Exhibit 4.2.1
ACE SECURITIES CORP.
Depositor
[
]
Servicer
[
]
Master Servicer and Securities
Administrator
[
]
Trustee
FORM OF
POOLING AND SERVICING
AGREEMENT
Dated as of [
], 200[ ]
ACE Securities Corp. [
]
Asset Backed Pass-Through Certificates
TABLE OF CONTENTS
ARTICLE I DEFINITIONS
4
SECTION 1.01.
Defined Terms.
4
SECTION 1.02.
Allocation of Certain Interest
Shortfalls.
51
ARTICLE II CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE
OF CERTIFICATES
54
SECTION 2.01.
Conveyance of the Mortgage
Loans.
54
SECTION 2.02.
Acceptance of REMIC I by
Trustee.
55
SECTION 2.03.
Repurchase or Substitution of Mortgage
Loans.
55
SECTION 2.04.
Representations and Warranties of the
Master Servicer.
58
SECTION 2.05.
Representations, Warranties and Covenants
of the Servicer.
60
SECTION 2.06.
Issuance of the REMIC I Regular Interests
and the Class [____]
Interest.
62
SECTION 2.07.
Conveyance of the REMIC I [____________];
Acceptance of REMIC
II and REMIC III by the
Trustee.
62
SECTION 2.08.
Issuance of Residual
Certificates.
63
SECTION 2.09.
Establishment of the Trust.
63
SECTION 2.10.
Purposes and Powers of the
Trust .
63
ARTICLE III ADMINISTRATION AND SERVICING
OF THE MORTGAGE
LOANS; ACCOUNTS
65
SECTION 3.01.
The Servicer to Act as
Servicer.
65
SECTION 3.02.
Sub-Servicing Agreements Between the
Servicer and Sub-Servicers.
68
SECTION 3.03.
Successor Sub-Servicers.
68
SECTION 3.04.
No Contractual Relationship Between
Sub-Servicer, Trustee or the
Certificateholders.
69
SECTION 3.05.
Assumption or Termination of
Sub-Servicing Agreement by Successor
Servicer.
69
SECTION 3.06.
Collection of Certain Mortgage Loan
Payments.
69
SECTION 3.07.
Collection of Taxes, Assessments and
Similar Items; Servicing
Accounts.
70
SECTION 3.08.
Collection Account and Distribution
Account.
71
SECTION 3.09.
Withdrawals from the Collection Account
and Distribution Account.
73
SECTION 3.10.
Investment of Funds in the Investment
Accounts.
75
SECTION 3.11.
Maintenance of Hazard Insurance, Errors
and Omissions and Fidelity
Coverage and Primary Mortgage
Insurance.
77
SECTION 3.12.
Enforcement of Due-on-Sale Clauses;
Assumption Agreements
79
SECTION 3.13.
Realization Upon Defaulted Mortgage
Loans.
80
SECTION 3.14.
Trustee to Cooperate; Release of Mortgage
Files.
82
SECTION 3.15.
Servicing Compensation.
83
SECTION 3.16.
Collection Account Statements.
83
SECTION 3.17.
Annual Statement as to
Compliance.
84
SECTION 3.18.
Assessments of Compliance and Attestation
Reports.
84
SECTION 3.19.
[Reserved].
87
SECTION 3.20.
Access to Certain
Documentation.
87
SECTION 3.21.
Title, Management and Disposition of REO
Property.
87
SECTION 3.22.
Obligations of the Servicer in Respect of
Prepayment Interest
Shortfalls; Relief Act Interest
Shortfalls.
91
SECTION 3.23.
Obligations of the Servicer in Respect of
Mortgage Rates and Monthly
Payments.
91
SECTION 3.24.
Reserve Fund.
91
SECTION 3.25.
Advance Facility.
93
SECTION 3.26.
The Servicer Indemnification.
95
SECTION 3.27.
Intention of the Parties and
Interpretation.
95
ARTICLE IV ADMINISTRATION AND MASTER
SERVICING OF THE
MORTGAGE LOANS BY THE MASTER
SERVICER
96
SECTION 4.01.
Master Servicer.
96
SECTION 4.02.
REMIC-Related Covenants.
97
SECTION 4.03.
Monitoring of Servicer and Interim
Servicer.
97
SECTION 4.04.
Fidelity Bond.
99
SECTION 4.05.
Power to Act; Procedures.
99
SECTION 4.06.
Due-on-Sale Clauses; Assumption
Agreements.
100
SECTION 4.07.
Documents, Records and Funds in
Possession of Master Servicer To
Be Held for Trustee.
100
SECTION 4.08.
Standard Hazard Insurance and Flood
Insurance Policies.
101
SECTION 4.09.
Presentment of Claims and Collection of
Proceeds.
101
SECTION 4.10.
Maintenance of Primary Mortgage Insurance
Policies.
101
SECTION 4.11.
Trustee to Retain Possession of Certain
Insurance Policies and
Documents.
102
SECTION 4.12.
Realization Upon Defaulted Mortgage
Loans.
102
SECTION 4.13.
Compensation for the Master
Servicer.
102
SECTION 4.14.
REO Property.
103
SECTION 4.15.
[Reserved].
103
SECTION 4.16.
[Reserved].
103
SECTION 4.17.
[Reserved.]
103
SECTION 4.18.
Obligation of the Master Servicer in
Respect of Prepayment Interest
Shortfalls.
103
SECTION 4.19.
Prepayment Penalty
Verification.
104
ARTICLE V PAYMENTS TO
CERTIFICATEHOLDERS
105
SECTION 5.01.
Distributions.
105
SECTION 5.02.
Distribution Date Statements to
Certificateholders.
117
SECTION 5.03.
Servicer Reports; P&I
Advances.
120
SECTION 5.04.
Allocation of Realized Losses.
122
SECTION 5.05.
Compliance with Withholding
Requirements.
124
SECTION 5.06.
Reports Filed with Securities and
Exchange Commission.
124
SECTION 5.07.
Supplemental Interest Trust.
130
SECTION 5.08.
Tax Treatment of Swap Payments and Swap
Termination Payments.
132
ARTICLE VI THE CERTIFICATES
133
SECTION 6.01.
The Certificates.
133
SECTION 6.02.
Registration of Transfer and Exchange of
Certificates.
135
SECTION 6.03.
Mutilated, Destroyed, Lost or Stolen
Certificates.
141
SECTION 6.04.
Persons Deemed Owners.
141
SECTION 6.05.
Certain Available Information.
142
ARTICLE VII THE DEPOSITOR, THE SERVICER
AND THE MASTER SERVICER
143
SECTION 7.01.
Liability of the Depositor, the Servicer
and the Master Servicer.
143
SECTION 7.02.
Merger or Consolidation of the Depositor,
the Servicer or the Master
Servicer.
143
SECTION 7.03.
Limitation on Liability of the Depositor,
the Servicer, the Master
Servicer and Others.
143
SECTION 7.04.
Limitation on Resignation of the
Servicer.
144
SECTION 7.05.
Limitation on Resignation of the Master
Servicer.
146
SECTION 7.06.
Assignment of Master
Servicing.
146
SECTION 7.07.
Rights of the Depositor in Respect of the
Servicer and the Master
Servicer.
147
SECTION 7.08.
Duties of the Credit Risk
Manager.
148
SECTION 7.09.
Limitation Upon Liability of the Credit
Risk Manager.
148
SECTION 7.10.
Removal of the Credit Risk
Manager.
148
ARTICLE VIII DEFAULT
149
SECTION 8.01.
Servicer Events of Default.
149
SECTION 8.02.
Master Servicer to Act; Appointment of
Successor.
153
SECTION 8.03.
Notification to
Certificateholders.
154
SECTION 8.04.
Waiver of Events of Default.
155
ARTICLE IX CONCERNING THE TRUSTEE AND THE
SECURITIES ADMINISTRATOR
156
SECTION 9.01.
Duties of Trustee and Securities
Administrator.
156
SECTION 9.02.
Certain Matters Affecting Trustee and
Securities Administrator.
157
SECTION 9.03.
Trustee and Securities Administrator not
Liable for Certificates or
Mortgage Loans.
159
SECTION 9.04.
Trustee and Securities Administrator May
Own Certificates.
160
SECTION 9.05.
Fees and Expenses of Trustee and
Securities Administrator.
160
SECTION 9.06.
Eligibility Requirements for Trustee and
Securities Administrator.
161
SECTION 9.07.
Resignation and Removal of Trustee and
Securities Administrator.
161
SECTION 9.08.
Successor Trustee or Securities
Administrator.
162
SECTION 9.09.
Merger or Consolidation of Trustee or
Securities Administrator.
163
SECTION 9.10.
Appointment of Co-Trustee or Separate
Trustee.
163
SECTION 9.11.
Appointment of Office or
Agency.
164
SECTION 9.12.
Representations and
Warranties.
164
ARTICLE X TERMINATION
166
SECTION 10.01.
Termination Upon Repurchase or
Liquidation of All Mortgage Loans.
166
SECTION 10.02.
Additional Termination
Requirements.
168
ARTICLE XI REMIC PROVISIONS
170
SECTION 11.01.
REMIC Administration.
170
SECTION 11.02.
Prohibited Transactions and
Activities.
173
SECTION 11.03.
Indemnification.
173
ARTICLE XII MISCELLANEOUS
PROVISIONS
175
SECTION 12.01.
Amendment.
175
SECTION 12.02.
Recordation of Agreement;
Counterparts.
176
SECTION 12.03.
Limitation on Rights of
Certificateholders.
176
SECTION 12.04.
Governing Law.
177
SECTION 12.05.
Notices.
177
SECTION 12.06.
Severability of Provisions.
178
SECTION 12.07.
Notice to Rating Agencies.
178
SECTION 12.08.
Article and Section
References.
179
SECTION 12.09.
Grant of Security Interest.
179
SECTION 12.10.
Survival of Indemnification.
180
SECTION 12.11.
Interim Servicing Agreement.
180
Exhibits
Exhibit A-1
Form of Class [____]
Certificate
Exhibit A-2
Form of Class [____]
Certificate
Exhibit B-1
Form of Transferor Representation Letter
and Form of Transferee Representation Letter in Connection with
Transfer of the Class [____] Certificates and Residual Certificates
Pursuant to Rule 144A Under the Securities Act
Exhibit B-2
Form of Transferor Representation Letter
and Form of Transferee Representation Letter in Connection with
Transfer of the Class [____] Certificates and Residual Certificates
Pursuant to Rule 501(a) Under the Securities Act
Exhibit B-3
Form of Transfer Affidavit and Agreement
and Form of Transferor Affidavit in Connection with Transfer of
Residual Certificates
[Exhibit [C-1]
Form of Initial Certification of
Custodian]
[Exhibit [C-2]
Form of Final Certification of
Custodian]
Exhibit [D]
Form of Power of Attorney
Exhibit [E-1]
Form of Assessment of
Compliance
[Exhibit [E-2]
Form of Custodian’s Assessment of
Compliance]
Exhibit [F]
Form 10-D Disclosure
Exhibit [G]
Form 10-K Disclosure
Exhibit [H]
Form 8-K Disclosure
Exhibit [I]
Additional Disclosure
Notification
Exhibit [J]
Form of Annual Notification
Exhibit [K]
Relevant Servicing Criteria
Schedule 1
Mortgage Loan Schedule
Schedule 2
[Prepayment Charge Schedule]
Schedule 3
[Reserved.]
This Pooling and Servicing Agreement, is
dated and effective as of [_____________], 200[__], among ACE
SECURITIES CORP., as Depositor, [_________________], as Servicer,
[_________________], as Master Servicer and Securities
Administrator and [_________________], as Trustee.
PRELIMINARY STATEMENT:
The Depositor intends to sell
pass-through certificates to be issued hereunder in multiple
classes, which in the aggregate will evidence the entire beneficial
ownership interest of the Trust Fund created hereunder. The Trust
Fund will consist of a segregated pool of assets comprised of the
Mortgage Loans and certain other related assets subject to this
Agreement.
REMIC I
As provided herein, the Trustee will
elect to treat the segregated pool of assets consisting of the
Mortgage Loans and certain other related assets subject to this
Agreement (other than the Reserve Fund and, for the avoidance of
doubt, the Supplemental Interest Trust and the Swap Agreement) as a
REMIC for federal income tax purposes, and such segregated pool of
assets will be designated as “REMIC I”. The Class [__]
Interest will be the sole class of “residual interests”
in REMIC I for purposes of the REMIC Provisions (as defined
herein). The following table irrevocably sets forth the
designation, the REMIC I Remittance Rate, the initial
Uncertificated Balance and, for purposes of satisfying Treasury
regulation Section 1.860G-1(a)(4)(iii), the “latest possible
maturity date” for each of the REMIC I Regular Interests (as
defined herein). None of the REMIC I Regular Interests will be
certificated.
|
Designation
|
|
REMIC I
Remittance Rate
|
|
Initial
Uncertificated Balance
|
|
Latest Possible
Maturity Date (1)
|
|
|
[____________]
|
|
[____________] (2)
|
|
|
[____________]
|
|
[____________]
|
|
|
[____________]
|
|
[____________] (2)
|
|
|
[____________]
|
|
[____________]
|
|
|
[____________]
|
|
[____________] (2)
|
|
|
[____________]
|
|
[____________]
|
|
________________
|
(1)
|
[For purposes of Section
1.860G-1(a)(4)(iii) of the Treasury regulations, the Distribution
Date immediately following the maturity date for the Mortgage Loan
with the latest maturity date has been designated as the
“latest possible maturity date” for each REMIC I
Regular Interest.]
|
|
(2)
|
[Calculated in accordance with the
definition of “REMIC I Remittance Rate”
herein.]
|
REMIC II
As provided herein, the Trustee will
elect to treat the segregated pool of assets consisting of the
REMIC I Regular Interests as a REMIC for federal income tax
purposes, and such segregated pool of assets will be designated as
“REMIC II.” The Class [__] Interest will evidence the
sole class of “residual interests” in REMIC II for
purposes of the REMIC Provisions. The following table irrevocably
sets forth the designation, the REMIC II Remittance Rate, the
initial aggregate Uncertificated Balance and, for purposes of
satisfying Treasury regulation Section 1.860G-1(a)(4)(iii), the
“latest possible maturity date” for each of the REMIC
II Regular Interests. None of the REMIC II Regular Interests
will be certificated.
|
|
|
INITIAL
UNCERTIFICATED BALANCE
|
LATEST POSSIBLE
MATURITY DATE (1)
|
|
[____________]
|
[____________] (2)
|
[____________]
|
[____________]
|
|
[____________]
|
[____________] (2)
|
[____________]
|
[____________]
|
|
[____________]
|
[____________] (2)
|
[____________]
|
[____________]
|
___________________________
(1)
[For purposes of Section
1.860G-1(a)(4)(iii) of the Treasury regulations, the Distribution
Date immediately following the maturity date for the Mortgage Loan
with the latest maturity date has been designated as the
“latest possible maturity date” for each REMIC II
Regular Interest.]
(2)
[Calculated in accordance
with the definition of “REMIC II Remittance Rate”
herein.]
(3)
[REMIC II Regular
Interest [] will not have an Uncertificated Balance, but will
accrue interest on its Uncertificated Notional Amount.]
REMIC III
As provided herein, the Trustee will
elect to treat the segregated pool of assets consisting of the
REMIC II Regular Interests as a REMIC for federal income tax
purposes, and such segregated pool of assets will be designated as
“REMIC III.” The Class [__] Interest will evidence the
sole class of “residual interests” in REMIC III for
purposes of the REMIC Provisions. The following table irrevocably
sets forth the designation, the Pass-Through Rate, the initial
aggregate Certificate Principal Balance and, for purposes of
satisfying Treasury regulation Section 1.860G-1(a)(4)(iii), the
“latest possible maturity date” for the indicated
Classes of Certificates.
|
|
|
Initial Aggregate Certificate Principal Balance
|
Latest Possible
Maturity Date (1)
|
|
[____________]
|
[____________]
(2)
|
[____________]
|
[____________]
|
|
[____________]
|
[____________]
(2)
|
[____________]
|
[____________]
|
|
[____________]
|
[____________]
(2)
|
[____________]
|
[____________]
|
As of the Cut-off Date, the
[_________________] had an aggregate Scheduled Principal Balance
equal to approximately $[____________] and the [_________________]
had an aggregate Scheduled Principal Balance equal to approximately
$[____________].
_________________
(1)
[For purposes of Section
1.860G-1(a)(4)(iii) of the Treasury regulations, the Distribution
Date immediately following the maturity date for the Mortgage Loan
with the latest maturity date has been designated as the
“latest possible maturity date” for each Class of
Certificates.]
(2)
[Calculated in accordance
with the definition of “Pass-Through Rate”
herein.
(3)
[The Class []
Certificates will not accrue interest.]
(4)
[The Class []
Certificates will accrue interest at their variable Pass-Through
Rate on the Notional Amount of the Class CE Certificates
outstanding from time to time which shall equal the Uncertificated
Balance of the REMIC II Regular Interests (other than REMIC II
Regular Interest []). The Class [] Certificates will not accrue
interest on their Certificate Principal Balance.]
(5)
[The Class [] Interest
will not have a Pass-Through Rate or a Certificate Principal
Balance, but will be entitled to 100% of amounts distributed on
REMIC II Regular Interest [].]
In consideration of the mutual agreements
herein contained, the Depositor, the Servicer, the Master Servicer,
the Securities Administrator and the Trustee agree as
follows:
ARTICLE I
DEFINITIONS
SECTION 1.01.
Defined Terms.
Whenever used in this Agreement,
including, without limitation, in the Preliminary Statement hereto,
the following words and phrases, unless the context otherwise
requires, shall have the meanings specified in this Article. Unless
otherwise specified, all calculations described herein shall be
made on the basis of a 360-day year consisting of twelve 30-day
months.
“ Accepted Master Servicing
Practices ”: With respect to any Mortgage Loan, as
applicable, either (x) those customary mortgage master servicing
practices of prudent mortgage servicing institutions that master
service mortgage loans of the same type and quality as such
Mortgage Loan in the jurisdiction where the related Mortgaged
Property is located, to the extent applicable to the Master
Servicer (except in its capacity as successor to any Servicer), or
(y) as provided in Section 3.01 hereof, but in no event below the
standard set forth in clause (x).
“Accountant’s
Attestation” : As
defined in Section 3.18(b)(i).
“ Accepted Servicing
Practices ”: As defined in Section 3.01.
“ Account ”: The
Collection Account and the Distribution Account as the context may
require.
“ Accrued Certificate
Interest ”: With respect to any Class [__] Certificate,
[______] Certificate and each Distribution Date, interest accrued
during the related Interest Accrual Period at the Pass-Through Rate
for such Certificate for such Distribution Date on the Certificate
Principal Balance, in the case of the Class [__] Certificates, the
[___] Certificates, or on the Notional Amount in the case of the
Class [__] Certificates, of such Certificate immediately prior to
such Distribution Date. The Class [__] Certificates are not
entitled to distributions in respect of interest and, accordingly,
will not accrue interest. All distributions of interest on
the Class [__] Certificates, the [__________] Certificates and the
Class [__] Certificates will be calculated on the basis of a
360-day year and the actual number of days in the applicable
Interest Accrual Period. All distributions of interest on the
Class [__] Certificates will be based on a 360-day year consisting
of twelve 30-day months. Accrued Certificate Interest with
respect to each Distribution Date, as to any Class [__]
Certificate, [__________] Certificate or Class [__] Certificate
shall be reduced by an amount equal to the portion allocable to
such Certificate pursuant to Section 1.02 hereof, if any, of the
sum of (a) the aggregate Prepayment Interest Shortfall, if any, for
such Distribution Date to the extent not covered by payments
pursuant to Section 3.21 or Section 4.18 of this Agreement or
pursuant to the Interim Servicing Agreement and (b) the aggregate
amount of any Relief Act Interest Shortfall, if any, for such
Distribution Date. In addition, Accrued Certificate Interest with
respect to each Distribution Date, as to any Class [__]
Certificate, shall be reduced by an amount equal to the portion
allocable to such Class [__] Certificate of Realized Losses, if
any, pursuant to Section 1.02 and Section 5.04 hereof.
“Additional Form 10-D
Disclosure” : As
defined in Section 5.06.
“Additional Form 10-K
Disclosure” : As
defined in Section 5.06.
“Additional
Servicer” : Each
Affiliate of the Servicer that services any of the Mortgage Loans
and each person that is not an Affiliate of the Servicer that
services 10% or more of the Mortgage Loans.
“ Adjustable Rate Mortgage
Loan ”: Each of the Mortgage Loans identified in
the Mortgage Loan Schedule as having a Mortgage Rate that is
subject to adjustment.
“ Adjustment Date ”:
With respect to each Adjustable Rate Mortgage Loan, the first day
of the month in which the Mortgage Rate of an Adjustable Rate
Mortgage Loan changes pursuant to the related Mortgage Note. The
first Adjustment Date following the Cut-off Date as to each
Adjustable Rate Mortgage Loan is set forth in the Mortgage Loan
Schedule.
“ Administration Fees
”: The sum of (i) the Servicing Fee, (ii) the Master
Servicing Fee and (iii) the Credit Risk Management Fee.
“ Administration Fee Rate
”: The sum of (i) the Servicing Fee Rate, (ii) the Master
Servicing Fee Rate and (iii) the Credit Risk Management Fee
Rate.
“ Advance Facility ”:
As defined in Section 3.25(a).
“ Advance Financing Person
”: As defined in Section 3.25(a).
“ Advance Reimbursement
Amounts ”: As defined in Section
3.25(b).
“ Affiliate ”: With
respect to any specified Person, any other Person controlling or
controlled by or under common control with such specified Person.
For the purposes of this definition, “control” when
used with respect to any specified Person means the power to direct
the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or
otherwise, and the terms “controlling” and
“controlled” have meanings correlative to the
foregoing.
“ Aggregate Pool Principal
Balance ”: As to any Distribution Date, the aggregate of
the scheduled principal balances of the Mortgage Loans which were
outstanding Mortgage Loans on the Due Date in the month preceding
the month of such Distribution Date.
“ Aggregate Loss Severity
Percentage ”: With respect to any Distribution Date, the
percentage equivalent of a fraction, the numerator of which is the
aggregate amount of Realized Losses incurred on any Mortgage Loans
from the Cut-off Date to the last day of the preceding calendar
month and the denominator of which is the aggregate principal
balance of such Mortgage Loans immediately prior to the liquidation
of such Mortgage Loans.
“ Agreement ”: This
Pooling and Servicing Agreement, including all exhibits and
schedules hereto and all amendments hereof and supplements
hereto.
“ Allocated Realized Loss
Amount ”: With respect to any Class of [____________]
Certificates or Class [__] Certificates and any Distribution Date,
an amount equal to the sum of any Realized Loss allocated to that
Class of Certificates on the Distribution Date and any Allocated
Realized Loss Amount for that Class remaining unpaid from the
previous Distribution Date.
“ Amounts Held for Future
Distribution ”: As to any Distribution Date, the
aggregate amount held in the Custodial Account and the Collection
Account at the close of business on the immediately preceding
Determination Date on account of (i) all Monthly Payments or
portions thereof received in respect of the Mortgage Loans due
after the related Due Period and (ii) Principal Prepayments and
Liquidation Proceeds received in respect of such Mortgage Loans
after the last day of the related Prepayment Period.
“Annual Statement of
Compliance” : As
defined in Section 3.17(a).
“ Assignment ”:
An assignment of Mortgage, notice of transfer or equivalent
instrument, in recordable form, which is sufficient under the laws
of the jurisdiction where the related Mortgaged Property is located
to reflect of record the sale and assignment of the Mortgage, which
assignment, notice of transfer or equivalent instrument may be in
the form of one or more blanket assignments covering Mortgages
secured by Mortgaged Properties located in the same county, if
permitted by law.
“Assessment of
Compliance” : As
defined in Section 3.18(i)(a).
“ Available Distribution
Amount ”: With respect to any Distribution Date, an
amount equal to (1) the sum of (a) the aggregate of the amounts on
deposit in the Custodial Account, the Collection Account and the
Distribution Account as of the close of business on the related
Servicer Remittance Date, (b) the aggregate of any amounts
deposited in the Distribution Account by the Servicer or the Master
Servicer in respect of Prepayment Interest Shortfalls for such
Distribution Date pursuant to Section 3.22 or Section 4.18 of this
Agreement or by the Interim Servicer pursuant to the Interim
Servicing Agreement, (c) the aggregate of any P&I Advances for
such Distribution Date made by the Servicer pursuant to Section
5.03 of this Agreement or by the Interim Servicer pursuant to the
Interim Servicing Agreement and (d) the aggregate of any P&I
Advances made by a successor servicer (including the Master
Servicer) for such Distribution Date pursuant to Section 8.02 of
this Agreement or pursuant to the Interim Servicing Agreement,
reduced (to not less than [
]) by (2) the
portion of the amount described in clause (1)(a) above that
represents (i) Amounts Held for Future Distribution, (ii) Principal
Prepayments on the Mortgage Loans received after the related
Prepayment Period (together with any interest payments received
with such Principal Prepayments to the extent they represent the
payment of interest accrued on the Mortgage Loans during a period
subsequent to the related Prepayment Period), (iii) Liquidation
Proceeds and Insurance Proceeds received in respect of the Mortgage
Loans after the related Prepayment Period, (iv) amounts
reimbursable or payable to the Depositor, the Servicer, the
Trustee, the Master Servicer, the Securities Administrator or the
Custodians pursuant to Section 3.09 or 9.05 of this Agreement or
otherwise payable in respect of Extraordinary Trust Fund Expenses
or reimbursable or payable to the Interim Servicer under the
Interim Servicing Agreement, (v) the Credit Risk Management Fee,
(vi) amounts deposited in the Custodial Account, the Collection
Account or the Distribution Account in error, (vii) the amount of
any Prepayment Charges collected by the Servicer or the Interim
Servicer in connection with the Principal Prepayment of any of the
Mortgage Loans and (viii) amounts reimbursable to a successor
servicer (including the Master Servicer) pursuant to Section 8.02
of this Agreement or pursuant to the Interim Servicing Agreement.
“ Balloon Mortgage Loan
”: A Mortgage Loan that provides for the payment of the
unamortized principal balance of such Mortgage Loan in a single
payment, that is substantially greater than the preceding monthly
payment at the maturity of such Mortgage Loan.
“ Balloon Payment ”:
A payment of the unamortized principal balance of a Mortgage
Loan in a single payment, that is substantially greater than the
preceding Monthly Payment at the maturity of such Mortgage
Loan.
“ Bankruptcy Code ”:
The Bankruptcy Reform Act of 1978 (Title 11 of the United States
Code), as amended.
“ Book-Entry Certificates
”: The Offered Certificates and Class [__] Certificates for
so long as the Certificates of such Class shall be registered in
the name of the Depository or its nominee.
“ Book-Entry Custodian
”: The custodian appointed pursuant to Section
6.01.
“ Business Day ”: Any
day other than a Saturday, a Sunday or a day on which banking or
savings and loan institutions in the States of New York, Maryland,
Minnesota, Florida or in the city in which the Corporate Trust
Office of the Trustee is located, are authorized or obligated by
law or executive order to be closed.
“ Cash-Out Refinancing
”: A Refinanced Mortgage Loan the proceeds of which are more
than a nominal amount in excess of the principal balance of any
existing first mortgage plus any subordinate mortgage on the
related Mortgaged Property and related closing costs.
“ Certificate ”: Any
one of ACE Securities Corp., Asset Backed Pass-Through
Certificates, Series [_____], Class [__] and Class [__]
Certificates issued under this Agreement.
“ Certificate Factor
”: With respect to any Class of Certificates (other than the
Residual Certificates) as of any Distribution Date, a fraction,
expressed as a decimal carried to six places, the numerator of
which is the aggregate Certificate Principal Balance (or Notional
Amount, in the case of the Class [__] Certificates) of such Class
of Certificates on such Distribution Date (after giving effect to
any distributions of principal and allocations of Realized Losses
resulting in reduction of the Certificate Principal Balance (or
Notional Amount, in the case of the Class [__] Certificates) of
such Class of Certificates to be made on such Distribution Date),
and the denominator of which is the initial aggregate Certificate
Principal Balance (or Notional Amount, in the case of the Class
[__] Certificates) of such Class of Certificates as of the Closing
Date.
“ Certificate Margin
”: With respect to the Class [__] Certificates and, for
purposes of the definition of “Marker Rate”, REMIC I
Regular Interest [__],[__]% in the case of each Distribution Date
through and including the Optional Termination Date and [
]% in the case of each Distribution Date
thereafter.
“ Certificateholder ”
or “ Holder ”: The Person in whose name a
Certificate is registered in the Certificate Register, except that
a Disqualified Organization or a Non-United States Person shall not
be a Holder of a Residual Certificate for any purposes hereof, and
solely for the purposes of giving any consent pursuant to this
Agreement, any Certificate registered in the name of or
beneficially owned by the Depositor, the Seller, the Servicer, the
Master Servicer, the Securities Administrator, the Trustee or any
Affiliate thereof shall be deemed not to be outstanding and the
Voting Rights to which it is entitled shall not be taken into
account in determining whether the requisite percentage of Voting
Rights necessary to effect any such consent has been obtained,
except as otherwise provided in Section 12.01. The Trustee and the
Securities Administrator may conclusively rely upon a certificate
of the Depositor, the Seller, the Master Servicer, the Securities
Administrator or the Servicer in determining whether a Certificate
is held by an Affiliate thereof. All references herein to
“Holders” or “Certificateholders” shall
reflect the rights of Certificate Owners as they may indirectly
exercise such rights through the Depository and participating
members thereof, except as otherwise specified herein; provided,
however, that the Trustee and the Securities Administrator shall be
required to recognize as a “Holder” or
“Certificateholder” only the Person in whose name a
Certificate is registered in the Certificate Register.
“ Certificate Owner ”:
With respect to a Book-Entry Certificate, the Person who is the
beneficial owner of such Certificate as reflected on the books of
the Depository or on the books of a Depository Participant or on
the books of an indirect participating brokerage firm for which a
Depository Participant acts as agent.
“ Certificate Principal
Balance ”: With respect to each Class [__] Certificate,
[_____] Certificate or Class [__] Certificate as of any date of
determination, the Certificate Principal Balance of such
Certificate on the Distribution Date immediately prior to such date
of determination plus any Subsequent Recoveries added to the
Certificate Principal Balance of such Certificate pursuant to
Section 5.04, minus all distributions allocable to principal made
thereon and Realized Losses allocated thereto, if any, on such
immediately prior Distribution Date (or, in the case of any date of
determination up to and including the first Distribution Date, the
initial Certificate Principal Balance of such Certificate, as
stated on the face thereof). With respect to each Class [__]
Certificate as of any date of determination, an amount equal to the
Percentage Interest evidenced by such Certificate times the excess,
if any, of (A) the then aggregate Uncertificated Balances of the
REMIC II Regular Interests over (B) the then aggregate Certificate
Principal Balances of the Class [__] Certificates, the [_________]
Certificates and the Class [__] Certificates then outstanding.
The aggregate initial Certificate Principal Balance of each
Class of Regular Certificates is set forth in the Preliminary
Statement hereto.
“ Certificate Register
”: The register maintained pursuant to Section
6.02.
“Certification”
: As specified in Section
5.06(b)(iv).
“Certification
Parties” : As
defined in Section 5.06(b)(iv).
“Certifying
Person” : As
defined in Section 5.06(b)(iv).
“ Class ”:
Collectively, all of the Certificates bearing the same class
designation.
“ Class [__]
Certificate ”: Any Class [__] or Class [__]
Certificate.
“ Class [__] Principal
Distribution Amount ”: The Class [__] Principal
Distribution Amount is an amount equal to the sum of: (i) the Class
[__] Principal Distribution Amount and (ii) the Class [__]
Principal Distribution Amount.
“ Class [__] Allocation
Percentage ”: With respect to any Distribution Date is
the percentage equivalent of a fraction, the numerator of which is
(x) the Group I Principal Remittance Amount for such Distribution
Date and the denominator of which is (y) the Principal Remittance
Amount for such Distribution Date.
“ Class [__]
Certificate ”: Any one of the Class [__]
Certificates executed and authenticated by the Securities
Administrator and delivered by the Trustee, substantially in the
form annexed hereto as Exhibit [__] and evidencing a Regular
Interest in REMIC III for purposes of the REMIC
Provisions.
“ Class [__] Principal
Distribution Amount ”: With respect to any Distribution
Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the Certificate Principal Balance
of the Class [__] Certificates immediately prior to such
Distribution Date over (y) the lesser of (A) the product of (i)
[__]% and (ii) the aggregate Stated Principal Balance of the Group
I Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced and
unscheduled collections of principal received during the related
Prepayment Period) and (B) the aggregate Stated Principal Balance
of the Group I Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due
during the related Due Period, to the extent received or advanced
and unscheduled collections of principal received during the
related Prepayment Period) minus the product of (i) [__]% and (ii)
the aggregate principal balance of the Group I Mortgage Loans as of
the Cut-off Date.
“ Class [__] Allocation
Percentage ”: With respect to any Distribution Date is
the percentage equivalent of a fraction, the numerator of which is
(x) the Group II Principal Remittance Amount for such Distribution
Date and the denominator of which is (y) the Principal Remittance
Amount for such Distribution Date.
“ Class [__]
Certificate ”: Any one of the Class [__]
Certificates executed and authenticated by the Securities
Administrator and delivered by the Trustee, substantially in the
form annexed hereto as Exhibit [__] and evidencing a Regular
Interest in REMIC III for purposes of the REMIC
Provisions.
“ Class [__] Principal
Distribution Amount ”: With respect to any Distribution
Date on or after the Stepdown Date and on which a Trigger Event is
not in effect, the excess of (x) the sum of the Certificate
Principal Balances of the Class [__] and Class [__] Certificates
immediately prior to such Distribution Date over (y) the lesser of
(A) the product of (i) [__]% and (ii) the aggregate Stated
Principal Balance of the Group II Mortgage Loans as of the last day
of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the
extent received or advanced and unscheduled collections of
principal received during the related Prepayment Period) and (B)
the aggregate Stated Principal Balance of the Group II Mortgage
Loans as of the last day of the related Due Period (after giving
effect to scheduled payments of principal due during the related
Due Period, to the extent received or advanced and unscheduled
collections of principal received during the related Prepayment
Period) minus the product of (i) [__]% and (ii) the aggregate
principal balance of the Group II Mortgage Loans as of the Cut-off
Date.
“ Class [__] Interest
”: The uncertificated residual interest in REMIC
[__].
“ Closing Date ”:
[_____________], 200[__].
“ Code ”: The Internal
Revenue Code of 1986 as amended from time to time.
“ Collection Account
”: The account or accounts created and maintained, or caused
to be created and maintained, by the Servicer pursuant to Section
3.08(a) of this Agreement, which shall be entitled
“[_________________]”. The Collection Account
must be an Eligible Account.
“ Commission ”: The
Securities and Exchange Commission.
“ Corporate Trust Office
”: The principal corporate trust office of the Trustee or the
Securities Administrator, as the case may be, at which, at any
particular time, its corporate trust business in connection with
this Agreement shall be administered, which office at the date of
the execution of this instrument is located at (i) with respect to
the Trustee, [_________________], Attention: [_________________],
or at such other address as the Trustee may designate from time to
time by notice to the Certificateholders, the Depositor, the Master
Servicer, the Securities Administrator and the Servicer, or (ii)
with respect to the Securities Administrator, (A) for purposes of
Certificate transfers and surrender, [_________________],
Attention: [_________________], and (B) for all other purposes,
[_________________], Attention: [_________________] (or for
overnight deliveries, at [_________________], Attention:
[_________________]), or at such other address as the Securities
Administrator may designate from time to time by notice to the
Certificateholders, the Depositor, the Master Servicer, the
Servicer and the Trustee.
“ Corresponding Certificate
”: With respect to each REMIC II Regular Interest, as
follows:
REMIC II REGULAR
INTEREST
|
|
|
[____________]
|
[__]
|
|
[____________]
|
[__]
|
|
[____________]
|
[__]
|
“ Credit Enhancement
Percentage ”: For any Distribution Date, the percentage
equivalent of a fraction, the numerator of which is the sum of the
aggregate Certificate Principal Balances of the [____________]
Certificates, the Class [__] Certificates and the Class [__]
Certificates, and the denominator of which is the aggregate Stated
Principal Balance of the Mortgage Loans, calculated after taking
into account distributions of principal on the Mortgage Loans and
distribution of the Principal Distribution Amount to the
Certificates then entitled to distributions of principal on such
Distribution Date.
“ Credit Risk Management
Agreements ”: The agreements between the Credit Risk
Manager and the Servicer and/or Master Servicer, regarding the loss
mitigation and advisory services to be provided by the Credit Risk
Manager.
“ Credit Risk Management Fee
”: The amount payable to the Credit Risk Manager on each
Distribution Date as compensation for all services rendered by it
in the exercise and performance of any and all powers and duties of
the Credit Risk Manager under the Credit Risk Management
Agreements, which amount shall equal one twelfth of the product of
(i) the Credit Risk Management Fee Rate multiplied by (ii) the
Stated Principal Balance of the Mortgage Loans and any related REO
Properties as of the first day of the related Due
Period.
“ Credit Risk Management Fee
Rate ”: [__]% per annum.
“ Credit Risk Manager
”: [____________], a [____________] [____________], and
its successors and assigns.
“ Custodial Account ”:
Shall mean the account maintained by the Interim Servicer under the
Interim Servicing Agreement.
“ Custodial Agreement
”: Either (i) the [____________] or (ii) the [____________],
or any other custodial agreement entered into after the date hereof
with respect to any Mortgage Loan subject to this
Agreement.
“ Custodian ”: Either
[____________] or [____________] or any other custodian appointed
under any custodial agreement entered into after the date of this
Agreement.
“ Cut-off Date ”: With
respect to each Mortgage Loan, [_____________], 200[__]. With
respect to all Qualified Substitute Mortgage Loans, their
respective dates of substitution. References herein to the
“Cut-off Date,” when used with respect to more than one
Mortgage Loan, shall be to the respective Cut-off Dates for such
Mortgage Loans.
“ Debt Service Reduction
”: With respect to any Mortgage Loan, a reduction in the
scheduled Monthly Payment for such Mortgage Loan by a court of
competent jurisdiction in a proceeding under the Bankruptcy Code,
except such a reduction resulting from a Deficient
Valuation.
“ Deficient Valuation
”: With respect to any Mortgage Loan, a valuation of the
related Mortgaged Property by a court of competent jurisdiction in
an amount less than the then outstanding principal balance of the
Mortgage Loan, which valuation results from a proceeding initiated
under the Bankruptcy Code.
“ Definitive Certificates
”: As defined in Section 6.01(b).
“ Deleted Mortgage Loan
”: A Mortgage Loan replaced or to be replaced by a Qualified
Substitute Mortgage Loan.
“ Delinquency Percentage
”: As of the last day of the related Due Period, the
percentage equivalent of a fraction, the numerator of which is the
aggregate Stated Principal Balance of all Mortgage Loans that, as
of the last day of the previous calendar month, are [____________]
([__]) or more days delinquent, are in foreclosure, have been
converted to REO Properties or have been discharged by reason of
bankruptcy, and the denominator of which is the aggregate Stated
Principal Balance of the Mortgage Loans and REO Properties as of
the last day of the previous calendar month.
“ Depositor ”: ACE
Securities Corp., a Delaware corporation, or its successor in
interest.
“ Depository ”: The
[_________________], or any successor Depository hereafter named.
The nominee of the initial Depository, for purposes of registering
those Certificates that are to be Book-Entry Certificates, is
[_________________]. The Depository shall at all times be a
“clearing corporation” as defined in Section 8-102(3)
of the Uniform Commercial Code of the State of New York and a
“clearing agency” registered pursuant to the provisions
of Section 17A of the Exchange Act.
“ Depository Institution
”: Any depository institution or trust company, including the
Trustee, that (a) is incorporated under the laws of the United
States of America or any State thereof, (b) is subject to
supervision and examination by federal or state banking authorities
and (c) has outstanding unsecured commercial paper or other
short-term unsecured debt obligations (or, in the case of a
depository institution that is the principal subsidiary of a
holding company, such holding company has unsecured commercial
paper or other short-term unsecured debt obligations) that are
rated at least [A-1+] by S&P, [F-1+] by Fitch and [P-1] by
Moody’s (or, if such Rating Agencies are no longer rating the
Offered Certificates, comparable ratings by any other nationally
recognized statistical rating agency then rating the Offered
Certificates).
“ 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
”: With respect to each Distribution Date and (i) the
Servicer, the [15 th ] day of the calendar month in
which such Distribution Date occurs, or if such [15 th ]
day is not a Business Day, the Business Day immediately preceding
such [15 th ] day, and (ii) the Interim Servicer, as set
forth in the Interim Servicing Agreement. The Determination
Date for purposes of Article [__] hereof shall mean the [15
th ] day of the month, or if such [15 th ]
day is not a Business Day, the first Business Day following such
[15 th ] day.
“ Directly Operate ”:
With respect to any REO Property, the furnishing or rendering of
services to the tenants thereof, the management or operation of
such REO Property, the holding of such REO Property primarily for
sale to customers, the performance of any construction work thereon
or any use of such REO Property in a trade or business conducted by
REMIC I other than through an Independent Contractor; provided,
however, that the Servicer, on behalf of the Trustee, shall not be
considered to Directly Operate an REO Property solely because the
Servicer establishes rental terms, chooses tenants, enters into or
renews leases, deals with taxes and insurance, or makes decisions
as to repairs or capital expenditures with respect to such REO
Property.
“ Disqualified Organization
”: Any of the following: (i) the United States, any State or
political subdivision thereof, any possession of the United States,
or any agency or instrumentality of any of the foregoing (other
than an instrumentality which is a corporation if all of its
activities are subject to tax and, except for [Freddie Mac], a
majority of its board of directors is not selected by such
governmental unit), (ii) any foreign government, any international
organization, or any agency or instrumentality of any of the
foregoing, (iii) any organization (other than certain
farmers’ cooperatives described in Section 521 of the Code)
which is exempt from the tax imposed by Chapter 1 of the Code
(including the tax imposed by Section 511 of the Code on unrelated
business taxable income), (iv) rural electric and telephone
cooperatives described in Section 1381(a)(2)(C) of the Code, (v) an
“electing large partnership” and (vi) any other Person
so designated by the Trustee based upon an Opinion of Counsel that
the holding of an Ownership Interest in a Residual Certificate by
such Person may cause any Trust REMIC or any Person having an
Ownership Interest in any Class of Certificates (other than such
Person) to incur a liability for any federal tax imposed under the
Code that would not otherwise be imposed but for the Transfer of an
Ownership Interest in a Residual Certificate to such Person. The
terms “United States,” “State” and
“international organization” shall have the meanings
set forth in Section 7701 of the Code or successor
provisions.
“ Distribution Account
”: The trust account or accounts created and maintained by
the Securities Administrator pursuant to Section 3.08(b) in the
name of the Securities Administrator for the benefit of the
Certificateholders and designated
“[_________________]”. Funds in the Distribution
Account shall be held in trust for the Certificateholders for the
uses and purposes set forth in this Agreement. The Distribution
Account must be an Eligible Account.
“ Distribution Date ”:
The [25 th ] day of any month, or if such [25
th ] day is not a Business Day, the Business Day
immediately following such [25 th ] day, commencing in
[_____________], 200[__].
“ Distribution Date
Statement ”: The statement delivered to the
Certificateholders pursuant to Section 5.02.
“ Due Date ”: With
respect to each Distribution Date, the day of the month on which
the Monthly Payment is due on a Mortgage Loan during the related
Due Period, exclusive of any days of grace.
“ Due Period ”: With
respect to the Servicer and any Distribution Date, the period
commencing on the [second] day of the month immediately preceding
the month in which such Distribution Date occurs and ending on the
[first] day of the month in which such Distribution Date occurs.
With respect to any Distribution Date and the Interim
Servicer, the period as set forth in the Interim Servicing
Agreement.
“ Eligible Account ”:
Any of (i) an account or accounts maintained with a Depository
Institution, (ii) an account or accounts the deposits in which are
fully insured by the FDIC or (iii) a trust account or accounts
maintained with a federal depository institution or state chartered
depository institution acting in its fiduciary capacity. Eligible
Accounts may bear interest.
“ ERISA ”: The
Employee Retirement Income Security Act of 1974, as amended from
time to time.
“ Estate in Real Property
”: A fee simple estate in a parcel of land.
“ Excess Liquidation
Proceeds ”: To the extent that such amount is not
required by law to be paid to the related mortgagor, the amount, if
any, by which Liquidation Proceeds with respect to a liquidated
Mortgage Loan exceed the sum of (i) the outstanding principal
balance of such Mortgage Loan and accrued but unpaid interest at
the related Net Mortgage Rate through the last day of the month in
which the related Liquidation Event occurs, plus (ii) related
liquidation expenses or other amounts to which the Servicer or the
Interim Servicer is entitled to be reimbursed from Liquidation
Proceeds with respect to such liquidated Mortgage Loan pursuant to
Section 3.09 of this Agreement or pursuant to the Interim Servicing
Agreement.
“ Exchange Act ”:
The Securities Exchange Act of 1934, as amended.
“ Extraordinary Trust Fund
Expense ”: Any amounts payable or reimbursable to the
Trustee, the Master Servicer, the Securities Administrator, the
Custodians or any director, officer, employee or agent of any such
Person from the Trust Fund pursuant to the terms of this Agreement
and any amounts payable from the Distribution Account in respect of
taxes pursuant to Section 11.01(g)(v).
“ Extra Principal Distribution
Amount ”: With respect to any Distribution Date, the
lesser of (i) the Net Monthly Excess Cashflow for such Distribution
Date and (ii) the Overcollateralization Increase Amount for such
Distribution Date.
“ Fannie Mae ”: Fannie
Mae, formerly known as the Federal National Mortgage Association,
or any successor thereto.
“ FDIC ”: Federal
Deposit Insurance Corporation or any successor thereto.
“Final
Certification” :
With respect to each Custodian, the certification required to
be delivered by the Custodian to the Depositor, the Trustee and the
Servicer in the form annexed hereto as Exhibit [C-2] pursuant to
Section 2.03 of this Agreement.
“ Final Maturity Date
”: The Distribution Date occurring in [_____________],
200[__].
“ Final Recovery
Determination ”: With respect to any defaulted Mortgage
Loan or any REO Property (other than a Mortgage Loan or REO
Property purchased by an Originator, the Seller or the Master
Servicer pursuant to or as contemplated by Section 2.03, 3.13(c) or
Section 10.01), a determination made by the Servicer or the Interim
Servicer that all Insurance Proceeds, Liquidation Proceeds and
other payments or recoveries which the Servicer or the Interim
Servicer, in its reasonable good faith judgment, expects to be
finally recoverable in respect thereof have been so recovered,
which determination shall be evidenced by a certificate of a
Servicing Officer delivered to the Master Servicer and maintained
in its records.
“ Fitch ”: Fitch
Ratings or any successor in interest.
“ Form 8-K Disclosure
Information ”: As defined in Section
5.06(c)(i).
“ Freddie Mac ”:
Freddie Mac, formerly known as the Federal Home Loan Mortgage
Corporation, or any successor thereto.
“ [____________] Assignment Agreement
”: The Assignment, Assumption and Recognition Agreement,
dated as of [_____________], 200[__], by and among the Seller, the
Depositor and the Interim Servicer evidencing the assignment of the
Interim Servicing Agreement to the Depositor.
“[____________] Mortgage
Loans ”: The Mortgage Loans being serviced by the
Interim Servicer as of the Closing Date.
“ Gross Margin ”: With
respect to each Adjustable Rate Mortgage Loan, the fixed percentage
set forth in the related Mortgage Note that is added to the Index
on each Adjustment Date in accordance with the terms of the related
Mortgage Note used to determine the Mortgage Rate for such
Adjustable Rate Mortgage Loan.
“ Group I Allocation
Percentage ”: The aggregate principal balance of the
Group I Mortgage Loans divided by the sum of the aggregate
principal balance of the Group I Mortgage Loans and the Group II
Mortgage Loans.
“ Group I Interest Remittance
Amount ”: With respect to any Distribution Date is that
portion of the Available Distribution Amount for such Distribution
Date that represents interest received or advanced on the Group I
Mortgage Loans (net of the Administration Fees and any Prepayment
Charges and after taking into account amounts payable or
reimbursable to the Trustee, the Custodians, the Securities
Administrator, the Master Servicer or the Servicer pursuant to this
Agreement or the Custodial Agreements or the Interim Servicer
pursuant to the Interim Servicing Agreement).
“ Group I Mortgage Loans
”: Those Mortgage Loans identified on the Mortgage Loan
Schedule as Group I Mortgage Loans.
“ Group I Principal Distribution
Amount ”: With respect to any Distribution Date will be
the sum of (i) the principal portion of all Monthly Payments on the
Group I Mortgage Loans due during the related Due Period, whether
or not received on or prior to the related Determination Date; (ii)
the principal portion of all proceeds received in respect of the
repurchase of a Group I Mortgage Loan or, in the case of a
substitution, certain amounts representing a principal adjustment,
during the related Prepayment Period pursuant to or as contemplated
by Section 2.03, Section 3.13(c) and Section 10.01 of this
Agreement or pursuant to the Interim Servicing Agreement; (iii) the
principal portion of all other unscheduled collections, including
Insurance Proceeds, Liquidation Proceeds and all Principal
Prepayments in full and in part, received during the related
Prepayment Period, to the extent applied as recoveries of principal
on the Group I Mortgage Loans, net in each case of payments or
reimbursements to the Trustee, the Custodians, the Master Servicer,
the Securities Administrator, the Servicer or the Interim Servicer
and (iv) the Class [__] Allocation Percentage of the amount of any
Overcollateralization Increase Amount for such Distribution Date
minus (v) the Class [__] Allocation Percentage of the amount
of any Overcollateralization Reduction Amount for such Distribution
Date.
“ Group I Principal Remittance
Amount ”: With respect to any Distribution Date will be
the sum of the amounts described in clauses (i) through (iii) of
the definition of Group I Principal Distribution
Amount.
“ Group II Allocation
Percentage ” : The aggregate principal balance of
the Group II Mortgage Loans divided by the sum of the aggregate
principal balance of the Group I Mortgage Loans and the Group II
Mortgage Loans.
“ Group II Interest Remittance
Amount ”: With respect to any Distribution Date is that
portion of the Available Distribution Amount for such Distribution
Date that represents interest received or advanced on the Group II
Mortgage Loans (net of the Administration Fees and any Prepayment
Charges and after taking into account amounts payable or
reimbursable to the Trustee, the Custodians, the Securities
Administrator, the Master Servicer or the Servicer pursuant to this
Agreement or the Custodial Agreements or payable or reimbursable to
the Interim Servicer pursuant to the Interim Servicing
Agreement).
“ Group II Mortgage Loans
”: Those Mortgage Loans identified on the Mortgage Loan
Schedule as Group II Mortgage Loans.
“ Group II Principal
Distribution Amount ”: With respect to any Distribution
Date will be the sum of (i) the principal portion of all Monthly
Payments on the Group II Mortgage Loans due during the related Due
Period, whether or not received on or prior to the related
Determination Date; (ii) the principal portion of all proceeds
received in respect of the repurchase of a Group II Mortgage Loan
or, in the case of a substitution, certain amounts representing a
principal adjustment, during the related Prepayment Period pursuant
to or as contemplated by Section 2.03, Section 3.13(c) and Section
10.01 of this Agreement or pursuant to the Interim Servicing
Agreement; (iii) the principal portion of all other unscheduled
collections, including Insurance Proceeds, Liquidation Proceeds and
all Principal Prepayments in full and in part, received during the
related Prepayment Period, to the extent applied as recoveries of
principal on the Group II Mortgage Loans, net in each case of
payments or reimbursements to the Trustee, the Custodians, the
Master Servicer, the Securities Administrator, the Servicer or the
Interim Servicer and (iv) the Class [__] Allocation Percentage of
the amount of any Overcollateralization Increase Amount for such
Distribution Date minus (v) the Class [__] Allocation
Percentage of the amount of any Overcollateralization Reduction
Amount for such Distribution Date.
“ Group II Principal Remittance
Amount ”: With respect to any Distribution Date will be
the sum of the amounts described in clauses (i) through (iii) of
the definition of Group II Principal Distribution
Amount.
“ Independent ”: When
used with respect to any specified Person, any such Person who (a)
is in fact independent of the Depositor, the Master Servicer, the
Securities Administrator, the Servicer, the Seller, any Originator
and their respective Affiliates, (b) does not have any direct
financial interest in or any material indirect financial interest
in the Depositor, the Master Servicer, the Securities
Administrator, the Servicer, the Seller, any Originator or any
Affiliate thereof, and (c) is not connected with the Depositor, the
Master Servicer, the Securities Administrator, the Servicer, the
Seller, any Originator or any Affiliate thereof as an officer,
employee, promoter, underwriter, trustee, partner, director or
Person performing similar functions; provided, however, that a
Person shall not fail to be Independent of the Depositor, the
Master Servicer, the Securities Administrator, the Servicer, the
Seller, any Originator or any Affiliate thereof merely because such
Person is the beneficial owner of [1%] or less of any class of
securities issued by the Depositor, the Master Servicer, the
Securities Administrator, the Servicer, the Seller, any Originator
or any Affiliate thereof, as the case may be.
“ Independent Contractor
”: Either (i) any Person (other than the Servicer) that
would be an “independent contractor” with respect to
REMIC I within the meaning of Section 856(d)(3) of the Code if
REMIC I were a real estate investment trust (except that the
ownership tests set forth in that section shall be considered to be
met by any Person that owns, directly or indirectly, [__]% or more
of any Class of Certificates), so long as REMIC I does not receive
or derive any income from such Person and provided that the
relationship between such Person and REMIC I is at arm’s
length, all within the meaning of Treasury Regulation Section
1.856-4(b)(5), or (ii) any other Person (including the Servicer) if
the Trustee has received an Opinion of Counsel to the effect that
the taking of any action in respect of any REO Property by such
Person, subject to any conditions therein specified, that is
otherwise herein contemplated to be taken by an Independent
Contractor will not cause such REO Property to cease to qualify as
“foreclosure property” within the meaning of Section
860G(a)(8) of the Code (determined without regard to the exception
applicable for purposes of Section 860D(a) of the Code), or cause
any income realized in respect of such REO Property to fail to
qualify as Rents from Real Property.
“ Index ”: As of any
Adjustment Date, the index applicable to the determination of the
Mortgage Rate on each Adjustable Rate Mortgage Loan will generally
be the average of the interbank offered rates for [six-month]
United States dollar deposits in the London market as published in
The Wall Street Journal and as most recently available
either (a) as of the [first] Business Day [45] days prior to such
Adjustment Date or (b) as of the first Business Day of the month
preceding the month of such Adjustment Date, as specified in the
related Mortgage Note.
“ Initial Certification
”: With respect to each Custodian, the certification
required to be executed by the Custodian and delivered to the
Depositor and the Trustee in the form annexed hereto as Exhibit
[C-1] pursuant to Section 2.03 of this Agreement.
“ Institutional Accredited
Investor ”: As defined in Section 6.01(c).
“ Insurance Proceeds
”: Proceeds of any title policy, hazard policy or other
insurance policy, covering a Mortgage Loan or the related Mortgaged
Property, to the extent such proceeds are not to be applied to the
restoration of the related Mortgaged Property or released to the
Mortgagor or a senior lienholder in accordance with Accepted
Servicing Practices, subject to the terms and conditions of the
related Mortgage Note and Mortgage.
“ Interest Accrual Period
”: With respect to any Distribution Date and the Class [__]
Certificates, the [____________] Certificates and the Class [__]
Certificates, the period commencing on the Distribution Date of the
month immediately preceding the month in which such Distribution
Date occurs (or, in the case of the first Distribution Date,
commencing on the Closing Date) and ending on the day preceding
such Distribution Date. With respect to any Distribution Date and
the Class [__] Certificates and the REMIC I Regular Interests, the
one-month period ending on the last day of the calendar month
immediately preceding the month in which such Distribution Date
occurs.
“ Interest Carry Forward
Amount ”: With respect to any Distribution Date and any
Class [__] Certificate, [____________] Certificate or Class [__]
Certificate, the sum of (i) the amount, if any, by which (a) the
Interest Distribution Amount for such Class as of the immediately
preceding Distribution Date exceeded (b) the actual amount
distributed on such Class in respect of interest on such
immediately preceding Distribution Date and (ii) the amount of any
Interest Carry Forward Amount for such Class remaining unpaid from
the previous Distribution Date, plus accrued interest on such sum
calculated at the related Pass-Through Rate for the most recently
ended Interest Accrual Period.
“ Interest Determination
Date ”: With respect to the Class [__] Certificates, the
[____________] Certificates, the Class [__] Certificates, REMIC I
Regular Interests and REMIC II Regular Interests (other than REMIC
I Regular Interest [__] and REMIC II Regular Interest [__]) and any
Interest Accrual Period therefor, the second London Business Day
preceding the commencement of such Interest Accrual
Period.
“ Interest Distribution
Amount ”: With respect to any Distribution Date and any
Class [__] Certificates, any [____________] Certificates, any Class
[__] Certificates and any Class [__] Certificates, the aggregate
Accrued Certificate Interest on the Certificates of such Class for
such Distribution Date.
“ Interim Servicer ”:
[_________________], and any successor thereto.
“ Interim Servicing
Agreement ”: The Master Mortgage Loan Purchase and
Interim Servicing Agreement, dated as of [_____________], 200[__],
as amended by Amendment Number [__] dated [_____________], 200[__]
and Amendment Number [__] dated [_____________], 200[__], between
the Seller and the Interim Servicer, as modified by the
[_________________].
“ Interest Remittance Amount
”: With respect to any Distribution Date, the sum of (i) the
Group I Interest Remittance Amount and (ii) the Group II Interest
Remittance Amount.
“ ISDA Master Agreement
”: The ISDA Master Agreement dated as of [_____________],
200[__], as amended and supplemented from time to time, between the
Swap Provider and the Trustee.
“ Last Scheduled Distribution
Date ”: The Distribution Date occurring in
[_____________], 200[__], which is the Distribution Date
immediately following the maturity date for the Mortgage Loan with
the latest maturity date.
“ Late Collections ”:
With respect to any Mortgage Loan and any Due Period, all amounts
received subsequent to the Determination Date immediately following
such Due Period with respect to such Mortgage Loan, whether as late
payments of Monthly Payments or as Insurance Proceeds, Liquidation
Proceeds or otherwise, which represent late payments or collections
of principal and/or interest due (without regard to any
acceleration of payments under the related Mortgage and Mortgage
Note) but delinquent for such Due Period and not previously
recovered.
“ Liquidation Event ”:
With respect to any Mortgage Loan, any of the following events: (i)
such Mortgage Loan is paid in full; (ii) a Final Recovery
Determination is made as to such Mortgage Loan or (iii) such
Mortgage Loan is removed from REMIC I by reason of its being
purchased, sold or replaced pursuant to or as contemplated by
Section 2.03, Section 3.13(c) or Section 10.01 of this Agreement.
With respect to any REO Property, either of the following events:
(i) a Final Recovery Determination is made as to such REO Property
or (ii) such REO Property is removed from REMIC I by reason of its
being purchased pursuant to Section 10.01.
“ Liquidation Proceeds
”: The amount (other than Insurance Proceeds, amounts
received in respect of the rental of any REO Property prior to REO
Disposition, or required to be released to a Mortgagor or a senior
lienholder in accordance with applicable law or the terms of the
related Mortgage Loan Documents) received by the Servicer or the
Interim Servicer in connection with (i) the taking of all or a part
of a Mortgaged Property by exercise of the power of eminent domain
or condemnation (other than amounts required to be released to the
Mortgagor or a senior lienholder), (ii) the liquidation of a
defaulted Mortgage Loan through a trustee’s sale, foreclosure
sale or otherwise, (iii) the repurchase, substitution or sale of a
Mortgage Loan or an REO Property pursuant to or as contemplated by
Section 2.03, Section 3.13(c), Section 3.21 or Section 10.01 of
this Agreement or (iv) any Subsequent Recoveries.
“ Loan-to-Value Ratio
”: As of any date of determination, the fraction, expressed
as a percentage, the numerator of which is the principal balance of
the related Mortgage Loan at such date and the denominator of which
is the Value of the related Mortgaged Property.
“ London Business Day
”: Any day on which banks in the Cities of London and New
York are open and conducting transactions in United States
dollars.
“ Loss Severity Percentage
”: With respect to any Distribution Date, the percentage
equivalent of a fraction, the numerator of which is the amount of
Realized Losses incurred on a Mortgage Loan and the denominator of
which is the principal balance of such Mortgage Loan immediately
prior to the liquidation of such Mortgage Loan.
“ Marker Rate ”: With
respect to the Class [__] Certificates and any Distribution Date, a
per annum rate equal to [__] ([__]) times the weighted average of
the REMIC II Remittance Rate for each of REMIC II Regular Interest
[__], REMIC II Regular Interest [__], REMIC II Regular Interest
[__], with the rate on each such REMIC II Regular Interest (other
than REMIC II Regular Interest [__]) subject to a cap equal to the
lesser of (i) the related One-Month LIBOR Pass-Through Rate and
(ii) the related Net WAC Pass-Through Rate for the corresponding
Certificate for the purpose of this calculation for such
Distribution Date and with the rate on REMIC II Regular Interest
[__] subject to a cap of [
] for the purpose
of this calculation; provided however, each such cap for each REMIC
II Regular Interest shall be multiplied by a fraction the numerator
of which is the actual number of days in the related Interest
Accrual Period and the denominator of which is [__].
“ Master Servicer ”:
As of the Closing Date, [_________________] and thereafter,
its respective successors in interest who meet the qualifications
of this Agreement. The Master Servicer and the Securities
Administrator shall at all times be the same Person or an
Affiliate.
“ Master Servicer Event of
Default ”: One or more of the events described in
Section 8.01(b).
“ Master Servicing Fee
”: With respect to each Mortgage Loan and for any calendar
month, an amount equal to one-twelfth of the product of the Master
Servicing Fee multiplied by the Scheduled Principal Balance of the
Mortgage Loans as of the Due Date in the preceding calendar
month.
“ Master Servicing Fee Rate
”: [__]% per annum.
“ Maximum [__] Uncertificated
Interest Deferral Amount ”: With respect to any
Distribution Date, the excess of (i) accrued interest at the REMIC
II Remittance Rate applicable to REMIC II Regular Interest [__] for
such Distribution Date on a balance equal to the Uncertificated
Balance of REMIC II Regular Interest [__] minus the REMIC II
Overcollateralization Amount, in each case for such Distribution
Date, over (ii) Uncertificated Interest on REMIC II Regular
Interest [__] for such Distribution Date, with the rate on each
such REMIC II Regular Interest subject to a cap equal to the lesser
of (i) the related One-Month LIBOR Pass-Through Rate and (ii) the
related Net WAC Pass-Through Rate for the Corresponding Certificate
for the purpose of this calculation for such Distribution Date;
provided however, each such cap for each REMIC II Regular Interest
shall be multiplied by a fraction the numerator of which is the
actual number of days in the related Interest Accrual Period and
the denominator of which is [__].
“ Maximum Mortgage Rate
”: With respect to each Adjustable Rate Mortgage Loan, the
percentage set forth in the related Mortgage Note as the maximum
Mortgage Rate thereunder.
[“ MERS ”:
Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or
any successor thereto.]
[“ MERS® System ”:
The system of recording transfers of mortgages electronically
maintained by MERS.]
“ [ ]
Certificate ”: Any Class [__] Certificate.
[“ MIN ”: The
Mortgage Identification Number for Mortgage Loans registered with
MERS on the MERS® System.]
“ Minimum Mortgage Rate
”: With respect to each Adjustable Rate Mortgage Loan, the
percentage set forth in the related Mortgage Note as the minimum
Mortgage Rate thereunder.
“ MOM Loan ”:
With respect to any Mortgage Loan, [MERS] acting as the
mortgagee of such Mortgage Loan, solely as nominee for the
originator of such Mortgage Loan and its successors and assigns, at
the origination thereof.
“ Monthly Payment ”:
With respect to any Mortgage Loan, the scheduled monthly payment of
principal and interest on such Mortgage Loan which is payable by
the related Mortgagor from time to time under the related Mortgage
Note, determined: (a) after giving effect to (i) any Deficient
Valuation and/or Debt Service Reduction with respect to such
Mortgage Loan and (ii) any reduction in the amount of interest
collectible from the related Mortgagor pursuant to the Relief Act
or similar state laws; (b) without giving effect to any extension
granted or agreed to by the Servicer pursuant to Section 3.01 of
this Agreement or by the Interim Servicer pursuant to the Interim
Servicing Agreement; and (c) on the assumption that all other
amounts, if any, due under such Mortgage Loan are paid when
due.
“ Moody’s ”:
Moody’s Investors Service, Inc. or any successor in
interest.
“ Mortgage ”: The
mortgage, deed of trust or other instrument creating a first or
second lien on, or first or second priority security interest in, a
Mortgaged Property securing a Mortgage Note.
“ Mortgage File ”: The
Mortgage Loan Documents pertaining to a particular Mortgage
Loan.
“ Mortgage Loan ”:
Each mortgage loan transferred and assigned to the Trustee and the
Mortgage Loan Documents for which have been delivered to the
applicable Custodian pursuant to Section 2.01 of this Agreement and
pursuant to the related Custodial Agreement, as held from time to
time as a part of the Trust Fund, the Mortgage Loans so held being
identified in the Mortgage Loan Schedule.
“ Mortgage Loan Documents
”: The documents evidencing or relating to each
Mortgage Loan delivered to the applicable Custodian under the
related Custodial Agreement on behalf of the Trustee.
“ Mortgage Loan Purchase
Agreement ”: Shall mean the Mortgage Loan Purchase
Agreement dated as of [_____________], 200[__], between the
Depositor and the Seller.
“ Mortgage Loan Schedule
”: As of any date, the list of Mortgage Loans included in
REMIC I on such date, separately identifying the Group I Mortgage
Loans and the Group II Mortgage Loans, attached hereto as
Schedule 1 . The Depositor shall deliver or cause the
delivery of the initial Mortgage Loan Schedule to the Servicer, the
Master Servicer, the Custodians and the Trustee on the Closing
Date. The Mortgage Loan Schedule shall set forth the following
information with respect to each Mortgage Loan:
(i)
the Mortgage Loan identifying
number;
(ii)
the Mortgagor’s first and last
name;
(iii)
the street address of the Mortgaged
Property including the state and zip code;
(iv)
a code indicating whether the Mortgaged
Property is owner-occupied;
(v)
the type of Residential Dwelling
constituting the Mortgaged Property;
(vi)
the original months to
maturity;
(vii)
the original date of the Mortgage Loan
and the remaining months to maturity from the Cut-off Date, based
on the original amortization schedule;
(viii)
the Loan-to-Value Ratio at
origination;
(ix)
the Mortgage Rate in effect immediately
following the Cut-off Date;
(x)
the date on which the first Monthly
Payment was due on the Mortgage Loan;
(xi)
the stated maturity date;
(xii)
the amount of the Monthly Payment at
origination;
(xiii)
the amount of the Monthly Payment as of
the Cut-off Date;
(xiv)
the last Due Date on which a Monthly
Payment was actually applied to the unpaid Stated Principal
Balance;
(xv)
the original principal amount of the
Mortgage Loan;
(xvi)
the Stated Principal Balance of the
Mortgage Loan as of the close of business on the Cut-off
Date;
(xvii)
with respect to each Adjustable Rate
Mortgage Loan, the first Adjustment Date;
(xviii)
with respect to each Adjustable Rate
Mortgage Loan, the Gross Margin;
(xix)
a code indicating the purpose of the loan
(i.e., purchase financing, rate/term refinancing, cash-out
refinancing);
(xx)
with respect to each Adjustable Rate
Mortgage Loan, the Maximum Mortgage Rate under the terms of the
Mortgage Note;
(xxi)
with respect to each Adjustable Rate
Mortgage Loan, the Minimum Mortgage Rate under the terms of the
Mortgage Note;
(xxii)
the Mortgage Rate at
origination;
(xxiii)
with respect to each Adjustable Rate
Mortgage Loan, the Periodic Rate Cap;
(xxiv)
with respect to each Adjustable Rate
Mortgage Loan, the first Adjustment Date immediately following the
Cut-off Date;
(xxv)
with respect to each Adjustable Rate
Mortgage Loan, the Index;
(xxvi)
the date on which the first Monthly
Payment was due on the Mortgage Loan and, if such date is not
consistent with the Due Date currently in effect, such Due
Date;
(xxvii)
a code indicating whether the Mortgage
Loan is an Adjustable Rate Mortgage Loan or a fixed rate Mortgage
Loan;
(xxviii)
a code indicating the documentation style
(i.e., full, stated or limited);
(xxix)
a code indicating if the Mortgage Loan is
subject to a primary insurance policy or lender paid mortgage
insurance policy and the name of the insurer;
(xxx)
the Appraised Value of the Mortgaged
Property;
(xxxi)
the sale price of the Mortgaged Property,
if applicable;
(xxxii)
a code indicating whether the Mortgage
Loan is subject to a Prepayment Charge, the term of such Prepayment
Charge and the amount of such Prepayment Charge;
(xxxiii)
the product type (e.g., 2/28, 15 year
fixed, 30 year fixed, 15/30 balloon, etc.);
(xxxiv)
the Mortgagor’s debt to income
ratio;
(xxxv)
the FICO score at origination;
(xxxvi)
the Servicer or Interim Servicer, if
applicable;
(xxxvii)
the applicable Custodian; and
(xxxviii)
a code indicating whether the Mortgage
Loan is secured by a first or second lien.
The Mortgage Loan Schedule shall set
forth the following information with respect to the Mortgage Loans
in the aggregate as of the Cut-off Date: (1) the number of Mortgage
Loans; (2) the current principal balance of the Mortgage Loans; (3)
the weighted average Mortgage Rate of the Mortgage Loans; and (4)
the weighted average maturity of the Mortgage Loans. The Mortgage
Loan Schedule shall be amended from time to time by the Depositor
in accordance with the provisions of this Agreement. With respect
to any Qualified Substitute Mortgage Loan, the Cut-off Date shall
refer to the related Cut-off Date for such Mortgage Loan,
determined in accordance with the definition of Cut-off Date
herein.
“ Mortgage Note ”: The
original executed note or other evidence of the indebtedness of a
Mortgagor under a Mortgage Loan.
“ Mortgage Rate ”:
With respect to each Mortgage Loan, the annual rate at which
interest accrues on such Mortgage Loan from time to time in
accordance with the provisions of the related Mortgage Note, which
rate with respect to each Adjustable Rate Mortgage Loan (A) as of
any date of determination until the first Adjustment Date following
the Cut-off Date shall be the rate set forth in the Mortgage Loan
Schedule as the Mortgage Rate in effect immediately following the
Cut-off Date and (B) as of any date of determination thereafter
shall be the rate as adjusted on the most recent Adjustment Date
equal to the sum, rounded to the nearest [__]% as provided in the
Mortgage Note, of the Index, as most recently available as of a
date prior to the Adjustment Date as set forth in the related
Mortgage Note, plus the related Gross Margin; provided that the
Mortgage Rate on such Adjustable Rate Mortgage Loan on any
Adjustment Date shall never be more than the lesser of (i) the sum
of the Mortgage Rate in effect immediately prior to the Adjustment
Date plus the related Periodic Rate Cap, if any, and (ii) the
related Maximum Mortgage Rate, and shall never be less than the
greater of (i) the Mortgage Rate in effect immediately prior to the
Adjustment Date less the Periodic Rate Cap, if any, and (ii) the
related Minimum Mortgage Rate. With respect to each Mortgage Loan
that becomes an REO Property, as of any date of determination, the
annual rate determined in accordance with the immediately preceding
sentence as of the date such Mortgage Loan became an REO
Property.
“ Mortgaged Property
”: The underlying property securing a Mortgage Loan,
including any REO Property, consisting of an Estate in Real
Property improved by a Residential Dwelling.
“ Mortgagor ”: The
obligor on a Mortgage Note.
“ Net Monthly Excess
Cashflow ”: With respect to any Distribution Date, the
sum of (i) any Overcollateralization Reduction Amount for such
Distribution Date and (ii) the excess of (x) the Available
Distribution Amount for such Distribution Date over (y) the sum for
such Distribution Date of (A) the aggregate Senior Interest
Distribution Amounts payable to the Holders of the Class [____]
Certificates, (B) the aggregate Interest Distribution Amounts
payable to the holders of the [ ]
Certificates and the Class [____] Certificates and (C) the
Principal Remittance Amount.
“ Net Mortgage Rate ”:
With respect to any Mortgage Loan (or the related REO Property) as
of any date of determination, a per annum rate of interest equal to
the then applicable Mortgage Rate for such Mortgage Loan minus the
Administration Fee Rate.
“ Net Swap Payment ”:
With respect to each Distribution Date, the net payment
required to be made pursuant to the terms of the Swap Agreement by
either the Swap Provider or the Supplemental Interest Trust, which
net payment shall not take into account any Swap Termination
Payment.
“ Net WAC Pass-Through Rate
”: With respect to the Class [__] Certificates and any
Distribution Date, a rate per annum (adjusted for the actual number
of days elapsed in the related Interest Accrual Period) equal to a
fraction, expressed as a percentage, the numerator of which is the
amount of interest which accrued on the Group I Mortgage Loans in
the prior calendar month minus the fees payable to the Servicer,
the Master Servicer and the Credit Risk Manager with respect to the
Group I Mortgage Loans for such Distribution Date and the Group I
Allocation Percentage of any Net Swap Payment payable to the Swap
Provider or Swap Termination Payment payable to the Swap Provider
which was not caused by the occurrence of a Swap Provider Trigger
Event, in each case for such Distribution Date and the denominator
of which is the aggregate principal balance of the Group I Mortgage
Loans as of the last day of the immediately preceding Due Period
(or as of the Cut-off Date with respect to the first Distribution
Date), after giving effect to Principal Prepayments received during
the related Prepayment Period. For federal income tax
purposes, the economic equivalent of such rate shall be expressed
as the weighted average of (adjusted for the actual number of days
elapsed in the related Interest Accrual Period) the REMIC II
Remittance Rate on REMIC II Regular Interest [____], weighted on
the basis of the Uncertificated Balance of such REMIC II Regular
Interest.
With respect to the Class [__]
Certificates and any Distribution Date, a rate per annum (adjusted
for the actual number of days elapsed in the related Interest
Accrual Period) equal to a fraction, expressed as a percentage, the
numerator of which is the amount of interest which accrued on the
Group II Mortgage Loans in the prior calendar month minus the fees
payable to the Servicer, the Master Servicer and the Credit Risk
Manager with respect to the Group II Mortgage Loans for such
Distribution Date and the Group II Allocation Percentage of any Net
Swap Payment payable to the Swap Provider or Swap Termination
Payment payable to the Swap Provider which was not caused by the
occurrence of a Swap Provider Trigger Event, in each case for such
Distribution Date and the denominator of which is the aggregate
principal balance of the Group II Mortgage Loans as of the last day
of the immediately preceding Due Period (or as of the Cut-off Date
with respect to the first Distribution Date), after giving effect
to Principal Prepayments received during the related Prepayment
Period. For federal income tax purposes, the economic
equivalent of such rate shall be expressed as the weighted average
of (adjusted for the actual number of days elapsed in the related
Interest Accrual Period) the REMIC II Remittance Rate on REMIC II
Regular Interest I[____], weighted on the basis of the
Uncertificated Balance of such REMIC II Regular
Interest.
“ Net WAC
Rate Carryover Amount ”: With respect to any Class [__]
Certificate, [ ] Certificate or Class
[__] Certificate and any Distribution Date on which the
Pass-Through Rate is limited to the applicable Net WAC Pass-Through
Rate, an amount equal to the sum of (i) the excess of (x) the
amount of interest such Class would have been entitled to receive
on such Distribution Date if the applicable Net WAC Pass-Through
Rate would not have been applicable to such Class on such
Distribution Date over (y) the amount of interest paid to such
Class on such Distribution Date at the applicable Net WAC
Pass-Through Rate plus (ii) the related Net WAC Rate Carryover
Amount for the previous Distribution Date not previously
distributed to such Class together with interest thereon at a rate
equal to the Pass-Through Rate for such Class for the most recently
ended Interest Accrual Period without taking into account the
applicable Net WAC Pass-Through Rate.
“ New Lease ”: Any
lease of REO Property entered into on behalf of REMIC I, including
any lease renewed or extended on behalf of REMIC I, if REMIC I has
the right to renegotiate the terms of such lease.
“ Nonrecoverable P&I
Advance ”: Any P&I Advance previously made or
proposed to be made in respect of a Mortgage Loan or REO Property
that, in the good faith business judgment of the Servicer, the
Interim Servicer or a successor to the Servicer or the Interim
Servicer (including the Master Servicer) will not or, in the case
of a proposed P&I Advance, would not be ultimately recoverable
from related Late Collections, Insurance Proceeds or Liquidation
Proceeds on such Mortgage Loan or REO Property as provided
herein.
“ Nonrecoverable Servicing
Advance ”: Any Servicing Advance previously made or
proposed to be made in respect of a Mortgage Loan or REO Property
that, in the good faith business judgment of the Servicer, the
Interim Servicer or a successor to the Servicer or the Interim
Servicer (including the Master Servicer) will not or, in the case
of a proposed Servicing Advance, would not be ultimately
recoverable from related Late Collections, Insurance Proceeds or
Liquidation Proceeds on such Mortgage Loan or REO Property as
provided herein or in the Interim Servicing Agreement.
“ Non-United States Person
”: Any Person other than a United States Person.
“ Notional Amount ”:
With respect to the Class [____] Certificates and any Distribution
Date, the Uncertificated Balance of the REMIC II Regular Interests
(other than REMIC II Regular Interest P) for such Distribution
Date. As of the Closing Date, the Notional Amount of the
Class [____] Certificates is equal to $[____________].
[“ [
] ”: [
] Loan Servicing,
LLC or any successor thereto.]
“ Offered Certificates
”: The Class [__] Certificates and the [
] Certificates, collectively.
“ Officer’s
Certificate ”: With respect to any Person, a certificate
signed by the Chairman of the Board, the Vice Chairman of the
Board, the President or a vice president (however denominated), or
by the Treasurer, the Secretary, or one of the assistant treasurers
or assistant secretaries of such Person (or, in the case of a
Person that is not a corporation, signed by the person or persons
having like responsibilities).
“ One-Month LIBOR ”:
With respect to the Class [__] Certificates, the [
] Certificates, the Class [__]
Certificates, REMIC II Regular Interests (other than REMIC II
Regular Interest [__]) and any Interest Accrual Period therefor,
the rate determined by the Securities Administrator on the related
Interest Determination Date on the basis of the offered rate for
one-month U.S. dollar deposits, as such rate appears on Telerate
Page 3750 as of 11:00 a.m. (London time) on such Interest
Determination Date; provided that if such rate does not appear on
Telerate Page 3750, the rate for such date will be determined on
the basis of the offered rates of the Reference Banks for one-month
U.S. dollar deposits, as of 11:00 a.m. (London time) on such
Interest Determination Date. In such event, the Securities
Administrator will request the principal London office of each of
the Reference Banks to provide a quotation of its rate. If on such
Interest Determination Date, two or more Reference Banks provide
such offered quotations, One-Month LIBOR for the related Interest
Accrual Period shall be the arithmetic mean of such offered
quotations (rounded upwards if necessary to the nearest whole
multiple of [1/16]). If on such Interest Determination Date, fewer
than two Reference Banks provide such offered quotations, One-Month
LIBOR for the related Interest Accrual Period shall be the higher
of (i) LIBOR as determined on the previous Interest Determination
Date and (ii) the Reserve Interest Rate. Notwithstanding the
foregoing, if, under the priorities described above, LIBOR for an
Interest Determination Date would be based on LIBOR for the
previous Interest Determination Date for the third consecutive
Interest Determination Date, the Securities Administrator shall
select an alternative comparable index (over which the Securities
Administrator has no control), used for determining one-month
Eurodollar lending rates that is calculated and published (or
otherwise made available) by an independent party. The
establishment of One-Month LIBOR by the Securities Administrator
and the Securities Administrator’s subsequent calculation of
the One-Month LIBOR Pass-Through Rates for the relevant Interest
Accrual Period, shall, in the absence of manifest error, be final
and binding.
“ One-Month LIBOR Pass-Through
Rate ”: With respect to the Class [__] Certificates and,
for purposes of the definition of “Marker Rate”, REMIC
II Regular Interest [__], a per annum rate equal to One-Month LIBOR
plus the related Certificate Margin.
With respect to the Class [__]
Certificates and, for purposes of the definition of “Marker
Rate”, REMIC II Regular Interest [__], a per annum rate equal
to One-Month LIBOR plus the related Certificate Margin.
“ Opinion of Counsel
”: A written opinion of counsel, who may, without limitation,
be salaried counsel for the Depositor, the Servicer, the Securities
Administrator or the Master Servicer, acceptable to the Trustee,
except that any opinion of counsel relating to (a) the
qualification of any REMIC as a REMIC or (b) compliance with the
REMIC Provisions must be an opinion of Independent
counsel.
“ Optional Termination Date
”: The Distribution Date on which the aggregate principal
balance of the Mortgage Loans (and properties acquired in respect
thereof) remaining in the Trust Fund is reduced to less than
or equal to [__]% of the aggregate principal balance of the
Mortgage Loans as of the Cut-off Date.
“ Originators ”:
The Interim Servicer and various other originators (each, an
“Originator”).
“ Overcollateralization
Amount ”: With respect to any Distribution Date, the
excess, if any, of (a) the aggregate Stated Principal Balances of
the Mortgage Loans and REO Properties immediately following such
Distribution Date over (b) the sum of the aggregate Certificate
Principal Balances of the Class [__] Certificates and the Class
[__] Certificates as of such Distribution Date (after taking into
account the payment of the Principal Remittance Amount on such
Distribution Date).
“ Overcollateralization Increase
Amount ”: With respect to any Distribution Date,
the amount of Net Monthly Excess Cashflow actually applied as an
accelerated payment of principal to the Class [__] Certificates and
the Class [__] Certificates then entitled to distributions of
principal to the extent the Required Overcollateralization Amount
exceeds the Overcollateralization Amount.
“ Overcollateralization
Reduction Amount ”: With respect to any Distribution
Date, the lesser of (i) the amount by which the
Overcollateralization Amount exceeds the Required
Overcollateralization Amount and (ii) the Principal Remittance
Amount; provided however that on any Distribution Date on which a
Trigger Event is in effect, the Overcollateralization Reduction
Amount shall equal [
].
“ 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.
“ P&I Advance ”:
As to any Mortgage Loan or REO Property, any advance made by the
Servicer in respect of any Determination Date pursuant to Section
5.03 of this Agreement, an Advance Financing Person pursuant to
Section 3.25 of this Agreement or in respect of any Distribution
Date by a successor servicer (including the Master Servicer)
pursuant to Section 8.02 of this Agreement, or the Interim Servicer
pursuant to the Interim Servicing Agreement (which advances shall
not include principal or interest shortfalls due to bankruptcy
proceedings or application of the Relief Act or similar state or
local laws.)
“ Pass-Through Rate ”:
With respect to the Class [__] Certificates and the Class [__]
Certificates, and any Distribution Date, a rate per annum equal to
the lesser of (i) the related One-Month LIBOR Pass-Through Rate for
such Distribution Date and (ii) the related Net WAC Pass-Through
Rate for such Distribution Date.
With respect to the Class [__]
Certificates and any Distribution Date, a rate per annum equal to
the percentage equivalent of a fraction, the numerator of which is
the sum of the amounts calculated pursuant to clauses (i) and (ii)
below, and the denominator of which is the aggregate Uncertificated
Balances of REMIC II Regular Interest [__]. For purposes of
calculating the Pass-Through Rate for the Class [__] Certificates,
the numerator is equal to the sum of the following
components:
(i) the REMIC II Remittance Rate for
REMIC II Regular Interest [__] minus the Marker Rate, applied to an
amount equal to the Uncertificated Balance of REMIC II Regular
Interest [__]; and
(ii) [__]% of the interest on REMIC II
Regular Interest [__].
“PCAOB”
: The Public Company Accounting
Oversight Board.
“ Percentage Interest
”: With respect to any Class of Certificates (other
than the Residual Certificates), the undivided percentage ownership
in such Class evidenced by such Certificate, expressed as a
percentage, the numerator of which is the initial Certificate
Principal Balance represented by such Certificate and the
denominator of which is the aggregate initial Certificate Principal
Balance or Notional Amount of all of the Certificates of such
Class. The Class [__] Certificates and the Class [__] Certificates
are issuable only in minimum Percentage Interests corresponding to
minimum initial Certificate Principal Balances of $[_______] and
integral multiples of $[__] in excess thereof; provided, however,
that a single Certificate of each such Class of Certificates may be
issued having a Percentage Interest corresponding to the remainder
of the aggregate initial Notional Balance of such Class or to an
otherwise authorized denomination for such Class plus such
remainder. With respect to any Residual Certificate, the undivided
percentage ownership in such Class evidenced by such Certificate,
as set forth on the face of such Certificate. The Residual
Certificates are issuable in Percentage Interests of [__]% and
integral multiples of [__]% in excess thereof.
“ Periodic Rate Cap ”:
With respect to each Adjustable Rate Mortgage Loan and any
Adjustment Date therefor, the fixed percentage set forth in the
related Mortgage Note, which is the maximum amount by which the
Mortgage Rate for such Adjustable Rate Mortgage Loan may increase
or decrease (without regard to the Maximum Mortgage Rate or the
Minimum Mortgage Rate) on such Adjustment Date from the Mortgage
Rate in effect immediately prior to such Adjustment
Date.
“ Permitted Investments
”: Any one or more of the following obligations or securities
acquired at a purchase price of not greater than par, regardless of
whether issued by the Depositor, the Servicer, the Master Servicer,
the Trustee or any of their respective Affiliates:
(i)
direct obligations of, or obligations
fully guaranteed as to timely payment of principal and interest by,
the United States or any agency or instrumentality thereof,
provided such obligations are backed by the full faith and credit
of the United States;
(ii)
(A) demand and time deposits in,
certificates of deposit of, bankers’ acceptances issued by or
federal funds sold by any depository institution or trust company
(including the Trustee or its agent acting in their respective
commercial capacities) incorporated under the laws of the United
States of America or any state thereof and subject to supervision
and examination by federal and/or state authorities, so long as, at
the time of such investment or contractual commitment providing for
such investment, such depository institution or trust company (or,
if the only Rating Agency is S&P, in the case of the principal
depository institution in a depository institution holding company,
debt obligations of the depository institution holding company) or
its ultimate parent has a short-term uninsured debt rating in the
highest available rating category of Moody’s, Fitch and
S&P and provided that each such investment has an original
maturity of no more than 365 days; and provided further that, if
the only Rating Agency is S&P and if the depository or trust
company is a principal subsidiary of a bank holding company and the
debt obligations of such subsidiary are not separately rated, the
applicable rating shall be that of the bank holding company; and,
provided further that, if the original maturity of such short-term
obligations of a domestic branch of a foreign depository
institution or trust company shall exceed [__] days, the short-term
rating of such institution shall be [A-1+] in the case of S&P
if S&P is the Rating Agency; and (B) any other demand or time
deposit or deposit which is fully insured by the FDIC;
(iii)
repurchase obligations with a term not to
exceed [__] days with respect to any security described in clause
(i) above and entered into with a depository institution or trust
company (acting as principal) rated [A-1+] or higher by S&P,
[F-1] or higher by Fitch and [A2] or higher by Moody’s,
provided, however, that collateral transferred pursuant to such
repurchase obligation must be of the type described in clause (i)
above and must (A) be valued daily at current market prices plus
accrued interest, (B) pursuant to such valuation, be equal, at all
times, to [__]% of the cash transferred by a party in exchange for
such collateral and (C) be delivered to such party or, if such
party is supplying the collateral, an agent for such party, in such
a manner as to accomplish perfection of a security interest in the
collateral by possession of certificated securities;
(iv)
securities bearing interest or sold at a
discount that are issued by any corporation incorporated under the
laws of the United States of America or any state thereof and that
are rated by each Rating Agency that rates such securities in its
highest long-term unsecured rating categories at the time of such
investment or contractual commitment providing for such
investment;
(v)
commercial paper (including both
non-interest-bearing discount obligations and interest-bearing
obligations payable on demand or on a specified date not more than
30 days after the date of acquisition thereof) that is rated by
each Rating Agency that rates such securities in its highest
short-term unsecured debt rating available at the time of such
investment;
(vi)
units of money market funds that have
been rated [“AAA”] by Fitch (if rated by Fitch),
[“AAA”] by S&P or [“Aaa”] by
Moody’s including any such money market fund managed or
advised by the Master Servicer, the Trustee or any of their
Affiliates; and
(vii)
if previously confirmed in writing to the
Trustee, any other demand, money market or time deposit, or any
other obligation, security or investment, as may be acceptable to
the Rating Agencies as a permitted investment of funds backing
securities having ratings equivalent to its highest initial rating
of the Class [__] Certificates;
provided, however, that no instrument
described hereunder shall evidence either the right to receive (a)
only interest with respect to the obligations underlying such
instrument or (b) both principal and interest payments derived from
obligations underlying such instrument and the interest and
principal payments with respect to such instrument provide a yield
to maturity at par greater than [__]% of the yield to maturity at
par of the underlying obligations.
“ Permitted Transferee
”: Any Transferee of a Residual Certificate other than a
Disqualified Organization or Non-United States Person.
“ Person ”: Any
individual, limited liability company, corporation, partnership,
joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or
political subdivision thereof.
“ Plan ”: Any employee
benefit plan or certain other retirement plans and arrangements,
including individual retirement accounts and annuities, Keogh plans
and bank collective investment funds and insurance company general
or separate accounts in which such plans, accounts or arrangements
are invested, that are subject to ERISA or Section 4975 of the
Code.
“ Prepayment Assumption
”: A prepayment rate for (a) the Adjustable Rate Mortgage
Loans of [__]% PPC, which represents (i) a per annum prepayment
rate of [__]% of the then outstanding principal balance of the
Adjustable Rate Mortgage Loans in the first month of the life of
the Adjustable Rate Mortgage Loans, (ii) an additional [__]% per
annum in each month thereafter through the [__] month, (iii)
building to a constant prepayment rate of [__]% per annum beginning
in the [__] month and remaining constant until the [__] month, (iv)
increasing to and remaining constant at a prepayment rate of [__]%
per annum beginning in the [____________] month until the
[____________] month and (v) decreasing and remaining constant at a
prepayment rate of [ ]% per annum from the [__] month
and thereafter; provided, however, the prepayment rate will not
exceed [__]% per annum in any period for any percentage of PPC; and
(b) the fixed-rate Mortgage Loans of [__]% PPC, which represents
(i) a per annum prepayment rate of [__]% of the then outstanding
principal balance of the fixed rate Mortgage Loans in the [__]
month of the life of such Mortgage Loans, (ii) an additional [__]%
per annum in each month thereafter through the [__] month and (iii)
a constant prepayment rate of [__]% per annum beginning in the [__]
month and in each month thereafter during the life of the fixed
rate Mortgage Loans. The Prepayment Assumption is used solely
for determining the accrual of original issue discount on the
Certificates for federal income tax purposes.
“ Prepayment Charge ”:
With respect to any Principal Prepayment, any prepayment premium,
penalty or charge payable by a Mortgagor in connection with any
Principal Prepayment on a Mortgage Loan pursuant to the terms of
the related Mortgage Note.
“ Prepayment Charge Schedule
”: As of any date, the list of Mortgage Loans providing
for a Prepayment Charge included in the Trust Fund on such date,
attached hereto as Schedule 2 (including the prepayment charge
summary attached thereto). The Depositor shall deliver or
cause the delivery of the Prepayment Charge Schedule to the
Servicer, the Master Servicer and the Trustee on the Closing Date.
The Prepayment Charge Schedule shall set forth the following
information with respect to each Prepayment Charge:
(i)
the Mortgage Loan identifying
number;
(ii)
a code indicating the type of Prepayment
Charge;
(iii)
the date on which the first Monthly
Payment was due on the related Mortgage Loan;
(iv)
the term of the related Prepayment
Charge;
(v)
the original Stated Principal Balance of
the related Mortgage Loan; and
(vi)
the Stated Principal Balance of the
related Mortgage Loan as of the Cut-off Date.
“ Prepayment Interest Excess
”: With respect to each Mortgage Loan that was the subject of
a Principal Prepayment in full during the portion of the related
Prepayment Period occurring between the first day of the calendar
month in which such Distribution Date occurs and the Determination
Date of the calendar month in which such Distribution Date occurs,
an amount equal to interest (to the extent received) at the
applicable Net Mortgage Rate on the amount of such Principal
Prepayment for the number of days commencing on the first day of
the calendar month in which such Distribution Date occurs and
ending on the last date through which interest is collected from
the related Mortgagor. The Servicer may withdraw such
Prepayment Interest Excess from the Collection Account in
accordance with Section 3.09(a)(x).
“ Prepayment Interest
Shortfall ”: With respect to any Distribution Date, for
each such Mortgage Loan that was the subject of a Principal
Prepayment in full or in part during the portion of the related
Prepayment Period occurring between the first day of the related
Prepayment Period and the last day of the calendar month preceding
the month in which such Distribution Date occurs that was applied
by the Servicer or the Interim Servicer to reduce the outstanding
principal balance of such Mortgage Loan on a date preceding the Due
Date in the succeeding Prepayment Period, an amount equal to
interest at the applicable Net Mortgage Rate on the amount of such
Principal Prepayment for the number of days commencing on the date
on which the prepayment is applied and ending on the last day of
the calendar month preceding such Distribution Date. The
obligations of the Servicer and the Master Servicer in respect of
any Prepayment Interest Shortfall are set forth in Section 3.21 and
Section 4.18, respectively of this Agreement. The obligations
of the Interim Servicer in respect of any Prepayment Interest
Shortfalls are set forth in the Interim Servicing
Agreement.
“ Prepayment Period ”:
(i) With respect to the Servicer and any Distribution Date,
the calendar month preceding the month in which the related
Distribution Date occurs with respect to prepayments in part, and
the period beginning on the [____________] (1[__]) day of the month
preceding the related Distribution Date (or, the period commencing
on the Cut-off Date, in connection with the first Prepayment
Period) and ending on the [____________] ([__]) day of the month in
which such Distribution Date occurs with respect to prepayments in
full and (ii) with respect to the Interim Servicer, as set forth in
the Interim Servicing Agreement.
“ Principal Prepayment
”: Any voluntary payment of principal made by the Mortgagor
on a Mortgage Loan which is received in advance of its scheduled
Due Date and which is not accompanied by an amount of interest
representing the full amount of scheduled interest due on any Due
Date in any month or months subsequent to the month of
prepayment.
“ Principal Distribution
Amount ”: With respect to any Distribution Date is
the sum of the Group I Principal Distribution Amount and the Group
II Principal Distribution Amount.
“ Principal Remittance
Amount ”: With respect to any Distribution Date is
the sum of the Group I Principal Remittance Amount and the Group II
Principal Remittance Amount.
“ Purchase Price ”:
With respect to any Mortgage Loan or REO Property to be purchased
pursuant to or as contemplated by Section 2.03, Section 3.13(c) or
Section 10.01 of this Agreement, and as confirmed by a
certification of a Servicing Officer to the Trustee, an amount
equal to the sum of (i) [__]% of the Stated Principal Balance
thereof as of the date of purchase (or such other price as provided
in Section 10.01), (ii) in the case of (x) a Mortgage Loan, accrued
interest on such Stated Principal Balance at the applicable Net
Mortgage Rate in effect from time to time from the Due Date as to
which interest was last covered by a payment by the Mortgagor or a
P&I Advance by the Servicer or the Interim Servicer, which
payment or P&I Advance had as of the date of purchase been
distributed pursuant to Section 5.01, through the end of the
calendar month in which the purchase is to be effected and (y) an
REO Property, the sum of (1) accrued interest on such Stated
Principal Balance at the applicable Net Mortgage Rate in effect
from time to time from the Due Date as to which interest was last
covered by a payment by the Mortgagor or a P&I Advance by the
Servicer or the Interim Servicer through the end of the calendar
month immediately preceding the calendar month in which such REO
Property was acquired, plus (2) REO Imputed Interest for such REO
Property for each calendar month commencing with the calendar month
in which such REO Property was acquired and ending with the
calendar month in which such purchase is to be effected, net of the
total of all net rental income, Insurance Proceeds, Liquidation
Proceeds and P&I Advances that as of the date of purchase had
been distributed as or to cover REO Imputed Interest pursuant to
Section 5.01, (iii) any unreimbursed Servicing Advances and P&I
Advances (including Nonrecoverable P&I Advances and
Nonrecoverable Servicing Advances) and any unpaid Servicing Fees
allocable to such Mortgage Loan or REO Property, (iv) any amounts
previously withdrawn from the Collection Account pursuant to
Section 3.09(a)(ix) and Section 3.13(b) and (v) in the case of a
Mortgage Loan required to be purchased pursuant to Section 2.03,
expenses reasonably incurred or to be incurred by the Interim
Servicer, the Servicer or the Trustee in respect of the breach or
defect giving rise to the purchase obligation and any costs and
damages incurred by the Trust Fund and the Trustee in connection
with any violation by any such Mortgage Loan of any predatory or
abusive lending law.
“ QIB ”: As defined in
Section 6.01(c).
“ Qualified Substitute Mortgage
Loan ”: A mortgage loan substituted for a Deleted
Mortgage Loan pursuant to the terms of this Agreement which must,
on the date of such substitution, (i) have an outstanding principal
balance, after application of all scheduled payments of principal
and interest due during or prior to the month of substitution, not
in excess of the Scheduled Principal Balance of the Deleted
Mortgage Loan as of the Due Date in the calendar month during which
the substitution occurs, (ii) have a Mortgage Rate not less than
(and not more than [__] percentage point in excess of) the Mortgage
Rate of the Deleted Mortgage Loan, (iii) if the mortgage loan is an
Adjustable Rate Mortgage Loan, have a Maximum Mortgage Rate not
less than the Maximum Mortgage Rate on the Deleted Mortgage Loan,
(iv) if the mortgage loan is an Adjustable Rate Mortgage Loan, have
a Minimum Mortgage Rate not less than the Minimum Mortgage Rate of
the Deleted Mortgage Loan, (v) if the mortgage loan is an
Adjustable Rate Mortgage Loan, have a Gross Margin equal to the
Gross Margin of the Deleted Mortgage Loan, (vi) if the mortgage
loan is an Adjustable Rate Mortgage Loan, have a next Adjustment
Date not more than two months later than the next Adjustment Date
on the Deleted Mortgage Loan, (vii) have a remaining term to
maturity not greater than (and not more than one year less than)
that of the Deleted Mortgage Loan, (viii) have the same Due Date as
the Due Date on the Deleted Mortgage Loan, (ix) have a
Loan-to-Value Ratio as of the date of substitution equal to or
lower than the Loan-to-Value Ratio of the Deleted Mortgage Loan as
of such date, (x) be secured by the same lien priority on the
related Mortgaged Property as the Deleted Loan, (xi) have a credit
grade at least equal to the credit grading assigned on the Deleted
Mortgage Loan, (xii) be a “qualified mortgage” as
defined in the REMIC Provisions and (xiii) conform to each
representation and warranty set forth in Section 6 of the Mortgage
Loan Purchase Agreement applicable to the Deleted Mortgage Loan.
In the event that one or more mortgage loans are substituted
for one or more Deleted Mortgage Loans, the amounts described in
clause (i) hereof shall be determined on the basis of aggregate
principal balances, the Mortgage Rates described in clause (ii)
hereof shall be determined on the basis of weighted average
Mortgage Rates, the terms described in clause (vii) hereof shall be
determined on the basis of weighted average remaining term to
maturity, the Loan-to-Value Ratios described in clause (ix) hereof
shall be satisfied as to each such mortgage loan, the credit grades
described in clause (x) hereof shall be satisfied as to each such
mortgage loan and, except to the extent otherwise provided in this
sentence, the representations and warranties described in clause
(xii) hereof must be satisfied as to each Qualified Substitute
Mortgage Loan or in the aggregate, as the case may be.
“ Rate/Term Refinancing
”: A Refinanced Mortgage Loan, the proceeds of which are not
more than a nominal amount in excess of the existing first mortgage
loan and any subordinate mortgage loan on the related Mortgaged
Property and related closing costs, and were used exclusively
(except for such nominal amount) to satisfy the then existing first
mortgage loan and any subordinate mortgage loan of the Mortgagor on
the related Mortgaged Property and to pay related closing
costs.
“ Rating Agency or Rating
Agencies ”: Fitch, Moody’s and S&P or their
successors. If such agencies or their successors are no longer in
existence, “Rating Agencies” shall be such nationally
recognized statistical rating agencies, or other comparable
Persons, designated by the Depositor, notice of which designation
shall be given to the Trustee and the Servicer.
“ Realized Loss ”:
With respect to each Mortgage Loan as to which a Final Recovery
Determination has been made, an amount (not less than [
]), as reported by
the Servicer to the Master Servicer (in substantially the form of
Schedule 4 hereto) or by the Interim Servicer to the Master
Servicer pursuant to the Interim Servicing Agreement equal to (i)
the unpaid principal balance of such Mortgage Loan as of the
commencement of the calendar month in which the Final Recovery
Determination was made, plus (ii) accrued interest from the Due
Date as to which interest was last paid by the Mortgagor through
the end of the calendar month in which such Final Recovery
Determination was made, calculated in the case of each calendar
month during such period (A) at an annual rate equal to the annual
rate at which interest was then accruing on such Mortgage Loan and
(B) on a principal amount equal to the Stated Principal Balance of
such Mortgage Loan as of the close of business on the Distribution
Date during such calendar month, plus (iii) any amounts previously
withdrawn from the Collection Account or Custodial Account in
respect of such Mortgage Loan pursuant to Section 3.09(a)(ix) and
Section 3.13(b) of this Agreement or pursuant to the Interim
Servicing Agreement, minus (iv) the proceeds, if any, received in
respect of such Mortgage Loan during the calendar month in which
such Final Recovery Determination was made, net of amounts that are
payable therefrom to the Servicer or the Interim Servicer with
respect to such Mortgage Loan pursuant to Section 3.09(a)(iii) of
this Agreement or pursuant to the Interim Servicing
Agreement.
With respect to any REO Property as to
which a Final Recovery Determination has been made, an amount (not
less than [ ])
equal to (i) the unpaid principal balance of the related Mortgage
Loan as of the date of acquisition of such REO Property on behalf
of REMIC I, plus (ii) accrued interest from the Due Date as to
which interest was last paid by the Mortgagor in respect of the
related Mortgage Loan through the end of the calendar month
immediately preceding the calendar month in which such REO Property
was acquired, calculated in the case of each calendar month during
such period (A) at an annual rate equal to the annual rate at which
interest was then accruing on the related Mortgage Loan and (B) on
a principal amount equal to the Stated Principal Balance of the
related Mortgage Loan as of the close of business on the
Distribution Date during such calendar month, plus (iii) REO
Imputed Interest for such REO Property for each calendar month
commencing with the calendar month in which such REO Property was
acquired and ending with the calendar month in which such Final
Recovery Determination was made, plus (iv) any amounts previously
withdrawn from the Collection Account or Custodial Account in
respect of the related Mortgage Loan pursuant to Section
3.09(a)(ix) and Section 3.13(b) of this Agreement or pursuant to
the Interim Servicing Agreement, minus (v) the aggregate of all
P&I Advances and Servicing Advances (in the case of Servicing
Advances, without duplication of amounts netted out of the rental
income, Insurance Proceeds and Liquidation Proceeds described in
clause (vi) below) made by the Servicer or the Interim Servicer in
respect of such REO Property or the related Mortgage Loan for which
the Servicer or the Interim Servicer has been or, in connection
with such Final Recovery Determination, will be reimbursed pursuant
to Section 3.21 of this Agreement or pursuant to the Interim
Servicing Agreement out of rental income, Insurance Proceeds and
Liquidation Proceeds received in respect of such REO Property,
minus (vi) the total of all net rental income, Insurance Proceeds
and Liquidation Proceeds received in respect of such REO Property
that has been, or in connection with such Final Recovery
Determination, will be transferred to the Distribution Account
pursuant to Section 3.21 of this Agreement or pursuant to the
Interim Servicing Agreement.
With respect to each Mortgage Loan which
has become the subject of a Deficient Valuation, 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 which
has become the subject of a Debt Service Reduction, the portion, if
any, of the reduction in each affected Monthly Payment attributable
to a reduction in the Mortgage Rate imposed by a court of competent
jurisdiction. Each such Realized Loss shall be deemed to have been
incurred on the Due Date for each affected Monthly
Payment.
To the extent the Servicer or the Interim
Servicer receives Subsequent Recoveries, with respect to any
Mortgage Loan, the amount of Realized Loss with respect to that
Mortgage Loan will be reduced to the extent such recoveries are
applied to reduce the Certificate Principal Balance of any Class of
Certificates on any Distribution Date.
“ Record Date ”: With
respect to each Distribution Date and the Class [__] Certificates,
the [ ] Certificates and the Class [__]
Certificates, the Business Day immediately preceding such
Distribution Date for so long as such Certificates are Book-Entry
Certificates. With respect to each Distribution Date and any other
Class of Certificates, including any Definitive Certificates, the
last day of the calendar month immediately preceding the month in
which such Distribution Date occurs.
“ Reference Banks ”:
[_________________], [_________________] and [_________________]
and their successors in interest; provided, however, that if any of
the foregoing banks are not suitable to serve as a Reference Bank,
then any leading banks selected by the Securities Administrator
which are engaged in transactions in Eurodollar deposits in the
International Eurocurrency market (i) with an established place of
business in London, (ii) not controlling, under the control of or
under common control with the Depositor or any Affiliate thereof
and (iii) which have been designated as such by the Securities
Administrator.
“ Refinanced Mortgage Loan
”: A Mortgage Loan the proceeds of which were not used to
purchase the related Mortgaged Property.
“ Regular Certificate
”: Any Class [__] Certificate, [ ]
Certificate, Class [__] Certificate, Class [__] Certificate or
Class [__] Certificate.
“ Regular Interest ”:
A “regular interest” in a REMIC within the meaning of
Section 860G(a)(1) of the Code.
“ Regulation S Permanent Global
Certificate ”: As defined in Section 6.01(c).
“ Regulation S Temporary Global
Certificate ”: As defined in Section 6.01(c).
“ Release Date ”:
The [__] day after the later of (i) commencement of the
offering of the Class [__] Certificates and (ii) the Closing
Date.
“Regulation AB”
: Subpart 229.1100 – Asset
Backed Securities (Regulation AB), 17 C.F.R.
§§229.1100-229.1123, as such may be amended from time to
time, and subject to such clarification and interpretation as have
been provided by the Commission in the adopting release
(Asset-Backed Securities, Securities Act Release No. 33-8518, 70
Fed Reg. 1,506, 1.531 (Jan. 7, 2005)) or by the staff of the
Commission, or as may be provided by the Commission or its staff
from time to time.
“Relevant Servicing
Criteria” : The
Servicing Criteria applicable to each party, as set forth on
Exhibit [K] attached hereto. Multiple parties can have
responsibility for the same Relevant Servicing Criteria. With
respect to a Servicing Function Participant engaged by any of the
Master Servicer, the Securities Administrator or each Servicer, the
term Relevant Servicing Criteria may refer to a portion of the
Relevant Servicing Criteria applicable to such parties.
“ Relief Act ”: The
Servicemembers Civil Relief Act, as amended, or similar state or
local laws.
“ Relief Act Interest
Shortfall ”: With respect to any Distribution Date and
any Mortgage Loan, any reduction in the amount of interest
collectible on such Mortgage Loan for the most recently ended Due
Period as a result of the application of the Relief Act.
“ REMIC ”: A
“real estate mortgage investment conduit” within the
meaning of Section 860D of the Code.
“ REMIC I ”: The
segregated pool of assets subject hereto, constituting the primary
trust created hereby and to be administered hereunder, with respect
to which a REMIC election is to be made, consisting of: (i) such
Mortgage Loans and Prepayment Charges as from time to time are
subject to this Agreement, together with the Mortgage Files
relating thereto, and together with all collections thereon and
proceeds thereof; (ii) any REO Property, together with all
collections thereon and proceeds thereof; (iii) the Trustee’s
rights with respect to the Mortgage Loans under all insurance
policies required to be maintained pursuant to this Agreement and
any proceeds thereof; (iv) the Depositor’s rights under the
Mortgage Loan Purchase Agreement (including any security interest
created thereby), the [ ]Assignment
Agreement and the Interim Servicing Agreement and (v) the Custodial
Account, the Collection Account, the Distribution Account and any
REO Account, and such assets that are deposited therein from time
to time and any investments thereof, together with any and all
income, proceeds and payments with respect thereto. Notwithstanding
the foregoing, however, REMIC I specifically excludes (i) all
payments and other collections of principal and interest due on the
Mortgage Loans on or before the Cut-off Date and all Prepayment
Charges payable in connection with Principal Prepayments made
before the Cut-off Date; (ii) the Reserve Fund and any amounts on
deposit therein from time to time and any proceeds thereof, (iii)
the Swap Agreement and (iv) the Supplemental Interest
Trust.
“ REMIC I Group I Regular
Interests ”: REMIC I Regular Interest [__] and REMIC I
Regular Interest [__] through REMIC I Regular Interest [__] in the
Preliminary Statement hereto.
“ REMIC I Group II Regular
Interests ”: REMIC I Regular Interest [__] and
REMIC I Regular Interest [__] through REMIC II Regular Interest
[__] as designated in the Preliminary Statement hereto.
“ REMIC I Regular Interest
”: Any of the [__] separate non-certificated beneficial
ownership interests in REMIC I issued hereunder and designated as a
“regular interest” in REMIC I. Each REMIC I Regular
Interest shall accrue interest at the related REMIC I Remittance
Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement
hereto.
“
REMIC I Remittance Rate ”:
With respect to REMIC I Regular Interest [__], a per annum rate
equal to the weighted average of the Net Mortgage Rates of the
Group I Mortgage Loans. With respect to each REMIC I Group I
Regular Interest ending with the designation “[____]”,
a per annum rate equal to the weighted average of the Net Mortgage
Rates of the Group I Mortgage Loans multiplied by [2], subject to a
maximum rate of [__]%. With respect to each REMIC I Group I Regular
Interest ending with the designation “[____]”, the
greater of (x) a per annum rate equal to the excess, if any, of (i)
[2] multiplied by the weighted average of the Net Mortgage Rates of
the Group I Mortgage Loans over (ii) [__]% and (y) [__]%. With
respect to REMIC I Regular Interest [__], a per annum rate equal to
the weighted average of the Net Mortgage Rates of the Group II
Mortgage Loans With respect to each REMIC I Group II Regular
Interest ending with the designation “[____]”, a per
annum rate equal to the weighted average of the Expense Adjusted
Net Mortgage Rates of the Group II Mortgage Loans multiplied by
[2], subject to a maximum rate of [__]%. With respect to each REMIC
I Group II Regular Interest ending with the designation
“[____]”, the greater of (x) a per annum rate equal to
the excess, if any, of (i) [2] multiplied by the weighted average
of the Net Mortgage Rates of the Group II Mortgage Loans over (ii)
[__]% and (y) [__]%. With respect to REMIC I Regular Interest
P, [__]%.
“ REMIC II ”: The
segregated pool of assets consisting of all of the REMIC I Regular
Interests conveyed in trust to the Trustee, for the benefit of the
REMIC II Regular Interests pursuant to Section 2.07, and all
amounts deposited therein, with respect to which a separate REMIC
election is to be made.
“ REMIC II Interest Loss
Allocation Amount ”: With respect to any Distribution
Date, an amount equal to (a) the product of (i) [__]% of the
aggregate Stated Principal Balance of the Mortgage Loans and REO
Properties then outstanding and (ii) the REMIC II Remittance Rate
for REMIC II Regular Interest [____] minus the Marker Rate, divided
by (b) 12.
“ REMIC II Marker Allocation
Percentage ”: [__]% of any amount payable or loss
attributable from the Mortgage Loans, which shall be allocated to
REMIC II Regular Interest [____] and REMIC II Regular Interest
[____].
“ REMIC II Overcollateralization
Amount ”: With respect to any date of determination, (i)
[___]% of the aggregate Uncertificated Balances of the REMIC II
Regular Interests minus (ii) the aggregate of the Uncertificated
Balances of REMIC II Regular Interest [____], REMIC II Regular
Interest [____], in each case as of such date of
determination.
“ REMIC II Principal Loss
Allocation Amount ”: With respect to any Distribution
Date, an amount equal to (a) the product of (i) [___]% of the
aggregate Stated Principal Balance of the Mortgage Loans and REO
Properties then outstanding and (ii) [__] minus a fraction,
the numerator of which is [__] times the aggregate of the
Uncertificated Balances of REMIC II Regular Interest [____] and
REMIC II Regular Interest [____].
“ REMIC II Regular Interest
”: Any of the separate non-certificated beneficial ownership
interests in REMIC II issued hereunder and designated as a
“regular interest” in REMIC II. Each REMIC II Regular
Interest shall accrue interest at the related REMIC II Remittance
Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto. The
designations for the respective REMIC II Regular Interests are set
forth in the Preliminary Statement hereto.
“ REMIC II Regular Interest
[____] ”: One of the separate non-certificated beneficial
ownership interests in REMIC II issued hereunder and designated as
a Regular Interest in REMIC II. REMIC II Regular Interest
[____] shall accrue interest at the related REMIC II Remittance
Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement
hereto.
“ REMIC II Regular Interest
[____] ”: One of the separate non-certificated beneficial
ownership interests in REMIC II issued hereunder and designated as
a Regular Interest in REMIC II. REMIC II Regular Interest [____]
shall accrue interest at the related REMIC II Remittance Rate in
effect from time to time, and shall be entitled to distributions of
principal, subject to the terms and conditions hereof, in an
aggregate amount equal to its initial Uncertificated Balance as set
forth in the Preliminary Statement hereto.
“ REMIC II Remittance Rate
”: With respect to REMIC II Regular Interest [____],
REMIC II Regular Interest [____] and REMIC II Regular Interest
[____], a per annum rate (but not less than [
]) equal to the
weighted average of: (w) with respect to REMIC I Regular Interest
[___] and REMIC I Regular Interest [___], the REMIC I Remittance
Rate for each such REMIC I Regular Interest for each such
Distribution Date, (x) with respect to each REMIC I Regular
Interest ending with the designation “[____]”, the
weighted average of the REMIC I Remittance Rates for such REMIC I
Regular Interests, weighted on the basis of the Uncertificated
Balances of such REMIC I Regular Interests for each such
Distribution Date and (y) with respect to REMIC I Regular Interests
ending with the designation “[____]”, for each
Distribution Date listed below, the weighted average of the rates
listed below for each such REMIC I Regular Interest listed below,
weighted on the basis of the Uncertificated Balances of each such
REMIC I Regular Interest for each such Distribution
Date:
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[__________]
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[________________________]
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[________________________]
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[__________]
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[________________________]
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[________________________]
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[__________]
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[________________________]
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[________________________]
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With respect to REMIC II Regular Interest
[____], a per annum rate (but not less than [
]) equal to the
weighted average of: (w) with respect to REMIC I Regular Interest
[___], the REMIC I Remittance Rate for such REMIC 1 Regular
Interest for each such Distribution Date, (x) with respect to REMIC
I Group I Regular Interests ending with the designation
“[____]”, the weighted average of the REMIC I
Remittance Rates for such REMIC I Regular Interests, weighted on
the basis of the Uncertificated Balances of each such REMIC I
Regular Interest for each such Distribution Date and (y) with
respect to REMIC I Group I Regular Interests ending with the
designation “[____]”, for each Distribution Date listed
below, the weighted average of the rates listed below for such
REMIC I Regular Interests listed below, weighted on the basis of
the Uncertificated Balances of each such REMIC I Regular Interest
for each such Distribution Date:
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[__________]
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[________________________]
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[________________________]
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[__________]
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[________________________]
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[________________________]
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[__________]
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[________________________]
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[________________________]
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With respect to REMIC II Regular Interest
[____], a per annum rate (but not less than [
]) equal to the
weighted average of: (w) with respect to REMIC I Regular Interest
[__], the REMIC I Remittance Rate for such REMIC 1 Regular Interest
for each such Distribution Date, (x) with respect to REMIC I
Group II Regular Interests ending with the designation
“[____]”, the weighted average of the REMIC I
Remittance Rates for such REMIC I Regular Interests, weighted on
the basis of the Uncertificated Balances of each such REMIC I
Regular Interest for each such Distribution Date and (y) with
respect to REMIC I Group II Regular Interests ending with the
designation “[____]”, for each Distribution Date listed
below, the weighted average of the rates listed below for such
REMIC I Regular Interests listed below, weighted on the basis of
the Uncertificated Balances of each such REMIC I Regular Interest
for each such Distribution Date:
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[__________]
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[________________________]
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[________________________]
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[__________]
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[________________________]
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[________________________]
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[__________]
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[________________________]
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[________________________]
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With respect to REMIC II Regular Interest
[____], and (i) the first Distribution Date through the [
] Distribution Date, the excess of (x) the weighted
average of the REMIC I Remittance Rates for REMIC I Regular
Interests including the designation “[____]”, over (y)
[2] multiplied by Swap LIBOR. and (ii) thereafter, [___]%.
With respect to REMIC II Regular Interest [___],
[___]%.
“ REMIC II Sub WAC Allocation
Percentage ”: [___]% of any amount payable or loss
attributable from the Mortgage Loans, which shall be allocated to
REMIC II Regular Interest [____], REMIC II Regular Interest [____],
REMIC II Regular Interest [____], REMIC II Regular Interest [____]
and REMIC II Regular Interest [____].
“ REMIC II Subordinated Balance
Ratio ”: The ratio among the Uncertificated Balances of
each REMIC II Regular Interest ending with the designation
“SUB,”, equal to the ratio between, with respect to
each such REMIC II Regular Interest, the excess of (x) the
aggregate Stated Principal Balance of the Group I Mortgage Loans or
Group II Mortgage Loans, as applicable over (y) the current
Certificate Principal Balance of related Class [____]
Certificates.
“ REMIC II Required
Overcollateralization Amount ”: [___]% of the Required
Overcollateralization Amount.
“ REMIC III ”: The
segregated pool of assets consisting of all of the REMIC II Regular
Interests conveyed in trust to the Trustee, for the benefit of the
REMIC III Certificateholders pursuant to Section 2.07, and all
amounts deposited therein, with respect to which a separate REMIC
election is to be made.
“ REMIC III Certificate
”: Any Regular Certificate or Class [____]
Certificate.
“ REMIC III
Certificateholder ”: The Holder of any REMIC III
Certificate.
“ REMIC Provisions ”:
Provisions of the federal income tax law relating to real estate
mortgage investment conduits, which appear at Section 860A through
860G of the Code, and related provisions, and proposed, temporary
and final regulations and published rulings, notices and
announcements promulgated thereunder, as the foregoing may be in
effect from time to time.
“ REMIC Regular Interest
”: Any REMIC I Regular Interest or REMIC II Regular
Interest.
“ REMIC Remittance Rate
”: The REMIC I Remittance Rate or the REMIC II Remittance
Rate.
“ Remittance Report ”:
A report by the Servicer pursuant to Section 5.03(a) of this
Agreement or the Interim Servicer pursuant to the Interim Servicing
Agreement.
“ Rents from Real Property
”: With respect to any REO Property, gross income of the
character described in Section 856(d) of the Code as being included
in the term “rents from real property.”
“ REO Account ”: The
account or accounts maintained, or caused to be maintained, by the
Servicer in respect of an REO Property pursuant to Section 3.21 of
this Agreement or by the Interim Servicer pursuant to the Interim
Servicing Agreement.
“ REO Disposition ”:
The sale or other disposition of an REO Property on behalf of REMIC
I.
“ REO Imputed Interest
”: As to any REO Property, for any calendar month during
which such REO Property was at any time part of REMIC I, [__]
month’s interest at the applicable Net Mortgage Rate on the
Stated Principal Balance of such REO Property (or, in the case of
the first such calendar month, of the related Mortgage Loan, if
appropriate) as of the close of business on the Distribution Date
in such calendar month.
“ REO Principal Amortization
”: With respect to any REO Property, for any calendar month,
the excess, if any, of (a) the aggregate of all amounts received in
respect of such REO Property during such calendar month, whether in
the form of rental income, sale proceeds (including, without
limitation, that portion of the Termination Price paid in
connection with a purchase of all of the Mortgage Loans and REO
Properties pursuant to Section 10.01 of this Agreement that is
allocable to such REO Property) or otherwise, net of any portion of
such amounts (i) payable in respect of the proper operation,
management and maintenance of such REO Property or (ii) payable or
reimbursable to the Servicer pursuant to Section 3.21(d) of this
Agreement or the Interim Servicer pursuant to the Interim Servicing
Agreement for unpaid Servicing Fees in respect of the related
Mortgage Loan and unreimbursed Servicing Advances and P&I
Advances in respect of such REO Property or the related Mortgage
Loan, over (b) the REO Imputed Interest in respect of such REO
Property for such calendar month.
“ REO Property ”: A
Mortgaged Property acquired by the Servicer or its nominee on
behalf of REMIC I through foreclosure or deed-in-lieu of
foreclosure, as described in Section 3.21 of this Agreement or the
Interim Servicer pursuant to the related Interim Servicing
Agreement.
“ Reportable Event ”:
As defined in Section 5.06(c)(i).
“ Required Overcollateralization
Amount ”: With respect to any Distribution Date (i)
prior to the Stepdown Date, the product of (A) [___]% and (B) the
aggregate principal balance of the Mortgage Loans as of the Cut-off
Date, (ii) on or after the Stepdown Date provided a Trigger Event
is not in effect, the greater of (x) [___]% of the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the
related Due Period and (y) an amount equal to the product of (A)
[___]% and (B) the aggregate principal balance of the Mortgage
Loans as of the Cut-off Date, and (iii) on or after the Stepdown
Date and a Trigger Event is in effect, the Required
Overcollateralization Amount for the immediately preceding
Distribution Date. Notwithstanding the foregoing, on and
after any Distribution Date following the reduction of the
aggregate Certificate Principal Balance of the Class [____]
Certificates, [____________] Certificates and Class [____]
Certificates to [___], the Required Overcollateralization Amount
shall be [__].
“ Reserve Fund ”: A
fund created pursuant to Section 3.24 which shall be an asset of
the Trust Fund but which shall not be an asset of any Trust
REMIC.
“ Reserve Interest Rate
”: With respect to any Interest Determination Date, the rate
per annum that the Securities Administrator determines to be either
(i) the arithmetic mean (rounded upwards if necessary to the
nearest whole multiple of [___]%) of the one-month U.S. dollar
lending rates which New York City banks selected by the Securities
Administrator, after consultation with the Depositor, are quoting
on the relevant Interest Determination Date to the principal London
offices of leading banks in the London interbank market or (ii) in
the event that the Securities Administrator can determine no such
arithmetic mean, the lowest one-month U.S. dollar lending rate
which New York City banks selected by the Securities Administrator
are quoting on such Interest Determination Date to leading European
banks.
“ Residential Dwelling
”: Any one of the following: (i) a detached one-family
dwelling, (ii) a detached two- to four-family dwelling, (iii) a
one-family dwelling unit in a Fannie Mae eligible condominium
project, (iv) a manufactured home, or (v) a detached one-family
dwelling in a planned unit development, none of which is a
co-operative or mobile home.
“ Residual Certificate
”: Any one of the Class [____] Certificates.
“ Residual Interest ”:
The sole class of “residual interests” in a REMIC
within the meaning of Section 860G(a)(2) of the Code.
“ Responsible Officer
”: When used with respect to the Trustee, any officer of the
Trustee having direct responsibility for the administration of this
Agreement and, with respect to a particular matter, to whom such
matter is referred because of such officer’s knowledge of and
familiarity with the particular subject.
“ Rule 144A ”: As
defined in Section 6.01(c).
“ S&P ”: Standard
& Poor’s, a division of the McGraw-Hill Companies,
Inc.
“Sarbanes-Oxley
Act” : The
Sarbanes-Oxley Act of 2002 and the rules and regulations of the
Commission promulgated thereunder (including any interpretations
thereof by the Commission’s staff).
“Sarbanes-Oxley
Certification” :
As defined in Section 5.06(b)(iv).
“ Scheduled Principal
Balance ”: With respect to any Mortgage Loan: (a) as of
the Cut-off Date, the outstanding principal balance of such
Mortgage Loan as of such date, net of the principal portion of all
unpaid Monthly Payments, if any, due on or before such date; (b) as
of any Due Date subsequent to the Cut-off Date up to and including
the Due Date in the calendar month in which a Liquidation Event
occurs with respect to such Mortgage Loan, the Scheduled Principal
Balance of such Mortgage Loan as of the Cut-off Date, minus the sum
of (i) the principal portion of each Monthly Payment due on or
before such Due Date but subsequent to the Cut-off Date, whether or
not received, (ii) all Principal Prepayments received before such
Due Date but after the Cut-off Date, (iii) the principal portion of
all Liquidation Proceeds and Insurance Proceeds received before
such Due Date but after the Cut-off Date, net of any portion
thereof that represents principal due (without regard to any
acceleration of payments under the related Mortgage and Mortgage
Note) on a Due Date occurring on or before the date on which such
proceeds were received and (iv) any Realized Loss incurred with
respect thereto as a result of a Deficient Valuation occurring
before such Due Date, but only to the extent such Realized Loss
represents a reduction in the portion of principal of such Mortgage
Loan not yet due (without regard to any acceleration of payments
under the related Mortgage and Mortgage Note) as of the date of
such Deficient Valuation; and (c) as of any Due Date subsequent to
the occurrence of a Liquidation Event with respect to such Mortgage
Loan, [ ]. With
respect to any REO Property: (a) as of any Due Date subsequent to
the date of its acquisition on behalf of the Trust Fund up to and
including the Due Date in the calendar month in which a Liquidation
Event occurs with respect to such REO Property, an amount (not less
than [ ]) equal to
the Scheduled Principal Balance of the related Mortgage Loan as of
the Due Date in the calendar month in which such REO Property was
acquired, minus the aggregate amount of REO Principal Amortization,
if any, in respect of REO Property for all previously ended
calendar months; and (b) as of any Due Date subsequent to the
occurrence of a Liquidation Event with respect to such REO
Property, [
].
“ Securities Act ”:
The Securities Act of 1933, as amended.
“ Securities Administrator
”: As of the Closing Date, [
] and thereafter,
its respective successors in interest that meet the qualifications
of this Agreement. The Securities Administrator and the Master
Servicer shall at all times be the same Person or
Affiliates.
“ Seller ”:
[_________________] or its successor in interest, in its capacity
as seller under the Mortgage Loan Purchase Agreement.
“ Senior Interest Distribution
Amount ”: With respect to any Distribution Date, an
amount equal to the sum of (i) the Interest Distribution Amount for
such Distribution Date for the Class [____] Certificates and (ii)
the Interest Carry Forward Amount, if any, for such Distribution
Date for the Class [____] Certificates.
“Servicing Function
Participant” : Any
Subservicer, Subcontractor or any other Person, other than the
Servicer, the Master Servicer and the Securities Administrator,
that is participating in the servicing function within the meaning
of Regulation AB, unless such Person’s activities relate only
to 5% or less of the Mortgage Loans (calculated by Aggregate Pool
Principal Balance).
“ Servicer ”:
[_________________], or any successor thereto appointed hereunder
in connection with the servicing and administration of the Mortgage
Loans.
“ Servicer Event of Default
”: One or more of the events described in Section
8.01(a).
“ Servicer Remittance Date
”: With respect to any Distribution Date, by 12:00 p.m. New
York time on the [___] day of the month in which such Distribution
Date occurs; provided that if such [___] day of a given month is
not a Business Day, the Servicer Remittance Date for such month
shall be the Business Day immediately preceding such [___]
day.
“ Servicer Report ”: A
report (substantially in the form of Schedule 5 hereto) or
otherwise in form and substance acceptable to the Master Servicer
and Securities Administrator on an electronic data file or tape
prepared by the Servicer or the Interim Servicer pursuant to
Section 5.03(a) of this Agreement or pursuant to the Interim
Servicing Agreement, as applicable, with such additions, deletions
and modifications as agreed to by the Master Servicer, the
Securities Administrator and the Servicer or the Interim
Servicer.
“ Servicing Advances
”: The customary and reasonable “out-of-pocket”
costs and expenses incurred prior to or on or after the Cut-off
Date (the amounts incurred prior to the Cut-off Date shall be
identified on the Servicing Advance Schedule by (a) the Servicer or
the Interim Servicer with respect to any Mortgage Loans that were
transferred to the Servicer or the Interim Servicer prior to the
Cut-off Date and/or (b) the Depositor with respect to any Mortgage
Loans that were transferred to the Servicer or the Interim Servicer
after the Cut-off Date, as applicable) by the Servicer or the
Interim Servicer in connection with a default, delinquency or other
unanticipated event by the Servicer or the Interim Servicer in the
performance of its servicing obligations, including, but not
limited to, the cost of (i) the preservation, restoration and
protection of a Mortgaged Property, (ii) any enforcement or
judicial proceedings, including but not limited to foreclosures, in
respect of a particular Mortgage Loan, including any expenses
incurred in relation to any such proceedings that result from the
Mortgage Loan being registered on the [MERS® System], (iii) the
management (including reasonable fees in connection therewith) and
liquidation of any REO Property, (iv) the performance of its
obligations under Section 3.01, Section 3.07,
Section 3.11, Section 3.13 and Section 3.21 of this
Agreement and (v) obtaining any legal documentation required to be
included in the Mortgage File and/or correcting any outstanding
title issues (i.e., any lien or encumbrance on the Mortgaged
Property that prevents the effective enforcement of the intended
lien position) reasonably necessary for the Servicer or the Interim
Servicer to perform its obligations under this Agreement or the
related Interim Servicing Agreement. Servicing Advances also
include any reasonable “out-of-pocket” cost and
expenses (including legal fees) incurred by the Servicer or the
Interim Servicer in connection with executing and recording
instruments of satisfaction, deeds of reconveyance or Assignments
to the extent not recovered from the Mortgagor or otherwise payable
under this Agreement or the Interim Servicing Agreement.
Neither the Servicer nor the Interim Servicer shall be
required to make any Nonrecoverable Servicing Advances.
“ Servicing Advance Schedule
”: With respect to any Servicing Advances incurred
prior to the Cut-off Date, the schedule or schedules provided by
(a) the Servicer or the Interim Servicer with respect to any
Mortgage Loans that were transferred to the Servicer or the Interim
Servicer prior to the Cut-off Date and/or (b) the Depositor with
respect to any Mortgage Loans that were transferred to the Servicer
or the Interim Servicer after the Cut-off Date, as applicable, to
the Master Servicer and, if such schedule is provided by the
Depositor, to the Servicer, on the earlier of the date on which the
Servicer or the Interim Servicer seeks reimbursement for a
Servicing Advance made by the Servicer or the Interim Servicer or
[___] ([__]) Business Days following the Servicing Transfer Date,
which schedule or schedules shall contain the information set forth
on Schedule 6.
“ Servicing Fee ”:
With respect to each Mortgage Loan and for any calendar month, an
amount equal to [____________] of the product of the Servicing Fee
Rate multiplied by the Scheduled Principal Balance of the Mortgage
Loans as of the Due Date in the preceding calendar month. The
Servicing Fee is payable solely from collections of interest on the
Mortgage Loans.
“ Servicing Fee Rate
”: [__]% per annum.
“ Servicing Officer ”:
Any officer of the Servicer, the Interim Servicer or the Master
Servicer involved in, or responsible for, the administration and
servicing of Mortgage Loans, whose name and specimen signature
appear on a list of Servicing Officers furnished by the Servicer,
the Interim Servicer or the Master Servicer, to the Trustee, the
Master Servicer (in the case of the Servicer or the Interim
Servicer), the Securities Administrator and the Depositor on the
Closing Date, as such list may from time to time be
amended.
“ Servicing Transfer Date
”: With respect to the [_________________],
[_____________], 200[__].
“ Single Certificate
”: With respect to any Class of Certificates (other
than the Residual Certificates), a hypothetical Certificate of such
Class evidencing a Percentage Interest for such Class corresponding
to an initial Certificate Principal Balance of $[___]. With respect
to the Residual Certificates, a hypothetical Certificate of such
Class evidencing a [__]% Percentage Interest in such
Class.
“ Startup Day ”: With
respect to each Trust REMIC, the day designated as such pursuant to
Section 11.01(b) hereof.
“ Stated Principal Balance
”: With respect to any Mortgage Loan: (a) as of any date of
determination up to but not including the Distribution Date on
which the proceeds, if any, of a Liquidation Event with respect to
such Mortgage Loan would be distributed, the Scheduled Principal
Balance of such Mortgage Loan as of the Cut-off Date, as shown in
the Mortgage Loan Schedule, minus the sum of (i) the principal
portion of each Monthly Payment due on a Due Date subsequent to the
Cut-off Date, to the extent received from the Mortgagor or advanced
by the Servicer or the Interim Servicer or a successor to the
Servicer or the Interim Servicer (including the Master Servicer)
and distributed pursuant to Section 5.01 of this Agreement on or
before such date of determination, (ii) all Principal Prepayments
received after the Cut-off Date, to the extent distributed pursuant
to Section 5.01 of this Agreement on or before such date of
determination, (iii) all Liquidation Proceeds and Insurance
Proceeds applied by the Servicer or the Interim Servicer as
recoveries of principal in accordance with the provisions of
Section 3.13 of this Agreement or pursuant to the Interim Servicing
Agreement, to the extent distributed pursuant to Section 5.01 of
this Agreement on or before such date of determination, and (iv)
any Realized Loss incurred with respect thereto as a result of a
Deficient Valuation made during or prior to the Prepayment Period
for the most recent Distribution Date coinciding with or preceding
such date of determination; and (b) as of any date of determination
coinciding with or subsequent to the Distribution Date on which the
proceeds, if any, of a Liquidation Event with respect to such
Mortgage Loan would be distributed, [
]. With respect to
any REO Property: (a) as of any date of determination up to but not
including the Distribution Date on which the proceeds, if any, of a
Liquidation Event with respect to such REO Property would be
distributed, an amount (not less than [___]) equal to the Stated
Principal Balance of the related Mortgage Loan as of the date on
which such REO Property was acquired on behalf of REMIC I, minus
the sum of (i) if such REO Property was acquired before the
Distribution Date in any calendar month, the principal portion of
the Monthly Payment due on the Due Date in the calendar month of
acquisition, to the extent advanced by the Servicer, the Interim
Servicer or a successor to the Servicer or the Interim Servicer
(including the Master Servicer) and distributed pursuant to Section
5.01 of this Agreement, on or before such date of determination and
(ii) the aggregate amount of REO Principal Amortization in respect
of such REO Property for all previously ended calendar months, to
the extent distributed pursuant to Section 4.01 of this Agreement
on or before such date of determination; and (b) as of any date of
determination coinciding with or subsequent to the Distribution
Date on which the proceeds, if any, of a Liquidation Event with
respect to such REO Property would be distributed,
[___].
“ Stepdown Date ”: The
earlier to occur of (i) the later to occur of (a) the Distribution
Date occurring in [_____________], 200[__] and (b) the first
Distribution Date on which the Credit Enhancement Percentage
(calculated for this purpose only after taking into account
distributions of principal on the Mortgage Loans, but prior to any
distribution of the Principal Distribution Amount to the holders of
the Certificates then entitled to distributions of principal on
such Distribution Date), is greater than or equal to approximately
[___]% and (ii) the first Distribution Date on which the aggregate
Certificate Principal Balance of the Class [____] Certificates has
been reduced to [___].
“Subcontractor”
: Any outsourcer that performs one
or more discrete functions identified in Item 1122(d) of Regulation
AB with respect to more than 5% but less than 10% of the Mortgage
Loans under the direction or authority of the Master Servicer, the
Custodian, the Securities Administrator or the Servicer (measured
by Aggregate Pool Principal Balance of the Mortgage Loans, annually
at the commencement of the calendar year prior to the year in which
an Assessment of Compliance is required to be delivered, multiplied
by a fraction, the numerator of which is the number of months
during which such Subcontractor performs such discrete functions
and the denominator of which is 12, or, in the case of the year in
which the Closing Date occurs, the number of months elapsed in such
calendar year).
“ Subordinate Certificates
”: Collectively, the [____________] Certificates, the Class
[____] Certificates and the Class [____] Certificates.
“ Subsequent Recoveries
”: As of any Distribution Date, amounts received during the
related Prepayment Period by the Servicer or the Interim Servicer
specifically related to a defaulted Mortgage Loan or disposition of
an REO Property prior to the related Prepayment Period that
resulted in a Realized Loss, after the liquidation or disposition
of such defaulted Mortgage Loan.
“ Sub-Servicer ”:
Any Person that (a) services Mortgage Loans on behalf of the
Servicer pursuant to a Sub-Servicing Agreement and is responsible
for the performance of the material servicing functions required to
be performed by the Servicer under the Servicing Agreement that are
identified in Item 1122(d) of Regulation AB with respect to 10% or
more of the Mortgage Loans under the direction or authority of the
Servicer (measured by Aggregate Pool Principal Balance of the
Mortgage Loans, annually at the commencement of the calendar year
prior to the year in which an Assessment of Compliance is required
to be delivered, multiplied by a fraction, the numerator of which
is the number of months during which such Subservicer services the
related Mortgage Loans and the denominator of which is 12, or, in
the case of the year in which the Closing Date occurs, the number
of months elapsed in such calendar year).
“ Sub-Servicing Agreement
”: The written contract between the Servicer and a
Sub-Servicer relating to servicing and administration of certain
Mortgage Loans as provided in Section 3.02 of this
Agreement.
“ Substitution Shortfall
Amount ”: As defined in Section 2.03.
“ Supplemental Interest
Trust ”: The corpus of a trust created pursuant to
Section 5.07 of this Agreement and designated as the
“Supplemental Interest Trust,” consisting of the Swap
Agreement, the Class [____] Interest and the right to receive
payments in respect of the Class [____] Distribution Amount.
For the avoidance of doubt, the Supplemental Interest Trust
does not constitute a part of the Trust Fund.
“ Swap Agreement ”:
The Interest Rate Swap Agreement, dated as of [_____________],
200[__], between [_________________], as trustee on behalf of the
Supplemental Interest Trust, and the Swap Provider, which agreement
provides for Net Swap Payments and Swap Termination Payments to be
paid, as provided therein, together with any schedules,
confirmations or other agreements relating thereto. The
Trustee will provide a copy of the Swap Agreement to any
Certificateholder upon request.
“ Swap LIBOR ”:
LIBOR as determined pursuant to the Swap
Agreement.
“ Swap Notional Amount
”: For each calculation period as defined in the Swap
Agreement, the amount set forth below:
|
From and including:
|
To but excluding:
|
Swap Notional Amount:
|
|
[________________]
|
[___________________]
|
[_______________]
|
“ Swap Provider ”:
The swap provider under the Swap Agreement either (a)
entitled to receive payments from the Supplemental Interest Trust
or (b) required to make payments to the Supplemental Interest
Trust, in either case pursuant to the terms of the Swap Agreement,
and any successor in interest or assign. Initially, the Swap
Provider shall be [_________________].
“ Swap Provider Trigger
Event ”: A Swap Provider Trigger Event shall have
occurred if any of the following has occurred: (i) an Event of
Default under the Swap Agreement with respect to which the Swap
Provider is a Defaulting Party (as defined in the Swap Agreement),
(ii) a Termination Event under the Swap Agreement with respect to
which the Swap Provider is the sole Affected Party (as defined in
the Swap Agreement) or (iii) an Additional Termination Event under
the Swap Agreement with respect to which the Swap Provider is the
sole Affected Party.
“ Swap Termination Payment
”: Upon the designation of an “Early Termination
Date” as defined in the Swap Agreement, the payment to be
made by the Supplemental Interest Trust to the Swap Provider, or by
the Swap Provider to the Supplemental Interest Trust, as
applicable, pursuant to the terms of the Swap Agreement.
“ Tax Returns ”: The
federal income tax return on Internal Revenue Service Form 1066,
U.S. Real Estate Mortgage Investment Conduit Income Tax Return,
including Schedule Q thereto, Quarterly Notice to Residual Interest
Holders of REMIC Taxable Income or Net Loss Allocation, or any
successor forms, to be filed on behalf of the Trust REMICs under
the REMIC Provisions, together with any and all other information
reports or returns that may be required to be furnished to the
Certificateholders or filed with the Internal Revenue Service or
any other governmental taxing authority under any applicable
provisions of federal, state or local tax laws.
“ Telerate Page 3750
”: The display designated as page “3750” on the
Dow Jones Telerate Capital Markets Report (or such other page as
may replace page 3750 on that report for the purpose of displaying
London interbank offered rates of major banks).
“ Termination Price ”:
As defined in Section 10.01.
“ Transfer ”: Any
direct or indirect transfer, sale, pledge, hypothecation, or other
form of assignment of any Ownership Interest in a
Certificate.
“ Transferee ”: Any
Person who is acquiring by Transfer any Ownership Interest in a
Certificate.
“ Transferor ”: Any
Person who is disposing by Transfer of any Ownership Interest in a
Certificate.
“ Trigger Event ”: A
Trigger Event has occurred with respect to a Distribution Date if
either (x) the Delinquency Percentage exceeds [___]% of the Credit
Enhancement Percentage with respect to such Distribution Date or
(y) the aggregate amount of Realized Losses incurred since the
Cut-off Date through the last day of the related Due Period divided
by the aggregate principal balance of the Mortgage Loans as of the
Cut-off Date exceeds the applicable percentages set forth below
with respect to such Distribution Date:
|
Distribution Date
|
Percentage
|
|
[___]
|
[__]% plus [__] of [__]% for each month thereafter
|
|
[___]
|
[__]% plus [__] of [__]% for each month thereafter
|
|
[___]
|
[__]% plus [__] of [__]% for each month thereafter
|
|
[___]
|
[__]% plus [__] of [__]% for each month thereafter
|
|
[___] and thereafter
|
[__]%
|
“ Trust ”:
[_________________], the trust created hereunder.
“ Trust Fund ”:
Collectively, all of the assets of REMIC I, REMIC II, REMIC III and
the Reserve Fund and any amounts on deposit therein and any
proceeds thereof. For avoidance of doubt, the Trust Fund does
not include the Supplemental Interest Trust.
“ Trust REMIC ”: REMIC
I, REMIC II or REMIC III.
“ Trustee ”:
[_________________], a national banking association, or its
successor in interest, or any successor trustee appointed as herein
provided.
“ Uncertificated Balance
”: The amount of the REMIC Regular Interests outstanding as
of any date of determination. As of the Closing Date, the
Uncertificated Balance of each REMIC Regular Interest shall equal
the amount set forth in the Preliminary Statement hereto as its
initial uncertificated balance. On each Distribution Date, the
Uncertificated Balance of the REMIC Regular Interest shall be
reduced by all distributions of principal made on such REMIC
Regular Interest on such Distribution Date pursuant to Section 5.01
and, if and to the extent necessary and appropriate, shall be
further reduced on such Distribution Date by Realized Losses as
provided in Section 5.04 and the Uncertificated Balance of REMIC II
Regular Interest [____] shall be increased by interest deferrals as
provided in Section 5.01. The Uncertificated Balance of each REMIC
Regular Interest shall never be less than [___].
“ Uncertificated Interest
”: With respect to any REMIC Regular Interest for any
Distribution Date, [__] month’s interest at the related REMIC
Remittance Rate applicable to such REMIC Regular Interest for such
Distribution Date, accrued on the Uncertificated Balance thereof
immediately prior to such Distribution Date. Uncertificated
Interest in respect of the REMIC Regular Interests shall accrue on
the basis of a 360-day year consisting of twelve 30-day months.
Uncertificated Interest with respect to each Distribution Date, as
to any REMIC Regular Interest, shall be reduced by an amount equal
to the sum of (a) the aggregate Prepayment Interest Shortfall, if
any, for such Distribution Date to the extent not covered by
payments pursuant to Section 3.22 or Section 4.18 of this Agreement
or pursuant to the Interim Servicing Agreement and (b) the
aggregate amount of any Relief Act Interest Shortfall, if any
allocated, in each case, to such REMIC Regular Interest or REMIC
Regular Interest pursuant to Section 1.02. In addition,
Uncertificated Interest with respect to each Distribution Date, as
to any REMIC Regular Interest, shall be reduced by Realized Losses,
if any, allocated to such REMIC Regular Interest pursuant to
Section 1.02 and Section 5.04.
“ Uncertificated Notional
Amount ”: With respect to REMIC II Regular Interest
[____] and each Distribution Date listed below, the aggregate
Uncertificated Balance of the REMIC [___] Regular Interests ending
with the designation [“A”] listed below:
|
|
REMIC I Regular
Interests
|
|
[_________]
|
[_________________________________]
|
With respect to the Class [____] Interest
and any Distribution Date, an amount equal to the Uncertificated
Notional Amount of the REMIC II Regular Interest [____].
“ Uninsured Cause ”:
Any cause of damage to a Mortgaged Property such that the complete
restoration of such property is not fully reimbursable by the
hazard insurance policies required to be maintained pursuant to
Section 3.11.
“ United States Person
”: A citizen or resident of the United States, a corporation,
partnership or other entity created or organized in, or under the
laws of, the United States or any political subdivision thereof
(except, in the case of a partnership, to the extent provided in
regulations) provided that, for purposes solely of the restrictions
on the transfer of any Class [____] Certificate, no partnership or
other entity treated as a partnership for United States federal
income tax purposes shall be treated as a United States Person
unless all persons that own an interest in such partnership either
directly or through any entity that is not a corporation for United
States federal income tax purposes are required to be United States
Persons, or an estate whose income is subject to United States
federal income tax regardless of its source, or a trust if a court
within the United States is able to exercise primary supervision
over the administration of the trust and one or more United States
persons have the authority to control all substantial decisions of
the trust. To the extent prescribed in regulations by the Secretary
of the Treasury, a trust which was in existence on August 20, 1996
(other than a trust treated as owned by the grantor under subpart E
of part I of subchapter J of chapter I of the Code), and which was
treated as a United States person on August 20, 1996 may elect to
continue to be treated as a United States person notwithstanding
the previous sentence. The term “United States” shall
have the meaning set forth in Section 7701 of the Code.
“ Value ”: With
respect to any Mortgaged Property, the lesser of (i) the lesser of
(a) the value thereof as determined by an appraisal made for the
related Originator of the Mortgage Loan at the time of origination
of the Mortgage Loan by an appraiser who met the minimum
requirements of Fannie Mae and Freddie Mac and (b) the value
thereof as determined by a review appraisal conducted by the
related Originator of the Mortgage Loan in accordance with the
related Originator’s underwriting guidelines, and (ii) the
purchase price paid for the related Mortgaged Property by the
Mortgagor with the proceeds of the Mortgage Loan; provided,
however, (A) in the case of a Refinanced Mortgage Loan, such value
of the Mortgaged Property is based solely upon the lesser of (1)
the value determined by an appraisal made for the related
Originator of the Mortgage Loan of such Refinanced Mortgage Loan at
the time of origination of such Refinanced Mortgage Loan by an
appraiser who met the minimum requirements of Fannie Mae and
Freddie Mac and (2) the value thereof as determined by a review
appraisal conducted by the related Originator of the Mortgage Loan
in accordance with the related Originator’s underwriting
guidelines, and (B) in the case of a Mortgage Loan originated in
connection with a “lease-option purchase,” such value
of the Mortgaged Property is based on the lower of the value
determined by an appraisal made for the Originator of such Mortgage
Loan at the time of origination or the sale price of such Mortgaged
Property if the “lease option purchase price” was set
less than [__] months prior to origination, and is based on the
value determined by an appraisal made for the related Originator of
such Mortgage Loan at the time of origination if the “lease
option purchase price” was set [__] months or more prior to
origination.
“ Verification Report
”: As defined in Section 4.19.
“ Voting Rights ”: The
portion of the voting rights of all of the Certificates which is
allocated to any such Certificate. With respect to any date of
determination, [___]% of all Voting Rights will be allocated among
the holders of the Class [____] Certificates, the [____________]
Certificates and the Class [____] Certificates in proportion to the
then outstanding Certificate Principal Balances of their respective
Certificates, [___]% of all Voting Rights will be allocated among
the holders of the Class [____] Certificates and [___]% of all
Voting Rights will be allocated among the holders of the Class
[____] Certificates. The Voting Rights allocated to each Class of
Certificate shall be allocated among Holders of each such Class in
accordance with their respective Percentage Interests as of the
most recent Record Date.
“[____________] Custodial
Agreement ”: The Custodial Agreement dated as of
[_____________], 200[__], among the Trustee, the Master Servicer
and the Servicers, as may be amended or supplemented from time to
time.
SECTION 1.02.
Allocation of Certain Interest
Shortfalls.
For purposes of calculating the amount of
Accrued Certificate Interest and the amount of the Interest
Distribution Amount for the Class [____] Certificates, the
[____________] Certificates, the Class [____] Certificates and the
Class [____] Certificates for any Distribution Date, (1) the
aggregate amount of any Prepayment Interest Shortfalls (to the
extent not covered by payments by the Servicer pursuant to Section
3.21 of this Agreement or by the Master Servicer pursuant to
Section 4.18 of this Agreement or by the Interim Servicer pursuant
to the Interim Servicing Agreement) and any Relief Act Interest
Shortfalls incurred in respect of the Mortgage Loans for any
Distribution Date shall be allocated first, to the Class [____]
Certificates, second, to the Class [____] Certificates, on a pro
rata basis, in each case based on, and to the extent of, [__]
month’s interest at the then applicable respective
Pass-Through Rate on the respective Certificate Principal Balance
or Notional Amount, as applicable, of each such Certificate and (2)
the aggregate amount of any Realized Losses allocated to the Class
[____] Certificates, the [____________] Certificates and Net WAC
Rate Carryover Amounts paid to the Class [____] Certificates, the
[____________] Certificates and the Class [____] Certificates
incurred for any Distribution Date shall be allocated to the Class
[____] Certificates on a pro rata basis based on, and to the
extent of, [__] month’s interest at the then applicable
respective Pass-Through Rate on the respective Certificate
Principal Balance or Notional Amount thereof, as
applicable.
For purposes of calculating the amount of
Uncertificated Interest for the REMIC I Group I Regular Interests
for any Distribution Date, the aggregate amount of any Prepayment
Interest Shortfalls (to the extent not covered by payments by the
Servicer pursuant to Section 3.22 of this Agreement or the Master
Servicer pursuant to Section 4.18 or by the Interim Servicer
pursuant to the Interim Servicing Agreement) and any Relief Act
Interest Shortfalls incurred in respect of Group I Mortgage Loans
shall be allocated first, to REMIC I Regular Interest [__]
and to the REMIC I Group I Regular Interests ending with the
designation “[____]”, pro rata based on, and to
the extent of, [__] month’s interest at the then applicable
respective REMIC I Remittance Rates on the respective
Uncertificated Principal Balances of each such REMIC I Regular
Interest, and then, to REMIC I Group I Regular Interests ending
with the designation “[____]”, pro rata based on, and
to the extent of, [__] month’s interest at the then
applicable respective REMIC I Remittance Rates on the respective
Uncertificated Balances of each such REMIC I Regular
Interest.
For purposes of calculating the amount of
Uncertificated Interest for the REMIC I Group II Regular Interests
for any Distribution Date, the aggregate amount of any Prepayment
Interest Shortfalls (to the extent not covered by payments by the
Servicer pursuant to Section 3.22 of this Agreement or the Master
Servicer pursuant to Section 4.18 or by the Interim Servicer
pursuant to the Interim Servicing Agreement) and any Relief Act
Interest Shortfalls incurred in respect of Group II Mortgage Loans
shall be allocated first, to REMIC I Regular Interest [__] and to
the REMIC I Group II Regular Interests ending with the designation
“[____]”, pro rata based on, and to the extent
of, [__] month’s interest at the then applicable respective
REMIC I Remittance Rates on the respective Uncertificated Principal
Balances of each such REMIC I Regular Interest , and then, to REMIC
I Group II Regular Interests ending with the designation
“[____]”, pro rata based on, and to the extent of, [__]
month’s interest at the then applicable respective REMIC I
Remittance Rates on the respective Uncertificated Balances of each
such REMIC I Regular Interest.
For purposes of calculating the amount of
Uncertificated Interest for the REMIC II Regular Interests for any
Distribution Date:
(A)
The REMIC II Marker Allocation Percentage
of the aggregate amount of any Prepayment Interest Shortfalls (to
the extent not covered by payments by the Servicer pursuant to
Section 3.22 of this Agreement or the Master Servicer pursuant to
Section 4.18 or by the Interim Servicer pursuant to the Interim
Servicing Agreement) and the REMIC II Marker Allocation Percentage
of any Relief Act Interest Shortfalls incurred in respect of the
Mortgage Loans for any Distribution Date shall be allocated among
REMIC II Regular Interest [____], REMIC II Regular Interest [____],
pro rata based on, and to the extent of, [
] month’s
interest at the then applicable respective REMIC II Remittance Rate
on the respective Uncertificated Balance of each such REMIC II
Regular Interest; and
(B)
The REMIC II Sub WAC Allocation
Percentage of the aggregate amount of any Prepayment Interest
Shortfalls (to the extent not covered by payments by the Servicer
pursuant to Section 3.22 of this Agreement or by the Master
Servicer pursuant to Section 4.18 of this Agreement or by the
Interim Servicer pursuant to the Interim Servicing Agreement) and
the REMIC II Sub WAC Allocation Percentage of any Relief Act
Interest Shortfalls incurred in respect of the Mortgage Loans for
any Distribution Date shall be allocated first, to Uncertificated
Interest payable to REMIC II Regular Interest [____], REMIC II
Regular Interest [____] , pro rata based on, and to the
extent of, [ ]
month’s interest at the then applicable respective REMIC II
Remittance Rate on the respective Uncertificated Balance of each
such REMIC II Regular Interest.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01.
Conveyance of the Mortgage
Loans.
The Depositor, concurrently with the
execution and delivery hereof, does hereby transfer, assign, set
over and otherwise convey to the Trustee, on behalf of the Trust,
without recourse, for the benefit of the Certificateholders, all
the right, title and interest of the Depositor, including any
security interest therein for the benefit of the Depositor, in and
to the Mortgage Loans identified on the Mortgage Loan Schedule, the
rights of the Depositor under the Mortgage Loan Purchase Agreement
and the [ ] Assignment Agreement
(including, without limitation the right to enforce the obligations
of the other parties thereto thereunder), the right to any Net Swap
Payment and any Swap Termination Payment made by the Swap Provider,
and all other assets included or to be included in REMIC I. Such
assignment includes all interest and principal received by the
Depositor, the Servicer and the Interim Servicer on or with respect
to the Mortgage Loans (other than payments of principal and
interest due on such Mortgage Loans on or before the Cut-off Date).
The Depositor herewith delivers to the Trustee an executed
copy of the Mortgage Loan Purchase Agreement, and to the Master
Servicer and the Trustee, a copy of the Interim Servicing Agreement
and the [ ] Assignment
Agreement.
In connection with such transfer and
assignment, the Depositor does hereby deliver to, and deposit with
the related Custodian pursuant to the related Custodial Agreement
the documents with respect to each Mortgage Loan as described under
Section 2 of the Custodial Agreements (the “Mortgage Loan
Documents”). In connection with such delivery and as further
described in the Custodial Agreements, the Custodians will be
required to review such Mortgage Loan Documents and deliver to the
Trustee, the Depositor, the Servicer and the Seller certifications
(in the forms attached to the Custodial Agreements) with respect to
such review with exceptions noted thereon. In addition, under
the Custodial Agreements the Depositor will be required to cure
certain defects with respect to the Mortgage Loan Documents for the
related Mortgage Loans after the delivery thereof by the Depositor
to the Custodians as more particularly set forth
therein.
Notwithstanding anything to the contrary
contained herein, the parties hereto acknowledge that the functions
of the Trustee with respect to the custody, acceptance, inspection
and release of the Mortgage Files, including, but not limited to
certain insurance policies and documents contemplated by Section
4.11, and preparation and delivery of the certifications shall be
performed by the Custodians pursuant to the terms and conditions of
the Custodial Agreements.
The Depositor shall deliver or cause the
related Originator to deliver to the Servicer copies of all
trailing documents required to be included in the Mortgage File at
the same time the originals or certified copies thereof are
delivered to the Trustee or Custodians, such documents including
the mortgagee policy of title insurance and any Mortgage Loan
Documents upon return from the recording office. The Servicer
shall not be responsible for any custodian fees or other costs
incurred in obtaining such documents and the Depositor shall cause
the Servicer to be reimbursed for any such costs the Servicer may
incur in connection with performing its obligations under this
Agreement.
The Mortgage Loans permitted by the terms
of this Agreement to be included in the Trust are limited to (i)
Mortgage Loans (which the Depositor acquired pursuant to the
Mortgage Loan Purchase Agreement, which contains, among other
representations and warranties, a representation and warranty of
the Seller that no Mortgage Loan is a “High-Cost Home
Loan” as defined in the New Jersey Home Ownership Act
effective November 27, 2003 or as defined in the New Mexico Home
Loan Protection Act effective January 1, 2004, as defined in the
Massachusetts Predatory Home Loan Practices Act, effective November
7, 2004 (Mass. Ann. Laws Ch. 183C) or as defined in the Indiana
Home Loan Practices Act, effective January 1, 2005 (Ind. Code Ann.
Sections 24-9-1 through 24-9-9)) and (ii) Qualified Substitute
Mortgage Loans (which, by definition as set forth herein and
referred to in the Mortgage Loan Purchase Agreement, are required
to conform to, among other representations and warranties, the
representation and warranty of the Seller that no Qualified
Substitute Mortgage Loan is a “High-Cost Home Loan” as
defined in the New Jersey Home Ownership Act effective November 27,
2003 or as defined in the New Mexico Home Loan Protection Act
effective January 1, 2004, as defined in the Massachusetts
Predatory Home Loan Practices Act, effective November 7, 2004
(Mass. Ann. Laws Ch. 183C) or as defined in the Indiana Home Loan
Practices Act, effective January 1, 2005 (Ind. Code Ann. Sections
24-9-1 through 24-9-9). The Depositor and the Trustee on
behalf of the Trust understand and agree that it is not intended
that any mortgage loan be included in the Trust that is a
“High-Cost Home Loan” as defined in the New Jersey Home
Ownership Act effective November 27, 2003, as defined in the New
Mexico Home Loan Protection Act effective January 1, 2004, as
defined in the Massachusetts Predatory Home Loan Practices Act,
effective November 7, 2004 (Mass. Ann. Laws Ch. 183C) or as defined
in the Indiana Home Loan Practices Act, effective January 1, 2005
(Ind. Code Ann. Sections 24-9-1 through 24-9-9).
SECTION 2.02.
Acceptance of REMIC I by
Trustee.
The Trustee acknowledges receipt, subject
to the provisions of Section 2.01 hereof and Section 2 of the
Custodial Agreement, of the Mortgage Loan Documents and all other
assets included in the definition of “REMIC I” under
clauses (i), (iii), (iv) and (v) (to the extent of amounts
deposited into the Distribution Account) and declares that it holds
(or the applicable Custodian on its behalf holds) and will hold
such documents and the other documents delivered to it constituting
a Mortgage Loan Document, and that it holds (or the applicable
Custodian on its behalf holds) or will hold all such assets and
such other assets included in the definition of “REMIC
I” in trust for the exclusive use and benefit of all present
and future Certificateholders.
SECTION 2.03.
Repurchase or Substitution of Mortgage
Loans.
(a)
Upon discovery or receipt of notice of
any materially defective document in, or that a document is missing
from, a Mortgage File or of a breach by the Seller of any
representation, warranty or covenant under the Mortgage Loan
Purchase Agreement in respect of any Mortgage Loan that materially
and adversely affects the value of such Mortgage Loan or the
interest therein of the Certificateholders, the Trustee shall
promptly notify the Seller and the Servicer of such defect, missing
document or breach and request that the Seller deliver such missing
document, cure such defect or breach within [________] ([__]) days
from the date the Seller was notified of such missing document,
defect or breach, and if the Seller does not deliver such missing
document or cure such defect or breach in all material respects
during such period, the Trustee shall enforce the obligations of
the Seller under the Mortgage Loan Purchase Agreement to repurchase
such Mortgage Loan from REMIC I at the Purchase Price within
[________] ([__]) days after the date on which the Seller was
notified of such missing document, defect or breach, if and to the
extent that the Seller is obligated to do so under the Mortgage
Loan Purchase Agreement. The Purchase Price for the repurchased
Mortgage Loan shall be remitted to the Servicer for deposit in the
Collection Account and the Trustee, upon receipt of written
certification from the Servicer of such deposit, shall release or
cause the applicable Custodian (upon receipt of a request for
release in the form attached to the related Custodial Agreement) to
release to the Seller the related Mortgage File and the Trustee
shall execute and deliver such instruments of transfer or
assignment, in each case without recourse, representation or
warranty, as the Seller shall furnish to it and as shall be
necessary to vest in the Seller any Mortgage Loan released pursuant
hereto, and the Trustee shall not have any further responsibility
with regard to such Mortgage File. In lieu of repurchasing any such
Mortgage Loan as provided above, if so provided in the Mortgage
Loan Purchase Agreement, the Seller may cause such Mortgage Loan to
be removed from REMIC I (in which case it shall become a Deleted
Mortgage Loan) and substitute one or more Qualified Substitute
Mortgage Loans in the manner and subject to the limitations set
forth in Section 2.03(b). It is understood and agreed that the
obligation of the Seller to cure or to repurchase (or to substitute
for) any Mortgage Loan as to which a document is missing, a
material defect in a constituent document exists or as to which
such a breach has occurred and is continuing shall constitute the
sole remedy respecting such omission, defect or breach available to
the Trustee and the Certificateholders. Notwithstanding
anything to the contrary contained herein, any breach of a
representation or warranty contained in clauses (xxxiv), (xxxviii),
(xxxix), (xl), (xli), (xlvi), (xlvii) and/or (lvi) of Section 6 of
the Mortgage Loan Purchase Agreement shall be automatically deemed
to affect materially and adversely the interests of the
Certificateholders.
In addition, promptly upon the earlier of
discovery by the Servicer or receipt of notice by the Servicer of
the breach of the representation or covenant of the Seller set
forth in Section 5(xii) of the Mortgage Loan Purchase Agreement
which materially and adversely affects the interests of the Holders
of the Class [____] Certificates in any Prepayment Charge, the
Servicer shall promptly notify the Seller and the Trustee of such
breach. The Trustee shall enforce the obligations of the Seller
under the Mortgage Loan Purchase Agreement to remedy such breach to
the extent and in the manner set forth in the Mortgage Loan
Purchase Agreement.
(b)
Any substitution of Qualified Substitute
Mortgage Loans for Deleted Mortgage Loans made pursuant to Section
2.03(a) must be effected prior to the date which is two years after
the Startup Day for REMIC I.
As to any Deleted Mortgage Loan for which
the Seller substitutes a Qualified Substitute Mortgage Loan or
Loans, such substitution shall be effected by the Seller delivering
to the Trustee or the applicable Custodian on behalf of the
Trustee, for such Qualified Substitute Mortgage Loan or Loans, the
Mortgage Note, the Mortgage, the Assignment to the Trustee, and
such other documents and agreements, with all necessary
endorsements thereon, as are required by Section 2 of the Custodial
Agreements, as applicable, together with an Officers’
Certificate providing that each such Qualified Substitute Mortgage
Loan satisfies the definition thereof and specifying the
Substitution Shortfall Amount (as described below), if any, in
connection with such substitution. The applicable Custodian on
behalf of the Trustee shall acknowledge receipt of such Qualified
Substitute Mortgage Loan or Loans and, within [________] ([__])
Business Days thereafter, review such documents and deliver to the
Depositor, the Trustee and the Servicer, with respect to such
Qualified Substitute Mortgage Loan or Loans, an Initial
Certification pursuant to the Custodial Agreements, with any
applicable exceptions noted thereon. Within one year of the date of
substitution, the applicable Custodian on behalf of the Trustee
shall deliver to the Depositor, the Trustee and the Servicer a
Final Certification pursuant to the Custodial Agreement with
respect to such Qualified Substitute Mortgage Loan or Loans, with
any applicable exceptions noted thereon. Monthly Payments due with
respect to Qualified Substitute Mortgage Loans in the month of
substitution are not part of REMIC I and will be retained by the
Seller. For the month of substitution, distributions to
Certificateholders will reflect the Monthly Payment due on such
Deleted Mortgage Loan on or before the Due Date in the month of
substitution, and the Seller shall thereafter be entitled to retain
all amounts subsequently received in respect of such Deleted
Mortgage Loan. The Depositor shall give or cause to be given
written notice to the Certificateholders that such substitution has
taken place, shall amend the Mortgage Loan Schedule to reflect the
removal of such Deleted Mortgage Loan from the terms of this
Agreement and the substitution of the Qualified Substitute Mortgage
Loan or Loans and shall deliver a copy of such amended Mortgage
Loan Schedule to the Trustee and the Servicer. Upon such
substitution, such Qualified Substitute Mortgage Loan or Loans
shall constitute part of the Trust Fund and shall be subject in all
respects to the terms of this Agreement and the Mortgage Loan
Purchase Agreement, including all applicable representations and
warranties thereof included herein or in the Mortgage Loan Purchase
Agreement.
For any month in which the Seller
substitutes one or more Qualified Substitute Mortgage Loans for one
or more Deleted Mortgage Loans, the Servicer will determine the
amount (the “Substitution Shortfall Amount”), if any,
by which the aggregate Purchase Price of all such Deleted Mortgage
Loans exceeds the aggregate of, as to each such Qualified
Substitute Mortgage Loan, the Scheduled Principal Balance thereof
as of the date of substitution, together with [
] month’s
interest on such Scheduled Principal Balance at the applicable Net
Mortgage Rate, plus all outstanding P&I Advances and Servicing
Advances (including Nonrecoverable P&I Advances and
Nonrecoverable Servicing Advances) related thereto. On the date of
such substitution, the Seller will deliver or cause to be delivered
to the Servicer for deposit in the Collection Account an amount
equal to the Substitution Shortfall Amount, if any, and the Trustee
or the applicable Custodian on behalf of the Trustee, upon receipt
of the related Qualified Substitute Mortgage Loan or Loans, upon
receipt of a request for release in the form attached to the
related Custodial Agreement and certification by the Servicer of
such deposit, shall release to the Seller the related Mortgage File
or Files and the Trustee shall execute and deliver such instruments
of transfer or assignment, in each case without recourse,
representation or warranty, as the Seller shall deliver to it and
as shall be necessary to vest therein any Deleted Mortgage Loan
released pursuant hereto.
In addition, the Seller shall obtain at
its own expense and deliver to the Trustee an Opinion of Counsel to
the effect that such substitution will not cause (a) any federal
tax to be imposed on any Trust REMIC, including without limitation,
any federal tax imposed on “prohibited transactions”
under Section 860F(a)(1) of the Code or on “contributions
after the startup date” under Section 860G(d)(1) of the Code,
or (b) any Trust REMIC to fail to qualify as a REMIC at any time
that any Certificate is outstanding.
(c)
Upon discovery by the Depositor, the
Seller, the Servicer or the Trustee that any Mortgage Loan does not
constitute a “qualified mortgage” within the meaning of
Section 860G(a)(3) of the Code, the party discovering such fact
shall within [________] ([__]) Business Days give written notice
thereof to the other parties. In connection therewith, the Seller
shall repurchase or substitute one or more Qualified Substitute
Mortgage Loans for the affected Mortgage Loan within [________]
([__]) days of the earlier of discovery or receipt of such notice
with respect to such affected Mortgage Loan. Such repurchase or
substitution shall be made by (i) the Seller if the affected
Mortgage Loan’s status as a non-qualified mortgage is or
results from a breach of any representation, warranty or covenant
made by the Seller under the Mortgage Loan Purchase Agreement or
(ii) the Depositor, if the affected Mortgage Loan’s status as
a non-qualified mortgage does not result from a breach of a
representation or warranty. Any such repurchase or substitution
shall be made in the same manner as set forth in Section 2.03(a).
The Trustee shall reconvey to the Seller the Mortgage Loan to be
released pursuant hereto in the same manner, and on the same terms
and conditions, as it would a Mortgage Loan repurchased for breach
of a representation or warranty.
(d)
With respect to a breach of the
representations made pursuant to Section 5(xii) of the Mortgage
Loan Purchase Agreement that materially and adversely affects the
value of such Mortgage Loan or the interest therein of the
Certificateholders, the Seller shall be required to take the
actions set forth in this Section 2.03.
(e)
Within [________] ([__]) days of the
earlier of discovery by the Servicer or receipt of notice by the
Servicer of the breach of any representation, warranty or covenant
of the Servicer set forth in Section 2.05 which materially and
adversely affects the interests of the Certificateholders in any
Mortgage Loan or Prepayment Charge, the Servicer shall cure such
breach in all material respects.
SECTION 2.04.
Representations and Warranties of the
Master Servicer.
The Master Servicer hereby represents,
warrants and covenants to the Servicer, the Depositor and the
Trustee, for the benefit of each of the Trustee and the
Certificateholders, that as of the Closing Date or as of such date
specifically provided herein:
(i)
The Master Servicer is a national banking
association duly formed, validly existing and in good standing
under the laws of the United States of America and is duly
authorized and qualified to transact any and all business
contemplated by this Agreement to be conducted by the Master
Servicer;
(ii)
The Master Servicer has the full power
and authority to conduct its business as presently conducted by it
and to execute, deliver and perform, and to enter into and
consummate, all transactions contemplated by this Agreement. The
Master Servicer has duly authorized the execution, delivery and
performance of this Agreement, has duly executed and delivered this
Agreement, and this Agreement, assuming due authorization,
execution and delivery by the other parties hereto, constitutes a
legal, valid and binding obligation of the Master Servicer,
enforceable against it in accordance with its terms except as the
enforceability thereof may be limited by bankruptcy, insolvency,
reorganization or similar laws affecting the enforcement of
creditors’ rights generally and by general principles of
equity;
(iii)
The execution and delivery of this
Agreement by the Master Servicer, the consummation by the Master
Servicer of any other of the transactions herein contemplated, and
the fulfillment of or compliance with the terms hereof are in the
ordinary course of business of the Master Servicer and will not (A)
result in a breach of any term or provision of charter and by-laws
of the Master Servicer or (B) conflict with, result in a breach,
violation or acceleration of, or result in a default under, the
terms of any other material agreement or instrument to which the
Master Servicer is a party or by which it may be bound, or any
statute, order or regulation applicable to the Master Servicer of
any court, regulatory body, administrative agency or governmental
body having jurisdiction over the Master Servicer; and the Master
Servicer is not a party to, bound by, or in breach or violation of
any indenture or other agreement or instrument, or subject to or in
violation of any statute, order or regulation of any court,
regulatory body, administrative agency or governmental body having
jurisdiction over it, which materially and adversely affects or, to
the Master Servicer’s knowledge, would in the future
materially and adversely affect, (x) the ability of the Master
Servicer to perform its obligations under this Agreement or (y) the
business, operations, financial condition, properties or assets of
the Master Servicer taken as a whole;
(iv)
The Master Servicer does not believe, nor
does it have any reason or cause to believe, that it cannot perform
each and every covenant made by it and contained in this
Agreement;
(v)
No litigation is pending against the
Master Servicer that would materially and adversely affect the
execution, delivery or enforceability of this Agreement or the
ability of the Master Servicer to perform any of its other
obligations hereunder in accordance with the terms
hereof,
(vi)
There are no actions or proceedings
against, or investigations known to it of, the Master Servicer
before any court, administrative or other tribunal (A) that might
prohibit its entering into this Agreement, (B) seeking to prevent
the consummation of the transactions contemplated by this Agreement
or (C) that might prohibit or materially and adversely affect the
performance by the Master Servicer of its obligations under, or
validity or enforceability of, this Agreement; and
(vii)
No consent, approval, authorization or
order of any court or governmental agency or body is required for
the execution, delivery and performance by the Master Servicer of,
or compliance by the Master Servicer with, this Agreement or the
consummation by it of the transactions contemplated by this
Agreement, except for such consents, approvals, authorizations or
orders, if any, that have been obtained prior to the Closing
Date.
It is understood and agreed that the
representations, warranties and covenants set forth in this Section
2.04 shall survive the resignation or termination of the parties
hereto and the termination of this Agreement and shall inure to the
benefit of the Trustee, the Depositor and the
Certificateholders.
SECTION 2.05.
Representations, Warranties and Covenants
of the Servicer.
(a)
The Servicer hereby represents, warrants
and covenants to the Master Servicer, the Securities Administrator,
the Depositor and the Trustee, for the benefit of each of such
Persons and the Certificateholders that as of the Closing Date or
as of such date specifically provided herein:
(i)
The Servicer is a limited liability
company duly organized and validly existing under the laws of the
jurisdiction of its formation, and is duly authorized and qualified
to transact any and all business contemplated by this Agreement to
be conducted by the Servicer in any state in which a Mortgaged
Property is located or is otherwise not required under applicable
law to effect such qualification and, in any event, is in
compliance with the doing business laws of any such State, to the
extent necessary to ensure its ability to enforce each Mortgage
Loan and to service the Mortgage Loans in accordance with the terms
of this Agreement;
(ii)
The Servicer has the full power and
authority to conduct its business as presently conducted by it and
to execute, deliver and perform, and to enter into and consummate,
all transactions contemplated by this Agreement. The Servicer
has duly authorized the execution, delivery and performance of this
Agreement, has duly executed and delivered this Agreement, and this
Agreement, assuming due authorization, execution and delivery by
the other parties hereto, constitutes a legal, valid and binding
obligation of the Servicer, enforceable against it in accordance
with its terms, except as the enforceability thereof may be limited
by bankruptcy, insolvency, reorganization or similar laws affecting
the enforcement of creditors’ rights generally and by general
principles of equity;
(iii)
The execution and delivery of this
Agreement by the Servicer, the servicing of the Mortgage Loans by
the Servicer hereunder, the consummation by the Servicer of any
other of the transactions herein contemplated, and the fulfillment
of or compliance with the terms hereof are in the ordinary course
of business of the Servicer and will not (A) result in a breach of
any term or provision of the charter or by-laws of the Servicer or
(B) conflict with, result in a breach, violation or acceleration
of, or result in a default under, the terms of any other material
agreement or instrument to which the Servicer is a party or by
which it may be bound, or any statute, order or regulation
applicable to the Servicer of any court, regulatory body,
administrative agency or governmental body having jurisdiction over
the Servicer; and the Servicer is not a party to, bound by, or in
breach or violation of any indenture or other agreement or
instrument, or subject to or in violation of any statute, order or
regulation of any court, regulatory body, administrative agency or
governmental body having jurisdiction over it, which materially and
adversely affects or, to the Servicer's knowledge, would in the
future materially and adversely affect, (x) the ability of the
Servicer to perform its obligations under this Agreement, (y) the
business, operations, financial condition, properties or assets of
the Servicer taken as a whole or (z) the legality, validity or
enforceability of this Agreement;
(iv)
The Servicer does not believe, nor does
it have any reason or cause to believe, that it cannot perform each
and every covenant made by it and contained in this
Agreement;
(v)
No litigation is pending against the
Servicer that would materially and adversely affect the execution,
delivery or enforceability of this Agreement or the ability of the
Servicer to service the Mortgage Loans or to perform any of its
other obligations hereunder in accordance with the terms
hereof;
(vi)
There are no actions or proceedings
against, or investigations known to it of, the Servicer before any
court, administrative or other tribunal (A) that might prohibit its
entering into this Agreement, (B) seeking to prevent the
consummation of the transactions contemplated by this Agreement or
(C) that might prohibit or materially and adversely affect the
performance by the Servicer of its obligations under, or the
validity or enforceability of, this Agreement;
(vii)
No consent, approval, authorization or
order of any court or governmental agency or body is required for
the execution, delivery and performance by the Servicer of, or
compliance by the Servicer with, this Agreement or the consummation
by it of the transactions contemplated by this Agreement, except
for such consents, approvals, authorizations or orders, if any,
that have been obtained prior to the Closing Date;
(viii)
The Servicer has fully furnished and will
continue to fully furnish, in accordance with the Fair Credit
Reporting Act and its implementing regulations, accurate and
complete information (e.g., favorable and unfavorable) on its
borrower credit files to Equifax, Experian and Trans Union Credit
Information Company or their successors on a monthly
basis;
(ix)
The Servicer is a member of [MERS] in
good standing, and will comply in all material respects with the
rules and procedures of [MERS] in connection with the servicing of
the Mortgage Loans that are registered with [MERS]; and
(x)
The Servicer will not waive any
Prepayment Charge other than in accordance with the standard set
forth in Section 3.01.
(b)
Notwithstanding anything to the contrary
contained in this Agreement, if the covenant of the Servicer set
forth in Section 2.05(a)(x) above is breached, the Servicer will
pay the amount of such waived Prepayment Charge, from its own funds
without any right of reimbursement, for the benefit of the Holders
of the Class [__] Certificates, by depositing such amount
into the Collection Account within [___] days of the earlier of
discovery by the Servicer or receipt of notice by the Servicer of
such breach. Furthermore, notwithstanding any other provisions of
this Agreement, any payments made by the Servicer in respect of any
waived Prepayment Charges pursuant to this paragraph shall be
deemed to be paid outside of the Trust Fund.
(c)
It is understood and agreed that the
representations, warranties and covenants set forth in this Section
2.05 shall survive the resignation or termination of the parties
hereto, the termination of this Agreement and the delivery of the
Mortgage Files to the related Custodian and shall inure to the
benefit of the Trustee, the Master Servicer, the Securities
Administrator, the Depositor, the Certificateholders. Upon
discovery by any such Person or the Servicer of a breach of any of
the foregoing representations, warranties and covenants which
materially and adversely affects the value of any Mortgage Loan,
Prepayment Charge or the interests therein of the
Certificateholders, the party discovering such breach shall give
prompt written notice (but in no event later than [________] ([__])
Business Days following such discovery) to the Trustee.
Subject to Section 8.01, unless such breach shall not be
susceptible of cure within [________] ([__]) days, the obligation
of the Servicer set forth in Section 2.03(e) to cure breaches shall
constitute the sole remedy against the Servicer available to the
Certificateholders, the Depositor or the Trustee on behalf of the
Certificateholders respecting a breach of the representations,
warranties and covenants contained in this Section 2.05.
SECTION 2.06.
Issuance of the REMIC I Regular Interests
and the Class [____] Interest.
The Trustee acknowledges the assignment
to it of the Mortgage Loans and the delivery to the applicable
Custodian on its behalf of the Mortgage Loan Documents, subject to
the provisions of Section 2.01 and Section 2.02 hereof and Section
2 of the related Custodial Agreement, together with the assignment
to it of all other assets included in REMIC I, the receipt of which
is hereby acknowledged. The interests evidenced by the Class [____]
Interest, together with the REMIC I [____________], constitute the
entire beneficial ownership interest in REMIC I. The rights
of the Holders of the Class [____] Interest and REMIC I (as holder
of the REMIC I Regular Interests) to receive distributions from the
proceeds of REMIC I in respect of the Class [____] Interest and the
REMIC I [____________], respectively, and all ownership interests
evidenced or constituted by the Class [____] and the REMIC I
[____________], shall be as set forth in this Agreement.
SECTION 2.07.
Conveyance of the REMIC I [____________];
Acceptance of REMIC II and REMIC III by the Trustee.
The Depositor, concurrently with the
execution and delivery hereof, does hereby transfer, assign, set
over and otherwise convey to the Trustee, without recourse all the
right, title and interest of the Depositor in and to the REMIC I
[____________] for the benefit of the Class [____]and REMIC II (as
holder of the REMIC I [____________]). The Trustee acknowledges
receipt of the REMIC I [____________] and declares that it holds
and will hold the same in trust for the exclusive use and benefit
of all present and future Holders of the Class [____] and REMIC II
(as holder of the REMIC I [____________]). The rights of the Holder
of the Class [____] and REMIC II (as holder of the REMIC I
[____________]) to receive distributions from the proceeds of REMIC
II in respect of the Class [____] and the REMIC II Regular
Interests, respectively, and all ownership interests evidenced or
constituted by the Class [____] and the REMIC II [____________],
shall be as set forth in this Agreement. The Class [____] and the
REMIC II [____________] shall constitute the entire beneficial
ownership interest in REMIC II. The Trustee acknowledges
receipt of the REMIC II [____________] and declares that it holds
and will hold the same in trust for the exclusive use and benefit
of all present and future Holders of the Class [____] and REMIC III
(as holder of the REMIC II [____________]). The rights of the
Holder of the Class [____] and REMIC III (as holder of the REMIC II
[____________]) to receive distributions from the proceeds of REMIC
III in respect of the Class [____] Interest and the Regular
Certificates, respectively, and all ownership interests evidenced
or constituted by the Class [____] and the Regular Certificates,
shall be as set forth in this Agreement. The Class [____] and the
Regular Certificates shall constitute the entire beneficial
ownership interest in REMIC III.
SECTION 2.08.
Issuance of Residual
Certificates.
The Trustee acknowledges the assignment
to it of the REMIC I [____________] and, concurrently therewith and
in exchange therefor, pursuant to the written request of the
Depositor executed by an officer of the Depositor, the Securities
Administrator has executed and authenticated and the Trustee has
delivered to or upon the order of the Depositor, the Class [____]
Certificates in authorized denominations. The Class [____]
Certificates evidence ownership in the Class [____], the Class
[____] and the Class [____] Interest.
SECTION 2.09.
Establishment of the Trust.
The Depositor does hereby establish,
pursuant to the further provisions of this Agreement and the laws
of the State of New York, an express trust to be known, for
convenience, as “ACE Securities Corp., [________], Series [
]” and does hereby appoint
[_________________] as Trustee in accordance with the provisions of
this Agreement.
SECTION 2.10.
Purposes and Powers of the
Trust .
The purpose of the common law trust, as
created hereunder, is to engage in the following
activities:
(a)
acquire and hold the Mortgage Loans and
the other assets of the Trust Fund and the proceeds
therefrom;
(b)
to issue the Certificates sold to the
Depositor in exchange for the Mortgage Loans;
(c)
to make payments on the
Certificates;
(d)
to engage in those activities that are
necessary, suitable or convenient to accomplish the foregoing or
are incidental thereto or connected therewith; and
(e)
subject to compliance with this
Agreement, to engage in such other activities as may be required in
connection with conservation of the Trust Fund and the making of
distributions to the Certificateholders.
The trust is hereby authorized to engage
in the foregoing activities. The Trustee shall not cause the
trust to engage in any activity other than in connection with the
foregoing or other than as required or authorized by the terms of
this Agreement while any Certificate is outstanding, and this
Section 2.10 may not be amended, without the consent of the
Certificateholders evidencing [ ]% or more of the
aggregate voting rights of the Certificates.
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE MORTGAGE LOANS; ACCOUNTS
SECTION 3.01.
The Servicer to Act as
Servicer.
From and after the Closing Date to the
Servicing Transfer Date, the [________________________] Mortgage
Loans will be serviced and administered by the Interim Servicer
pursuant to the Interim Servicing Agreement, and the Servicer will
have no responsibility to service or administer the
[________________________] Mortgage Loans, or have any other
obligation with respect to the [________________________] Mortgage
Loans during that period. On and after the Closing Date (and
with respect to the [________________________] Mortgage Loans, on
and after the Servicing Transfer Date), the Servicer shall service
and administer the Mortgage Loans on behalf of the Trust Fund and
in the best interests of and for the benefit of the
Certificateholders (as determined by the Servicer in its reasonable
judgment) in accordance with the terms of this Agreement and the
respective Mortgage Loans and all applicable laws and regulations
and, to the extent consistent with such terms, in the same manner
in which it services and administers similar mortgage loans for its
own portfolio, giving due consideration to customary and usual
standards of practice of prudent mortgage lenders and loan
servicers administering similar mortgage loans but without regard
to:
(i)
any relationship that the Servicer or any
Affiliate of the Servicer may have with the related
Mortgagor;
(ii)
the ownership of any Certificate by the
Servicer or any Affiliate of the Servicer;
(iii)
the Servicer’s obligation to make
P&I Advances or Servicing Advances; or
(iv)
the Servicer’s right to receive
compensation for its services hereunder;
provided, however, that with respect to
the [________________________] Mortgage Loans serviced pursuant to
the Interim Servicing Agreement, the Servicer will be entitled to
seek indemnification in accordance with Section 7.03 hereof for any
liability attributable to it as a result of the acts
and omissions of the Interim Servicer or the failure of the Interim
Servicer to service the [________________________] Mortgage Loans
in accordance with the Interim Servicing Agreement prior to the
Servicing Transfer Date.
To the extent consistent with the
foregoing, the Servicer shall also seek to maximize the timely and
complete recovery of principal and interest on the Mortgage Notes
and shall waive (or permit a Sub-Servicer to waive) a Prepayment
Charge only under the following circumstances: (i) such waiver is
standard and customary in servicing similar Mortgage Loans and such
waiver is related to a default or reasonably foreseeable default
and would, in the reasonable judgment of the Servicer, maximize
recovery of total proceeds taking into account the value of such
Prepayment Charge and the related Mortgage Loan and, if such waiver
is made in connection with a refinancing of the related Mortgage
Loan, such refinancing is related to a default or a reasonably
foreseeable default, (ii) such Prepayment Charge is unenforceable
in accordance with applicable law or the collection of such related
Prepayment Charge would otherwise violate applicable law or (iii)
the collection of such Prepayment Charge would be considered
“predatory” pursuant to written guidance published or
issued by any applicable federal, state or local regulatory
authority acting in its official capacity and having jurisdiction
over such matters. Notwithstanding any provision in this
Agreement to the contrary, in the event the Prepayment Charge
payable under the terms of the Mortgage Note is less than the
amount of the Prepayment Charge set forth in the Prepayment Charge
Schedule or other information provided to the Servicer, such
Servicer shall not have any liability or obligation with respect to
such difference, and in addition shall not have any liability or
obligation to pay the amount of any uncollected Prepayment Charge
if the failure to collect such amount is the direct result of
inaccurate or incomplete information on the Prepayment Charge
Schedule.
Subject only to the above-described
servicing standards (the “Accepted Servicing
Practices”) and the terms of this Agreement and of the
related Mortgage Loans, the Servicer shall have full power and
authority, to do or cause to be done any and all things in
connection with such servicing and administration which it may deem
necessary or desirable with the goal of maximizing proceeds of the
Mortgage Loan. Without limiting the generality of the
foregoing, the Servicer in its own name is hereby authorized and
empowered by the Trustee when the Servicer believes it appropriate
in its best judgment, to execute and deliver, on behalf of the
Trust Fund, the Certificateholders and the Trustee or any of them,
and upon written notice to the Trustee, any and all instruments of
satisfaction or cancellation, or of partial or full release or
discharge or subordination, and all other comparable instruments,
with respect to the related Mortgage Loans and the related
Mortgaged Properties and to institute foreclosure proceedings or
obtain a deed-in-lieu of foreclosure so as to convert the ownership
of such properties, and to hold or cause to be held title to such
properties, on behalf of the Trustee, for the benefit of the Trust
Fund and the Certificateholders. The Servicer shall service and
administer the related Mortgage Loans in accordance with applicable
state and federal law and shall provide to the Mortgagors any
reports required to be provided to them thereby. The Servicer shall
also comply in the performance of this Agreement with all
reasonable rules and requirements of each insurer under any
standard hazard insurance policy. Subject to Section 3.14, the
Trustee shall execute, at the written request of the Servicer, and
furnish to the Servicer a power of attorney in the form of Exhibit
D hereto and other documents necessary or appropriate to enable the
Servicer to carry out its servicing and administrative duties
hereunder and furnished to the Trustee by the Servicer, and the
Trustee shall not be liable for the actions of the Servicer under
such powers of attorney and shall be indemnified by the Servicer
for any cost, liability or expense incurred by the Trustee in
connection with the Servicer’s use or misuse of any such
power of attorney.
In accordance with Accepted Servicing
Practices, the Servicer shall make or cause to be made Servicing
Advances as necessary for the purpose of effecting the payment of
taxes and assessments on the Mortgaged Properties, which Servicing
Advances shall be reimbursable in the first instance from related
collections from the related Mortgagors pursuant to
Section 3.07, and further as provided in Section 3.09;
provided, however, the Servicer shall only make such Servicing
Advance if the related Mortgagor has not made such payment and if
the failure to make such Servicing Advance would result in the loss
of the related Mortgaged Property due to a tax sale or foreclosure
as result of a tax lien. Any cost incurred by the Servicer in
effecting the payment of taxes and assessments on a Mortgaged
Property shall not, for the purpose of calculating the Stated
Principal Balance of such Mortgage Loan or distributions to
Certificateholders, be added to the unpaid principal balance of the
related Mortgage Loan, notwithstanding that the terms of such
Mortgage Loan so permit. The parties to this Agreement
acknowledge that Servicing Advances shall be reimbursable pursuant
to Section 3.09 of this Agreement, and agree that no Servicing
Advance shall be rejected or disallowed by any party unless it has
been shown that such Servicing Advance was not made in accordance
with the terms of this Agreement . Notwithstanding the foregoing, the
parties understand and agree that, with respect to any Mortgage
Loan (1) the Master Servicer shall not approve the reimbursement of
any Servicing Advance made with respect to such Mortgage Loan prior
to the Cut-off Date (each, a “Pre-Cut-off Date
Advance”) unless and until it has received a Servicing
Advance Schedule listing the amount of Pre-Cut-off Date Advances
made in respect of such Mortgage Loan from (a) the Servicer or the
Interim Servicer with respect to any Mortgage Loans that were
transferred to such Servicer or Interim Servicer prior to the
Cut-off Date and/or (b) the Depositor with respect to any Mortgage
Loans that were transferred to the Servicer or Interim Servicer
after the Cut-off Date, as applicable, (2) the aggregate
Pre-Cut-off Date Advances reimbursable hereunder with respect to
such Mortgage Loan shall not exceed the amount of Pre-Cut-off Date
Advances for such Mortgage Loan shown on the Servicing Advance
Schedule delivered to the Master Servicer, (3) the Depositor shall
be deemed to have agreed with and approved the Pre-Cut-off Date
Advances shown on any Servicing Advance Schedule furnished to the
Master Servicer, and (4) the Master Servicer will have no liability
to the Depositor, the Servicer or any other Person, including any
Certificateholder, for approving reimbursement of related
Pre-Cut-off Date Advances so long as the aggregate amount of such
advances reimbursed hereunder does not exceed of the amount of
Pre-Cut-off Date Advances for such Mortgage Loan shown on the
Servicing Advance Schedule.
Notwithstanding anything in this
Agreement to the contrary, the Servicer may not make any future
advances with respect to a Mortgage Loan and the Servicer shall not
permit any modification with respect to any related Mortgage Loan
that would change the Mortgage Rate, reduce or increase the
principal balance (except for reductions resulting from actual
payments of principal) or change the final maturity date on such
related Mortgage Loan (unless, as provided in Section 3.06, the
related Mortgagor is in default with respect to the related
Mortgage Loan or such default is, in the judgment of the Servicer,
reasonably foreseeable) or any modification, waiver or amendment of
any term of any related Mortgage Loan that would both (A) effect an
exchange or reissuance of such Mortgage Loan under Section 1001 of
the Code (or final, temporary or proposed Treasury regulations
promulgated thereunder) and (B) cause any Trust REMIC created
hereunder to fail to qualify as a REMIC under the Code or the
imposition of any tax on “prohibited transactions” or
“contributions after the startup date” under the REMIC
Provisions.
In the event that the Mortgage Loan
Documents relating to a Mortgage Loan contain provisions requiring
the related Mortgagor to arbitrate disputes (at the option of the
Trustee, on behalf of the Trust), the Trustee hereby authorizes the
Servicer to waive the Trustee’s right or option to arbitrate
disputes and to send written notice of such waiver to the
Mortgagor, although the Mortgagor may still require arbitration at
its option.
From and after the Servicing Transfer
Date, the Servicer will fully furnish, in accordance with the Fair
Credit Reporting Act and its implementing regulations, accurate and
complete information (e.g., favorable and unfavorable) on its
borrower credit files to Equifax, Experian and Trans Union Credit
Information Company or their successors on a monthly
basis.
SECTION 3.02.
Sub-Servicing Agreements Between the
Servicer and Sub-Servicers.
The Servicer may arrange for the
subservicing of any Mortgage Loan by a Sub- Servicer pursuant to a
Sub-Servicing Agreement; provided that such sub-servicing
arrangement and the terms of the related Sub-Servicing Agreement
must provide for the servicing of such Mortgage Loans in a manner
consistent with the servicing arrangements contemplated hereunder.
Each Sub-Servicer shall be (i) authorized to transact
business in the state or states where the related Mortgaged
Properties it is to service are situated, if and to the extent
required by applicable law to enable the Sub-Servicer to perform
its obligations hereunder and under the Sub-Servicing Agreement and
(ii) a Freddie Mac or Fannie Mae approved mortgage servicer.
Notwithstanding the provisions of any Sub-Servicing
Agreement, any of the provisions of this Agreement relating to
agreements or arrangements between the Servicer or a Sub-Servicer
or reference to actions taken through the Servicer 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 in accordance with the
provisions of this Agreement without diminution of such obligation
or liability by virtue of such Sub-Servicing Agreements or
arrangements or by virtue of indemnification from the Sub-Servicer
and to the same extent and under the same terms and conditions as
if the Servicer alone were servicing and administering the Mortgage
Loans. Every Sub-Servicing Agreement entered into by the Servicer
shall contain a provision giving the successor servicer the option
to terminate such agreement in the event a successor servicer is
appointed. All actions of each Sub-Servicer performed
pursuant to the related Sub-Servicing Agreement shall be performed
as an agent of the Servicer with the same force and effect as if
performed directly by the Servicer.
For purposes of this Agreement, the
Servicer shall be deemed to have received any collections,
recoveries or payments with respect to the Mortgage Loans that are
received by a Sub-Servicer regardless of whether such payments are
remitted by the Sub-Servicer to the Servicer. For purposes of
this Agreement, the [ ]Assignment Agreement
and the Interim Servicing Agreement shall not be deemed to be
Sub-Servicing Agreements.
SECTION 3.03.
Successor Sub-Servicers.
Any Sub-Servicing Agreement shall provide
that the Servicer shall be entitled to terminate any Sub-Servicing
Agreement and to either itself directly service the related
Mortgage Loans or enter into a Sub-Servicing Agreement with a
successor Sub-Servicer which qualifies under Section 3.02.
Any Sub-Servicing Agreement shall include the provision that
such agreement may be immediately terminated by any successor to
the Servicer (which may be the Master Servicer) without fee, in
accordance with the terms of this Agreement, in the event that the
Servicer (or any successor to the Servicer) shall, for any reason,
no longer be the Servicer of the related Mortgage Loans (including
termination due to a Servicer Event of Default).
SECTION 3.04.
No Contractual Relationship Between
Sub-Servicer, Trustee or the Certificateholders.
Any Sub-Servicing Agreement and any other
transactions or services relating to the Mortgage Loans involving a
Sub-Servicer shall be deemed to be between the Sub-Servicer and the
Servicer alone and the Master Servicer, Trustee and the
Certificateholders shall not be deemed parties thereto and shall
have no claims, rights, obligations, duties or liabilities with
respect to any Sub-Servicer except as set forth in Section
3.05.
SECTION 3.05.
Assumption or Termination of
Sub-Servicing Agreement by Successor Servicer.
In connection with the assumption of the
responsibilities, duties and liabilities and of the authority,
power and rights of the Servicer hereunder by a successor servicer
(which may be the Master Servicer) pursuant to Section 8.02, it is
understood and agreed that the Servicer’s rights and
obligations under any Sub-Servicing Agreement then in force between
the Servicer and a Sub-Servicer shall be assumed simultaneously by
such successor servicer without act or deed on the part of such
successor servicer; provided, however, that any successor servicer
may terminate the Sub-Servicer.
The Servicer shall, upon the reasonable
request of the Master Servicer, but at its own expense, deliver to
the assuming party documents and records relating to each
Sub-Servicing Agreement and an accounting of amounts collected and
held by it and otherwise use its best efforts to effect the orderly
and efficient transfer of the Sub-Servicing Agreements to the
assuming party.
The Servicing Fee payable to any such
successor servicer shall be payable from payments received on the
Mortgage Loans in the amount and in the manner set forth in this
Agreement.
SECTION 3.06.
Collection of Certain Mortgage Loan
Payments.
The Servicer shall make reasonable
efforts to collect all payments called for under the terms and
provisions of the related Mortgage Loans, and shall, to the extent
such procedures shall be consistent with this Agreement and
Accepted Servicing Practices, follow such collection procedures as
it would follow with respect to mortgage loans comparable to the
Mortgage Loans and held for its own account. Consistent with the
foregoing, the Servicer may in its discretion (i) waive any late
payment charge or, if applicable, penalty interest or (ii) extend
the due dates for the Monthly Payments due on a Mortgage Note
related to a Mortgage Loan for a period of not greater than [___]
days; provided that any extension pursuant to this clause shall not
affect the amortization schedule of any Mortgage Loan for purposes
of any computation hereunder. Notwithstanding the foregoing, in the
event that any Mortgage Loan is in default or, in the judgment of
the Servicer, such default is reasonably foreseeable, the Servicer,
consistent with Accepted Servicing Practices may waive, modify or
vary any term of such Mortgage Loan (including modifications that
change the Mortgage Rate, forgive the payment of principal or
interest or extend the final maturity date of such Mortgage Loan),
accept payment from the related Mortgagor of an amount less than
the Stated Principal Balance in final satisfaction of such Mortgage
Loan, or consent to the postponement of strict compliance with any
such term or otherwise grant indulgence to any Mortgagor if in the
Servicer’s determination such waiver, modification,
postponement or indulgence is not materially adverse to the
interests of the Certificateholders (taking into account any
estimated Realized Loss that might result absent such
action).
Payments on the Mortgage Loans, including
any payoffs, made in accordance with the related Mortgage File will
be entered in the Master Servicer’s set of books and records
no more than two business days after receipt and identification,
and allocated to principal or interest as specified in the related
Mortgage File.
SECTION 3.07.
Collection of Taxes, Assessments and
Similar Items; Servicing Accounts.
To the extent the terms of a Mortgage
provide for Escrow Payments, the Servicer shall establish and
maintain one or more accounts (the “Servicing
Accounts”), into which all collections from the Mortgagors
(or related advances from Sub-Servicers) for the payment of taxes,
assessments, fire, flood, and hazard insurance premiums, and
comparable items for the account of the Mortgagors (“Escrow
Payments”) shall be deposited and retained. Servicing
Accounts shall be Eligible Accounts. The Servicer shall
deposit in the clearing account in which it customarily deposits
payments and collections on mortgage loans in connection with its
mortgage loan servicing activities on a daily basis, and in no
event more than one Business Day after the Servicer’s receipt
thereof, all Escrow Payments collected on account of the Mortgage
Loans and shall thereafter deposit such Escrow Payments in the
Servicing Accounts, in no event later than the second Business Day
after the deposit of good funds into the clearing account, and
retain therein, all Escrow Payments collected on account of the
Mortgage Loans, for the purpose of effecting the timely payment of
any such items as required under the terms of this Agreement.
Withdrawals of amounts from a Servicing Account may be made only to
(i) effect timely payment of taxes, assessments, fire, flood, and
hazard insurance premiums, and comparable items; (ii) reimburse
itself out of related collections for any Servicing Advances made
pursuant to Section 3.01 (with respect to taxes and assessments)
and Section 3.11 (with respect to fire, flood and hazard
insurance); (iii) refund to Mortgagors any sums as may be
determined to be overages; (iv) pay interest, if required and as
described below, to Mortgagors on balances in the Servicing
Account; or, only to the extent not required to be paid to the
related Mortgagors, to pay itself interest on balances in the
Servicing Account; or (v) clear and terminate the Servicing Account
at the termination of the Servicer’s obligations and
responsibilities in respect of the Mortgage Loans under this
Agreement in accordance with Article X. As part of its servicing
duties, the Servicer shall pay to the Mortgagors interest on funds
in Servicing Accounts, to the extent required by law and, to the
extent that interest earned on funds in the Servicing Accounts is
insufficient, to pay such interest from its own funds, without any
reimbursement therefor. Notwithstanding the foregoing, the Servicer
shall not be obligated to collect Escrow Payments if the related
Mortgage Loan does not require such payments but the Servicer shall
nevertheless be obligated to make Servicing Advances as provided in
Section 3.01 and Section 3.11. In the event the Servicer shall
deposit in the Servicing Accounts any amount not required to be
deposited therein, it may at any time withdraw such amount from the
Servicing Accounts, any provision to the contrary
notwithstanding.
To the extent that a Mortgage does not
provide for Escrow Payments, the Servicer (i) shall determine
whether any such payments are made by the Mortgagor in a manner and
at a time that is necessary to avoid the loss of the Mortgaged
Property due to a tax sale or the foreclosure as a result of a tax
lien and (ii) shall ensure that all insurance required to be
maintained on the Mortgaged Property pursuant to this Agreement is
maintained. If any such payment has not been made and the
Servicer receives notice of a tax lien with respect to the Mortgage
Loan being imposed, the Servicer shall, promptly and to the extent
required to avoid loss of the Mortgaged Property, advance or cause
to be advanced funds necessary to discharge such lien on the
Mortgaged Property unless the Servicer determines the advance to be
nonrecoverable. The Servicer assumes full responsibility for
the payment of all such bills and shall effect payments of all such
bills irrespective of the Mortgagor’s faithful performance in
the payment of same or the making of the Escrow Payments and shall
make Servicing Advances to effect such payments subject to its
determination of recoverability.
SECTION 3.08.
Collection Account and Distribution
Account.
(a)
On behalf of the Trust Fund, the Servicer
shall establish and maintain one or more “Collection
Accounts”, held in trust for the benefit of the Trustee and
the Certificateholders. On behalf of the Trust Fund, the
Servicer shall deposit or cause to be deposited in the clearing
account in which it customarily deposits payments and collections
on mortgage loans in connection with its mortgage loan servicing
activities on a daily basis, and in no event more than one Business
Day after the Servicer’s receipt thereof, and shall
thereafter deposit in the Collection Account, in no event later
than [ ] Business Days after the deposit of good funds
into the clearing account, as and when received or as otherwise
required hereunder, the following payments and collections received
or made by it on or subsequent to the Cut-off Date other than
amounts attributable to a Due Date on or prior to the Cut-off
Date:
(i)
all payments on account of principal,
including Principal Prepayments, on the Mortgage Loans;
(ii)
all payments on account of interest (net
of the related Servicing Fee and any Prepayment Interest Excess) on
each Mortgage Loan;
(iii)
all Insurance Proceeds and Liquidation
Proceeds (other than proceeds collected in respect of any
particular REO Property) and all Subsequent Recoveries with respect
to the Mortgage Loans;
(iv)
any amounts required to be deposited by
the Servicer pursuant to Section 3.10 in connection with any losses
realized on Permitted Investments with respect to funds held in the
Collection Account;
(v)
any amounts required to be deposited by
the Servicer pursuant to the second paragraph of Section 3.11(a) in
respect of any blanket policy deductibles;
(vi)
any Purchase Price or Substitution
Shortfall Amount delivered to the Servicer and all proceeds (net of
amounts payable or reimbursable to the Servicer, the Master
Servicer, the Trustee, the Custodians or the Securities
Administrator) of Mortgage Loans purchased in accordance with
Section 2.03, Section 3.13 or Section 10.01; and
(vii)
any Prepayment Charges collected by the
Servicer in connection with the Principal Prepayment of any of the
Mortgage Loans or amounts required to be deposited by the Servicer
in connection with a breach of its obligations under Section
2.05.
The foregoing requirements for deposit in
the Collection Account shall be exclusive, it being understood and
agreed that, without limiting the generality of the foregoing,
payments in the nature of late payment charges, assumption fees or
other similar fees need not be deposited by the Servicer in the
Collection Account and may be retained by the Servicer as
additional compensation. In the event the Servicer shall
deposit in the Collection Account any amount not required to be
deposited therein, it may at any time withdraw such amount from the
Collection Account, any provision herein to the contrary
notwithstanding.
(b)
On behalf of the Trust Fund, the
Securities Administrator shall establish and maintain one or more
accounts (such account or accounts, the “Distribution
Account”), held in trust for the benefit of the Trustee, the
Trust Fund and the Certificateholders. On behalf of the Trust Fund,
the Servicer shall deliver to the Securities Administrator in
immediately available funds for deposit in the Distribution Account
on or before 12:00 noon New York time on the Servicer Remittance
Date, that portion of the Available Distribution Amount (calculated
without regard to the references in clause (2) of the definition
thereof to amounts that may be withdrawn from the Distribution
Account) for the related Distribution Date then on deposit in the
Collection Account and the amount of all Prepayment Charges
collected by the Servicer in connection with the Principal
Prepayment of any of the Mortgage Loans then on deposit in the
Collection Account and the amount of any funds reimbursable to an
Advance Financing Person pursuant to Section 3.25. If the
balance on deposit in a Collection Account exceeds $[____________]
as of the commencement of business on any Business Day and the
Collection Account constitutes an Eligible Account solely pursuant
to clause (ii) of the definition of “Eligible Account,”
the Servicer shall, on or before 5:00 p.m. New York time on such
Business Day, withdraw from the Collection Account any and all
amounts payable or reimbursable to the Depositor, the Servicer, the
Trustee, the Master Servicer, the Securities Administrator or the
Seller pursuant to Section 3.09 and shall pay such amounts to the
Persons entitled thereto or shall establish a separate Collection
Account (which shall also be an Eligible Account) and withdraw from
the existing Collection Account the amount on deposit therein in
excess of $[____________] and deposit such excess in the newly
created Collection Account.
With respect to any remittance received
by the Securities Administrator on the Servicer Remittance Date on
which such payment was due, the Securities Administrator shall send
written notice thereof to the Servicer. The Servicer shall pay to
the Securities Administrator interest on any such late payment by
the Servicer at an annual rate equal to Prime Rate (as defined in
The Wall Street Journal ) plus [ ]
percentage point, but in no event greater than the maximum amount
permitted by applicable law. Such interest shall be paid by
the Servicer to the Securities Administrator on the date such late
payment is made and shall cover the period commencing with the day
following such Servicer Remittance Date and ending with the
Business Day on which such payment is made, both inclusive.
The payment by the Servicer
