.
INDEPENDENT CERTIFICATE: A certificate or opinion to be delivered to
the Indenture Trustee under the circumstances described in, and otherwise
complying with, the applicable requirements of Section 10.01 of the Indenture,
made by an independent appraiser or other expert appointed by an Issuer Request
and approved by the Indenture Trustee in the exercise of reasonable care, and
such opinion or certificate shall state that the signer has read the definition
of "Independent" in this Indenture and that the signer is Independent within the
meaning thereof.
INDEX: With respect to any Mortgage Loan, the index for the adjustment
of the Mortgage Rate set forth as such in the related Mortgage Note.
INITIAL NOTE PRINCIPAL BALANCE: With respect to the Class I-A Notes,
$203,101,000. With respect to the Class I-M-1 Notes, $13,619,000. With respect
to the Class I-M-2 Notes, $11,842,000. With respect to the Class I-M-3 Notes,
$7,106,500. With respect to the Class II-A Notes, $100,592,000. With respect to
the Class II-M-1 Notes, $8,647,000. With respect to the Class II-M-2
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Notes, $3,747,000. With respect to the Class II-M-3 Notes, $1,729,500. With
respect to the Class III-A Notes, $150,328,000. With respect to the Class
III-M-1 Notes, $7,235,000. With respect to the Class III-M-2 Notes, $2,412,500.
With respect to the Class IV-A Notes, $92,060,000. With respect to the Class
IV-M-1 Notes, $4,616,000. With respect to the Class IV-M-2 Notes, $3,334,000.
With respect to the Class IV-M-3 Notes, $2,052,000.
INITIAL CERTIFICATION: The initial certification delivered by the
Custodian pursuant to Section 2.03(a) of the Custodial Agreement and in the form
attached thereto as Exhibit One thereto.
INSURANCE PROCEEDS: Proceeds paid by any insurer pursuant to any
insurance policy covering a Mortgage Loan which are required to be remitted to
the Master Servicer, net of any component thereof (i) covering any expenses
incurred by or on behalf of the Master Servicer in connection with obtaining
such proceeds, (ii) that is applied to the restoration or repair of the related
Mortgaged Property or (iii) released to the Mortgagor in accordance with the
Master Servicer's normal servicing procedures.
INTEREST DETERMINATION DATE: With respect to each Class of LIBOR Notes
and (a) the first Accrual Period, the second LIBOR Business Day preceding the
Closing Date, and (b) each Accrual Period thereafter, the second LIBOR Business
Day preceding the related Payment Date on which such Accrual Period commences.
INTEREST RATE ADJUSTMENT DATE: With respect to each Mortgage Loan, the
date or dates on which the Mortgage Rate is adjusted in accordance with the
related Mortgage Note.
INTERESTED PERSON: As of any date of determination, the Depositor, the
Master Servicer, the Indenture Trustee, any Mortgagor, or any Person actually
known to a Responsible Officer of the Trustee to be an Affiliate of any of them.
INVESTMENT COMPANY ACT: The Investment Company Act of 1940, as amended,
and any amendments thereto.
IRS: The Internal Revenue Service.
ISSUER: American Home Mortgage Investment Trust 2004-1, a Delaware
statutory trust, or its successor in interest.
ISSUER REQUEST: A written order or request signed in the name of the
Issuer by any one of its Authorized Officers and delivered to the Indenture
Trustee.
LIBOR BUSINESS DAY: A day on which banks are open for dealing in
foreign currency and exchange in London and New York City.
LIBOR NOTE: A Group I Note, or any Group II, Group III or Group IV Note
after the related Note Rate Change Date.
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LIEN: Any mortgage, deed of trust, pledge, conveyance, hypothecation,
assignment, participation, deposit arrangement, encumbrance, lien (statutory or
other), preference, priority right or interest or other security agreement or
preferential arrangement of any kind or nature whatsoever, including, without
limitation, any conditional sale or other title retention agreement, any
financing lease having substantially the same economic effect as any of the
foregoing and the filing of any financing statement under the UCC (other than
any such financing statement filed for informational purposes only) or
comparable law of any jurisdiction to evidence any of the foregoing; PROVIDED,
HOWEVER, that any assignment pursuant to Section 6.02 of the Servicing Agreement
shall not be deemed to constitute a Lien.
LIFETIME RATE CAP: With respect to each Mortgage Loan with respect to
which the related Mortgage Note provides for a lifetime rate cap, the maximum
Mortgage Rate permitted over the life of such Mortgage Loan under the terms of
such Mortgage Note, as set forth in the Mortgage Loan Schedule.
LIQUIDATED MORTGAGE LOAN: With respect to any Payment Date, any
Mortgage Loan in respect of which the Master Servicer has determined, in
accordance with the servicing procedures specified in the Servicing Agreement,
as of the end of the related Due Period that substantially all Liquidation
Proceeds which it reasonably expects to recover with respect to the disposition
of the related Mortgaged Property or REO Property have been recovered.
LIQUIDATION EXPENSES: Out-of-pocket expenses (exclusive of overhead)
which are incurred by or on behalf of the Master Servicer, in connection with
the liquidation of any Mortgage Loan and not recovered under any insurance
policy, such expenses including, without limitation, legal fees and expenses,
any unreimbursed amount expended respecting the related Mortgage Loan and any
related and unreimbursed expenditures for real estate property taxes or for
property restoration, preservation or insurance against casualty loss or damage.
LIQUIDATION PROCEEDS: Proceeds (including Insurance Proceeds) received
in connection with the liquidation of any Mortgage Loan or related REO Property,
whether through trustee's sale, foreclosure sale or otherwise.
LOAN GROUP: Any of Loan Group I, Loan Group II, Loan Group III or Loan
Group IV.
LOAN GROUP I: The Group I Loans.
LOAN GROUP II: The Group II Loans.
LOAN GROUP III: The Group III Loans.
LOAN-TO-VALUE RATIO: With respect to any Mortgage Loan, as of any date
of determination, a fraction expressed as a percentage, the numerator of which
is the then current principal amount of the Mortgage Loan, and the denominator
of which is the Appraised Value of the related Mortgaged Property.
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LOAN YEAR: With respect to any Mortgage Loan, the one-year period
commencing on the day succeeding the origination of such Mortgage Loan and
ending on the anniversary date of such Mortgage Loan, and each annual period
thereafter.
LOST NOTE AFFIDAVIT: With respect to any Mortgage Loan as to which the
original Mortgage Note has been lost or destroyed and has not been replaced, an
affidavit from the Seller certifying that the original Mortgage Note has been
lost, misplaced or destroyed (together with a copy of the related Mortgage
Note).
MAJORITY CERTIFICATEHOLDER: A Holder of a 50.01% or greater Certificate
Percentage Interest of the Certificates.
MASTER SERVICER: Columbia National, Incorporated, a Maryland
corporation, and its successors and assigns.
MASTER SERVICER REMITTANCE DATE: The eighteenth (18th) calendar day of
each month or, if such eighteenth (18th) day is not a Business Day, then the
Business Day immediately preceding such eighteenth (18th) day of the month.
MASTER SERVICING FEE: With respect to each Mortgage Loan and any
Payment Date, the fee payable monthly to the Master Servicer in respect of
master servicing compensation that accrues at an annual rate equal to the Master
Servicing Fee Rate multiplied by the Stated Principal Balance of such Mortgage
Loan as of the related Due Date in the related Due Period.
MASTER SERVICING FEE RATE: With respect to any Mortgage Loan, 0.375%
per annum.
MAXIMUM NOTE RATE: With respect to each Class of the Group I, Group II,
Group III and Group IV Notes, 11.25%, 10.50%, 9.75% and 11.00% per annum,
respectively.
MAXIMUM MORTGAGE RATE: With respect to each ARM Loan, the maximum
Mortgage Rate.
MERS: Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or any successor
thereto.
MERS(R) SYSTEM: The system of recording transfers of Mortgages
electronically maintained by MERS.
MIN: The Mortgage Identification Number for Mortgage Loans registered
with MERS on the MERS(R) System.
MINIMUM MORTGAGE RATE: With respect to each ARM Loan, the minimum
Mortgage Rate.
MOM LOAN: With respect to any Mortgage Loan, MERS acting as the
mortgagee of such Mortgage Loan, solely as nominee for the originator of such
Mortgage Loan and its successors and assigns, at the origination thereof.
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MONTHLY PAYMENT: With respect to any Mortgage Loan (including any REO
Property) and any Due Date, the payment of principal and interest due thereon in
accordance with the amortization schedule at the time applicable thereto (after
adjustment, if any, for partial Principal Prepayments and for Deficient
Valuations occurring prior to such Due Date but before any adjustment to such
amortization schedule by reason of any bankruptcy, other than a Deficient
Valuation, or similar proceeding or any moratorium or similar waiver or grace
period).
MOODY'S: Xxxxx'x Investors Service, Inc. or its successor in interest.
MORTGAGE: The mortgage, deed of trust or other instrument creating a
first lien on an estate in fee simple interest in real property securing a
Mortgage Loan.
MORTGAGE FILE: The file containing the Related Documents pertaining to
a particular Mortgage Loan and any additional documents required to be added to
the Mortgage File pursuant to the Mortgage Loan Purchase Agreement or the
Servicing Agreement.
MORTGAGE LOANS: The Mortgage Loans that will be transferred and
assigned to the Trust pursuant to Section 2.03(a) of the Indenture, each
Mortgage Loan so held being identified in the Mortgage Loan Schedule. The
Mortgage Loans have been divided into four groups, Loan Group I, Loan Group II,
Loan Group III and Loan Group IV.
MORTGAGE LOAN PURCHASE AGREEMENT: The Mortgage Loan Purchase Agreement,
dated as of the Closing Date, between the Seller, as seller, and the Purchaser,
as purchaser, relating to the sale, transfer and assignment of the Mortgage
Loans.
MORTGAGE LOAN SCHEDULE: With respect to any date, the schedule of
Mortgage Loans held by the Issuer on such date. The schedule of Mortgage Loans
as of the Cut-off Date is the schedule set forth in Exhibit B of the Indenture,
which schedule sets forth as to each Mortgage Loan:
(i) the loan number and name of the Mortgagor;
(ii) the street address, city, state and zip code of
the Mortgaged Property;
(iii) the original Mortgage Rate;
(iv) the maturity date;
(v) the original principal balance;
(vi) the first payment date;
(vii) the type of Mortgaged Property;
(viii) the Monthly Payment in effect as of the
Cut-off Date;
(ix) the Cut-off Date Principal Balance;
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(x) the Index and the Gross Margin, if applicable;
(xi) the Adjustment Date frequency and payment date
frequency, if applicable;
(xii) the occupancy status;
(xiii) the purpose of the Mortgage Loan;
(xiv) the Appraised Value of the Mortgaged Property;
(xv) the original term to maturity;
(xvi) the paid-through date of the Mortgage Loan;
(xvii) the Loan-to-Value Ratio;
(xviii) whether or not the Mortgage Loan was
underwritten pursuant to a limited documentation program;
(xix) the Loan Group; and
(xx) whether the Mortgage Loan has a fixed interest
rate or an adjustable interest rate.
The Mortgage Loan Schedule shall also set forth the total of the
amounts described under (ix) above for all of the Mortgage Loans.
MORTGAGE NOTE: The note or other evidence of the indebtedness of a
Mortgagor under a Mortgage Loan.
MORTGAGE RATE: With respect to any Mortgage Loan, the annual rate at
which interest accrues on such Mortgage Loan.
MORTGAGED PROPERTY: The underlying property, including real property
and improvements thereon, securing a Mortgage Loan.
MORTGAGOR: The obligor or obligors under a Mortgage Note.
NET COLLECTIONS: With respect to any Liquidated Mortgage Loan, an
amount equal to all payments on account of interest and principal on such
Mortgage Loan.
NET LIQUIDATION PROCEEDS: With respect to any Liquidated Mortgage Loan,
Liquidation Proceeds and Subsequent Recoveries net of unreimbursed advances by
the Master Servicer, Monthly Advances, expenses incurred by the Master Servicer
in connection with the liquidation of such
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Mortgage Loan and the related Mortgaged Property, and any other amounts payable
to the Master Servicer under the Servicing Agreement.
NET MONTHLY EXCESS CASHFLOW: For any Payment Date and any Loan Group,
the excess of (x) the related Available Funds for such Payment Date over (y) the
sum for such Payment Date of (A) the aggregate amount of Accrued Note Interest
for the related Notes and (B) the related Principal Remittance Amount used to
make payments in respect of principal to the related Notes.
NET MORTGAGE RATE: On any Mortgage Loan, the then applicable mortgage
rate thereon minus the Master Servicing Fee Rate.
NET WAC SHORTFALL: With respect to any Group II, Group III or Group IV
Notes, on or prior to the related Note Rate Change Date, the excess, if any, of
(x) the Accrued Note Interest thereon for such Payment Date calculated pursuant
to clause (i)(a) of the definition of Note Interest Rate over (y) Accrued Note
Interest thereon for such Payment Date calculated at the related Available Funds
Rate.
NET WAC SHORTFALL CARRY-FORWARD AMOUNT: With respect to each class of
Notes, other than the LIBOR Notes and any Payment Date, on or prior to the
related Note Rate Change Date, as determined separately for each such class of
Notes, an amount equal to the aggregate amount of Net WAC Shortfall for such
Notes on such Payment Date, plus any unpaid Net WAC Shortfall for such class of
Notes from prior Payment Dates, plus interest thereon at the Note Interest Rate
for such Payment Date for such class for the related Accrual Period, to the
extent previously unreimbursed by the related Net Monthly Excess Cashflow.
NONRECOVERABLE ADVANCE: Any advance (i) which was previously made or is
proposed to be made by the Master Servicer; and (ii) which, in the good faith
judgment of the Master Servicer, will not or, in the case of a proposed advance,
would not, be ultimately recoverable by the Master Servicer from Liquidation
Proceeds, Insurance Proceeds or future payments on any Mortgage Loan. The
Indenture Trustee may conclusively rely on any determination of
nonrecoverability made by the Master Servicer.
NOTE: A Group I Note, Group II Note, Group III Note or Group IV Note.
NOTE INTEREST RATE: With respect to each Payment Date and each class of
Group I Notes, a floating rate equal to the least of (i) One-Month LIBOR plus
the related Note Margin, (ii) the related Maximum Note Interest Rate and (iii)
the related Available Funds Rate with respect to such Payment Date. With respect
to each Payment Date and each class of Group II, Group III and Group IV Notes,
the least of (i)(a) prior to the related Note Rate Change Date, the fixed rate
set forth on page S-5 of the Prospectus and (b) on or after the related Note
Rate Change Date, a rate equal to Six-Month LIBOR, in the case of the Group II
Notes and Group IV Notes, or One-Year LIBOR, in the case of the Group III Notes,
plus the related Note Margin, (ii) the related Maximum Note Interest Rate and
(iii) the related Available Funds Rate.
NOTE MARGIN: With respect to the Class I-A Notes, on any Payment Date
prior to the Step-Up Date, 0.35% per annum, and on any Payment Date on and after
the Step-Up Date, 0.70% per annum.
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With respect to the Class I-M-1 Notes, on any Payment Date prior to the Step-Up
Date, 0.60% per annum, and on any Payment Date on and after the Step-Up Date,
0.90% per annum. With respect to the Class I-M-2 Notes, on any Payment Date
prior to the Step-Up Date, 1.25% per annum, and on any Payment Date on and after
the Step-Up Date, 1.875% per annum. With respect to the Class I-M-3 Notes, on
any Payment Date prior to the Step-Up Date, 2.00% per annum, and on any Payment
Date on and after the Step-Up Date, 3.00% per annum. With respect to the Group
II Notes and Group IV Notes, 2.00% per annum. With respect to the Group III
Notes, 1.35% per annum.
NOTE OWNER: The Beneficial Owner of a Note.
NOTE PRINCIPAL BALANCE: With respect to any Note as of any date of
determination, the initial Note Principal Balance as stated on the face thereof,
minus all amounts distributed in respect of principal with respect to such Note
and (a) plus, in the case of the Class M Notes, any Subsequent Recoveries
allocated thereto and (b) minus, in the case of the Class M Notes, the aggregate
amount of any reductions in the Note Principal Balance thereof deemed to have
occurred in connection with allocations of Realized Losses on all prior Payment
Dates in accordance with Section 3.29 of the Indenture.
NOTE RATE CHANGE DATE: With respect to the Group II Notes, the Payment
Date in February 1, 2007. With respect to the Group III Notes, the Payment Date
in March 1, 2009. With respect to the Group IV Notes, the Payment Date in March
1, 2009.
NOTE REGISTER: The register maintained by the Note Registrar in which
the Note Registrar shall provide for the registration of Notes and of transfers
and exchanges of Notes.
NOTE REGISTRAR: The Indenture Trustee, in its capacity as Note
Registrar, or any successor to the Indenture Trustee in such capacity.
NOTEHOLDER OR HOLDER: The Person in whose name a Note is registered in
the Note Register, except that, any Note registered in the name of the
Depositor, the Issuer, the Indenture Trustee, the Seller or the Master Servicer
or any Affiliate of any of them shall be deemed not to be a holder or holders,
nor shall any so owned be considered outstanding, for purposes of giving any
request, demand, authorization, direction, notice, consent or waiver under the
Indenture or the Trust Agreement; provided that, in determining whether the
Indenture Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Notes that a
Responsible Officer of the Indenture Trustee or the Owner Trustee actually knows
to be so owned shall be so disregarded. Owners of Notes that have been pledged
in good faith may be regarded as Holders if the pledgee establishes to the
satisfaction of the Indenture Trustee or the Owner Trustee the pledgee's right
so to act with respect to such Notes and that the pledgee is not the Issuer, any
other obligor upon the Notes or any Affiliate of any of the foregoing Persons.
OFFICER'S CERTIFICATE: With respect to the Master Servicer, a
certificate signed by the President, Managing Director, a Director, a Vice
President or an Assistant Vice President, of the Master Servicer and delivered
to the Indenture Trustee. With respect to the Issuer, a certificate signed by
any Authorized Officer of the Issuer, under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 10.01 of the
Indenture, and delivered to the
25
Indenture Trustee. Unless otherwise specified, any reference in the Indenture to
an Officer's Certificate shall be to an Officer's Certificate of any Authorized
Officer of the Issuer.
ONE-MONTH LIBOR: With respect to any Accrual Period, the rate
determined by the Indenture Trustee on the related Interest Determination Date
on the basis of the London interbank offered rate for one-month United States
dollar deposits, as such rates appear on the Telerate Screen Page 3750, as of
11:00 a.m. (London time) on such Interest Determination Date.
In the event that on any Interest Determination Date, Telerate Screen
3750 fails to indicate the London interbank offered rate for one-month United
States dollar deposits, then One-Month LIBOR for the related Accrual Period will
be established by the Indenture Trustee as follows:
(i) If on such Interest Determination Date two or
more Reference Banks provide such offered quotations, One-Month LIBOR
for the related Accrual Period shall be the arithmetic mean of such
offered quotations (rounded upwards if necessary to the nearest whole
multiple of 1/16%).
(ii) If on such Interest Determination Date fewer
than two Reference Banks provide such offered quotations, One-Month
LIBOR for the related Accrual Period shall be the higher of (i)
One-Month LIBOR as determined on the previous Interest Determination
Date and (ii) the Reserve Interest Rate.
(iii) If no such quotations can be obtained and no
Reference Bank rate is available, One-Year LIBOR will be the One-Year
LIBOR rate applicable to the preceding Accrual Period.
The establishment of One-Month LIBOR on each Interest Determination
Date by the Indenture Trustee and the Indenture Trustee's calculation of the
applicable Note Interest Rate applicable for the related Accrual Period shall
(in the absence of manifest error) be final and binding.
ONE-YEAR LIBOR: With respect to any Accrual Period, the rate determined
by the Indenture Trustee on the related Interest Determination Date on the basis
of the London interbank offered rate for one-year United States dollar deposits,
as such rates appear on the Telerate Screen Page 3750, as of 11:00 a.m. (London
time) on such Interest Determination Date.
In the event that on any Interest Determination Date, Telerate Screen
3750 fails to indicate the London interbank offered rate for one-year United
States dollar deposits, then One-Year LIBOR for the related Accrual Period will
be established by the Indenture Trustee as follows:
(i) If on such Interest Determination Date two or
more Reference Banks provide such offered quotations, One-Year LIBOR
for the related Accrual Period shall be the arithmetic mean of such
offered quotations (rounded upwards if necessary to the nearest whole
multiple of 1/16%).
26
(ii) If on such Interest Determination Date fewer
than two Reference Banks provide such offered quotations, One-Year
LIBOR for the related Accrual Period shall be the higher of (i)
One-Year LIBOR as determined on the previous Interest Determination
Date and (ii) the Reserve Interest Rate.
(iii) If no such quotations can be obtained and no
Reference Bank rate is available, One-Month LIBOR will be the One-Month
LIBOR rate applicable to the preceding Accrual Period.
The establishment of One-Year LIBOR on each Interest Determination Date
by the Indenture Trustee and the Indenture Trustee's calculation of the
applicable Note Interest Rate applicable for the related Accrual Period shall
(in the absence of manifest error) be final and binding.
OPINION OF COUNSEL: A written opinion of counsel acceptable to the
Indenture Trustee, in its reasonable discretion which counsel may be in-house
counsel for the Master Servicer if acceptable to the Indenture Trustee and the
Rating Agencies or counsel for the Depositor, as the case may be.
ORIGINAL VALUE: Except in the case of a refinanced Mortgage Loan, the
lesser of the Appraised Value or sales price of Mortgaged Property at the time a
Mortgage Loan is closed, and for a refinanced Mortgage Loan, the Original Value
is the value of such property set forth in an appraisal acceptable to the Master
Servicer.
OUTSTANDING: With respect to the Notes, as of the date of
determination, all Notes theretofore executed, authenticated and delivered under
this Indenture except:
(i) Notes theretofore canceled by the Note Registrar
or delivered to the Indenture Trustee for cancellation; and
(ii) Notes in exchange for or in lieu of which other
Notes have been executed, authenticated and delivered pursuant to the
Indenture unless proof satisfactory to the Indenture Trustee is
presented that any such Notes are held by a holder in due course.
OUTSTANDING MORTGAGE LOAN: As to any Due Date, a Mortgage Loan
(including an REO Property) which was not the subject of a Principal Prepayment
in Full, Cash Liquidation or REO Disposition and which was not purchased,
deleted or substituted for prior to such Due Date pursuant to the Servicing
Agreement.
OVERCOLLATERALIZATION INCREASE AMOUNT: With respect to any Payment Date
and any Loan Group, the lesser of (i) the related Net Monthly Excess Cashflow
for such Payment Date and (ii) the excess, if any, of (a) the related
Overcollateralization Target Amount over (b) the related Overcollateralized
Amount on such Payment Date (after taking into account payments to the related
Notes of the related Basic Principal Distribution Amount on such Payment Date).
27
OVERCOLLATERALIZATION TARGET AMOUNT: The Group I Overcollateralization
Target Amount, Group II Overcollateralization Target Amount, Group III
Overcollateralization Target Amount or Group IV Overcollateralization Target
Amount, as applicable.
OVERCOLLATERALIZED AMOUNT: For any Payment Date and each Loan Group,
the amount, if any, by which (i) the aggregate principal balance of the related
Mortgage Loans (after giving effect to scheduled payments of principal due
during the related Due Period, to the extent received or advanced, and
unscheduled collections of principal received during the related Prepayment
Period, including Realized Losses on the related Mortgage Loans incurred during
the related Prepayment Period), exceeds (ii) the aggregate Note Principal
Balance of the related Notes as of such Payment Date (assuming that 100% of the
related Principal Remittance Amount is applied as a principal payment on the
related Notes on such Payment Date).
OWNER TRUST ESTATE: The corpus of the Issuer created by the Trust
Agreement which consists of items referred to in Section 3.01 of the Trust
Agreement.
OWNER TRUSTEE: Wilmington Trust Company and its successors and assigns
or any successor owner trustee appointed pursuant to the terms of the Trust
Agreement.
OWNER TRUSTEE'S FEE: A fee of $4,000 per annum payable to the Owner
Trustee in advance on the Closing Date and each anniversary thereof by the
Indenture Trustee; provided, however, that in the event of any removal or
resignation of the Owner Trustee, the Owner Trustee will promptly remit to the
Indenture Trustee the portion of the Owner Trustee Fee that would have been
earned by the Owner Trustee during the remainder of such year had it not been
removed or resigned or the Notes redeemed.
PAYING AGENT: Any paying agent or co-paying agent appointed pursuant to
Section 3.03 of the Indenture, which initially shall be the Indenture Trustee.
PAYMENT ACCOUNT: The account established by the Indenture Trustee
pursuant to Section 3.01 of the Indenture. The Payment Account shall be an
Eligible Account.
PAYMENT DATE: The 25th day of each month, or if such day is not a
Business Day, then the next Business Day, commencing in April 2004.
PERCENTAGE INTEREST: With respect to any Note, the percentage obtained
by dividing the Note Principal Balance of such Note by the aggregate Note
Principal Balances of all Notes of that Class. With respect to any Certificate,
the percentage as stated on the face thereof.
PERIODIC RATE CAP: With respect to any ARM Loan, the maximum rate, if
any, by which the Mortgage Rate on such Mortgage Loan can adjust on any
Adjustment Date, as stated in the related Mortgage Note or Mortgage.
PERSON: Any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.
28
PLAN: Any employee benefit plan or certain other retirement plans and
arrangements, including individual retirement accounts and annuities, Xxxxx
plans and bank collective investment funds and insurance company general or
separate accounts in which such plans, accounts or arrangements are invested,
that are subject to ERISA or Section 4975 of the Code.
PLAN ASSETS: Assets of a Plan within the meaning of Department of Labor
regulation 29 C.F.R. ss. 2510.3-101.
POOL BALANCE: With respect to any date of determination, the aggregate
of the Stated Principal Balances of all Mortgage Loans as of such date.
PREPAYMENT ASSUMPTION: A 25% CPR with respect to each Loan Group.
PREPAYMENT INTEREST SHORTFALL: As to any Payment Date and any Mortgage
Loan (other than a Mortgage Loan relating to an REO Property) that was the
subject of (a) a Principal Prepayment in Full during the related Prepayment
Period, an amount equal to the excess of interest accrued during the related
Prepayment Period at the Net Mortgage Rate on the Stated Principal Balance of
such Mortgage Loan over the sum of the amount of interest paid by the Mortgagor
for such Prepayment Period to the date of such Principal Prepayment in Full and
any Advances made by the Master Servicer pursuant to Section 4.04 of the
Servicing Agreement or (b) a partial Principal Prepayment during the related
Prepayment Period, an amount equal to the interest at the Mortgage Rate (less
the Master Servicing Fee Rate) during the related Prepayment Period on the
amount of such partial Principal Prepayment.
PREPAYMENT PERIOD: With respect to each Mortgage Loan and any Payment
Date, the prior calendar month.
PRIMARY INSURANCE POLICY: Each primary policy of mortgage guaranty
insurance issued by a Qualified Insurer or any replacement policy therefor.
PRINCIPAL DISTRIBUTION AMOUNT: For any Payment Date and any Loan Group,
the sum of (a) the related Basic Principal Distribution Amount, (b) any amounts
in respect of payments of the related Undercollateralization Amount from related
Net Monthly Excess Cashflow and related Crossable Undercollateralization Amount
from non-related Net Monthly Excess Cashflow on that Payment Date and (c) the
related Overcollateralization Increase Amount.
PRINCIPAL PREPAYMENT: Any payment of principal or other recovery on a
Mortgage Loan, including a recovery that takes the form of Liquidation Proceeds
or Insurance Proceeds, which is received in advance of its scheduled Due Date
and is not accompanied by an amount as to interest representing scheduled
interest on such payment due on any date or dates in any month or months
subsequent to the month of prepayment.
PRINCIPAL PREPAYMENT IN FULL: Any Principal Prepayment made by a
Mortgagor of the entire principal balance of a Mortgage Loan.
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PRINCIPAL REMITTANCE AMOUNT: With respect to any Payment Date and each
Loan Group, the sum of the following:
(i) the principal portion of each previously
undistributed Monthly Payment due after the Cut-off Date received on or
prior to the related Determination Date or advanced prior to such
Payment Date (other than Monthly Payments due after the related Due
Period, which shall be treated as if received during the Due Period
they were due) on each Outstanding Mortgage Loan;
(ii) the principal portion of all proceeds of any
Mortgage Loan repurchased during the related Prepayment Period (or
deemed to have been so repurchased in accordance with the Servicing
Agreement) pursuant to the Servicing Agreement and the amount of any
shortfall deposited in the Collection Account in connection with the
substitution of a Deleted Mortgage Loan pursuant to the Mortgage Loan
Purchase Agreement; and
(iii) the principal portion of all other unscheduled
collections received during the related Prepayment Period (including,
without limitation, Principal Prepayments, Insurance Proceeds,
Liquidation Proceeds and REO Proceeds) to the extent applied by the
Master Servicer as recoveries of principal of the related Mortgage Loan
pursuant to the Servicing Agreement.
PROCEEDING: Any suit in equity, action at law or other judicial or
administrative proceeding.
PROSPECTUS: The Prospectus Supplement, dated March 30, 2004, together
with the attached Prospectus, dated March 30, 2004.
PURCHASE PRICE: The meaning specified in Section 2.2(a) of the Mortgage
Loan Purchase Agreement.
PURCHASER: American Home Mortgage Securities LLC., a Delaware
corporation, and its successors and assigns.
QUALIFIED INSURER: A mortgage guaranty insurance company duly qualified
as such under the laws of the state of its principal place of business and each
state having jurisdiction over such insurer in connection with the insurance
policy issued by such insurer, duly authorized and licensed in such states to
transact a mortgage guaranty insurance business in such states and to write the
insurance provided by the insurance policy issued by it, approved as an insurer
by the Master Servicer and as a Xxxxxx Xxx-approved mortgage insurer.
RATING AGENCY: Any nationally recognized statistical rating
organization, or its successor, that rated the Notes at the request of the
Depositor at the time of the initial issuance of the Notes. Initially, Standard
& Poor's. If such organization or a successor is no longer in existence, "Rating
Agency" with respect to the Class A Notes and Class M Notes shall be such
nationally recognized statistical rating organization, or other comparable
Person, notice of which designation shall be given to the Indenture Trustee.
References herein to the highest short term unsecured rating category of a
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Rating Agency shall mean A-1 or better in the case of Standard & Poor's and in
the case of any other Rating Agency shall mean such equivalent ratings.
References herein to the highest long-term rating category of a Rating Agency
shall mean "AAA" in the case of Standard & Poor's and in the case of any other
Rating Agency, such equivalent rating.
REALIZED LOSS: With respect to a Mortgage Loan is (i) a Deficient
Valuation, or (ii) as to any Liquidated Mortgage Loan, the unpaid principal
balance thereof plus accrued and unpaid interest thereon at the Mortgage Rate
through the last day of the month of liquidation less the Net Liquidation
Proceeds with respect to such Mortgage Loan and the related Mortgaged Property.
RECORD DATE: With respect to the Group I Notes which are Book-Entry
Notes and any Payment Date, the close of business on the Business Day
immediately preceding such Payment Date. With respect to any Group II Notes,
Group III Note and Group IV Notes and any Group I Notes that are not Book-Entry
Notes, the close of business on the last Business Day of the calendar month
preceding such Payment Date.
REFERENCE BANKS: Any leading banks selected by the Indenture Trustee
after consultation with the Master Servicer and engaged in transactions in
Eurodollar deposits in the international Eurocurrency market (i) with an
established place of business in London, (ii) whose quotations appear on the
Telerate Screen Page 3750 on the Interest Determination Date in question, (iii)
which have been designated as such by the Indenture Trustee after consultation
with the Master Servicer, and (iv) which are not Affiliates of the Depositor,
the Seller or the Master Servicer.
REGISTERED HOLDER: The Person in whose name a Note is registered in the
Note Register on the applicable Record Date.
RELATED DOCUMENTS: With respect to each Mortgage Loan, the documents
specified in Section 2.1(b) of the Mortgage Loan Purchase Agreement and any
documents required to be added to such documents pursuant to the Mortgage Loan
Purchase Agreement, the Trust Agreement, Indenture or the Servicing Agreement.
RELIEF ACT: The Servicemember's Civil Relief Act.
RELIEF ACT SHORTFALL: As to any Payment Date and any Mortgage Loan
(other than a Mortgage Loan relating to an REO Property), any shortfalls
relating to the Relief Act or similar legislation or regulations.
REMITTANCE REPORT: The report prepared by the Master Servicer pursuant
to Section 4.01 of the Servicing Agreement.
REO ACQUISITION: The acquisition by the Master Servicer on behalf of
the Issuer for the benefit of the Noteholders of any REO Property pursuant to
Section 3.13 of the Servicing Agreement.
REO DISPOSITION: As to any REO Property, a determination by the Master
Servicer that it has received substantially all Insurance Proceeds, Liquidation
Proceeds, REO Proceeds and other
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payments and recoveries (including proceeds of a final sale) which the Master
Servicer expects to be finally recoverable from the sale or other disposition of
the REO Property.
REO IMPUTED INTEREST: As to any REO Property, for any period, an amount
equivalent to interest (at the Net Mortgage Rate that would have been applicable
to the related Mortgage Loan had it been Outstanding) on the unpaid principal
balance of the Mortgage Loan as of the date of acquisition thereof for such
period as such balance is reduced pursuant to Section 3.13 of the Servicing
Agreement by any income from the REO Property treated as a recovery of
principal.
REO PROCEEDS: Proceeds, net of expenses, received in respect of any REO
Property (including, without limitation, proceeds from the rental of the related
Mortgaged Property) which proceeds are required to be deposited into the
Collection Account only upon the related REO Disposition.
REO PROPERTY: A Mortgaged Property that is acquired by the Issuer by
foreclosure or by deed in lieu of foreclosure.
REPURCHASE PRICE: With respect to any Mortgage Loan required to be
repurchased by the Seller on any date pursuant to the Mortgage Loan Purchase
Agreement or purchased by the Master Servicer pursuant to the Servicing
Agreement, an amount equal to the sum, without duplication, of (i) 100% of the
Stated Principal Balance thereof (without reduction for any amounts charged off)
and (ii) unpaid accrued interest at the Mortgage Rate on the outstanding
principal balance thereof from the Due Date to which interest was last paid by
the Mortgagor to the first day of the month following the month of purchase plus
(iii) the amount of unreimbursed Advances or unreimbursed Servicing Advances
made with respect to such Mortgage Loan plus (iv) any other amounts owed to the
Master Servicer pursuant to Section 3.07 of the Servicing Agreement and not
included in clause (iii) of this definition plus (v) any costs and damages
incurred by the trust in connection with any violation by such loan of any
predatory-lending law.
RESERVE INTEREST RATE: With respect to any Interest Determination Date,
the rate per annum that the Indenture Trustee determines to be either (i) the
arithmetic mean (rounded upwards if necessary to the nearest whole multiple of
0.0625%) of the one-month, six-month or one-year (as applicable) United States
dollar lending rates which New York City banks selected by the Indenture Trustee
are quoting on the relevant Interest Determination Date to the principal London
offices of leading banks in the London interbank market or (ii) in the event
that the Indenture Trustee can determine no such arithmetic mean, the lowest
one-month, six-month or one-year (as applicable) United States dollar lending
rate which New York City banks selected by the Indenture Trustee are quoting on
such Interest Determination Date to leading European banks.
RESPONSIBLE OFFICER: With respect to the Indenture Trustee, any officer
of the Indenture Trustee with direct responsibility for the administration of
the Indenture 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.
SECURITIES ACT: The Securities Act of 1933, as amended, and the rules
and regulations promulgated thereunder.
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SECURITIES INTERMEDIARY: Xxxxx Fargo Bank, National Association, or its
successors and assigns.
SECURITY: Any of the Certificates or Notes.
SECURITYHOLDER or HOLDER: Any Noteholder or a Certificateholder.
SECURITY INSTRUMENT: A written instrument creating a valid first lien
on a Mortgaged Property securing a Mortgage Note, which may be any applicable
form of mortgage, deed of trust, deed to secure debt or security deed, including
any riders or addenda thereto.
SELLER: American Home Mortgage Investment Corp., a Maryland
corporation, and its successors and assigns.
SERVICING ACCOUNT: The separate trust account created and maintained by
the Master Servicer or each Subservicer with respect to the Mortgage Loans or
REO Property, which shall be an Eligible Account, for collection of taxes,
assessments, insurance premiums and comparable items as described in Section
3.08 of the Servicing Agreement.
SERVICING ADVANCES: All customary, reasonable and necessary "out of
pocket"costs and expenses incurred in connection with a default, delinquency or
other unanticipated event in the performance by the Master Servicer or any
Subservicer of its servicing obligations, including, without duplication, 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 and any expenses incurred in relation to any such proceedings that
result from the Mortgage Loan being registered on the MERS(R) System, (iii) the
management and liquidation of any REO Property and (iv) compliance with the
obligations under Sections 3.10, 3.11, 3.13 of the Servicing Agreement.
SERVICING AGREEMENT: The Servicing Agreement dated as of March 31,
2004, among the Master Servicer, the Issuer and the Indenture Trustee.
SERVICING CERTIFICATE: A certificate completed and executed by a
Servicing Officer on behalf of the Master Servicer in accordance with Section
4.01 of the Servicing Agreement.
SERVICING DEFAULT: The meaning assigned in Section 6.01 of the
Servicing Agreement.
SERVICING OFFICEr: Any officer of the Master Servicer involved in, or
responsible for, the administration and servicing of the Mortgage Loans whose
name and specimen signature appear on a list of servicing officers furnished to
the Indenture Trustee by the Master Servicer on the Closing Date, as such list
may be amended from time to time.
SIX-MONTH LIBOR: With respect to any Accrual Period, the rate
determined by the Indenture Trustee on the related Interest Determination Date
on the basis of the London interbank offered rate for six-month United States
dollar deposits, as such rates appear on the Telerate Screen Page 3750, as of
11:00 a.m. (London time) on such Interest Determination Date.
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In the event that on any Interest Determination Date, Telerate Screen
3750 fails to indicate the London interbank offered rate for six-month United
States dollar deposits, then Six-Month LIBOR for the related Accrual Period will
be established by the Indenture Trustee as follows:
(i) If on such Interest Determination Date two or
more Reference Banks provide such offered quotations, Six-Month LIBOR
for the related Accrual Period shall be the arithmetic mean of such
offered quotations (rounded upwards if necessary to the nearest whole
multiple of 1/16%).
(ii) If on such Interest Determination Date fewer
than two Reference Banks provide such offered quotations, Six-Month
LIBOR for the related Accrual Period shall be the higher of (i)
Six-Month LIBOR as determined on the previous Interest Determination
Date and (ii) the Reserve Interest Rate.
(iii) If no such quotations can be obtained and no
Reference Bank rate is available, Six-Month LIBOR will be the Six-Month
LIBOR rate applicable to the preceding Accrual Period.
The establishment of Six-Month LIBOR on each Interest Determination
Date by the Indenture Trustee and the Indenture Trustee's calculation of the
applicable Note Interest Rate applicable for the related Accrual Period shall
(in the absence of manifest error) be final and binding.
STANDARD & POOR'S: Standard & Poor's, a division of The XxXxxx-Xxxx
Companies, Inc., or its successor in interest.
STATED PRINCIPAL BALANCE: With respect to any Mortgage Loan or related
REO Property as of any date of determination, (i) the principal balance of the
Mortgage Loan outstanding as of the Cut- off Date, after application of all
scheduled Monthly Payments due on or before such date, whether or not received,
minus (ii) the sum of (a) the principal portion of the Monthly Payments due with
respect to such Mortgage Loan or REO Property during each Due Period ending
prior to the most recent Payment Date which were received or with respect to
which an Advance was made, (b) all Principal Prepayments with respect to such
Mortgage Loan or REO Property, and all Insurance Proceeds, Liquidation Proceeds
and REO Proceeds to the extent applied by the Master Servicer as recoveries of
principal in accordance with Section 3.13 of the Servicing Agreement with
respect to such Mortgage Loan or REO Property, which were distributed pursuant
to Section 3.05 of the Indenture on any previous Payment Date, and (c) the
principal portion of any Realized Loss with respect thereto allocated pursuant
to Section 3.29 of the Indenture for any previous Payment Date.
STATUTORY TRUST STATUTE: Chapter 38 of Title 12 of the Delaware Code,
12 DEL. Code ss.ss.3801 ET SEQ., as the same may be amended from time to time.
STEP-UP DATE: The Payment Date occurring after the first Payment Date
for which the aggregate Stated Principal Balance of the Mortgage Loans as of the
end of the related Due Period has been reduced to 10% or less of the aggregate
Stated Principal Balance of the Mortgage Loans as of the Cut-off Date.
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SUBSERVICER: Any Person with whom the Master Servicer has entered into
a Subservicing Agreement as a Subservicer.
SUBSERVICING ACCOUNT: An Eligible Account established or maintained by
a Subservicer as provided for in Section 3.06(e) of the Servicing Agreement.
SUBSERVICING AGREEMENT: The written contract between the Master
Servicer and any Subservicer relating to servicing and administration of certain
Mortgage Loans as provided in Section 3.02 of the Servicing Agreement.
SUBSEQUENT RECOVERIES: Any Liquidation Proceeds received after the
final liquidation of a Mortgage Loan.
SUBSTITUTION ADJUSTMENT AMOUNT: With respect to any Eligible Substitute
Mortgage Loan, the amount as defined in Section 2.03 of the Servicing Agreement.
TELERATE SCREEN PAGE 3750: The display designated as page 3750 on the
Telerate Service (or such other page as may replace page 3750 on that service
for the purpose of displaying London interbank offered rates of major banks).
TREASURY REGULATIONS: Regulations, including proposed or temporary
Regulations, promulgated under the Code. References herein to specific
provisions of proposed or temporary regulations shall include analogous
provisions of final Treasury Regulations or other successor Treasury
Regulations.
TRUST: The American Home Mortgage Investment Trust 2004-1 to be created
pursuant to the Trust Agreement.
TRUST AGREEMENT: The Amended and Restated Trust Agreement dated as of
March 31, 2004, among the Owner Trustee, the Depositor and Xxxxx Fargo Bank,
National Association, as Certificate Registrar and Certificate Paying Agent,
relating to the Trust.
TRUST ESTATE: The meaning specified in the Granting Clause of the
Indenture.
TRUST INDENTURE ACT OR TIA: The Trust Indenture Act of 1939, as amended
from time to time, as in effect on any relevant date.
UCC: The Uniform Commercial Code, as amended from time to time, as in
effect in any specified jurisdiction.
UNDERCOLLATERALIZATION AMOUNT: With respect to any Loan Group and any
Payment Date, an amount equal to the excess, if any, of (i) the aggregate Note
Principal Balance of the related Notes immediately prior to that Payment Date,
over (ii) the aggregate Stated Principal Balance of the related Mortgage Loans
as of the beginning of the related Due Period.
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UNDERCOLLATERALIZATION PAYMENT CROSSABLE EXCESS: With respect to Loan
Group I, Loan Group II, Loan Group III and Loan Group IV and any Payment Date,
an amount equal to the related Net Monthly Excess Cashflow remaining after the
payment of Net Monthly Excess Cashflow as set forth in clauses (d)(i), (g)(i),
(j)(i) and (m)(i), respectively, of Section 3.05 of the Indenture.
UNDERWRITERS: Bear, Xxxxxxx & Co. Inc. and Xxxxxx Brothers Inc., or
their successors.
UNINSURED CAUSE: Any cause of damage to property subject to a Mortgage
that the complete restoration of such property is not fully reimbursable by the
hazard insurance policies.
UNPAID INTEREST SHORTFALL: For each Class of Notes and any Payment
Date, such Notes' pro rata share, based on the amount of Accrued Note Interest
otherwise payable on such Note on such Payment Date, of (a) any Prepayment
Interest Shortfalls, to the extent not covered by Compensating Interest, and (b)
any Relief Act Shortfalls.
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