EXHIBIT 4.1
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WACHOVIA ASSET SECURITIZATION ISSUANCE, LLC,
as Depositor,
[ ],
as Servicer,
and
[ ],
as Trustee
POOLING AND SERVICING AGREEMENT
Dated , 200
_______________________
Mortgage Pass-Through Certificates
Series 200 -
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TABLE OF CONTENTS
Page
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PRELIMINARY STATEMENT.............................................................................................1
ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms.................................................................................3
Section 1.02 Interest Calculations........................................................................25
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01 Conveyance of Mortgage Loans.................................................................25
Section 2.02 Acceptance by the Trustee of the Mortgage Loans..............................................28
Section 2.03 Representations, Warranties and Covenants of the Servicer....................................30
Section 2.04 Representations and Warranties of the Depositor as to the Mortgage Loans.....................31
Section 2.05 Designation of Interests in the REMIC........................................................38
Section 2.06 Designation of Start-up Day..................................................................38
Section 2.07 REMIC Certificate Maturity Date..............................................................38
Section 2.08 Execution and Delivery of Certificates.......................................................39
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01 Servicer to Service Mortgage Loans...........................................................39
Section 3.02 Subservicing; Enforcement of the Obligations of Servicer.....................................40
Section 3.03 Fidelity Bond; Errors and Omissions Insurance................................................41
Section 3.04 Access to Certain Documentation..............................................................41
Section 3.05 Maintenance of Primary Mortgage Insurance Policy; Claims.....................................42
Section 3.06 Rights of the Depositor and the Trustee in Respect of the Servicer...........................42
Section 3.07 Trustee to Act as Servicer...................................................................43
Section 3.08 Collection of Mortgage Loan Payments; Servicer Custodial Account; and Certificate Account....43
Section 3.09 Collection of Taxes, Assessments and Similar Items; Escrow Accounts..........................46
Section 3.10 Access to Certain Documentation and Information Regarding the Mortgage Loans.................48
Section 3.11 Permitted Withdrawals from the Servicer Custodial Account and Certificate Account............48
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Section 3.12 Maintenance of Hazard Insurance..............................................................49
Section 3.13 Enforcement of Due-On-Sale Clauses; Assumption Agreements....................................50
Section 3.14 Realization Upon Defaulted Mortgage Loans; REO Property......................................52
Section 3.15 Trustee to Cooperate; Release of Mortgage Files..............................................54
Section 3.16 Documents, Records and Funds in Possession of the Servicer to be Held for the Trustee........56
Section 3.17 Servicing Compensation.......................................................................56
Section 3.18 Annual Statement as to Compliance............................................................56
Section 3.19 Annual Independent Public Accountants' Servicing Statement; Financial Statements.............57
Section 3.20 Advances.....................................................................................57
Section 3.21 Modifications, Waivers, Amendments and Consents..............................................57
Section 3.22 Reports to the Securities and Exchange Commission............................................59
ARTICLE IV
SERVICER'S CERTIFICATE
Section 4.01 Servicer's Certificate.......................................................................59
ARTICLE V
PAYMENTS AND STATEMENTS TO CERTIFICATEHOLDERS;
REMIC ADMINISTRATION
Section 5.01 Distributions................................................................................59
Section 5.02 Priorities of Distributions..................................................................60
Section 5.03 Allocation of Losses.........................................................................63
Section 5.04 Statements to Certificateholders.............................................................65
Section 5.05 Tax Returns and Reports to Certificateholders................................................67
Section 5.06 Tax Matters Person...........................................................................68
Section 5.07 Rights of the Tax Matters Person in Respect of the Trustee...................................68
Section 5.08 REMIC Related Covenants......................................................................68
ARTICLE VI
THE CERTIFICATES
Section 6.01 The Certificates.............................................................................70
Section 6.02 Registration of Transfer and Exchange of Certificates........................................71
Section 6.03 Mutilated, Destroyed, Lost or Stolen Certificates............................................75
Section 6.04 Persons Deemed Owners........................................................................75
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ARTICLE VII
THE DEPOSITOR AND THE SERVICER
Section 7.01 Respective Liabilities of the Depositor and the Servicer.....................................75
Section 7.02 Merger or Consolidation of the Depositor or the Servicer.....................................76
Section 7.03 Limitation on Liability of the Depositor, the Servicer and Others............................76
Section 7.04 Depositor and Servicer Not to Resign.........................................................77
ARTICLE VIII
DEFAULT
Section 8.01 Events of Default............................................................................77
Section 8.02 Remedies of Trustee..........................................................................78
Section 8.03 Directions by Certificateholders and Duties of Trustee During Event of Default...............79
Section 8.04 Action upon Certain Failures of the Servicer and upon Event of Default.......................79
Section 8.05 Trustee to Act; Appointment of Successor.....................................................79
Section 8.06 Notification to Certificateholders...........................................................80
ARTICLE IX
THE TRUSTEE
Section 9.01 Duties of Trustee............................................................................80
Section 9.02 Certain Matters Affecting the Trustee........................................................82
Section 9.03 Trustee Not Liable for Certificates or Mortgage Loans........................................83
Section 9.04 Trustee May Own Certificates.................................................................84
Section 9.05 Eligibility Requirements for Trustee.........................................................84
Section 9.06 Resignation and Removal of Trustee...........................................................84
Section 9.07 Successor Trustee............................................................................85
Section 9.08 Merger or Consolidation of Trustee...........................................................85
Section 9.09 Appointment of Co-Trustee or Separate Trustee................................................86
Section 9.10 Authenticating Agents........................................................................87
Section 9.11 Trustee's Fees and Expenses..................................................................87
Section 9.12 Appointment of Custodian.....................................................................88
Section 9.13 Paying Agents................................................................................88
Section 9.14 Limitation of Liability......................................................................89
Section 9.15 Trustee May Enforce Claims Without Possession of Certificates................................89
Section 9.16 Suits for Enforcement........................................................................89
Section 9.17 Waiver of Bond Requirement...................................................................89
Section 9.18 Waiver of Inventory, Accounting and Appraisal Requirement....................................90
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ARTICLE X
TERMINATION
Section 10.01 Termination upon Purchase by the Depositor or Liquidation of All Mortgage Loans..............90
Section 10.02 Additional Termination Requirements..........................................................91
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01 Amendment....................................................................................92
Section 11.02 Recordation of Agreement.....................................................................93
Section 11.03 Limitation on Rights of Certificateholders...................................................94
Section 11.04 Governing Law................................................................................94
Section 11.05 Notices......................................................................................95
Section 11.06 Severability of Provisions...................................................................95
Section 11.07 Certificates Nonassessable and Fully Paid....................................................95
Section 11.08 Access to List of Certificateholders.........................................................95
Section 11.09 Recharacterization...........................................................................96
EXHIBITS
Exhibit A-1 - Form of Face of Class A-1 Certificate
Exhibit A-2 - Form of Face of Class A-2 Certificate
Exhibit A-3 - Form of Face of Class A-3 Certificate
Exhibit A-4 - Form of Face of Class A-4 Certificate
Exhibit A-5 - Form of Face of Class A-5 Certificate
Exhibit A-6 - Form of Face of Class A-6 Certificate
Exhibit A-WIO - Form of Face of Class A-WIO Certificate
Exhibit A-PO - Form of Face of Class A-PO Certificate
Exhibit A-R - Form of Face of Class A-R Certificate
Exhibit A-LR - Form of Face of Class A-LR Certificate
Exhibit B-1 - Form of Face of Class B-1 Certificate
Exhibit B-2 - Form of Face of Class B-2 Certificate
Exhibit B-3 - Form of Face of Class B-3 Certificate
Exhibit B-4 - Form of Face of Class B-4 Certificate
Exhibit B-5 - Form of Face of Class B-5 Certificate
Exhibit B-6 - Form of Face of Class B-6 Certificate
Exhibit C Form of Reverse of all Certificates...........................................................C-1
Exhibit D Mortgage Loan Schedule........................................................................D-1
Exhibit E Request for Release of Documents..............................................................E-1
Exhibit F Form of Certification of Establishment of Account.............................................F-1
Exhibit G-1 Form of Transferor's Certificate............................................................G-1-1
Exhibit G-2A Form 1 of Transferee's Certificate.........................................................G-2A-1
Exhibit G-2B Form 2 of Transferee's Certificate.........................................................G-2B-1
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Exhibit H Form of Transferee Representation Letter
for ERISA Restricted Certificates.............................................................H-1
Exhibit I Form of Affidavit Regarding Transfer of Residual Certificates.................................I-1
Exhibit J Contents of Servicing File....................................................................J-1
Exhibit K Form of Special Servicing Agreement...........................................................K-1
Exhibit L List of Recordation States....................................................................L-1
Exhibit M Principal Balance Schedules...................................................................M-1
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EXHIBIT 4.1
POOLING AND SERVICING AGREEMENT
THIS POOLING AND SERVICING AGREEMENT, dated , 200 is hereby executed
by and among WACHOVIA ASSET SECURITIZATION ISSUANCE, LLC, as depositor (together
with its permitted successors and assigns, the "Depositor"), , as servicer
(together with its permitted successors and assigns, the "Servicer"), and , as
trustee (together with its permitted successors and assigns, the "Trustee").
W I T N E S S E T H T H A T:
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In consideration of the mutual agreements herein contained, the
Depositor, the Servicer and the Trustee agree as follows:
PRELIMINARY STATEMENT
In exchange for the Certificates, the Depositor hereby conveys the
Trust Estate to the Trustee to create the Trust. The Trust Estate for federal
income tax purposes will be treated as two separate real estate mortgage
investment conduits (the "Upper-Tier REMIC" and the "Lower-Tier REMIC,"
respectively, and each, a "REMIC"). The Class A Certificates (other than the
Class A-R and Class A-LR Certificates) and the Class B Certificates are referred
to collectively as the "Regular Certificates" and shall constitute "regular
interests" in the Upper-Tier REMIC. The Uncertificated Lower-Tier Interests
shall constitute the "regular interests" in the Lower-Tier REMIC. The Class A-R
Certificate shall be the "residual interest" in the Upper-Tier REMIC and the
Class A-LR Certificate shall be the "residual interest" in the Lower-Tier REMIC.
The Certificates will represent the entire beneficial ownership interest in the
Trust. The "latest possible maturity date" for federal income tax purposes of
all interests created hereby will be the REMIC Certificate Maturity Date.
The following table sets forth characteristics of the Certificates,
together with the minimum denominations and integral multiples in excess thereof
in which the Classes of Certificates shall be issuable (except that one
Certificate of each Class of Certificates may be issued in any amount in excess
of the minimum denomination):
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Integral Multiples
Initial Class Certificate Pass-Through Minimum In Excess
Classes Balance or Notional Amount Rate Denomination Of Minimum
- --------------------- --------------------------- ---------------- --------------------- --------------------
Class A-1 $ % $ $
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Class A-2 $ % $ $
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Class A-3 $ % $ $
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Class A-4 $ (1) $ $
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Class A-5 $ (2) $ $
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Class A-6 $ % $ $
- --------------------- --------------------------- ---------------- --------------------- --------------------
Class A-PO $ (4) $ $
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Class A-WIO $ (3) $ $
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Class A-R $ % $ $
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Class A-LR $ % $ $
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Class B-1 $ % $ $
- --------------------- --------------------------- ---------------- --------------------- --------------------
Class B-2 $ % $ $
- --------------------- --------------------------- ---------------- --------------------- --------------------
Class B-3 $ % $ $
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Class B-4 $ % $ $
- --------------------- --------------------------- ---------------- --------------------- --------------------
Class B-5 $ % $ $
- --------------------- --------------------------- ---------------- --------------------- --------------------
Class B-6 $ % $ $
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(1) During the initial Interest Accrual Period, interest will accrue on the
Class A-4 Certificates at a rate of % per annum. During each Interest Accrual
Period thereafter, interest will accrue on the Class A-4 Certificates at a per
annum rate equal to (i) % plus (ii) LIBOR, subject to a minimum rate of % and a
maximum rate of %.
(2) During the initial Interest Accrual Period, interest will accrue on the
Class A-5 Certificates at a rate of % per annum. During each Interest Accrual
Period thereafter, interest will accrue on the Class A-5 Certificates at a per
annum rate equal to (i) % minus (ii) LIBOR, subject to a minimum rate of % and a
maximum rate of
%.
(3) Interest will accrue on the Class A-WIO Notional Amount as of any
Distribution Date at a per annum rate equal to (i) the weighted average of the
Net Mortgage Interest Rates of the Premium Mortgage Loans (based on the Stated
Principal Balance of the Premium Mortgage Loans on the Due Date in the month
preceding the month of such Distribution Date minus (ii) %.
(4) Class A-PO Certificates will be Principal Only Certificates and will not
bear interest.
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ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms. Whenever used in this Agreement, the
following words and phrases, unless the context otherwise requires, shall have
the meanings specified in this Article:
1933 Act: The Securities Act of 1933, as amended.
Accrued Certificate Interest: For any Distribution Date and each
interest-bearing Class, one month's interest accrued during the related Interest
Accrual Period at the applicable Pass-Through Rate on the applicable Class
Certificate Balance or Notional Amount, as applicable.
Adjusted Pool Amount: With respect to any Distribution Date, the
Cut-Off Date Pool Principal Balance of the Mortgage Loans minus the sum of (i)
all amounts in respect of principal received in respect of the Mortgage Loans
(including, without limitation, amounts received as Monthly Payments, Periodic
Advances, Principal Prepayments, Liquidation Proceeds and Substitution
Adjustment Amounts) and distributed to Holders of Certificates on such
Distribution Date and all prior Distribution Dates and (ii) the principal
portion of all Realized Losses (other than Debt Service Reductions) incurred on
the Mortgage Loans from the Cut-Off Date through the end of the month preceding
such Distribution Date.
Adjusted Pool Amount (PO Portion): With respect to any Distribution
Date, the sum of the amounts, calculated as follows, with respect to all
Outstanding Mortgage Loans: the product of (i) the PO Percentage for each such
Mortgage Loan and (ii) the remainder of (A) the Cut-Off Date Principal Balance
of such Mortgage Loan minus (B) the sum of (x) all amounts in respect of
principal received in respect of such Mortgage Loan (including, without
limitation, amounts received as Monthly Payments, Periodic Advances, Principal
Prepayments, Liquidation Proceeds and Substitution Adjustment Amounts) and
distributed to Holders of the Certificates on such Distribution Date and all
prior Distribution Dates and (y) the principal portion of any Realized Loss
(other than a Debt Service Reduction) incurred on such Mortgage Loan from the
Cut-Off Date through the end of the month preceding such Distribution Date.
Advance: A Periodic Advance or a Servicing Advance.
Agreement: This Pooling and Servicing Agreement together with all
amendments hereof and supplements hereto.
Amount Held for Future Distribution: As to any Distribution Date, the
total of the amounts held in the Servicer Custodial Account at the close of
business on the preceding Determination Date on account of (i) Principal
Prepayments and Liquidation Proceeds received or made in the month of such
Distribution Date and (ii) payments which represent receipt of Monthly Payments
in respect of a Due Date or Due Dates subsequent to the related Due Date.
Appraised Value: With respect to any Mortgaged Property, either (i)
the lesser of (a) the appraised value determined in an appraisal obtained by the
originator at origination of
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such Mortgage Loan and (b) the sales price for such property, except that, in
the case of Mortgage Loans the proceeds of which were used to refinance an
existing mortgage loan, the Appraised Value of the related Mortgaged Property is
the appraised value thereof determined in an appraisal obtained at the time of
refinancing, or (ii) the appraised value determined in an appraisal made at the
request of a Mortgagor subsequent to origination in order to eliminate the
Mortgagor's obligation to keep a Primary Insurance Policy in force.
Assignment of Mortgage: An individual assignment of the Mortgage,
notice of transfer or equivalent instrument in recordable form, sufficient under
the laws of the jurisdiction wherein the related Mortgaged Property is located
to give record notice of the sale of the Mortgage.
Authenticating Agents: As defined in Section 9.10.
Book-Entry Certificate: All Classes of Certificates other than the
Physical Certificates.
Business Day: Any day other than (i) a Saturday or a Sunday or
(ii) a day on which banking institutions in the State of North Carolina, the
State of New York, the state in which the servicing offices of the Servicer is
located or the state in which the Corporate Trust Office is located are required
or authorized by law or executive order to be closed.
Certificate: Any of the Wachovia Asset Securitization Issuance, LLC
Mortgage Pass-Through Certificates, Series 200 - that are issued pursuant to
this Agreement.
Certificate Account: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 3.08(c) in the name of the Trustee
for the benefit of the Certificateholders and designated " , in trust for
registered holders of Wachovia Asset Securitization Issuance, LLC Mortgage
Pass-Through Certificates, Series 200 - ." Funds in the Certificate Account
shall be held in trust for the Certificateholders for the uses and purposes set
forth in this Agreement.
Certificate Balance: With respect to any Certificate at any date, the
maximum dollar amount of principal to which the Holder thereof is then entitled
hereunder, such amount being equal to the product of the Percentage Interest of
such Certificate and the Class Certificate Balance of the Class of Certificates
of which such Certificate is a part.
Certificate Custodian: Initially, ; thereafter any other Certificate
Custodian acceptable to the Depository and selected by the Trustee.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of a Book-Entry Certificate. With respect to
any Definitive Certificate, the Certificateholder of such Certificate.
Certificate Register: The register maintained pursuant to Section
6.02.
Certificate Registrar: The registrar appointed pursuant to Section
6.02.
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Certificateholder: The Person in whose name a Certificate is
registered in the Certificate Register, except that, solely for the purpose of
giving any consent pursuant to this Agreement, any Certificate registered in the
name of the Depositor, the Servicer or any affiliate thereof shall be deemed not
to be outstanding and the Percentage Interest and Voting Rights evidenced
thereby shall not be taken into account in determining whether the requisite
amount of Percentage Interests or Voting Rights, as the case may be, necessary
to effect any such consent has been obtained, unless such entity is the
registered owner of the entire Class of Certificates, provided that the Trustee
shall not be responsible for knowing that any Certificate is registered in the
name of such an affiliate unless one of its Responsible Officers has actual
knowledge.
Class: As to the Certificates, the Class A-1, Class A-2, Class A-3,
Class A-4, Class A-5, Class A-6, Class A-PO, Class A-WIO, Class A-R, Class A-LR,
Class B-1, Class B-2, Class B-3, Class B-4, Class B-5 and Class B-6
Certificates, as the case may be.
Class A Certificates: The Class A-1, Class A-2, Class A-3, Class A-4,
Class A-5, Class A-6, Class A-PO, Class A-WIO, Class A-R and Class A-LR
Certificates.
Class A-5 Notional Amount: As to any Distribution Date and the Class
A-5 Certificates, the Class Certificate Balance of the Class A-4 Certificates.
Class A-PO Deferred Amount: As to any Distribution Date prior to the
Senior Credit Support Depletion Date, the aggregate of the applicable PO
Percentage of each Realized Loss to be allocated to the Class A-PO Certificates
on such Distribution Date or previously allocated to the Class A-PO Certificates
and not yet paid to the Holders of the Class A-PO Certificates pursuant to
Section 5.02(a)(iii) and the amount (without duplication) of any reduction in
the Class Certificate Balance of the Class A-PO Certificates pursuant to Section
5.03(b).
Class A-WIO Notional Amount: As to any Distribution Date and the Class
A-WIO Certificates, the aggregate Stated Principal Balances of the Premium
Mortgage Loans on the Due Date in the month preceding the month of such
Distribution.
Class B Certificates: The Class B-1, Class B-2, Class B-3, Class B-4,
Class B-5 and Class B-6 Certificates.
Class Certificate Balance: With respect to any Class (other than the
Class A-5 and Class A-WIO Certificates) and any date of determination, the
Initial Class Certificate Balance of such Class minus the sum of (i) all
distributions of principal made with respect thereto, (ii) all Realized Losses
allocated thereto pursuant to Section 5.03(a), and (iii) all other reductions in
Class Certificate Balance previously allocated thereto pursuant to Section
5.03(b). The Class A-5 and Class A-WIO Certificates are Interest-Only
Certificates and have no Class Certificate Balance.
Class Interest Shortfall: For any Distribution Date and each
interest-bearing Class, the amount by which Accrued Certificate Interest for
such Class (as reduced pursuant to Section 5.02(c)) exceeds the amount of
interest actually distributed on such Class on such Distribution Date pursuant
to clause (i) of the definition of "Interest Distribution Amount."
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Class Unpaid Interest Shortfall: As to any Distribution Date and each
interest-bearing Class, the amount by which the aggregate Class Interest
Shortfalls for such Class on prior Distribution Dates exceeds the amount of
interest actually distributed on such Class on such prior Distribution Dates
pursuant to clause (ii) of the definition of "Interest Distribution Amount."
Closing Date: , 200 .
Code: The Internal Revenue Code of 1986, as amended.
Compensating Interest: As defined in Section 3.17.
Co-op Shares: Shares issued by private non-profit housing
corporations.
Corporate Trust Office: The principal office of the Trustee at which
at any particular time its certificate transfer services are conducted, which
office at the date of the execution of this instrument is located at
_________________, _________________, ________________, Attention: .
Corresponding Upper-Tier Class or Classes: As to the following
Uncertificated Lower-Tier Interests, the Corresponding Upper-Tier Class or
Classes, as follows:
Uncertificated Lower-Tier Interest Corresponding Upper-Tier Class or Classes
Class A-L1 Interest Class A-1 Certificates, Class A-2
Certificates and Class A-6 Certificates
Class A-L3 Interest Class A-3 Certificates
Class A-L4 Interest Class A-4 Certificates and Class A-5
Certificates
Class A-LPO Interest Class A-PO Certificates
Class A-LUR Interest Class A-R Certificate
Class A-LWIO Interest Class A-WIO Certificates
Class B-L1 Interest Class B-1 Certificates
Class B-L2 Interest Class B-2 Certificates
Class B-L3 Interest Class B-3 Certificates
Class B-L4 Interest Class B-4 Certificates
Class B-L5 Interest Class B-5 Certificates
Class B-L6 Interest Class B-6 Certificates
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Custodian: Initially, the Trustee, and thereafter the Custodian, if
any, hereafter appointed by the Trustee pursuant to Section 9.12. The Custodian
may (but need not) be the Trustee or any Person directly or indirectly
controlling or controlled by or under common control of either of them. Neither
the Servicer nor the Depositor, nor any Person directly or indirectly
controlling or controlled by or under common control with any such Person may be
appointed Custodian.
Customary Servicing Procedures: With respect to the Servicer,
procedures (including collection procedures) that the Servicer customarily
employs and exercises in servicing and administering mortgage loans for its own
account and which are in accordance with accepted mortgage servicing practices
of prudent lending institutions servicing mortgage loans of the same type as the
Mortgage Loans in the jurisdictions in which the related Mortgaged Properties
are located.
Cut-Off Date: , 200 .
Cut-Off Date Pool Principal Balance: The aggregate of the Cut-Off Date
Principal Balances of the Mortgage Loans which is $ .
Cut-Off Date Principal Balance: As to any Mortgage Loan, the unpaid
principal balance thereof as of the close of business on the Cut-Off Date,
reduced by all installments of principal due on or prior thereto whether or not
paid.
Debt Service Reduction: As to any Mortgage Loan and any Determination
Date, the excess of (i) the Monthly Payment due on the related Due Date under
the terms of such Mortgage Loan over (ii) the amount of the monthly payment of
principal and/or interest required to be paid with respect to such Due Date by
the Mortgagor as established by a court of competent jurisdiction (pursuant to
an order which has become final and nonappealable) as a result of a proceeding
initiated by or against the related Mortgagor under the Bankruptcy Code, as
amended from time to time (11 U.S.C.); provided that no such excess shall be
considered a Debt Service Reduction so long as (a) the Servicer is pursuing an
appeal of the court order giving rise to any such modification and (b)(1) such
Mortgage Loan is not in default with respect to payment due thereunder in
accordance with the terms of such Mortgage Loan as in effect on the Cut-Off Date
or (2) Monthly Payments are being advanced by the Servicer in accordance with
the terms of such Mortgage Loan as in effect on the Cut-Off Date.
Debt Service Reduction Mortgage Loan: Any Mortgage Loan that became
the subject of a Debt Service Reduction.
Defective Mortgage Loan: Any Mortgage Loan which is required to be
cured, repurchased or substituted for pursuant to Sections 2.02 or 2.04.
Deficient Valuation: As to any Mortgage Loan and any Determination
Date, the excess of (i) the then outstanding indebtedness under such Mortgage
Loan over (ii) the secured valuation thereof established by a court of competent
jurisdiction (pursuant to an order which has become final and nonappealable) as
a result of a proceeding initiated by or against the related Mortgagor under the
Bankruptcy Code, as amended from time to time (11 U.S.C.), pursuant to which
such Mortgagor retained such Mortgaged Property; provided that no such excess
shall be
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considered a Deficient Valuation so long as (a) the Servicer is pursuing an
appeal of the court order giving rise to any such modification and (b)(1) such
Mortgage Loan is not in default with respect to payments due thereunder in
accordance with the terms of such Mortgage Loan as in effect on the Cut-Off Date
or (2) Monthly Payments are being advanced by the Servicer in accordance with
the terms of such Mortgage Loan as in effect on the Cut-Off Date.
Deficient Valuation Mortgage Loan: Any Mortgage Loan that became the
subject of a Deficient Valuation.
Definitive Certificates: As defined in Section 6.02(c)(iii).
Depositor: Wachovia Asset Securitization Issuance, LLC, a North
Carolina limited liability company, or its successor in interest, as depositor
of the Trust Estate.
Depository: The Depository Trust Company, the nominee of which is Cede
& Co., as the registered Holder of the Book-Entry Certificates or any successor
thereto appointed in accordance with this Agreement. The Depository shall at all
times be a "clearing corporation" as defined in Section 8-102(3) of the Uniform
Commercial Code of the State of New York.
Depository Participant: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
Determination Date: As to any Distribution Date, the 16th day of the
month of the related Distribution Date or, if such 16th day is not a Business
Day, the Business Day immediately preceding such 16th day.
Discount Mortgage Loan: Any Mortgage Loan with a Net Mortgage Interest
Rate that is less than % per annum.
Distribution Date: The th day of each month beginning in 200 (or, if
such day is not a Business Day, the next Business Day).
Due Date: As to any Distribution Date and each Mortgage Loan, the
first day in the calendar month of such Distribution Date.
Eligible Account: Any of (i) an account or accounts maintained with
(a) , or (b) a federal or state chartered depository institution or trust
company the short-term unsecured debt obligations of which (or, in the case of a
depository institution or trust company that is the principal subsidiary of a
holding company, the debt obligations of such holding company) have the highest
short-term ratings of each Rating Agency at the time any amounts are held on
deposit therein, or (ii) an account or accounts in a depository institution or
trust company in which such accounts are insured by the FDIC (to the limits
established by the FDIC) and the uninsured deposits in which accounts are
otherwise secured such that, as evidenced by an Opinion of Counsel delivered to
the Trustee and to each Rating Agency, the Certificateholders have a claim with
respect to the funds in such account or a perfected first priority security
interest against any collateral (which shall be limited to Permitted
Investments) securing such funds that is superior to claims of any other
depositors or creditors of the
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depository institution or trust company in which such account is maintained, or
(iii) a trust account or accounts maintained with the trust department of a
federal or state chartered depository institution or trust company, acting in
its fiduciary capacity or (iv) any other account acceptable to each Rating
Agency. Eligible Accounts may bear interest and may include, if otherwise
qualified under this definition, accounts maintained with the Trustee.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA Restricted Certificates: Any Class B-4, Class B-5, or Class B-6
Certificate.
Escrow Account: As defined in Section 3.09.
Escrow Payments: The amounts constituting taxes, assessments, Primary
Insurance Policy premiums, fire and hazard insurance premiums and other payments
as may be required to be escrowed by the Mortgagor with the mortgagee pursuant
to the terms of any Mortgage Note or Mortgage.
Event of Default: As defined in Section 8.01.
Excess Proceeds: With respect to any Liquidated Mortgage Loan, the
amount, if any, by which the sum of any Liquidation Proceeds of such Mortgage
Loan received in the calendar month in which such Mortgage Loan became a
Liquidated Mortgage Loan, net of any amounts previously reimbursed to the
Servicer as Nonrecoverable Advance(s) with respect to such Mortgage Loan
pursuant to Section 3.11(a)(iii), exceeds (i) the unpaid principal balance of
such Liquidated Mortgage Loan as of the Due Date in the month in which such
Mortgage Loan became a Liquidated Mortgage Loan plus (ii) accrued interest at
the Mortgage Interest Rate from the Due Date as to which interest was last paid
or for which a Periodic Advance was made (and not reimbursed) up to the Due Date
applicable to the Distribution Date immediately following the calendar month
during which such liquidation occurred.
FDIC: The Federal Deposit Insurance Corporation, or any successor
thereto.
FHLMC: The Federal Home Loan Mortgage Corporation, or any successor
thereto.
Final Distribution Date: The Distribution Date on which the final
distribution in respect of the Certificates will be made pursuant to Section
10.01.
Financial Market Service: Bloomberg Financial Service and any other
financial information provider designated by the Depositor by written notice to
the Trustee.
FIRREA: The Financial Institutions Reform, Recovery and Enforcement
Act of 1989, as amended.
[Fitch: Fitch Ratings, and its successors in interest.]
FNMA: Fannie Mae, or any successor thereto.
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Fractional Interest: As defined in Section 5.02(d).
Holder: A Certificateholder.
Independent: When used with respect to any specified Person means such
a Person who (i) is in fact independent of the Depositor and the Servicer, (ii)
does not have any direct financial interest or any material indirect financial
interest in the Depositor or the Servicer or in an affiliate of either of them,
and (iii) is not connected with the Depositor or the Servicer as an officer,
employee, promoter, underwriter, trustee, partner, director or person performing
similar functions.
Initial Class Certificate Balance: As to each Class of Certificates
(other than the Class A-5 and Class A-WIO Certificates), the Class Certificate
Balance set forth in the Preliminary Statement. The Class A-5 and Class A-WIO
Certificates are Interest-Only Certificates and have no Initial Class
Certificate Balance.
Initial Notional Amount: As to each Class of Interest-Only
Certificates, the Notional Amount set forth in the Preliminary Statement.
Insurance Policy: With respect to any Mortgage Loan included in the
Trust Estate, any related insurance policy, including all riders and
endorsements thereto in effect, including any replacement policy or policies for
any Insurance Policies.
Insurance Proceeds: Proceeds paid by an insurer pursuant to any
Insurance Policy, in each case other than any amount included in such Insurance
Proceeds in respect of Insured Expenses.
Insured Expenses: Expenses covered by an Insurance Policy or any other
insurance policy with respect to the Mortgage Loans.
Interest Accrual Period: As to any Distribution Date and each Class of
Certificates (other than the Class A-4, Class A-5 and A-PO Certificates), the
period from and including the first day of the calendar month preceding the
calendar month of such Distribution Date to but not including the first day of
the calendar month of such Distribution Date. As to any Distribution Date and
the Class A-4 and Class A-5 Certificates, the period from and including the day
of the calendar month preceding the calendar month in which such Distribution
Date occurs and ending on the day of the calendar month in which such
Distribution Date occurs.
Interest Distribution Amount: For any Distribution Date and each
interest-bearing Class, the sum of (i) the Accrued Certificate Interest, subject
to reduction pursuant to Section 5.02(c) and (ii) any Class Unpaid Interest
Shortfall for such Class.
Interest-Only Certificates: Any Class of Certificates entitled to
distributions of interest, but no distributions of principal. The Class A-5 and
Class A-WIO Certificates are the only Classes of Interest-Only Certificates.
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LIBOR: As to any Distribution Date, the arithmetic mean of the London
Interbank offered rate quotations for one-month U.S. Dollar deposits, as
determined by the Trustee in accordance with Section 5.09.
LIBOR Business Day: Any Business Day on which banks are open for
dealing in foreign currency and exchange in London, England, the City of New
York and the State where the Corporate Trust Office is located.
LIBOR Certificates: Any of the Class A-4 and Class A-5 Certificates.
Liquidated Mortgage Loan: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) that was liquidated in the
calendar month preceding the month of such Distribution Date and as to which the
Servicer has certified (in accordance with this Agreement) that it has received
all proceeds it expects to receive in connection with the liquidation of such
Mortgage Loan including the final disposition of an REO Property.
Liquidation Proceeds: Amounts, including Insurance Proceeds, received
in connection with the partial or complete liquidation of defaulted Mortgage
Loans, whether through trustee's sale, foreclosure sale or otherwise or amounts
received in connection with any condemnation or partial release of a Mortgaged
Property and any other proceeds received in connection with an REO Property,
less the sum of related unreimbursed Servicing Fees and Advances.
Loan-to-Value Ratio: With respect to any Mortgage Loan and any date of
determination, the fraction, expressed as a percentage, the numerator of which
is the outstanding principal balance of the related Mortgage Loan at the date of
determination and the denominator of which is the Appraised Value of the related
Mortgaged Property.
Lower-Tier Distribution Amount: As defined in Section 5.02(a).
Lower-Tier REMIC: As defined in the Preliminary Statement, the assets
of which consist of the Mortgage Loans, such amounts as shall from time to time
be held in the Certificate Account, the insurance policies, if any, relating to
a Mortgage Loan and property which secured a Mortgage Loan and which has been
acquired by foreclosure or deed in lieu of foreclosure.
MERS: As defined in Section 2.01(b)(iii).
Monthly Payment: The scheduled monthly payment on a Mortgage Loan due
on any Due Date allocable to principal and/or interest on such Mortgage Loan
which, unless otherwise specified herein, shall give effect to any related Debt
Service Reduction and any Deficient Valuation that affects the amount of the
monthly payment due on such Mortgage Loan.
Mortgage: The mortgage, deed of trust or other instrument creating a
first lien on a Mortgaged Property securing a Mortgage Note or creating a first
lien on a leasehold interest.
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Mortgage File: The mortgage documents listed in Section 2.01
pertaining to a particular Mortgage Loan and any additional documents required
to be added to the Mortgage File pursuant to this Agreement.
Mortgage Interest Rate: As to any Mortgage Loan, the per annum rate of
interest at which interest accrues on the principal balance of such Mortgage
Loan in accordance with the terms of the related Mortgage Note.
Mortgage Loan Purchase Agreement: The Mortgage Loan Purchase
Agreement, dated ___________________, 200__, between the , as seller, and the
Depositor, as purchaser.
Mortgage Loan Schedule: The list of Mortgage Loans (as from time to
time amended by the Servicer to reflect the addition of Substitute Mortgage
Loans and the deletion of Defective Mortgage Loans pursuant to the provisions of
this Agreement) transferred to the Trustee as part of the Trust Estate and from
time to time subject to this Agreement, attached hereto as Exhibit D, setting
forth the following information with respect to each Mortgage Loan: (i) the
Mortgage Loan identifying number; (ii) a code indicating whether the Mortgaged
Property is owner-occupied; (iii) the property type for each Mortgaged Property;
(iv) the original months to maturity or the remaining months to maturity from
the Cut-Off Date; (v) the Loan-to-Value Ratio at origination; (vi) the Mortgage
Interest Rate; (vii) the date on which the first Monthly Payment was due on the
Mortgage Loan, and, if such date is not the Due Date currently in effect, such
Due Date; (viii) the stated maturity date; (ix) the amount of the Monthly
Payment as of the Cut-Off Date; (x) the paid-through date; (xi) the original
principal amount of the Mortgage Loan; (xii) the principal balance of the
Mortgage Loan as of the close of business on the Cut-Off Date, after application
of payments of principal due on or before the Cut-Off Date, whether or not
collected, and after deduction of any payments collected of scheduled principal
due after the Cut-Off Date; (xiii) a code indicating the purpose of the Mortgage
Loan; (xiv) a code indicating the documentation style; and (xv) the Appraised
Value. With respect to the Mortgage Loans in the aggregate, the Mortgage Loan
Schedule shall set forth the following information, as of the Cut-Off Date: (i)
the number of Mortgage Loans; (ii) the current aggregate outstanding principal
balance of the Mortgage Loans; (iii) the weighted average Mortgage Rate of the
Mortgage Loans; and (iv) the weighted average months to maturity of the Mortgage
Loans.
Mortgage Loans: Such of the mortgage loans transferred and assigned to
the Trustee pursuant to Section 2.01 as from time to time are held as a part of
the Trust Estate (including any Substitute Mortgage Loans and REO Property), the
Mortgage Loans originally so held being identified in the Mortgage Loan
Schedule.
Mortgage Note: The originally executed note or other evidence of
indebtedness evidencing the indebtedness of a Mortgagor under a Mortgage Loan,
together with all riders thereto and amendments thereof.
Mortgaged Property: The underlying property securing a Mortgage Loan,
which may include Co-op Shares or residential long-term leases.
Mortgagor: The obligor on a Mortgage Note.
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Net Mortgage Interest Rate: As to any Mortgage Loan and Distribution
Date, such Mortgage Loan's Mortgage Interest Rate thereon on the first day of
the month preceding the month of the related Distribution Date reduced by the
Servicing Fee Rate and the Trustee Fee Rate.
Non-PO Percentage: As to any Discount Mortgage Loan, a fraction
(expressed as a percentage), the numerator of which is the Net Mortgage Interest
Rate of such Discount Mortgage Loan and the denominator of which is %. As to any
Mortgage Loan that is not a Discount Mortgage Loan, 100%.
Non-PO Principal Amount: As to any Distribution Date, the sum of the
applicable Non-PO Percentage of (a) the principal portion of each Monthly
Payment due on each Mortgage Loan on the related Due Date, (b) the Stated
Principal Balance, as of the date of repurchase, of each Mortgage Loan that was
repurchased by the Depositor pursuant to this Agreement as of such Distribution
Date, (c) any Substitution Adjustment Amount in connection with a Defective
Mortgage Loan received with respect to such Distribution Date, (d) any
Liquidation Proceeds allocable to recoveries of principal of Mortgage Loans that
are not yet Liquidated Mortgage Loans received during the calendar month
preceding the month of such Distribution Date, (e) with respect to each Mortgage
Loan that became a Liquidated Mortgage Loan during the calendar month preceding
the month of such Distribution Date, the amount of Liquidation Proceeds
allocable to principal received during the calendar month preceding the month of
such Distribution Date with respect to such Mortgage Loan and (f) all Principal
Prepayments received during the calendar month preceding the month of such
Distribution Date.
Non-Supported Interest Shortfalls: As to any Distribution Date, the
amount, if any, by which the aggregate of Prepayment Interest Shortfalls exceeds
Compensating Interest for such Distribution Date.
Non-U.S. Person: A Person other than a U.S. Person.
Nonrecoverable Advance: Any portion of an Advance previously made or
proposed to be made in respect of a Mortgage Loan which has not been previously
reimbursed and which, in the good faith judgment of the Servicer, will not or,
in the case of a proposed Advance, would not be ultimately recoverable from the
related Mortgagor, related Liquidation Proceeds, or other recoveries in respect
of the related Mortgage Loan.
Notional Amount: With respect to: (i) the Class A-5 Certificates and
any date of determination, the Class A-5 Notional Amount and (ii) the Class
A-WIO Certificates and any date of determination, the Class A-WIO Notional
Amount.
Offered Certificates: The Class A, Class B-1, Class B-2 and Class B-3
Certificates.
Officer's Certificate: A certificate signed by the Chairman of the
Board, Vice Chairman of the Board, President or a Vice President and by the
Treasurer, the Secretary or one of the Assistant Treasurers or Assistant
Secretaries, or any other duly authorized officer of the Depositor or the
Servicer, as the case may be, and delivered to the Trustee.
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Opinion of Counsel: A written opinion of counsel acceptable to the
Trustee, who may be counsel for the Depositor or the Servicer, except that any
opinion of counsel relating to the qualification of the Trust Estate as two
separate REMICs or compliance with the REMIC Provisions must be an opinion of
Independent counsel.
Original Fractional Interest: With respect to each of the following
Classes of Subordinate Certificates, the corresponding percentage described
below, as of the Closing Date:
Class B-1 %
Class B-2 %
Class B-3 %
Class B-4 %
Class B-5 %
Class B-6 %
Original Subordinate Certificate Balance: $________________.
OTS: The Office of Thrift Supervision.
Outstanding Mortgage Loan: As to any Due Date, a Mortgage Loan which
was not the subject of a Principal Prepayment in Full prior to such Due Date,
which did not become a Liquidated Mortgage Loan prior to such Due Date and which
was not purchased from the Trust prior to such Due Date pursuant to Sections
2.02 or 2.04.
Ownership Interest: As to any Certificate, any ownership or security
interest in such Certificate, including any interest in such Certificate as the
Holder thereof and any other interest therein, whether direct or indirect, legal
or beneficial, as owner or as pledgee.
Pass-Through Rate: As to each Class of interest-bearing Certificates,
the per annum rate set forth in the Preliminary Statement.
Paying Agent: As defined in Section 9.13.
Percentage Interest: As to any Certificate, the percentage obtained by
dividing the initial Certificate Balance of such Certificate (or the initial
notional amount for a Class A-5 or Class A-WIO Certificate) by the Initial Class
Certificate Balance or Initial Notional Amount, as applicable, of the Class of
which such Certificate is a part.
Periodic Advance: The payment required to be made by the Servicer with
respect to any Distribution Date pursuant to Section 3.20, the amount of any
such payment being equal to the aggregate of Monthly Payments (net of the
Servicing Fee) on the Mortgage Loans (including any REO Property) that were due
on the related Due Date and not received as of the close of business on the
related Determination Date, less the aggregate amount of any such delinquent
payments that the Servicer has determined would constitute a Nonrecoverable
Advance if advanced.
Permitted Investments: One or more of the following:
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(i) obligations of or guaranteed as to principal and interest by the United
States, FHLMC, FNMA or any agency or instrumentality of the United States when
such obligations are backed by the full faith and credit of the United States;
provided that such obligations of FHLMC or FNMA shall be limited to senior debt
obligations and mortgage participation certificates other than investments in
mortgage-backed or mortgage participation securities with yields evidencing
extreme sensitivity to the rate of principal payments on the underlying
mortgages, which shall not constitute Permitted Investments hereunder;
(ii) repurchase agreements on obligations specified in clause (i) maturing
not more than one month from the date of acquisition thereof with a corporation
incorporated under the laws of the United States or any state thereof rated not
lower than " " by and " " by ;
(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, rated not lower than " " by and " " by ;
(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 is rated not lower than " " by and " " by ;
(v) investments in money market funds (including funds of the Trustee or
its affiliates, or funds for which an affiliate of the Trustee acts as advisor,
as well as funds for which the Trustee and its affiliates may receive
compensation) rated either " " by and " " by or otherwise approved in writing by
each Rating Agency; and
(vi) other obligations or securities that are acceptable to each Rating
Agency and, as evidenced by an Opinion of Counsel obtained by the Servicer, will
not affect the qualification of the Trust Estate as two separate REMICs;
provided, however, that no instrument shall be a Permitted Investment if it
represents either (a) the right to receive only interest payments with respect
to the underlying debt instrument or (b) the right to receive both principal and
interest payments derived from obligations underlying such instrument and the
principal and interest with respect to such instrument provide a yield to
maturity greater than 120% of the yield to maturity at par of such underlying
obligations.
Permitted Transferee: Any Person other than (i) the United States, or
any State or any political subdivision thereof, or any agency or instrumentality
of any of the foregoing, (ii) a foreign government, international organization
or any agency or instrumentality of either of the foregoing, (iii) an
organization which is exempt from tax imposed by Chapter 1 of the Code
(including the tax imposed by Section 511 of the Code on unrelated business
taxable income)
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(except certain farmers' cooperatives described in Code Section 521), (iv) rural
electric and telephone cooperatives described in Code Section 1381(a)(2)(C) and
(v) any other Person so designated by the Servicer based on an Opinion of
Counsel to the effect that any transfer to such Person may cause the Trust or
any other Holder of a Residual Certificate to incur tax liability that would not
be imposed other than on account of such transfer. The terms "United States,"
"State" and "international organization" shall have the meanings set forth in
Code Section 7701 or successor provisions.
Person: Any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
Physical Certificates: The Class A-R, Class A-LR, Class B-4, Class B-5
and Class B-6 Certificates.
Plan: As defined in Section 6.02(e).
PO Percentage: As to any Discount Mortgage Loan, 100% minus the Non-PO
Percentage for such Mortgage Loan. As to any Mortgage Loan that is not a
Discount Mortgage Loan, 0%.
PO Principal Amount: As to any Distribution Date, the sum of the
applicable PO Percentage of (a) the principal portion of each Monthly Payment
due on each Mortgage Loan on the related Due Date, (b) the Stated Principal
Balance, as of the date of repurchase, of each Mortgage Loan that was
repurchased by the related Seller or the Depositor pursuant to this Agreement as
of such Distribution Date, (c) any Substitution Adjustment Amount in connection
with any Defective Mortgage Loan received with respect to such Distribution
Date, (d) any Liquidation Proceeds allocable to recoveries of principal of
Mortgage Loans that are not yet Liquidated Mortgage Loans received during the
calendar month preceding the month of such Distribution Date, (e) with respect
to each Mortgage Loan that became a Liquidated Mortgage Loan during the calendar
month preceding the month of such Distribution Date, the amount of Liquidation
Proceeds allocable to principal received with respect to such Mortgage Loan
during the calendar month preceding the month of such Distribution Date with
respect to such Mortgage Loan and (f) all Principal Prepayments received during
the calendar month preceding the month of such Distribution Date.
Pool Distribution Amount: As to any Distribution Date, the excess of
(a) the sum of (i) the aggregate of (A) the interest portion of any Monthly
Payment (net of the Servicing Fee) and the principal portion of any Monthly
Payment due on the Due Date in the month in which such Distribution Date occurs
and which is received prior to the related Determination Date and (B) all
Periodic Advances and payments of Compensating Interest made by the Servicer in
respect of such Distribution Date deposited to the Servicer Custodial Account
pursuant to Section 3.08(b)(vii); (ii) all Liquidation Proceeds received during
the preceding calendar month and deposited to the Servicer Custodial Account
pursuant to Section 3.08(b)(iii); (iii) all Principal Prepayments received
during the month preceding the month of such Distribution Date and deposited to
the Servicer Custodial Account pursuant to Section 3.08(b)(i) during such
period; (iv) in connection with Defective Mortgage Loans, as applicable, the
aggregate of the
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Repurchase Prices and Substitution Adjustment Amounts deposited on the related
Remittance Date pursuant to Section 3.08(b)(vi); and (v) any other amounts in
the Servicer Custodial Account deposited therein pursuant to Sections
3.08(b)(iv), (v) and (viii) in respect of such Distribution Date; over (b) any
(i) amounts permitted to be withdrawn from the Servicer Custodial Account
pursuant to clauses (i) through (vii), inclusive, of Section 3.11(a) and (ii)
amounts permitted to be withdrawn from the Certificate Account pursuant to
clauses (i) and (ii) of Section 3.11(b).
Pool Stated Principal Balance: As to any Distribution Date, the
aggregate Stated Principal Balances of all Mortgage Loans that were Outstanding
Mortgage Loans immediately following the Due Date in the month of such
Distribution Date.
Premium Mortgage Loan: Any Mortgage Loan with a Net Mortgage Interest
Rate that is equal to or more than % per annum.
Prepayment Interest Shortfall: As to any Distribution Date and each
Mortgage Loan subject to a Principal Prepayment received during the calendar
month preceding such Distribution Date, the amount, if any, by which one month's
interest at the related Mortgage Interest Rate (net of the Servicing Fee) on
such Principal Prepayment exceeds the amount of interest paid in connection with
such Principal Prepayment.
Primary Insurance Policy: Each policy of primary mortgage guaranty
insurance or any replacement policy therefor with respect to any Mortgage Loan,
in each case issued by an insurer acceptable to FNMA or FHLMC.
Principal-Only Certificates: Any Class of Certificates entitled to
distributions of principal, but to no distributions of interest. The Class A-PO
Certificates are the only Principal-Only Certificates.
Principal Prepayment: Any payment or other recovery of principal on a
Mortgage Loan (other than Liquidation Proceeds) which is received in advance of
its scheduled Due Date and is not accompanied by an amount of interest
representing scheduled interest due on any date or dates in any month or months
subsequent to the month of prepayment.
Principal Prepayment in Full: Any Principal Prepayment of the entire
principal balance of a Mortgage Loan.
Priority Amount: As to any Distribution Date, the lesser of (i) the
Class Certificate Balance of the Class A-6 Certificates and (ii) the product of
(a) the Shift Percentage, (b) the Priority Percentage and (c) the Non-PO
Principal Amount.
Priority Percentage: As to any Distribution Date, the percentage
equivalent (carried to six places rounded up) of a fraction the numerator of
which is the Class Certificate Balance of the Class A-6 Certificates immediately
prior to such date and the denominator of which is the aggregate of the Class
Certificate Balances of all Classes of Certificates (other than the Class A-PO
Certificates) immediately prior to such date.
Private Certificates: The Class B-4, Class B-5 and Class B-6
Certificates.
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Pro Rata Share: As to any Distribution Date and any Class of
Subordinate Certificates that is not a Restricted Class, the portion of the
Subordinate Principal Distribution Amount allocable to such Class, equal to the
product of the Subordinate Principal Distribution Amount for such Distribution
Date and a fraction, the numerator of which is the related Class Certificate
Balance thereof and the denominator of which is the aggregate Class Certificate
Balance of the Subordinate Certificates that are not Restricted Classes. The Pro
Rata Share of a Restricted Class shall be 0%.
Qualified Appraiser: An appraiser of a Mortgaged Property duly
appointed by the originator of the related Mortgage Loan, who had no interest,
direct or indirect, in such Mortgaged Property or in any loan made on the
security thereof, whose compensation is not affected by the approval or
disapproval of the related Mortgage Loan and who met the minimum qualifications
of FNMA or FHLMC.
Rate Determination Date: As to any Distribution Date and any Class of
LIBOR Certificates, the second LIBOR Business Day prior to the beginning of the
applicable Interest Accrual Period for such Class and such Distribution Date.
Rating Agency: Each of and . If either such organization or a
successor is no longer in existence, "Rating Agency" shall be such nationally
recognized statistical rating organization, or other comparable Person, as is
designated by the Depositor, notice of which designation shall be given to the
Trustee. References herein to a given rating or rating category of a Rating
Agency shall mean such rating category without giving effect to any modifiers.
Realized Loss: With respect to each Liquidated Mortgage Loan, an
amount as of the date of such liquidation, equal to (i) the unpaid principal
balance of the Liquidated Mortgage Loan as of the date of such liquidation, plus
(ii) interest at the Net Mortgage Interest Rate from the Due Date as to which
interest was last paid or advanced (and not reimbursed) to Certificateholders up
to the Due Date in the month in which Liquidation Proceeds are required to be
distributed on the Stated Principal Balance of such Liquidated Mortgage Loan
from time to time, minus (iii) the Liquidation Proceeds, if any, received during
the month in which such liquidation occurred, to the extent applied as
recoveries of interest at the Net Mortgage Interest Rate and to principal of the
Liquidated Mortgage Loan. With respect to each Mortgage Loan that has become the
subject of a Deficient Valuation, if the principal amount due under the related
Mortgage Note has been reduced, the difference between the principal balance of
the Mortgage Loan outstanding immediately prior to such Deficient Valuation and
the principal balance of the Mortgage Loan as reduced by the Deficient
Valuation. With respect to each Mortgage Loan that has become the subject of a
Debt Service Reduction and any Distribution Date, the amount, if any, by which
the principal portion of the related Monthly Payment has been reduced.
Record Date: The last day of the month (or, if such day is not a
Business Day, the preceding Business Day) preceding the month of the related
Distribution Date.
Refinance Mortgage Loan: Any Mortgage Loan the proceeds of which were
not used to purchase the related Mortgaged Property.
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Regular Certificates: As defined in the Preliminary Statement hereto.
Relief Act: The Soldiers' and Sailors' Civil Relief Act of 1940, as
amended.
Relief Act Reduction: With respect to any Distribution Date, for any
Mortgage Loan as to which there has been a reduction in the amount of interest
collectible thereon for the most recently ended calendar month as a result of
the application of the Relief Act or comparable state legislation, the amount,
if any, by which (i) interest collectible on such Mortgage Loan for the most
recently ended calendar month is less than (ii) interest accrued pursuant to the
terms of the Mortgage Note on the same principal amount and for the same period
as the interest collectible on such Mortgage Loan for the most recently ended
calendar month.
REMIC: A "real estate mortgage investment conduit" within the meaning
of Section 860D of the Code.
REMIC Certificate Maturity Date: The "latest possible maturity date"
of the Regular Certificates as that term is defined in Section 2.07.
REMIC Provisions: Provisions of the federal income tax law relating to
real estate mortgage investment conduits, which appear at Section 860A through
860G of Subchapter M of Chapter 1 of the Code, and related provisions, and
regulations promulgated thereunder, as the foregoing may be in effect from time
to time, as well as provisions of applicable state laws.
Remittance Date: As to any Distribution Date, by 2:00 p.m. Eastern
time on the second Business Day immediately preceding such Distribution Date.
REO Disposition Period: As defined in Section 3.14.
REO Proceeds: Proceeds, net of any related expenses of the Servicer,
received in respect of any REO Property (including, without limitation, proceeds
from the rental of the related Mortgaged Property) which are received prior to
the final liquidation of such Mortgaged Property.
REO Property: A Mortgaged Property acquired by the Servicer on behalf
of the Trust through foreclosure or deed-in-lieu of foreclosure in connection
with a defaulted Mortgage Loan.
Repurchase Price: As to any Defective Mortgage Loan repurchased on any
date pursuant to Sections 2.02 or 2.04, an amount equal to the sum of (i) the
unpaid principal balance thereof and (ii) the unpaid accrued interest thereon at
the applicable Mortgage Interest Rate from the Due Date to which interest was
last paid by the Mortgagor to the first day of the month following the month in
which such Mortgage Loan became eligible to be repurchased.
Request for Release: The Request for Release submitted by the Servicer
to the Trustee or the Custodian on behalf of the Trustee, substantially in the
form of Exhibit E.
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Required Insurance Policy: With respect to any Mortgage Loan, any
insurance policy which is required to be maintained from time to time under this
Agreement in respect of such Mortgage Loan.
Reserve Interest Rate: As defined in Section 5.09.
Residual Certificates: The Class A-R and Class A-LR Certificates.
Responsible Officer: When used with respect to the Trustee, any
officer of the Corporate Trust Department of the Trustee, including any Senior
Vice President, any Vice President, any Assistant Vice President, any Assistant
Secretary, any Trust Officer or Assistant Trust Officer, or any other officer of
the Trustee customarily performing functions similar to those performed by any
of the above designated officers and having responsibility for the
administration of this Agreement.
Restricted Classes: As defined in Section 5.02(d).
[S&P: Standard & Poor's, a Division of The McGraw-Hill Companies,
Inc., and its successors in interest.]
Seller: __________________, a ____________________, or its successor
in interest, as seller of the Mortgage Loans under the Mortgage Loan Purchase
Agreement.
Senior Certificates: The Class A Certificates.
Senior Credit Support Depletion Date: The date on which the aggregate
Class Certificate Balance of the Subordinate Certificates is reduced to zero.
Senior Percentage: With respect to any Distribution Date, the
percentage, carried six places rounded up, obtained by dividing the aggregate
Class Certificate Balance of the Senior Certificates (other than the Class A-PO
Certificates) immediately prior to such Distribution Date by the aggregate Class
Certificate Balance of all Classes of Certificates (other than the Class A-PO
Certificates) immediately prior to such Distribution Date.
Senior Prepayment Percentage: For any Distribution Date during the
five years beginning on the first Distribution Date, %. The Senior Prepayment
Percentage for any Distribution Date occurring on or after the fifth anniversary
of the first Distribution Date will, except as provided herein, be as follows:
for any Distribution Date in the first year thereafter, the Senior Percentage
plus % of the Subordinate Percentage for such Distribution Date; for any
Distribution Date in the second year thereafter, the Senior Percentage plus % of
the Subordinate Percentage for such Distribution Date; for any Distribution Date
in the third year thereafter, the Senior Percentage plus % of the Subordinate
Percentage for such Distribution Date; for any Distribution Date in the fourth
year thereafter, the Senior Percentage plus % of the Subordinate Percentage for
such Distribution Date; and for any Distribution Date in the fifth or later
years thereafter, the Senior Percentage for such Distribution Date (unless on
any of the foregoing Distribution Dates the Senior Percentage exceeds the
initial Senior Percentage, in which case the Senior Prepayment Percentage for
such Distribution Date will once
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again equal 100%). Notwithstanding the foregoing, no decrease in the Senior
Prepayment Percentage will occur unless both of the Senior Step Down Conditions
are satisfied.
Senior Principal Distribution Amount: As to any Distribution Date, the
sum of (i) the Senior Percentage of the applicable Non-PO Percentage of all
amounts described in clauses (a) through (d) of the definition of "Non-PO
Principal Amount" for such Distribution Date and (ii) the Senior Prepayment
Percentage of the applicable Non-PO Percentage of the amounts described in
clauses (e) and (f) of the definition of "Non-PO Principal Amount" for such
Distribution Date.
Senior Step Down Conditions: As of any Distribution Date as to which
any decrease in the Senior Prepayment Percentage applies, (i) the outstanding
principal balance of all Mortgage Loans (including, for this purpose, any
Mortgage Loans in foreclosure or any REO Property) delinquent 60 days or more
(averaged over the preceding six month period), as a percentage of the aggregate
Class Certificate Balance of the Subordinate Certificates (averaged over the
preceding six-month period), is not equal to or greater than 50% or (ii)
cumulative Realized Losses with respect to the Mortgage Loans as of the
applicable Distribution Date do not exceed the percentages of the Original
Subordinate Certificate Balance set forth below:
Percentage of
Original Subordinate
Distribution Date Occurring Certificate Balance
- --------------------------- -------------------
20 through 20 %
20 through 20 %
20 through 20 %
20 through 20 %
20 and thereafter %
Servicer: ________________, a ___________________, or its successor in
interest, in its capacity as servicer of the Mortgage Loans, or any successor
servicer appointed as herein provided.
Servicer Advance Date: As to any Distribution Date, 11:30 a.m.,
Eastern time, on the Business Day immediately preceding such Distribution Date.
Servicer Custodial Account: The separate Eligible Account or Accounts
created and maintained by the Servicer pursuant to Section 3.08(b).
Servicer's Certificate: The monthly report required by Section 4.01.
Servicing Advances: All customary, reasonable and necessary "out of
pocket" costs and expenses incurred in the performance by the Servicer of its
servicing obligations, including, but not limited to (i) the preservation,
restoration and protection of a Mortgaged Property, (ii) expenses reimbursable
to the Servicer pursuant to Section 3.14 and any enforcement or judicial
proceedings, including foreclosures, (iii) the management and liquidation of any
REO Property and (iv) compliance with the obligations under Section 3.12.
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Servicing Fee: With respect to each Mortgage Loan and Distribution
Date, the amount of the fee payable to the Servicer, which shall, for such
Distribution Date, be equal to one-twelfth of the product of the Servicing Fee
Rate with respect to such Mortgage Loan and the Stated Principal Balance of such
Mortgage Loan, subject to reduction as provided in Section 3.17. Such fee shall
be payable monthly, computed on the basis of the same Stated Principal Balance
and period respecting which any related interest payment on a Mortgage Loan is
computed. The Servicer's right to receive the Servicing Fee is limited to, and
payable solely from, the interest portion (including recoveries with respect to
interest from Liquidation Proceeds and other proceeds, to the extent permitted
by Section 3.11) of related Monthly Payments collected by the Servicer, or as
otherwise provided under Section 3.11.
Servicing Fee Rate: With respect to each Mortgage Loan, the per annum
rate equal to (i) the related Mortgage Interest Rate less (ii) the sum of % and
the Trustee Fee Rate; provided, however, that the Servicing Fee Rate will not be
less than % per annum with respect to any Mortgage Loan.
Servicing File: The items pertaining to a particular Mortgage Loan
referred to in Exhibit J hereto, and any additional documents required to be
added to the Servicing File pursuant to the Agreement.
Servicing Officer: Any officer of the Servicer involved in, or
responsible for, the administration and servicing of the Mortgage Loans whose
name appears on a list of servicing officers furnished to the Trustee by the
Servicer, as such list may from time to time be amended.
Shift Percentage: As to any Distribution Date, the percentage
indicated below:
Distribution Date Occurring In Shift Percentage
- ------------------------------ ----------------
20 through 20 ............................ %
20 through 20 ............................ %
20 through 20 ............................ %
20 through 20 ............................ %
20 through 20 ............................ %
20 and thereafter................................. %
Similar Law: As defined in Section 6.02(e).
Stated Principal Balance: As to any Mortgage Loan and date, the unpaid
principal balance of such Mortgage Loan as of the Due Date immediately preceding
such date as specified in the amortization schedule at the time relating thereto
(before any adjustment to such amortization schedule by reason of any moratorium
or similar waiver or grace period) after giving effect to any previous partial
Principal Prepayments and Liquidation Proceeds allocable to principal (other
than with respect to any Liquidated Mortgage Loan) and to the payment of
principal due on such Due Date and irrespective of any delinquency in payment by
the related Mortgagor, and after giving effect to any Deficient Valuation.
Subordinate Certificates: The Class B Certificates.
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Subordinate Percentage: As of any Distribution Date, 100% minus the
Senior Percentage for such Distribution Date.
Subordinate Prepayment Percentage: As to any Distribution Date, 100%
minus the Senior Prepayment Percentage for such Distribution Date.
Subordinate Principal Distribution Amount: With respect to any
Distribution Date, an amount equal to the sum of (i) the Subordinate Percentage
of the applicable Non-PO Percentage of all amounts described in clauses (a)
through (d) of the definition of "Non-PO Principal Amount" for such Distribution
Date and (ii) the Subordinate Prepayment Percentage of the applicable Non-PO
Percentage of the amounts described in clauses (e) and (f) of the definition of
"Non-PO Principal Amount" for such Distribution Date.
Subservicer: Any Person with which the Servicer has entered into a
Subservicing Agreement and which satisfies the requirements set forth therein.
Subservicing Agreement: Any subservicing agreement (which, in the
event the Subservicer is an affiliate of the Servicer, need not be in writing)
between the Servicer and any Subservicer relating to servicing and/or
administration of certain Mortgage Loans as provided in Section 3.02.
Substitute Mortgage Loan: A Mortgage Loan substituted for a Defective
Mortgage Loan which must, on the date of such substitution (i) have a Stated
Principal Balance, after deduction of the principal portion of the Monthly
Payment due in the month of substitution, not in excess of, and not more than
10% less than, the Stated Principal Balance of the Defective Mortgage Loan; (ii)
have a Net Mortgage Interest Rate equal to that of the Defective Mortgage Loan;
(iii) have a Loan-to-Value Ratio not higher than that of the Defective Mortgage
Loan; (iv) have a remaining term to maturity not greater than (and not more than
one year less than) that of the Defective Mortgage Loan; and (v) comply with
each Mortgage Loan representation and warranty set forth in the Sale Agreement
relating to the Defective Mortgage Loan. More than one Substitute Mortgage Loan
may be substituted for a Defective Mortgage Loan if such Substitute Mortgage
Loans meet the foregoing attributes in the aggregate.
Substitution Adjustment Amount: As defined in Section 2.02.
Tax Matters Person: Any person designated as "tax matters person" in
accordance with Section 5.06 and the manner provided under Treasury Regulation
ss. 1.860F-4(d) and Treasury Regulation ss. 301.6231(a)(7)-1.
Telerate page 3750: As defined in Section 5.09.
Treasury Regulations: The final and temporary regulations promulgated
under the Code by the U.S. Department of the Treasury.
Trust: The trust created by this Agreement.
Trust Estate: The corpus of the Trust created to the extent described
herein, consisting of the Mortgage Loans, such assets as shall from time to time
be identified as
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deposited in the Servicer Custodial Account or the Certificate Account, in
accordance with this Agreement, REO Property, the Primary Insurance Policies and
any other Required Insurance Policy.
Trustee: _____________________, and its successors-in-interest and, if
a successor trustee is appointed hereunder, such successor, as trustee.
Trustee Fee: As to any Distribution Date, an amount equal to
one-twelfth of the Trustee Fee Rate multiplied by the aggregate Stated Principal
Balance of the Mortgage Loans immediately following the Due Date in the month
preceding the month in which such Distribution Date occurs.
Trustee Fee Rate: With respect to each Mortgage Loan, ____% per annum.
Uncertificated Lower-Tier Interest: A regular interest in the
Lower-Tier REMIC which is held as an asset of the Upper-Tier REMIC and is
entitled to monthly distributions as provided in Section 5.02(a) hereof. Any of
the Class A-L1, Class A-L3, Class A-L4, Class A-LPO, Class A-LUR, Class A-LWIO,
Class B-L1, Class B-L2, Class B-L3, Class B-L4, Class B-L5 and Class B-L6
Interests are Uncertificated Lower-Tier Interests.
Underwriting Guidelines: The underwriting guidelines of .
Upper-Tier Certificate: Any one of the Class A Certificates (other
than the Class A-LR Certificate) and the Class B Certificates.
Upper-Tier Certificate Account: The separate Eligible Account
established and maintained by the Trustee pursuant to Section 3.08(f).
Upper-Tier REMIC: As defined in the Preliminary Statement, the assets
of which consist of the Uncertificated Lower-Tier Interests and such amounts as
shall from time to time be held in the Upper-Tier Certificate Account.
U.S. Person: A citizen or resident of the United States, a corporation
or partnership (unless, in the case of a partnership, Treasury Regulations are
adopted that provide otherwise) created or organized in or under the laws of the
United States, any state thereof or the District of Columbia, including an
entity treated as a corporation or partnership for federal income tax purposes,
an estate whose income is subject to United States federal income tax regardless
of its source, or a trust if a court within the United States is able to
exercise primary supervision over the administration of such trust, and one or
more such U.S. Persons have the authority to control all substantial decisions
of such trust (or, to the extent provided in applicable Treasury Regulations,
certain trusts in existence on August 20, 1996 which are eligible to elect to be
treated as U.S. Persons).
Voting Rights: The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. As of any date of
determination, (a) % of all Voting Rights shall be allocated to the Holders of
the Residual Certificates, (b) % of all Voting Rights shall be allocated to the
Holders of the Class A-5 Certificates, (c) % of all Voting Rights shall be
allocated to the Holders of the Class A-WIO Certificates and (d) the remaining
Voting Rights
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shall be allocated among Holders of the remaining Classes of Certificates in
proportion to the Certificate Balances of their respective Certificates on such
date. Section 1.02 Interest Calculations. All calculations of interest will be
made on a 360-day year consisting of twelve 30-day months. All dollar amounts
calculated hereunder shall be rounded to the nearest penny with one-half of one
penny being rounded down.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01 Conveyance of Mortgage Loans.
(a) The Depositor, concurrently with the execution and delivery
hereof, hereby sells, transfers, assigns, sets over and otherwise conveys to the
Trustee on behalf of the Trust for the benefit of the Certificateholders,
without recourse, all the right, title and interest of the Depositor in and to
the Mortgage Loans, including all interest and principal received on or with
respect to the Mortgage Loans (other than payments of principal and interest due
and payable on the Mortgage Loans on or before the Cut-Off Date). The foregoing
sale, transfer, assignment and set over does not and is not intended to result
in a creation of an assumption by the Trustee of any obligation of the Depositor
or any other Person in connection with the Mortgage Loans or any agreement or
instrument relating thereto, except as specifically set forth herein.
(b) In connection with such transfer and assignment, the Depositor has
delivered or caused to be delivered to the Trustee, for the benefit of the
Certificateholders, the following documents or instruments with respect to each
Mortgage Loan so assigned:
(i) the original Mortgage Note, endorsed by manual or facsimile
signature in the following form: "Pay to the order of , as Trustee, without
recourse," with all necessary intervening endorsements showing a complete
chain of endorsement from the originator to the Trustee (each such
endorsement being sufficient to transfer all right, title and interest of
the party so endorsing, as noteholder or assignee thereof, in and to that
Mortgage Note);
(ii) except as provided below, the original recorded Mortgage with
evidence of a recording thereon, or if any such Mortgage has not been
returned from the applicable recording office or has been lost, or if such
public recording office retains the original recorded Mortgage, a copy of
such Mortgage certified by the Depositor as being a true and correct copy
of the Mortgage;
(iii) subject to the provisos at the end of this paragraph, a duly
executed Assignment of Mortgage to " , as trustee for the holders of the
Wachovia Asset Securitization Issuance, LLC Mortgage Pass-Through
Certificates, Series 200 - Certificates" (which may be included in a
blanket assignment or assignments), together with, except as provided
below, originals of all interim recorded assignments of such mortgage or a
copy of such interim assignment certified by the Depositor as being a true
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and complete copy of the original recorded intervening assignments of
Mortgage (each such assignment, when duly and validly completed, to be in
recordable form and sufficient to effect the assignment of and transfer to
the assignee thereof, under the Mortgage to which the assignment relates);
provided that, if the related Mortgage has not been returned from the
applicable public recording office, such Assignment of Mortgage may exclude
the information to be provided by the recording office; and provided,
further, if the related Mortgage has been recorded in the name of Mortgage
Electronic Registration Systems, Inc. ("MERS") or its designee, no
Assignment of Mortgage in favor of the Trustee will be required to be
prepared or delivered and instead, the Servicer shall take all actions as
are necessary to cause the Trust to be shown as the owner of the related
Mortgage Loan on the records of MERS for purposes of the system of
recording transfers of beneficial ownership of mortgages maintained by
MERS;
(iv) the originals of all assumption, modification, consolidation or
extension agreements, if any, with evidence of recording thereon, if any;
(v) the original or duplicate original mortgagee title insurance
policy and all riders thereto;
(vi) the original of any guarantee executed in connection with the
Mortgage Note;
(vii) for each Mortgage Loan, if any, which is secured by a
residential long-term lease, a copy of the lease with evidence of recording
indicated thereon, or, if the lease is in the process of being recorded, a
photocopy of the lease, certified by an officer of the respective prior
owner of such Mortgage Loan or by the applicable title insurance company,
closing/settlement/escrow agent or company or closing attorney to be a true
and correct copy of the lease transmitted for recordation;
(viii) the original of any security agreement, chattel mortgage or
equivalent document executed in connection with the Mortgage; and
(ix) for each Mortgage Loan secured by Co-op Shares, the originals of
the following documents or instruments:
(A) The stock certificate;
(B) The stock power executed in blank;
(C) The executed proprietary lease;
(D) The executed recognition agreement;
(E) The executed assignment of recognition agreement, if any;
(F) The executed UCC-1 financing statement with evidence of
recording thereon; and
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(G) Executed UCC-3 financing statements or other appropriate UCC
financing statements required by state law, evidencing a
complete and unbroken line from the mortgagee to the Trustee
with evidence of recording thereon (or in a form suitable
for recordation).
provided, however, that on the Closing Date, with respect to item (iii), the
Depositor has delivered to the Trustee a copy of such Assignment of Mortgage in
blank and has caused the Servicer to retain the completed Assignment of Mortgage
for recording as described below, unless such Mortgage has been recorded in the
name of MERS or its designee. In addition, if the Depositor is unable to deliver
or cause the delivery of any original Mortgage Note due to the loss of such
original Mortgage Note, the Depositor may deliver a copy of such Mortgage Note,
together with a lost note affidavit, and shall thereby be deemed to have
satisfied the document delivery requirements of this Section 2.01(b). As set
forth on Exhibit L attached hereto is a list of all states where recordation is
required by either Rating Agency to obtain the initial ratings of the
Certificates. The Trustee may rely and shall be protected in relying upon the
information contained in such Exhibit L.
If in connection with any Mortgage Loans, the Depositor cannot deliver
(A) the Mortgage, (B) all interim recorded assignments, (C) all assumption,
modification, consolidation or extension agreements, if any, or (D) the lender's
title policy (together with all riders thereto) satisfying the requirements of
clause (ii), (iii), (iv) or (v) above, respectively, concurrently with the
execution and delivery hereof because such document or documents have not been
returned from the applicable public recording office in the case of clause (ii),
(iii) or (iv) above, or because the title policy has not been delivered to
either the Servicer or the Depositor by the applicable title insurer in the case
of clause (v) above, the Depositor shall promptly deliver or cause to be
delivered to the Trustee or the Custodian on behalf of the Trustee, in the case
of clause (ii), (iii) or (iv) above, such Mortgage, such interim assignment or
such assumption, modification, consolidation or extension agreement, as the case
may be, with evidence of recording indicated thereon upon receipt thereof from
the public recording office, but in no event shall any such delivery of any such
documents or instruments be made later than one year following the Closing Date,
unless, in the case of clause (ii), (iii) or (iv) above, there has been a
continuing delay at the applicable recording office or, in the case of clause
(v), there has been a continuing delay at the applicable insurer and the
Depositor has delivered the Officer's Certificate to such effect to the Trustee.
The Depositor shall forward or cause to be forwarded to the Trustee (1) from
time to time additional original documents evidencing an assumption or
modification of a Mortgage Loan and (2) any other documents required to be
delivered by the Depositor or the Servicer to the Trustee or the Custodian on
the Trustee's behalf. In the event that the original Mortgage is not delivered
and in connection with the payment in full of the related Mortgage Loan the
public recording office requires the presentation of a "lost instruments
affidavit and indemnity" or any equivalent document, because only a copy of the
Mortgage can be delivered with the instrument of satisfaction or reconveyance,
the Servicer shall prepare, execute and deliver or cause to be prepared,
executed and delivered, on behalf of the Trust, such a document to the public
recording office.
As promptly as practicable subsequent to such transfer and assignment,
and in any event, within 30 days thereafter, the Servicer shall (except for any
Mortgage which has been recorded in the name of MERS or its designee) (I) cause
each Assignment of Mortgage to be in
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proper form for recording in the appropriate public office for real property
records within 30 days of the Closing Date and (II) at the Depositor's expense,
cause to be delivered for recording in the appropriate public office for real
property records the Assignments of the Mortgages to the Trustee, except that,
with respect to any Assignment of a Mortgage as to which the Servicer has not
received the information required to prepare such assignment in recordable form,
the Servicer's obligation to do so and to deliver the same for such recording
shall be as soon as practicable after receipt of such information and in any
event within 30 days after the receipt thereof and, no recording of an
Assignment of Mortgage will be required in a state if either (i) the Depositor
furnishes to the Trustee an unqualified Opinion of Counsel reasonably acceptable
to the Trustee to the effect that recordation of such assignment is not
necessary under applicable state law to preserve the Trustee's interest in the
related Mortgage Loan against the claim of any subsequent transferee of such
Mortgage Loan or any successor to, or creditor of, the Depositor or the
originator of such Mortgage Loan or (ii) the recordation of an Assignment of
Mortgage in such state is not required by either Rating Agency in order to
obtain the initial ratings on the Certificates on the Closing Date.
In the case of Mortgage Loans that have been prepaid in full as of the
Closing Date, the Depositor, in lieu of delivering the above documents to the
Trustee, or the Custodian on the Trustee's behalf, will cause the Servicer to
deposit in the Servicer Custodial Account the portion of such payment that is
required to be deposited in the Servicer Custodial Account pursuant to Section
3.08.
Section 2.02 Acceptance by the Trustee of the Mortgage Loans. Subject
to the provisions of the following paragraph, the Trustee declares that it, or
the Custodian as its agent, will hold the documents referred to in Section 2.01
and the other documents delivered to it constituting the Mortgage Files, and
that it will hold such other assets as are included in the Trust Estate, in
trust for the exclusive use and benefit of all present and future
Certificateholders.
Within 90 days after the execution and delivery of this Agreement, the
Trustee shall review, or cause the Custodian to review, the Mortgage Files in
its possession. If, in the course of such review, the Trustee or the Custodian
finds any document constituting a part of a Mortgage File which does not meet
the requirements of Section 2.01 or is omitted from such Mortgage File, the
Trustee shall promptly so notify the Servicer and the Depositor, or shall cause
the Custodian to promptly so notify the Servicer and the Depositor. In
performing any such review, the Trustee or the Custodian may conclusively rely
on the purported genuineness of any such document and any signature thereon. It
is understood that the scope of the Trustee's or the Custodian's review of the
Mortgage Files is limited solely to confirming that the documents listed in
Section 2.01 have been received and further confirming that any and all
documents delivered pursuant to Section 2.01 appear on their face to have been
executed and relate to the Mortgage Loans identified in the Mortgage Loan
Schedule. Neither the Trustee nor the Custodian shall have any responsibility
for determining whether any document is valid and binding, whether the text of
any assignment or endorsement is in proper or recordable form, whether any
document has been recorded in accordance with the requirements of any applicable
jurisdiction, or whether a blanket assignment is permitted in any applicable
jurisdiction. The Depositor hereby covenants and agrees that it will promptly
correct or cure such defect within 90 days from the date it was so notified of
such defect and, if the Depositor does not correct or cure such defect within
such period, the Depositor will either (a) substitute for the related Mortgage
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Loan a Substitute Mortgage Loan, which substitution shall be accomplished in the
manner and subject to the conditions set forth below or (b) purchase such
Mortgage Loan from the Trustee at the Repurchase Price for such Mortgage Loan;
provided, however, that in no event shall such a substitution occur more than
two years from the Closing Date; provided, further, that such substitution or
repurchase shall occur within 90 days of when such defect was discovered if such
defect will cause the Mortgage Loan not to be a "qualified mortgage" within the
meaning of Section 860G(a)(3) of the Code.
With respect to each Substitute Mortgage Loan the Depositor shall
deliver to the Trustee, for the benefit of the Certificateholders, the Mortgage
Note, the Mortgage, the related Assignment of Mortgage (except for any Mortgage
which has been recorded in the name of MERS or its designee), and such other
documents and agreements as are otherwise required by Section 2.01, with the
Mortgage Note endorsed and the Mortgage assigned as required by Section 2.01. No
substitution is permitted to be made in any calendar month after the
Determination Date for such month. Monthly Payments due with respect to any such
Substitute Mortgage Loan in the month of substitution shall not be part of the
Trust Estate and will be retained by the Depositor. For the month of
substitution, distributions to Certificateholders will include the Monthly
Payment due for such month on any Defective Mortgage Loan for which the
Depositor has substituted a Substitute Mortgage Loan.
The Servicer shall amend the Mortgage Loan Schedule for the benefit of
the Certificateholders to reflect the removal of each Mortgage Loan that has
become a Defective Mortgage Loan and the substitution of the Substitute Mortgage
Loan or Loans and the Servicer shall deliver the amended Mortgage Loan Schedule
to the Trustee and the Custodian. Upon such substitution, each Substitute
Mortgage Loan shall be subject to the terms of this Agreement in all respects,
and the Depositor shall be deemed to have made to the Trustee with respect to
such Substitute Mortgage Loan, as of the date of substitution, the
representations and warranties made pursuant to Section 2.04. Upon any such
substitution and the deposit to the Servicer Custodial Account of any required
Substitution Adjustment Amount (as described in the next paragraph) and receipt
of a Request for Release, the Trustee shall release, or shall direct the
Custodian to release, the Mortgage File relating to such Defective Mortgage Loan
to the Depositor and shall execute and deliver at the Depositor's direction such
instruments of transfer or assignment prepared by the Depositor, in each case
without recourse, as shall be necessary to vest title in the Depositor, or its
designee, to the Trustee's interest in any Defective Mortgage Loan substituted
for pursuant to this Section 2.02.
For any month in which the Depositor substitutes one or more
Substitute Mortgage Loans for one or more Defective Mortgage Loans, the amount
(if any) by which the aggregate principal balance of all such Substitute
Mortgage Loans as of the date of substitution is less than the aggregate Stated
Principal Balance of all such Defective Mortgage Loans (after application of the
principal portion of the Monthly Payments due in the month of substitution) (the
"Substitution Adjustment Amount") plus an amount equal to the aggregate of any
unreimbursed Advances with respect to such Defective Mortgage Loans shall be
deposited into the Certificate Account by the Depositor on or before the
Remittance Date for the Distribution Date in the month succeeding the calendar
month during which the related Mortgage Loan is required to be purchased or
replaced hereunder.
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The Trustee shall retain or shall cause the Custodian to retain
possession and custody of each Mortgage File in accordance with and subject to
the terms and conditions set forth herein. The Servicer shall promptly deliver
to the Trustee, upon the execution or, in the case of documents requiring
recording, receipt thereof, the originals of such other documents or instruments
constituting the Mortgage File as come into the Servicer's possession from time
to time.
It is understood and agreed that the obligation of the Depositor to
substitute for or to purchase any Mortgage Loan which does not meet the
requirements of Section 2.01 shall constitute the sole remedy respecting such
defect available to the Trustee and any Certificateholder against the Depositor.
The Trustee or the Custodian, on behalf of the Trustee, shall be under
no duty or obligation (i) to inspect, review or examine any such documents,
instruments, certificates or other papers to determine that they are genuine,
enforceable, or appropriate for the represented purpose or that they are other
than what they purport to be on their face or (ii) to determine whether any
Mortgage File should include any of the documents specified in Section
2.01(b)(iv), (vi), (vii) and (viii).
Section 2.03 Representations, Warranties and Covenants of the
Servicer.
(i) The Servicer hereby makes the following representations
and warranties to the Depositor and the Trustee, as of the Closing
Date: (i) The Servicer is a national banking association duly
organized, validly existing, and in good standing under the federal
laws of the United States of America and has all licenses necessary to
carry on its business as now being conducted and is licensed,
qualified and in good standing in each of the states where a Mortgaged
Property is located if the laws of such state require licensing or
qualification in order to conduct business of the type conducted by
the Servicer. The Servicer has power and authority to execute and
deliver this Agreement and to perform in accordance herewith; the
execution, delivery and performance of this Agreement (including all
instruments of transfer to be delivered pursuant to this Agreement) by
the Servicer and the consummation of the transactions contemplated
hereby have been duly and validly authorized. This Agreement, assuming
due authorization, execution and delivery by the other parties hereto,
evidences the valid, binding and enforceable obligation of the
Servicer, subject to applicable law except as enforceability may be
limited by (A) bankruptcy, insolvency, liquidation, receivership,
moratorium, reorganization or other similar laws affecting the
enforcement of the rights of creditors and (B) general principles of
equity, whether enforcement is sought in a proceeding in equity or at
law. All requisite corporate action has been taken by the Servicer to
make this Agreement valid and binding upon the Servicer in accordance
with its terms.
(ii) No consent, approval, authorization or order is required
for the transactions contemplated by this Agreement from any court,
governmental agency or body, or federal or state regulatory authority
having jurisdiction over the Servicer is required or, if
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required, such consent, approval, authorization or order has been or
will, prior to the Closing Date, be obtained.
(iii) The consummation of the transactions contemplated by
this Agreement are in the ordinary course of business of the Servicer
and will not result in the breach of any term or provision of the
charter or by-laws of the Servicer or result in the breach of any term
or provision of, or conflict with or constitute a default under or
result in the acceleration of any obligation under, any agreement,
indenture or loan or credit agreement or other instrument to which the
Servicer or its property is subject, or result in the violation of any
law, rule, regulation, order, judgment or decree to which the Servicer
or its property is subject.
(iv) There is no action, suit, proceeding or investigation
pending or, to the best knowledge of the Servicer, threatened against
the Servicer which, either individually or in the aggregate, would
result in any material adverse change in the business, operations,
financial condition, properties or assets of the Servicer, or in any
material impairment of the right or ability of the Servicer to carry
on its business substantially as now conducted or which would draw
into question the validity of this Agreement or the Mortgage Loans or
of any action taken or to be taken in connection with the obligations
of the Servicer contemplated herein, or which would materially impair
the ability of the Servicer to perform under the terms of this
Agreement.
The representations and warranties made pursuant to this
Section 2.03 shall survive delivery of the respective Mortgage Files
to the Trustee for the benefit of the Certificateholders.
Section 2.04 Representations and Warranties of the Depositor as to the
Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee with
respect to the Mortgage Loans or each Mortgage Loan, as the case may be, as of
the date hereof or such other date set forth herein that as of the Closing Date:
(i) The information set forth in the Mortgage Loan Schedule
is true and correct in all material respects.
(ii) There are no delinquent taxes, ground rents,
governmental assessments, insurance premiums, leasehold payments,
including assessments payable in future installments or other
outstanding charges affecting the lien priority of the related
Mortgaged Property.
(iii) The terms of the Mortgage Note and the Mortgage have
not been impaired, waived, altered or modified in any respect, except
by written instruments, recorded in the applicable public recording
office if necessary to maintain the lien priority of the Mortgage, and
which have been delivered to the Trustee; the substance of any such
waiver, alteration or modification has been approved by the insurer
under the Primary Insurance Policy, if any, the title insurer, to the
extent required by the related policy, and is reflected on the
Mortgage Loan Schedule. No instrument of waiver, alteration or
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modification has been executed, and no Mortgagor has been released, in
whole or in part, except in connection with an assumption agreement
approved by the insurer under the Primary Insurance Policy, if any,
the title insurer, to the extent required by the policy, and which
assumption agreement has been delivered to the Trustee.
(iv) The Mortgage Note and the Mortgage are not subject to
any right of rescission, set-off, counterclaim or defense, including
the defense of usury, nor will the operation of any of the terms of
the Mortgage Note and the Mortgage, or the exercise of any right
thereunder, render either the Mortgage Note or the Mortgage
unenforceable, in whole or in part, or subject to any right of
rescission, set-off, counterclaim or defense, including the defense of
usury and no such right of rescission, set-off, counterclaim or
defense has been asserted with respect thereto.
(v) All buildings upon the Mortgaged Property are insured by
an insurer generally acceptable to prudent mortgage lending
institutions against loss by fire, hazards of extended coverage and
such other hazards as are customary in the area the Mortgaged Property
is located, pursuant to insurance policies conforming to the
requirements of Customary Servicing Procedures and this Agreement. All
such insurance policies contain a standard mortgagee clause naming the
originator of the Mortgage Loan, its successors and assigns as
mortgagee and all premiums thereon have been paid. If the Mortgaged
Property is in an area identified on a flood hazard map or flood
insurance rate map issued by the Federal Emergency Management Agency
as having special flood hazards (and such flood insurance has been
made available), a flood insurance policy meeting the requirements of
the current guidelines of the Federal Insurance Administration is in
effect which policy conforms to the requirements of FNMA or FHLMC. The
Mortgage obligates the Mortgagor thereunder to maintain all such
insurance at the Mortgagor's cost and expense, and on the Mortgagor's
failure to do so, authorizes the holder of the Mortgage to maintain
such insurance at Mortgagor's cost and expense and to seek
reimbursement therefor from the Mortgagor.
(vi) Any and all requirements of any federal, state or local
law including, without limitation, usury, truth in lending, real
estate settlement procedures, consumer credit protections, equal
credit opportunity or disclosure laws applicable to the origination
and servicing of Mortgage Loan have been complied with.
(vii) The Mortgage has not been satisfied, canceled,
subordinated or rescinded, in whole or in part (other than as to
Principal Prepayments in full which may have been received prior to
the Closing Date), and the Mortgaged Property has not been released
from the lien of the Mortgage, in whole or in part, nor has any
instrument been executed that would effect any such satisfaction,
cancellation, subordination, rescission or release.
(viii) The Mortgage is a valid, existing and enforceable
first lien on the Mortgaged Property, including all improvements on
the Mortgaged Property subject only to (A) the lien of current real
property taxes and assessments not yet due and payable, (B) covenants,
conditions and restrictions, rights of way, easements and other
matters of the public record as of the date of recording being
acceptable to mortgage lending institutions generally and specifically
referred to in the lender's title insurance policy delivered to the
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originator of the Mortgage Loan and which do not adversely affect the
Appraised Value of the Mortgaged Property, (C) if the Mortgaged
Property consists of Co-op Shares, any lien for amounts due to the
cooperative housing corporation for unpaid assessments or charges or
any lien of any assignment of rents or maintenance expenses secured by
the real property owned by the cooperative housing corporation, and
(D) other matters to which like properties are commonly subject which
do not materially interfere with the benefits of the security intended
to be provided by the Mortgage or the use, enjoyment, value or
marketability of the related Mortgaged Property. Any security
agreement, chattel mortgage or equivalent document related to and
delivered in connection with the Mortgage Loan establishes and creates
a valid, existing and enforceable first lien and first priority
security interest on the property described therein and the Depositor
has the full right to sell and assign the same to the Trustee.
(ix) The Mortgage Note and the related Mortgage are genuine
and each is the legal, valid and binding obligation of the maker
thereof, enforceable in accordance with its terms except as
enforceability may be limited by (A) bankruptcy, insolvency,
liquidation, receivership, moratorium, reorganization or other similar
laws affecting the enforcement of the rights of creditors and (B)
general principles of equity, whether enforcement is sought in a
proceeding in equity or at law.
(x) All parties to the Mortgage Note and the Mortgage had
legal capacity to enter into the Mortgage Loan and to execute and
deliver the Mortgage Note and the Mortgage, and the Mortgage Note and
the Mortgage have been duly and properly executed by such parties.
(xi) The proceeds of the Mortgage Loan have been fully
disbursed to or for the account of the Mortgagor and there is no
obligation for the Mortgagee to advance additional funds thereunder
and any and all requirements as to completion of any on-site or
off-site improvements and as to disbursements of any escrow funds
therefor have been complied with. All costs fees and expenses incurred
in making or closing the Mortgage Loan and the recording of the
Mortgage have been paid, and the Mortgagor is not entitled to any
refund of any amounts paid or due to the Mortgagee pursuant to the
Mortgage Note or Mortgage.
(xii) To the best of the Depositor's knowledge, all parties
which have had any interest in the Mortgage Loan, whether as
mortgagee, assignee, pledgee or otherwise, are (or, during the period
in which they held and disposed of such interest, were) in compliance
with any and all applicable "doing business" and licensing
requirements of the laws of the state wherein the Mortgaged Property
is located.
(xiii) The Mortgage Loan is covered by an ALTA lender's
title insurance policy, acceptable to FNMA or FHLMC, issued by a title
insurer acceptable to FNMA or FHLMC and qualified to do business in
the jurisdiction where the Mortgaged Property is located, insuring
(subject to the exceptions contained in (viii)(A) and (B) above) the
Seller, its successors and assigns as to the first priority lien of
the Mortgage in the original principal amount of the Mortgage Loan.
The Depositor is the sole insured of such lender's title insurance
policy, and such lender's title insurance policy is in full force
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and effect and will be in full force and effect upon the consummation
of the transactions contemplated by this Agreement. No claims have
been made under such lender's title insurance policy, and the
Depositor has not done, by act or omission, anything which would
impair the coverage of such lender's title insurance policy.
(xiv) There is no default, breach, violation or event of
acceleration existing under the Mortgage or the Mortgage Note and no
event which, with the passage of time or with notice and the
expiration of any grace or cure period, would constitute a default,
breach, violation or event of acceleration, and the Seller has not
waived any default, breach, violation or event of acceleration.
(xv) As of the date of origination of the Mortgage Loan,
there had been no mechanics' or similar liens or claims filed for
work, labor or material (and no rights are outstanding that under law
could give rise to such lien) affecting the relating Mortgaged
Property which are or may be liens prior to, or equal or coordinate
with, the lien of the related Mortgage.
(xvi) All improvements which were considered in determining
the Appraised Value of the related Mortgaged Property lay wholly
within the boundaries and building restriction lines of the Mortgaged
Property, and no improvements on adjoining properties encroach upon
the Mortgaged Property.
(xvii) The Mortgage Loan was originated by a commercial bank
or similar banking institution which is supervised and examined by a
federal or state authority, or by a mortgagee approved by the
Secretary of HUD.
(xviii) Principal payments on the Mortgage Loan commenced no
more than sixty days after the proceeds of the Mortgaged Loan were
disbursed. The Mortgage Loans are 30-year fixed rate mortgage loans
having an original term to maturity of not more than 30 years, with
interest payable in arrears on the first day of the month. Each
Mortgage Note requires a monthly payment which is sufficient to fully
amortize the original principal balance over the original term thereof
and to pay interest at the related Mortgage Interest Rate. The
Mortgage Note does not permit negative amortization.
(xix) There is no proceeding pending or, to the Depositor's
knowledge, threatened for the total or partial condemnation of the
Mortgaged Property and such property is in good repair and is
undamaged by waste, fire, earthquake or earth movement, windstorm,
flood, tornado or other casualty, so as to affect adversely the value
of the Mortgaged Property as security for the Mortgage Loan or the use
for which the premises were intended.
(xx) The Mortgage and related Mortgage Note contain
customary and enforceable provisions such as to render the rights and
remedies of the holder thereof adequate for the realization against
the Mortgaged Property of the benefits of the security provided
thereby, including (A) in the case of a Mortgage designated as a deed
of trust, by trustee's sale, and (B) otherwise by judicial
foreclosure. To the best of the Depositor's knowledge, following the
date of origination of the Mortgage Loan, the
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Mortgaged Property has not been subject to any bankruptcy proceeding
or foreclosure proceeding and the Mortgagor has not filed for
protection under applicable bankruptcy laws. There is no homestead or
other exemption or right available to the Mortgagor or any other
person which would interfere with the right to sell the Mortgaged
Property at a trustee's sale or the right to foreclose the Mortgage.
(xxi) The Mortgage Note and Mortgage are on forms acceptable
to FNMA or FHLMC.
(xxii) The Mortgage Note is not and has not been secured by
any collateral except the lien of the corresponding Mortgage on the
Mortgaged Property and the security interest of any applicable
security agreement or chattel mortgage referred to in (viii) above.
(xxiii) The Mortgage File contains an appraisal of the
related Mortgaged Property, in a form acceptable to FNMA or FHLMC and
such appraisal complies with the requirements of FIRREA, and was made
and signed, prior to the approval of the Mortgage Loan application, by
a Qualified Appraiser.
(xxiv) In the event the Mortgage constitutes a deed of
trust, a trustee, duly qualified under applicable law to serve as
such, has been properly designated and currently so serves, and no
fees or expenses are or will become payable by the Trustee to the
trustee under the deed of trust, except in connection with a trustee's
sale after default by the Mortgagor.
(xxv) No Mortgage Loan is a graduated payment mortgage loan,
no Mortgage Loan has a shared appreciation or other contingent
interest feature, and no Mortgage Loan contains any "buydown"
provision.
(xxvi) The Mortgagor has received all disclosure materials
required by applicable law with respect to the making of mortgage
loans of the same type as the Mortgage Loan and rescission materials
required by applicable law if the Mortgage Loan is a Refinance
Mortgage Loan.
(xxvii) Each Mortgage Loan with a Loan-to-Value Ratio at
origination in excess of 80% will be subject to a Primary Insurance
Policy, issued by an insurer acceptable to FNMA or FHLMC, which
insures that portion of the Mortgage Loan in excess of the portion of
the Appraised Value of the Mortgaged Property required by FNMA. All
provisions of such Primary Insurance Policy have been and are being
complied with, such policy is in full force and effect, and all
premiums due thereunder have been paid. Any Mortgage subject to any
such Primary Insurance Policy obligates the Mortgagor thereunder to
maintain such insurance and to pay all premiums and charges in
connection therewith at least until Loan-to-Value Ratio of such
Mortgage Loan is reduced to less than 80%. The Mortgage Interest Rate
for the Mortgage Loan does not include any such insurance premium.
(xxviii) To the best of the Depositor's knowledge as of the
date of origination of the Mortgage Loan, (A) the Mortgaged Property
is lawfully occupied under applicable
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law, (B) all inspections, licenses and certificates required to be
made or issued with respect to all occupied portions of the Mortgaged
Property and, with respect to the use and occupancy of the same,
including but not limited to certificates of occupancy, have been made
or obtained from the appropriate authorities and (C) no improvement
located on or part of the Mortgaged Property is in violation of any
zoning law or regulation.
(xxix) The Assignment of Mortgage (except with respect to
any Mortgage that has been recorded in the name of MERS or its
designee) is in recordable form and is acceptable for recording under
the laws of the jurisdiction in which the Mortgaged Property is
located.
(xxx) All payments required to be made prior to the Cut-Off
Date for such Mortgage Loan under the terms of the Mortgage Note have
been made and no Mortgage Loan has been more than 30 days delinquent
more than once in the twelve month period immediately prior to the
Cut-Off Date.
(xxxi) With respect to each Mortgage Loan, the Depositor or
Servicer is in possession of a complete Mortgage File except for the
documents which have been delivered to the Trustee or which have been
submitted for recording and not yet returned.
(xxxii) Immediately prior to the transfer and assignment
contemplated herein, the Depositor was the sole owner and holder of
the Mortgage Loans. The Mortgage Loans were not assigned or pledged by
the Depositor and the Depositor had good and marketable title thereto,
and the Depositor had full right to transfer and sell the Mortgage
Loans to the Trustee free and clear of any encumbrance, participation
interest, lien, equity, pledge, claim or security interest and had
full right and authority subject to no interest or participation in,
or agreement with any other party to sell or otherwise transfer the
Mortgage Loans.
(xxxiii) Any future advances made prior to the Cut-Off Date
have been consolidated with the outstanding principal amount secured
by the Mortgage, and the secured principal amount, as consolidated,
bears a single interest rate and single repayment term. The lien of
the Mortgage securing the consolidated principal amount is expressly
insured as having first lien priority by a title insurance policy, an
endorsement to the policy insuring the mortgagee's consolidated
interest or by other title evidence acceptable to FNMA and FHLMC. The
consolidated principal amount does not exceed the original principal
amount of the Mortgage Loan.
(xxxiv) The Mortgage Loan was underwritten in accordance
with the applicable Underwriting Guidelines in effect at the time of
origination with exceptions thereto exercised in a reasonable manner.
(xxxv) If the Mortgage Loan is secured by a long-term
residential lease, (1) the lessor under the lease holds a fee simple
interest in the land; (2) the terms of such lease expressly permit the
mortgaging of the leasehold estate, the assignment of the lease
without the lessor's consent and the acquisition by the holder of the
Mortgage of the rights of the lessee upon foreclosure or assignment in
lieu of foreclosure or provide the
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holder of the Mortgage with substantially similar protections; (3) the
terms of such lease do not (a) allow the termination thereof upon the
lessee's default without the holder of the Mortgage being entitled to
receive written notice of, and opportunity to cure, such default, (b)
allow the termination of the lease in the event of damage or
destruction as long as the Mortgage is in existence, (c) prohibit the
holder of the Mortgage from being insured (or receiving proceeds of
insurance) under the hazard insurance policy or policies relating to
the Mortgaged Property or (d) permit any increase in the rent other
than pre-established increases set forth in the lease; (4) the
original term of such lease in not less than 15 years; (5) the term of
such lease does not terminate earlier than five years after the
maturity date of the Mortgage Note; and (6) the Mortgaged Property is
located in a jurisdiction in which the use of leasehold estates in
transferring ownership in residential properties is a widely accepted
practice.
(xxxvi) The Mortgaged Property is located in the state
identified in the Mortgage Loan Schedule and consists of a parcel of
real property with a detached single family residence erected thereon,
or a two- to four-family dwelling, or an individual condominium unit,
or an individual unit in a planned unit development, or, in the case
of Mortgage Loans secured by Co-op Shares, leases or occupancy
agreements; provided, however, that any condominium project or planned
unit development generally conforms with the applicable Underwriting
Guidelines regarding such dwellings, and no residence or dwelling is a
mobile home or a manufactured dwelling.
(xxxvii) The Depositor used no adverse selection procedures
in selecting the Mortgage Loan for inclusion in the Trust Estate.
(xxxviii) Each Mortgage Loan is a "qualified mortgage" within Section
860G(a)(3) of the Code. (xxxix) With respect to each Mortgage where a
lost note affidavit has been delivered to the Trustee in place of the
related Mortgage Note, the related Mortgage Note is no longer in
existence.
Notwithstanding the foregoing, no representations or warranties are
made by the Depositor as to the environmental condition of any Mortgaged
Property; the absence, presence or effect of hazardous wastes or hazardous
substances on any Mortgaged Property; any casualty resulting from the presence
or effect of hazardous wastes or hazardous substances on, near or emanating from
any Mortgaged Property; the impact on Certificateholders of any environmental
condition or presence of any hazardous substance on or near any Mortgaged
Property; or the compliance of any Mortgaged Property with any environmental
laws, nor is any agent, Person or entity otherwise affiliated with the Depositor
authorized or able to make any such representation, warranty or assumption of
liability relative to any Mortgaged Property. In addition, no representations or
warranties are made by the Depositor with respect to the absence or effect of
fraud in the origination of any Mortgage Loan.
It is understood and agreed that the representations and warranties
set forth in this Section 2.04 shall survive delivery of the respective Mortgage
Files to the Trustee or the
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Custodian and shall inure to the benefit of the Trustee, notwithstanding any
restrictive or qualified endorsement or assignment.
Upon discovery by either the Depositor, the Servicer, the Trustee or
the Custodian that any of the representations and warranties set forth in this
Section 2.04 is not accurate (referred to herein as a "breach") and that such
breach materially and adversely affects the interests of the Certificateholders
in the related Mortgage Loan, the party discovering such breach shall give
prompt written notice to the other parties (any Custodian being so obligated
under a Custodial Agreement); provided that any such breach that causes the
Mortgage Loan not to be a "qualified mortgage" within the meaning of Section
860G(a)(3) of the Code shall be deemed to materially and adversely affect the
interests of the Certificateholders. Within 90 days of its discovery or its
receipt of notice of any such breach, the Depositor shall cure such breach in
all material respects or shall either (i) repurchase the Mortgage Loan or any
property acquired in respect thereof from the Trustee at a price equal to the
Repurchase Price or (ii) if within two years of the Closing Date, substitute for
such Mortgage Loan in the manner described in Section 2.02; provided that if the
breach would cause the Mortgage Loan to be other than a "qualified mortgage" as
defined in Section 860G(a)(3) of the Code, any such repurchase or substitution
must occur within 90 days from the date the breach was discovered. The
Repurchase Price of any repurchase described in this paragraph and the
Substitution Adjustment Amount, if any, shall be deposited in the Certificate
Account. It is understood and agreed that the obligation of the Depositor to
repurchase or substitute for any Mortgage Loan or Mortgaged Property as to which
such a breach has occurred and is continuing shall constitute the sole remedy
respecting such breach available to Certificateholders, or to the Trustee on
behalf of Certificateholders, and such obligation shall survive until
termination of the Trust hereunder.
Section 2.05 Designation of Interests in the REMIC. The Depositor
hereby designates the Classes of Class A Certificates (other than the Class A-R
and Class A-LR Certificates) and the Classes of Class B Certificates as classes
of "regular interests" and the Class A-R Certificate as the single class of
"residual interest" in the Upper-Tier REMIC for the purposes of Code Sections
860G(a)(1) and 860G(a)(2), respectively. The Depositor hereby further designates
the Class A-L1 Interest, Class A-L3 Interest, Class A-L4 Interest, Class A-LPO
Interest, Class A-LUR Interest, Class A-LWIO Interest, Class B-L1 Interest,
Class B-L2 Interest, Class B-L3 Interest, Class B-L4 Interest, Class B-L5
Interest and Class B-L6 Interest as classes of "regular interests" and the Class
A-LR Certificate as the single class of "residual interest" in the Lower-Tier
REMIC for the purposes of Code Sections 860G(a)(1) and 860G(a)(2), respectively.
Section 2.06 Designation of Start-up Day. The Closing Date is hereby
designated as the "start-up day" of each of the Upper-Tier REMIC and Lower-Tier
REMIC within the meaning of Section 860G(a)(9) of the Code.
Section 2.07 REMIC Certificate Maturity Date. Solely for purposes of
satisfying Section 1.860G-1(a)(4)(iii) of the Treasury Regulations, the "latest
possible maturity date" of the regular interests in the Upper-Tier REMIC and
Lower-Tier REMIC is [______], 20 .
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Section 2.08 Execution and Delivery of Certificates. The Trustee (i)
acknowledges the issuance of and hereby declares that it holds the
Uncertificated Lower-Tier Interests on behalf of the Upper-Tier REMIC and the
Certificateholders and (ii) has executed and delivered to or upon the order of
the Depositor, in exchange for the Mortgage Loans and Uncertificated Lower-Tier
Interests together with all other assets included in the definition of "Trust
Estate," receipt of which is hereby acknowledged, Certificates in authorized
denominations which, together with the Uncertificated Lower-Tier Interests,
evidence ownership of the entire Trust Estate.
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01 Servicer to Service Mortgage Loans. For and on behalf of
the Certificateholders, the Servicer shall service and administer the Mortgage
Loans, all in accordance with the terms of this Agreement, Customary Servicing
Procedures, applicable law and the terms of the Mortgage Notes and Mortgages. In
connection with such servicing and administration, the Servicer shall have full
power and authority, acting alone and/or through Subservicers as provided in
Section 3.02, to do or cause to be done any and all things that it may deem
necessary or desirable in connection with such servicing and administration
including, but not limited to, the power and authority, subject to the terms
hereof, (a) to execute and deliver, on behalf of the Certificateholders and the
Trustee, customary consents or waivers and other instruments and documents, (b)
to consent, with respect to the Mortgage Loans it services, to transfers of any
Mortgaged Property and assumptions of the Mortgage Notes and related Mortgages
(but only in the manner provided in this Agreement), (c) to collect any
Insurance Proceeds and other Liquidation Proceeds relating to the Mortgage Loans
it services, and (d) to effectuate foreclosure or other conversion of the
ownership of the Mortgaged Property securing any Mortgage Loan it services. The
Servicer shall represent and protect the interests of the Trust in the same
manner as it protects its own interests in mortgage loans in its own portfolio
in any claim, proceeding or litigation regarding a Mortgage Loan and shall not
make or permit any modification, waiver or amendment of any term of any Mortgage
Loan, except as provided pursuant to Section 3.21. Without limiting the
generality of the foregoing, the Servicer, in its own name or in the name of any
Subservicer or the Depositor and the Trustee, is hereby authorized and empowered
by the Depositor and the Trustee, when the Servicer or any Subservicer, as the
case may be, believes it appropriate in its reasonable judgment, to execute and
deliver, on behalf of the Trustee, the Depositor, the Certificateholders or any
of them, any and all instruments of satisfaction or cancellation, or of partial
or full release or discharge, and all other comparable instruments, with respect
to the Mortgage Loans it services, and with respect to the related Mortgaged
Properties held for the benefit of the Certificateholders. The Servicer shall
prepare and deliver to the Depositor and/or the Trustee such documents requiring
execution and delivery by either or both of them as are necessary or appropriate
to enable the Servicer to service and administer the Mortgage Loans it services
to the extent that the Servicer is not permitted to execute and deliver such
documents pursuant to the preceding sentence. Upon receipt of such documents,
the Depositor and/or the Trustee, upon the direction of the Servicer, shall
promptly execute such documents and deliver them to the Servicer.
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In accordance with the standards of the preceding paragraph, the
Servicer shall advance or cause to be advanced funds as necessary for the
purpose of effecting the payment of taxes and assessments on the Mortgaged
Properties relating to the Mortgage Loans it services, which Servicing Advances
shall be reimbursable in the first instance from related collections from the
Mortgagors pursuant to Section 3.09, and further as provided in Section 3.11.
The costs incurred by the Servicer, if any, in effecting the timely payments of
taxes and assessments on the Mortgaged Properties and related insurance premiums
shall not, for the purpose of calculating monthly distributions to the
Certificateholders, be added to the Stated Principal Balances of the related
Mortgage Loans, notwithstanding that the terms of such Mortgage Loans so permit.
The relationship of the Servicer (and of any successor to the Servicer
as servicer under this Agreement) to the Trustee under this Agreement is
intended by the parties to be that of an independent contractor and not that of
a joint venturer, partner or agent.
Section 3.02 Subservicing; Enforcement of the Obligations of Servicer.
(a) The Servicer may arrange for the subservicing of any Mortgage Loan
it services by a Subservicer pursuant to a Subservicing Agreement; provided,
however, that such subservicing arrangement and the terms of the related
Subservicing Agreement must provide for the servicing of such Mortgage Loan in a
manner consistent with the servicing arrangements contemplated hereunder.
Notwithstanding the provisions of any Subservicing Agreement, any of the
provisions of this Agreement relating to agreements or arrangements between the
Servicer and a Subservicer or reference to actions taken through a Subservicer
or otherwise, the Servicer shall remain obligated and liable to the Depositor,
the Trustee and the Certificateholders for the servicing and administration of
the Mortgage Loans it services in accordance with the provisions of this
Agreement without diminution of such obligation or liability by virtue of such
Subservicing Agreements or arrangements or by virtue of indemnification from the
Subservicer and to the same extent and under the same terms and conditions as if
the Servicer alone were servicing and administering those Mortgage Loans. All
actions of each Subservicer performed pursuant to the related Subservicing
Agreement shall be performed as agent of the Servicer with the same force and
effect as if performed directly by the Servicer.
(b) For purposes of this Agreement, the Servicer shall be deemed to
have received any collections, recoveries or payments with respect to the
Mortgage Loans it services that are received by a Subservicer regardless of
whether such payments are remitted by the Subservicer to the Servicer.
(c) As part of its servicing activities hereunder, the Servicer, for
the benefit of the Trustee and the Certificateholders, shall use its best
reasonable efforts to enforce the obligations of each Subservicer engaged by the
Servicer under the related Subservicing Agreement, to the extent that the
non-performance of any such obligation would have a material and adverse effect
on a Mortgage Loan. Such enforcement, including, without limitation, the legal
prosecution of claims, termination of Subservicing Agreements and the pursuit of
other appropriate remedies, shall be in such form and carried out to such an
extent and at such time as the Servicer, in its good faith business judgment,
would require were it the owner of the related Mortgage Loans. The Servicer
shall pay the costs of such enforcement at its own expense, and shall be
reimbursed therefor only (i) from a general recovery resulting from such
enforcement to the extent, if any,
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that such recovery exceeds all amounts due in respect of the related Mortgage
Loan or (ii) from a specific recovery of costs, expenses or attorneys fees
against the party against whom such enforcement is directed.
(d) Any Subservicing Agreement entered into by the Servicer shall
provide that it may be assumed or terminated by the Trustee, if the Trustee has
assumed the duties of the Servicer, or any successor Servicer, at the Trustee's
or successor Servicer's option, as applicable, without cost or obligation to the
assuming or terminating party or the Trust Estate, upon the assumption by such
party of the obligations of the Servicer pursuant to Section 8.05.
Any Subservicing Agreement, and any other transactions or services
relating to the Mortgage Loans involving a Subservicer, shall be deemed to be
between the Servicer and such Subservicer alone, and the Trustee and the
Certificateholders shall not be deemed parties thereto and shall have no claims
or rights of action against, rights, obligations, duties or liabilities to or
with respect to the Subservicer or its officers, directors or employees, except
as set forth in Section 3.01.
Section 3.03 Fidelity Bond; Errors and Omissions Insurance.
The Servicer shall maintain, at its own expense, a blanket fidelity
bond and an errors and omissions insurance policy, with broad coverage on all
officers, employees or other persons acting in any capacity requiring such
persons to handle funds, money, documents or papers relating to the Mortgage
Loans it services. These policies must insure the Servicer against losses
resulting from dishonest or fraudulent acts committed by the Servicer's
personnel, any employees of outside firms that provide data processing services
for the Servicer, and temporary contract employees or student interns. Such
fidelity bond shall also protect and insure the Servicer against losses in
connection with the release or satisfaction of a Mortgage Loan without having
obtained payment in full of the indebtedness secured thereby. No provision of
this Section 3.03 requiring such fidelity bond and errors and omissions
insurance shall diminish or relieve the Servicer from its duties and obligations
as set forth in this Agreement. The minimum coverage under any such bond and
insurance policy shall be at least equal to the corresponding amounts required
by FNMA in the FNMA Servicing Guide or by FHLMC in the FHLMC Sellers' &
Servicers' Guide, as amended or restated from time to time, or in an amount as
may be permitted to the Servicer by express waiver of FNMA or FHLMC.
Section 3.04 Access to Certain Documentation.
The Servicer shall provide to the OTS and the FDIC and to comparable
regulatory authorities supervising Holders of Subordinate Certificates and the
examiners and supervisory agents of the OTS, the FDIC and such other
authorities, access to the documentation required by applicable regulations of
the OTS and the FDIC with respect to the Mortgage Loans. Such access shall be
afforded without charge, but only upon reasonable and prior written request and
during normal business hours at the offices designated by the Servicer. Nothing
in this Section 3.04 shall limit the obligation of the Servicer to observe any
applicable law and the failure of the Servicer to provide access as provided in
this Section 3.04 as a result of such obligation shall not constitute a breach
of this Section 3.04.
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Section 3.05 Maintenance of Primary Mortgage Insurance Policy; Claims.
With respect to each Mortgage Loan with a Loan-to-Value Ratio in
excess of 80% or such other Loan-to-Value Ratio as may be required by law, the
Servicer responsible for servicing such Mortgage Loan shall, without any cost to
the Trust Estate, maintain or cause the Mortgagor to maintain in full force and
effect a Primary Insurance Policy insuring that portion of the Mortgage Loan in
excess of a percentage in conformity with FNMA requirements. The Servicer shall
pay or shall cause the Mortgagor to pay the premium thereon on a timely basis,
at least until the Loan-to-Value Ratio of such Mortgage Loan is reduced to 80%
or such other Loan-to-Value Ratio as may be required by law. If such Primary
Insurance Policy is terminated, the Servicer shall obtain from another insurer a
comparable replacement policy, with a total coverage equal to the remaining
coverage of such terminated Primary Insurance Policy. If the insurer shall cease
to be an insurer acceptable to FNMA, the Servicer shall notify the Trustee in
writing, it being understood that the Servicer shall not have any responsibility
or liability for any failure to recover under the Primary Insurance Policy for
such reason. If the Servicer determines that recoveries under the Primary
Insurance Policy are jeopardized by the financial condition of the insurer, the
Servicer shall obtain from another insurer which meets the requirements of this
Section 3.05 a replacement insurance policy. The Servicer shall not take any
action that would result in noncoverage under any applicable Primary Insurance
Policy of any loss that, but for the actions of the Servicer, would have been
covered thereunder. In connection with any assumption or substitution agreement
entered into or to be entered into pursuant to Section 3.13, the Servicer shall
promptly notify the insurer under the related Primary Insurance Policy, if any,
of such assumption or substitution of liability in accordance with the terms of
such Primary Insurance Policy and shall take all actions which may be required
by such insurer as a condition to the continuation of coverage under such
Primary Insurance Policy. If such Primary Insurance Policy is terminated as a
result of such assumption or substitution of liability, the Servicer shall
obtain a replacement Primary Insurance Policy as provided above.
In connection with its activities as servicer, the Servicer agrees to
prepare and present, on behalf of itself, the Trustee and the
Certificateholders, claims to the insurer under any Primary Insurance Policy in
a timely fashion in accordance with the terms of such Primary Insurance Policy
and, in this regard, to take such action as shall be necessary to permit
recovery under any Primary Insurance Policy respecting a defaulted Mortgage
Loan. Pursuant to Section 3.09(a), any amounts collected by the Servicer under
any Primary Insurance Policy shall be deposited in the related Escrow Account,
subject to withdrawal pursuant to Section 3.09(b).
The Servicer will comply with all provisions of applicable state and
federal law relating to the cancellation of, or collection of premiums with
respect to, Primary Mortgage Insurance, including, but not limited to, the
provisions of the Homeowners Protection Act of 1998, and all regulations
promulgated thereunder, as amended from time to time.
Section 3.06 Rights of the Depositor and the Trustee in Respect of the
Servicer.
The Depositor may, but is not obligated to, enforce the obligations of
the Servicer hereunder and may, but is not obligated to, perform, or cause a
designee to perform, any defaulted obligation of the Servicer hereunder and in
connection with any such defaulted obligation to exercise the related rights of
the Servicer hereunder; provided that the Servicer shall
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not be relieved of any of its obligations hereunder by virtue of such
performance by the Depositor or its designee. Neither the Trustee nor the
Depositor shall have any responsibility or liability for any action or failure
to act by the Servicer nor shall the Trustee or the Depositor be obligated to
supervise the performance of the Servicer hereunder or otherwise.
Any Subservicing Agreement that may be entered into and any
transactions or services relating to the Mortgage Loans involving a Subservicer
in its capacity as such shall be deemed to be between the Subservicer and the
Servicer alone, and the Trustee and Certificateholders shall not be deemed
parties thereto and shall have no claims, rights, obligations, duties or
liabilities with respect to the Subservicer except as set forth in Section 3.07.
The Servicer shall be solely liable for all fees owed by it to any Subservicer,
irrespective of whether the Servicer's compensation pursuant to this Agreement
is sufficient to pay such fees.
Section 3.07 Trustee to Act as Servicer.
If the Servicer shall for any reason no longer be the Servicer
hereunder (including by reason of an Event of Default), the Trustee shall
thereupon assume, if it so elects, or shall appoint a successor Servicer to
assume, all of the rights and obligations of the Servicer hereunder arising
thereafter (except that the Trustee shall not be (a) liable for losses of the
Servicer pursuant to Section 3.12 or any acts or omissions of the predecessor
Servicer hereunder, (b) obligated to make Advances if it is prohibited from
doing so by applicable law or (c) deemed to have made any representations and
warranties of the Servicer hereunder). Any such assumption shall be subject to
Section 7.02. If the Servicer shall for any reason no longer be the Servicer
(including by reason of any Event of Default), the Trustee or the successor
Servicer may elect to succeed to any rights and obligations of the Servicer
under each Subservicing Agreement or may terminate each Subservicing Agreement.
If it has elected to assume the Subservicing Agreement, the Trustee or the
successor Servicer shall be deemed to have assumed all of the Servicer's
interest therein and to have replaced the Servicer as a party to any
Subservicing Agreement entered into by the Servicer as contemplated by Section
3.02 to the same extent as if the Subservicing Agreement had been assigned to
the assuming party except that the Servicer shall not be relieved of any
liability or obligations under any such Subservicing Agreement.
The Servicer that is no longer the Servicer hereunder shall, upon
request of the Trustee, but at the expense of the Servicer, deliver to the
assuming party all documents and records relating to each Subservicing Agreement
or substitute servicing agreement and the Mortgage Loans then being serviced
thereunder and an accounting of amounts collected or held by it and otherwise
use its best efforts to effect the orderly and efficient transfer of such
substitute Subservicing Agreement to the assuming party. Section 3.08 Collection
of Mortgage Loan Payments; Servicer Custodial Account; Certificate Account; and
Upper-Tier Certificate Account.
(a) Continuously from the date hereof until the principal and interest
on all Mortgage Loans are paid in full, the Servicer will proceed diligently, in
accordance with this Agreement, to collect all payments due under each of the
Mortgage Loans it services when the same shall become due and payable. Further,
the Servicer will in accordance with all applicable law and Customary Servicing
Procedures ascertain and estimate taxes, assessments, fire and
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hazard insurance premiums, mortgage insurance premiums and all other charges
with respect to the Mortgage Loans it services that, as provided in any
Mortgage, will become due and payable to the end that the installments payable
by the Mortgagors will be sufficient to pay such charges as and when they become
due and payable. Consistent with the foregoing, the Servicer may in its
discretion (i) waive any late payment charge or any prepayment charge or penalty
interest in connection with the prepayment of a Mortgage Loan it services and
(ii) extend the due dates for payments due on a Mortgage Note for a period not
greater than 120 days; provided, however, that the Servicer cannot extend the
maturity of any such Mortgage Loan past the date on which the final payment is
due on the latest maturing Mortgage Loan as of the Cut-Off Date. In the event of
any such arrangement, the Servicer shall make Periodic Advances on the related
Mortgage Loan in accordance with the provisions of Section 3.20 during the
scheduled period in accordance with the amortization schedule of such Mortgage
Loan without modification thereof by reason of such arrangements. The Servicer
shall not be required to institute or join in litigation with respect to
collection of any payment (whether under a Mortgage, Mortgage Note or otherwise
or against any public or governmental authority with respect to a taking or
condemnation) if it reasonably believes that enforcing the provision of the
Mortgage or other instrument pursuant to which such payment is required is
prohibited by applicable law.
(b) The Servicer shall establish and maintain the Servicer Custodial
Account. The Servicer shall deposit or cause to be deposited into the Servicer
Custodial Account, all on a daily basis within one Business Day of receipt,
except as otherwise specifically provided herein, the following payments and
collections remitted by Subservicers or received by the Servicer in respect of
the Mortgage Loans subsequent to the Cut-Off Date (other than in respect of
principal and interest due on the Mortgage Loans on or before the Cut-Off Date)
and the following amounts required to be deposited hereunder with respect to the
Mortgage Loans it services:
(i) all payments on account of principal of the Mortgage Loans,
including Principal Prepayments;
(ii) all payments on account of interest on the Mortgage Loans, net of
the Servicing Fee;
(iii) (A) all Insurance Proceeds and Liquidation Proceeds, other than
Insurance Proceeds to be (1) applied to the restoration or repair of the
Mortgaged Property, (2) released to the Mortgagor in accordance with
Customary Servicing Procedures or (3) required to be deposited to an Escrow
Account pursuant to Section 3.09(a) and (B) any Insurance Proceeds released
from an Escrow Account pursuant to Section 3.09(b)(iv);
(iv) any amount required to be deposited by the Servicer pursuant to
Section 3.08(d) in connection with any losses on Permitted Investments with
respect to the Servicer Custodial Account;
(v) any amounts required to be deposited by the Servicer pursuant to
Section 3.14;
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(vi) all Repurchase Prices and all Substitution Adjustment Amounts
received by the Servicer; (vii) Periodic Advances made by the Servicer
pursuant to Section 3.20 and any payments of Compensating Interest; and
(viii) any other amounts required to be deposited hereunder.
The foregoing requirements for deposits to the Servicer Custodial
Account by the Servicer shall be exclusive, it being understood and agreed that,
without limiting the generality of the foregoing, payments in the nature of
prepayment penalties, late payment charges or assumption fees, if collected,
need not be deposited by the Servicer. If the Servicer shall deposit in the
Servicer Custodial Account any amount not required to be deposited, it may at
any time withdraw or direct the institution maintaining the Servicer Custodial
Account to withdraw such amount from the Servicer Custodial Account, any
provision herein to the contrary notwithstanding. The Servicer Custodial Account
may contain funds that belong to one or more trust funds created for mortgage
pass-through certificates of other series and may contain other funds respecting
payments on mortgage loans belonging to the Servicer or serviced by the Servicer
on behalf of others. Notwithstanding such commingling of funds, the Servicer
shall keep records that accurately reflect the funds on deposit in the Servicer
Custodial Account that have been identified by it as being attributable to the
Mortgage Loans it services. The Servicer shall maintain adequate records with
respect to all withdrawals made pursuant to this Section 3.08. All funds
required to be deposited in the Servicer Custodial Account shall be held in
trust for the Certificateholders until withdrawn in accordance with Section
3.11.
(c) The Trustee shall establish and maintain, on behalf of the
Certificateholders, the Certificate Account. The Trustee shall, promptly upon
receipt, deposit in the Certificate Account and retain therein the following:
(i) the aggregate amount remitted by the Servicer to the Trustee
pursuant to Section 3.11(a)(viii);
(ii) any amount paid by the Trustee pursuant to Section 3.08(d) in
connection with any losses on Permitted Investments with respect to the
Certificate Account; and
(iii) any other amounts deposited hereunder which are required to be
deposited in the Certificate Account.
If the Servicer shall remit any amount not required to be
remitted, it may at any time direct the Trustee to withdraw such amount from the
Certificate Account, any provision herein to the contrary notwithstanding. Such
direction may be accomplished by delivering an Officer's Certificate to the
Trustee which describes the amounts deposited in error in the Certificate
Account. All funds required to be deposited in the Certificate Account shall be
held by the Trustee in trust for the Certificateholders until disbursed in
accordance with this Agreement or withdrawn in accordance with Section 3.11. In
no event shall the Trustee incur liability for withdrawals from the Certificate
Account at the direction of a the Servicer.
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(d) Each institution at which the Servicer Custodial Account or the
Certificate Account is maintained shall invest the funds therein as directed in
writing by the Servicer in Permitted Investments, which shall mature not later
than (i) in the case of the Servicer Custodial Account, the Business Day next
preceding the related Remittance Date (except that if such Permitted Investment
is an obligation of the institution that maintains such account, then such
Permitted Investment shall mature not later than such Remittance Date) and (ii)
in the case of the Certificate Account, the Business Day next preceding the
Distribution Date (except that if such Permitted Investment is an obligation of
the institution that maintains such account, then such Permitted Investment
shall mature not later than such Distribution Date) and, in each case, shall not
be sold or disposed of prior to its maturity. All such Permitted Investments
shall be made in the name of the Trustee, for the benefit of the
Certificateholders. All income or gain (net of any losses) realized from any
such investment of funds on deposit in the Servicer Custodial Account shall be
for the benefit of the Servicer as servicing compensation and shall be retained
by it monthly as provided herein. All income or gain (net of any losses)
realized from any such investment of funds on deposit in the Certificate Account
shall be for the benefit of the Trustee as additional compensation and shall be
retained by it monthly as provided herein. The amount of any losses realized in
the Servicer Custodial Account or the Certificate Account incurred in any such
account in respect of any such investments shall promptly be deposited by the
Servicer in the Servicer Custodial Account or by the Trustee in the Certificate
Account, as applicable.
(e) The Servicer shall give notice to the Trustee of any proposed
change of the location of the Servicer Custodial Account maintained by the
Servicer not later than 30 days and not more than 45 days prior to any change
thereof. The Trustee shall give notice to the Servicer, each Rating Agency and
the Depositor of any proposed change of the location of the Certificate Account
not later than 30 days and not more than 45 days prior to any change thereof.
The creation of the Servicer Custodial Account shall be evidenced by a
certification substantially in the form of Exhibit F hereto. A copy of such
certification shall be furnished to the Trustee.
(f) The Trustee shall establish and maintain the Upper-Tier
Certificate Account. On each Distribution Date (other than the Final
Distribution Date, if such Final Distribution Date is in connection with a
purchase of the assets of the Trust Estate by the Depositor), the Trustee shall,
from funds available on deposit in the Certificate Account, deposit, in
immediately available funds, by wire transfer or otherwise, into the Upper-Tier
Certificate Account, the Lower-Tier Distribution Amount.
Section 3.09 Collection of Taxes, Assessments and Similar Items;
Escrow Accounts.
(a) To the extent required by the related Mortgage Note and not
violative of current law, the Servicer shall segregate and hold all funds
collected and received pursuant to each Mortgage Loan which constitute Escrow
Payments in trust separate and apart from any of its own funds and general
assets and for such purpose shall establish and maintain one or more escrow
accounts (collectively, the "Escrow Account"), titled "[Insert name of
Servicer], in trust for registered holders of Wachovia Asset Securitization
Issuance, LLC Mortgage Pass-Through Certificates, Series 200 - and various
Mortgagors." The Escrow Account shall be established with a commercial bank, a
savings bank or a savings and loan association that meets the guidelines set
forth by FNMA or FHLMC as an eligible institution for escrow accounts and
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which is a member of the Automated Clearing House. In any case, the Escrow
Account shall be insured by the FDIC to the fullest extent permitted by law. The
Servicer shall deposit in the appropriate Escrow Account on a daily basis, and
retain therein: (i) all Escrow Payments collected on account of the Mortgage
Loans, (ii) all amounts representing proceeds of any hazard insurance policy
which are to be applied to the restoration or repair of any related Mortgaged
Property and (iii) all amounts representing proceeds of any Primary Insurance
Policy. Nothing herein shall require the Servicer to compel a Mortgagor to
establish an Escrow Account in violation of applicable law.
(b) Withdrawals of amounts so collected from the Escrow Accounts may
be made by the Servicer only (i) to effect timely payment of taxes, assessments,
mortgage insurance premiums, fire and hazard insurance premiums, condominium or
PUD association dues, or comparable items constituting Escrow Payments for the
related Mortgage, (ii) to reimburse the Servicer out of related Escrow Payments
made with respect to a Mortgage Loan for any Servicing Advance made by the
Servicer pursuant to Section 3.09(c) with respect to such Mortgage Loan, (iii)
to refund to any Mortgagor any sums determined to be overages, (iv) for transfer
to the Servicer Custodial Account upon default of a Mortgagor or in accordance
with the terms of the related Mortgage Loan and if permitted by applicable law,
(v) for application to restore or repair the Mortgaged Property, (vi) to pay to
the Mortgagor, to the extent required by law, any interest paid on the funds
deposited in the Escrow Account, (vii) to pay to itself any interest earned on
funds deposited in the Escrow Account (and not required to be paid to the
Mortgagor), (viii) to the extent permitted under the terms of the related
Mortgage Note and applicable law, to pay late fees with respect to any Monthly
Payment which is received after the applicable grace period, (ix) to withdraw
suspense payments that are deposited into the Escrow Account, (x) to withdraw
any amounts inadvertently deposited in the Escrow Account or (xi) to clear and
terminate the Escrow Account upon the termination of this Agreement in
accordance with Section 10.01. Any Escrow Account shall not be a part of the
Trust Estate.
(c) With respect to each Mortgage Loan, the Servicer shall maintain
accurate records reflecting the status of taxes, assessments and other charges
which are or may become a lien upon the Mortgaged Property and the status of
Primary Insurance Policy premiums and fire and hazard insurance coverage. The
Servicer shall obtain, from time to time, all bills for the payment of such
charges (including renewal premiums) and shall effect payment thereof prior to
the applicable penalty or termination date and at a time appropriate for
securing maximum discounts allowable, employing for such purpose deposits of the
Mortgagor in the Escrow Account, if any, which shall have been estimated and
accumulated by the Servicer in amounts sufficient for such purposes, as allowed
under the terms of the Mortgage. To the extent that a Mortgage does not provide
for Escrow Payments, the Servicer shall determine that any such payments are
made by the Mortgagor. The Servicer assumes full responsibility for the timely
payment of all such bills and shall effect timely payments of all such bills
irrespective of each Mortgagor's faithful performance in the payment of same or
the making of the Escrow Payments. The Servicer shall advance any such payments
that are not timely paid, but the Servicer shall be required so to advance only
to the extent that such Servicing Advances, in the good faith judgment of the
Servicer, will be recoverable by the Servicer out of Insurance Proceeds,
Liquidation Proceeds or otherwise.
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Section 3.10 Access to Certain Documentation and Information Regarding
the Mortgage Loans.
The Servicer shall afford the Trustee reasonable access to all records
and documentation regarding the Mortgage Loans and all accounts, insurance
information and other matters relating to this Agreement, such access being
afforded without charge, but only upon reasonable request and during normal
business hours at the office designated by the Servicer.
Upon reasonable advance notice in writing, the Servicer will provide
to each Certificateholder which is a savings and loan association, bank or
insurance company certain reports and reasonable access to information and
documentation regarding the Mortgage Loans sufficient to permit such
Certificateholder to comply with applicable regulations of the OTS or other
regulatory authorities with respect to investment in the Certificates; provided
that the Servicer shall be entitled to be reimbursed by each such
Certificateholder for actual expenses incurred by the Servicer in providing such
reports and access.
Section 3.11 Permitted Withdrawals from the Servicer Custodial
Account; Certificate Account and Upper-Tier Certificate Account.
(a) The Servicer may from time to time make withdrawals from the
Servicer Custodial Account, for the following purposes:
(i) to pay to the Servicer (to the extent not previously retained),
the servicing compensation to which it is entitled pursuant to Section
3.17, and to pay to the Servicer, as additional servicing compensation,
earnings on or investment income with respect to funds in or credited to
the Servicer Custodial Account;
(ii) to reimburse the Servicer for unreimbursed Advances made by it,
such right of reimbursement pursuant to this clause (ii) being limited to
amounts received on the Mortgage Loan(s) in respect of which any such
Advance was made;
(iii) to reimburse the Servicer for any Nonrecoverable Advance
previously made; (iv) to reimburse the Servicer for Insured Expenses from
the related Insurance Proceeds;
(v) to pay to the purchaser, with respect to each Mortgage Loan or REO
Property that has been purchased pursuant to Section 2.02 or 2.04, all
amounts received thereon after the date of such purchase;
(vi) to reimburse the Servicer or the Depositor for expenses incurred
by any of them and reimbursable pursuant to Section 7.03;
(vii) to withdraw any amount deposited in the Servicer Custodial
Account and not required to be deposited therein;
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(viii) on or prior to the Remittance Date, to withdraw an amount equal
to the related Pool Distribution Amount, the related Trustee Fee and any
other amounts due to the Trustee under this Agreement for such Distribution
Date, to the extent on deposit, and remit such amount in immediately
available funds to the Trustee for deposit in the Certificate Account; and
(ix) to clear and terminate the Servicer Custodial Account upon
termination of this Agreement pursuant to Section 10.01.
The Servicer shall keep and maintain separate accounting, on a
Mortgage Loan by Mortgage Loan basis, for the purpose of justifying any
withdrawal from the Servicer Custodial Account pursuant to clauses (i), (ii),
(iv) and (v). Prior to making any withdrawal from the Servicer Custodial Account
pursuant to clause (iii), the Servicer shall deliver to the Trustee an Officer's
Certificate of a Servicing Officer indicating the amount of any previous Advance
determined by the Servicer to be a Nonrecoverable Advance and identifying the
related Mortgage Loan(s) and their respective portions of such Nonrecoverable
Advance.
(b) The Trustee shall withdraw funds from the Certificate Account for
distributions to Certificateholders in the manner specified in this Agreement.
In addition, the Trustee may from time to time make withdrawals from the
Certificate Account for the following purposes:
(i) to pay to itself the Trustee Fee and any other amounts due to the
Trustee under this Agreement for the related Distribution Date;
(ii) to pay to itself as additional compensation earnings on or
investment income with respect to funds in the Certificate Account;
(iii) to withdraw and return to the Servicer any amount deposited in
the Certificate Account and not required to be deposited therein; and
(iv) to clear and terminate the Certificate Account upon termination
of the Agreement pursuant to Section 10.01.
(c) Notwithstanding anything herein to the contrary, the Regular
Certificates and the Class A-R Certificate shall not receive distributions
directly from the Certificate Account. On each Distribution Date, funds on
deposit in the Upper-Tier Certificate Account shall be used to make payments on
the Regular Certificates and the Class A-R Certificate as provided in Sections
5.01 and 5.02. The Upper-Tier Certificate Account shall be cleared and
terminated upon termination of this Agreement pursuant to Section 10.01.
Section 3.12 Maintenance of Hazard Insurance.
The Servicer shall cause to be maintained for each Mortgage Loan, fire
and hazard insurance with extended coverage customary in the area where the
Mortgaged Property is located in an amount which is at least equal to the lesser
of (a) the full insurable value of the Mortgaged Property or (b) the greater of
(i) the outstanding principal balance owing on the Mortgage Loan and (ii) an
amount such that the proceeds of such insurance shall be sufficient to
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avoid the application to the Mortgagor or loss payee of any coinsurance clause
under the policy. If the Mortgaged Property is in an area identified in the
Federal Register by the Federal Emergency Management Agency as having special
flood hazards (and such flood insurance has been made available) the Servicer
will cause to be maintained a flood insurance policy meeting the requirements of
the current guidelines of the Federal Insurance Administration and the
requirements of FNMA or FHLMC. The Servicer shall also maintain on REO Property,
fire and hazard insurance with extended coverage in an amount which is at least
equal to the maximum insurable value of the improvements which are a part of
such property, liability insurance and, to the extent required, flood insurance
in an amount required above. Any amounts collected by the Servicer under any
such policies (other than amounts to be deposited in an Escrow Account and
applied to the restoration or repair of the property subject to the related
Mortgage or property acquired in liquidation of the Mortgage Loan, or to be
released to the Mortgagor in accordance with Customary Servicing Procedures)
shall be deposited in the Servicer Custodial Account, subject to withdrawal
pursuant to Section 3.11(a). It is understood and agreed that no earthquake or
other additional insurance need be required by the Servicer of any Mortgagor or
maintained on REO Property, other than pursuant to such applicable laws and
regulations as shall at any time be in force and as shall require such
additional insurance. All policies required hereunder shall be endorsed with
standard mortgagee clauses with loss payable to the Servicer, and shall provide
for at least 30 days prior written notice of any cancellation, reduction in
amount or material change in coverage to the Servicer.
The hazard insurance policies for each Mortgage Loan secured by a unit
in a condominium development or planned unit development shall be maintained
with respect to such Mortgage Loan and the related development in a manner which
is consistent with FNMA requirements.
Notwithstanding the foregoing, the Servicer may maintain a blanket
policy insuring against hazard losses on all of the Mortgaged Properties
relating to the Mortgage Loans in lieu of maintaining the required hazard
insurance policies for each Mortgage Loan and may maintain a blanket policy
insuring against special flood hazards in lieu of maintaining any required flood
insurance. Any such blanket policies shall (A) be consistent with prudent
industry standards, (B) name the Servicer as loss payee, (C) provide coverage in
an amount equal to the aggregate unpaid principal balance on the related
Mortgage Loans without co-insurance, and (D) otherwise comply with the
requirements of this Section 3.12. Any such blanket policy may contain a
deductible clause; provided that if any Mortgaged Property is not covered by a
separate policy otherwise complying with this Section 3.12 and a loss occurs
with respect to such Mortgaged Property which loss would have been covered by
such a policy, the Servicer shall deposit in the Servicer Custodial Account the
difference, if any, between the amount that would have been payable under a
separate policy complying with this Section 3.12 and the amount paid under such
blanket policy.
Section 3.13 Enforcement of Due-On-Sale Clauses; Assumption
Agreements.
(a) Except as otherwise provided in this Section 3.13, when any
Mortgaged Property subject to a Mortgage has been conveyed by the Mortgagor, the
Servicer shall use reasonable efforts, to the extent that it has actual
knowledge of such conveyance, to enforce any due-on-sale clause contained in any
Mortgage Note or Mortgage, to the extent permitted under
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applicable law and governmental regulations, but only to the extent that such
enforcement will not adversely affect or jeopardize coverage under any Required
Insurance Policy. Notwithstanding the foregoing, the Servicer is not required to
exercise such rights with respect to a Mortgage Loan if the Person to whom the
related Mortgaged Property has been conveyed or is proposed to be conveyed
satisfies the terms and conditions contained in the Mortgage Note and Mortgage
related thereto and the consent of the mortgagee under such Mortgage Note or
Mortgage is not otherwise required under such Mortgage Note or Mortgage as a
condition to such transfer. If (i) the Servicer is prohibited by law from
enforcing any such due-on-sale clause, (ii) coverage under any Required
Insurance Policy would be adversely affected, (iii) the Mortgage Note does not
include a due-on-sale clause or (iv) nonenforcement is otherwise permitted
hereunder, the Servicer is authorized, subject to Section 3.13(b), to take or
enter into an assumption and modification agreement from or with the Person to
whom such Mortgaged Property has been or is about to be conveyed, pursuant to
which such Person becomes liable under the Mortgage Note and, unless prohibited
by applicable state law, the Mortgagor remains liable thereon; provided that the
Mortgage Loan shall continue to be covered (if so covered before the Servicer
enters such agreement) by the applicable Required Insurance Policies. The
Servicer, subject to Section 3.13(b), is also authorized with the prior approval
of the insurers under any Required Insurance Policies to enter into a
substitution of liability agreement with such Person, pursuant to which the
original Mortgagor is released from liability and such Person is substituted as
Mortgagor and becomes liable under the Mortgage Note. Notwithstanding the
foregoing, the Servicer shall not be deemed to be in default under this Section
3.13 by reason of any transfer or assumption which the Servicer reasonably
believes it is restricted by law from preventing, for any reason whatsoever.
(b) Subject to the Servicer's duty to enforce any due-on-sale clause
to the extent set forth in Section 3.13(a), in any case in which a Mortgaged
Property has been conveyed to a Person by a Mortgagor, and such Person is to
enter into an assumption agreement or modification agreement or supplement to
the Mortgage Note or Mortgage that requires the signature of the Trustee, or if
an instrument of release signed by the Trustee is required releasing the
Mortgagor from liability on the Mortgage Loan, the Servicer shall prepare and
deliver or cause to be prepared and delivered to the Trustee for signature and
shall direct, in writing, the Trustee to execute the assumption agreement with
the Person to whom the Mortgaged Property is to be conveyed and such
modification agreement or supplement to the Mortgage Note or Mortgage or other
instruments as are reasonable or necessary to carry out the terms of the
Mortgage Note or Mortgage or otherwise to comply with any applicable laws
regarding assumptions or the transfer of the Mortgaged Property to such Person.
In no event shall the Trustee incur liability for executing any document under
this Section 3.13 at the direction of the Servicer. In connection with any such
assumption, no material term of the Mortgage Note may be changed. In addition,
the substitute Mortgagor and the Mortgaged Property must be acceptable to the
Servicer in accordance with its underwriting standards as then in effect.
Together with each such substitution, assumption or other agreement or
instrument delivered to the Trustee for execution by it, the Servicer shall
deliver an Officer's Certificate signed by a Servicing Officer stating that the
requirements of this subsection have been met. The Servicer shall notify the
Trustee that any such substitution or assumption agreement has been completed by
forwarding to the Trustee (or at the direction of the Trustee, the Custodian)
the original of such substitution or assumption agreement, which in the case of
the original shall be added to the related Mortgage File and shall, for all
purposes, be considered a part of such Mortgage File to
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the same extent as all other documents and instruments constituting a part
thereof. Any fee collected by the Servicer for entering into an assumption or
substitution of liability agreement may be retained by the Servicer as
additional master servicing compensation. Notwithstanding the foregoing, to the
extent permissible under applicable law and at the request of the Servicer, the
Trustee shall execute and deliver to the Servicer any powers of attorney and
other documents prepared by the Servicer that are reasonably necessary or
appropriate to enable the Servicer to execute any assumption agreement or
modification agreement required to be executed by the Trustee under this Section
3.13.
Section 3.14 Realization Upon Defaulted Mortgage Loans; REO Property.
(a) The Servicer shall use reasonable efforts to foreclose upon or
otherwise comparably convert the ownership of Mortgaged Properties securing such
of the Mortgage Loans as come into and continue in default and as to which no
satisfactory arrangements can be made for collection of delinquent payments. In
connection with such foreclosure or other conversion, the Servicer shall follow
Customary Servicing Procedures and shall meet the requirements of the insurer
under any Required Insurance Policy; provided, however, that the Servicer may
enter into a special servicing agreement with an unaffiliated Holder of 100%
Percentage Interest of a Class of Class B Certificates or a holder of a class of
securities representing interests in the Class B Certificates alone or together
with other subordinated mortgage pass-through certificates. Such agreement shall
be substantially in the form attached hereto as Exhibit K or subject to each
Rating Agency's acknowledgment that the ratings of the Certificates in effect
immediately prior to the entering into such agreement would not be qualified,
downgraded or withdrawn and the Certificates would not be placed on credit
review status (except for possible upgrading) as a result of such agreement. Any
such agreement may contain provisions whereby such holder may instruct the
Servicer to commence or delay foreclosure proceedings with respect to delinquent
Mortgage Loans and will contain provisions for the deposit of cash by the holder
that would be available for distribution to Certificateholders if Liquidation
Proceeds are less than they otherwise may have been had the Servicer acted in
accordance with its normal procedures. Notwithstanding the foregoing, the
Servicer shall not be required to expend its own funds in connection with any
foreclosure or towards the restoration of any Mortgaged Property unless it shall
determine (i) that such restoration and/or foreclosure will increase the
proceeds of liquidation of the Mortgage Loan after reimbursement to itself of
such expenses and (ii) that such expenses will be recoverable to it through
proceeds of the liquidation of the Mortgage Loan (respecting which it shall have
priority for purposes of withdrawals from the Servicer Custodial Account). Any
such expenditures shall constitute Servicing Advances for purposes of this
Agreement.
The decision of the Servicer to foreclose on a defaulted Mortgage Loan
shall be subject to a determination by the Servicer that the proceeds of such
foreclosure would exceed the costs and expenses of bringing such a proceeding.
With respect to any REO Property, the deed or certificate of sale
shall be taken in the name of the Trustee for the benefit of the
Certificateholders, or its nominee, on behalf of the Certificateholders. The
Trustee's name shall be placed on the title to such REO Property solely as the
Trustee hereunder and not in its individual capacity. The Servicer shall ensure
that the title to such REO Property references this Agreement and the Trustee's
capacity hereunder.
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Pursuant to its efforts to sell such REO Property, the Servicer shall either
itself or through an agent selected by the Servicer manage, conserve, protect
and operate such REO Property in the same manner that it manages, conserves,
protects and operates other foreclosed property for its own account and in the
same manner that similar property in the same locality as the REO Property is
managed. Incident to its conservation and protection of the interests of the
Certificateholders, the Servicer may rent the same, or any part thereof, as the
Servicer deems to be in the best interest of the Certificateholders for the
period prior to the sale of such REO Property. The Servicer shall prepare for
and deliver to the Trustee a statement with respect to each REO Property that
has been rented, if any, showing the aggregate rental income received and all
expenses incurred in connection with the management and maintenance of such REO
Property at such times as is necessary to enable the Trustee to comply with the
reporting requirements of the REMIC Provisions; provided, however, that the
Servicer shall have no duty to rent any REO Property on behalf of the Trust. The
net monthly rental income, if any, from such REO Property shall be deposited in
the Servicer Custodial Account no later than the close of business on each
Determination Date. The Servicer shall perform, with respect to the Mortgage
Loans, the tax reporting and withholding required by Sections 1445 and 6050J of
the Code with respect to foreclosures and abandonments, the tax reporting
required by Section 6050H of the Code with respect to the receipt of mortgage
interest from individuals and, if required by Section 6050P of the Code with
respect to the cancellation of indebtedness by certain financial entities, by
preparing such tax and information returns as may be required, in the form
required. The Servicer shall deliver copies of such reports to the Trustee.
If the Trust acquires any Mortgaged Property as described above or
otherwise in connection with a default or a default which is reasonably
foreseeable on a Mortgage Loan, the Servicer shall dispose of such Mortgaged
Property prior to the end of the third calendar year following the year of its
acquisition by the Trust (such period, the "REO Disposition Period") unless (A)
the Trustee shall have been supplied by the Servicer with an Opinion of Counsel
to the effect that the holding by the Trust of such Mortgaged Property
subsequent to the REO Disposition Period will not result in the imposition of
taxes on "prohibited transactions" (as defined in Section 860F of the Code) on
either the Upper-Tier REMIC or the Lower-Tier REMIC or cause either REMIC to
fail to qualify as a REMIC at any time that any Certificates are outstanding, or
(B) the Trustee (at the Servicer's expense) or the Servicer shall have applied
for, prior to the expiration of the REO Disposition Period, an extension of the
REO Disposition Period in the manner contemplated by Section 856(e)(3) of the
Code. If such an Opinion of Counsel is provided or such an exemption is
obtained, the Trust may continue to hold such Mortgaged Property (subject to any
conditions contained in such Opinion of Counsel) for the applicable period.
Notwithstanding any other provision of this Agreement, no Mortgaged Property
acquired by the Trust shall be rented (or allowed to continue to be rented) or
otherwise used for the production of income by or on behalf of the Trust in such
a manner or pursuant to any terms that would (i) cause such Mortgaged Property
to fail to qualify as "foreclosure property" within the meaning of Section
860G(a)(8) of the Code or (ii) subject either REMIC to the imposition of any
federal, state or local income taxes on the income earned from such Mortgaged
Property under Section 860G(c) of the Code or otherwise, unless the Servicer has
agreed to indemnify and hold harmless the Trust with respect to the imposition
of any such taxes. The Servicer shall identify to the Trustee any Mortgaged
Property relating to a Mortgage Loan held by the Trust for 30 months for which
no plans to dispose of such Mortgaged Property by the Servicer have been made.
After delivery of such identification, the Servicer shall proceed to
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dispose of any such Mortgaged Property by holding a commercially
reasonable auction for such property.
The income earned from the management of any REO Properties, net of
reimbursement to the Servicer for expenses incurred (including any property or
other taxes) in connection with such management and net of unreimbursed
Servicing Fees, Periodic Advances and Servicing Advances, shall be applied to
the payment of principal of and interest on the related defaulted Mortgage Loans
(solely for the purposes of allocating principal and interest, interest shall be
treated as accruing as though such Mortgage Loans were still current) and all
such income shall be deemed, for all purposes in this Agreement, to be payments
on account of principal and interest on the related Mortgage Notes and shall be
deposited into the Servicer Custodial Account. To the extent the net income
received during any calendar month is in excess of the amount attributable to
amortizing principal and accrued interest at the related Mortgage Interest Rate
on the related Mortgage Loan for such calendar month, such excess shall be
considered to be a partial prepayment of principal of the related Mortgage Loan.
The proceeds from any liquidation of a Mortgage Loan, as well as any
income from an REO Property, will be applied in the following order of priority:
first, to reimburse the Servicer for any related unreimbursed Servicing Advances
and Servicing Fees; second, to reimburse the Servicer for any unreimbursed
Periodic Advances and to reimburse the Servicer Custodial Account for any
Nonrecoverable Advances (or portions thereof) that were previously withdrawn by
the Servicer pursuant to Section 3.11(a)(iii) that related to such Mortgage
Loan; third, to accrued and unpaid interest (to the extent no Periodic Advance
has been made for such amount or any such Periodic Advance has been reimbursed)
on the Mortgage Loan or related REO Property, at the Mortgage Rate to the Due
Date occurring in the month in which such amounts are required to be
distributed; and fourth, as a recovery of principal of the Mortgage Loan. Excess
Proceeds, if any, from the liquidation of a Liquidated Mortgage Loan will be
retained by the Servicer as additional servicing compensation pursuant to
Section 3.17.
(b) The Servicer shall promptly notify the Depositor of any Mortgage
Loan which comes into default. The Depositor shall be entitled, at its option,
to repurchase (i) any such defaulted Mortgage Loan from the Trust Estate if (a)
in the Depositor's judgment, the default is not likely to be cured by the
Mortgagor and (b) such Mortgage Loan is 180 days or more delinquent or (ii) any
Mortgage Loan in the Trust Estate which pursuant to Section 4(b) of the Mortgage
Loan Purchase Agreement the Seller requests the Depositor to repurchase and to
sell to the Seller to facilitate the exercise of the Seller's rights against the
originator or prior holder of such Mortgage Loan. The purchase price for any
such Mortgage Loan shall be 100% of the unpaid principal balance of such
Mortgage Loan plus accrued interest thereon at the Mortgage Interest Rate (less
the Servicing Fee Rate for such Mortgage Loan) through the last day of the month
in which such repurchase occurs. Upon the receipt of such purchase price, the
Servicer shall provide to the Trustee the notification required by Section 3.15
and the Trustee or the Custodian shall promptly release to the Depositor the
Mortgage File relating to the Mortgage Loan being repurchased.
Section 3.15 Trustee to Cooperate; Release of Mortgage Files.
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Upon the payment in full of any Mortgage Loan, or the receipt by the
Servicer of a notification that payment in full will be escrowed in a manner
customary for such purposes, the Servicer will immediately notify the Trustee
(or, at the direction of the Trustee, the Custodian) by delivering, or causing
to be delivered, two copies (one of which will be returned to the Servicer with
the Mortgage File) of a Request for Release (which may be delivered in an
electronic format acceptable to the Trustee and the Servicer). Upon receipt of
such request, the Trustee or the Custodian, as applicable, shall within seven
Business Days release the related Mortgage File to the Servicer. The Trustee
shall at the Servicer's direction execute and deliver to the Servicer the
request for reconveyance, deed of reconveyance or release or satisfaction of
mortgage or such instrument releasing the lien of the Mortgage, in each case
provided by the Servicer, together with the Mortgage Note with written evidence
of cancellation thereon. If the Mortgage has been recorded in the name of MERS
or its designee, the Servicer shall take all necessary action to reflect the
release of the Mortgage on the records of MERS. Expenses incurred in connection
with any instrument of satisfaction or deed of reconveyance shall be chargeable
to the related Mortgagor. From time to time and as shall be appropriate for the
servicing or foreclosure of any Mortgage Loan, including for such purpose
collection under any policy of flood insurance, any fidelity bond or errors or
omissions policy, or for the purposes of effecting a partial release of any
Mortgaged Property from the lien of the Mortgage or the making of any
corrections to the Mortgage Note or the Mortgage or any of the other documents
included in the Mortgage File, the Trustee or the Custodian, as applicable,
shall, upon delivery to the Trustee (or, at the direction of the Trustee, the
Custodian) of a Request for Release signed by a Servicing Officer, release the
Mortgage File within seven Business Days to the Servicer. Subject to the further
limitations set forth below, the Servicer shall cause the Mortgage File so
released to be returned to the Trustee or the Custodian, as applicable, when the
need therefor by the Servicer no longer exists, unless the Mortgage Loan is
liquidated and the proceeds thereof are deposited in the Servicer Custodial
Account, in which case the Servicer shall deliver to the Trustee or the
Custodian, as applicable, a Request for Release, signed by a Servicing Officer.
The Trustee shall execute and deliver to the Servicer any powers of
attorney and other documents prepared by the Servicer that are reasonably
necessary or appropriate to enable the Servicer to carry out its servicing and
administrative duties under this Agreement, upon the request of the Servicer. In
addition, upon prepayment in full of any Mortgage Loan or the receipt of notice
that funds for such purpose have been placed in escrow, the Servicer is
authorized to give, as attorney-in-fact for the Trustee and the mortgagee under
the Mortgage, an instrument of satisfaction (or Assignment of Mortgage without
recourse) regarding the Mortgaged Property relating to such Mortgage Loan, which
instrument of satisfaction or Assignment of Mortgage, as the case may be, shall
be delivered to the Person entitled thereto against receipt of the prepayment in
full. If the Mortgage is registered in the name of MERS or its designee, the
Servicer shall take all necessary action to reflect the release on the records
of MERS. In lieu of executing such satisfaction or Assignment of Mortgage, or if
another document is required to be executed by the Trustee, the Servicer may
deliver or cause to be delivered to the Trustee, for signature, as appropriate,
any court pleadings, requests for trustee's sale or other documents necessary to
effectuate such foreclosure or any legal action brought to obtain judgment
against the Mortgagor on the Mortgage Note or the Mortgage or to obtain a
deficiency judgment or to enforce any other remedies or rights provided by the
Mortgage Note or the Mortgage or otherwise available at law or in equity.
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Section 3.16 Documents, Records and Funds in Possession of the
Servicer to be Held for the Trustee.
The Servicer shall transmit to the Trustee or, at the direction of the
Trustee, the Custodian as required by this Agreement all documents and
instruments in respect of a Mortgage Loan coming into the possession of the
Servicer from time to time and shall account fully to the Trustee for any funds
received by the Servicer or which otherwise are collected by the Servicer as
Liquidation Proceeds or Insurance Proceeds in respect of any Mortgage Loan. The
documents constituting the Servicing File shall be held by the Servicer as
custodian and bailee for the Trustee. All Mortgage Files and funds collected or
held by, or under the control of, the Servicer in respect of any Mortgage Loans,
whether from the collection of principal and interest payments or from
Liquidation Proceeds, including but not limited to, any funds on deposit in the
Servicer Custodial Account, shall be held by the Servicer for and on behalf of
the Trustee and shall be and remain the sole and exclusive property of the
Trustee, subject to the applicable provisions of this Agreement. The Servicer
also agrees that it shall not knowingly create, incur or subject any Mortgage
File or any funds that are deposited in the Servicer Custodial Account,
Certificate Account or any Escrow Account, or any funds that otherwise are or
may become due or payable to the Trustee for the benefit of the
Certificateholders, to any claim, lien, security interest, judgment, levy, writ
of attachment or other encumbrance created by the Servicer, or assert by legal
action or otherwise any claim or right of setoff against any Mortgage File or
any funds collected on, or in connection with, a Mortgage Loan, except, however,
that the Servicer shall be entitled to set off against and deduct from any such
funds any amounts that are properly due and payable to the Servicer under this
Agreement.
Section 3.17 Servicing Compensation.
The Servicer shall be entitled out of each payment of interest on a
Mortgage Loan (or portion thereof) and included in the Trust Estate to retain or
withdraw from the Servicer Custodial Account an amount equal to the Servicing
Fee for such Distribution Date.
Additional servicing compensation in the form of Excess Proceeds,
prepayment penalties, assumption fees, late payment charges and all income and
gain net of any losses realized from Permitted Investments and all other
customary and ancillary income and fees shall be retained by the Servicer to the
extent not required to be deposited in the Servicer Custodial Account pursuant
to Section 3.08(b). The Servicer shall be required to pay all expenses incurred
by it in connection with its servicing activities hereunder and shall not be
entitled to reimbursement therefor except as specifically provided in this
Agreement.
Notwithstanding the foregoing, with respect to the payment of the
Servicing Fee on any Distribution Date, the aggregate Servicing Fee for the
Servicer for such Distribution Date shall be reduced (but not below zero) by an
amount equal to the lesser of (a) the Prepayment Interest Shortfall for such
Distribution Date relating to the Mortgage Loans and (b) one-twelfth of % of the
aggregate Stated Principal Balance of such Mortgage Loans for such Distribution
Date (any such reduction, "Compensating Interest").
Section 3.18 Annual Statement as to Compliance.
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The Servicer shall deliver to the Trustee and each Rating Agency on or
before 90 days after the end of the Servicer's fiscal year, commencing with its
20 fiscal year, an Officer's Certificate stating, as to the signer thereof, that
(a) a review of the activities of the Servicer during the preceding calendar
year and of the performance of the Servicer under this Agreement has been made
under such officer's supervision, and (b) to the best of such officer's
knowledge, based on such review, the Servicer has fulfilled all its obligations
under this Agreement throughout such year, or, if there has been a default in
the fulfillment of any such obligation, specifying each such default known to
such officer and the nature and status thereof. Section 3.19 Annual Independent
Public Accountants' Servicing Statement; Financial Statements.
The Servicer shall, at its own expense, on or before 90 days after the
end of the Servicer's fiscal year, commencing with its 20 fiscal year, cause a
firm of independent public accountants (who may also render other services to
the Servicer or any affiliate thereof) which is a member of the American
Institute of Certified Public Accountants to furnish a statement to the Trustee
to the effect that such firm has with respect to the Servicer's overall
servicing operations, examined such operations in accordance with the
requirements of the Uniform Single Attestation Program for Mortgage Bankers,
stating such firm's conclusions relating thereto.
Section 3.20 Advances.
The Servicer shall determine on or before each Servicer Advance Date
whether it is required to make a Periodic Advance pursuant to the definition
thereof. If the Servicer determines it is required to make a Periodic Advance,
it shall, on or before the Servicer Advance Date, either (a) deposit into the
Servicer Custodial Account an amount equal to the Advance and/or (b) make an
appropriate entry in its records relating to the Servicer Custodial Account that
any portion of the Amount Held for Future Distribution in the Servicer Custodial
Account has been used by the Servicer in discharge of its obligation to make any
such Periodic Advance. Any funds so applied shall be replaced by the Servicer by
deposit in the Servicer Custodial Account no later than the close of business on
the Business Day preceding the next Servicer Advance Date. The Servicer shall be
entitled to be reimbursed from the Servicer Custodial Account for all Advances
of its own funds made pursuant to this Section 3.20 as provided in Section
3.11(a). The obligation to make Periodic Advances with respect to any Mortgage
Loan shall continue until the ultimate disposition of the REO Property or
Mortgaged Property relating to such Mortgage Loan. The Servicer shall inform the
Trustee of the amount of the Periodic Advance to be made by the Servicer on each
Servicer Advance Date no later than the related Remittance Date.
The Servicer shall deliver to the Trustee on the related Servicer
Advance Date an Officer's Certificate of a Servicing Officer indicating the
amount of any proposed Periodic Advance determined by the Servicer to be a
Nonrecoverable Advance. Notwithstanding anything to the contrary, the Servicer
shall not be required to make any Periodic Advance or Servicing Advance that
would be a Nonrecoverable Advance.
Section 3.21 Modifications, Waivers, Amendments and Consents.
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(a) Subject to this Section 3.21, the Servicer may agree to any
modification, waiver, forbearance, or amendment of any term of any Mortgage Loan
without the consent of the Trustee or any Certificateholder. All modifications,
waivers, forbearances or amendments of any Mortgage Loan shall be in writing and
shall be consistent with Customary Servicing Procedures.
(b) The Servicer shall not agree to enter into, and shall not enter
into, any modification, waiver (other than a waiver referred to in Section 3.13,
which waiver, if any, shall be governed by Section 3.13), forbearance or
amendment of any term of any Mortgage Loan if such modification, waiver,
forbearance, or amendment would:
(i) affect the amount or timing of any related payment of principal,
interest or other amount payable thereunder;
(ii) in the Servicer's judgment, materially impair the security for
such Mortgage Loan or reduce the likelihood of timely payment of amounts
due thereon; or
(iii) otherwise constitute a "significant modification" within the
meaning of Treasury Regulations Section 1.860G-2(b);
unless, in either case, (A) such Mortgage Loan is 90 days or more past due or
(B) the Servicer delivers to the Trustee an Opinion of Counsel to the effect
that such modification, waiver, forbearance or amendment would not affect the
REMIC status of either the Upper-Tier REMIC or the Lower-Tier REMIC and, in
either case, such modification, waiver, forbearance or amendment is reasonably
likely to produce a greater recovery with respect to such Mortgage Loan than
would liquidation. Subject to Customary Servicing Procedures, the Servicer may
permit a forbearance for a Mortgage Loan which in the Servicer's judgment is
subject to imminent default.
(c) Any payment of interest, which is deferred pursuant to any
modification, waiver, forbearance or amendment permitted hereunder, shall not,
for purposes hereof, including, without limitation, calculating monthly
distributions to Certificateholders, be added to the unpaid principal balance of
the related Mortgage Loan, notwithstanding that the terms of such Mortgage Loan
or such modification, waiver or amendment so permit.
(d) The Servicer may, as a condition to granting any request by a
Mortgagor for consent, modification, waiver, forbearance or amendment, the
granting of which is within the Servicer's discretion pursuant to the Mortgage
Loan and is permitted by the terms of this Agreement, require that such
Mortgagor pay to the Servicer, as additional servicing compensation, a
reasonable or customary fee for the additional services performed in connection
with such request, together with any related costs and expenses incurred by the
Servicer, which amount shall be retained by the Servicer as additional servicing
compensation.
(e) The Servicer shall notify the Trustee, in writing, of any
modification, waiver, forbearance or amendment of any term of any Mortgage Loan
and the date thereof, and shall deliver to the Trustee (or, at the direction of
the Trustee, the Custodian) for deposit in the related Mortgage File, an
original counterpart of the agreement relating to such modification, waiver,
forbearance or amendment, promptly (and in any event within ten Business Days)
following the execution thereof; provided, however, that if any such
modification, waiver, forbearance or
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amendment is required by applicable law to be recorded, the Servicer (i) shall
deliver to the Trustee a copy thereof and (ii) shall deliver to the Trustee such
document, with evidence of notification upon receipt thereof from the public
recording office.
Section 3.22 Reports to the Securities and Exchange Commission.
The Trustee shall, on behalf of the Trust, cause to be filed with the
Securities and Exchange Commission any periodic reports required to be filed
under the provisions of the Securities Exchange Act of 1934, as amended, and the
rules and regulations of the Securities and Exchange Commission thereunder, for
so long as any Certificates registered under the 1933 Act are outstanding (other
than the Current Report on Form 8-K to be filed by the Depositor in connection
with computational materials and the initial Current Report on Form 8-K to be
filed by the Depositor in connection with the issuance of the Certificates).
Upon the request of the Trustee, the Servicer and the Depositor shall cooperate
with the Trustee in the preparation of any such report and shall provide to the
Trustee in a timely manner all such information or documentation as the Trustee
may reasonably request in connection with the performance of its duties and
obligations under this Section.
ARTICLE IV
SERVICER'S CERTIFICATE
Section 4.01 Servicer's Certificate.
Each month, not later than 12:00 noon Eastern time on the Business Day
following each Determination Date, the Servicer shall deliver to the Trustee, a
Servicer's Certificate (in substance and format mutually acceptable to the
Servicer and the Trustee) certified by a Servicing Officer setting forth the
information necessary in order for the Trustee to perform its obligations under
this Agreement. The Trustee may conclusively rely upon the information contained
in a Servicer's Certificate for all purposes hereunder and shall have no duty to
verify or re-compute any of the information contained therein.
Each such statement shall be provided by the Trustee to any Holder of
a Certificate upon request and shall also, to the extent available, include
information regarding delinquencies on Mortgage Loans providing such statement,
indicating the number and aggregate principal amount of Mortgage Loans which are
either one, two, three or more than three months delinquent and the book value
of any REO Property.
ARTICLE V
PAYMENTS AND STATEMENTS TO CERTIFICATEHOLDERS;
REMIC ADMINISTRATION
Section 5.01 Distributions. On each Distribution Date, based solely on
the information in the Servicer's Certificate, the Trustee shall distribute out
of the Upper-Tier Certificate Account or the Certificate Account, as applicable,
(to the extent funds are available therein) to each Certificateholder of record
on the related Record Date (other than as provided in
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Section 10.01 respecting the final distribution) (a) by check mailed to such
Certificateholder entitled to receive a distribution on such Distribution Date
at the address appearing in the Certificate Register, or (b) upon written
request by the Holder of a Regular Certificate (in the event such
Certificateholder owns of record 100% of a Class of Certificates or holds
Certificates of any Class having denominations aggregating $1,000,000 or more),
by wire transfer or by such other means of payment as such Certificateholder and
the Trustee shall agree upon, such Certificateholder's Percentage Interest in
the amount to which the related Class of Certificates is entitled in accordance
with the priorities set forth below in Section 5.02.
None of the Holders of any Class of Certificates, the Depositor, the
Servicer or the Trustee shall in any way be responsible or liable to Holders of
any Class of Certificates in respect of amounts properly previously distributed
on any such Class.
Amounts distributed with respect to any Class of Certificates shall be
applied first to the distribution of interest thereon and then to principal
thereon. Section 5.02 Priorities of Distributions.
(a) On each Distribution Date, based solely on the information
contained in the Servicer's Certificate, the Trustee shall withdraw from the
Certificate Account (to the extent funds are available therein) (1) the amounts
payable to the Trustee pursuant to Sections 3.11(b)(i) and 3.11(b)(ii) and shall
pay such funds to itself, and (2) the Pool Distribution Amount, in an amount as
specified in written notice received by the Trustee from the Servicer no later
than the related Determination Date, and shall apply such funds, first, to
distributions in respect of the Uncertificated Lower-Tier Interests as specified
in this Section 5.02(a) for deposit in the Upper-Tier Certificate Account and to
the Class A-LR Certificate, and then from the Upper-Tier Certificate Account to
distributions on the Certificates in the following order of priority and to the
extent of such funds:
(i) to each Class of Senior Certificates (other than the Class A-PO
and Class A-LR Certificates), an amount allocable to interest equal to the
Interest Distribution Amount for such Class and any shortfall being
allocated among such Classes in proportion to the amount of the Interest
Distribution Amount that would have been distributed in the absence of such
shortfall;
(ii) concurrently to the Class A Certificates (other than the Class
A-PO and Class A-LR Certificates) and the Class A-PO Certificates, pro
rata, based on their respective Senior Principal Distribution Amount and PO
Principal Amount, (A) to the Class A Certificates (other than the Class
A-PO Certificates), in an aggregate amount up to the Senior Principal
Distribution Amount, such distribution to be allocated among such Classes
in accordance with Section 5.02(b) and (B) to the Class A-PO Certificates
in an aggregate amount up to the PO Principal Amount;
(iii) to the Class A-PO Certificates, any Class A-PO Deferred Amount,
up to the Subordinate Principal Distribution Amount for such Distribution
Date from amounts otherwise distributable first to the Class B-6
Certificates pursuant to clause (iv)(L) below, second to the Class B-5
Certificates pursuant to clause (iv)(J) below, third to the Class B-
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4 Certificates pursuant to clause (iv)(H) below, fourth to the Class B-3
Certificates pursuant to clause (iv)(F) below, fifth to the Clause B-2
Certificates pursuant to clause (iv)(D) below and finally to the Class B-1
Certificates pursuant to clause (iv)(B) below;
(iv) to each Class of Subordinate Certificates, subject to paragraph
(d) below, in the following order of priority:
(A) to the Class B-1 Certificates, an amount allocable to
interest equal to the Interest Distribution Amount for such Class for
such Distribution Date;
(B) to the Class B-1 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date less
any amount used to pay the Class A-PO Deferred Amount pursuant to
clause (iii) above until the Class Certificate Balance thereof has
been reduced to zero;
(C) to the Class B-2 Certificates, an amount allocable to
interest equal to the Interest Distribution Amount for such Class for
such Distribution Date;
(D) to the Class B-2 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date less
any amount used to pay the Class A-PO Deferred Amount pursuant to
clause (iii) above until the Class Certificate Balance thereof has
been reduced to zero;
(E) to the Class B-3 Certificates, an amount allocable to
interest equal to the Interest Distribution Amount for such Class for
such Distribution Date;
(F) to the Class B-3 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date less
any amount used to pay the Class A-PO Deferred Amount pursuant to
clause (iii) above until the Class Certificate Balance thereof has
been reduced to zero;
(G) to the Class B-4 Certificates, an amount allocable to
interest equal to the Interest Distribution Amount for such Class for
such Distribution Date;
(H) to the Class B-4 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date less
any amount used to pay the Class A-PO Deferred Amount pursuant to
clause (iii) above until the Class Certificate Balance thereof has
been reduced to zero;
(I) to the Class B-5 Certificates, an amount allocable to
interest equal to the Interest Distribution Amount for such Class for
such Distribution Date;
(J) to the Class B-5 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date less
any amount used to pay the Class A-PO Deferred Amount pursuant to
clause (iii) above until the Class Certificate Balance thereof has
been reduced to zero;
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(K) to the Class B-6 Certificates, an amount allocable to
interest equal to the Interest Distribution Amount for such Class for
such Distribution Date; and
(L) to the Class B-6 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date less
any amount used to pay the Class A-PO Deferred Amount pursuant to
clause (iii) above until the Class Certificate Balance thereof has
been reduced to zero; and
(v) to the Holder of the Class A-R Certificate, any amounts remaining
in the Upper-Tier Certificate Account, and to the Holder of the Class A-LR
Certificate, any remaining Pool Distribution Amount.
On any Distribution Date, amounts distributed in respect of Class A-PO
Deferred Amounts will not reduce the Class Certificate Balance of the Class A-PO
Certificates.
All distributions in respect of the Interest Distribution Amount for a
Class will be applied first with respect to the amount payable pursuant to
clause (i) of the definition of "Interest Distribution Amount," and second with
respect to the amount payable pursuant to clause (ii) of such definition.
On each Distribution Date, each Uncertificated Lower-Tier Interest
shall receive distributions in respect of principal in an amount equal to the
amount of principal distributed to their respective Corresponding Upper-Tier
Class or Classes as provided herein. On each Distribution Date, each
Uncertificated Lower-Tier Interest shall receive distributions in respect of
interest in an amount equal to the Interest Distribution Amounts in respect of
its Corresponding Upper-Tier Class or Classes, in each case to the extent
actually distributed thereon. Such amounts distributed to the Uncertificated
Lower-Tier Interests in respect of principal and interest with respect to any
Distribution Date are referred to herein collectively as the "Lower-Tier
Distribution Amount."
As of any date, the principal balance (or, in the case of the Class
A-LWIO Interest, the notional amount) of each Uncertificated Lower-Tier Interest
equals the aggregate of the Class Certificate Balances of the respective
Corresponding Upper-Tier Class or Classes (or, in the case of the Class A-WIO
Certificates, the Class A-WIO Notional Amount). The initial principal balance of
each Uncertificated Lower-Tier Interest equals the aggregate of the Initial
Class Certificate Balances (or notional amount) of the respective Corresponding
Upper-Tier Class or Classes.
The pass-through rate with respect to the Class A-L1 Interest, Class
A-LUR Interest, Class B-L1 Interest, Class B-L2 Interest, Class B-L3 Interest,
Class B-L4 Interest, Class B-L5 Interest and Class B-L6 Interest shall be ____%
per annum. The pass-through rate with respect to the Class A-L3 Interest shall
be ____% per annum. The pass-through rate with respect to the Class A-L4
Interest shall be ____% per annum. The pass-through rate with respect to the
Class A-LWIO Interest shall be a per annum rate equal to (i) the weighted
average of the Net Mortgage Interest Rates of the Premium Mortgage Loans (based
on the Stated Principal Balance of the Premium Mortgage Loans on the Due Date in
the month preceding the month of such Distribution Date minus (ii) ____%. The
Class A-LPO Interest is a principal-
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only interest and is not entitled to distributions of interest. Any
Non-Supported Interest Shortfalls will be allocated to each Uncertificated
Lower-Tier Interest in the same relative proportions as interest is allocated to
such Uncertificated Lower-Tier Interest.
(b) (i) On each Distribution Date prior to the Senior Credit Support
Depletion Date, the amount distributable to the Class A Certificates (other than
the Class A-PO Certificates) pursuant to Section 5.02(a)(ii) for such
Distribution Date, will be distributed in the following order of priority:
[To Be Provided]
On each Distribution Date on or after the Senior Credit Support
Depletion Date, notwithstanding the allocation and priority set forth above, the
portion of the Pool Distribution Amount available to be distributed as principal
of the Class A Certificates (other than the Class A-PO Certificates) shall be
distributed concurrently, as principal, on such Classes, pro rata, on the basis
of their respective Class Certificate Balances, until the Class Certificate
Balances thereof are reduced to zero.
(c) On each Distribution Date, Accrued Certificate Interest for each
Class of Certificates for such Distribution Date shall be reduced by such
Class's pro rata share, based on such Class's Interest Distribution Amount for
such Distribution Date, without taking into account the allocation made by this
Section 5.02(c), of (A) Non-Supported Interest Shortfalls, (B) any Excess Losses
allocable to interest, (C) on and after the Senior Credit Support Depletion
Date, any other Realized Loss allocable to interest and (D) each Relief Act
Reduction incurred during the calendar month preceding the month of such
Distribution Date.
(d) Notwithstanding the priority and allocation contained in Section
5.02(a)(iv), if with respect to any Class of Subordinate Certificates on any
Distribution Date, (i) the aggregate of the Class Certificate Balances
immediately prior to such Distribution Date of all Classes of Subordinate
Certificates which have a higher numerical Class designation than such Class,
divided by (ii) the aggregate Class Certificate Balance of all the Certificates
(other than the Class A-PO Certificates) immediately prior to such Distribution
Date (the "Fractional Interest") is less than the Original Fractional Interest
for such Class, no distribution of principal will be made to any Classes junior
to such Class (the "Restricted Classes") and the Class Certificate Balances of
the Restricted Classes will not be used in determining the Pro Rata Share for
the Subordinate Certificates that are not Restricted Classes. Any funds
remaining will be distributed in the order provided in Section 5.02(a)(iv).
Section 5.03 Allocation of Losses.
(a) On or prior to each Determination Date, the Servicer shall inform
the Trustee in writing with respect to each Mortgage Loan: (1) whether any
Realized Loss is a Deficient Valuation or a Debt Service Reduction, (2) of the
amount of such loss or Deficient Valuation, or of the terms of such Debt Service
Reduction and (3) of the total amount of Realized Losses. Based on such
information, the Trustee shall determine the total amount of Realized Losses
with respect to the related Distribution Date.
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The principal portion of Realized Losses with respect to any
Distribution Date shall be allocated as follows:
(i) the applicable PO Percentage of the principal portion of any
Realized Loss with respect to a Discount Mortgage Loan shall be allocated
to the Class A-PO Certificates until the Class Certificate Balance thereof
is reduced to zero; and
(ii) the applicable Non-PO Percentage of the principal portion of any
Realized Loss shall be allocated first to the Subordinate Certificates in
reverse order of their respective numerical Class designations (beginning
with the Class of Subordinate Certificates then outstanding with the
highest numerical Class designation) until the respective Class Certificate
Balance of each such Class is reduced to zero, and second to the Senior
Certificates (other than the Class A-PO Certificates), pro rata, on the
basis of their respective Class Certificate Balances immediately prior to
the related Distribution Date, until the Class Certificate Balances thereof
have been reduced to zero; and
(b) The Class Certificate Balance of the Class A-PO Certificates shall
be reduced on each Distribution Date by the amount, if any, by which the Class
Certificate Balance of the Class A-PO Certificates (after giving effect to the
amount to be distributed as a distribution of principal and the allocation of
Realized Losses on such Distribution Date) exceeds the Adjusted Pool Amount (PO
Portion) for such Distribution Date.
The Class Certificate Balance of the Class of Subordinate Certificates
then outstanding with the highest numerical Class designation shall be reduced
on each Distribution Date by the amount, if any, by which the aggregate of the
Class Certificate Balances of all outstanding Classes of Certificates (after
giving effect to the amount to be distributed as a distribution of principal and
the allocation of Realized Losses and Class A-PO Deferred Amounts on such
Distribution Date) exceeds the Adjusted Pool Amount for such Distribution Date.
After the Senior Credit Support Depletion Date, the Class Certificate
Balances of the Senior Certificates in the aggregate (other than the Class
Certificate Balance of the Class A-PO Certificates) shall be reduced on each
Distribution Date by the amount, if any, by which the aggregate of the Class
Certificate Balances of all outstanding Classes of Senior Certificates (other
than Class A-PO Certificates) (after giving effect to the amount to be
distributed as a distribution of principal and the allocation of Realized Losses
on such Distribution Date) exceeds the difference between (i) the Adjusted Pool
Amount for such Distribution Date and (ii) the Adjusted Pool Amount (PO Portion)
for such Distribution Date.
Any such reduction shall be allocated among the Senior Certificates
(other than the Class A-PO Certificates) based on the Class Certificate Balances
immediately prior to such Distribution Date.
(c) Any Realized Loss allocated to a Class of Certificates or any
reduction in the Class Certificate Balance of a Class of Certificates pursuant
to Section 5.03(b) above shall be allocated among the Certificates of such Class
in proportion to their respective Percentage Interests.
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(d) Any allocation of Realized Losses to a Class of Certificates or
any reduction in the Class Certificate Balance of a Class pursuant to Section
5.03(b) above shall be accomplished by reducing the Class Certificate Balance
thereof prior to the distributions made on the related Distribution Date in
accordance with the definition of "Class Certificate Balance."
(e) With respect to any Distribution Date, Realized Losses allocated
pursuant to this Section 5.03 will be allocated to each Uncertificated
Lower-Tier Interest in an amount equal to the amount allocated to its respective
Corresponding Upper-Tier Class or Classes as provided above.
Section 5.04 Statements to Certificateholders.
(a) Prior to the Distribution Date in each month, based upon the
information provided to the Trustee on the Servicer's Certificates delivered to
the Trustee pursuant to Section 4.01, the Trustee shall determine the following
information with respect to such Distribution Date:
(i) the amount allocable to principal, separately identifying the
aggregate amount of any Principal Prepayments and Liquidation Proceeds
included therein;
(ii) the amount allocable to interest, any Class Unpaid Interest
Shortfall included in such distribution and any remaining Class Unpaid
Interest Shortfall after giving effect to such distribution;
(iii) if the distribution to the Holders of such Class of Certificates
is less than the full amount that would be distributable to such Holders if
there were sufficient funds available therefor, the amount of the shortfall
and the allocation thereof as between principal and interest;
(iv) the Class Certificate Balance of each Class of Certificates after
giving effect to the distribution of principal on such Distribution Date;
(v) the Pool Stated Principal Balance for the following Distribution
Date;
(vi) the Senior Percentage, the Priority Percentage and the
Subordinate Percentage for the following Distribution Date;
(vii) the amount of the Servicing Fee paid to or retained by the
Servicer with respect to such Distribution Date;
(viii) the Pass-Through Rate for each such Class of Certificates with
respect to such Distribution Date;
(ix) the amount of Periodic Advances included in the distribution on
such Distribution Date and the aggregate amount of Periodic Advances
outstanding as of the close of business on such Distribution Date;
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(x) the number and aggregate principal amounts of Mortgage Loans (A)
delinquent (exclusive of Mortgage Loans in foreclosure) (1) 1 to 30 days
(2) 31 to 60 days (3) 61 to 90 days and (4) 91 or more days and (B) in
foreclosure, as of the close of business on the last day of the calendar
month preceding such Distribution Date;
(xi) with respect to any Mortgage Loan that became an REO Property
during the preceding calendar month, the loan number and Stated Principal
Balance of such Mortgage Loan as of the close of business on the
Determination Date preceding such Distribution Date and the date of
acquisition thereof;
(xii) the total number and principal balance of any REO Properties
(and market value, if available) as of the close of business on the
Determination Date preceding such Distribution Date;
(xiii) the Senior Prepayment Percentage and the Subordinate Prepayment
Percentage for the following Distribution Date; (xiv) the aggregate amount
of Realized Losses incurred during the preceding calendar month or any
Class A-PO Deferred Amounts for such Distribution Date.
(xv) in the case of the Class A-5 Certificates, the Class A-5 Notional
Amount;
(xvi) in the case of the Class A-WIO Certificates, the Class A-WIO
Notional Amount for such Distribution Date.
(b) No later than each Distribution Date, the Trustee, based upon
information supplied to it on the Servicer's Certificates, shall prepare and
deliver (by mail, fax or electronically) to each Holder of a Certificate, each
Rating Agency and the Servicer a statement setting forth the information set
forth in Section 5.04(a).
In the case of information furnished pursuant to clauses (i), (ii) and
(ix) of Section 5.04(a), the amounts shall be expressed as a dollar amount per
Certificate with a $1,000 denomination.
On each Distribution Date, the Trustee shall prepare and furnish to
each Financial Market Service, in electronic or such other format and media
mutually agreed upon by the Trustee, the Financial Market Service and the
Depositor, the information contained in the statement described in Section
5.04(a) for such Distribution Date.
The Trustee may make available each month, to any interested party,
the monthly statement to Certificateholders via the Trustee's website.
Within a reasonable period of time after the end of each calendar
year, the Trustee shall furnish to each Person who at any time during the
calendar year was the Holder of a Certificate, if requested in writing by such
Person, a statement containing the information set forth in clauses (i), (ii)
and (vii) of Section 5.04(a), in each case aggregated for such calendar year or
applicable portion thereof during which such Person was a Certificateholder.
Such obligation of the Trustee shall be deemed to have been satisfied to the
extent that substantially
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comparable information shall be provided by the Trustee pursuant to any
requirements of the Code as from time to time in force.
The Trustee shall deliver to the Holders of Certificates any reports
or information the Trustee is required by this Agreement or the Code, Treasury
Regulations or REMIC Provisions to deliver to the Holders of Certificates, and
the Trustee shall prepare and provide to the Certificateholders (by mail,
telephone, or publication as may be permitted by applicable Treasury
Regulations) such other reasonable information as the Trustee deems necessary or
appropriate or is required by the Code, Treasury Regulations, and the REMIC
Provisions including, but not limited to, (i) information to be reported to the
Holders of the Residual Certificates for quarterly notices on Schedule Q (Form
1066) (which information shall be forwarded to the Holders of the Residual
Certificates by the Trustee), (ii) information to be provided to the Holders of
Certificates with respect to amounts which should be included as interest and
original issue discount in such Holders' gross income and (iii) information to
be provided to all Holders of Certificates setting forth the percentage of each
REMIC's assets, determined in accordance with Treasury Regulations using a
convention, not inconsistent with Treasury Regulations, selected by the Trustee
in its absolute discretion, that constitute real estate assets under Section 856
of the Code, and assets described in Section 7701(a)(19)(C) of the Code;
provided, however, that in setting forth the percentage of such assets of each
REMIC, nothing contained in this Agreement, including without limitation Section
7.03 hereof, shall be interpreted to require the Trustee periodically to
appraise the fair market values of the assets of the Trust Estate or to
indemnify the Trust Estate or any Certificateholders from any adverse federal,
state or local tax consequences associated with a change subsequently required
to be made in the Depositor's initial good faith determinations of such fair
market values (if subsequent determinations are required pursuant to the REMIC
Provisions) made from time to time.
Section 5.05 Tax Returns and Reports to Certificateholders.
(a) For federal income tax purposes, each REMIC shall have a calendar
year taxable year and shall maintain its books on the accrual method of
accounting.
(b) The Trustee shall prepare or cause to be prepared, shall execute
and shall file or cause to be filed with the Internal Revenue Service and
applicable state or local tax authorities income tax information returns for
each taxable year with respect to each REMIC containing such information at the
times and in the manner as may be required by the Code, the Treasury Regulations
or state or local tax laws, regulations, or rules, and shall furnish or cause to
be furnished to each REMIC and the Certificateholders the schedules, statements
or information at such times and in such manner as may be required thereby.
Within 30 days of the Closing Date, the Trustee shall furnish or cause to be
furnished to the Internal Revenue Service, on Form 8811 or as otherwise required
by the Code or the Treasury Regulations, the name, title, address and telephone
number of the person that Holders of the Certificates may contact for tax
information relating thereto, together with such additional information at the
time or times and in the manner required by the Code or the Treasury
Regulations. Such federal, state, or local income tax or information returns
shall be signed by the Trustee, or such other Person as may be required to sign
such returns by the Code, the Treasury Regulations or state or local tax laws,
regulations, or rules.
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(c) In the first federal income tax return of each REMIC for its short
taxable year ending December 31, 200 , REMIC status shall be elected for such
taxable year and all succeeding taxable years.
(d) The Trustee will maintain or cause to be maintained such records
relating to each REMIC, including but not limited to records relating to the
income, expenses, assets and liabilities of the Trust Estate, and the initial
fair market value and adjusted basis of the Trust Estate property and assets
determined at such intervals as may be required by the Code or the Treasury
Regulations, as may be necessary to prepare the foregoing returns, schedules,
statements or information.
Section 5.06 Tax Matters Person. The Tax Matters Person shall have the
same duties with respect to each REMIC as those of a "tax matters partner" under
Subchapter C of Chapter 63 of Subtitle F of the Code. The Holder of the Class
A-R Certificate is hereby designated as the Tax Matters Person for the
Upper-Tier REMIC. The Holder of the Class A-LR Certificate is hereby designated
as the Tax Matters Person for the Lower-Tier REMIC. By their acceptance of the
Class A-R or Class A-LR Certificate, as applicable, each such Holder irrevocably
appoints the Trustee as its agent to perform all of the duties of the Tax
Matters Person for the Upper-Tier REMIC and the Lower-Tier REMIC.
Section 5.07 Rights of the Tax Matters Person in Respect of the
Trustee. The Trustee shall afford the Tax Matters Person, upon reasonable notice
during normal business hours, access to all records maintained by the Trustee in
respect of its duties hereunder and access to officers of the Trustee
responsible for performing such duties. Upon request, the Trustee shall furnish
the Tax Matters Person with its most recent report of condition published
pursuant to law or to the requirements of its supervisory or examining authority
publicly available. The Trustee shall make available to the Tax Matters Person
such books, documents or records relating to the Trustee's services hereunder as
the Tax Matters Person shall reasonably request. The Tax Matters Person shall
not have any responsibility or liability for any action or failure to act by the
Trustee and is not obligated to supervise the performance of the Trustee under
this Agreement or otherwise.
Section 5.08 REMIC Related Covenants. For as long as the Trust shall
exist, the Trustee, the Depositor and the Servicer shall act in accordance
herewith to assure continuing treatment of the Upper-Tier REMIC and the
Lower-Tier REMIC as REMICs and avoid the imposition of tax on either REMIC. In
particular:
(a) The Trustee shall not create, or permit the creation of, any
"interests" in either REMIC within the meaning of Code Section 860D(a)(2) other
than the interests represented by the Regular Certificates, the Residual
Certificates and the Uncertificated Lower-Tier Interests.
(b) Except as otherwise provided in the Code, (i) the Depositor and
the Servicer shall not contribute to the Trust Estate and the Trustee shall not
accept property unless substantially all of the property held in each REMIC
constitutes either "qualified mortgages" or "permitted investments" as defined
in Code Sections 860G(a)(3) and (5), respectively, and (ii) no property shall be
contributed to each REMIC after the start-up day unless such contribution
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would not subject the Trust Estate to the 100% tax on contributions to a REMIC
after the start-up day of the REMIC imposed by Code Section 860G(d).
(c) The Trustee shall not accept on behalf of either REMIC any fee or
other compensation for services and neither the Trustee nor the Servicer shall
knowingly accept, on behalf of the Trust Estate any income from assets other
than those permitted to be held by a REMIC.
(d) The Trustee shall not sell or permit the sale of all or any
portion of the Mortgage Loans (other than in accordance with Sections 2.02, 2.04
or 3.14(b)), unless such sale is pursuant to a "qualified liquidation" of the
applicable REMIC as defined in Code Section 860F(a)(4)(A) and in accordance with
Article X.
(e) The Trustee shall maintain books with respect to the Trust and
each REMIC on a calendar year taxable year and on an accrual basis.
Neither the Servicer nor the Trustee shall engage in a "prohibited
transaction" (as defined in Code Section 860F(a)(2)), except that, with the
prior written consent of the Servicer and the Depositor, the Trustee may engage
in the activities otherwise prohibited by the foregoing paragraphs (b), (c) and
(d); provided that the Servicer shall have delivered to the Trustee an Opinion
of Counsel to the effect that such transaction will not result in the imposition
of a tax on either REMIC and will not disqualify the Trust Estate from treatment
as two REMICs; and, provided further, that the Servicer shall have demonstrated
to the satisfaction of the Trustee that such action will not adversely affect
the rights of the Holders of the Certificates and the Trustee and that such
action will not adversely impact the rating of the Certificates.
Section 5.09 Determination of LIBOR. On each Rate Determination Date
for a Class of LIBOR Certificates, the Trustee shall determine LIBOR for the
applicable Distribution Date on the basis of the British Bankers' Association
("BBA") "Interest Settlement Rate" for one-month deposits in U.S. Dollars as
found on Telerate page 3750 as of 11:00 A.M. London time on such Rate
Determination Date. As used herein, "Telerate page 3750" means the display
designated as page 3750 on the Bridge Telerate Service.
If on any Rate Determination Date for a Class of LIBOR Certificates,
the Trustee is unable to determine LIBOR on the basis of the method set forth in
the preceding paragraph, LIBOR for the applicable Distribution Date will be
whichever is higher of (x) LIBOR as determined on the previous Rate
Determination Date for such Class of LIBOR Certificates or (y) the Reserve
Interest Rate. The "Reserve Interest Rate" will be the rate per annum which the
Trustee determines to be either (A) the arithmetic mean (rounding such
arithmetic mean upwards if necessary to the nearest whole multiple of 1/16%) of
the one-month U.S. Dollar lending rates that New York City banks selected by the
Trustee are quoting, on the relevant Rate Determination Date, to the principal
London offices of at least two leading banks in the London interbank market or
(B) in the event that the Trustee can determine no such arithmetic mean, the
lowest one-month U.S. Dollar lending rate that the New York City banks selected
by the Trustee are quoting on such Rate Determination Date to leading European
banks.
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If on any Rate Determination Date for a Class of LIBOR Certificates,
the Trustee is required but is unable to determine the Reserve Interest Rate in
the manner provided in the preceding paragraph, LIBOR for the applicable
Distribution Date will be LIBOR as determined on the previous Rate Determination
Date for such Class of LIBOR Certificates, or, in the case of the first Rate
Determination Date, % per annum.
The establishment of LIBOR by the Trustee and the Trustee's subsequent
calculation of the rates of interest applicable to each of the LIBOR
Certificates in the absence of manifest error, will be final and binding. After
a Rate Determination Date, the Trustee shall provide the Pass-Through Rates of
the LIBOR Certificates for the related Distribution Date to Beneficial Owners or
Holders of LIBOR Certificates who place a telephone call to the Trustee at and
make a request therefor.
ARTICLE VI
THE CERTIFICATES
Section 6.01 The Certificates. The Classes of Senior Certificates and
the Subordinate Certificates shall be substantially in the forms set forth in
Exhibits A-1, A-2, A-3, A-4, A-5, A-6, A-PO, A-WIO, A-R, A-LR, B-1, B-2, B-3,
B-4, B-5, B-6 and C (reverse of all Certificates) and shall, on original issue,
be executed by the Trustee and shall be countersigned and delivered by the
Trustee to or upon the order of the Depositor upon receipt by the Trustee of the
documents specified in Section 2.01. The Senior Certificates (other than the
Class A-PO, Class A-WIO and Class A-R Certificates) shall be available to
investors in interests representing minimum dollar Certificate Balances (or
notional amounts) of $ and integral multiples of $ in excess thereof. The Class
A-WIO Certificates shall be available to investors in interests representing
minimum dollar Certificate Balances of $ and integral multiples of $ in excess
thereof. The Subordinate Certificates and the Class A-PO Certificates shall be
available to investors in interests representing minimum dollar Certificate
Balances of $ and integral dollar multiples of $ in excess thereof (except one
Certificate of such Class may be issued with a different Certificate Balance.
The Class A-R and Class A-LR Certificates shall be in a minimum denomination of
$ . The Senior Certificates (other than the Class A-R and Class A-LR
Certificates) and the Class B-1, Class B-2 and Class B-3 Certificates shall
initially be issued in book-entry form through the Depository and delivered to
the Depository or, pursuant to the Depository's instructions on behalf of the
Depository to, and deposited with, the Certificate Custodian, and all other
Classes of Certificates shall initially be issued in definitive,
fully-registered form.
The Certificates shall be executed by manual or facsimile signature on
behalf of the Trustee by an authorized officer or signatory. Certificates
bearing the manual or facsimile signatures of individuals who were, at the time
when such signatures were affixed, authorized to sign on behalf of the Trustee
shall bind the Trustee, notwithstanding that such individuals or any of them
have ceased to be so authorized prior to the execution and delivery of such
Certificates or did not hold such offices or positions at the date of such
Certificate. No Certificate shall be entitled to any benefit under this
Agreement, or be valid for any purpose, unless such Certificate shall have been
manually countersigned by the Trustee substantially in the form provided for
herein, and such countersignature upon any Certificate shall be conclusive
evidence, and the only
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evidence, that such Certificate has been duly authenticated and delivered
hereunder. All Certificates shall be dated the date of their countersignature.
Section 6.02 Registration of Transfer and Exchange of Certificates.
(a) The Trustee shall cause to be kept at an office or agency in the
city in which the Corporate Trust Office of the Trustee is located a Certificate
Register in which, subject to such reasonable regulations as it may prescribe,
the Trustee shall provide for the registration of Certificates and of transfers
and exchanges of Certificates as herein provided. The Trustee shall initially
serve as Certificate Registrar for the purpose of registering Certificates and
transfers and exchanges of Certificates as herein provided.
(b) At the option of the Certificateholders, Certificates may be
exchanged for other Certificates of authorized denominations of a like Class,
tenor and aggregate Percentage Interest, upon surrender of the Certificates to
be exchanged at any such office or agency. Whenever any Certificates are so
surrendered for exchange, the Trustee shall execute and the Trustee shall
authenticate, countersign and deliver the Certificates which the
Certificateholder making the exchange is entitled to receive. Every Certificate
presented or surrendered for transfer or exchange shall (if so required by the
Trustee or the Certificate Registrar) be duly endorsed by, or be accompanied by
a written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by, the Holder thereof or its attorney duly
authorized in writing.
(c) (i) Except as provided in paragraph (c)(iii) below, the Book-Entry
Certificates shall at all times remain registered in the name of the
Depository or its nominee and at all times: (A) registration of the
Certificates may not be transferred by the Trustee except to another
Depository; (B) the Depository shall maintain book-entry records with
respect to the Certificate Owners and with respect to ownership and
transfers of such Book-Entry Certificates; (C) ownership and transfers of
registration of the Book-Entry Certificates on the books of the Depository
shall be governed by applicable rules established by the Depository; (D)
the Depository may collect its usual and customary fees, charges and
expenses from its Depository Participants; (E) the Trustee shall deal with
the Depository as the representative of the Certificate Owners of the
Book-Entry Certificates for purposes of exercising the rights of Holders
under this Agreement, and requests and directions for and votes of the
Depository shall not be deemed to be inconsistent if they are made with
respect to different Certificate Owners; and (F) the Trustee may rely and
shall be fully protected in relying upon information furnished by the
Depository with respect to its Depository Participants and furnished by the
Depository Participants with respect to indirect participating firms and
persons shown on the books of such indirect participating firms as direct
or indirect Certificate Owners.
(ii) All transfers by Certificate Owners of Book-Entry Certificates
shall be made in accordance with the procedures established by the
Depository Participant or brokerage firm representing such Certificate
Owner. Each Depository Participant shall only transfer Book-Entry
Certificates of Certificate Owners it represents or of brokerage firms for
which it acts as agent in accordance with the Depository's normal
procedures.
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(iii) If (A) (1) the Depository or the Depositor advises the Trustee
in writing that the Depository is no longer willing or able to properly
discharge its responsibilities as Depository, and (2) the Trustee or the
Depositor is unable to locate a qualified successor, (B) the Depositor at
its option advises the Trustee in writing that it elects to terminate the
book-entry system through the Depository or (C) after the occurrence of an
Event of Default, Certificate Owners representing at least 51% of the
aggregate Class Certificate Balances of the Book-Entry Certificates
together advise the Trustee and the Depository through the Depository
Participants in writing that the continuation of a book-entry system
through the Depository is no longer in the best interests of the
Certificate Owners, the Trustee shall notify all Certificate Owners,
through the Depository, of the occurrence of any such event and of the
availability of definitive, fully-registered Certificates (the "Definitive
Certificates") to Certificate Owners requesting the same. Upon surrender to
the Trustee of the related Class of Certificates by the Depository (or by
the Certificate Custodian, if it holds such Class on behalf of the
Depository), accompanied by the instructions from the Depository for
registration, the Trustee shall issue the Definitive Certificates. None of
the Servicer, the Depositor or the Trustee shall be liable for any delay in
delivery of such instruction and may conclusively rely on, and shall be
protected in relying on, such instructions. The Depositor shall provide the
Trustee with an adequate inventory of certificates to facilitate the
issuance and transfer of Definitive Certificates. Upon the issuance of
Definitive Certificates, the Trustee shall recognize the Holders of the
Definitive Certificates as Certificateholders hereunder.
(d) No transfer of a Private Certificate shall be made unless such
transfer is exempt from the registration requirements of the 1933 Act and any
applicable state securities laws or is made in accordance with the 1933 Act and
such laws. In the event of any such transfer, (i) unless such transfer is made
in reliance on Rule 144A under the 1933 Act, the Trustee or the Depositor may
require a written Opinion of Counsel (which may be in-house counsel) acceptable
to and in form and substance reasonably satisfactory to the Trustee and the
Depositor that such transfer may be made pursuant to an exemption, describing
the applicable exemption and the basis therefor, from the 1933 Act and such laws
or is being made pursuant to the 1933 Act and such laws, which Opinion of
Counsel shall not be an expense of the Trustee or the Depositor and (ii) the
Trustee shall require a certificate from the Certificateholder desiring to
effect such transfer substantially in the form attached hereto as Exhibit G-1
and a certificate from such Certificateholder's prospective transferee
substantially in the form attached hereto either as Exhibit G-2A or as Exhibit
G-2B, which certificates shall not be an expense of the Trustee or the
Depositor; provided that the foregoing requirements under clauses (i) and (ii)
shall not apply to a transfer of a Private Certificate between or among the
Depositor, the Seller, their affiliates or both. The Depositor shall provide to
any Holder of a Private Certificate and any prospective transferees designated
by any such Holder, information regarding the related Certificates and the
Mortgage Loans and such other information as shall be necessary to satisfy the
condition to eligibility set forth in Rule 144A(d)(4) for transfer of any such
certificate without registration thereof under the 1933 Act pursuant to the
registration exemption provided by Rule 144A. The Holder of a Private
Certificate desiring to effect such transfer shall, and does hereby agree to,
indemnify the Trustee and the Depositor against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.
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(e) No transfer of an ERISA Restricted Certificate shall be made
unless the transferee delivers to the Trustee either (i) a representation letter
in the form of Exhibit H from the transferee of such Certificate, which
representation letter shall not be an expense of the Depositor, the Trustee or
the Servicer, or (ii) in the case of any ERISA Restricted Certificate presented
for registration in the name of an employee benefit plan or arrangement,
including an individual retirement account, subject to ERISA, the Code, or any
federal, state or local law ("Similar Law") which is similar to ERISA or the
Code (collectively, a "Plan"), or a trustee or custodian of any of the
foregoing, an Opinion of Counsel in form and substance satisfactory to the
Trustee and the Servicer to the effect that the purchase or holding of such
ERISA Restricted Certificate by or on behalf of such Plan will not result in the
assets of the Trust Estate being deemed to be "plan assets" and subject to the
prohibited transaction provisions of ERISA, the Code or Similar Law and will not
subject the Trustee, the Depositor or the Servicer to any obligation in addition
to those undertaken in this Agreement, which Opinion of Counsel shall not be an
expense of the Trustee or the Servicer. Any transferee of an ERISA Restricted
Certificate that does not comply with either clause (i) or (ii) of the preceding
sentence will be deemed to have made one of the representations set forth in
Exhibit H. Notwithstanding anything else to the contrary herein, any purported
transfer of an ERISA Restricted Certificate to or on behalf of a Plan without
the delivery to the Trustee and the Servicer of an Opinion of Counsel
satisfactory to the Trustee and the Servicer as described above shall be void
and of no effect.
Neither the Trustee nor the Certificate Registrar shall have any
liability for transfers of Book-Entry Certificates made through the book-entry
facilities of the Depository or between or among any Depository Participants or
Certificate Owners, made in violation of applicable restrictions. The Trustee
may rely and shall be fully protected in relying upon information furnished by
the Depository with respect to its Depository Participants and furnished by the
Depository Participants with respect to indirect participating firms and Persons
shown on the books of such indirect participating firms as direct or indirect
Certificate Owners.
To the extent permitted under applicable law (including, but not
limited to, ERISA), the Trustee shall be under no liability to any Person for
any registration of transfer of any ERISA Restricted Certificate that is in fact
not permitted by this Section 6.02 or for making any payments due on such
Certificate to the Holder thereof or taking any other action with respect to
such Holder under the provisions of this Agreement so long as the transfer was
registered by the Trustee in accordance with the foregoing requirements.
(f) Each Person who has or who acquires any Ownership Interest in a
Residual Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions, and
the rights of each Person acquiring any Ownership Interest in a Residual
Certificate are expressly subject to the following provisions:
(i) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall be a Permitted Transferee and shall promptly
notify the Trustee of any change or impending change in its status as a
Permitted Transferee.
(ii) No Person shall acquire an Ownership Interest in a Residual
Certificate unless such Ownership Interest is a pro rata undivided
interest.
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(iii) In connection with any proposed transfer of any Ownership
Interest in a Residual Certificate, the Trustee shall require delivery to
it, in form and substance satisfactory to it, of an affidavit in the form
of Exhibit I hereto from the proposed transferee.
(iv) Notwithstanding the delivery of an affidavit by a proposed
transferee under clause (iii) above, if a Responsible Officer of the
Trustee has actual knowledge that the proposed transferee is not a
Permitted Transferee, no transfer of any Ownership Interest in a Residual
Certificate to such proposed transferee shall be effected.
(v) No Ownership Interest in a Residual Certificate may be purchased
by or transferred to any Person that is not a U.S. Person, unless (A) such
Person holds such Residual Certificate in connection with the conduct of a
trade or business within the United States and furnishes the transferor and
the Trustee with an effective Internal Revenue Service Form W-8ECI (or
successor thereto) or (B) the transferee delivers to both the transferor
and the Trustee an Opinion of Counsel from a nationally-recognized tax
counsel to the effect that such transfer is in accordance with the
requirements of the Code and the regulations promulgated thereunder and
that such transfer of a Residual Certificate will not be disregarded for
federal income tax purposes.
(vi) Any attempted or purported transfer of any Ownership Interest in
a Residual Certificate in violation of the provisions of this Section 6.02
shall be absolutely null and void and shall vest no rights in the purported
transferee. If any purported transferee shall, in violation of the
provisions of this Section 6.02, become a Holder of a Residual Certificate,
then the prior Holder of such Residual Certificate that is a Permitted
Transferee shall, upon discovery that the registration of transfer of such
Residual Certificate was not in fact permitted by this Section 6.02, be
restored to all rights as Holder thereof retroactive to the date of
registration of transfer of such Residual Certificate. The Trustee shall be
under no liability to any Person for any registration of transfer of a
Residual Certificate that is in fact not permitted by this Section 6.02 or
for making any distributions due on such Residual Certificate to the Holder
thereof or taking any other action with respect to such Holder under the
provisions of the Agreement so long as the transfer was registered in
accordance with this Section 6.02. The Trustee shall be entitled to recover
from any Holder of a Residual Certificate that was in fact not a Permitted
Transferee at the time such distributions were made all distributions made
on such Residual Certificate. Any such distributions so recovered by the
Trustee shall be distributed and delivered by the Trustee to the prior
Holder of such Residual Certificate that is a Permitted Transferee.
(vii) If any Person other than a Permitted Transferee acquires any
Ownership Interest in a Residual Certificate in violation of the
restrictions in this Section 6.02, then the Trustee, based on information
provided to the Trustee by the Servicer, will provide to the Internal
Revenue Service, and to the Persons specified in Section 860E(e)(3) and (6)
of the Code, information needed to compute the tax imposed under Section
860E(e) of the Code on transfers of residual interests to disqualified
organizations. The expenses of the Trustee under this clause (vii) shall be
reimbursable by the Trust.
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(viii) No Ownership Interest in a Residual Certificate shall be
acquired by a Plan or any Person acting on behalf of a Plan.
(g) [Reserved]
(h) No service charge shall be imposed for any transfer or exchange of
Certificates of any Class, but the Trustee may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
(i) All Certificates surrendered for transfer and exchange shall be
destroyed by the Certificate Registrar.
Section 6.03 Mutilated, Destroyed, Lost or Stolen Certificates. If (a)
any mutilated Certificate is surrendered to the Certificate Registrar or the
Certificate Registrar receives evidence to its satisfaction of the destruction,
loss or theft of any Certificate, and (b) there is delivered to the Trustee, the
Depositor and the Certificate Registrar such security or indemnity reasonably
satisfactory to each, to save each of them harmless, then, in the absence of
actual notice to the Trustee or the Certificate Registrar that such Certificate
has been acquired by a bona fide purchaser, the Trustee shall countersign and
deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Certificate, a new Certificate of like tenor, Class and Percentage
Interest but bearing a number not contemporaneously outstanding. Upon the
issuance of any new Certificate under this Section, the Trustee may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto and any other expenses (including the fees
and expenses of the Trustee and the Certificate Registrar) connected therewith.
Any duplicate Certificate issued pursuant to this Section shall constitute
complete and indefeasible evidence of ownership in the Trust, as if originally
issued, whether or not the lost, stolen or destroyed Certificate shall be found
at any time.
Section 6.04 Persons Deemed Owners. Prior to due presentation of a
Certificate for registration of transfer, the Depositor, the Servicer, the
Trustee, the Certificate Registrar and any agent of the Depositor, the Servicer,
the Trustee or the Certificate Registrar may treat the Person in whose name any
Certificate is registered as the owner of such Certificate for the purpose of
receiving distributions pursuant to Section 5.01 and for all other purposes
whatsoever, and none of the Depositor, the Servicer, the Trustee, the
Certificate Registrar or any agent of the Servicer, the Trustee or the
Certificate Registrar shall be affected by notice to the contrary.
ARTICLE VII
THE DEPOSITOR AND THE SERVICER
Section 7.01 Respective Liabilities of the Depositor and the Servicer. The
Depositor and the Servicer shall each be liable in accordance herewith only to
the extent of the obligations specifically and respectively imposed upon and
undertaken by the Depositor and the Servicer herein. By way of illustration and
not limitation, the Depositor is not liable for the servicing and administration
of the Mortgage Loans, nor is it obligated by Section 8.01 to assume any
obligations of the Servicer or to appoint a designee to assume such obligations,
nor
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is it liable for any other obligation hereunder that it may, but is not
obligated to, assume unless it elects to assume such obligation in accordance
herewith.
Section 7.02 Merger or Consolidation of the Depositor or the Servicer.
The Depositor and the Servicer will each keep in full effect its existence,
rights and franchises as a separate entity under the laws governing its
organization, and will each obtain and preserve its qualification to do business
as a foreign corporation in each jurisdiction in which such qualification is or
shall be necessary to protect the validity and enforceability of this Agreement,
the Certificates or any of the Mortgage Loans and to perform its respective
duties under this Agreement.
Any Person into which the Depositor or the Servicer may be merged or
consolidated, or any corporation or other organization resulting from any merger
or consolidation to which the Depositor or the Servicer shall be a party, or any
Person succeeding to the business of the Depositor or the Servicer, shall be the
successor of the Depositor or the Servicer, as the case may be, hereunder,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto, anything herein to the contrary notwithstanding;
provided, however, that the successor or surviving Person to the Servicer shall
be qualified to service mortgage loans on behalf of FNMA or FHLMC.
Section 7.03 Limitation on Liability of the Depositor, the Servicer and Others.
None of the Depositor, the Servicer or any of the directors, officers, employees
or agents of the Depositor or of the Servicer shall be under any liability to
the Trust Estate or the Certificateholders for any action taken or for
refraining from the taking of any action in good faith pursuant to this
Agreement, or for errors in judgment; provided, however, that this provision
shall not protect the Depositor, the Servicer or any such Person against any
breach of warranties or representations made herein or any liability which would
otherwise be imposed by reason of willful misfeasance, bad faith or gross
negligence in the performance of duties or by reason of reckless disregard of
obligations and duties hereunder. The Depositor, the Servicer and any director,
officer, employee or agent of the Depositor or the Servicer may rely in good
faith on any document of any kind prima facie properly executed and submitted by
any Person respecting any matters arising hereunder. The Depositor, the Servicer
and any director, officer, employee or agent of the Depositor or the Servicer
shall be indemnified by the Trust Estate and held harmless against any loss,
liability or expense incurred in connection with any legal action relating to
this Agreement or the Certificates, other than any loss, liability or expense
related to any specific Mortgage Loan or Mortgage Loans (except as any such
loss, liability or expense shall be otherwise reimbursable pursuant to this
Agreement) and any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or gross negligence in the performance of duties
hereunder or by reason of reckless disregard of obligations and duties
hereunder. Neither of the Depositor nor the Servicer shall be under any
obligation to appear in, prosecute or defend any legal action which is not
incidental to its respective duties under this Agreement and which in its
opinion may involve it in any expense or liability; provided, however, that the
Depositor or the Servicer may in its discretion undertake any such action which
it may deem necessary or desirable in respect to this Agreement and the rights
and duties of the parties hereto and the interests of the Certificateholders
hereunder. In such event, the legal expenses and costs of such action and any
liability resulting therefrom shall be expenses, costs and liabilities of the
Trust Estate, and the Depositor and the Servicer shall be entitled to be
reimbursed therefor out of
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amounts attributable to the Mortgage Loans on deposit in the Servicer Custodial
Account as provided by Section 3.11.
Section 7.04 Depositor and Servicer Not to Resign. Subject to the
provisions of Section 7.02, neither the Depositor nor the Servicer shall resign
from its respective obligations and duties hereby imposed on it except upon
determination that its duties hereunder are no longer permissible under
applicable law. Any such determination permitting the resignation of the
Depositor or the Servicer shall be evidenced by an Opinion of Counsel to such
effect delivered to the Trustee. No such resignation by the Servicer shall
become effective until the Trustee or a successor Servicer shall have assumed
the Servicer's responsibilities and obligations in accordance with Section 8.05
hereof.
ARTICLE VIII
DEFAULT
Section 8.01 Events of Default. If any one of the following events ("Events of
Default") shall occur and be continuing:
(a) any failure by the Servicer to deposit amounts in the Servicer
Custodial Account in the amount and manner provided herein so as to enable the
Trustee to distribute to Holders of Certificates any payment required to be made
under the terms of such Certificates and this Agreement (other than the payments
required to be made under Section 3.20) which continues unremedied for a period
of five days; or
(b) failure on the part of the Servicer duly to observe or perform in
any material respect any other covenants or agreements of the Servicer set forth
in the Certificates or in this Agreement, which covenants and agreements
continue unremedied for a period of 30 days after the date on which written
notice of such failure, requiring the same to be remedied, shall have been given
to the Servicer by the Trustee or the Depositor, or to the Servicer, the
Depositor and the Trustee by the Holders of Certificates evidencing Voting
Rights aggregating not less than 25% of all Certificates affected thereby; or
(c) the entry of a decree or order by a court or agency or supervisory
authority having jurisdiction in the premises for the appointment of a
conservator, receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings against the
Servicer, or for the winding up or liquidation of the Servicer's affairs, and
the continuance of any such decree or order unstayed and in effect for a period
of 60 consecutive days; or
(d) the consent by the Servicer to the appointment of a conservator or
receiver or liquidator in any insolvency, readjustment of debt, marshalling of
assets and liabilities or similar proceedings of or relating to the Servicer or
of or relating to substantially all of its property; or the Servicer shall admit
in writing its inability to pay its debts generally as they become due, file a
petition to take advantage of any applicable insolvency or reorganization
statute, make an assignment for the benefit of its creditors, or voluntarily
suspend payment of its obligations; or
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(e) the failure of the Servicer to remit any Periodic Advance required
to be remitted by the Servicer pursuant to Section 3.20 which failure continues
unremedied at 3:00 p.m. on the related Distribution Date;
then, and in each and every such case, so long as an Event of Default shall not
have been remedied by the Servicer, either the Trustee or the Depositor may, and
at the direction of the Holders of Certificates evidencing Voting Rights
aggregating not less than 51% of all Certificates affected thereby shall, by
notice then given in writing to the Servicer (and to the Trustee, if given by
the Depositor, and to the Depositor, if given by the Trustee), terminate all of
the rights and obligations of the Servicer under this Agreement. If an Event of
Default described in clause (e) hereof shall occur, the Trustee shall, by notice
to the Servicer, terminate all of the rights and obligations of the Servicer
under this Agreement and in and to the Mortgage Loans and proceeds thereof and
the Trustee or a successor Servicer appointed pursuant to Section 8.05 shall
make the Advance which the Servicer failed to make. On or after the receipt by
the Servicer of such written notice, all authority and power of the Servicer
under this Agreement, whether with respect to the Certificates or the Mortgage
Loans or otherwise, shall pass to and be vested in the Trustee pursuant to and
under this Section 8.01, unless and until such time as the Trustee shall appoint
a successor Servicer pursuant to Section 8.05, and, without limitation, the
Trustee is hereby authorized and empowered to execute and deliver, on behalf of
the Servicer, as attorney-in-fact or otherwise, any and all documents and other
instruments, and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement of the Mortgage Loans and related
documents, or otherwise, including, without limitation, the recordation of the
assignments of the Mortgage Loans to it. The Servicer agrees to cooperate with
the Trustee in effecting the termination of the responsibilities and rights of
the Servicer hereunder, including, without limitation, the transfer to the
Trustee for the administration by it of all cash amounts that have been
deposited by the Servicer in the Servicer Custodial Account or thereafter
received by the Servicer with respect to the Mortgage Loans. Upon obtaining
notice or knowledge of the occurrence of any Event of Default, the Person
obtaining such notice or knowledge shall give prompt written notice thereof to
Certificateholders at their respective addresses appearing in the Certificate
Register and to each Rating Agency. All costs and expenses (including attorneys'
fees) incurred in connection with transferring the Mortgage Files to the
successor Servicer and amending this Agreement to reflect such succession as
Servicer pursuant to this Section 8.01 shall be paid by the predecessor
Servicer. Notwithstanding the termination of the Servicer pursuant hereto, the
Servicer shall remain liable for any causes of action arising out of any Event
of Default occurring prior to such termination.
Section 8.02 Remedies of Trustee. During the continuance of any Event
of Default, so long as such Event of Default shall not have been remedied, the
Trustee, in addition to the rights specified in Section 8.01, shall have the
right, in its own name as trustee of an express trust, to take all actions now
or hereafter existing at law, in equity or by statute to enforce its rights and
remedies and to protect the interests, and enforce the rights and remedies, of
the Certificateholders (including the institution and prosecution of all
judicial, administrative and other proceedings and the filing of proofs of claim
and debt in connection therewith). Except as otherwise expressly provided in
this Agreement, no remedy provided for by this Agreement shall be exclusive of
any other remedy, and each and every remedy shall be cumulative and in
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addition to any other remedy and no delay or omission to exercise any right or
remedy shall impair any such right or remedy or shall be deemed to be a waiver
of any Event of Default.
Section 8.03 Directions by Certificateholders and Duties of Trustee
During Event of Default. During the continuance of any Event of Default, Holders
of Certificates evidencing Voting Rights aggregating not less than 25% of each
Class of Certificates affected thereby may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred upon the Trustee under this Agreement; provided,
however, that the Trustee shall be under no obligation to pursue any such
remedy, or to exercise any of the trusts or powers vested in it by this
Agreement (including, without limitation, (a) the conducting or defending of any
administrative action or litigation hereunder or in relation hereto, and (b) the
terminating of the Servicer or any successor Servicer from its rights and duties
as servicer hereunder) at the request, order or direction of any of the
Certificateholders, unless such Certificateholders shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby and, provided further,
that, subject to the provisions of Section 9.01, the Trustee shall have the
right to decline to follow any such direction if the Trustee, based upon an
Opinion of Counsel, determines that the action or proceeding so directed may not
lawfully be taken or if the Trustee in good faith determines that the action or
proceeding so directed would involve it in personal liability or be unjustly
prejudicial to the non-assenting Certificateholders.
Section 8.04 Action upon Certain Failures of the Servicer and upon
Event of Default. In the event that the Trustee shall have actual knowledge of
any failure of the Servicer specified in Section 8.01(a) or (b) which would
become an Event of Default upon the Servicer's failure to remedy the same after
notice, the Trustee shall give notice thereof to the Servicer. If the Trustee
shall have knowledge of an Event of Default, the Trustee shall give prompt
written notice thereof to the Certificateholders.
Section 8.05 Trustee to Act; Appointment of Successor.
(a) On and after the time the Servicer receives a notice of
termination pursuant to Section 8.01, the Trustee shall be the successor in all
respects to the Servicer in its capacity as servicer under this Agreement and
the transactions set forth or provided for herein and shall be subject to all
the responsibilities, duties and liabilities relating thereto placed on the
Servicer by the terms and provisions hereof or shall appoint a successor
pursuant to Section 3.07. Notwithstanding anything provided herein to the
contrary, under no circumstances shall any provision of this Agreement be
construed to require the Trustee, acting in its capacity as successor to the
Servicer in its obligation to make Advances, to advance, expend or risk its own
funds or otherwise incur any financial liability in the performance of its
duties hereunder if it shall have reasonable grounds for believing that such
funds are non-recoverable. Subject to Section 8.05(b), as compensation therefor,
the Trustee shall be entitled to such compensation as the terminated Servicer
would have been entitled to hereunder if no such notice of termination had been
given. Notwithstanding the above, the Trustee may, if it shall be unwilling so
to act, or shall, if it is legally unable so to act, appoint, or petition a
court of competent jurisdiction to appoint, any established housing and home
finance institution having a net worth of not less than $10,000,000 as the
successor to the terminated Servicer hereunder in the assumption of all or any
part of the responsibilities, duties or liabilities of the Servicer hereunder;
provided, however, that
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any such institution appointed as successor Servicer shall not, as evidenced in
writing by each Rating Agency, adversely affect the then current rating of any
Class of Certificates immediately prior to the termination of the terminated
Servicer. The appointment of a successor Servicer shall not affect any liability
of the predecessor Servicer which may have arisen under this Agreement prior to
its termination as Servicer, nor shall any successor Servicer be liable for any
acts or omissions of the predecessor Servicer or for any breach by the Servicer
of any of its representations or warranties contained herein or in any related
document or agreement. Pending appointment of a successor to the terminated
Servicer hereunder, unless the Trustee is prohibited by law from so acting, the
Trustee shall act in such capacity as provided above. The Trustee and such
successor shall take such action, consistent with this Agreement, as shall be
necessary to effectuate any such succession.
(b) In connection with the appointment of a successor Servicer or the
assumption of the duties of the Servicer, as specified in Section 8.05(a), the
Trustee may make such arrangements for the compensation of such successor out of
payments on Mortgage Loans serviced by the predecessor Servicer as it and such
successor shall agree; provided, however, that any Person assuming the duties of
the Servicer shall pay to such predecessor an amount equal to the market value
of the portion of the Servicing Fee that will accrue in the future due to the
Servicing Fee Rate exceeding % per annum with respect to any Mortgage Loan. The
"market value" of such portion of the Servicing Fee shall be determined by
______________, on the basis of at least two quotations from third parties
actively engaged in the servicing of single-family mortgage loans. If the
successor Servicer does not agree that such market value is a fair price, such
successor shall obtain two quotations of market value from third parties
actively engaged in the servicing of single-family mortgage loans. The market
value of the excess portion of the Servicing Fee will then be equal to the
average of (i) the lowest figure obtained by ____________, and (ii) the highest
figure obtained by the successor Servicer. Payment of the amount calculated
above shall be made to , by the successor Servicer no later than the last
Business Day of the month in which such successor Servicer becomes entitled to
receive the Servicing Fee under this Agreement. In no event will any portion of
the Trust Estate be used to pay amounts due to ____________ under this Section
8.05(b).
(c) Any successor, including the Trustee, to the Servicer as servicer
shall during the term of its service as servicer maintain in force (i) a policy
or policies of insurance covering errors and omissions in the performance of its
obligations as servicer hereunder and (ii) a fidelity bond in respect of its
officers, employees and agents to the same extent as the Servicer is so required
pursuant to Section 3.03.
Section 8.06 Notification to Certificateholders. Upon any termination
or appointment of a successor to the Servicer pursuant to this Article VIII, the
Trustee shall give prompt written notice thereof to Certificateholders at their
respective addresses appearing in the Certificate Register and to each Rating
Agency.
ARTICLE IX
THE TRUSTEE
Section 9.01 Duties of Trustee.
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(a) The Trustee, prior to the occurrence of an Event of Default and
after the curing or waiver of all Events of Default which may have occurred,
undertakes to perform such duties and only such duties as are specifically set
forth in this Agreement. In case an Event of Default has occurred of which a
Responsible Officer of the Trustee shall have actual knowledge (which has not
been cured or waived), the Trustee shall exercise such of the rights and powers
vested in it by this Agreement, and use the same degree of care and skill in
their exercise as a reasonably prudent investor would exercise or use under the
circumstances in the conduct of such investor's own affairs.
The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
conform to the requirements of this Agreement.
(b) No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own grossly negligent action, its own grossly
negligent failure to act or its own willful misfeasance; provided, however,
that:
(i) Prior to the occurrence of an Event of Default, and after the
curing or waiver of all such Events of Default which may have occurred, the
duties and obligations of the Trustee shall be determined solely by the
express provisions of this Agreement, the Trustee shall not be liable
except for the performance of such duties and obligations as are
specifically set forth in this Agreement, no implied covenants or
obligations shall be read into this Agreement against the Trustee and, in
the absence of bad faith on the part of the Trustee, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon any certificates or opinions furnished
to the Trustee by the Depositor or the Servicer and which on their face, do
not contradict the requirements of this Agreement;
(ii) The Trustee (in its individual capacity) shall not be personally
liable for an error of judgment made in good faith by a Responsible Officer
or Responsible Officers of the Trustee, unless it shall be proved that the
Trustee was grossly negligent in ascertaining the pertinent facts;
(iii) The Trustee (in its individual capacity) shall not be personally
liable with respect to any action taken, suffered or omitted to be taken by
it in good faith in accordance with the direction of Certificateholders as
provided in Section 8.03;
(iv) The Trustee shall not be charged with knowledge of any default
(other than a default in payment to the Trustee) specified in clauses (a)
and (b) of Section 8.01 or an Event of Default under clauses (c), (d) and
(e) of Section 8.01 unless a Responsible Officer of the Trustee assigned to
and working in the Corporate Trust Office obtains actual knowledge of such
failure or event or any officer of the Trustee receives written notice of
such failure or event at its Corporate Trust Office from the Servicer, the
Depositor or any Certificateholder; and
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(v) Except to the extent provided in Section 8.05, no provision in
this Agreement shall require the Trustee to expend or risk its own funds
(including, without limitation, the making of any Advance as successor
Servicer) or otherwise incur any personal financial liability in the
performance of any of its duties as Trustee hereunder, or in the exercise
of any of its rights or powers, if the Trustee shall have reasonable
grounds for believing that repayment of funds or adequate indemnity against
such risk or liability is not reasonably assured to it.
Section 9.02 Certain Matters Affecting the Trustee.
Except as otherwise provided in Section 9.01:
(i) The Trustee may request and rely upon and shall be protected in
acting or refraining from acting upon any resolution, Officer's
Certificate, certificate of auditors or any other certificate, statement,
instrument, opinion, report, notice, request, consent, order, appraisal,
bond or other paper or document believed by it to be genuine and to have
been signed or presented by the proper party or parties;
(ii) The Trustee may consult with counsel and any Opinion of Counsel
shall be full and complete authorization and protection in respect of any
action taken or suffered or omitted by it hereunder in good faith and in
accordance with such Opinion of Counsel;
(iii) The Trustee shall be under no obligation to exercise any of the
trusts or powers vested in it by this Agreement or to institute, conduct or
defend any litigation hereunder or in relation hereto at the request, order
or direction of any of the Certificateholders, pursuant to the provisions
of this Agreement, unless such Certificateholders shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby; nothing contained
herein shall, however, relieve the Trustee of the obligation, upon the
occurrence of an Event of Default (which has not been cured or waived), to
exercise such of the rights and powers vested in it by this Agreement, and
to use the same degree of care and skill in their exercise as a prudent
investor would exercise or use under the circumstances in the conduct of
such investor's own affairs;
(iv) The Trustee shall not be personally liable for any action taken,
suffered or omitted by it in good faith and believed by it to be authorized
or within the discretion or rights or powers conferred upon it by this
Agreement;
(v) Prior to the occurrence of an Event of Default hereunder and after
the curing or waiving of all Events of Default which may have occurred, the
Trustee shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond or other
paper or document, unless requested in writing so to do by Holders or
Certificate or any Class evidencing, as to such Class, Percentage
Interests, aggregating not less than 50%; provided, however, that if the
payment within a reasonable time to the Trustee of the costs, expenses or
liabilities likely to be incurred by it in the making of such investigation
is, in the opinion of the Trustee, not reasonably
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assured to the Trustee by the security afforded to it by the terms of this
Agreement, the Trustee may require reasonable indemnity against such
expense or liability or payment of such estimated expenses as a condition
to so proceeding; and
(vi) The Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys.
Section 9.03 Trustee Not Liable for Certificates or Mortgage Loans. The
recitals contained herein and in the Certificates (other than the execution of,
and the counter-signature on the Certificates) shall be taken as the statements
of the Depositor or Servicer, as applicable, and the Trustee assumes no
responsibility for their correctness. The Trustee makes no representations as to
the validity or sufficiency of this Agreement or of the Certificates or any
Mortgage Loans save that the Trustee represents that, assuming due execution and
delivery by the other parties hereto, this Agreement has been duly authorized,
executed and delivered by it and constitutes its legal, valid and binding
obligation, enforceable against it in accordance with its terms, subject, as to
enforcement of remedies, to applicable insolvency, receivership, moratorium and
other laws affecting the rights of creditors generally, and to general
principles of equity and the discretion of the court (regardless of whether
enforcement of such remedies is considered in a proceeding in equity or at law).
The Trustee shall not be accountable for the use or application by the Depositor
of funds paid to the Depositor in consideration of the assignment of the
Mortgage Loans hereunder by the Depositor, or for the use or application of any
funds paid to Subservicers or the Servicer in respect of the Mortgage Loans or
deposited into the Servicer Custodial Account, or any other account hereunder
(other than the Certificate Account) by the Servicer.
The Trustee shall at no time have any responsibility or liability for or
with respect to the legality, validity and enforceability of any Mortgage or any
Mortgage Loan, or the perfection and priority of any Mortgage or the maintenance
of any such perfection and priority or for or with respect to the sufficiency of
the Trust or its ability to generate the payments to be distributed to
Certificateholders under this Agreement, including, without limitation: the
existence, condition and ownership of any Mortgaged Property; the existence and
enforceability of any hazard insurance thereon (other than if the Trustee shall
assume the duties of the Servicer pursuant to Section 8.05 and thereupon only
for the acts or omissions of the successor Servicer); the validity of the
assignment of any Mortgage Loan to the Trustee or of any intervening assignment;
the completeness of any Mortgage Loan; the performance or enforcement of any
Mortgage Loan (other than if the Trustee shall assume the duties of the Servicer
pursuant to Section 8.05 and thereupon only for the acts or omissions of the
Trustee as successor Servicer); the compliance by the Depositor or the Servicer
with any warranty or representation made under this Agreement or in any related
document or the accuracy of any such warranty or representation; any investment
of monies by or at the direction of the Servicer or any loss resulting
therefrom, it being understood that the Trustee shall remain responsible for any
Trust property that it may hold in its individual capacity; the acts or
omissions of any of the Depositor, the Servicer (other than if the Trustee shall
assume the duties of the Servicer pursuant to Section 8.05 and thereupon only
for the acts or omissions of the Trustee as successor Servicer), any Subservicer
or any Mortgagor; any action of the Servicer (other than if the Trustee shall
assume the duties of the Servicer pursuant to Section 8.05 and thereupon only
for the acts or omissions of the Trustee as successor Servicer) or any
Subservicer taken in the name of the Trustee; the
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failure of the Servicer or any Subservicer to act or perform any duties required
of it as agent of the Trustee hereunder; or any action by the Trustee taken at
the instruction of the Servicer (other than if the Trustee shall assume the
duties of the Servicer pursuant to Section 8.05 and thereupon only for the acts
or omissions of the Trustee as successor Servicer); provided, however, that the
foregoing shall not relieve the Trustee of its obligation to perform its duties
under this Agreement, including, without limitation, the Trustee's review of the
Mortgage Files pursuant to Section 2.02. The Trustee shall file any financing or
continuation statement in any public office at any time required to maintain the
perfection of any security interest or lien granted to it hereunder.
Section 9.04 Trustee May Own Certificates. The Trustee in its
individual or any other capacity may become the owner or pledgee of Certificates
with the same rights it would have if it were not Trustee and may otherwise deal
with the Servicer, any Subservicer or any of their respective affiliates with
the same right it would have if it were not the Trustee.
Section 9.05 Eligibility Requirements for Trustee. The Trustee
hereunder shall at all times be (a) an institution the deposits of which are
fully insured by the FDIC and (b) a corporation or banking association organized
and doing business under the laws of the United States of America or of any
State, authorized under such laws to exercise corporate trust powers, having a
combined capital and surplus of not less than $50,000,000 and subject to
supervision or examination by Federal or State authority and (c) with respect to
every successor trustee hereunder either an institution (i) the long-term
unsecured debt obligations of which are rated at least " " by and or (ii) whose
serving as Trustee hereunder would not result in the lowering of the ratings
originally assigned to any Class of Certificates. The Trustee shall not be an
affiliate of the Depositor or the Servicer. If such corporation or banking
association publishes reports of condition at least annually, pursuant to law or
to the requirements of the aforesaid supervising or examining authority, then
for the purposes of this Section 9.05, the combined capital and surplus of such
corporation or banking association shall be deemed to be its combined capital
and surplus as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with the
provision of this Section 9.05, the Trustee shall resign immediately in the
manner and with the effect specified in Section 9.06.
Section 9.06 Resignation and Removal of Trustee. The Trustee may at
any time resign and be discharged from the trust hereby created by giving
written notice thereof to the Servicer and mailing a copy of such notice to all
Holders of record. The Trustee shall also mail a copy of such notice of
resignation to each Rating Agency. Upon receiving such notice of resignation,
the Servicer shall use their best efforts to promptly appoint a mutually
acceptable successor Trustee by written instrument, in duplicate, one copy of
which instrument shall be delivered to the resigning Trustee and one copy to the
successor Trustee. If no successor Trustee shall have been so appointed and
shall have accepted appointment within 30 days after the giving of such notice
of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 9.05 and shall fail to resign after written
request therefor by the Servicer, or if at any time the Trustee shall become
incapable of acting, or shall be adjudged a bankrupt or
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insolvent, or a receiver of the Trustee or of its property shall be appointed,
or any public officer shall take charge or control of the Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, then the Servicer may remove the Trustee and appoint a successor
trustee by written instrument, in duplicate, one copy of which instrument shall
be delivered to the Trustee so removed and one copy to the successor.
The Holders of Certificates evidencing not less than 50% of the Voting
Rights may at any time remove the Trustee by written instrument or instruments
delivered to the Servicer and the Trustee; the Servicer shall thereupon use
their best efforts to appoint a mutually acceptable successor Trustee in
accordance with this Section 9.06.
Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section 9.06 shall
become effective upon acceptance of appointment by the successor Trustee as
provided in Section 9.07.
Section 9.07 Successor Trustee. Any successor Trustee appointed as
provided in Section 9.06 shall execute, acknowledge and deliver to the Servicer
and to its predecessor Trustee an instrument accepting such appointment
hereunder, and thereupon the resignation or removal of the predecessor Trustee
shall become effective and such successor Trustee, without any further act, deed
or conveyance, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor hereunder, with like effect as if originally
named as Trustee herein. The predecessor Trustee shall duly assign, transfer,
deliver and pay over to the successor Trustee the whole of the Mortgage Files
and related documents and statements held by it hereunder, together with all
instruments of transfer and assignment or other documents properly executed as
may be reasonably required to effect such transfer and such of the records or
copies thereof maintained by the predecessor Trustee in the administration
hereof as may be reasonably requested by the successor Trustee and shall
thereupon be discharged from all duties and responsibilities under this
Agreement; provided, however, that if the predecessor Trustee has been
terminated pursuant to the third paragraph of Section 9.06, all reasonable
expenses of the predecessor Trustee incurred in complying with this Section 9.07
shall be reimbursed by the Trust.
No successor Trustee shall accept appointment as provided in this
Section 9.07 unless at the time of such appointment such successor Trustee shall
be eligible under the provisions of Section 9.05.
Upon acceptance of appointment by a successor Trustee as provided in
this Section 9.07, the Servicer shall cooperate to mail notice of the succession
of such Trustee hereunder to all Holders of Certificates at their addresses as
shown in the Certificate Register and to each Rating Agency. If the Servicer
fail to mail such notice within ten days after acceptance of appointment by the
successor Trustee, the successor Trustee shall cause such notice to be mailed at
the expense of the Servicer.
Section 9.08 Merger or Consolidation of Trustee. Any corporation or
banking association into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation or banking association
resulting from any merger, conversion or consolidation to which the Trustee
shall be a party, or any corporation or banking association
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succeeding to all or substantially all of the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder, if such corporation or
banking association is eligible under the provisions of Section 9.05, without
the execution or filing of any paper or any further act on the part of any of
the parties hereto, anything herein to the contrary notwithstanding.
Section 9.09 Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any of the provisions hereof, at any time, for the purpose of
meeting any legal requirements of any jurisdiction in which any Mortgaged
Property may at the time be located or for any other reason, the Servicer and
the Trustee acting jointly shall have the power and shall execute and deliver
all instruments to appoint one or more Persons approved by the Trustee as
co-trustee or separate trustee of all or any part of the Trust Estate, and to
vest in such Person or Persons, in such capacity, such title to the Trust
Estate, or any part thereof, and, subject to the other provision of this Section
9.09, such powers, duties, obligations, rights and trusts as the Servicer and
the Trustee may consider necessary or desirable. If the Servicer shall not have
joined in such appointment within ten days after the receipt by it of a request
to do so, the Trustee alone shall have the power to make such appointment. No
co-trustee or separate trustee hereunder shall be required to meet the terms of
eligibility as a successor Trustee under Section 9.05 and no notice to Holders
of Certificates of the appointment of co-trustee(s) or separate trustee(s) shall
be required under Section 9.07.
In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 9.09, all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly, except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed (whether as Trustee hereunder or
as successor to the Servicer hereunder), the Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such rights, powers,
duties and obligations (including the holding of title to the Trust Estate or
any portion thereof in any such jurisdiction) shall be exercised and performed
by such separate trustee or co-trustee at the direction of the Trustee. No
trustee hereunder shall be held personally liable by reason of any act or
omission of any other trustee hereunder; provided, however, that no appointment
of a co-trustee or separate trustee hereunder shall relieve the Trustee of its
obligations hereunder.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article IX. Each separate trustee and co-trustee, upon its acceptance of
the trusts conferred, shall be vested with the estates or property specified in
its instrument of appointment, either jointly with the Trustee or separately, as
may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall become incapable of acting, resign or be removed, or shall be
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adjudged a bankrupt or insolvent, or a receiver of its property shall be
appointed, or any public officer shall take charge or control of such trustee or
co-trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, all of its estates, properties, rights, remedies
and trusts shall vest in and be exercised by the Trustee, to the extent
permitted by law, without the appointment of a new or successor trustee.
Section 9.10 Authenticating Agents. The Trustee may appoint one or
more authenticating agents ("Authenticating Agents") which shall be authorized
to act on behalf of the Trustee in authenticating or countersigning
Certificates. Initially, the Authenticating Agent shall be . Wherever reference
is made in this Agreement to the authentication or countersigning of
Certificates by the Trustee or the Trustee's certificate of authentication or
countersigning, such reference shall be deemed to include authentication or
countersigning on behalf of the Trustee by an Authenticating Agent and a
certificate of authentication or countersignature executed on behalf of the
Trustee by an Authenticating Agent. Each Authenticating Agent must be acceptable
to the Servicer and must be a corporation or banking association organized and
doing business under the laws of the United States of America or of any State,
having a principal office and place of business in New York, New York, having a
combined capital and surplus of at least $15,000,000, authorized under such laws
to do a trust business and subject to supervision or examination by Federal or
State authorities.
Any corporation or banking association into which any Authenticating
Agent may be merged or converted or with which it may be consolidated, or any
corporation or banking association resulting from any merger, conversion or
consolidation to which any Authenticating Agent shall be a party, or any
corporation or banking association succeeding to the corporate agency business
of any Authenticating Agent, shall continue to be the Authenticating Agent
without the execution or filing of any paper or any further act on the part of
the Trustee or the Authenticating Agent.
Any Authenticating Agent may at any time resign by giving written
notice of resignation to the Trustee and to the Servicer. The Trustee may at any
time terminate the agency of any Authenticating Agent by giving written notice
of termination to such Authenticating Agent and to the Servicer. Upon receiving
a notice of resignation or upon such a termination, or in case, at any time any
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section 9.10, the Trustee may appoint a successor
Authenticating Agent, shall give written notice of such appointment to the
Servicer and shall mail notice of such appointment to all Certificateholders.
Any successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers, duties and responsibilities of
its predecessor hereunder, with like effect as if originally named as
Authenticating Agent.
Section 9.11 Trustee's Fees and Expenses. The Trustee, as compensation
for its activities hereunder, shall be entitled to receive on each Distribution
Date an amount equal to the Trustee Fee for such Distribution Date pursuant to
Section 5.02(a). The Trustee and any director, officer, employee or agent of the
Trustee shall be indemnified by the Trust and held harmless against any loss,
liability or expense (including reasonable attorney's fees) (a) incurred in
connection with any claim or legal action relating to (i) this Agreement, (ii)
the Certificates, or (iii) the performance of any of the Trustee's duties
hereunder, other than any loss, liability or
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expense incurred by reason of willful misfeasance, bad faith or gross negligence
in the performance of any of the Trustee's duties hereunder, (b) resulting from
any tax or information return which was prepared by, or should have been
prepared by, the Servicer and (c) arising out of the transfer of any Private
Certificate not in compliance with ERISA. Such indemnity shall survive the
termination of this Agreement or the resignation or removal of the Trustee
hereunder. Without limiting the foregoing, except as otherwise agreed upon in
writing by the Depositor and the Trustee, and except for any such expense,
disbursement or advance as may arise from the Trustee's gross negligence, bad
faith or willful misconduct, the Trust shall reimburse the Trustee for all
reasonable expenses, disbursements and advances incurred or made by the Trustee
in accordance with any of the provisions of this Agreement to the extent
permitted by Treasury Regulations Section 1.860G-1(b)(3)(ii) and (iii);
provided, however, that the Depositor and the Trustee intend to enter into a
separate agreement for custody-related services. Except as otherwise provided
herein, the Trustee shall not be entitled to payment or reimbursement for any
routine ongoing expenses incurred by the Trustee in the ordinary course of its
duties as Trustee, Certificate Registrar or Paying Agent hereunder or for any
other expenses.
Section 9.12 Appointment of Custodian. The Trustee may at any time on
or after the Closing Date, with the consent of the Depositor and the Servicer,
appoint one or more Custodians to hold all or a portion of the Mortgage Files as
agent for the Trustee, by entering into a custodial agreement in a form
acceptable to the Depositor and the Servicer. Subject to this Article IX, the
Trustee agrees to comply with the terms of each Custodial Agreement and to
enforce the terms and provisions thereof against the Custodian for the benefit
of the Certificateholders. Each Custodian shall be a depository institution
subject to supervision by federal or state authority, shall have a combined
capital and surplus of at least $10,000,000 and shall be qualified to do
business in the jurisdiction in which it holds any Mortgage File.
Section 9.13 Paying Agents. The Trustee may appoint one or more Paying
Agents (each, a "Paying Agent") which shall be authorized to act on behalf of
the Trustee in making withdrawals from the Certificate Account and distributions
to Certificateholders as provided in Section 3.08 and Section 5.02. Wherever
reference is made in this Agreement to the withdrawal from the Certificate
Account by the Trustee, such reference shall be deemed to include such a
withdrawal on behalf of the Trustee by a Paying Agent. Initially, the Paying
Agent shall be . Whenever reference is made in this Agreement to a distribution
by the Trustee or the furnishing of a statement to Certificateholders by the
Trustee, such reference shall be deemed to include such a distribution or
furnishing on behalf of the Trustee by a Paying Agent. Each Paying Agent shall
provide to the Trustee such information concerning the Certificate Account as
the Trustee shall request from time to time. Each Paying Agent must be
reasonably acceptable to the Servicer and must be a corporation or banking
association organized and doing business under the laws of the United States of
America or of any state, having (except in the case of the Trustee) a principal
office and place of business in New York, New York, having a combined capital
and surplus of at least $15,000,000, authorized under such laws to do a trust
business and subject to supervision or examination by federal or state
authorities.
Any corporation into which any Paying Agent may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which any Paying Agent shall be a party,
or any corporation succeeding to the
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corporate agency business of any Paying Agent, shall continue to be the Paying
Agent provided that such corporation after the consummation of such merger,
conversion, consolidation or succession meets the eligibility requirements of
this Section 9.13.
Any Paying Agent may at any time resign by giving written notice of
resignation to the Trustee and to the Servicer; provided that the Paying Agent
has returned to the Certificate Account or otherwise accounted, to the
reasonable satisfaction of the Trustee, for all amounts it has withdrawn from
the Certificate Account. The Trustee may, upon prior written approval of the
Servicer, at any time terminate the agency of any Paying Agent by giving written
notice of termination to such Paying Agent and to the Servicer. Upon receiving a
notice of resignation or upon such a termination, or in case at any time any
Paying Agent shall cease to be eligible in accordance with the provisions of the
first paragraph of this Section 9.13, the Trustee may appoint, upon prior
written approval of the Servicer, a successor Paying Agent, shall give written
notice of such appointment to the Servicer and shall mail notice of such
appointment to all Certificateholders. Any successor Paying Agent upon
acceptance of its appointment hereunder shall become vested with all rights,
powers, duties and responsibilities of its predecessor hereunder, with like
effect as if originally named as Paying Agent. The Trustee shall remain liable
for any duties and obligations assumed by its appointed Paying Agent.
Section 9.14 Limitation of Liability. The Certificates are executed by
the Trustee, not in its individual capacity but solely as Trustee of the Trust,
in the exercise of the powers and authority conferred and vested in it by this
Agreement. Each of the undertakings and agreements made on the part of the
Trustee in the Certificates is made and intended not as a personal undertaking
or agreement by the Trustee but is made and intended for the purpose of binding
only the Trust.
Section 9.15 Trustee May Enforce Claims Without Possession of
Certificates. All rights of action and claims under this Agreement or the
Certificates may be prosecuted and enforced by the Trustee without the
possession of any of the Certificates or the production thereof in any
proceeding relating thereto, and such preceding instituted by the Trustee shall
be brought in its own name or in its capacity as Trustee. Any recovery of
judgment shall, after provision for the payment of the reasonable compensation,
expenses, disbursement and advances of the Trustee, its agents and counsel, be
for the ratable benefit of the Certificateholders in respect of which such
judgment has been recovered.
Section 9.16 Suits for Enforcement. In case an Event of Default or
other default by the Servicer or the Depositor hereunder shall occur and be
continuing, the Trustee, in its discretion, may proceed to protect and enforce
its rights and the rights of the Holders of Certificates under this Agreement by
a suit, action or proceeding in equity or at law or otherwise, whether for the
specific performance of any covenant or agreement contained in this Agreement or
in aid of the execution of any power granted in this Agreement or for the
enforcement of any other legal, equitable or other remedy, as the Trustee, being
advised by counsel, shall deem most effectual to protect and enforce any of the
rights of the Trustee and the Certificateholders.
Section 9.17 Waiver of Bond Requirement. The Trustee shall be relieved
of, and each Certificateholder hereby waives, any requirement of any
jurisdiction in which the Trust,
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or any part thereof, may be located that the Trustee post a bond or other surety
with any court, agency or body whatsoever.
Section 9.18 Waiver of Inventory, Accounting and Appraisal
Requirement. The Trustee shall be relieved of, and each Certificateholder hereby
waives, any requirement of any jurisdiction in which the Trust, or any part
thereof, may be located that the Trustee file any inventory, accounting or
appraisal of the Trust with any court, agency or body at any time or in any
manner whatsoever.
ARTICLE X
TERMINATION
Section 10.01 Termination upon Purchase by the Depositor or
Liquidation of All Mortgage Loans. Subject to Section 10.02, the respective
obligations and responsibilities of the Depositor, the Servicer and the Trustee
created hereby (other than the obligation of Trustee to make certain payments to
Certificateholders after the Final Distribution Date and to send certain notices
as hereinafter set forth and the obligations of the Trustee pursuant to Sections
5.04(b) and 5.05(b)) shall terminate upon the last action required to be taken
by the Trustee on the Final Distribution Date pursuant to this Article X
following the earlier of (a) the purchase by the Depositor of all Mortgage Loans
and all REO Property remaining in the Trust Estate at a price equal to the sum
of (i) 100% of the Stated Principal Balance of each Mortgage Loan (other than
any Mortgage Loan as to which REO Property has been acquired and whose fair
market value is included pursuant to clause (ii) below) and (ii) the fair market
value of such REO Property (as determined by the Depositor as of the close of
business on the third Business Day next preceding the date upon which notice of
any such termination is furnished to Certificateholders pursuant to the fourth
paragraph of this Article X), plus any Class Unpaid Interest Shortfall for any
Class of Certificates as well as one month's interest at the related Mortgage
Rate on the Stated Principal Balance of each Mortgage Loan (including any
Mortgage Loan as to which REO Property has been acquired) or (b) the final
payment or other liquidation (or any advance with respect thereto) of the last
Mortgage Loan remaining in the Trust Estate or the disposition of all REO
Property.
Regardless of the foregoing, in no event shall the Trust created
hereby continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of Joseph P. Kennedy, the late ambassador of the
United States to the Court of St. James, living on the date hereof.
The right of the Depositor to repurchase all of the Mortgage Loans is
conditioned upon the Pool Stated Principal Balance as of the Final Distribution
Date being less than 1% of the Cut-off Date Pool Principal Balance. If such
right is exercised, the Trustee shall, promptly following payment of the
purchase price, release to the Depositor or its designee the Mortgage Files
pertaining to the Mortgage Loans being purchased.
Notice of any termination, specifying the Final Distribution Date
(which shall be a date that would otherwise be a Distribution Date) upon which
the Certificateholders may surrender their Certificates to the Trustee for
payment of the final distribution and for cancellation, shall be given promptly
by the Depositor (if exercising its right to purchase the
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assets of the Trust) or by the Trustee (in any other case) by letter to
Certificateholders mailed not earlier than the 15th day and not later than the
20th day of the month next preceding the month of such final distribution
specifying (1) the Final Distribution Date upon which final payment of the
Certificates will be made upon presentation and surrender of Certificates at the
office or agency of the Trustee therein designated, (2) the amount of any such
final payment and (3) that the Record Date otherwise applicable to such
Distribution Date is not applicable, payments being made only upon presentation
and surrender of the Certificates at the office or agency of the Trustee therein
specified. If the Depositor is obligated to give notice to Certificateholders as
aforesaid, it shall give such notice to the Trustee and the Certificate
Registrar at the time such notice is given to Certificateholders. In the event
such notice is given by the Depositor, the Depositor shall deposit in the
Certificate Account on or before the Final Distribution Date in immediately
available funds an amount equal to the amount necessary to make the amount, if
any, on deposit in the Certificate Account on the Final Distribution Date equal
to the purchase price for the related assets of the Trust computed as above
provided together with a statement as to the amount to be distributed on each
Class of Certificates pursuant to the next succeeding paragraph.
Upon presentation and surrender of the Certificates, the Trustee shall
cause to be distributed to Certificateholders of each Class, in the order set
forth in Section 5.02 hereof, on the Final Distribution Date and in proportion
to their respective Percentage Interests, with respect to Certificateholders of
the same Class, an amount equal to (I) as to each Class of Certificates, the
Class Certificate Balance thereof plus (a) accrued interest thereon in the case
of an interest bearing Certificate and (b) the Class A-PO Deferred Amount with
respect to the Class A-PO Certificates, and (II) as to the Class A-R and A-LR
Certificates, the amounts, if any, which remain on deposit in the Upper-Tier
Certificate Account and the Certificate Account, respectively (other than the
amounts retained to meet claims) after application pursuant to clause (I) above.
An amount shall be distributed in respect of interest and principal to the
Uncertificated Lower-Tier Interests in the same amounts as distributed to their
Corresponding Upper-Tier Class or Classes.
If all of the Certificateholders do not surrender their Certificates
for final payment and cancellation on or before the Final Distribution Date, the
Trustee shall on such date cause all funds in the Certificate Account not
distributed in final distribution to Certificateholders to continue to be held
by the Trustee in an Eligible Account for the benefit of such Certificateholders
and the Depositor (if it exercised its right to purchase the assets of the Trust
Estate) or the Trustee (in any other case) shall give a second written notice to
the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If within
one year after the second notice all the Certificates shall not have been
surrendered for cancellation, the Trustee may take appropriate steps, or may
appoint an agent to take appropriate steps, to contact the remaining
Certificateholders concerning surrender of their Certificates, and the cost
thereof shall be paid out of the funds on deposit in such Eligible Account.
Section 10.02 Additional Termination Requirements.
(a) If the Depositor exercises its purchase option as provided in
Section 10.01, the Trust shall be terminated in accordance with the following
additional requirements, unless the
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Trustee has received an Opinion of Counsel to the effect that the failure of the
Trust to comply with the requirements of this Section 10.02 will not (i) result
in the imposition of taxes on "prohibited transactions" of the Trust as defined
in Section 860F of the Code, or (ii) cause the Trust Estate to fail to qualify
as two separate REMICs at any time that any Certificates are outstanding:
(i) within 90 days prior to the Final Distribution Date set forth in
the notice given by the Depositor under Section 10.01, the Trustee shall
sell all of the assets of the Trust Estate to the Depositor for cash; and
(ii) the notice given by the Depositor or the Trustee pursuant to
Section 10.01 shall provide that such notice constitutes the adopting of a
plan of complete liquidation of the Upper-Tier REMIC and the Lower-Tier
REMIC as of the date of such notice (or, if earlier, the date on which such
notice was mailed to Certificateholders). The Trustee shall also specify
such date in the final tax return of the Upper-Tier REMIC and Lower-Tier
REMIC.
(b) By their acceptance of the Residual Certificates, the Holders
thereof hereby agree to take such other action in connection with such plan of
complete liquidation as may be reasonably requested by the Depositor.
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01 Amendment. This Agreement may be amended from time to
time by the Depositor, the Servicer and the Trustee without the consent of any
of the Certificateholders, (i) to cure any ambiguity or mistake, (ii) to correct
or supplement any provisions herein or therein which may be inconsistent with
any other provisions of this Agreement, any amendment to this Agreement or the
related Prospectus Supplement, (iii) to modify, eliminate or add to any of its
provisions to such extent as shall be necessary to maintain the qualification of
the Upper-Tier REMIC and the Lower-Tier REMIC as REMICs at all times that any
Certificates are outstanding or to avoid or minimize the risk of the imposition
of any tax on the REMIC pursuant to the Code that would be a claim against the
Trust Estate, provided that (a) the Trustee has received an Opinion of Counsel
to the effect that such action is necessary or desirable to maintain such
qualification or to avoid or minimize the risk of the imposition of any such tax
and (b) such action shall not, as evidenced by such Opinion of Counsel,
adversely affect in any material respect the interests of any Certificateholder,
(iv) to change the timing and/or nature of deposits into the Certificate Account
provided that (a) such change shall not, as evidenced by an Opinion of Counsel,
adversely affect in any material respect the interests of any Certificateholder
and (b) such change shall not adversely affect the then-current rating of the
Senior Certificates, the Class B-1 Certificates, the Class B-2 Certificates, the
Class B-3 Certificates, the Class B-4 Certificates or the Class B-5 Certificates
as evidenced by a letter from each Rating Agency rating such Certificates to
such effect, (v) to reduce the percentage of the Pool Principal Balance at which
the Depositor will have the option to purchase all the remaining Mortgage Loans
in accordance with Section 10.01, provided that such reduction is considered
necessary by the Depositor, as evidenced by an Officer's Certificate delivered
to the Trustee, to
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preserve the treatment of the transfer of the Mortgage Loans to the Depositor by
the Seller or to the Trust by the Depositor as sale for accounting purposes, and
(vi) to make any other provisions with respect to matters or questions arising
under this Agreement which shall not be materially inconsistent with the
provisions of this Agreement, provided that such action shall not, as evidenced
by an Opinion of Counsel, adversely affect in any material respect the interests
of any Certificateholder, provided that the amendment shall not be deemed to
adversely affect in any material respect the interests of the Certificateholders
and no Opinion of Counsel to that effect shall be required if the Person
requesting the amendment obtains a letter from each Rating Agency stating that
the amendment would not result in the downgrading or withdrawal of the
respective ratings then assigned to the Certificates.
This Agreement may also be amended from time to time by the Depositor,
the Servicer and the Trustee, with the consent of the Holders of Certificates of
each Class of Certificates which is affected by such amendment, evidencing, as
to each such Class of Certificates, Percentage Interests aggregating not less
than 66-2/3%, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Agreement or of modifying in
any manner the rights of the Holders of such Certificates; provided, however,
that no such amendment shall (A) reduce in any manner the amount of, or delay
the timing of, collections of payments on Mortgage Loans or distributions which
are required to be made on any Certificate without the consent of the Holder of
such Certificate or (B) reduce the aforesaid percentage required to consent to
any such amendment, without the consent of the Holders of all Certificates then
Outstanding.
Prior to the solicitation of consent of Certificateholders in
connection with any such amendment, the party seeking such amendment shall
furnish the Trustee with an Opinion of Counsel stating whether such amendment
would adversely affect the qualification of the Upper-Tier REMIC or the
Lower-Tier REMIC as REMICs and notice of the conclusion expressed in such
Opinion of Counsel shall be included with any such solicitation. An amendment
made with the consent of all Certificateholders and executed in accordance with
this Section 11.01 shall be permitted or authorized by this Agreement
notwithstanding that such Opinion of Counsel may conclude that such amendment
would adversely affect the qualification of the Upper-Tier REMIC or the
Lower-Tier REMIC as REMICs.
Promptly after the execution of any such amendment or consent the
Trustee shall furnish written notification of the substance of or a copy of such
amendment to each Certificateholder and to each Rating Agency.
It shall not be necessary for the consent of Certificateholders under
this Section 11.01 to approve the particular form of any proposed amendment, but
it shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Certificateholders shall be subject to such reasonable
requirements as the Trustee may prescribe.
Section 11.02 Recordation of Agreement. This Agreement is subject to
recordation in all appropriate public offices for real property records in all
the counties or other comparable jurisdictions in which any or all of the
properties subject to the Mortgages are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be
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effected by the Servicer and at its expense on direction by the Trustee, who
will act at the direction of Holders of Certificates evidencing not less than
50% of all Voting Rights, but only upon direction of the Trustee accompanied by
an Opinion of Counsel to the effect that such recordation materially and
beneficially affects the interests of Certificateholders.
For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
Section 11.03 Limitation on Rights of Certificateholders. The death or
incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a partition or winding up of the Trust,
nor otherwise affect the rights, obligations and liabilities of the parties
hereto or any of them.
No Certificateholder shall have any right to vote (except as provided
herein) or in any manner otherwise control the operation and management of the
Trust, or the obligations of the parties hereto, nor shall anything herein set
forth, or contained in the terms of the Certificates, be construed so as to
constitute the Certificateholders from time to time as partners or members of an
association; nor shall any Certificateholder be under any liability to any third
person by reason of any action taken by the parties to this Agreement pursuant
to any provision hereof.
No Certificateholder shall have any right by virtue or by availing
itself of any provisions of this Agreement to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this Agreement,
unless such Holder previously shall have given to the Trustee a written notice
of default and of the continuance thereof, as provided herein, and unless also
the Holders of Certificates evidencing Percentage Interests aggregating not less
than 25% of each Class of Certificates affected thereby shall have made written
request upon the Trustee to institute such action, suit or proceeding in its own
name as Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs, expenses and liabilities to be
incurred therein or thereby, and the Trustee, for 60 days after its receipt of
such notice, request and offer of indemnity, shall have neglected or refused to
institute any such action, suit or proceeding; it being understood and intended,
and being expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more Holders of Certificates
shall have any right in any manner whatever by virtue or by availing itself or
themselves of any provisions of this Agreement to affect, disturb or prejudice
the rights of the Holders of any other of the Certificates, or to obtain or seek
to obtain priority over or preference to any other such Holder, or to enforce
any right under this Agreement, except in the manner herein provided and for the
equal, ratable and common benefit of all Certificateholders. For the protection
and enforcement of the provisions of this Section 11.03, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
Section 11.04 Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
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APPLICATION OF THE CONFLICTS OF LAWS PROVISIONS THEREOF, AND THE OBLIGATIONS,
RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE
WITH SUCH LAWS.
Section 11.05 Notices. All demands, notices, instructions, directions,
requests and communications required to be delivered hereunder shall be in
writing and shall be deemed to have been duly given if personally delivered at
or mailed by certified mail, return receipt requested, (provided, however, that
notices to the Trustee may be delivered by facsimile and shall be deemed
effective upon receipt ) to (a) in the case of the Depositor, Wachovia Asset
Securitization Issuance, LLC, One Wachovia Center, 301 South College Street,
Charlotte, North Carolina 28202, Attention: General Counsel and Chief Financial
Officer, (b) in the case of the Servicer, __________, __________, __________,
Attention: __________, __________, (c) in the case of the Trustee, ___________,
__________, __________, Attention:__________,(d) in the case of __________,
__________, __________, __________, __________, Attn: __________, and (e) in the
case of __________, __________, __________, __________, Attn: __________; or, as
to each party, at such other address as shall be designated by such party in a
written notice to each other party. Any notice required or permitted to be
mailed to a Certificateholder shall be given by first class mail, postage
prepaid, at the address of such Holder as shown in the Certificate Register. Any
notice so mailed within the time prescribed in this Agreement shall be
conclusively presumed to have been duly given, whether or not the
Certificateholder receives such notice.
Section 11.06 Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or the rights of the Holders thereof.
Section 11.07 Certificates Nonassessable and Fully Paid. It is the
intention of the Trustee that Certificateholders shall not be personally liable
for obligations of the Trust Estate, that the beneficial ownership interests
represented by the Certificates shall be nonassessable for any losses or
expenses of the Trust Estate or for any reason whatsoever, and that Certificates
upon execution, countersignature and delivery thereof by the Trustee pursuant to
Section 6.01 are and shall be deemed fully paid.
Section 11.08 Access to List of Certificateholders. The Certificate
Registrar will furnish or cause to be furnished to the Trustee, within 15 days
after the receipt of a request by the Trustee in writing, a list, in such form
as the Trustee may reasonably require, of the names and addresses of the
Certificateholders as of the most recent Record Date for payment of
distributions to Certificateholders.
If three or more Certificateholders apply in writing to the Trustee,
and such application states that the applicants desire to communicate with other
Certificateholders with respect to their rights under this Agreement or under
the Certificates and is accompanied by a copy of the communication which such
applicants propose to transmit, then the Trustee shall, within five Business
Days after the receipt of such application, afford such applicants access during
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normal business hours to the most recent list of Certificateholders held by the
Trustee. If such a list is as of a date more than 90 days prior to the date of
receipt of such applicants' request, the Trustee shall promptly request from the
Certificate Registrar a current list as provided above, and shall afford such
applicants access to such list promptly upon receipt.
Every Certificateholder, by receiving and holding such list, agrees
with the Certificate Registrar and the Trustee that neither the Certificate
Registrar nor the Trustee shall be held accountable by reason of the disclosure
of any such information as to the names and addresses of the Certificateholders
hereunder, regardless of the source from which such information was derived.
Section 11.09 Recharacterization. The parties to this Agreement intend
the conveyance by the Depositor to the Trustee of all of its right, title and
interest in and to the Mortgage Loans pursuant to this Agreement to constitute a
purchase and sale and not a loan. Notwithstanding the foregoing, to the extent
that such conveyance is held not to constitute a sale under applicable law, it
is intended that this Agreement shall constitute a security agreement under
applicable law and that the Depositor shall be deemed to have granted to the
Trustee a first priority security interest in all of the Depositor's right,
title and interest in and to the Mortgage Loans.
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EXHIBIT 4.1
IN WITNESS WHEREOF, the Depositor, the Servicer and the Trustee have
caused this Agreement to be duly executed by their respective officers thereunto
duly authorized to be hereunto affixed, all as of the day and year first above
written.
WACHOVIA ASSET SECURITIZATION
ISSUANCE, LLC,
as Depositor
By:
----------------------------
Name:
Title:
[ ],
as Servicer
By:
----------------------------
Name:
Title:
[ ],
as Trustee
By:
----------------------------
Name:
Title:
EXHIBIT 4.1
STATE OF )
) ss.:
COUNTY OF )
)
On the th day of _______________, 200___, before me, a notary public
in and for the State of _____________, personally appeared _________________,
known to me who, being by me duly sworn, did depose and say that s/he is a
________________ of ____________________, a __________________, one of the
parties that executed the foregoing instrument; and that s/he signed his/her
name thereto by order of the Board of Directors of such corporation.
_______________________________
Notary Public
[Notarial Seal]
My commission expires ____________.
EXHIBIT 4.1
STATE OF )
) ss.:
COUNTY OF )
)
On the th day of _____________, 200__, before me, a notary public in
and for the State of ____________, personally appeared _______________, known to
me who, being by me duly sworn, did depose and say that s/he is the ____________
of Wachovia Asset Securitization Issuance LLC, a North Carolina limited
liability company, one of the parties that executed the foregoing instrument;
and that she signed her name thereto by order of the [Board of Directors] of
such limited liability company.
_______________________________
Notary Public
[Notarial Seal]
My commission expires ____________.
EXHIBIT 4.1
STATE OF )
) ss.:
COUNTY OF )
)
On the th day of __________, 200___, before me, a notary public in and
for the State of __________, personally appeared __________, known to me who,
being by me duly sworn, did depose and say that he is the ___________________of
, a national banking association, one of the parties that executed the foregoing
instrument; and that he signed her name thereto by order of the Board of
Directors of such association.
_______________________________
Notary Public
[Notarial Seal]
My commission expires ____________.