EXECUTION COPY
GS MORTGAGE SECURITIES CORP.,
Depositor,
LITTON LOAN SERVICING LP,
Servicer,
WELLS FARGO BANK, N.A.,
Custodian,
and
DEUTSCHE BANK NATIONAL TRUST COMPANY,
Trustee
--------------------------------------
POOLING AND SERVICING AGREEMENT
Dated as of December 1, 2005
--------------------------------------
GSAMP TRUST 2005-WMC3
MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2005-WMC3
<PAGE>
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
Section 1.01
Definitions...................................................
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
Section 2.01
Conveyance of Mortgage Loans..................................
Section 2.02
Acceptance by the Trustee of the Mortgage Loans...............
Section 2.03
Representations, Warranties and Covenants of the Servicer
and the Custodian............................................
Section 2.04
Non-Qualified Mortgages.......................................
Section 2.05 Execution
and Delivery of Certificates........................
Section 2.06 REMIC
Matters.................................................
Section 2.07
Representations and Warranties of the Depositor...............
Section 2.08
Enforcement of Obligations for Breach of Mortgage Loan
Representations..............................................
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01 Servicer
to Service Mortgage Loans............................
Section 3.02
Subservicing Agreements between the Servicer and
Subservicers.................................................
Section 3.03 Successor
Subservicers........................................
Section 3.04 Liability
of the Servicer.....................................
Section 3.05 No
Contractual Relationship between Subservicers and the
Trustee......................................................
Section 3.06
Assumption or Termination of Subservicing Agreements by
Trustee......................................................
Section 3.07
Collection of Certain Mortgage Loan Payments..................
Section 3.08
Subservicing Accounts.........................................
Section 3.09
Collection of Taxes, Assessments and Similar Items;
Escrow Accounts..............................................
Section 3.10
Collection Account............................................
Section 3.11
Withdrawals from the Collection Account.......................
Section 3.12
Investment of Funds in the Collection Account and the
Distribution Account.........................................
Section 3.13
Maintenance of Hazard Insurance, Errors and Omissions and
Fidelity Coverage............................................
Section 3.14
Enforcement of Due-on-Sale Clauses; Assumption Agreements.....
Section 3.15
Realization upon Defaulted Mortgage Loans.....................
Section 3.16 Release
of Mortgage Files.....................................
Section 3.17 Title,
Conservation and Disposition of REO Property...........
Section 3.18
Notification of Adjustments...................................
Section 3.19 Access to
Certain Documentation and Information Regarding
the Mortgage Loans...........................................
Section 3.20
Documents, Records and Funds in Possession of the
Servicer to Be Held for the Trustee..........................
Section 3.21 Servicing
Compensation........................................
Section 3.22 Annual
Statement as to Compliance.............................
Section 3.23 Annual
Independent Public Accountants' Servicing
Statement; Financial Statements..............................
Section 3.24 Trustee
to Act as Servicer....................................
Section 3.25
Compensating Interest.........................................
Section 3.26 Credit
Reporting; Gramm-Leach-Bliley Act......................
Section 3.27 Excess
Reserve Fund Account; Distribution Account.............
Section 3.28 Optional
Purchase of Delinquent Mortgage Loans................
ARTICLE IV
DISTRIBUTIONS AND
ADVANCES BY THE SERVICER
Section 4.01
Advances......................................................
Section 4.02
Priorities of Distribution....................................
Section 4.03 Monthly
Statements to Certificateholders......................
Section 4.04 Certain
Matters Relating to the Determination of LIBOR........
Section 4.05
Allocation of Applied Realized Loss Amounts...................
ARTICLE V
THE CERTIFICATES
Section 5.01 The
Certificates..............................................
Section 5.02
Certificate Register; Registration of Transfer and
Exchange of Certificates.....................................
Section 5.03
Mutilated, Destroyed, Lost or Stolen Certificates.............
Section 5.04 Persons
Deemed Owners.........................................
Section 5.05 Access to
List of Certificateholders' Names and Addresses.....
Section 5.06
Maintenance of Office or Agency...............................
ARTICLE VI
THE DEPOSITOR AND THE SERVICER
Section 6.01 Respective Liabilities of the Depositor and the
Servicer......8
Section 6.02 Merger or Consolidation of the Depositor or the
Servicer......8
Section 6.03 Limitation on Liability of the Depositor, the
Servicer
and Others...................................................
Section 6.04
Limitation on Resignation of the Servicer.....................
Section 6.05
Additional Indemnification by the Servicer; Third Party
Claims.......................................................
Section 6.06 Servicing
Rights Pledge.......................................
ARTICLE VII
DEFAULT
Section 7.01 Events of
Default.............................................
Section 7.02 Trustee
to Act; Appointment of Successor......................
Section 7.03
Notification to Certificateholders............................
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.01 Duties of
the Trustee.........................................
Section 8.02 Certain
Matters Affecting the Custodian and the Trustee.......
Section 8.03 Trustee
Not Liable for Certificates or Mortgage Loans.........
Section 8.04 Trustee
May Own Certificates..................................
Section 8.05 Trustee's
Fees and Expenses...................................
Section 8.06
Eligibility Requirements for the Trustee......................
Section 8.07
Resignation and Removal of the Trustee........................
Section 8.08 Successor
Trustee.............................................
Section 8.09 Merger or
Consolidation of the Trustee........................
Section 8.10
Appointment of Co-Trustee or Separate Trustee.................
Section 8.11 Tax
Matters...................................................
Section 8.12 Periodic
Filings..............................................
Section 8.13 Tax
Classification of the Excess Reserve Fund Account.........
Section 8.14 Custodial
Responsibilities....................................
Section 8.15
Limitations on Custodial Responsibilities.....................
ARTICLE IX
TERMINATION
Section 9.01
Termination upon Liquidation or Purchase of the Mortgage
Loans........................................................
Section 9.02 Final
Distribution on the Certificates........................
Section 9.03
Additional Termination Requirements...........................
ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.01
Amendment.....................................................
Section 10.02 Recordation of Agreement;
Counterparts........................
Section 10.03 Governing
Law.................................................
Section 10.04 Intention of
Parties..........................................
Section 10.05
Notices.......................................................
Section 10.06 Severability of
Provisions....................................
Section 10.07 Assignment; Sales; Advance
Facilities.........................
Section 10.08 Limitation on Rights of
Certificateholders....................
Section 10.09 Inspection and Audit
Rights...................................
Section 10.10 Certificates Nonassessable and Fully
Paid.....................
Section 10.11 Waiver of Jury
Trial..........................................
Section 10.12 Limitation of
Damages.........................................
SCHEDULES
Schedule I
Mortgage Loan Schedule
Schedule II
Representations and Warranties of Litton Loan Servicing LP
Schedule III
Representations and Warranties of Wells Fargo Bank, N.A., as
Custodian
EXHIBITS
Exhibit A Form of Class A,
Class M and Class B Certificates
Exhibit B Form of Class P
Certificate
Exhibit C-1 Form
of Class R-1 Certificate
Exhibit C-2 Form
of R-2 Certificate
Exhibit D Form of Class X
Certificate
Exhibit E Form of Initial
Certification of Custodian
Exhibit F Form of Document
Certification and Exception Report of Custodian
Exhibit G Form of Residual
Transfer Affidavit
Exhibit H Form of
Transferor Certificate
Exhibit I Form of Rule
144A Letter
Exhibit J Form of
Investment Letter (Non-Rule 144A)
Exhibit K Form of Request
for Release
Exhibit L Form of Contents
of Each Mortgage File
Exhibit M Form of
Certification to be provided with Form 10-K
Exhibit N Form of Trustee
Certification to be provided to Depositor
Exhibit O Form of Servicer
Certification to be provided to Depositor
Exhibit P
Form of Power of
Attorney
Exhibit Q Underlying
Agreements
<PAGE>
THIS POOLING AND SERVICING AGREEMENT, dated as of December 1,
2005,
among GS MORTGAGE SECURITIES CORP., a Delaware corporation (the
"Depositor"),
LITTON LOAN SERVICING LP, a Delaware limited partnership
("Litton"), WELLS FARGO
BANK, N.A., a national banking association (the "Custodian"), and
DEUTSCHE BANK
NATIONAL TRUST COMPANY, a national banking association (the
"Trustee"),
W I T N E S S E T H:
In consideration of the mutual agreements herein contained, the
parties hereto agree as follows:
PRELIMINARY STATEMENT
The Trustee shall elect that six segregated asset pools within
the
Trust Fund be treated for federal income tax purposes as comprising
six REMICs
(each, a "Trust REMIC" or, in the alternative, the Lower Tier
REMIC, the Upper
Tier REMIC, the Class B-1 REMIC, the Class B-2 REMIC, the Class B-3
REMIC and
the Class X REMIC, respectively). The Class X Regular Interest and
each Class of
LIBOR Certificates (other than the right of each Class of LIBOR
Certificates to
receive Basis Risk Carry Forward Amounts) represents ownership of a
regular
interest in a Trust REMIC for purposes of the REMIC Provisions. The
Class R-1
Certificates represent ownership of the sole class of residual
interest in each
of the Lower Tier REMIC and the Upper Tier REMIC, and the Class R-2
Certificates
represent ownership of the sole class of residual interest in each
of the Class
B-1 REMIC, the Class B-2 REMIC, the Class B-3 REMIC and the Class X
REMIC for
purposes of the REMIC Provisions. The Start-up Day for each REMIC
described
herein is the Closing Date. The latest possible maturity date for
each
Certificate is the latest date referenced in Section 2.06. The
Upper Tier REMIC
shall hold as assets the several classes of uncertificated Lower
Tier Regular
Interests, set out below. The Lower Tier REMIC shall hold as assets
the assets
described in the definition of "Trust Fund" herein (other than the
Excess
Reserve Fund Account and the Corridor Agreements). Each such Lower
Tier Regular
Interest is hereby designated as a regular interest in the Lower
Tier REMIC. The
Class LT-A-1A, Class LT-A-1B, Class LT-A-2A, Class LT-A-2B, Class
LT-A-2C, Class
LT-M-1, Class LT-M-2, Class LT-M-3, Class LT-M-4, Class LT-M-5,
Class LT-M-6,
Class LT-B-1, Class LT-B-2 and Class LT-B-3 Interests are hereby
designated the
LT-Accretion Directed Classes (the "LT-Accretion Directed
Classes").
The Class B-1 REMIC shall hold as an asset the Class B-1
Interest
issued by the Upper Tier REMIC, the Class B-1 Certificates shall
represent
ownership of the regular interest issued by the Class B-1 REMIC and
the Class
B1-R Interest shall represent the sole class residual interest in
the Class B-1
REMIC.
The Class B-2 REMIC shall hold as an asset the Class B-2
Interest
issued by the Upper Tier REMIC, the Class B-2 Certificates shall
represent
ownership of the regular interest issued by the Class B-2 REMIC and
the Class
B2-R Interest shall represent the sole class residual interest in
the Class B-2
REMIC.
The Class B-3 REMIC shall hold as an asset the Class B-3
Interest
issued by the Upper Tier REMIC, the Class B-3 Certificates shall
represent
ownership of the regular interest issued by the Class B-3 REMIC and
the Class
B3-R Interest shall represent the sole class residual interest in
the Class B-3
REMIC.
The Class X REMIC shall hold as an asset the Class UT-X
Interest
issued by the Upper Tier REMIC, the Class X Regular Interest shall
represent the
regular interest issued by the Class X REMIC and the Class X-R
Interest shall
represent the sole class residual interest in the Class X REMIC.
The Class X
Certificates also represent beneficial ownership of the Class X
Regular
Interest, the Excess Reserve Fund Account and the Corridor
Agreements.
Each LIBOR Certificate represents a beneficial ownership of a
regular interest in a Trust REMIC and the right to receive Basis
Risk Carry
Forward Amounts, and the Class P Certificates represent beneficial
ownership of
Prepayment Premiums, which portions of the Trust Fund shall be
treated as a
grantor trust.
Lower-Tier REMIC
Corresponding
Upper Tier
Lower Tier
Lower Tier
Initial Lower Tier Principal REMIC Regular
Regular Interest Interest Rate
Amount
Interest
---------------
-------------
------------------------------ --------------
Class LT-A-1A
(1) 1/2
initial Class Certificate
A-1A
Balance of Corresponding Upper
Tier REMIC Regular Interest
Class LT-A-1B
(1) 1/2
initial Class Certificate
A-1B
Balance of Corresponding Upper
Tier REMIC Regular Interest
Class LT-A-2A
(1) 1/2
initial Class Certificate
A-2A
Balance of Corresponding Upper
Tier REMIC Regular Interest
Class LT-A-2B
(1) 1/2
initial Class Certificate
A-2B
Balance of Corresponding Upper
Tier REMIC Regular Interest
Class LT-A-2C
(1) 1/2
initial Class Certificate
A-2C
Balance of Corresponding Upper
Tier REMIC Regular Interest
Class LT-M-1
(1) 1/2
initial Class Certificate
M-1
Balance of Corresponding Upper
Tier REMIC Regular Interest
Class LT-M-2
(1) 1/2
initial Class Certificate
M-2
Balance of Corresponding Upper
Tier REMIC Regular Interest
Class LT-M-3
(1) 1/2
initial Class Certificate
M-3
Balance of Corresponding Upper
Tier REMIC Regular Interest
Class LT-M-4
(1) 1/2
initial Class Certificate
M-4
Balance of Corresponding Upper
Tier REMIC Regular Interest
Class LT-M-5
(1) 1/2
initial Class Certificate
M-5
Balance of Corresponding Upper
Tier REMIC Regular Interest
Class LT-M-6
(1) 1/2
initial Class Certificate
M-6
Balance of Corresponding Upper
Tier REMIC Regular
Interest
Class LT-B-1
(1) 1/2
initial Class Certificate
B-1
Balance of Corresponding Upper
Tier REMIC Regular Interest
Class LT-B-2
(1) 1/2
initial Class Certificate
B-2
Balance of Corresponding Upper
Tier REMIC Regular Interest
Class LT-B-3
(1) 1/2
initial Class Certificate
B-3
Balance of Corresponding Upper
Tier REMIC Regular Interest
Class LT-Group I (2)
0.001% aggregate Stated
Principal Balance of Group I
Mortgage Loans (4)
Class LT-Group
(3)
0.001% aggregate Stated
II
Principal Balance of Group II
Mortgage Loans (4)
Class LT-Accrual (1)
1/2
Pool Stated Principal Balance
plus 1/2 Overcollateralized
Amount, less aggregate Initial
Lower-Tier Principal Amounts of
Class LT-Group 1 and Class
LT-Group II Interests
Class LT-R
(5)
(5)
------------
(1) The interest
rate with respect to any Distribution Date for these
interests
is a per annum variable rate equal to the WAC Cap.
(2) The interest
rate with respect to any Distribution Date for the Class LT
Group I
Interest is a per annum variable rate (expressed as a
percentage
rounded to
eight decimal places) equal to the Loan Group I Cap.
(3) The interest
rate with respect to any Distribution Date for the Class LT
Group II
Interest is a per annum variable rate (expressed as a
percentage
rounded to
eight decimal places) equal to the Loan Group II Cap.
(4) For all
Distribution Dates, the Lower Tier Principal Amount of these
Lower
Tier
Regular Interests shall be rounded to eight decimal places.
(5) The Class
LT-R Interest is the sole Class of residual interest in the
Lower Tier
REMIC and it does not have a principal amount or an interest
rate.
The Lower Tier REMIC shall hold as assets all of the assets
included
in definition of "Trust Fund" other than the Excess Reserve Fund
Account, the
Corridor Agreements and Prepayment Premiums.
On each Distribution Date, 50% of the increase in the
Overcollateralized Amount will be payable as a reduction of the
Lower-Tier
Principal Amounts of the LT-Accretion Directed Classes (each such
Class will be
reduced by an amount equal to 50% of any increase in the
Overcollateralized
Amount that is attributable to a reduction in the Class Certificate
Balance of
its Corresponding Class) and will be accrued and added to the
Lower-Tier
Principal Amounts of the Class LT-Accrual Interest. On each
Distribution Date,
the increase in the Lower-Tier Principal Amounts of the Class
LT-Accrual
Interest may not exceed interest accruals for such Distribution
Date for the
Class LT-Accrual Interest. In the event that: (i) 50% of the
increase in the
Overcollateralized Amount exceeds (ii) interest accruals on the
Class LT-Accrual
Interest for such Distribution Date, the excess for such
Distribution Date
(accumulated with all such excesses for all prior Distribution
Dates) will be
added to any increase in the Overcollateralized Amount for purposes
of
determining the amount of interest accrual on the Class LT-Accrual
Interest
payable as principal on the LT-Accretion Directed Classes on the
next
Distribution Date pursuant to the first sentence of this paragraph.
All payments
of scheduled principal and prepayments of principal generated by
the Mortgage
Loans and all Subsequent Recoveries shall be allocated (i) 50% to
the Class
LT-Accrual Interest, the Class LT Group I Interest and Class LT
Group II
Interest (and further allocated among these Lower Tier Regular
Interests in the
manner described below) and (ii) 50% to the LT-Accretion Directed
Classes
(principal payments and Subsequent Recoveries shall be allocated
among such
LT-Accretion Directed Classes in an amount equal to 50% of the
principal amounts
allocated to their respective Corresponding Classes), until paid in
full.
Notwithstanding the above, principal payments allocated to the
Class X Interest
that result in the reduction in the Overcollateralized Amount shall
be allocated
to the Class LT-Accrual Interest (until paid in full). Realized
Losses shall be
applied so that after all distributions have been made on each
Distribution Date
(i) the principal balance of each of the LT-Accretion Directed
Classes is equal
to 50% of the Lower Tier Principal Amount of their Corresponding
Class of Upper
Tier Regular Interest, and (ii) the Class LT-Accrual Interest, the
Class LT
Group I Interest and Class LT Group II Interest (and further
allocated among
these Lower Tier Regular Interests in the manner described below)
is equal to
50% of the aggregate Stated Principal Balance of the Mortgage Loans
plus 50% of
the Overcollateralized Amount. Any increase in the Class
Certificate Balance of
a Class of LIBOR Certificates as a result of a Subsequent Recovery
shall
increase the Lower-Tier Principal Amount of the Corresponding Class
of
Lower-Tier Regular Interest by 50% of such increase, and the
remaining 50% of
such increase shall increase the Lower-Tier Principal Amount of the
Class
LT-Accrual Interest, the Class LT Group I Interest and Class LT
Group II
Interest (and further allocated among these Lower Tier Regular
Interests in the
manner described below). As among the Class LT Accrual Interest,
the Class LT
Group I Interest and the Class LT Group II Interest, all payments
of scheduled
principal and prepayments of principal generated by the Mortgage
Loans, and all
Realized Losses, allocable to such Lower Tier Regular Interests
shall be
allocated (i) to the Class LT Group I Interest and the Class LT
Group II
Interest, each from the related Loan Group so that their respective
Lower Tier
Principal Amounts (computed to at least eight decimal places) are
equal to
0.001% of the aggregate Stated Principal Balance of the Mortgage
Loans in the
related Loan Group and (ii) the remainder of such Realized Losses
to the Class
LT Accrual Interest.
Upper-Tier REMIC
The Upper Tier REMIC shall issue the following classes of Upper
Tier
Regular Interests, and each such interest, other than the Class
UT-R Interest,
is hereby designated as a regular interest in the Upper Tier
REMIC.
Upper Tier Initial
Upper Tier
Interest Rate and
Principal Amount
Corresponding and
Corresponding Corresponding
Upper Tier
Class
Class Certificate
Class of
Class Designation
Pass-Through
Rate
Balance
Certificates
-----------------
----------------- ------------------
------------
Class A-1A
(1)
$238,899,000 Class
A-1A(9)
Class A-1B
(2)
$26,545,000
Class A-1B(9)
Class A-2A
(3)
$159,198,000 Class
A-2A(9)
Class A-2B
(4)
$121,835,000 Class
A-2B(9)
Class A-2C
(5)
$12,360,000
Class A-2C(9)
Class M-1
(6)
$52,207,000
Class M-1(9)
Class M-2
(6)
$15,074,000
Class
M-2(9)
Class M-3
(6)
$26,104,000
Class M-3(9)
Class M-4
(6)
$11,397,000
Class M-4(9)
Class M-5
(6)
$10,295,000
Class M-5(9)
Class M-6
(6)
$ 6,617,000
Class M-6(9)
Class B-1
(6)
$ 8,456,000
Class B-1(9)
Class B-2
(6)
$ 6,986,000
Class B-2(9)
Class B-3
(6)
$ 7,353,000
Class B-3(9)
Class UT-X
(7)
(7)
Class X(7)
Class UT-R
(8)
0
Class R-1
------------
(1) The Class
A-1A Interest will bear interest during each Interest Accrual
Period at
a per annum rate equal to (a) on or prior to the Optional
Termination Date, the least of (i) LIBOR plus 0.240%, (ii) the Loan
Group
I WAC Cap
and (iii) the WAC Cap or (b) after the Optional Termination
Date, the least of (i)
LIBOR plus 0.480%, (ii) the Loan Group I WAC Cap
and (iii)
the WAC Cap.
(2) The Class
A-1B Interest will bear interest during each Interest Accrual
Period at
a per annum rate equal to (a) on or prior to the Optional
Termination
Date, the least of (i) LIBOR plus 0.340%, (ii) the Loan Group
I WAC Cap
and (iii) the WAC Cap or (b) after the Optional Termination
Date, the
least of (i) LIBOR plus 0.680%, (ii) the Loan Group I WAC Cap
and (iii)
the WAC Cap.
(3) The Class
A-2A Interest will bear interest during each Interest Accrual
Period at
a per annum rate equal to (a) on or prior to the Optional
Termination Date, the least of (i) LIBOR plus 0.100%, (ii) the Loan
Group
II WAC Cap
and (iii) the WAC Cap or (b) after the Optional Termination
Date, the
least of (i) LIBOR plus 0.200%, (ii) the Loan Group II WAC Cap
and (iii)
the WAC Cap.
(4) The Class
A-2B Interest will bear interest during each Interest Accrual
Period at
a per annum rate equal to (a) on or prior to the Optional
Termination Date, the least of (i) LIBOR plus 0.240%, (ii) the Loan
Group
II WAC Cap
and (iii) the WAC Cap or (b) after the Optional Termination
Date, the
least of (i) LIBOR plus 0.480%, (ii) the Loan Group II WAC Cap
and (iii)
the WAC Cap.
(5) The Class
A-2C Interest will bear interest during each Interest Accrual
Period at
a per annum rate equal to (a) on or prior to the Optional
Termination Date, the least of (i) LIBOR plus 0.330%, (ii) the Loan
Group
II WAC Cap
and (iii) the WAC Cap or (b) after the Optional Termination
Date, the
least of (i) LIBOR plus 0.660%, (ii) the Loan Group II WAC Cap
and (iii)
the WAC Cap.
(6) The Class
M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6,
Class B-1,
Class B-2 and Class B-3 Interests will bear interest during
each
Interest Accrual Period at a per annum rate equal to (a) on or
prior
to the
Optional Termination Date, the lesser of (i) LIBOR plus 0.450%,
0.470%,
0.640%, 0.720%, 1.700%, 2.150%, 2.000%, 2.500% and 2.500%
respectively and (ii) the WAC Cap or (b) after the Optional
Termination
Date, the
lesser of (i) LIBOR plus 0.675%, 0.705%, 0.960%, 1.080%,
2.550%,
3.225%,
3.000%, 3.750% and 3.750% respectively and (ii) the WAC Cap.
(7) The Class
UT-X Interest has an initial principal balance of approximately
$31,986,672, but it will not accrue interest on such balance but
will
accrue
interest on a notional principal balance. As of any
Distribution
Date, the
Class UT-X Interest shall have a notional principal balance
equal to
the aggregate of the principal balances of the Lower Tier
Regular
Interests
as of the first day of the related Interest Accrual Period.
With
respect to
any Interest Accrual Period, the Class UT-X Interest shall bear
interest
at a rate equal to the excess, if any, of the WAC Cap over the
product of
(i) 2 and (ii) the weighted average of the Lower-Tier Interest
Rates of
the Lower Tier Regular Interests, where the Lower-Tier Interest
Rates on
the Class LT-Accrual Interest, Class LT-Group I and Class
LT-Group
II Interests are subject to a cap equal to zero and on each
LT-Accretion Directed Class is subject to a cap equal to the
Pass-Through
Rate on
its Corresponding Class. With respect to any Distribution Date,
interest
that so accrues on the notional principal balance of the Class
UT-X
Interest shall be deferred in an amount equal to any increase in
the
Overcollateralized Amount on such Distribution Date. Such
deferred
interest
shall not itself bear interest.
(8) The Class
UT-R Interest is the sole class of residual interest in the
Upper Tier
REMIC. The Class UT-R Interest does not have an interest rate.
(9) The Class
A-1A, Class A-1B, Class A-2A, Class A-2B, Class A-2C, Class
M-1,
Class M-2,
Class M-3, Class M-4, Class M-5, Class M-6 and Class B
Certificates will represent not only the ownership of the
Corresponding
Class of
Upper Tier Regular Interest but also the right to receive
payments
from the Excess Reserve Fund Account in respect of any Basis
Risk
Carry
Forward Amounts. Each of the Class B-1 Interest, Class B-2
Interest,
Class B-3
Interest, Interest and Class UT-X Interest will be contributed
to the
Class B-1 REMIC, the Class B-2 REMIC, the Class B-3 REMIC and
the
Class X
REMIC, respectively.
<PAGE>
Class B-1 REMIC
The Class B-1 REMIC shall issue the following classes of
interests.
The Class B-1 Certificates shall represent the regular interest in
the Class B-1
REMIC (designated below as the "Class B-1 REMIC Regular Interest")
and the Class
B1-R Interest shall represent the sole class of residual interest
in the Class
B-1 REMIC.
Class B-1 REMIC
Class B-1 REMIC Principal
Designation Interest Rate
Amount
-----------------
---------------
---------------------------
Class B-1 REMIC
(1)
(1)
Regular Interest
Class B1-R
(2)
(2)
------------
(1) The Class
B-1 REMIC shall issue one regular interest which shall be
represented by the Class B-1 Certificates and shall be entitled to
100% of
all
amounts payable on the Class B-1 Interest issued by the
Upper-Tier
REMIC.
(2) The Class
B1-R Interest is the sole class of residual interest in the
Class B-1
REMIC and shall be represented by the Class R-2 Certificate.
The
Class B1-R
Interest does not have an interest rate or a principal balance.
Class B-2 REMIC
The Class B-2 REMIC shall issue the following classes of
interests.
The Class B-2 Certificates shall represent the regular interest in
the Class B-2
REMIC (designated below as the "Class B-2 REMIC Regular Interest")
and the Class
B2-R Interest shall represent the sole class of residual interest
in the Class
B-2 REMIC.
Class B-2 REMIC
Class B-2 REMIC Principal
Designation Interest Rate
Amount
-----------------
---------------
---------------------------
Class B-2 REMIC
(1)
(1)
Regular Interest
Class B2-R
(2)
(2)
------------
(1) The Class
B-2 REMIC shall issue one regular interest which shall be
represented by the Class B-2 Certificates and shall be entitled to
100% of
all
amounts payable on the Class B-2 Interest issued by the
Upper-Tier
REMIC.
(2) The Class
B2-R Interest is the sole class of residual interest in the
Class B-2
REMIC and shall be represented by the Class R-2 Certificate.
The
Class B2-R
Interest does not have an interest rate or a principal balance.
<PAGE>
Class B-3 REMIC
The Class B-3 REMIC shall issue the following classes of
interests.
The Class B-3 Certificates shall represent the regular interest in
the Class B-3
REMIC (designated below as the "Class B-3 REMIC Regular Interest")
and the Class
B3-R Interest shall represent the sole class of residual interest
in the Class
B-3 REMIC.
Class B-3 REMIC
Class B-3 REMIC Principal
Designation Interest Rate
Amount
-----------------
---------------
---------------------------
Class B-3 REMIC
(1)
(1)
Regular Interest
Class B3-R
(2)
(2)
------------
(1) The Class
B-3 REMIC shall issue one regular interest which shall be
represented by the Class B-3 Certificates and shall be entitled to
100% of
all
amounts payable on the Class B-3 Interest issued by the
Upper-Tier
REMIC.
(2) The Class
B3-R Interest is the sole class of residual interest in the
Class B-3
REMIC and shall be represented by the Class R-2 Certificate.
The
Class B3-R
Interest does not have an interest rate or a principal balance.
Class X REMIC
The Class X REMIC shall issue the following classes of
interests.
The Class X Regular Interest shall represent the regular interest
in the Class X
REMIC (designated below as the "Class X Regular Interest") and the
Class X-R
Interest shall represent the sole class of residual interest in the
Class X
REMIC.
Class X REMIC
Class X REMIC Principal
Designation Interest Rate
Amount
-----------------
---------------
---------------------------
Class X Regular
(1)
(1)
Interest
Class X-R
(2)
(2)
------------
(1) The Class X
REMIC shall issue one regular interest which shall be
represented by the Class X Certificates and shall be entitled to
100% of
all
amounts payable on the Class UT-X Interest issued by the
Upper-Tier
REMIC.
(2) The Class
X-R Interest is the sole class of residual interest in the
Class
X REMIC
and shall be represented by the Class R-2 Certificate. The
Class
X-R
Interest does not have an interest rate or a principal balance.
The Class B-1, Class B-2 and Class B-3 Certificates will
represent
not only the ownership of the regular interest issued by the Class
B-1 REMIC,
Class B-2 REMIC and the Class B-3 REMIC respectively, but also the
right to
receive payments from the Excess Reserve Fund Account in respect of
any Basis
Risk Carry Forward Amounts. The Class X Certificates will represent
ownership of
the Class X Regular Interest, the Corridor Agreements and the
Excess Reserve
Fund Account, subject to the obligation to pay Basis Risk Carry
Forward Amounts.
For federal income tax purposes, the Trustee will treat a LIBOR
Certificateholder's right to receive payments from the Excess
Reserve Fund
Account as payments made pursuant to an interest rate cap contract
written by
the Class X Certificateholders. Such rights of the LIBOR
Certificateholders
shall be treated as held in a portion of the Trust Fund that is
treated as a
grantor trust under subpart E, Part I of subchapter J of the
Code.
The minimum denomination for each Class of Certificates (other
than
the Class R-1, Class R-2, Class X and Class P Certificates) will be
$25,000,
with integral multiples of $1 in excess thereof except that one
Certificate in
each Class may be issued in a different amount.
The minimum denomination for (a) each of the Class R-1 and Class
R-2
Certificates will be a 100% Percentage Interest in such Class and
(b) each of
the Class X and Class P Certificates will be a 1% Percentage
Interest in such
Class.
Set forth below are designations of Classes of Certificates to
the
categories used herein:
Book-Entry Certificates...... All Classes of Certificates other than the
Physical Certificates.
Class A Certificates......... Class A-1A, Class A-1B, Class A-2A,
Class A-2B and
Class A-2C Certificates.
Class R Certificates......... The Class R-1 and Class R-2
Certificates.
Class B Certificates......... Class B-1, Class B-2 and Class B-3
Certificates.
Class M Certificates......... Class M-1, Class M-2, Class M-3,
Class M-4, Class
M-5 and Class M-6 Certificates.
Delay Certificates........... None.
ERISA-Restricted
Certificates............... Class R Certificates, Class P
Certificates and
Class X Certificates; any certificate with a
rating below the lowest applicable permitted
rating under the Underwriters' Exemption.
LIBOR Certificates........... The Class A Certificates and the Subordinated
Certificates.
Non-Delay Certificates....... Class A, Class X and Subordinated
Certificates.
Offered Certificates......... All Classes of Certificates other than the
Private Certificates.
Physical Certificates........ Class P, Class X and Class R
Certificates.
Private Certificates......... Class B-1, Class B-2, Class B-3, Class P and
Class X Certificates.
Rating Agencies.............. Moody's and Standard &
Poor's.
Regular Certificates......... All Classes of Certificates other than the
Class P and Class R Certificates.
Residual Certificates........ Class R-1 and Class R-2
Certificates.
Subordinated Certificates.... Class M and Class B Certificates.
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. Whenever used in this Agreement, the
following words and phrases, unless the context otherwise requires,
shall have
the following meanings:
Accepted Servicing Practices: With respect to any Mortgage
Loan,
those mortgage servicing practices set forth in Section 3.01(a) of
this
Agreement.
Account: Any of the Collection Account, the Distribution
Account,
any Escrow Account or the Excess Reserve Fund Account. Each Account
shall be an
Eligible Account.
Accrued Certificate Interest Distribution Amount: With respect
to
any Distribution Date for each Class of the LIBOR Certificates, the
amount of
interest accrued during the related Interest Accrual Period at the
applicable
Pass-Through Rate on the related Class Certificate Balance,
immediately prior to
such Distribution Date, as reduced by such Class's share of Net
Prepayment
Interest Shortfalls and Relief Act Interest Shortfalls for such
Distribution
Date allocated to such Class pursuant to Section 4.02.
Adjustable Rate Mortgage Loan: An adjustable rate Mortgage
Loan.
Adjusted Net Mortgage Interest Rate: As to each Mortgage Loan and
at
any time, the per annum rate equal to the Mortgage Interest Rate
less the
Expense Fee Rate.
Adjustment Date: As to any Mortgage Loan, the first Due Date on
which the related Mortgage Interest Rate adjusts as set forth in
the related
Mortgage Note and each Due Date thereafter on which the Mortgage
Interest Rate
adjusts as set forth in the related Mortgage Note.
Advance: Any P&I Advance or Servicing Advance.
Advance Facility: A financing or other facility as described in
Section 10.07.
Advance Facility Notice: As defined in Section 10.07.
Advance Financing Person: The Person to whom the Servicer's
rights
under this Agreement to be reimbursed for any P&I Advances or
Servicing Advances
have been assigned pursuant to Section 10.07.
Advance Reimbursement Amounts: As defined in Section 10.07.
Affiliate: With respect to any Person, any other Person
controlling,
controlled by or under common control with such first Person. For
the purposes
of this definition, "control" means the power to direct the
management and
policies of such Person, directly or indirectly, whether through
the ownership
of voting securities, by contract or otherwise; and the terms
"controlling" and
"controlled" have meanings correlative to the foregoing.
Agreement: This
Pooling and Servicing Agreement and all amendments
or supplements hereto.
Amount Held for Future Distribution: As to the Certificates on
any
Distribution Date, the aggregate amount held in the Collection
Account at the
close of business on the related Remittance Date on account of (i)
Principal
Prepayments, Insurance Proceeds, Condemnation Proceeds and
Liquidation Proceeds
on the Mortgage Loans received after the end of the related
Prepayment Period
and (ii) all Scheduled Payments on the Mortgage Loans due after the
end of the
related Due Period.
Applied Realized Loss Amount: With respect to any Distribution
Date,
the amount, if any, by which the aggregate Class Certificate
Balance of the
LIBOR Certificates after distributions of principal on such
Distribution Date
exceeds the aggregate Stated Principal Balance of the Mortgage
Loans for such
Distribution Date.
Appraised Value: (i) With respect to any First Lien Mortgage
Loan,
the value of the related Mortgaged Property based upon the
appraisal made for
the originator at the time of origination of the Mortgage Loan or
the sales
price of the Mortgaged Property at such time of origination,
whichever is less,
and (ii) with respect to any Second Lien Mortgage Loan, the value,
determined
pursuant to the Underwriting Guidelines, of the related Mortgaged
Property as of
the origination of the Second Lien Mortgage Loan; provided,
however, that in the
case of a refinanced Mortgage Loan, such value is based solely upon
the
appraisal made at the time of origination of such refinanced
Mortgage Loan.
Assignment of Mortgage: An assignment of the Mortgage, notice
of
transfer or equivalent instrument in recordable form (other than
the assignee's
name and recording information not yet returned from the recording
office),
reflecting the sale of the Mortgage to the Trust.
Available Funds: With respect to any Distribution Date and the
Mortgage Loans to the extent received by the Trustee (x) the sum of
(i) all
scheduled installments of interest (net of the related Expense
Fees) and
principal due on the Due Date on such Mortgage Loans in the related
Due Period
and received on or prior to the related Determination Date,
together with any
P&I Advances in respect thereof; (ii) all Condemnation
Proceeds, Insurance
Proceeds and Liquidation Proceeds received during the related
Prepayment Period
(in each case, net of unreimbursed expenses incurred in connection
with a
liquidation or foreclosure and unreimbursed Advances, if any);
(iii) all partial
or full prepayments on the Mortgage Loans received during the
related Prepayment
Period together with all Compensating Interest paid by the Servicer
in
connection therewith (excluding Prepayment Premiums); (iv) all
amounts received
with respect to such Distribution Date as the Substitution
Adjustment Amount or
the Repurchase Price in respect of a Deleted Mortgage Loan
substituted for or a
Mortgage Loan repurchased by the Purchaser or WMC, as applicable,
as of such
Distribution Date; and (v) the proceeds received with respect to
the termination
of the Trust Fund pursuant to clause (a) of Section 9.01, reduced
by (y) all
amounts in reimbursement for P&I Advances and Servicing
Advances previously made
with respect to the Mortgage Loans and other amounts as to which
the Servicer,
the Depositor, the Trustee (or co-trustee) or the Custodian are
entitled to be
paid or reimbursed pursuant to this Agreement.
Basic Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the Principal Remittance
Amount for such
Distribution Date over (ii) the Excess Overcollateralized Amount,
if any, for
such Distribution Date.
Basis Risk Carry Forward Amount: With respect to each Class of
LIBOR
Certificates, as of any Distribution Date, the sum of (A) if on
such
Distribution Date the Pass-Through Rate for any Class of LIBOR
Certificates is
based upon the Loan Group I WAC Cap, the Loan Group II WAC Cap or
the WAC Cap,
the excess, if any, of (i) the Accrued Certificate Interest
Distribution Amount
such Class of LIBOR Certificates would otherwise be entitled to
receive on such
Distribution Date had such Pass-Through Rate not been subject to
the Loan Group
I WAC Cap, the Loan Group II WAC Cap or the WAC Cap, as applicable,
over (ii)
the Accrued Certificate Interest Distribution Amount payable on
such Class of
Certificates on such Distribution Date taking into account the Loan
Group I WAC
Cap, the Loan Group II WAC Cap or the WAC Cap, as applicable, and
(B) the Basis
Risk Carry Forward Amount for such Class of LIBOR Certificates for
all previous
Distribution Dates not previously paid, together with interest
thereon at a rate
equal to the applicable Pass-Through Rate for such Class of LIBOR
Certificates
for such Distribution Date (without giving effect to the Loan Group
I WAC Cap,
the Loan Group II WAC Cap or the WAC Cap, as applicable).
Basis Risk Payment: For any Distribution Date, an amount equal
to
the lesser of (i) the aggregate of the Basis Risk Carry Forward
Amounts for such
Distribution Date and (ii) the Class X Distributable Amount (prior
to any
reduction for Basis Risk Payments from the Excess Reserve Fund
Account).
Best's: Best's Key Rating Guide, as the same shall be amended
from
time to time.
Book-Entry Certificates: As specified in the Preliminary
Statement.
Business Day: Any day other than (i) Saturday or Sunday, or (ii)
a
day on which banking and savings and loan institutions, in (a) the
States of New
York, California, Texas and Illinois, (b) the State in which the
Servicer's
servicing operations are located, or (c) the State in which the
Trustee's
operations are located, are authorized or obligated by law or
executive order to
be closed.
Certificate: Any one of the Certificates executed by the Trustee
in
substantially the forms attached hereto as exhibits.
Certificate Balance: With respect to any Class of LIBOR
Certificates, at any date, the maximum dollar amount of principal
to which the
Holder thereof is then entitled hereunder, such amount being equal
to the
Denomination thereof minus all distributions of principal
previously made with
respect thereto and reduced by the amount of any Applied Realized
Loss Amounts
previously allocated to such Class of Certificates pursuant to
Section 4.05;
provided, however, that immediately following the Distribution Date
on which a
Subsequent Recovery is distributed, the Class Certificate Balances
of any Class
or Classes of Certificates that have been previously reduced by
Applied Realized
Loss Amounts will be increased, in order of seniority, by the
amount of the
Subsequent Recovery distributed on such Distribution Date (up to
the amount of
Applied Realized Loss Amounts allocated to such Class or Classes).
The Class X,
Class P and Class R Certificates have no Certificate Balance.
Certificate Owner: With respect to a Book-Entry Certificate,
the
Person who is the beneficial owner of such Book-Entry
Certificate.
Certificate
Register: The register maintained pursuant to Section
5.02.
Certificateholder or Holder: The Person in whose name a
Certificate
is registered in the Certificate Register, except that, solely for
the purpose
of giving any consent pursuant to this Agreement, any Certificate
registered in
the name of the Depositor or any affiliate of the Depositor shall
be deemed not
to be Outstanding and the Percentage Interest evidenced thereby
shall not be
taken into account in determining whether the requisite amount of
Percentage
Interests necessary to effect such consent has been obtained;
provided, however,
that if any such Person (including the Depositor) owns 100% of the
Percentage
Interests evidenced by a Class of Certificates, such Certificates
shall be
deemed to be Outstanding for purposes of any provision hereof that
requires the
consent of the Holders of Certificates of a particular Class as a
condition to
the taking of any action hereunder. The Trustee is entitled to rely
conclusively
on a certification of the Depositor or any Affiliate of the
Depositor in
determining which Certificates are registered in the name of an
Affiliate of the
Depositor.
Certification: As defined in Section 8.12(b).
Class: All Certificates bearing the same class designation as
set
forth in the Preliminary Statement.
Class A Certificate Group: Either of the Class A-1 Certificate
Group
or the Class A-2 Certificate Group, as applicable.
Class A Certificates: As specified in the Preliminary
Statement.
Class A Principal Allocation Percentage. With respect to any
Distribution Date, the percentage equivalent of a fraction,
determined as
follows: (i) in the case of the Class A-1 Certificate Group, the
numerator of
which is (x) the portion of the Principal Remittance Amount for
such
Distribution Date that is attributable to principal received or
advanced on the
Group I Mortgage Loans and the denominator of which is (y) the
Principal
Remittance Amount for such Distribution Date; and (ii) in the case
of the Class
A-2 Certificate Group, the numerator of which is (x) the portion of
the
Principal Remittance Amount for such Distribution Date that is
attributable to
principal received or advanced on the Group II Mortgage Loans and
the
denominator of which is (y) the Principal Remittance Amount for
such
Distribution Date.
Class A Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the aggregate Class
Certificate Balances of
the Class A Certificates immediately prior to such Distribution
Date over (ii)
the lesser of (A) 52.00% of the aggregate Stated Principal Balance
of the
Mortgage Loans for such Distribution Date and (B) the excess, if
any, of the
aggregate Stated Principal Balance of the Mortgage Loans for such
Distribution
Date over the Overcollateralization Floor.
Class A-1 Certificate Group: The Class A-1A Certificates and
Class
A-1B Certificates, collectively.
Class A-1 Corridor Agreement: The interest rate corridor
agreement
with respect to the Class A-1A and Class A-1B Certificates, dated
December 28,
2005, between the Purchaser and the Corridor Agreement
Provider.
Class A-1A Certificates: All Certificates bearing the class
designation of "Class A-1A."
Class A-1B Certificates: All Certificates bearing the class
designation of "Class A-1B."
Class A-2 Certificate Group: The Class A-2A, Class A-2B and
Class
A-2C Certificates, collectively.
Class A-2 Corridor Agreement: The interest rate corridor
agreement
with respect to the Class A-2A, Class A-2B and Class A-2C
Certificates, dated
December 28, 2005, between the Purchaser and the Corridor Agreement
Provider.
Class A-2A Certificates: All Certificates bearing the class
designation of "Class A-2A."
Class A-2B Certificates: All Certificates bearing the class
designation of "Class A-2B."
Class A-2C Certificates: All Certificates bearing the class
designation of "Class A-2C."
Class B-1 Certificates: All Certificates bearing the class
designation of "Class B-1."
Class B-1 Interest: The Upper Tier Regular Interest held by the
Class B-1 REMIC as specified and described in the Preliminary
Statement and the
related footnote thereto.
Class B-1 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate
Class
Certificate Balances of the Class A Certificates (after taking into
account the
distribution of the Class A Principal Distribution Amount on such
Distribution
Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution
Amount on such Distribution Date), (C) the Class Certificate
Balance of the
Class M-2 Certificates (after taking into account the distribution
of the Class
M-2 Principal Distribution Amount on such Distribution Date), (D)
the Class
Certificate Balance of the Class M-3 Certificates (after taking
into account the
distribution of the Class M-3 Principal Distribution Amount on such
Distribution
Date), (E) the Class Certificate Balance of the Class M-4
Certificates (after
taking into account the distribution of the Class M-4 Principal
Distribution
Amount on such Distribution Date), (F) the Class Certificate
Balance of the
Class M-5 Certificates (after taking into account the distribution
of the Class
M-5 Principal Distribution Amount on such Distribution Date), (G)
the Class
Certificate Balance of the Class M-6 Certificates (after taking
into account the
distribution of the Class M-6 Principal Distribution Amount on such
Distribution
Date) and (H) the Class Certificate Balance of the Class B-1
Certificates
immediately prior to such Distribution Date, over (ii) the lesser
of (A) the
product of (x) 87.40% and (y) the aggregate Stated Principal
Balance of the
Mortgage Loans for such Distribution Date, and (B) the excess, if
any, of the
aggregate Stated Principal Balance of the Mortgage Loans for such
Distribution
Date over the Overcollateralization Floor.
Class B1-R Interest: The residual interest in the Class B-1 REMIC
as
described in the Preliminary Statement and the related footnote
thereto.
Class B-1 REMIC: As described in the Preliminary Statement.
Class B-2 Certificates: All Certificates bearing the class
designation of "Class B-2."
Class B-2 Interest: The Upper Tier Regular Interest held by the
Class B-2 REMIC as specified and described in the Preliminary
Statement and the
related footnote thereto.
Class B-2 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate
Class
Certificate Balances of the Class A Certificates (after taking into
account the
distribution of the Class A Principal Distribution Amount on such
Distribution
Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution
Amount on such Distribution Date), (C) the Class Certificate
Balance of the
Class M-2 Certificates (after taking into account the distribution
of the Class
M-2 Principal Distribution Amount on such Distribution Date), (D)
the Class
Certificate Balance of the Class M-3 Certificates (after taking
into account the
distribution of the Class M-3 Principal Distribution Amount on such
Distribution
Date), (E) the Class Certificate Balance of the Class M-4
Certificates (after
taking into account the distribution of the Class M-4 Principal
Distribution
Amount on such Distribution Date), (F) the Class Certificate
Balance of the
Class M-5 Certificates (after taking into account the distribution
of the Class
M-5 Principal Distribution Amount on such Distribution Date), (G)
the Class
Certificate Balance of the Class M-6 Certificates (after taking
into account the
distribution of the Class M-6 Principal Distribution Amount on such
Distribution
Date), (H) the Class Certificate Balance of the Class B-1
Certificates (after
taking into account the distribution of the Class B-1 Principal
Distribution
Amount on such Distribution Date) and (I) the Class Certificate
Balance of the
Class B-2 Certificates immediately prior to such Distribution Date,
over (ii)
the lesser of (A) the product of (x) 89.30% and (y) the aggregate
Stated
Principal Balance of the Mortgage Loans for such Distribution Date,
and (B) the
excess, if any, of the aggregate Stated Principal Balance of the
Mortgage Loans
for such Distribution Date over the Overcollateralization
Floor.
Class B2-R Interest: The residual interest in the Class B-2 REMIC
as
described in the Preliminary Statement and the related footnote
thereto.
Class B-2 REMIC: As described in the Preliminary Statement.
Class B-3 Certificates: All Certificates bearing the class
designation of "Class B-3."
Class B-3 Interest: The Upper Tier Regular Interest held by the
Class B-3 REMIC as specified and described in the Preliminary
Statement and the
related footnote thereto.
Class B-3 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate
Class
Certificate Balances of the Class A Certificates (after taking into
account the
distribution of the Class A Principal Distribution Amount on such
Distribution
Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution
Amount on such Distribution Date), (C) the Class Certificate
Balance of the
Class M-2 Certificates (after taking into account the distribution
of the Class
M-2 Principal Distribution Amount on such Distribution Date), (D)
the Class
Certificate Balance of the Class M-3 Certificates (after taking
into account the
distribution of the Class M-3 Principal Distribution Amount on such
Distribution
Date), (E) the Class Certificate Balance of the Class M-4
Certificates (after
taking into account the distribution of the Class M-4 Principal
Distribution
Amount on such Distribution Date), (F) the Class Certificate
Balance of the
Class M-5 Certificates (after taking into account the distribution
of the Class
M-5 Principal Distribution Amount on such Distribution Date), (G)
the Class
Certificate Balance of the Class M-6 Certificates (after taking
into account the
distribution of the Class M-6 Principal Distribution Amount on such
Distribution
Date), (H) the Class Certificate Balance of the Class B-1
Certificates (after
taking into account the distribution of the Class B-1 Principal
Distribution
Amount on such Distribution Date), (I) the Class Certificate
Balance of the
Class B-2 Certificates (after taking into account the distribution
of the Class
B-2 Principal Distribution Amount on such Distribution Date) and
(J) the Class
Certificate Balance of the Class B-3 Certificates immediately prior
to such
Distribution Date over (ii) the lesser of (A) the product of (x)
91.30% and (y)
the aggregate Stated Principal Balance of the Mortgage Loans for
such
Distribution Date, and (B) the excess, if any, of the aggregate
Stated Principal
Balance of the Mortgage Loans for such Distribution Date over
the
Overcollateralization Floor.
Class B3-R Interest: The residual interest in the Class B-3 REMIC
as
described in the Preliminary Statement and the related footnote
thereto.
Class B-3 REMIC: As described in the Preliminary Statement.
Class Certificate Balance: With respect to any Class and as to
any
date of determination, the aggregate of the Certificate Balances of
all
Certificates of such Class as of such date.
Class LT-R Interest: The residual interest in the Lower Tier
REMIC
as described in the Preliminary Statement and the related footnote
thereto.
Class M-1 Certificates: All Certificates bearing the class
designation of "Class M-1."
Class M-1 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate
Class
Certificate Balances of the Class A Certificates (after taking into
account the
distribution of the Class A Principal Distribution Amount on such
Distribution
Date), and (B) the Class Certificate Balance of the Class M-1
Certificates
immediately prior to such Distribution Date over (ii) the lesser of
(A) 66.20%
of the aggregate Stated Principal Balance of the Mortgage Loans for
such
Distribution Date and (B) the excess, if any, of the aggregate
Stated Principal
Balance of the Mortgage Loans for such Distribution Date over
the
Overcollateralization Floor.
Class M-2 Certificates: All Certificates bearing the class
designation of "Class M-2."
Class M-2 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate
Class
Certificate Balances of the Class A Certificates (after taking into
account the
distribution of the Class A Principal Distribution Amount on such
Distribution
Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution
Amount on such Distribution Date), and (C) the Class Certificate
Balance of the
Class M-2 Certificates immediately prior to such Distribution Date
over (ii) the
lesser of (A) 70.30% of the aggregate Stated Principal Balance of
the Mortgage
Loans for such Distribution Date and (B) the excess, if any, of the
aggregate
Stated Principal Balance of the Mortgage Loans for such
Distribution Date over
the Overcollateralization Floor.
Class M-3 Certificates: All Certificates bearing the class
designation of "Class M-3."
Class M-3 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate
Class
Certificate Balances of the Class A Certificates (after taking into
account the
distribution of the Class A Principal Distribution Amount on such
Distribution
Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution
Amount on such Distribution Date), (C) the Class Certificate
Balance of the
Class M-2 Certificates (after taking into account the distribution
of the Class
M-2 Principal Distribution Amount on such Distribution Date), and
(D) the Class
Certificate Balance of the Class M-3 Certificates immediately prior
to such
Distribution Date over (ii) the lesser of (A) 77.40% of the
aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date
and (B) the
excess, if any, of the aggregate Stated Principal Balance of the
Mortgage Loans
for such Distribution Date over the Overcollateralization
Floor.
Class M-4 Certificates: All Certificates bearing the class
designation of "Class M-4."
Class M-4 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate
Class
Certificate Balances of the Class A Certificates (after taking into
account the
distribution of the Class A Principal Distribution Amount on such
Distribution
Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution
Amount on such Distribution Date), (C) the Class Certificate
Balance of the
Class M-2 Certificates (after taking into account the distribution
of the Class
M-2 Principal Distribution Amount on such Distribution Date), (D)
the Class
Certificate Balance of the Class M-3 Certificates (after taking
into account the
distribution of the Class M-3 Principal Distribution Amount on such
Distribution
Date) and (E) the Class Certificate Balance of the Class M-4
Certificates
immediately prior to such Distribution Date, over (ii) the lesser
of (A) the
product of (x) 80.50% and (y) the aggregate Stated Principal
Balance of the
Mortgage Loans for such Distribution Date, and (B) the excess, if
any, of the
aggregate Stated Principal Balance of the Mortgage Loans for such
Distribution
Date over the Overcollateralization Floor.
Class M-5 Certificates: All Certificates bearing the class
designation of "Class M-5."
Class M-5 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate
Class
Certificate Balances of the Class A Certificates (after taking into
account the
distribution of the Class A Principal Distribution Amount on such
Distribution
Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution
Amount on such Distribution Date), (C) the Class Certificate
Balance of the
Class M-2 Certificates (after taking into account the distribution
of the Class
M-2 Principal Distribution Amount on such Distribution Date), (D)
the Class
Certificate Balance of the Class M-3 Certificates (after taking
into account the
distribution of the Class M-3 Principal Distribution Amount on such
Distribution
Date), (E) the Class Certificate Balance of the Class M-4
Certificates (after
taking into account the distribution of the Class M-4 Principal
Distribution
Amount on such Distribution Date) and (F) the Class Certificate
Balance of the
Class M-5 Certificates immediately prior to such Distribution Date,
over (ii)
the lesser of (A) the product of (x) 83.30% and (y) the aggregate
Stated
Principal Balance of the Mortgage Loans for such Distribution Date,
and (B) the
excess, if any, of the aggregate Stated Principal Balance of the
Mortgage Loans
for such Distribution Date over the Overcollateralization
Floor.
Class M-6 Certificates: All Certificates bearing the class
designation of "Class M-6."
Class M-6 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate
Class
Certificate Balances of the Class A Certificates (after taking into
account the
distribution of the Class A Principal Distribution Amount on such
Distribution
Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution
Amount on such Distribution Date), (C) the Class Certificate
Balance of the
Class M-2 Certificates (after taking into account the distribution
of the Class
M-2 Principal Distribution Amount on such Distribution Date), (D)
the Class
Certificate Balance of the Class M-3 Certificates (after taking
into account the
distribution of the Class M-3 Principal Distribution Amount on such
Distribution
Date), (E) the Class Certificate Balance of the Class M-4
Certificates (after
taking into account the distribution of the Class M-4 Principal
Distribution
Amount on such Distribution Date), (F) the Class Certificate
Balance of the
Class M-5 Certificates (after taking into account the distribution
of the Class
M-5 Principal Distribution Amount on such Distribution Date) and
(G) the Class
Certificate Balance of the Class M-6 Certificates immediately prior
to such
Distribution Date, over (ii) the lesser of (A) the product of (x)
85.10% and (y)
the aggregate Stated Principal Balance of the Mortgage Loans for
such
Distribution Date, and (B) the excess, if any, of the aggregate
Stated Principal
Balance of the Mortgage Loans for such Distribution Date over
the
Overcollateralization Floor.
Class P Certificates: All Certificates bearing the class
designation
of "Class P."
Class R Certificates: As defined in the Preliminary Statement.
Class R-1 Certificates: All Certificates bearing the class
designation of "Class R-1."
Class R-2 Certificates: All Certificates bearing the class
designation of "Class R-2."
Class UT-R Interest: The residual interest in the Upper Tier
REMIC
as described in the Preliminary Statement and the related footnote
thereto.
Class UT-X Interest: The Upper Tier Regular Interest held by
the
Class X REMIC as specified and described in the Preliminary
Statement and the
related footnote thereto.
Class X Certificates: All Certificates bearing the class
designation
of "Class X."
Class X Distributable Amount: On any Distribution Date, (i) as
a
distribution in respect of interest, the amount of interest that
has accrued on
the Class X Interest and not applied as an Extra Principal
Distribution Amount
on such Distribution Date, plus any such accrued interest
remaining
undistributed from prior Distribution Dates, plus, without
duplication, (ii) as
a distribution in respect of principal, any portion of the
principal balance of
the Class X Interest which is distributable as an
Overcollateralization
Reduction Amount, minus (iii) any amounts paid from the Excess
Reserve Fund
Account to pay Basis Risk Carry Forward Amounts.
Class X Regular Interest: A regular interest in the Class X
REMIC
represented by the Class X Certificates as specified and described
in the
Preliminary Statement and the related footnote thereto.
Class X-R Interest: The residual interest in the Class X REMIC
as
described in the Preliminary Statement and the related footnote
thereto.
Class X REMIC: As described in the Preliminary Statement.
Closing Date: December 28, 2005.
Code: The Internal Revenue Code of 1986, including any successor
or
amendatory provisions.
Collection Account: As defined in Section 3.10(a).
Combined Loan-to-Value Ratio or CLTV: As of the date of
origination
and as to any Second Lien Mortgage Loan, the ratio, expressed as a
percentage,
of (a) the sum of (i) the outstanding principal balance of the
Second Lien
Mortgage Loan as of the date of origination and (ii) the
outstanding principal
balance as of the date of origination of any mortgage loan or
mortgage loans
that are senior or equal in priority to the Second Lien Mortgage
Loan and which
are secured by the same Mortgaged Property to (b) the Appraised
Value.
Compensating Interest: For any Distribution Date, the lesser of
(a)
the Prepayment Interest Shortfall, if any, for such Distribution
Date, with
respect to voluntary Principal Prepayments in Full (excluding any
payments made
upon liquidation of the Mortgage Loan) during the related
Prepayment Period, and
(b) one-half of the Servicing Fee payable to the Servicer for such
Distribution
Date.
Condemnation Proceeds: All awards, compensation and/or
settlements
in respect of a Mortgaged Property, whether permanent or temporary,
partial or
entire, by exercise of the power of eminent domain or condemnation,
to the
extent not required to be released to a Mortgagor in accordance
with the terms
of the related Mortgage Loan Documents.
Corporate Trust Office: The designated office of the Trustee in
the
State of California at which at any particular time its corporate
trust business
with respect to this Agreement is administered, which office at the
date of the
execution of this Agreement is located at 1761 East St. Andrew
Place, Santa Ana,
California 92705-4934, Attn: Trust Administration-GS05W3, facsimile
no. (714)
247-6478 and which is the address to which notices to and
correspondence with
the Trustee should be directed.
Corresponding Class and Corresponding REMIC: The class of
interests
in any Trust REMIC created under this Agreement that corresponds to
the class of
interests in another such Trust REMIC or to a Class of Certificates
and the
Trust REMIC in which the corresponding Certificate represents the
related
regular interest issued for such Trust REMIC in the manner set out
below:
Corresponding
Class of
Lower Tier
Upper Tier
Certificates or
Corresponding
Class Designation
Regular
Interest
Regular Interest
REMIC
-------------------- ------------------ --------------------
------------------
Class LT-A-1A
Class A-1A
Class A-1A
Upper Tier REMIC
Class LT-A-1B
Class A-1B
Class A-1B
Upper Tier REMIC
Class LT-A-2A
Class A-2A
Class A-2A
Upper Tier REMIC
Class LT-A-2B
Class A-2B
Class A-2B
Upper Tier REMIC
Class LT-A-2C
Class A-2C
Class A-2C
Upper Tier REMIC
Class
LT-M-1
Class M-1
Class M-1
Upper Tier REMIC
Class
LT-M-2
Class M-2
Class M-2
Upper Tier REMIC
Class
LT-M-3
Class M-3
Class M-3
Upper Tier REMIC
Class
LT-M-4
Class M-4
Class M-4
Upper Tier REMIC
Class
LT-M-5
Class M-5
Class M-5
Upper Tier REMIC
Class
LT-M-6
Class M-6
Class M-6
Upper Tier REMIC
Class
LT-B-1
Class B-1
Class B-1
Class B-1 REMIC
Class
LT-B-2
Class B-2
Class B-2
Class B-2 REMIC
Class
LT-B-3
Class B-3
Class B-3
Class B-3 REMIC
N/A
Class UT-X
Class X Regular Class X
REMIC
Interest
Corridor Agreements: The Class A-1 Corridor Agreement, the Class
A-2
Corridor Agreement and the Subordinated Corridor Agreement,
collectively.
Corridor Agreement Provider: Goldman Sachs Capital Markets, L.P.,
a
Delaware limited partnership, and its successors in interest.
Cumulative Loss Event: With respect to any Distribution Date, a
Cumulative Loss Event occurs if the Cumulative Loss Percentage
exceeds the
applicable percentage set forth below with respect to such
Distribution Date:
Distribution Date Occurring In
Loss Percentage
--------------------------------------------------------------------------------
January 2009 through December 2009 4.10% of the Cut-off Date Pool Principal
Balance
January 2010 through December 2010 5.80% of the Cut-off Date Pool Principal
Balance
January 2011 through December 2011 7.25% of the Cut-off Date Pool Principal
Balance
January 2012 and thereafter
7.90% of the Cut-off
Date Pool Principal
Balance
Cumulative Loss Percentage: As of any date of determination,
the
percentage equivalent of a fraction, the numerator of which is the
aggregate
amount of Realized Losses on the Mortgage Loans for the period from
the Cut-off
Date to the date of determination and the denominator of which is
the Stated
Principal Balance of the Mortgage Loans as of the Cut-off Date.
Custodial File: With respect to each Mortgage Loan, the file
retained by the Custodian consisting of items (a) - (h) as listed
on Exhibit L
hereto.
Custodian: Wells Fargo Bank, N.A., a national banking
association,
and its successors in interest, as applicable.
Custodian Fee: As to each Mortgage Loan and any Distribution
Date,
an amount equal to one month's interest at the Custodian Fee Rate
on the Stated
Principal Balance of such Mortgage Loan as of the preceding
Distribution Date
(or as of the Closing Date in the case of the first Distribution
Date) or, in
the event of any payment of interest which accompanies a Principal
Prepayment in
Full made by the Mortgagor, interest at the Custodian Fee Rate on
the Stated
Principal Balance of such Mortgage Loan for the period covered by
such payment
of interest.
Custodian Fee Rate: The rate set forth in the separate fee
agreement
that has been executed between the Custodian and the Trustee and
that relates to
the Mortgage Loans.
Cut-off Date: December 1, 2005.
Cut-off Date Pool Principal Balance: The aggregate Stated
Principal
Balances of all Mortgage Loans as of the Cut-off Date.
Cut-off Date Principal Balance: As to any Mortgage Loan, the
Stated
Principal Balance thereof as of the close of business on the
Cut-off Date (after
giving effect to payments of principal due on that date, whether or
not
received).
Data Tape Information: The information provided by the Purchaser
as
of the Cut-off Date to the Depositor setting forth the following
information
with respect to each Mortgage Loan: (1) the Purchaser's Mortgage
Loan
identifying number; (2) the Mortgagor's name; (3) the street
address of the
Mortgaged Property including the city, state and zip code; (4) a
code indicating
whether the Mortgaged Property is owner-occupied, a second home or
investment
property; (5) the number and type of residential units constituting
the
Mortgaged Property (i.e., a single family residence, a 2-4 family
residence, a
unit in a condominium project or a unit in a planned unit
development or a
manufactured housing unit); (6) the original months to maturity or
the remaining
months to maturity from the Cut-off Date, in any case based on the
original
amortization schedule and, if different, the maturity expressed in
the same
manner but based on the actual amortization schedule; (7) with
respect to First
Lien Mortgage Loans, the Loan-to-Value Ratio at origination, and
with respect to
the Second Lien Mortgage Loans, the Combined Loan-to-Value Ratio;
(8) the
Mortgage Interest Rate as of the Cut-off Date; (9) the date on
which the
Scheduled Payment was due on the Mortgage Loan and, if such date is
not
consistent with the Due Date currently in effect, such Due Date;
(10) the stated
maturity date; (11) the amount of the Scheduled Payment as of the
Cut-off Date;
(12) the last payment date on which a Scheduled Payment was
actually applied to
pay interest and the outstanding principal balance; (13) the
original principal
amount of the Mortgage Loan; (14) the principal balance of the
Mortgage Loan as
of the close of business on the Cut-off Date, after deduction of
payments of
principal due and collected on or before the Cut-off Date; (15)
with respect to
Adjustable Rate Mortgage Loans, the Adjustment Date; (16) with
respect to
Adjustable Rate Mortgage Loans, the Gross Margin; (17) with respect
to
Adjustable Rate Mortgage Loans, the Lifetime Rate Cap under the
terms of the
Mortgage Note; (18) with respect to Adjustable Rate Mortgage Loans,
a code
indicating the type of Index; (19) with respect to Adjustable Rate
Mortgage
Loans, the Periodic Mortgage Interest Rate Cap under the terms of
the Mortgage
Note; (20) the type of Mortgage Loan (i.e., fixed rate, adjustable
rate, first
lien, second lien); (21) a code indicating the purpose of the loan
(i.e.,
purchase, rate and term refinance, equity take-out refinance); (22)
a code
indicating the documentation style (i.e., full documentation,
limited
documentation or stated income); (23) the loan credit
classification (as
described in the Underwriting Guidelines); (24) whether such
Mortgage Loan
provides for a Prepayment Premium; (25) the Prepayment Premium
period of such
Mortgage Loan, if applicable; (26) a description of the Prepayment
Premium, if
applicable; (27) the Mortgage Interest Rate as of origination; (28)
the credit
risk score (FICO score) at origination; (29) the date of
origination; (30) the
Mortgage Interest Rate adjustment period; (31) the Mortgage
Interest Rate floor;
(32) the Mortgage Interest Rate calculation method (i.e., 30/360,
simple
interest, other); (33) a code indicating whether the Mortgage Loan
has been
modified; (34) with respect to First Lien Mortgage Loans, the
current
Loan-to-Value Ratio, and with respect to Second Lien Mortgage
Loans, the current
Combined Loan-to-Value Ratio; (35) the one year payment history;
(36) the Due
Date for the first Scheduled Payment; (37) the original Scheduled
Payment due;
(38) with respect to the related Mortgagor, the debt-to-income
ratio; (39) the
Appraised Value of the Mortgaged Property; (40) the sales price of
the Mortgaged
Property if the Mortgage Loan was originated in connection with the
purchase of
the Mortgaged Property; and (41) a code indicating whether a
Mortgage Loan is or
has been 30 days delinquent. With respect to the Mortgage Loans in
the
aggregate: (1) the number of Mortgage Loans; (2) the current
aggregate
outstanding principal balance of the Mortgage Loans; (3) the
weighted average
Mortgage Interest Rate of the Mortgage Loans; and (4) the weighted
average
maturity of the Mortgage Loans.
Debt Service Reduction: With respect to any Mortgage Loan, a
reduction by a court of competent jurisdiction in a proceeding
under the United
States Bankruptcy Code in the Scheduled Payment for such Mortgage
Loan which
became final and non-appealable, except for such a reduction
resulting from a
Deficient Valuation or any reduction that results in a permanent
forgiveness of
principal.
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
United States
Bankruptcy Code.
Definitive Certificates: Any Certificate evidenced by a
Physical
Certificate and any Certificate issued in lieu of a Book-Entry
Certificate
pursuant to Section 5.02(e).
Delay Certificates: As specified in the Preliminary Statement.
Deleted Mortgage Loan: A Mortgage Loan that is removed from the
Trust pursuant to the terms of this Agreement.
Denomination: With respect to each Certificate, the amount set
forth
on the face thereof as the "Initial Certificate Balance of this
Certificate" or
the Percentage Interest appearing on the face thereof.
Depositor: GS Mortgage Securities Corp., a Delaware corporation,
and
its successors in interest.
Depository: The initial Depository shall be The Depository
Trust
Company, the nominee of which is CEDE & Co., as the registered
Holder of the
Book-Entry Certificates. The Depository shall at all times be a
"clearing
corporation" as defined in Section 8-102(a)(5) of the Uniform
Commercial Code of
the State of New York.
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 that
are rated "P-1" by Moody's, "A-1" by Standard & Poor's and
"F1+" by Fitch (in
each case, to the extent they are designated as Rating Agencies in
the
Preliminary Statement).
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, the
18th
day of the calendar month in which such Distribution Date occurs
or, if such day
is not a Business Day, the immediately preceding Business Day.
Distribution Account: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 3.27(b) in the name
of the Trustee
for the benefit of the Certificateholders and designated "Deutsche
Bank National
Trust Company in trust for registered holders of GSAMP Trust
2005-WMC3 Mortgage
Pass-Through Certificates, Series 2005-WMC3." Funds in the
Distribution Account
shall be held in trust for the Certificateholders for the uses and
purposes set
forth in this Agreement and may be invested in Permitted
Investments.
Distribution Date: The 25th day of each calendar month after
the
initial issuance of the Certificates, or if such day is not a
Business Day, the
next succeeding Business Day, commencing in January 2006.
Document Certification and Exception Report: The report attached
to
Exhibit F hereto.
Due Date: The day of the month on which the Scheduled Payment is
due
on a Mortgage Loan, exclusive of any days of grace.
Due Period: With respect to any Distribution Date, the period
commencing on the second day of the calendar month preceding the
month in which
the Distribution Date occurs and ending on the first day of the
calendar month
in which the Distribution Date occurs.
Eligible Account: Either (i) an account maintained with a federal
or
state-chartered depository institution or trust company that
complies with the
definition of Eligible Institution, (ii) an account maintained with
the
corporate trust department of a federal depository institution
or
state-chartered depository institution subject to regulations
regarding
fiduciary funds on deposit similar to Title 12 of the U.S. Code of
Federal
Regulation Section 9.10(b), which, in either case, has corporate
trust powers
and is acting in its fiduciary capacity or (iii) any other account
acceptable to
each Rating Agency. Eligible Accounts may bear interest, and may
include, if
otherwise qualified under this definition, accounts maintained with
the Trustee.
Each Eligible Account shall be a separate account.
Eligible Institution: A federal or state-chartered depository
institution or trust company the commercial paper, short-term debt
obligations,
or other short-term deposits of which are rated "A-1+" by Standard
& Poor's if
the amounts on deposit are to be held in the account for no more
than 365 days
(or at least "A-2" by Standard & Poor's if the amounts on
deposit are to be held
in the account for no more than 30 days), or the long-term
unsecured debt
obligations of which are rated at least "AA-" by Standard &
Poor's if the
amounts on deposit are to be held in the account for no more than
365 days, and
the commercial paper, short-term debt obligations or other
short-term deposits
of which are rated at least "P-1" by Moody's and "F1+" by Fitch (or
a comparable
rating if another Rating Agency is specified by the Depositor by
written notice
to the Servicer and the Trustee) (in each case, to the extent they
are
designated as Rating Agencies in the Preliminary Statement).
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA-Qualifying Underwriting: A best efforts or firm
commitment
underwriting or private placement that meets the requirements of
Prohibited
Transaction Exemption ("PTE") 2002-41, 67 Fed. Reg. 54487 (2002)
(or any
successor thereto), or any substantially similar administrative
exemption
granted by the U.S. Department of Labor.
ERISA-Restricted Certificate: As specified in the Preliminary
Statement.
Escrow Account: The Eligible Account or Accounts established
and
maintained pursuant to Section 3.09(b).
Escrow Payments: As defined in Section 3.09(b) of this
Agreement.
Event of Default: As defined in Section 7.01.
Excess Overcollateralized Amount: With respect to any
Distribution
Date, the excess, if any, of (a) the Overcollateralized Amount on
such
Distribution Date over (b) the Specified Overcollateralized Amount
for such
Distribution Date.
Excess Reserve Fund Account: The separate Eligible Account
created
and maintained by the Trustee pursuant to Sections 3.27(a) in the
name of the
Trustee for the benefit of the Regular Certificateholders and
designated
"Deutsche Bank National Trust Company in trust for registered
holders of GSAMP
Trust 2005-WMC3, Mortgage Pass-Through Certificates, Series
2005-WMC3." Funds in
the Excess Reserve Fund Account shall be held in trust for the
Regular
Certificateholders for the uses and purposes set forth in this
Agreement.
Amounts on deposit in the Excess Reserve Fund Account shall not be
invested.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Expense Fee Rate: As to each Mortgage Loan, a per annum rate
equal
to the sum of the Servicing Fee Rate and the Trustee Fee Rate.
Expense Fees: As to each Mortgage Loan, the sum of the Servicing
Fee
and the Trustee Fee.
Extra Principal Distribution Amount: As of any Distribution
Date,
the lesser of (x) the related Total Monthly Excess Spread for such
Distribution
Date and (y) the related Overcollateralization Deficiency for such
Distribution
Date.
Fannie Mae: The Federal National Mortgage Association and its
successors in interest.
Fannie Mae Guides: The Fannie Mae Seller's Guide and the Fannie
Mae
Servicer's Guide and all amendments or additions thereto.
FDIC: The Federal Deposit Insurance Corporation, and its
successors
in interest.
Final Recovery Determination: With respect to any defaulted
Mortgage
Loan or any REO Property (other than a Mortgage Loan or REO
Property purchased
by WMC or the Purchaser as contemplated by this Agreement), a
determination made
by the Servicer that all Insurance Proceeds, Condemnation Proceeds,
Liquidation
Proceeds and other payments or recoveries which the Servicer, in
its reasonable
good faith judgment, expects to be finally recoverable in respect
thereof have
been so recovered. The Servicer shall maintain records, prepared by
a Servicing
Officer, of each Final Recovery Determination made thereby.
Final Scheduled Distribution Date: The Final Scheduled
Distribution
Date for each Class of Certificates is the Distribution Date
occurring in
December 2035.
First Lien Mortgage Loan: Any Mortgage Loan secured by a first
lien
Mortgage on the related Mortgaged Property.
Fitch: Fitch, Inc., and its successors in interest. If Fitch is
designated as a Rating Agency in the Preliminary Statement, for
purposes of
Section 10.05(b) the address for notices to Fitch shall be Fitch,
Inc., One
State Street Plaza, New York, New York 10004, Attention: MBS
Monitoring - GSAMP
Trust 2005-WMC3, or such other address as Fitch may hereafter
furnish to the
Depositor, the Servicer, the Custodian and the Trustee.
Fixed Rate Mortgage Loan: A fixed rate Mortgage Loan.
Forbearance: As defined in Section 3.07(a).
Freddie Mac: The Federal Home Loan Mortgage Corporation, a
corporate
instrumentality of the United States created and existing under
Title III of the
Emergency Home Finance Act of 1970, as amended, and its successors
in interest.
Gross Margin: With respect to each Adjustable Rate Mortgage
Loan,
the fixed percentage amount set forth in the related Mortgage Note
to be added
to the applicable Index to determine the Mortgage Interest
Rate.
Group I Mortgage Loan: A Mortgage Loan in Loan Group 2.
Group I Sequential Trigger Event: With respect to any
Distribution
Date before the 25th Distribution Date, if the aggregate amount of
Realized
Losses incurred since the Cut-off Date through the last day of the
related
Prepayment Period divided by the aggregate Stated Principal Balance
of the
Mortgage Loans as of the Cut-off Date exceeds 1.40%, or if, on or
after the 25th
Distribution Date, a Trigger Event is in effect.
Group II Mortgage Loan: A Mortgage Loan in Loan Group 2.
High Cost Mortgage Loan: A Mortgage Loan that is (a) covered by
the
Home Ownership and Equity Protection Act of 1994, (b) identified,
classified or
characterized as "high cost," "threshold," "covered", or
"predatory" under any
other applicable state, federal or local law (or a similarly
identified,
classified or characterized loan using different terminology under
a law
imposing heightened regulatory scrutiny or additional legal
liability for
residential mortgage loans having high interest rates, points
and/or fees) or
(c) categorized as "High Cost" or "Covered" pursuant to Appendix E
of the
Standard & Poor's Glossary.
Home Loan: A Mortgage Loan categorized as "Home Loan" pursuant
to
Appendix E of Standard & Poor's Glossary.
Index: As to each Adjustable Rate Mortgage Loan, the index from
time
to time in effect for the adjustment of the Mortgage Interest Rate
set forth as
such on the related Mortgage Note.
Initial Certification: The Initial Certification submitted by
the
Custodian substantially in the form of Exhibit E.
Insurance Policy: With respect to any Mortgage Loan included in
the
Trust Fund, any insurance policy, including all riders and
endorsements thereto
in effect, including any replacement policy or policies for any
Insurance
Policies.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds
of
insurance policies insuring the Mortgage Loan or the related
Mortgaged Property.
Interest Accrual Period: With respect to each Class of LIBOR
Certificates and each Corresponding Class of Lower-Tier Regular
Interests and
each Corresponding Class of Upper Tier Regular Interests for any
Distribution
Date, the period commencing on the immediately preceding
Distribution Date (or,
for the initial Distribution Date, the Closing Date) and ending on
the day
immediately preceding the current Distribution Date. For purposes
of computing
interest accruals on each Class of LIBOR Certificates, each
Corresponding Class
of Lower Tier Regular Interest and each Corresponding Class of
Upper Tier
Regular Interest, each Interest Accrual Period has the actual
number of days in
such period and each year is assumed to have 360 days.
Interest Only Mortgage Loan: A Mortgage Loan for which the
related
Mortgage Note provides for Scheduled Payments of interest only for
a period of
time as specified in the related Mortgage Note.
Interest Rate Corridor Payments: With respect to each Corridor
Agreement and any Distribution Date, the amount, if any, required
to be paid by
the Corridor Agreement Provider on such Distribution Date pursuant
to such
Corridor Agreement.
Interest Remittance Amount: With respect to any Distribution
Date
and the Mortgage Loan in a Loan Group, that portion of Available
Funds
attributable to interest relating to the Mortgage Loans in such
Loan Group.
Investment Account: As defined in Section 3.12(a).
Late Collections: With respect to any Mortgage Loan and any Due
Period, all amounts received after the Remittance Date immediately
following
such Due Period, whether as late payments of Scheduled Payments or
as Insurance
Proceeds, Condemnation 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.
Lender: As defined in Section 10.07.
LIBOR: With respect to any Interest Accrual Period for the
LIBOR
Certificates, the rate determined by the Trustee on the related
LIBOR
Determination Date on the basis of the offered rate for one-month
U.S. dollar
deposits as such rate appears on Telerate Page 3750 as of 11:00
a.m. (London
time) on such 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
rates at
which one-month U.S. dollar deposits are offered by the Reference
Banks at
approximately 11:00 a.m. (London time) on such date to prime banks
in the London
interbank market. In such event, the Trustee shall request the
principal London
office of each of the Reference Banks to provide a quotation of its
rate. If at
least two such quotations are provided, the rate for that date will
be the
arithmetic mean of the quotations (rounded upwards if necessary to
the nearest
whole multiple of 1/16%). If fewer than two quotations are provided
as
requested, the rate for that date will be the arithmetic mean of
the rates
quoted by major banks in New York City, selected by the Trustee
(after
consultation with the Depositor), at approximately 11:00 a.m. (New
York City
time) on such date for one-month U.S. dollar deposits of leading
European banks.
LIBOR Certificates: As specified in the Preliminary Statement.
LIBOR Determination Date: With respect to any Interest Accrual
Period for the LIBOR Certificates, the second London Business Day
preceding the
commencement of such Interest Accrual Period.
Lifetime Rate Cap: The provision of each Mortgage Note related to
an
Adjustable Rate Mortgage Loan which provides for an absolute
maximum Mortgage
Interest Rate thereunder. The Mortgage Interest Rate during the
terms of each
Adjustable Rate Mortgage Loan shall not at any time exceed the
Mortgage Interest
Rate at the time of origination of such Adjustable Rate Mortgage
Loan by more
than the amount per annum set forth on the Mortgage Loan
Schedule.
Liquidated Mortgage Loan: With respect to any Distribution Date,
a
defaulted Mortgage Loan (including any REO Property) which was
liquidated or
charged off in the calendar month preceding the month of such
Distribution Date
and as to which the Servicer has certified (in accordance with this
Agreement)
that it has made a Final Recovery Determination.
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 coverage under this Agreement by reason of its being
purchased,
sold or replaced pursuant to or as contemplated by 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 coverage under this Agreement by reason of its being
purchased
pursuant to this Agreement.
Liquidation Proceeds: The amounts, other than Insurance
Proceeds,
Condemnation Proceeds or those received following the acquisition
of REO
Property, received in connection with the liquidation of a
defaulted Mortgage
Loan, whether through a trustee's sale, foreclosure sale or
otherwise, including
any Subsequent Recoveries.
Litton: Litton Loan Servicing LP, a Delaware limited
partnership,
and its successors in interest.
Loan Group: Either of Loan Group I or Loan Group II.
Loan Group I: The Group I Mortgage Loans.
Loan Group I WAC Cap: With respect to the Mortgage Loans as of
any
Distribution Date, the product of (i) the weighted average of the
Adjusted Net
Mortgage Interest Rates then in effect on the beginning of the
related Due
Period on the Group I Mortgage Loans, and (ii) a fraction, the
numerator of
which is 30 and the denominator of which is the actual number of
days in the
Interest Accrual Period related to such Distribution Date.
Loan Group
II: The Group II Mortgage Loans.
Loan Group II WAC Cap: With respect to the Mortgage Loans as of
any
Distribution Date, the product of (i) the weighted average of the
Adjusted Net
Mortgage Interest Rates then in effect on the beginning of the
related Due
Period on the Group II Mortgage Loans, and (ii) a fraction, the
numerator of
which is 30 and the denominator of which is the actual number of
days in the
Interest Accrual Period related to such Distribution Date.
Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan,
the
ratio (expressed as a percentage) of the original outstanding
principal amount
of the Mortgage Loan as of the Cut-off Date (unless otherwise
indicated), to
either (a) if the Mortgage Loan was made to finance the acquisition
of the
related Mortgaged Property, the least of (i) the purchase price of
the Mortgaged
Property, (ii) the Appraised Value of the Mortgaged Property at
origination, or
(iii) the Review Appraisal Value of the Mortgaged Property; or (b)
if the
Mortgage Loan was a refinancing or modification, the Appraised
Value of the
Mortgaged Property at the time of the refinancing or
modification.
London Business Day: Any day on which dealings in deposits of
United
States dollars are transacted in the London interbank market.
Lower-Tier Interest Rate: As described in the Preliminary
Statement.
Lower-Tier Principal Amount: As described in the Preliminary
Statement.
Lower-Tier Regular Interest: Each of the Class LT-A-1A, Class
LT-A-1B, Class LT-A-2A, Class LT-A-2B, Class LT-A-2C, Class LT-M-1,
Class
LT-M-2, Class LT-M-3, Class LT-M-4, Class LT-M-5, Class LT-M-6,
Class LT-B-1,
Class LT-B-2, Class LT-B-3, Class LT-Group I, Class LT-Group II and
Class
LT-Accrual Interests as described in the Preliminary Statement.
Lower Tier REMIC: As described in the Preliminary Statement.
MERS: As defined in Section 2.01(b).
MERS Designated Mortgage Loan: Mortgage Loans for which (a) WMC
or
the Purchaser has designated or will designate MERS as, and has
taken or will
take such action as is necessary to cause MERS to be, the mortgagee
of record,
as nominee for WMC or the Purchaser, in accordance with the MERS
Procedures
Manual and (b) WMC or the Purchaser has designated or will
designate the Trust
as the Investor on the MERS(R) System.
MERS Procedures Manual: The MERS Procedures Manual, as it may
be
amended, supplemented or otherwise modified from time to time.
MERS(R) System: MERS mortgage electronic registry system, as
more
particularly described in the MERS Procedures Manual.
Monthly Statement: The statement made available to the
Certificateholders pursuant to Section 4.03.
Moody's: Moody's
Investors Service, Inc., and its successors in
interest. If Moody's is designated as a Rating Agency in the
Preliminary
Statement, for purposes of Section 10.05(b) the address for notices
to Moody's
shall be Moody's Investors Service, Inc., 99 Church Street, New
York, New York
10007, Attention: Residential Mortgage Pass-Through Group, or such
other address
as Moody's may hereafter furnish to the Depositor, the Servicer,
the Custodian
and the Trustee.
Mortgage: The mortgage, deed of trust or other instrument
identified
on the Mortgage Loan Schedule as securing a Mortgage Note,
including all riders
thereto.
Mortgage File: The items pertaining to a particular Mortgage
Loan
contained in either the Servicing File or Custodial File.
Mortgage Interest Rate: The annual rate of interest borne on a
Mortgage Note with respect to each Mortgage Loan.
Mortgage Loan: An individual Mortgage Loan which is the subject
of
this Agreement, each Mortgage Loan originally sold and subject to
this Agreement
being identified on the Mortgage Loan Schedule, which Mortgage Loan
includes,
without limitation, the Mortgage File, the Custodial File, the
Servicing File,
the Scheduled Payments, Principal Prepayments, Liquidation
Proceeds,
Condemnation Proceeds, Insurance Proceeds, REO Disposition
proceeds, Prepayment
Premiums and all other rights, benefits, proceeds and obligations
arising from
or in connection with such Mortgage Loan, excluding replaced or
repurchased
Mortgage Loans.
Mortgage Loan Documents: The mortgage loan documents pertaining
to
each Mortgage Loan.
Mortgage Loan Schedule: A schedule of Mortgage Loans delivered
to
the Trustee on the Closing Date and referred to on Schedule I, such
schedule
setting forth the following information with respect to each
Mortgage Loan as of
the Cut-off Date: (1) the Purchaser's Mortgage Loan identifying
number; (2) the
Mortgagor's name; (3) the street address of the Mortgaged Property
including the
city, state and zip code; (4) a code indicating whether the
Mortgaged Property
is owner-occupied, a second home or investment property; (5) the
number and type
of residential units constituting the Mortgaged Property (i.e., a
single family
residence, a 2-4 family residence, a unit in a condominium project
or a unit in
a planned unit development or a manufactured housing unit); (6) the
original
months to maturity or the remaining months to maturity from the
Cut-off Date, in
any case based on the original amortization schedule and, if
different, the
maturity expressed in the same manner but based on the actual
amortization
schedule; (7) with respect to First Lien Mortgage Loans, the
Loan-to-Value Ratio
at origination, and with respect to Second Lien Mortgage Loans, the
Combined
Loan-to-Value Ratio, at origination; (8) the Mortgage Interest Rate
as of the
Cut-off Date; (9) the date on which the Scheduled Payment was due
on the
Mortgage Loan and, if such date is not consistent with the Due Date
currently in
effect, such Due Date; (10) the stated maturity date; (11) the
amount of the
Scheduled Payment as of the Cut-off Date; (12) the last payment
date on which a
Scheduled Payment was actually applied to pay interest and the
outstanding
principal balance; (13) the original principal amount of the
Mortgage Loan; (14)
the principal balance of the Mortgage Loan as of the close of
business on the
Cut-off Date, after deduction of payments of principal due and
collected on or
before the Cut-off Date; (15) with respect to Adjustable Rate
Mortgage Loans,
the Adjustment Date; (16) with respect to Adjustable Rate Mortgage
Loans, the
Gross Margin; (17) with respect to Adjustable Rate Mortgage Loans,
the Lifetime
Rate Cap under the terms of the Mortgage Note; (18) with respect to
Adjustable
Rate Mortgage Loans, a code indicating the type of Index; (19) with
respect to
Adjustable Rate Mortgage Loans, the Periodic Mortgage Interest Rate
Cap under
the terms of the Mortgage Note; (20) with respect to Adjustable
Rate Mortgage
Loans, the Periodic Mortgage Interest Rate Floor under the terms of
the Mortgage
Note; (21) the type of Mortgage Loan (i.e., fixed rate, adjustable
rate, first
lien, second lien); (22) a code indicating the purpose of the loan
(i.e.,
purchase, rate and term refinance, equity take-out refinance); (23)
a code
indicating the documentation style (i.e., full documentation,
limited
documentation or stated income); (24) the loan credit
classification (as
described in the Underwriting Guidelines); (25) whether such
Mortgage Loan
provides for a Prepayment Premium; (26) the Prepayment Premium
period of such
Mortgage Loan, if applicable; (27) a description of the Prepayment
Premium, if
applicable; (28) the Mortgage Interest Rate as of origination; (29)
the credit
risk score (FICO score) at origination; (30) the date of
origination; (31) the
Mortgage Interest Rate adjustment period; (32) the Mortgage
Interest Rate
adjustment percentage; (33) the Mortgage Interest Rate floor; (34)
the Mortgage
Interest Rate calculation method (i.e., 30/360, simple interest,
other); (35) a
code indicating whether the Mortgage Loan is assumable; (36) a code
indicating
whether the Mortgage Loan has been modified; (37) the one year
payment history;
(38) the Due Date for the first Scheduled Payment; (39) the
original Scheduled
Payment due; (40) with respect to the related Mortgagor, the
debt-to-income
ratio; (41) the Appraised Value of the Mortgaged Property; (42) the
sales price
of the Mortgaged Property if the Mortgage Loan was originated in
connection with
the purchase of the Mortgaged Property; (43) a code indicating if
the Mortgage
Loan is an Interest Only Mortgage Loan; (44) a code indicating
whether such
Mortgage Loan is a Home Loan; (45) a code indicating whether a
Mortgage Loan is
or has been 30 days delinquent; (46) MERS Indemnification Number;
and (47) Loan
Group. With respect to the related Mortgage Loans in the aggregate:
(1) the
number of Mortgage Loans; (2) the current aggregate outstanding
principal
balance of the Mortgage Loans; (3) the weighted average Mortgage
Interest Rate
of the Mortgage Loans; and (4) the weighted average maturity of the
Mortgage
Loans.
Mortgage Note: The note or other evidence of the indebtedness of
a
Mortgagor under a Mortgage Loan, including all riders thereto.
Mortgaged Property: The real property (or leasehold estate, if
applicable) identified on the Mortgage Loan Schedule as securing
repayment of
the debt evidenced by a Mortgage Note.
Mortgagor: The obligor(s) on a Mortgage Note.
Net Monthly Excess Cash Flow: For any Distribution Date the
amount
remaining for distribution pursuant to Section 4.02(a)(iii) (before
giving
effect to distributions pursuant to such subsection).
Net Prepayment Interest Shortfall: For any Distribution Date,
the
amount by which the sum of the Prepayment Interest Shortfalls for
such
Distribution Date exceeds the sum of the Compensating Interest
payments made
with respect to such Distribution Date.
NIM Issuer: The entity established as the issuer of the NIM
Securities.
NIM Securities: Any debt securities secured or otherwise backed
by
some or all of the Class X and Class P Certificates that are rated
by one or
more Rating Agencies.
NIM Trustee: The trustee for the NIM Securities.
90+ Day Delinquent Mortgage Loan: Each Mortgage Loan with respect
to
which any portion of a Scheduled Payment is, as of the last day of
the prior Due
Period, three months or more past due (without giving effect to any
grace
period), including each Mortgage Loan in foreclosure, all REO
Property and each
Mortgage Loan for which the Mortgagor has filed for bankruptcy.
Non-Delay Certificates: As specified in the Preliminary
Statement.
Non-Permitted Transferee: As defined in Section 8.11(e).
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, will not or, in the
case of a
proposed P&I Advance, would not be ultimately recoverable from
related late
payments, Insurance Proceeds, Condemnation Proceeds or Liquidation
Proceeds on
such Mortgage Loan or REO Property as provided herein.
Nonrecoverable Servicing Advance: Any Servicing Advances
previously
made or proposed to be made in respect of a Mortgage Loan or REO
Property,
which, in the good faith business judgment of the Servicer, will
not or, in the
case of a proposed Servicing Advance, would not, be ultimately
recoverable from
related Insurance Proceeds, Condemnation Proceeds, Liquidation
Proceeds or
otherwise.
Non-Rule 144A Investment Letter: As defined in Section 5.02(b).
Notice of Final Distribution: The notice to be provided pursuant
to
Section 9.02 to the effect that final distribution on any of the
Certificates
shall be made only upon presentation and surrender thereof.
Offered Certificates: As specified in the Preliminary
Statement.
Officer's
Certificate: A certificate signed by an officer of the
Servicer with responsibility for the servicing of the Mortgage
Loans and listed
on a list delivered to the Trustee pursuant to this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be
in-house counsel for the Servicer or a Subservicer, reasonably
acceptable to the
Trustee; provided, that any Opinion of Counsel relating to (a)
qualification of
any Trust REMIC as a REMIC or (b) compliance with the REMIC
Provisions, must be
(unless otherwise stated in such Opinion of Counsel) an opinion of
counsel who
(i) is in fact independent of the Servicer of the Mortgage Loans,
(ii) does not
have any material direct or indirect financial interest in the
Servicer of the
Mortgage Loans or in an Affiliate of either and (iii) is not
connected with the
Servicer of the Mortgage Loans as an officer, employee, director or
person
performing similar functions.
Optional Termination Date: The date determined by the Servicer
and
specified in a written notice to the Trustee, which may occur on or
after the
Distribution Date on which the aggregate Stated Principal Balance
of the
Mortgage Loans, as of the last day of the related Due Period, is
equal to 10.00%
or less of the Cut-off Date Pool Principal Balance.
OTS: Office of Thrift Supervision, and any successor thereto.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore executed and
authenticated under
this Agreement except:
(i) Certificates theretofore canceled by the Trustee or delivered
to
the Trustee for cancellation; and
(ii) Certificates in exchange for which or in lieu of which
other
Certificates have been executed and delivered by the Trustee
pursuant to this
Agreement.
Outstanding Mortgage Loan: As of any Due Date, a Mortgage Loan
with
a Stated Principal Balance greater than zero which was not the
subject of a
Principal Prepayment in Full prior to such Due Date and which did
not become a
Liquidated Mortgage Loan prior to such Due Date.
Overcollateralized Amount: As of any Distribution Date, the
excess,
if any, of (a) the aggregate Stated Principal Balance of the
Mortgage Loans for
such Distribution Date over (b) the aggregate of the Class
Certificate Balances
of the Certificates as of such Distribution Date (after giving
effect to the
payment of the Principal Remittance Amount on such Certificates on
such
Distribution Date).
Overcollateralization Deficiency: With respect to any
Distribution
Date, the excess, if any, of (a) the Specified Overcollateralized
Amount
applicable to such Distribution Date over (b) the
Overcollateralized Amount
applicable to such Distribution Date.
Overcollateralization Floor: With respect to any Distribution
Date,
0.50% of the aggregate Stated Principal Balance of the Mortgage
Loans as of the
Cut-off Date.
Overcollateralization Reduction Amount: With respect to any
Distribution Date, an amount equal to the lesser of (a) the
Excess
Overcollateralized Amount and (b) the Net Monthly Excess Cash
Flow.
Ownership Interest: As to any Residual Certificate, any
ownership
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.
P&I Advance: As to any Mortgage Loan or REO Property, any
advance
made by the Servicer in respect of any Remittance Date representing
the
aggregate of all payments of principal and interest, net of the
Servicing Fee,
that were due during the related Due Period on the Mortgage Loans
and that were
delinquent on the related Remittance Date, plus certain amounts
representing
assumed payments not covered by any current net income on the
Mortgaged
Properties acquired by foreclosure or deed in lieu of foreclosure
as determined
pursuant to Section 4.01 (which advance shall not include principal
or interest
shortfalls due to application of the Servicemembers Civil Relief
Act).
Pass-Through Rate: For each Class of Regular Certificates, each
Lower-Tier Regular Interest and each Upper-Tier Regular Interest,
the per annum
rate set forth or calculated in the manner described in the
Preliminary
Statement.
Percentage Interest: As to any Certificate, the percentage
interest
evidenced thereby in distributions required to be made on the
related Class,
such percentage interest being set forth on the face thereof or
equal to the
percentage obtained by dividing the Denomination of such
Certificate by the
aggregate of the Denominations of all Certificates of the same
Class.
Periodic Mortgage Interest Rate Cap: With respect to each
Adjustable
Rate Mortgage Loan, the provision of each Mortgage Note related to
an Adjustable
Rate Mortgage Loan which provides for an absolute maximum amount by
which the
Mortgage Interest Rate therein may increase or decrease on an
Adjustment Date
above or below the Mortgage Interest Rate previously in effect. The
Periodic
Mortgage Interest Rate Cap for each Adjustable Rate Mortgage Loan
is the rate
set forth on the Mortgage Loan Schedule.
Periodic Mortgage Interest Rate Floor: With respect to each
Adjustable Rate Mortgage Loan, the provision of each Mortgage Note
related to an
Adjustable Rate Mortgage Loan which provides for an absolute
minimum amount by
which the Mortgage Interest Rate therein may increase or decrease
on an
Adjustment Date above or below the Mortgage Interest Rate
previously in effect.
The Periodic Mortgage Interest Rate Floor for each Adjustable Rate
Mortgage Loan
is the rate set forth on the Mortgage Loan Schedule.
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 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) demand and time deposits in, certificates of deposit of,
or
bankers'
acceptances (which shall each have an original maturity of not
more than
90 days and, in the case of bankers' acceptances, shall in no
event have
an original maturity of more than 365 days or a remaining
maturity
of more than 30 days) denominated in United States dollars and
issued by
any Depository Institution and rated "A-1+" by Standard &
Poor's,
"P-1" by Moody's and "F1+" by Fitch (in each case, to the
extent
they are
designated as Rating Agencies in the Preliminary Statement);
(iii) repurchase obligations with respect to any security
described
in clause
(i) above entered into with a Depository Institution (acting as
principal);
(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, including money market funds
advised by
the Depositor or the Trustee or an Affiliate thereof, that have
been rated
"Aaa" by Moody's, "AAAm" or "AAAm-G" by Standard & Poor's
and
at least
"AA" by Fitch (in each case, to the extent they are designated
as
Rating
Agencies in the Preliminary Statement); 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 "Aaa" or "AAA" rated securities;
provided, however, that no instrument described hereunder shall
evidence either
the right to receive (a) only interest with respect to the
obligations
underlying such instrument or (b) both principal and interest
payments derived
from obligations underlying such instrument and the interest and
principal
payments with respect to such instrument provide a yield to
maturity at par
greater than 120% of the yield to maturity at par of the underlying
obligations.
Permitted Transferee: Any Person other than (i) the United
States,
any State or political subdivision thereof, or any agency or
instrumentality of
any of the foregoing, (ii) a foreign government, international
organization or
any agency or instrumentality of either of the foregoing, (iii) an
organization
(except certain farmers' cooperatives described in Section 521 of
the Code)
which is exempt from tax imposed by Chapter 1 of the Code
(including the tax
imposed by Section 511 of the Code on unrelated business taxable
income) on any
excess inclusions (as defined in Section 860E(c)(1) of the Code)
with respect to
any Residual Certificate, (iv) rural electric and telephone
cooperatives
described in Section 1381(a)(2)(C) of the Code, (v) a Person that
is not a U.S.
Person or a U.S. Person with respect to whom income from a Residual
Certificate
is attributable to a foreign permanent establishment or fixed base
(within the
meaning of an applicable income tax treaty) of such Person or any
other U.S.
Person, (vi) an "electing large partnership" within the meaning of
Section 775
of the Code and (vii) any other Person so designated by the
Depositor based upon
an Opinion of Counsel that the Transfer of an Ownership Interest in
a Residual
Certificate to such Person may cause any Trust REMIC to fail to
qualify as a
REMIC at any time that the Certificates are outstanding. The terms
"United
States," "State" and "international organization" shall have the
meanings set
forth in Section 7701 of the Code or successor provisions. A
corporation will
not be treated as an instrumentality of the United States or of any
State or
political subdivision thereof for these purposes if all of its
activities are
subject to tax and, with the exception of Freddie Mac, a majority
of its board
of directors is not selected by such government unit.
Person: Any individual, corporation, partnership, joint
venture,
association, limited liability company, joint-stock company,
trust,
unincorporated organization or government, or any agency or
political
subdivision thereof.
Physical Certificates: As specified in the Preliminary
Statement.
Plan: As defined in Section 5.02(b).
Pool Stated Principal Balance: As to any Distribution Date, the
aggregate of the Stated Principal Balances of the Mortgage Loans
for such
Distribution Date that were Outstanding Mortgage Loans on the Due
Date in the
related Due Period.
Prepayment Interest Shortfall: With respect to any Remittance
Date,
the sum of, for each Mortgage Loan that was, during the related
Prepayment
Period, the subject of a Principal Prepayment that was applied by
the 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
the product of (a) the Mortgage Interest Rate net of the Servicing
Fee Rate for
such Mortgage Loan, (b) the amount of the Principal Prepayment for
such Mortgage
Loan, (c) 1/360 and (d) the number of days commencing on the date
on which such
Principal Prepayment was applied and ending on the last day of the
related
Prepayment Period.
Prepayment Period: With respect to any Distribution Date, the
calendar month preceding the calendar month in which such
Distribution Date
occurs.
Prepayment Premium: Any prepayment premium, penalty or charge
collected by the Servicer with respect to a Mortgage Loan from a
Mortgagor in
connection with any voluntary Principal Prepayment pursuant to the
terms of the
related Mortgage Note.
Principal Distribution Amount: For any Distribution Date, the sum
of
(i) the Basic Principal Distribution Amount for such Distribution
Date and (ii)
the Extra Principal Distribution Amount for such Distribution
Date.
Principal Prepayment: Any full or partial payment or other
recovery
of principal on a Mortgage Loan (including upon liquidation of a
Mortgage Loan)
which is received in advance of its scheduled Due Date, excluding
any Prepayment
Premium and which is not accompanied by an amount of interest
representing
scheduled interest due on any date or dates in any month or months
subsequent to
the month of prepayment.
Principal Prepayment in Full: Any Principal Prepayment made by
a
Mortgagor of the entire principal balance of a Mortgage Loan.
Principal Remittance Amount: With respect to any Distribution
Date,
the amount equal to the sum of the following amounts (without
duplication) with
respect to the related Due Period: (i) each Scheduled Payment of
principal on a
Mortgage Loan due during such Due Period and received by the
Servicer on or
prior to the related Determination Date or advanced by the Servicer
for the
related Remittance Date, (ii) all Principal Prepayments received
during the
related Prepayment Period, (iii) all Liquidation Proceeds,
Condemnation Proceeds
and Insurance Proceeds on the Mortgage Loans allocable to principal
actually
collected by the Servicer during the related Prepayment Period,
(iv) the portion
of the Repurchase Price allocable to principal with respect to each
Deleted
Mortgage Loan, the repurchase obligation for which arose during the
related
Prepayment Period, that was repurchased during the period from the
prior
Distribution Date through the Remittance Date for the current
Distribution Date,
(v) the portion of all Substitution Adjustment Amounts allocable to
principal
with respect to the substitutions of Mortgage Loans that occur
during the
calendar month in which such Distribution Date occurs, and (vi) the
allocable
portion of the proceeds received with respect to the termination of
the Trust
Fund pursuant to clause (a) of Section 9.01 (to the extent such
proceeds relate
to principal).
Privacy Laws: Title V of the Gramm Leach Bliley Act of 1999, as
amended, and all applicable regulations promulgated thereunder.
Private Certificates: As specified in the Preliminary
Statement.
Prospectus Supplement: The Prospectus Supplement, dated December
22,
2005, relating to the Offered Certificates.
PTCE 95-60: As defined in Section 5.02(b).
PUD: A planned unit development.
Purchase Agreement: The Flow Mortgage Loan Purchase and
Warranties
Agreement, dated as of July 27, 2005, between the Purchaser and
WMC.
Purchaser: Goldman Sachs Mortgage Company, a New York limited
partnership, and its successors in interest, as purchaser of the
Mortgage Loans
under the Purchase Agreement.
Rating Agency: Each of the Rating Agencies specified in the
Preliminary Statement. If such organization or a successor is no
longer in
existence, "Rating Agency" shall be such nationally recognized
statistical
rating organization, or other comparable Person, as is designated
by the
Depositor, notice of which designation shall be given to the
Trustee. References
herein to a given rating or rating category of a Rating Agency
shall mean such
rating category without giving effect to any modifiers. For
purposes of Section
10.05(b), the addresses for notices to each Rating Agency shall be
the address
specified therefor in the definition corresponding to the name of
such Rating
Agency, or such other address as either such Rating Agency may
hereafter furnish
to the Depositor and the Servicer.
Realized Losses: With respect to any date of determination and
any
Liquidated Mortgage Loan, the amount, if any, by which (a) the
unpaid principal
balance of such Liquidated Mortgage Loan together with accrued and
unpaid
interest thereon exceeds (b) the Liquidation Proceeds with respect
thereto net
of the expenses incurred by the Servicer in connection with the
liquidation of
such Liquidated Mortgage Loan and net of any amount of unreimbursed
Servicing
Advances with respect to such Liquidated Mortgage Loan.
Record Date: With respect to any Distribution Date, the close
of
business on the last Business Day of the related Interest Accrual
Period;
provided, however, that for any Certificate issued in definitive
form, the
Record Date shall be the close of business on the last Business Day
of the month
preceding the month in which such applicable Distribution Date
occurs.
Reference Bank: As defined in Section 4.04.
Regular Certificates: As specified in the Preliminary
Statement.
Relief Act Interest Shortfall: With respect to any Distribution
Date
and any Mortgage Loan, any reduction in the amount of interest or
principal
collectible on such Mortgage Loan for the most recently ended Due
Period as a
result of the application of the Servicemembers Civil Relief Act or
any similar
state or local statutes.
REMIC: A "real estate mortgage investment conduit" within the
meaning of Section 860D of the Code.
REMIC Provisions: Provisions of the federal income tax law
relating
to real estate mortgage investment conduits, which appear at
Sections 860A
through 860G of Subchapter M of Chapter 1 of the Code, and related
provisions,
and regulations promulgated thereunder, as the foregoing may be in
effect from
time to time as well as provisions of applicable state laws.
Remittance Date: With respect to any Distribution Date, no
later
than 12:30 PM, Central Time on the Business Day immediately
preceding such
Distribution Date.
REO Disposition: The final sale by the Servicer of any REO
Property.
REO Imputed Interest: As to any REO Property, for any period,
an
amount equivalent to interest (at the Mortgage Interest Rate net of
the
Servicing Fee Rate that would have been applicable to the related
Mortgage Loan
had it been outstanding) on the unpaid principal balance of the
Mortgage Loan as
of the date of acquisition thereof (as such balance is reduced
pursuant to
Section 3.15 by any income from the REO Property treated as a
recovery of
principal).
REO Property: A Mortgaged Property acquired by the Trust Fund
through foreclosure or deed-in-lieu of foreclosure in connection
with a
defaulted Mortgage Loan.
Reporting Date: The 18th day of each calendar month or the
immediately following Business Day if the 18th is not a Business
Day.
Repurchase Price: With respect to any Mortgage Loan repurchased
by
(a) the Purchaser, an amount equal to the sum of (i) the unpaid
principal
balance of such Mortgage Loan as of the date of repurchase, (ii)
interest on
such unpaid principal balance of such Mortgage Loan at the Mortgage
Interest
Rate from the last date through which interest has been paid and
distributed to
the Trustee to the date of repurchase, (iii) all unreimbursed
Servicing
Advances, (iv) all expenses incurred by the Servicer, the Trust or
the Trustee,
as the case may be, in respect of a breach or defect, including,
without
limitation, expenses arising out of the Servicer's or Trustee's, as
the case may
be, enforcement of the Purchaser's repurchase obligation, to the
extent not
included in clause (iii), and (v) any costs and damages incurred by
the Trust in
connection with any violation by such Mortgage Loan of any
predatory lending law
or abusive lending law or (b) WMC, the "Repurchase Price" as that
term is
defined in the Underlying Agreements.
Request for Release: The Request for Release submitted by the
Servicer to the Custodian, with a copy to the Trustee,
substantially in the form
of Exhibit K.
Residual Certificates: As specified in the Preliminary
Statement.
Responsible Officer: When used with respect to the Trustee, any
vice
president, any assistant vice president, any assistant secretary,
any assistant
treasurer, any associate or any other officer of the Trustee
customarily
performing functions similar to those performed by any of the above
designated
officers who at such time shall be officers to whom, with respect
to a
particular matter, such matter is referred because of such
officer's knowledge
of and familiarity with the particular subject and who shall have
direct
responsibility for the administration of this Agreement.
Review Appraisal Value: As defined in the Underwriting
Guidelines.
Rule 144A Letter: As defined in Section 5.02(b).
Scheduled Payment: The scheduled monthly payment on a Mortgage
Loan
due on any Due Date allocable to principal and/or interest on such
Mortgage Loan
which, unless otherwise specified herein, shall give effect to any
related Debt
Service Reduction and any Deficient Valuation that affects the
amount of the
monthly payment due on such Mortgage Loan.
Second Lien Mortgage Loan: A Mortgage Loan secured by a second
lien
Mortgage on the related Mortgaged Property.
Securities Act: The Securities Act of 1933, as amended.
Senior Enhancement Percentage: With respect to any Distribution
Date, the percentage obtained by dividing (x) the sum of (i) the
aggregate Class
Certificate Balance of the Subordinated Certificates and (ii)
the
Overcollateralized Amount (in each case after taking into account
the
distributions of the Principal Distribution Amount for such
Distribution Date)
by (y) the aggregate Stated Principal Balance of the Mortgage Loans
for such
Distribution Date.
Senior Specified Enhancement Percentage: As of any date of
determination, 48.00%.
Servicer: Litton.
Servicer Remittance Report: As defined in Section 4.03(d).
Servicer's Assignee: As defined in Section 10.07.
Servicing Advances: The reasonable "out-of-pocket" costs and
expenses (including legal fees) incurred by the Servicer in the
performance of
its servicing obligations in connection with a default, delinquency
or other
unanticipated event, including, but not limited to, the cost of (i)
the
preservation, restoration, inspection and protection of a Mortgaged
Property,
(ii) any enforcement or judicial proceedings, including
foreclosures and
litigation, in respect of a particular Mortgage Loan, (iii) the
management
(including reasonable fees in connection therewith) and liquidation
of any REO
Property and (iv) the performance of its obligations under Sections
3.01, 3.09,
3.13 and 3.15. The Servicer shall not be required to make any
Nonrecoverable
Servicing Advances.
Servicing Fee: With respect to each Mortgage Loan and any
Distribution Date, an amount equal to the product of (i)
one-twelfth of the
Servicing Fee Rate, and (ii) the Stated Principal Balance of such
Mortgage Loan
as of the first day of the calendar month preceding the month in
which such
Distribution Date occurs. Such fee shall be payable monthly, and
shall be pro
rated for any portion of a month during which the Mortgage Loan is
serviced by
the Servicer under this Agreement. The Servicing Fee is payable
solely from the
interest portion (including recoveries with respect to interest
from Liquidation
Proceeds, Insurance Proceeds, Condemnation Proceeds and proceeds
received with
respect to REO Properties, to the extent permitted by Section 3.11)
of such
Scheduled Payment collected by the Servicer or as otherwise
provided under
Section 3.11.
Servicing Fee Rate: With respect to each Mortgage Loan, 0.50%
per
annum.
Servicing File: With respect to each Mortgage Loan, the file
retained by the Servicer consisting of originals or copies of all
documents in
the Mortgage File which are not delivered to the Trustee in the
Custodial File
and copies of the Mortgage Loan Documents set forth in Exhibit L
hereto.
Servicing Officer: Any officer of the Servicer involved in, or
responsible for, the administration and servicing of the Mortgage
Loans whose
name and facsimile signature appear on a list of servicing officers
furnished to
the Trustee by the Servicer on the Closing Date pursuant to this
Agreement, as
such list may from time to time be amended.
Servicing Rights: Any and all of the following: (a) all rights
and
obligations to service the Mortgage Loans; (b) any compensation for
servicing
the Mortgage Loans; (c) any late fees, penalties or similar
payments with
respect to the Mortgage Loans (other than prepayment penalties);
(d) all
agreements or documents creating, defining or evidencing any such
servicing
rights to the extent they relate to such servicing rights; (e) any
interest on
Escrow Accounts allowed by law or other similar payments with
respect to the
Mortgage Loans and any amounts actually collected with respect
thereto; (f) all
accounts and other rights to payment related to any of the property
described in
this paragraph; (g) the right to possess and use any and all
servicing files,
servicing records, data tapes, computer records, or other
information pertaining
to the Mortgage Loans to the extent relating to the past, present
or prospective
servicing of the Mortgage Loans; and (h) all rights, powers and
privileges
incident to any of the foregoing.
Servicing Rights Pledgee: One or more lenders, selected by the
Servicer, to which the Servicer may pledge and assign all of its
right, title
and interest in, to and under this Agreement pursuant to and as
provided in
Section 6.06, including without limitation, JPMorgan Chase Bank,
National
Association as the representative of certain lenders.
Similar Law: As defined in Section 5.02(b).
60+ Day Delinquent Mortgage Loan: Each Mortgage Loan with respect
to
which any portion of a Scheduled Payment is, as of the last day of
the prior Due
Period, two months or more past due (without giving effect to any
grace period),
each Mortgage Loan in foreclosure, all REO Property and each
Mortgage Loan for
which the Mortgagor has filed for bankruptcy.
Specified Overcollateralized Amount: Prior to the Stepdown Date,
an
amount equal to 4.35% of the Cut-off Date Pool Principal Balance.
On and after
the Stepdown Date, an amount equal to 8.70% of the aggregate Stated
Principal
Balance of the Mortgage Loans for such Distribution Date, subject,
until the
Class Certificate Balance of each Class of LIBOR Certificates has
been reduced
to zero, to a minimum amount equal to the Overcollateralization
Floor; provided,
however, that if, on any Distribution Date, a Trigger Event has
occurred, the
Specified Overcollateralized Amount shall not be reduced to the
applicable
percentage of the then current aggregate Stated Principal Balance
of the
Mortgage Loans until the Distribution Date on which a Trigger Event
is no longer
occurring. On and after the date on which the Class Certificate
Balance of each
Class of LIBOR Certificates has been reduced to zero, the
Specified
Overcollateralized Amount shall thereafter equal zero.
SPV: As defined in Section 10.07.
Standard & Poor's: Standard & Poor's Ratings Services, a
division of
The McGraw-Hill Companies, Inc., and its successors in interest. If
Standard &
Poor's is designated as a Rating Agency in the Preliminary
Statement, for
purposes of Section 10.05(b) the address for notices to Standard
& Poor's shall
be Standard & Poor's, 55 Water Street, New York, New York
10041, Attention:
Residential Mortgage Surveillance Group - GSAMP Trust 2005-WMC3, or
such other
address as Standard & Poor's may hereafter furnish to the
Depositor, the
Servicer, the Custodian and the Trustee.
Standard & Poor's Glossary: Version 5.6(b) of the Standard
& Poor's
LEVELS(R) Glossary.
Start-up Day: As defined in Section 2.06.
Stated Principal Balance: As to each Mortgage Loan and as of
any
date of determination, (i) the principal balance of the Mortgage
Loan at the
Cut-off Date after giving effect to payments of principal due on or
before such
date, minus (ii) all amounts previously remitted to the Trustee
with respect to
the related Mortgage Loan representing payments or recoveries of
principal
including advances in respect of Scheduled Payments of principal,
and plus (iii)
any amounts added to the unpaid principal balance of such Mortgage
Loan in
connection with a modification thereof. For purposes of any
Distribution Date,
the Stated Principal Balance of any Mortgage Loan will give effect
to any
Scheduled Payments of principal received by the Servicer on or
prior to the
related Determination Date or advanced by the Servicer for the
related
Remittance Date and any unscheduled principal payments and other
unscheduled
principal collections received during the related Prepayment
Period, and the
Stated Principal Balance of any Mortgage Loan that has prepaid in
full or has
become a Liquidated Mortgage Loan during the related Prepayment
Period shall be
zero.
Stepdown Date: The earlier to occur of (a) the date on which
the
aggregate Class Certificate Balances of the Class A Certificates
have been
reduced to zero, and (b) the later to occur of (i) the Distribution
Date in
January 2009, and (ii) the first Distribution Date on which the
Senior
Enhancement Percentage is greater than or equal to the Senior
Specified
Enhancement Percentage.
Subordinated Corridor Agreement: The interest rate corridor
agreement with respect to the Class M-1, Class M-2, Class M-3,
Class M-4, Class
M-5, Class M-6, Class B-1, Class B-2 and Class B-3 Certificates,
dated December
28, 2005, between the Purchaser and the Corridor Agreement
Provider.
Subordinated Certificates: As specified in the Preliminary
Statement.
Subsequent Recoveries: Amounts received with respect to any
Liquidated Mortgage Loan after it has become a Liquidated Mortgage
Loan.
Subservicer: As defined in Section 3.02(a).
Subservicing Account: As defined in Section 3.08.
Subservicing Agreements: As defined in Section 3.02(a).
Substitute Mortgage Loan: A Mortgage Loan eligible to be
substituted
for a Deleted Mortgage Loan pursuant to the terms of the Underlying
Agreements.
Substitution Adjustment Amount: Any amount required to be paid
in
connection with a Substitute Mortgage Loan pursuant to the
Underlying
Agreements.
Tax Service Contract: As defined in Section 3.09(a).
Telerate Page 3750: The display page currently so designated on
the
Bridge Telerate Service (or such other page as may replace that
page on that
service for displaying comparable rates or prices).
Termination Price: As defined in Section 9.01.
Total Monthly Excess Spread: As to any Distribution Date, an
amount
equal to the excess if any, of (i) the interest collected on the
Mortgage Loans
received by the Servicer on or prior to the related Determination
Date or
advanced by the Servicer for the related Remittance Date (net of
Expense Fees)
over (ii) the sum of the interest payable to the Classes of LIBOR
Certificates
on such Distribution Date pursuant to Section 4.02(a)(i).
Transfer: Any direct or indirect transfer or sale of any
Ownership
Interest in a Residual Certificate.
Transfer Affidavit: As defined in Section 5.02(c).
Transferor Certificate: As defined in Section 5.02(b).
Trigger Event: With respect to any Distribution Date, a Trigger
Event exists if (i) the quotient (expressed as a percentage) of (1)
the rolling
three month average of the aggregate unpaid principal balance of
60+ Day
Delinquent Mortgage Loans, divided by (2) the aggregate unpaid
principal balance
of the Mortgage Loans as of the last day of the related Due Period,
equals or
exceeds 33.00% of the Senior Enhancement Percentage as of the last
day of the
prior Due Period or (ii) the quotient (expressed as a percentage)
of (x) the
aggregate amount of Realized Losses incurred since the Cut-off Date
through the
last day of the related Prepayment Period divided by (y) the
Cut-off Date Pool
Principal Balance, exceeds the applicable percentages set forth
below with
respect to such Distribution Date:
Distribution Date Occurring In
Loss Percentage
--------------------------------------------------------------------------------
January 2008 through December 2008 1.40%
for the first month, plus an
additional 1/12th
of 1.70% for each
month
thereafter
January 2009 through December 2009 3.10%
for the first month, plus an
additional 1/12th
of 1.70% for each
month thereafter
January 2010 through December 2010 4.80%
for the first month, plus an
additional 1/12th
of 1.40% for each
month thereafter
January 2011 through December 2011 6.20%
for the first month, plus an
additional 1/12th
of 0.70% for each
month thereafter
January 2012 and thereafter
6.90%
Trust: The express trust created hereunder in Section 2.01(c).
Trust Fund: The corpus of the trust created hereunder consisting
of
(i) the Mortgage Loans and all interest and principal received on
or with
respect thereto after the related Cut-off Date, other than such
amounts which
were due on the Mortgage Loans on or before the related Cut-off
Date; (ii) the
Collection Account, the Excess Reserve Fund Account, the
Distribution Account,
and all amounts deposited therein pursuant to the applicable
provisions of this
Agreement; (iii) property that secured a Mortgage Loan and has been
acquired by
foreclosure, deed-in-lieu of foreclosure or otherwise; (iv) the
Depositor's
rights under the Underlying Agreements; (v) the Corridor
Agreements; and (vi)
all proceeds of the conversion, voluntary or involuntary, of any of
the
foregoing.
Trust REMIC: Any of the Lower Tier REMIC, the Upper Tier REMIC,
the
Class B-1 REMIC, the Class B-2 REMIC, the Class B-3 REMIC and the
Class X REMIC.
Trustee: Deutsche Bank National Trust Company and its
successors
and, if a successor trustee is appointed hereunder, such
successor.
Trustee Fee: As to each Mortgage Loan and any Distribution Date,
an
amount equal to one month's interest at the related Trustee Fee
Rate on the
Stated Principal Balance of such Mortgage Loan as of the preceding
Distribution
Date (or as of the Closing Date in the case of the first
Distribution Date) or,
in the event of any payment of interest which accompanies a
Principal Prepayment
in Full made by the Mortgagor, interest at the Trustee Fee Rate on
the Stated
Principal Balance of such Mortgage Loan for the period covered by
such payment
of interest.
Trustee Fee Rate: With respect to each Mortgage Loan, 0.0079%
per
annum.
Underlying Agreements: Collectively, the Purchase Agreement,
without
the mortgage loan schedule exhibits, and the WMC Assignment
Agreement, copies of
each of which are attached hereto as Exhibit Q.
Underwriters' Exemption: Any exemption listed in footnote 1 of,
and
amended by, Prohibited Transaction Exemption 2002-41, 67 Fed. Reg.
54487 (2002),
or any successor exemption.
Underwriting Guidelines: The underwriting guidelines attached to
the
Purchase Agreement.
Unpaid Interest Amount: As of any Distribution Date and any Class
of
Certificates, the sum of (a) the portion of the Accrued Certificate
Interest
Distribution Amount from Distribution Dates prior to the current
Distribution
Date remaining unpaid immediately prior to the current Distribution
Date and (b)
interest on the amount in clause (a) above at the applicable
Pass-Through Rate
(to the extent permitted by applicable law).
Upper Tier Regular Interest: As described in the Preliminary
Statement.
Upper Tier REMIC: As described in the Preliminary Statement.
U.S. Person: (i) A citizen or resident of the United States; (ii)
a
corporation (or entity treated as a corporation for tax purposes)
created or
organized in the United States or under the laws of the United
States or of any
State thereof, including, for this purpose, the District of
Columbia; (iii) a
partnership (or entity treated as a partnership for tax purposes)
organized in
the United States or under the laws of the United States or of any
state
thereof, including, for this purpose, the District of Columbia
(unless provided
otherwise by future Treasury regulations); (iv) an estate whose
income is
includible in gross income for United States income tax purposes
regardless of
its source; or (v) 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 U.S. Persons have authority to control all substantial
decisions of the
trust. Notwithstanding the last clause of the preceding sentence,
to the extent
provided in Treasury regulations, certain trusts in existence on
August 20,
1996, and treated as U.S. Persons prior to such date, may elect to
continue to
be U.S. Persons.
Voting Rights: The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. As of any date
of
determination, (a) 1% of all Voting Rights shall be allocated to
the Class P
Certificates, if any (such Voting Rights to be allocated among the
holders of
Certificates of each such Class in accordance with their respective
Percentage
Interests), (b) 1% of all Voting Rights shall be allocated to the
Class X
Certificates, if any, and (c) the remaining Voting Rights shall be
allocated
among Holders of the remaining Classes of Certificates in
proportion to the
Certificate Balances of their respective Certificates on such
date.
WAC Cap: With respect to the Mortgage Loans as of any
Distribution
Date, the product of (i) the weighted average of the Adjusted Net
Mortgage
Interest Rates then in effect on the beginning of the related Due
Period on the
Mortgage Loans, and (ii) a fraction, the numerator of which is 30
and the
denominator of which is the actual number of days in the Interest
Accrual Period
related to such Distribution Date.
WMC: WMC Mortgage Corp., a California corporation, and its
successors in interest.
WMC Assignment Agreement: The Assignment, Assumption and
Recognition
Agreement, dated as of December 28, 2005, among the Purchaser, the
Depositor and
WMC.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
Section 2.01 Conveyance of Mortgage Loans. (a) The Depositor,
concurrently with the execution and delivery hereof, hereby sells,
transfers,
assigns, sets over and otherwise conveys to the Trustee for the
benefit of the
Certificateholders, without recourse, all the right, title and
interest of the
Depositor in and to the Trust Fund and the Trustee, on behalf of
the Trust,
hereby accepts the Trust Fund.
(b) In connection with the transfer and assignment of each
Mortgage
Loan, the Depositor has delivered or caused to be delivered to the
Custodian for
the benefit of the Certificateholders the following documents or
instruments
with respect to each Mortgage Loan so assigned:
(i) the original Mortgage Note (with all applicable riders)
bearing
all
intervening endorsements, endorsed "Pay to the order of
_________,
without
recourse" and signed in the name of the last endorsee. To the
extent
that there is no room on the face of the Mortgage Notes for
endorsements, the endorsement may be contained on an allonge unless
the
Custodian
is advised by the Depositor or the Purchaser that state law
does
not so
allow. If the Mortgage Loan was acquired by the Purchaser in a
merger,
the endorsement must be by "[last endorsee], successor by
merger
to [name
of predecessor]". If the Mortgage Loan was acquired or
originated
by the
last endorsee while doing business under another name, the
endorsement must be by "[last endorsee], formerly known as
[previous
name]";
(ii) the original of any guarantee executed in connection with
the
Mortgage
Note;
(iii) the original Mortgage (with all applicable riders) with
evidence
of recording thereon or a certified true copy of such Mortgage
submitted
for recording. If in connection with any Mortgage Loan, the
Depositor
cannot deliver or cause to be delivered the original Mortgage
with
evidence of recording thereon on or prior to the Closing Date
because
of a delay
caused by the public recording office where such Mortgage has
been
delivered for recordation or because such Mortgage has been lost
or
because
such public recording office retains the original recorded
Mortgage,
the Depositor shall deliver or cause to be delivered to the
Custodian,
a photocopy of such Mortgage, together with (A) in the case of
a delay
caused by the public recording office, an Officer's Certificate
of
WMC (or
certified by the title company, escrow agent, or closing
attorney)
stating
that such Mortgage has been dispatched to the appropriate
public
recording
office for recordation and that the original recorded Mortgage
or a copy
of such Mortgage certified by such public recording office to
be
a true and
complete copy of the original recorded Mortgage will be
promptly
delivered to the Custodian upon receipt thereof by WMC; or (B)
in
the case
of a Mortgage where a public recording office retains the
original
recorded Mortgage or in the case where a Mortgage is lost after
recordation in a public recording office, a copy of such
Mortgage
certified
by such public recording office to be a true and complete copy
of the
original recorded Mortgage;
(iv) the originals of all assumption, modification, consolidation
or
extension
agreements, if any, with evidence of recording thereon or a
certified
true copy of such agreement submitted for recording;
(v) the original Assignment of Mortgage for each Mortgage Loan
endorsed
in blank and in recordable form;
(vi) the originals of all intervening assignments of mortgage
(if
any)
evidencing a complete chain of assignment from the originator to
the
last
endorsee with evidence of recording thereon, or if any such
intervening assignment has not been returned from the applicable
recording
office or
has been lost or if such public recording office retains the
original
recorded assignments of mortgage, the Depositor shall deliver
or
cause to
be delivered to the Custodian, a photocopy of such intervening
assignment, together with (A) in the case of a delay caused by the
public
recording
office, an Officer's Certificate of the Purchaser or WMC (or
certified
by the title company, escrow agent, or closing attorney)
stating
that such
intervening assignment of mortgage has been dispatched to the
appropriate public recording office for recordation and that such
original
recorded
intervening assignment of mortgage or a copy of such
intervening
assignment
of mortgage certified by the appropriate public recording
office to
be a true and complete copy of the original recorded
intervening
assignment
of mortgage will be promptly delivered to the Custodian upon
receipt
thereof by the Purchaser or WMC, as applicable; or (B) in the
case
of an
intervening assignment where a public recording office retains
the
original
recorded intervening assignment or in the case where an
intervening assignment is lost after recordation in a public
recording
office, a
copy of such intervening assignment certified by such public
recording
office to be a true and complete copy of the original recorded
intervening assignment;
(vii) the original or duplicate original or certified copy of
lender's
title policy and all riders thereto or, any one of an original
title
binder, an original preliminary title report or an original
title
commitment, or a copy thereof certified by the title company;
and
(viii) a security agreement, chattel mortgage or equivalent
document
executed
in connection with the Mortgage (if provided).
The Depositor shall use reasonable efforts to assist the
Custodian,
the Trustee and the Servicer in enforcing the obligations of WMC
and the
Purchaser under the Underlying Agreements.
Each Mortgage Loan for which a Mortgage Note is missing shall
be
evidenced by a lost note affidavit as of the Closing Date. In the
event, for
purposes of the Closing Date, one or more lost note affidavits are
provided to
cover multiple missing Mortgage Notes, the Depositor shall use
reasonable
efforts to cause WMC or the Purchaser to deliver to the Custodian
the applicable
individual lost note affidavits within ten (10) Business Days of
the Closing
Date. If WMC and the Purchaser fail to deliver the required
individual lost note
affidavits within the specified period of time, the Trustee shall
notify the
Depositor to cause WMC or the Purchaser, as applicable, to take
such remedial
actions, including, without limitation, the repurchase by such
Person of such
Mortgage Loan within 60 days of the Closing Date.
The Depositor shall use reasonable efforts to cause WMC or the
Purchaser, as the case may be, to deliver to the Custodian, the
applicable
recorded document promptly upon receipt from the respective
recording office but
in no event later than 120 days from the Closing Date.
If any Mortgage has been recorded in the name of Mortgage
Electronic
Registration System, Inc. ("MERS") or its designee, no Assignment
of Mortgage in
favor of the Trustee will be required to be prepared or delivered
and instead,
the Servicer shall take all reasonable actions as are necessary at
the expense
of the Depositor to cause the Trust to be shown as the owner of the
related
Mortgage Loan on the records of MERS for the purpose of the system
of recording
transfers of beneficial ownership of mortgages maintained by
MERS.
The Depositor shall use reasonable efforts to cause WMC or the
Purchaser to forward, with respect to the Mortgage Loans, to the
Custodian
additional original documents, and additional documents evidencing
an
assumption, modification, consolidation or extension of a Mortgage
Loan approved
by WMC, in accordance with the terms of the Underlying Agreements.
All such
mortgage documents held by the Custodian as to each Mortgage Loan
shall
constitute the "Custodial File."
On or prior to the Closing Date, the Depositor shall use
reasonable
efforts to cause the Purchaser to deliver to the Custodian
Assignments of
Mortgages, in blank, for each Mortgage Loan (except with respect to
each MERS
Designated Mortgage Loan). The Depositor shall use reasonable
efforts to cause
the Purchaser to cause the Assignments of Mortgage with completed
recording
information to be provided to the Servicer in a reasonably
acceptable manner. No
later than thirty (30) Business Days following the later of the
Closing Date and
the date of receipt by the Servicer of the fully completed
Assignments of
Mortgages in recordable form, the Servicer shall promptly submit or
cause to be
submitted for recording, at the expense of the Purchaser or the
Depositor, at no
expense to the Trust Fund, the Servicer or the Custodian in the
appropriate
public office for real property records, each Assignment of
Mortgage referred to
in Section 2.01(b)(v). Notwithstanding the foregoing, however,
for
administrative convenience and facilitation of servicing and to
reduce closing
costs, the Assignments of Mortgage shall not be required to be
completed and
submitted for recording with respect to any Mortgage Loan (i) if
the Trustee and
each Rating Agency has received an opinion of counsel (which
opinion shall not
be an expense of the Trustee, the Servicer or the Trust Fund),
satisfactory in
form and substance to the Trustee and each Rating Agency, to the
effect that the
recordation of such Assignments of Mortgage in any specific
jurisdiction is not
necessary to protect the Trustee's interest in the related Mortgage
Note or (ii)
if such Mortgage Loan is a MERS Designated Mortgage Loan. If the
Assignment of
Mortgage is to be recorded, the Depositor shall use reasonable
efforts to cause
the Purchaser to assign the Mortgage at the Purchaser's expense to
"Deutsche
Bank National Trust Company as trustee under the Pooling and
Servicing Agreement
dated as of December 1, 2005, GSAMP Trust 2005-WMC3." In the event
that any such
assignment is lost or returned unrecorded because of a defect
therein with
respect to any Mortgage Loan, and such defect is not cured, the
Trustee shall
cause the Depositor to cause the Purchaser to repurchase, and the
Depositor
shall use reasonable efforts to cause the Purchaser to repurchase,
such Mortgage
Loan pursuant to the WMC Assignment Agreement.
On or prior to the Closing Date, the Depositor shall deliver to
the
Custodian a copy of the Data Tape Information in electronic,
machine readable
medium in a form mutually acceptable to the Depositor, the
Custodian and the
Trustee. Within ten (10) Business Days of the Closing Date, the
Depositor shall
deliver a copy of the complete Mortgage Loan Schedule to the
Custodian, the
Trustee and the Servicer, and the Custodian shall, promptly upon
receipt of the
Mortgage Loan Schedule (or any other mortgage loan schedules
received by the
Custodian from the Depositor), inform the Depositor of receipt
thereof.
In the event that such original or copy of any document
submitted
for recordation to the appropriate public recording office is not
so delivered
to the Custodian within 90 days following the Closing Date, and in
the event
that the Purchaser or WMC, as applicable, does not cure such
failure within 60
days of discovery or receipt of written notification of such
failure from the
Depositor, the related Mortgage Loan shall, upon the request of the
Depositor,
be repurchased by the Purchaser or WMC, as applicable, pursuant to
the
Underlying Agreements, at the price and in the manner specified in
the Purchase
Agreement (with respect to WMC) or this Agreement (with respect to
the
Purchaser). The foregoing repurchase obligation shall not apply in
the event
that the Purchaser or WMC, as applicable, cannot deliver such
original or copy
of any document submitted for recordation to the appropriate public
recording
office within the specified period due to a delay caused by the
recording office
in the applicable jurisdiction; provided, that the Depositor shall
cause the
Purchaser or WMC, as applicable, to instead deliver a recording
receipt of such
recording office or, if such recording receipt is not available, an
officer's
certificate of an officer of the Purchaser or WMC, as applicable,
confirming
that such document has been accepted for recording.
Notwithstanding anything to the contrary contained in this
Section
2.01, in those instances where the public recording office retains
or loses the
original Mortgage or assignment after it has been recorded, the
obligations of
the Depositor shall be deemed to have been satisfied upon delivery
to the
Custodian prior to the Closing Date of a copy of such Mortgage or
assignment, as
the case may be, certified (such certification to be an original
thereof) by the
public recording office to be a true and complete copy of the
recorded original
thereof.
(c) 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 (the "Trust") to be known, for convenience, as "GSAMP Trust
2005-WMC3" and
Deutsche Bank National Trust Company is hereby appointed as Trustee
in
accordance with the provisions of this Agreement. The parties
hereto acknowledge
and agree that it is the policy and intention of the Trust to
acquire only
Mortgage Loans meeting the requirements set forth in this
Agreement.
(d) The Trust shall have the capacity, power and authority, and
the
Trustee on behalf of the Trust is hereby authorized, to accept the
sale,
transfer, assignment, set over and conveyance by the Depositor to
the Trust of
all the right, title and interest of the Depositor in and to the
Trust Fund
(including, without limitation, the Mortgage Loans and the
Underlying
Agreements) pursuant to Section 2.01(a).
Section 2.02 Acceptance by the Trustee of the Mortgage Loans.
The
Trustee, on behalf of the Trust, hereby accepts the Trust Fund and
assumes the
obligations of the Depositor under the Underlying Agreements from
and after the
Closing Date and solely insofar as they relate to the Mortgage
Loans. For
avoidance of doubt, the parties acknowledge that all obligations so
assumed are
obligations of the Trust and, to the extent such obligations are
payment or
monetary obligations, are payable solely from the Trust Fund, and
not of the
Trustee in its individual capacity. The Custodian acknowledges
receipt of the
documents identified in the Initial Certification in the form
annexed hereto as
Exhibit E, and the Trustee declares that the Custodian, on the
Trustee's behalf,
holds and will hold such documents and the other documents
delivered to the
Custodian pursuant to Section 2.01, and that the Trustee holds or
will hold such
other assets as are included in the Trust Fund, in trust for the
exclusive use
and benefit of all present and future Certificateholders. The
Custodian
acknowledges that it will maintain possession of the related
Mortgage Notes in
the States of Utah and California, unless otherwise permitted by
the Rating
Agencies.
Prior to and as a condition to the Closing, the Custodian shall
deliver via facsimile (with original to follow the next Business
Day) to the
Depositor, Litton and the Trustee an Initial Certification prior to
the Closing
Date, or as the Depositor agrees to, on the Closing Date,
certifying receipt of
a Mortgage Note and Assignment of Mortgage for each Mortgage Loan
with any
exceptions thereon. The Custodian shall not be responsible to
verify the
validity, sufficiency or genuineness of any document in any
Custodial File.
On the Closing Date, the Custodian shall ascertain that all
documents required to be reviewed by it are in its possession, and
shall deliver
to the Depositor, Litton and the Trustee an Initial Certification,
in the form
annexed hereto as Exhibit E, and shall deliver to the Depositor,
Litton and the
Trustee a Document Certification and Exception Report, in the form
annexed
hereto as Exhibit F, within 90 days after the Closing Date to the
effect that,
as to each Mortgage Loan listed in the Mortgage Loan Schedule
(other than any
Mortgage Loan paid in full or any Mortgage Loan specifically
identified in such
certification as an exception and not covered by such
certification): (i) all
documents required to be reviewed by it are in its possession; (ii)
such
documents have been reviewed by it and appear regular on their face
and relate
to such Mortgage Loan; (iii) based on its examination and only as
to the
foregoing documents, the information set forth in items (1), (2)
and (13) of the
Mortgage Loan Schedule and items (1), (2) and (13) of the Data Tape
Information
respecting such Mortgage Loan is correct; and (iv) each Mortgage
Note has been
endorsed as provided in Section 2.01 of this Agreement. The
Custodian shall not
be responsible to verify the validity, sufficiency or genuineness
of any
document in any Custodial File.
The Custodian shall retain possession and custody of each
Custodial
File in accordance with and subject to the terms and conditions set
forth
herein. The Servicer shall promptly deliver to the Custodian, upon
the execution
or receipt thereof, the originals of such other documents or
instruments
constituting the Custodial File as come into the possession of the
Servicer from
time to time.
The Depositor shall use reasonable efforts to cause WMC and the
Purchaser to deliver to the Servicer copies of all trailing
documents required
to be included in the Custodial File at the same time the original
or certified
copies thereof are delivered to the Custodian, including but not
limited to such
documents as the title insurance policy and any other Mortgage Loan
Documents
upon return from the public recording office. The Depositor shall
use reasonable
efforts to cause the Purchaser or WMC, as applicable, to deliver,
at such
Person's expense, to the Servicer and in no event shall the
Servicer be
responsible for any expenses relating to such delivery
obligation.
Section 2.03 Representations, Warranties and Covenants of the
Servicer and the Custodian. (a) Litton hereby makes the
representations and
warranties set forth in Schedule II hereto to the Depositor and the
Trustee as
of the Closing Date. The Custodian hereby makes the representations
and
warranties set forth in Schedule III hereto to the Depositor, the
Servicer and
the Trustee as of the Closing Date.
(b) It is understood and agreed by the Servicer and the
Custodian
that the representations and warranties set forth in this Section
2.03 shall
survive the transfer of the Mortgage Loans by the Depositor to the
Trustee, and
shall inure to the benefit of the Depositor and the Trustee
notwithstanding any
restrictive or qualified endorsement on any Mortgage Note or
Assignment of
Mortgage or the examination or failure to examine any Mortgage
File. Upon
discovery by any of the Depositor, the Trustee, the Custodian or
the Servicer of
a breach of any of the foregoing representations and warranties,
the party
discovering such breach shall give prompt written notice to the
others.
(c) In connection with any repurchase or substitution of a
Mortgage
Loan pursuant to the Underlying Agreements, the Servicer shall,
based on
information provided by the Purchaser or WMC, as applicable, amend
the Mortgage
Loan Schedule for the benefit of the Certificateholders to reflect
the removal
of such Deleted Mortgage Loan and the substitution of the
Substitute Mortgage
Loan or Loans and the Servicer shall deliver the amended Mortgage
Loan Schedule
to the Custodian. The Servicer shall have no liability with respect
to the
information provided by the Purchaser or WMC, as applicable,
related to the
Substitute Mortgage Loan. Upon such substitution, the Substitute
Mortgage Loan
or Loans shall be subject to the terms of this Agreement in all
respects, and
the Purchaser or WMC, as applicable, pursuant to the WMC Assignment
Agreement
shall be deemed to have made with respect to such Substitute
Mortgage Loan or
Loans, as of the date of substitution, the representations and
warranties made
pursuant to the WMC Assignment Agreement with respect to such
Mortgage Loan.
Upon any such substitution and the deposit to the Collection
Account of the
amount required to be deposited therein in connection with such
substitution as
described in the following paragraph, the Custodian shall release
the Mortgage
File held for the benefit of the Certificateholders relating to
such Deleted
Mortgage Loan to the Purchaser or WMC, as applicable, and the
Trustee shall
execute and deliver at such Person's direction such instruments of
transfer or
assignment prepared by such Person, in each case without recourse,
as shall be
necessary to vest title in such Person, or its designee, the
Trustee's interest
in any Deleted Mortgage Loan repurchased or substituted for as
described above
in this Section 2.03.
(d) For any month in which the Purchaser or WMC substitutes one
or
more Substitute Mortgage Loans for one or more Deleted Mortgage
Loans, the
Servicer will determine the amount (if any) by which the aggregate
unpaid
principal balance of all such Substitute Mortgage Loans as of the
date of
substitution is less than the aggregate Stated Principal Balance of
all such
Deleted Mortgage Loans (after application of the scheduled
principal portion of
the Scheduled Payments due in the Due Period of substitution). The
Depositor
shall use reasonable efforts to cause the Purchaser to remit, with
respect to
any Mortgage Loans for which the Purchaser is making a
substitution, or shall
use reasonable efforts to cause WMC to remit, with respect to any
Mortgage Loans
for which WMC is making a substitution, to the Servicer for deposit
into the
related Collection Account on or before the next Remittance Date
any
Substitution Adjustment Amount.
(e) In the event that a Mortgage Loan shall have been
repurchased
pursuant to the Underlying Agreements, the Repurchase Price thereof
shall be
deposited in the Collection Account by the Servicer pursuant to
Section 3.10 on
or before the next Remittance Date and upon such deposit of the
Repurchase Price
and receipt of a Request for Release in the form of Exhibit K
hereto, the
Custodian shall release the related Custodial File held for the
benefit of the
Certificateholders to such Person as directed by the Servicer, and
the Trustee
shall execute and deliver at such Person's direction such
instruments of
transfer or assignment prepared by such Person, in each case
without recourse,
as shall be necessary to transfer title from the Trustee. It is
understood and
agreed that the obligation under this Agreement of any Person to
cure,
repurchase or replace any Mortgage Loan as to which a breach has
occurred and is
continuing, together with satisfaction of any related
indemnification
obligations, shall constitute the sole remedy against such Persons
respecting
such breach available to Certificateholders, the Depositor, the
Servicer, the
Custodian or the Trustee on their behalf.
The representations and warranties made pursuant to this
Section
2.03 shall survive delivery of the respective Custodial Files to
the Custodian
for the benefit of the Certificateholders.
Section 2.04 Non-Qualified Mortgages. Upon discovery by the
Depositor, the Servicer, the Custodian 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
promptly (and in
any event within five (5) Business Days of discovery) give written
notice
thereof to the other parties. In connection therewith, the Trustee
shall require
the Depositor to cause WMC to repurchase, and the Depositor shall
use reasonable
efforts to cause WMC to repurchase, the affected Mortgage Loan
within 30 days of
the earlier of discovery or receipt of notice in the same manner as
it would a
Mortgage Loan for a breach of representation or warranty made
pursuant to
Section 2.03. The Trustee shall reconvey to WMC 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
contained in Section 2.03.
Section 2.05 Execution and Delivery of Certificates. The
Trustee
acknowledges the transfer and assignment to it of the Trust Fund
and,
concurrently with such transfer and assignment, has executed and
delivered to or
upon the order of the Depositor, the Certificates in authorized
Denominations
evidencing directly or indirectly the entire ownership of the Trust
Fund. The
Trustee agrees to hold the Trust Fund and exercise the rights
referred to above
for the benefit of all present and future Holders of the
Certificates.
Section 2.06 REMIC Matters. The Preliminary Statement sets forth
the
designations for federal income tax purposes of all interests
created hereby.
The "Start-up Day" for purposes of the REMIC Provisions shall be
the Closing
Date. The "latest possible maturity date" is the Distribution Date
in December
2035, which is the Distribution Date following the latest Mortgage
Loan maturity
date.
Amounts payable to the Class B-1 Certificates (other than any
Basis
Risk Carry Forward Amounts) shall be deemed paid from the Upper
Tier REMIC in
respect of the Class B-1 Interest to the Class B-1 REMIC as holder
of the Class
B-1 Interest. Amounts payable to the Class B-2 Certificates (other
than any
Basis Risk Carry Forward Amounts) shall be deemed paid from the
Upper Tier REMIC
in respect of the Class B-2 Interest to the Class B-2 REMIC as
holder of the
Class B-2 Interest. Amounts payable to the Class B-3 Certificates
(other than
any Basis Risk Carry Forward Amounts) shall be deemed paid from the
Upper Tier
REMIC in respect of the Class B-3 Interest to the Class B-3 REMIC
as holder of
the Class B-3 Interest. Amounts paid to the Class X Certificates
(prior to any
reduction for any Basis Risk Payment) shall be deemed paid (i)
first, from the
Upper Tier REMIC in respect of the Class UT-X Interest to the Class
X REMIC as
holder of the Class UT-X Interest and (ii) then from the Class X
REMIC in
respect of the Class X Regular Interest to the holders of the Class
X
Certificates.
Section 2.07 Representations and Warranties of the Depositor.
The
Depositor hereby represents, warrants and covenants to the Trustee
and Litton
that as of the date of this Agreement or as of such date
specifically provided
herein:
(a) The Depositor is a corporation duly organized, validly
existing
and in good standing under the laws of the State of Delaware;
(b) The Depositor has the corporate power and authority to
convey
the Mortgage Loans and to execute, deliver and perform, and to
enter into and
consummate the transactions contemplated by, this Agreement;
(c) This Agreement has been duly and validly authorized,
executed
and delivered by the Depositor, all requisite corporate action
having been
taken, and, assuming the due authorization, execution and delivery
hereof by the
other parties hereto, constitutes or will constitute the legal,
valid and
binding agreement of the Depositor, enforceable against the
Depositor in
accordance with its terms, except as such enforcement may be
limited by
bankruptcy, insolvency, reorganization, moratorium or other similar
laws
relating to or affecting the rights of creditors generally, and by
general
equity principles (regardless of whether such enforcement is
considered in a
proceeding in equity or at law);
(d) No consent, approval, authorization or order of or
registration
or filing with, or notice to, any governmental authority or court
is required
for the execution, delivery and performance of or compliance by the
Depositor
with this Agreement or the consummation by the Depositor of any of
the
transactions contemplated hereby, except as have been made on or
prior to the
Closing Date;
(e) None of the execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby or thereby, or
the
fulfillment of or compliance with the terms and conditions of this
Agreement,
(i) conflicts or will conflict with or results or will result in a
breach of, or
constitutes or will constitute a default or results or will result
in an
acceleration under (A) the charter or bylaws of the Depositor, or
(B) of any
term, condition or provision of any material indenture, deed of
trust, contract
or other agreement or instrument to which the Depositor or any of
its
subsidiaries is a party or by which it or any of its subsidiaries
is bound; (ii)
results or will result in a violation of any law, rule, regulation,
order,
judgment or decree applicable to the Depositor of any court or
governmental
authority having jurisdiction over the Depositor or its
subsidiaries; or (iii)
results in the creation or imposition of any lien, charge or
encumbrance which
would have a material adverse effect upon the Mortgage Loans or any
documents or
instruments evidencing or securing the Mortgage Loans;
(f) There are no actions, suits or proceedings before or against
or
investigations of, the Depositor pending, or to the knowledge of
the Depositor,
threatened, before any court, administrative agency or other
tribunal, and no
notice of any such action, which, in the Depositor's reasonable
judgment, might
materially and adversely affect the performance by the Depositor of
its
obligations under this Agreement, or the validity or enforceability
of this
Agreement;
(g) The Depositor is not in default with respect to any order
or
decree of any court or any order, regulation or demand of any
federal, state,
municipal or governmental agency that may materially and adversely
affect its
performance hereunder; and
(h) Immediately prior to the transfer and assignment by the
Depositor to the Trustee on the Closing Date, the Depositor had
good title to,
and was the sole owner of each Mortgage Loan, free of any interest
of any other
Person, and the Depositor has transferred all right, title and
interest in each
Mortgage Loan to the Trustee. The transfer of each Mortgage Note
and each
Mortgage as and in the manner contemplated by this Agreement is
sufficient
either (i) fully to transfer to the Trustee, for the benefit of
the
Certificateholders, all right, title, and interest of the Depositor
thereto as
note holder and mortgagee or (ii) to grant to the Trustee, for the
benefit of
the Certificateholders, the security interest referred to in
Section 10.04.
It is understood and agreed that the representations, warranties
and
covenants set forth in this Section 2.07 shall survive delivery of
the
respective Custodial Files to the Custodian or to a custodian, as
the case may
be, and shall inure to the benefit of the Trustee.
Section 2.08 Enforcement of Obligations for Breach of Mortgage
Loan
Representations. Upon discovery by any of the parties hereto of a
breach of a
representation or warranty made by the Purchaser or WMC pursuant to
the
Underlying Agreements, the party discovering such breach shall give
prompt
written notice thereof to the other parties to this Agreement, WMC
and/or the
Purchaser, as applicable. The Trustee shall take such action with
respect to
such breach under the Underlying Agreements as may be necessary or
appropriate
to enforce the rights of the Trust with respect thereto.
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01 Servicer to Service Mortgage Loans. (a) For and on
behalf of the Certificateholders, the Servicer shall service and
administer the
Mortgage Loans in accordance with the terms of this Agreement and
the respective
Mortgage Loans and, to the extent consistent with such terms, in
compliance with
all applicable federal, state and local laws, and 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
mortgage
lenders and loan servicers administering similar mortgage loans but
without
regard to:
(i) any relationship that the Servicer, any Subservicer or any
Affiliate
of the Servicer or any Subservicer may have with the related
Mortgagor;
(ii) the ownership or non-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 or any Subservicer's right to receive
compensation for its services hereunder or with respect to any
particular
transaction.
To the extent consistent with the foregoing, the Servicer shall
seek
to maximize the timely and complete recovery of principal and
interest on the
Mortgage Notes. Subject only to the above-described servicing
standards and the
terms of this Agreement and of the respective Mortgage Loans, the
Servicer shall
have full power and authority, acting alone or through Subservicers
as provided
in Section 3.02, 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.
Without limiting the generality of the foregoing, the Servicer in
its own name,
in the name of a Subservicer or in the name of the Trustee solely
in its
capacity as Trustee for the Trust, is hereby authorized and
empowered when the
Servicer believes it appropriate in its best judgment in accordance
with the
servicing standards set forth above, to execute and deliver any and
all
instruments of satisfaction or cancellation, or of partial or full
release or
discharge, and all other comparable instruments, with respect to
the Mortgage
Loans and the 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 and in the name of the Trust. The Servicer shall
service and
administer the 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 3.16, the
Custodian and the
Trustee shall execute, at the written request of the Servicer, and
furnish to
the Servicer and any Subservicer such documents as are necessary or
appropriate
to enable the Servicer or any Subservicer to carry out their
servicing and
administrative duties hereunder, and the Custodian and the Trustee
hereby grant
to the Servicer, and this Agreement shall constitute, a power of
attorney to
carry out such duties including a power of attorney to take title
to Mortgaged
Properties after foreclosure on behalf of the Trustee and in the
name of the
Trust. The Trustee shall execute a separate power of attorney in
the form
attached hereto as Exhibit P in favor of the Servicer for the
purposes described
herein to the extent necessary or desirable to enable the Servicer
to perform
its duties hereunder. The Trustee shall not be liable for the
actions of the
Servicer or any Subservicers or the use of such powers of
attorney.
(b) Subject to Section 3.09(b), in accordance with Accepted
Servicing Practices, the Servicer shall advance or cause to be
advanced funds as
necessary for the purpose of effecting the timely payment of taxes
and
assessments on the Mortgaged Properties, which advances shall be
Servicing
Advances reimbursable in the first instance from related
collections from the
Mortgagors pursuant to Section 3.09(b), and further as provided in
Section 3.11.
Any cost incurred by the Servicer or by Subservicers in effecting
the timely
payment of taxes and assessments on a Mortgaged Property shall not
be added to
the unpaid principal balance of the related Mortgage Loan,
notwithstanding that
the terms of such Mortgage Loan so permit.
(c) Notwithstanding anything in this Agreement to the contrary,
the
Servicer may not make any future advances with respect to a
Mortgage Loan
(except as provided in Section 4.01) and the Servicer shall not (i)
permit any
modification with respect to any Mortgage Loan that would change
the Mortgage
Interest Rate, reduce or increase the principal balance (except for
reductions
resulting from actual payments of principal) or change the final
maturity date
on such Mortgage Loan (except for (A) a reduction of interest or
principal
payments resulting from the application of the Servicemembers Civil
Relief Act
or any similar state or local statutes or (B) as provided in
Section 3.07(a), if
the Mortgagor is in default with respect to the Mortgage Loan or
such default
is, in the judgment of the Servicer, reasonably foreseeable) or
(ii) permit any
modification, waiver or amendment of any term of any 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 to fail to
qualify as a
REMIC under the Code or the imposition of any tax on "prohibited
transactions"
or "contributions after the start-up day" under the REMIC
Provisions, or (iii)
except as provided in Section 3.07(a), waive any Prepayment
Premiums.
(d) The Servicer may delegate its responsibilities under this
Agreement; provided, however, that no such delegation shall release
the Servicer
from the responsibilities or liabilities arising under this
Agreement.
Section 3.02 Subservicing Agreements between the Servicer and
Subservicers.
(a) The Servicer may enter into subservicing agreements with
subservicers (each, a "Subservicer"), for the servicing and
administration of
the Mortgage Loans ("Subservicing Agreements").
(b) Each Subservicer shall be (i) authorized to transact business
in
the state or states in which the related Mortgaged Properties it is
to service
are situated, if and to the extent required by applicable law to
enable the
Subservicer to perform its obligations hereunder and under the
Subservicing
Agreement, (ii) an institution approved as a mortgage loan
originator by the
Federal Housing Administration or an institution that has deposit
accounts
insured by the FDIC and (iii) a Freddie Mac or Fannie Mae approved
mortgage
servicer. Each Subservicing Agreement must impose on the
Subservicer
requirements conforming to the provisions set forth in Section 3.08
and provide
for servicing of the Mortgage Loans consistent with the terms of
this Agreement.
The Servicer will examine each Subservicing Agreement and will be
familiar with
the terms thereof. The terms of any Subservicing Agreement will not
be
inconsistent with any of the provisions of this Agreement. The
Servicer and the
respective Subservicers may enter into and make amendments to the
Subservicing
Agreements or enter into different forms of Subservicing
Agreements; provided,
however, that any such amendments or different forms shall be
consistent with
and not violate the provisions of this Agreement, and that no such
amendment or
different form shall be made or entered into which could be
reasonably expected
to be materially adverse to the interests of the Trustee, without
the consent of
the Trustee. Any variation without the consent of the Trustee from
the
provisions set forth in Section 3.08 relating to insurance or
priority
requirements of Subservicing Accounts, or credits and charges to
the
Subservicing Accounts or the timing and amount of remittances by
the
Subservicers to the Servicer, are conclusively deemed to be
inconsistent with
this Agreement and therefore prohibited. The Servicer shall deliver
to the
Trustee and the Depositor copies of all Subservicing Agreements,
and any
amendments or modifications thereof, promptly upon the Servicer's
execution and
delivery of such instruments.
(c) As part of its servicing activities hereunder, the Servicer
(except as otherwise provided in the last sentence of this
paragraph), for the
benefit of the Trustee, shall enforce the obligations of each
Subservicer under
the related Subservicing Agreement, including, without limitation,
any
obligation to make advances in respect of delinquent payments as
required by a
Subservicing Agreement. Such enforcement, including, without
limitation, the
legal prosecution of claims, termination of Subservicing
Agreements, and the
pursuit of other appropriate remedies, shall be in such form and
carried out to
such an extent and at such time as the Servicer, in its good faith
business
judgment, would require were it the owner of the related Mortgage
Loans. The
Servicer shall pay the costs of such enforcement at its own
expense, and shall
be reimbursed therefor only (i) from a general recovery resulting
from such
enforcement, to the extent, if any, that such recovery exceeds all
amounts due
in respect of the related Mortgage Loans or (ii) from a specific
recovery of
costs, expenses or attorneys' fees against the party against whom
such
enforcement is directed.
Section 3.03 Successor Subservicers. The Servicer shall be
entitled
to terminate any Subservicing Agreement and the rights and
obligations of any
Subservicer pursuant to any Subservicing Agreement in accordance
with the terms
and conditions of such Subservicing Agreement. In the event of
termination of
any Subservicer, all servicing obligations of such Subservicer
shall be assumed
simultaneously by the Servicer without any act or deed on the part
of such
Subservicer or the Servicer, and the Servicer either shall service
directly the
related Mortgage Loans or shall enter into a Subservicing Agreement
with a
successor Subservicer which qualifies under Section 3.02.
Any Subservicing Agreement shall include the provision that
such
agreement may be immediately terminated by the Depositor or the
Trustee without
fee, in accordance with the terms of this Agreement, in the event
that the
Servicer shall, for any reason, no longer be the Servicer
(including termination
due to an Event of Default).
Section 3.04 Liability of the Servicer. Notwithstanding any
Subservicing Agreement, any of the provisions of this Agreement
relating to
agreements or arrangements between the Servicer and a Subservicer
or reference
to actions taken through a Subservicer or otherwise, the Servicer
shall remain
obligated and primarily liable to the Trustee for the servicing
and
administering of the Mortgage Loans in accordance with the
provisions of Section
3.01 without diminution of such obligation or liability by virtue
of such
Subservicing Agreements or arrangements or by virtue of
indemnification from the
Subservicer and to the same extent and under the same terms and
conditions as if
the Servicer alone were servicing and administering such Mortgage
Loans. The
Servicer shall be entitled to enter into any agreement with a
Subservicer for
indemnification of the Servicer by such Subservicer and nothing
contained in
this Agreement shall be deemed to limit or modify such
indemnification.
Section 3.05 No Contractual Relationship between Subservicers
and
the Trustee. Any Subservicing Agreement that may be entered into
and any
transactions or services relating to the Mortgage Loans involving a
Subservicer
in its capacity as such shall be deemed to be between the
Subservicer and the
Servicer alone, and the Trustee (or any successor Servicer) shall
not be deemed
a party thereto and shall have no claims, rights, obligations,
duties or
liabilities with respect to the Subservicer except as set forth in
Section 3.06.
The Servicer shall be solely liable for all fees owed by it to any
Subservicer,
irrespective of whether the Servicer's compensation pursuant to
this Agreement
is sufficient to pay such fees.
Section 3.06 Assumption or Termination of Subservicing Agreements
by
Trustee. In the event the Servicer at any time shall for any reason
no longer be
the Servicer (including by reason of the occurrence of an Event of
Default), the
Trustee, or its designee, or the successor Servicer if the
successor Servicer is
not the Trustee, shall thereupon assume all of the rights and
obligations of the
Servicer under each Subservicing Agreement that the Servicer may
have entered
into, with copies thereof provided to the Trustee prior to the
Trustee assuming
such rights and obligations, unless the Trustee elects to terminate
any
Subservicing Agreement in accordance with its terms as provided in
Section 3.03.
Upon such assumption, the Trustee, its designee or the
successor
servicer shall be deemed, subject to Section 3.03, to have assumed
all of the
Servicer's interest therein and to have replaced the Servicer as a
party to each
Subservicing Agreement to the same extent as if each Subservicing
Agreement had
been assigned to the assuming party, except that (i) the Servicer
shall not
thereby be relieved of any liability or obligations under any
Subservicing
Agreement that arose before it ceased to be the Servicer and (ii)
none of the
Depositor, the Trustee, their designees or any successor Servicer
shall be
deemed to have assumed any liability or obligation of the Servicer
that arose
before it ceased to be the Servicer.
The Servicer at its expense shall, upon request of the Trustee,
deliver to the assuming party all documents and records relating to
each
Subservicing Agreement and the Mortgage Loans then being serviced
and an
accounting of amounts collected and held by or on behalf of it, and
otherwise
use its best efforts to effect the orderly and efficient transfer
of the
Subservicing Agreements to the assuming party.
Section 3.07 Collection of Certain Mortgage Loan Payments. (a)
The
Servicer shall make reasonable efforts to collect all payments
called for under
the terms and provisions of the Mortgage Loans and shall, to the
extent such
procedures shall be consistent with this Agreement and the terms
and provisions
of any applicable Insurance Policies, 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 and
Accepted Servicing
Practices, the Servicer may (i) waive any late payment charge or,
if applicable,
any penalty interest, or (ii) extend the due dates for the
Scheduled Payments
due on a Mortgage Note for a period of not greater than 180 days;
provided, that
any extension pursuant to clause (ii) above shall not affect the
amortization
schedule of any Mortgage Loan for purposes of any computation
hereunder, except
as provided below. In the event of any such arrangement pursuant to
clause (ii)
above, the Servicer shall make timely advances on such Mortgage
Loan during such
extension pursuant to Section 4.01 and in accordance with the
amortization
schedule of such Mortgage Loan without modification thereof by
reason of such
arrangements, subject to Section 4.01(d) pursuant to which the
Servicer shall
not be required to make any such advances that are Nonrecoverable
P&I Advances.
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 the standards set forth in Section 3.01,
may also
waive, modify or vary any term of such Mortgage Loan (including
modifications
that would change the Mortgage Interest Rate, forgive the payment
of principal
or interest, extend the final maturity date of such Mortgage Loan
or waive, in
whole or in part, a Prepayment Premium), 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
(any and all such waivers, modifications, variances, forgiveness of
principal or
interest, postponements, or indulgences collectively referred to
herein as
"Forbearance"); provided, however, that the final maturity date of
any Mortgage
Loan may not be extended beyond the Final Scheduled Distribution
Date for the
LIBOR Certificates. The Servicer's analysis supporting any
Forbearance and the
conclusion that any Forbearance meets the standards of Section 3.01
shall be
reflected in writing in the applicable Servicing File.
Notwithstanding the
foregoing, the Servicer may waive, in whole or in part, a
Prepayment Premium
only under the following circumstances: (i) such waiver relates to
a default or
a 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 Premium and the related Mortgage Loan, (ii) such
Prepayment
Premium is not permitted to be collected by applicable federal,
state or local
law or regulation, (iii) the collection of such Prepayment Premium
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, (iv) the
enforceability
thereof is limited (1) by bankruptcy, insolvency, moratorium,
receivership or
other similar laws relating to creditor's rights generally or (2)
due to
acceleration in connection with a foreclosure or other involuntary
payment or
(v) if the Servicer has not been provided with information
sufficient to enable
it to collect the Prepayment Premium. If a Prepayment Premium is
waived other
than as permitted in this Section 3.07(a), then the Servicer is
required to pay
the amount of such waived Prepayment Premium, for the benefit of
the Holders of
the Class P Certificates, by depositing such amount into the
Collection Account
as soon as possible after the date of payoff, but in no event later
than five
(5) Business Days from such date.
(b) The Servicer shall give notice to the Trustee, each Rating
Agency and the Depositor of any proposed change of the location of
the
Collection Account within a reasonable period of time prior to any
change
thereof.
Section 3.08 Subservicing Accounts. In those cases where a
Subservicer is servicing a Mortgage Loan pursuant to a Subservicing
Agreement,
the Subservicer will be required to establish and maintain one or
more accounts
(collectively, the "Subservicing Account"). The Subservicing
Account shall be an
Eligible Account and shall otherwise be acceptable to the Servicer.
The
Subservicer shall deposit in the clearing account (which account
must be an
Eligible 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
Subservicer's
receipt thereof, all proceeds of Mortgage Loans received by the
Subservicer less
its servicing compensation to the extent permitted by the
Subservicing
Agreement, and shall thereafter deposit such amounts in the
Subservicing
Account, in no event more than two Business Days after the deposit
of such funds
into the clearing account. The Subservicer shall thereafter deposit
such
proceeds in the Collection Account or remit such proceeds to the
Servicer for
deposit in the Collection Account not later than two Business Days
after the
deposit of such amounts in the Subservicing Account. For purposes
of this
Agreement, the Servicer shall be deemed to have received payments
on the
Mortgage Loans when the Subservicer receives such payments.
Section 3.09 Collection of Taxes, Assessments and Similar
Items;
Escrow Accounts. (a) The Servicer shall ensure that each of the
Mortgage Loans
shall be covered by a paid-in-full, life-of-the-loan tax service
contract in
effect with respect to each Mortgage Loan (each, a "Tax Service
Contract");
provided, that WMC transferred a fully transferable Tax Service
Contract to the
Servicer at no expense to the Servicer. Each Tax Service Contract
shall be
assigned to the Trustee, or its designee, at the Servicer's expense
in the event
that the Servicer is terminated as Servicer of the related Mortgage
Loan.
(b) To the extent that the services described in this paragraph
(b)
are not otherwise provided pursuant to the Tax Service Contracts
described in
paragraph (a) hereof, the Servicer undertakes to perform such
functions. To the
extent the related Mortgage Loan provides for Escrow Payments, the
Servicer
shall establish and maintain, or cause to be established and
maintained, one or
more accounts (the "Escrow Accounts"), which shall be Eligible
Accounts. The
Servicer shall deposit in the clearing account (which account must
be an
Eligible 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 collections from the Mortgagors (or related
advances from
Subservicers) for the payment of taxes, assessments, hazard
insurance premiums
and comparable items for the account of the Mortgagors ("Escrow
Payments")
collected on account of the Mortgage Loans and shall thereafter
deposit such
Escrow Payments in the Escrow Accounts, in no event more than two
Business Days
after the deposit of such funds in the clearing account, for the
purpose of
effecting the payment of any such items as required under the terms
of this
Agreement. Withdrawals of amounts from an Escrow Account may be
made only to (i)
effect payment of taxes, assessments, hazard insurance premiums,
and comparable
items; (ii) reimburse the Servicer (or a Subservicer to the extent
provided in
the related Subservicing Agreement) out of related collections for
any advances
made pursuant to Section 3.01 (with respect to taxes and
assessments) and
Section 3.13 (with respect to 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 Escrow Account;
(v) clear and
terminate the Escrow Account at the termination of the Servicer's
obligations
and responsibilities in respect of the Mortgage Loans under this
Agreement; or
(vi) recover amounts deposited in error. As part of its servicing
duties, the
Servicer or Subservicers shall pay to the Mortgagors interest on
funds in Escrow
Accounts, to the extent required by law and, to the extent that
interest earned
on funds in the Escrow Accounts is insufficient, to pay such
interest from its
or their own funds, without any reimbursement therefor. To the
extent that a
Mortgage does not provide for Escrow Payments, the Servicer 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. 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 will, 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. The
Servicer assumes
full responsibility for the payment of all such bills within such
time 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 advances from its own funds to effect such payments;
provided,
however, that such advances are deemed to be Servicing
Advances.
Section 3.10 Collection Account. (a) On behalf of the Trustee,
the
Servicer shall establish and maintain, or cause to be established
and
maintained, one or more Eligible Accounts (such account or
accounts, the
"Collection Account"), held in trust for the benefit of the
Trustee. Funds in
the Collection Account shall not be commingled with any other funds
of the
Servicer. On behalf of the Trustee, the Servicer shall deposit or
cause to be
deposited in the clearing account (which account must be an
Eligible 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
more than two
Business Days after the deposit of such funds into the clearing
account, as and
when received or as otherwise required hereunder, the following
payments and
collections received or made by it subsequent to the Cut-off Date
(other than in
respect of principal or interest on the related Mortgage Loans due
on or before
the Cut-off Date), or payments (other than Principal Prepayments)
received by it
on or prior to the Cut-off Date but allocable to a Due Period
subsequent
thereto:
(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) on each Mortgage Loan;
(iii) all Insurance Proceeds and Condemnation Proceeds (to the
extent
such Insurance Proceeds and Condemnation Proceeds are not to be
applied to
the restoration of the related Mortgaged Property or released
to the
related Mortgagor in accordance with the express requirements
of
law or in
accordance with prudent and customary servicing practices) and
all
Liquidation Proceeds;
(iv) any amounts required to be deposited pursuant to Section
3.12
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 3.13(a) in respect of any blanket policy
deductibles;
(vi) all proceeds of any Mortgage Loan repurchased or purchased
in
accordance
with this Agreement and any Substitution Adjustment Amount; and
(vii) all Prepayment Premiums collected by the Servicer.
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, NSF
fees, reconveyance fees, assumption fees and other similar fees and
charges need
not be deposited by the Servicer in the Collection Account and
shall, upon
collection, belong to the Servicer as additional compensation for
its servicing
activities. 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) Funds in the Collection Account may be invested in
Permitted
Investments in accordance with the provisions set forth in Section
3.12. The
Servicer shall give notice to the Trustee and the Depositor of the
location of
the Collection Account maintained by it when established and prior
to any change
thereof.
Section 3.11 Withdrawals from the Collection Account. (a) The
Servicer shall, from time to time, make withdrawals from the
Collection Account
for any of the following purposes or as described in Section
4.01:
(i) on or prior to the Remittance Date, to remit to the Trustee
(A)
the
Trustee Fee with respect to such Distribution Date and (B) all
Available
Funds in respect of the related Distribution Date together with
all
amounts representing Prepayment Premiums from the Mortgage
Loans
received
during the related Prepayment Period;
(ii) to reimburse the Servicer for P&I Advances, but only to
the
extent of
amounts received which represent Late Collections (net of the
related
Servicing Fees) of Scheduled Payments on Mortgage Loans with
respect to
which such P&I Advances were made in accordance with the
provisions
of Section 4.01;
(iii) to pay the Servicer or any Subservicer (A) any unpaid
Servicing
Fees or (B) any unreimbursed Servicing Advances with respect to
each
Mortgage Loan, but in each case only to the extent of any Late
Collections or other amounts as may be collected by the Servicer
from a
Mortgagor,
or otherwise received with respect to such Mortgage Loan (or
the
related REO Property);
(iv) to pay to the Servicer as servicing compensation (in
addition
to the
Servicing Fee) on the Remittance Date any interest or
investment
income
earned on funds deposited in the Collection Account;
(v) to pay to the Purchaser or WMC, with respect to each
Mortgage
Loan that
has previously been repurchased or replaced pursuant to this
Agreement
all amounts received thereon subsequent to the date of purchase
or
substitution, as the case may be;
(vi) to reimburse the Servicer for any P&I Advance or
Servicing
Advance
previously made which the Servicer has determined to be a
Nonrecoverable P&I Advance or Nonrecoverable Servicing Advance
in
accordance
with the provisions of Section 4.01;
(vii) to pay, or to reimburse the Servicer for advances in
respect
of,
expenses incurred in connection with any Mortgage Loan pursuant
to
Section
3.15;
(viii) to reimburse the Servicer, the Depositor or the Trustee
for
expenses
incurred by or reimbursable to the Servicer, the Depositor or
the
Trustee,
as the case may be, pursuant to Section 6.03 or Section 8.05;
(ix) to reimburse the Servicer or the Trustee, as the case may
be,
for
expenses reasonably incurred in respect of the breach or defect
giving
rise to the repurchase
obligation under Section 2.03 of this Agreement
that were
included in the Repurchase Price of the Mortgage Loan,
including
any
expenses arising out of the enforcement of the repurchase
obligation,
to the
extent not otherwise paid pursuant to the terms hereof;
(x) to invest funds in Permitted Investments in accordance with
Section
3.12;
(xi) to withdraw any amounts deposited in the Collection Account
in
error;
(xii) to withdraw any amounts held in the Collection Account and
not
required
to be remitted to the Trustee on the Remittance Date occurring
in
the month
in which such amounts are deposited into the Collection
Account,
to
reimburse the Servicer for unreimbursed Advances;
(xiii) to reimburse the Servicer for any P&I Advance or
Servicing
Advance
previously made with respect to a delinquent Mortgage Loan
which
Mortgage
Loan has been modified by the Servicer in accordance with the
terms of
this Agreement; provided that the Servicer shall only reimburse
itself for
such P&I Advances and Servicing Advances at the time of
such
modification and shall reimburse itself after such modification
only as
otherwise
permitted under the other clauses of this Section 3.11(a);
(xiv) to pay the Servicer or any Subservicer any unpaid
Servicing
Fees on a
Second Lien Mortgage Loan that has been charged off (A) out of
any
Liquidation Proceeds, Condemnation Proceeds or Insurance
Proceeds
received
on the related First Lien Mortgage Loan that is secured by the
same
Mortgaged Property, to the extent not recoverable from Late
Collections or any other amounts with respect to such Second Lien
Mortgage
Loan
pursuant to clause (iii) above or (B) to the extent not
recoverable
pursuant
to (A) of this clause (xiv), from any amounts on deposit in the
Collection
Account; and
(xv) to clear and terminate the Collection Account upon
termination
of this
Agreement.
(b) The Servicer shall keep and maintain separate accounting, on
a
Mortgage Loan by Mortgage Loan basis, for the purpose of justifying
any
withdrawal from the Collection Account, to the extent held by or on
behalf of
it, pursuant to subclauses (a)(ii), (iii), (iv), (v), (vi), (vii),
(viii), (ix)
and (xiii) above. The Servicer shall provide written notification
to the
Depositor, on or prior to the next succeeding Remittance Date, upon
making any
withdrawals from the Collection Account pursuant to subclause
(a)(vi) above.
Section 3.12 Investment of Funds in the Collection Account and
the
Distribution Account. (a) The Servicer may invest the funds in the
Collection
Account and the Trustee may invest funds in the Distribution
Account (for
purposes of this Section 3.12, such Accounts are referred to as an
"Investment
Account") in one or more Permitted Investments bearing interest or
sold at a
discount, and maturing, unless payable on demand no later than the
Business Day
immediately preceding the date on which such funds are required to
be withdrawn
from such account pursuant to this Agreement. All such Permitted
Investments
shall be held to maturity, unless payable on demand. Any investment
of funds in
an Investment Account shall be made in the name of the Trustee. The
Trustee
shall be entitled to sole possession over each such investment, and
any
certificate or other instrument evidencing any such investment
shall be
delivered directly to the Trustee or its agent, together with any
document of
transfer necessary to transfer title to such investment to the
Trustee. In the
event amounts on deposit in an Investment Account are at any time
invested in a
Permitted Investment payable on demand, the Trustee may:
(x) consistent
with any notice required to be given thereunder,
demand that payment thereon be made on the last day such
Permitted Investment may otherwise mature hereunder in an
amount equal to the lesser of (1) all amounts then payable
thereunder and (2) the amount required to be withdrawn on such
date; and
(y) demand
payment of all amounts due thereunder that such
Permitted Investment would not constitute a Permitted
Investment in respect of funds thereafter on deposit in the
Investment Account.
(b) All income and gain realized from the investment of funds
deposited in the Collection Account held by or on behalf of the
Servicer, shall
be for the benefit of the Servicer and shall be subject to its
withdrawal in the
manner set forth in Section 3.11. The Servicer shall deposit in the
Collection
Account the amount of any loss of principal incurred in respect of
any such
Permitted Investment made with funds in such accounts immediately
upon
realization of such loss.
(c) All income and gain realized from the investment of funds
deposited in the Distribution Account held by the Trustee shall be
for the
benefit of the Trustee. The Trustee shall deposit in the
Distribution Account
the amount of any loss of principal incurred in respect of any such
Permitted
Investment made with funds in such accounts immediately upon
realization of such
loss.
(d) Except as otherwise expressly provided in this Agreement, if
any
default occurs in the making of a payment due under any Permitted
Investment, or
if a default occurs in any other performance required under any
Permitted
Investment, the Trustee shall take such action as may be
appropriate to enforce
such payment or performance, including the institution and
prosecution of
appropriate proceedings.
(e) The Trustee or its Affiliates are permitted to receive
additional compensation that could be deemed to be in the Trustee's
economic
self-interest for (i) serving as investment adviser, administrator,
shareholder,
servicing agent, custodian or sub-custodian with respect to certain
of the
Permitted Investments, (ii) using Affiliates to effect transactions
in certain
Permitted Investments and (iii) effecting transactions in certain
Permitted
Investments.
(f) The Trustee shall not be liable for the amount of any loss
incurred with respect of any investment or lack of investment of
funds held in
any Investment Account (except with respect to investments in the
Distribution
Account as provided in Section 3.12(c)).
Section 3.13 Maintenance of Hazard Insurance, Errors and
Omissions
and Fidelity Coverage. (a) The Servicer shall cause to be
maintained for each
Mortgage Loan standard hazard insurance on the related Mortgaged
Property in an
amount which is at least equal to the least of (i) the outstanding
principal
balance of such Mortgage Loan, (ii) the amount necessary to fully
compensate for
any damage or loss to the improvements that are a part of such
property on a
replacement cost basis and (iii) the maximum insurable value of the
improvements
which are a part of such Mortgaged Property, in each case in an
amount not less
than such amount as is necessary to avoid the application of any
coinsurance
clause contained in the related hazard insurance policy. The
Servicer shall also
cause to be maintained fire insurance with extended coverage on
each REO
Property in an amount which is at least equal to the lesser of (i)
the maximum
insurable value of the improvements which are a part of such
property and (ii)
the outstanding principal balance of the related Mortgage Loan at
the time it
became an REO Property, plus accrued interest at the Mortgage
Interest Rate and
related Servicing Advances. The Servicer will comply in the
performance of this
Agreement with all reasonable rules and requirements of each
insurer under any
such hazard policies. Any amounts to be collected by the Servicer
under any such
policies (other than amounts to be applied to the restoration or
repair of the
property subject to the related Mortgage or amounts to be released
to the
Mortgagor in accordance with the procedures that the Servicer would
follow in
servicing loans held for its own account, subject to the terms and
conditions of
the related Mortgage and Mortgage Note) shall be deposited in the
Collection
Account, subject to withdrawal pursuant to Section 3.11. Any cost
incurred by
the Servicer in maintaining any such insurance shall not, for the
purpose of
calculating distributions to the Trustee, be added to the unpaid
principal
balance of the related Mortgage Loan, notwithstanding that the
terms of such
Mortgage Loan so permit. It is understood and agreed that no
earthquake or other
additional insurance is to be required of any Mortgagor other than
pursuant to
such applicable laws and regulations as shall at any time be in
force and as
shall require such additional insurance. If the Mortgaged Property
or REO
Property is at any time in an area identified in the Federal
Register by the
Federal Emergency Management Agency as having special flood hazards
and flood
insurance has been made available, the Servicer will cause to be
maintained a
flood insurance policy in respect thereof. Such flood insurance
shall be in an
amount equal to the lesser of (i) the unpaid principal balance of
the related
Mortgage Loan and (ii) the maximum amount of such insurance
available for the
related Mortgaged Property under the national flood insurance
program (assuming
that the area in which such Mortgaged Property is located is
participating in
such program).
In the event that the Servicer shall obtain and maintain a
blanket
policy with an insurer having a General Policy Rating of B:VI or
better in
Best's (or such other rating that is comparable to such rating)
insuring against
hazard losses on all of the Mortgage Loans, it shall conclusively
be deemed to
have satisfied its obligations as set forth in the first two
sentences of this
Section 3.13, it being understood and agreed that such policy may
contain a
deductible clause, in which case the Servicer shall, in the event
that there
shall not have been maintained on the related Mortgaged Property or
REO Property
a policy complying with the first two sentences of this Section
3.13, and there
shall have been one or more losses which would have been covered by
such policy,
deposit to the Collection Account from its own funds the amount not
otherwise
payable under the blanket policy because of such deductible clause.
In
connection with its activities as administrator and servicer of the
Mortgage
Loans, the Servicer agrees to prepare and present, on behalf of
itself, the
Trustee claims under any such blanket policy in a timely fashion in
accordance
with the terms of such policy.
(b) The Servicer shall keep in force during the term of this
Agreement a policy or policies of insurance covering errors and
omissions for
failure in the performance of the Servicer's obligations under this
Agreement,
which policy or policies shall be in such form and amount that
would meet the
requirements of Fannie Mae or Freddie Mac if it were the purchaser
of the
Mortgage Loans, unless the Servicer has obtained a waiver of such
requirements
from Fannie Mae or Freddie Mac. The Servicer shall also maintain a
fidelity bond
in the form and amount that would meet the requirements of Fannie
Mae or Freddie
Mac, unless the Servicer has obtained a waiver of such requirements
from Fannie
Mae or Freddie Mac. The Servicer shall provide the Trustee upon
request with
copies of any such insurance policies and fidelity bond. The
Servicer shall be
deemed to have complied with this provision if an Affiliate of the
Servicer has
such errors and omissions and fidelity bond coverage and, by the
terms of such
insurance policy or fidelity bond, the coverage afforded thereunder
extends to
the Servicer. Upon request from the Trustee, the Servicer shall
cause to be
delivered to the Trustee proof of coverage of the fidelity bond
errors and
omissions insurance policy and a statement from the surety and the
insurer that
that surety and insurer shall endeavor to notify the Trustee within
30 days
prior to such fidelity bond's errors and omissions insurance
policy's
termination or material modification. The Servicer shall also cause
each
Subservicer to maintain a policy of insurance covering errors and
omissions and
a fidelity bond which would meet such requirements.
Section 3.14 Enforcement of Due-on-Sale Clauses; Assumption
Agreements. The Servicer will, to the extent it has knowledge of
any conveyance
or prospective conveyance of any Mortgaged Property by any
Mortgagor (whether by
absolute conveyance or by contract of sale, and whether or not the
Mortgagor
remains or is to remain liable under the Mortgage Note and/or the
Mortgage),
exercise its rights to accelerate the maturity of such Mortgage
Loan under the
"due-on-sale" clause, if any, applicable thereto; provided,
however, that the
Servicer shall not be required to take such action if, in its sole
business
judgment, the Servicer believes it is not in the best interests of
the Trust
Fund and shall not exercise any such rights if prohibited by law
from doing so.
If the Servicer reasonably believes it is unable under applicable
law to enforce
such "due-on-sale" clause or if any of the other conditions set
forth in the
proviso to the preceding sentence apply, the Servicer will enter
into an
assumption and modification agreement from or with the person to
whom such
property has been conveyed or is proposed to be conveyed, pursuant
to which such
person becomes liable under the Mortgage Note, the Servicer has the
prior
consent of the primary mortgage guaranty insurer, if any, and, to
the extent
permitted by applicable state law, the Mortgagor remains liable
thereon. The
Servicer is also authorized to enter into a substitution of
liability agreement
with such person, pursuant to which the original Mortgagor is
released from
liability and such person is substituted as the Mortgagor and
becomes liable
under the Mortgage Note; provided, that no such substitution shall
be effective
unless such person satisfies the underwriting criteria of the
Servicer and has a
credit risk rating at least equal to that of the original
Mortgagor. In
connection with any assumption, modification or substitution, the
Servicer shall
apply such underwriting standards and follow such practices and
procedures as
shall be normal and usual in its general mortgage servicing
activities and as it
applies to other mortgage loans owned solely by it. The Servicer
shall not take
or enter into any assumption and modification agreement, however,
unless (to the
extent practicable in the circumstances) it shall have received
confirmation, in
writing, of the continued effectiveness of any applicable hazard
insurance
policy, or a new policy meeting the requirements of this Section is
obtained.
Any fee collected by the Servicer in respect of an assumption or
substitution of
liability agreement will be retained by the Servicer as additional
servicing
compensation. In connection with any such assumption, no material
term of the
Mortgage Note (including but not limited to the related Mortgage
Interest Rate
and the amount of the Scheduled Payment) may be amended or
modified, except as
otherwise required pursuant to the terms thereof. The Servicer
shall notify the
Custodian that any such substitution, modification or assumption
agreement has
been completed by forwarding to the Custodian the executed original
of such
substitution or assumption agreement, which document shall be added
to the
related Mortgage File and shall, for all purposes, be considered a
part of such
Mortgage File to the same extent as all other documents and
instruments
constituting a part thereof.
Notwithstanding the foregoing paragraph or any other provision
of
this Agreement, the Servicer shall not be deemed to be in default,
breach or any
other violation of its obligations hereunder by reason of any
assumption of a
Mortgage Loan by operation of law or by the terms of the Mortgage
Note or any
assumption which the Servicer may be restricted by law from
preventing, for any
reason whatsoever. For purposes of this Section 3.14, the term
"assumption" is
deemed to also include a sale (of the Mortgaged Property) subject
to the
Mortgage that is not accompanied by an assumption or substitution
of liability
agreement.
Section 3.15 Realization upon Defaulted Mortgage Loans. The
Servicer
shall use its best efforts, consistent with Accepted Servicing
Practices, to
foreclose upon or otherwise comparably convert (which may include
an acquisition
of REO Property) the ownership of properties securing such of the
Mortgage Loans
as come into and continue in default and as to which no
satisfactory
arrangements can be made for collection of delinquent payments
pursuant to
Section 3.07, and which are not released from this Agreement
pursuant to any
other provision hereof. The Servicer shall use reasonable efforts
to realize
upon such defaulted Mortgage Loans in such manner as will maximize
the receipt
of principal and interest by the Trustee, taking into account,
among other
things, the timing of foreclosure proceedings; provided, however
with respect to
any Second Lien Mortgage Loan, if, after such Mortgage Loan becomes
180 days or
more delinquent, the Servicer determines that a significant net
recovery is not
possible through foreclosure, such Mortgage Loan may be charged off
and the
Mortgage Loan will be treated as a Liquidated Mortgage Loan giving
rise to a
Realized Loss. The foregoing is subject to the provisions that, in
any case in
which a Mortgaged Property shall have suffered damage from an
uninsured cause,
the Servicer shall not be required to expend its own funds toward
the
restoration of such property unless it shall determine in its sole
discretion
(i) that such restoration will increase the net proceeds of
liquidation of the
related Mortgage Loan to the Trustee, after reimbursement to itself
for such
expenses, and (ii) that such expenses will be recoverable by the
Servicer
through Insurance Proceeds, Condemnation Proceeds or Liquidation
Proceeds from
the related Mortgaged Property, as contemplated in Section 3.11.
The Servicer
shall be responsible for all other costs and expenses incurred by
it in any such
proceedings; provided, however, that it shall be entitled to
reimbursement
thereof from the related property, as contemplated in Section 3.11.
In
circumstances where the Servicer determines that it would be
uneconomical to
foreclose on the related Mortgaged Property, the Servicer may write
off the
entire outstanding principal balance of the related Second Lien
Mortgage Loan as
bad debt.
The proceeds of any Liquidation Event or REO Disposition, as well
as
any recovery resulting from a partial collection of Insurance
Proceeds,
Condemnation Proceeds or Liquidation Proceeds or any income from an
REO
Property, will be applied in the following order of priority:
first, to
reimburse the Servicer or any Subservicer for any related
unreimbursed Servicing
Advances, pursuant to Section 3.11 or 3.17; second, to accrued and
unpaid
interest on the Mortgage Loan or REO Imputed Interest, at the
Mortgage Interest
Rate, to the date of the liquidation or REO Disposition, or to the
Due Date
prior to the Remittance Date on which such amounts are to be
distributed if not
in connection with a Liquidation Event or REO Disposition; third,
to reimburse
the Servicer for any related unreimbursed P&I Advances,
pursuant to Section
3.11; and fourth, as a recovery of principal of the Mortgage Loan.
If the amount
of the recovery so allocated to interest is less than a full
recovery thereof,
that amount will be allocated as follows: first, to unpaid
Servicing Fees; and
second, as interest at the Mortgage Interest Rate (net of the
Servicing Fee
Rate). The portion of the recovery so allocated to unpaid Servicing
Fees shall
be reimbursed to the Servicer or any Subservicer pursuant to
Section 3.11 or
3.17. The portions of the recovery so allocated to interest at the
Mortgage
Interest Rate (net of the Servicing Fee Rate) and to principal of
the Mortgage
Loan shall be applied as follows: first, to reimburse the Servicer
or any
Subservicer for any related unreimbursed Servicing Advances in
accordance with
Section 3.11 or 3.17, and second, to the Trustee in accordance with
the
provisions of Section 4.02, subject to the last paragraph of
Section 3.17 with
respect to certain excess recoveries from an REO Disposition.
Notwithstanding anything to the contrary contained herein, in
connection with a foreclosure or acceptance of a deed in lieu of
foreclosure, in
the event the Servicer has received actual notice of, or has actual
knowledge of
the presence of, hazardous or toxic substances or wastes on the
related
Mortgaged Property, or if the Trustee otherwise requests, the
Servicer shall
cause an environmental inspection or review of such Mortgaged
Property to be
conducted by a qualified inspector. Upon completion of the
inspection, the
Servicer shall promptly provide the Trustee and the Depositor with
a written
report of the environmental inspection.
After reviewing the environmental inspection report, the
Servicer
shall determine how to proceed with respect to the Mortgaged
Property. In the
event (a) the environmental inspection report indicates that the
Mortgaged
Property is contaminated by hazardous or toxic substances or wastes
and (b) the
Servicer shall proceed with foreclosure or acceptance of a deed in
lieu of
foreclosure, the Servicer shall be reimbursed for all reasonable
costs
associated with such foreclosure or acceptance of a deed in lieu of
foreclosure
and any related environmental clean-up costs, as applicable, from
the related
Liquidation Proceeds, or if the Liquidation Proceeds are
insufficient to fully
reimburse the Servicer, the Servicer shall be entitled to be
reimbursed from
amounts in the Collection Account pursuant to Section 3.11. In the
event the
Servicer does not proceed with foreclosure or acceptance of a deed
in lieu of
foreclosure, the Servicer shall be reimbursed from general
collections for all
Servicing Advances made with respect to the related Mortgaged
Property from the
Collection Account pursuant to Section 3.11. The Trustee shall not
be
responsible for any determination made by the Servicer pursuant to
this
paragraph or otherwise.
Section 3.16 Release of Mortgage Files. (a) Upon the payment in
full
of any Mortgage Loan, or the receipt by the Servicer of a
notification that
payment in full shall be escrowed in a manner customary for such
purposes, the
Servicer will, within five (5) Business Days of the payment in
full, notify the
Custodian by a certification (which certification shall include a
statement to
the effect that all amounts received or to be received in
connection with such
payment which are required to be deposited in the Collection
Account pursuant to
Section 3.10 have been or will be so deposited) of a Servicing
Officer and shall
request delivery to it of the Custodial File by completing a
Request for Release
in the form of Exhibit K hereto to the Custodian. Upon receipt of
such
certification and Request for Release, the Custodian shall promptly
release the
related Custodial File to the Servicer within three (3) Business
Days. No
expenses incurred in connection with any instrument of satisfaction
or deed of
reconveyance shall be chargeable to the Collection Account.
(b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, including, for this purpose,
collection under
any Insurance Policy relating to the Mortgage Loans, the Custodian
shall, upon
request of the Servicer and delivery to the Custodian, of a Request
for Release,
release the related Custodial File to the Servicer, and the Trustee
shall, at
the direction of the Servicer, execute such documents as shall be
necessary to
the prosecution of any such proceedings and the Servicer shall
retain the
Mortgage File in trust for the benefit of the Trustee. Such Request
for Release
shall obligate the Servicer to return each and every document
previously
requested from the Custodial File to the Custodian when the need
therefor by the
Servicer no longer exists, unless the Mortgage Loan has been
liquidated and the
Liquidation Proceeds relating to the Mortgage Loan have been
deposited in the
Collection Account or the Mortgage File or such document has been
delivered to
an attorney, or to a public trustee or other public official as
required by law,
for purposes of initiating or pursuing legal action or other
proceedings for the
foreclosure of the Mortgaged Property either judicially or
non-judicially, and
the Servicer has delivered to the Custodian a certificate of a
Servicing Officer
certifying as to the name and address of the Person to which such
Mortgage File
or such document was delivered and the purpose or purposes of such
delivery.
Upon receipt of a certificate of a Servicing Officer stating that
such Mortgage
Loan was liquidated and that all amounts received or to be received
in
connection with such liquidation that are required to be deposited
into the
related Collection Account have been so deposited, or that such
Mortgage Loan
has become an REO Property, a copy of the Request for Release shall
be released
by the Custodian to the Servicer or its designee. Upon receipt of a
Request for
Release under this Section 3.16, the Custodian shall deliver the
related
Custodial File to the requesting Servicer by regular mail, unless
the Servicer
requests that the Custodian deliver such Custodial File to the
Servicer by
overnight courier (in which case such delivery shall be at the
Servicer's
expense); provided, however, that in the event the Servicer has not
previously
received copies of the relevant Mortgage Loan Documents necessary
to service the
related Mortgage Loan in accordance with Accepted Servicing
Practices, the
Depositor shall use reasonable efforts to cause the Purchaser to
reimburse the
Servicer for any overnight courier charges incurred for the
requested Custodial
Files.
Upon written certification of a Servicing Officer, the Trustee
shall
execute and deliver to the Servicer copies of any court pleadings,
requests for
trustee's sale or other documents reasonably necessary to the
foreclosure or
trustee's sale in respect of a Mortgaged Property or to any legal
action brought
to obtain judgment against any Mortgagor on the Mortgage Note or
Mortgage or to
obtain a deficiency judgment, or to enforce any other remedies or
rights
provided by the Mortgage Note or Mortgage or otherwise available at
law or in
equity, or shall exercise and deliver to the Servicer a power of
attorney
sufficient to authorize the Servicer to execute such documents on
its behalf.
Each such certification shall include a request that such pleadings
or documents
be executed by the Trustee and a statement as to the reason such
documents or
pleadings are required and that the execution and delivery thereof
by the
Trustee will not invalidate or otherwise affect the lien of the
Mortgage, except
for the termination of such a lien upon completion of the
foreclosure or
trustee's sale.
Section 3.17 Title, Conservation and Disposition of REO
Property.
(a) This Section shall apply only to REO Properties acquired for
the account of
the Trustee and shall not apply to any REO Property relating to a
Mortgage Loan
which was purchased or repurchased from the Trustee pursuant to any
provision
hereof. In the event that title to any such REO Property is
acquired, the
Servicer shall cause the deed or certificate of sale to be issued
in the name of
the Trustee, on behalf of the Certificateholders.
(b) The Servicer shall manage, conserve, protect and operate
each
REO Property for the Trustee solely for the purpose of its prompt
disposition
and sale. The Servicer, either itself or through an agent selected
by the
Servicer, shall manage, conserve, protect and operate the REO
Property in the
same manner that it manages, conserves, protects and operates other
foreclosed
property for its own account, and in the same manner that similar
property in
the same locality as the REO Property is managed. The Servicer
shall attempt to
sell the same (and may temporarily rent the same for a period not
greater than
one year, except as otherwise provided below) on such terms and
conditions as
the Servicer deems to be in the best interest of the Trustee. The
Servicer shall
notify the Trustee from time to time as to the status of each REO
Property.
(c) The Servicer shall use its best efforts to dispose of the
REO
Property as soon as possible (subject to the Trustee's right to
veto any
proposed sale of REO Property) and shall sell such REO Property in
any event
within three years after title has been taken to such REO Property,
unless the
Servicer determines, and gives an appropriate notice to the Trustee
to such
effect, that a longer period is necessary for the orderly
liquidation of such
REO Property. If a period longer than three years is permitted
under the
foregoing sentence and is necessary to sell any REO Property, the
Servicer shall
report monthly to the Trustee as to the progress being made in
selling such REO
Property. Notwithstanding its veto rights, the Trustee has no
obligation with
respect to REO Dispositions.
(d) The Servicer shall segregate and hold all funds collected
and
received in connection with the operation of any REO Property
separate and apart
from its own funds and general assets and shall deposit such funds
in the
Collection Account.
(e) The Servicer shall deposit net of reimbursement to the
Servicer
for any related outstanding Servicing Advances and unpaid Servicing
Fees
provided in Section 3.11, or cause to be deposited, on a daily
basis in the
Collection Account all revenues received with respect to the
related REO
Property and shall withdraw therefrom funds necessary for the
proper operation,
management and maintenance of the REO Property.
(f) The Servicer, upon an REO Disposition, shall be entitled to
reimbursement for any related unreimbursed Servicing Advances as
well as any
unpaid Servicing Fees from proceeds received in connection with the
REO
Disposition, as further provided in Section 3.11.
(g) Any net proceeds from an REO Disposition which are in excess
of
the unpaid principal balance of the related Mortgage Loan plus all
unpaid REO
Imputed Interest thereon through the date of the REO Disposition
shall be
retained by the Servicer as additional servicing compensation.
(h) The Servicer shall use its reasonable best efforts to sell,
or
cause the Subservicer to sell, any REO Property as soon as
possible, but in no
event later than the conclusion of the third calendar year
beginning after the
year of its acquisition by the REMIC unless (i) the Servicer
applies for an
extension of such period from the Internal Revenue Service pursuant
to the REMIC
Provisions and Code Section 856(e)(3), in which event such REO
Property shall be
sold within the applicable extension period, or (ii) the Servicer
obtains for
the Trustee an Opinion of Counsel, addressed to the Depositor, the
Trustee and
the Servicer, to the effect that the holding by the Lower Tier
REMIC of such REO
Property subsequent to such period will not result in the
imposition of taxes on
"prohibited transactions" as defined in Section 860F of the Code or
cause any
Trust REMIC to fail to qualify as a REMIC under the REMIC
Provisions or
comparable provisions of relevant state laws at any time. The
Servicer shall
manage, conserve, protect and operate each REO Property for the
Trustee solely
for the purpose of its prompt disposition and sale in a manner
which does not
cause such REO Property to fail to qualify as "foreclosure
property" within the
meaning of Section 860G(a)(8) or result in the receipt by the Lower
Tier REMIC
of any "income from non-permitted assets" within the meaning of
Section
860F(a)(2)(B) of the Code or any "net income from foreclosure
property" which is
subject to taxation under Section 860G(a)(1) of the Code. Pursuant
to its
efforts to sell such REO Property, the Servicer shall either itself
or through
an agent selected by the Servicer protect and conserve such REO
Property in the
same manner and to such extent as is customary in the locality
where such REO
Property is located and may, incident to its conservation and
protection of the
interests of the Trustee on behalf of the Certificateholders, rent
the same, or
any part thereof, as the Servicer deems to be in the best interest
of the
Trustee on behalf of the Certificateholders for the period prior to
the sale of
such REO Property; provided, however, that any rent received or
accrued with
respect to such REO Property qualifies as "rents from real
property" as defined
in Section 856(d) of the Code.
Section 3.18 Notification of Adjustments. With respect to each
Adjustable Rate Mortgage Loan, the Servicer shall adjust the
Mortgage Interest
Rate on the related Adjustment Date and shall adjust the Scheduled
Payment on
the related mortgage payment adjustment date, if applicable, in
compliance with
the requirements of applicable law and the related Mortgage and
Mortgage Note.
In the event that an Index becomes unavailable or otherwise
unpublished, the
Servicer shall select a comparable alternative index over which it
has no direct
control and which is readily verifiable. The Servicer shall execute
and deliver
any and all necessary notices required under applicable law and the
terms of the
related Mortgage Note and Mortgage regarding the Mortgage Interest
Rate and
Scheduled Payment adjustments. The Servicer shall promptly, upon
written request
therefor, deliver to the Trustee such notifications and any
additional
applicable data regarding such adjustments and the methods used to
calculate and
implement such adjustments. Upon the discovery by the Servicer or
the receipt of
notice from the Trustee that the Servicer has failed to adjust a
Mortgage
Interest Rate or Scheduled Payment in accordance with the terms of
the related
Mortgage Note, the Servicer shall deposit in the Collection Account
from its own
funds the amount of any interest loss caused as such interest loss
occurs.
Section 3.19 Access to Certain Documentation and Information
Regarding the Mortgage Loans. The Servicer shall provide, or cause
the
Subservicer to provide, to the Depositor, the Trustee, the OTS or
the FDIC and
the examiners and supervisory agents thereof access to the
documentation
regarding the Mortgage Loans in its possession required by
applicable
regulations of the OTS. Such access shall be afforded without
charge, but only
upon reasonable and prior written request and during normal
business hours at
the offices of the Servicer, the Depositor, the Trustee or any
Subservicer.
Nothing in this Section shall derogate from the obligation of any
such party to
observe any applicable law prohibiting disclosure of information
regarding the
Mortgagors and the failure of any such party to provide access as
provided in
this Section as a result of such obligation shall not constitute a
breach of
this Section.
Section 3.20 Documents, Records and Funds in Possession of the
Servicer to Be Held for the Trustee. The Servicer shall account
fully to the
Trustee for any funds received by the Servicer or which otherwise
are collected
by the Servicer as Liquidation Proceeds, Condemnation Proceeds or
Insurance
Proceeds in respect of any Mortgage Loan. All Mortgage Files and
funds collected
or held by, or under the control of, the Servicer in respect of any
Mortgage
Loans, whether from the collection of principal and interest
payments or from
Liquidation Proceeds, including, but not limited to, any funds on
deposit in the
Collection Account, shall be held by the Servicer for and on behalf
of the
Trustee and shall be and remain the sole and exclusive property of
the Trustee,
subject to the applicable provisions of this Agreement. The
Servicer also agrees
that it shall not create, incur or subject any Mortgage File or any
funds that
are deposited in the Collection Account, the Distribution Account
or any Escrow
Account, or any funds that otherwise are or may become due or
payable to the
Trustee for the benefit of the Certificateholders, to any claim,
lien, security
interest, judgment, levy, writ of attachment or other encumbrance,
or assert by
legal action or otherwise any claim or right of setoff against any
Mortgage File
or any funds collected on, or in connection with, a Mortgage Loan,
except,
however, that the Servicer shall be entitled to set off against and
deduct from
any such funds any amounts that are properly due and payable to the
Servicer
under this Agreement.
Section 3.21 Servicing Compensation. (a) As compensation for
its
activities hereunder, the Servicer shall, with respect to each
Mortgage Loan, be
entitled to retain from deposits to the Collection Account and from
Liquidation
Proceeds, Insurance Proceeds and Condemnation Proceeds related to
such Mortgage
Loan, the Servicing Fee with respect to each Mortgage Loan (less
any portion of
such amounts retained by any Subservicer). In addition, the
Servicer shall be
entitled to recover unpaid Servicing Fees out of related late
collections to the
extent permitted in Section 3.11. The right to receive the
Servicing Fee may not
be transferred in whole or in part except as provided in Section
6.06 or in
connection with the transfer of all of the Servicer's
responsibilities and
obligations under this Agreement; provided, however, that the
Servicer may pay
from the Servicing Fee any amounts due to a Subservicer pursuant to
a
Subservicing Agreement entered into under Section 3.02.
(b) Additional servicing compensation in the form of assumption
or
modification fees, late payment charges, NSF fees, reconveyance
fees and other
similar fees and charges (other than Prepayment Premiums) shall be
retained by
the Servicer only to the extent such fees or charges are received
by the
Servicer. The Servicer shall also be entitled pursuant to Section
3.11(a)(iv) to
withdraw from the Collection Account, as additional servicing
compensation,
interest or other income earned on deposits therein.
(c) The Servicer shall be required to pay all expenses incurred
by
it in connection with its servicing activities hereunder (including
payment of
premiums for any blanket policy insuring against hazard losses
pursuant to
Section 3.13, servicing compensation of the Subservicer to the
extent not
retained by it and the fees and expenses of independent accountants
and any
agents appointed by the Servicer), and shall not be entitled to
reimbursement
therefor except as specifically provided in Section 3.11.
Section 3.22 Annual Statement as to Compliance. The Servicer
will
deliver or cause to be delivered to the Depositor, the Rating
Agencies and the
Trustee on or before March 15th of each calendar year, commencing
in 2006, an
Officer's Certificate stating, as to each signatory thereof, that
(i) a review
of the activities of the Servicer during the preceding calendar
year and of
performance under this Agreement or a similar agreement has been
made under such
officers' supervision, and (ii) to the best of such officers'
knowledge, based
on such review, the Servicer has fulfilled in all material respects
all of its
obligations under this Agreement throughout such year, or, if there
has been a
default in the fulfillment of any such obligation in any material
respect,
specifying each such default known to such officers and the nature
and status
thereof. Promptly after receipt of such Officer's Certificate, the
Depositor
shall review such Officer's Certificate and, if applicable, consult
with the
Servicer as to the nature of any defaults by the Servicer in the
fulfillment of
any of the Servicer's obligations. The obligations of the Servicer
under this
Section apply to each Servicer that serviced during the applicable
period,
whether or not such Servicer is acting as the Servicer at the time
such
Officer's Certificate is required to be delivered.
Section 3.23 Annual Independent Public Accountants' Servicing
Statement; Financial Statements. Not later than March 15th of each
calendar year
commencing in 2006, the Servicer, at its expense, shall cause a
nationally
recognized firm of independent certified public accountants to
furnish to the
Depositor, the Rating Agencies and the Trustee a report stating
that (i) it has
obtained a letter of representation regarding certain matters from
the
management of the Servicer which includes an assertion that the
Servicer has
complied with certain minimum residential mortgage loan servicing
standards,
identified in the Uniform Single Attestation Program for Mortgage
Bankers
established by the Mortgage Bankers Association of America, with
respect to the
servicing of residential mortgage loans during the most recently
completed
calendar year and (ii) on the basis of an examination conducted by
such firm in
accordance with standards established by the American Institute of
Certified
Public Accountants, such representation is fairly stated in all
material
respects, subject to such exceptions and other qualifications that
may be
appropriate. In rendering its report such firm may rely, as to
matters relating
to the direct servicing of residential mortgage loans by
Subservicers, upon
comparable reports of firms of independent certified public
accountants rendered
on the basis of examinations conducted in accordance with the same
standards
(rendered within one year of such report) with respect to those
Subservicers.
Promptly after receipt of such report, the Depositor shall review
such report
and, if applicable, consult with the Servicer as to the nature of
any defaults
by the Servicer in the fulfillment of any of the Servicer's
obligations. The
obligations of the Servicer under this Section apply to each
Servicer that
serviced during the applicable period, whether or not such Servicer
is acting as
the Servicer at the time such report is required to be
delivered.
Section 3.24 Trustee to Act as Servicer. (a) In the event that
the
Servicer shall for any reason no longer be the Servicer hereunder
(including by
reason of an Event of Default), the Trustee or its successor,
subject to the
rights of the Servicing Rights Pledgee (if any) under Sections 6.06
and 7.02,
shall thereupon assume all of the rights and obligations of the
Servicer
hereunder arising thereafter (except that the Trustee shall not be
(i) liable
for losses of the predecessor Servicer pursuant to Section 3.10 or
any acts or
omissions of the predecessor Servicer hereunder, (ii) obligated to
make Advances
if it is prohibited from doing so by applicable law, (iii)
obligated to
effectuate repurchases or substitutions of Mortgage Loans
hereunder, including
but not limited to repurchases or substitutions pursuant to Section
2.03, (iv)
responsible for expenses of the Servicer pursuant to Section 2.03
or (v) deemed
to have made any representations and warranties of the Servicer
hereunder). Any
such assumption shall be subject to Sections 6.06 and 7.02.
(b) Every Subservicing 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.
(c) If the Servicer shall for any reason no longer be the
Servicer
(including by reason of any Event of Default), the Trustee (or any
other
successor Servicer) may, at its option, succeed to any rights and
obligations of
the Servicer under any Subservicing Agreement in accordance with
the terms
thereof; provided, that the Trustee (or any other successor
Servicer) shall not
incur any liability or have any obligations in its capacity as
successor
Servicer under a Subservicing Agreement arising prior to the date
of such
succession unless it expressly elects to succeed to the rights and
obligations
of the Servicer thereunder; and the Servicer shall not thereby be
relieved of
any liability or obligations under the Subservicing Agreement
arising prior to
the date of such succession.
(d) The Servicer shall, upon request of the Trustee, but at the
expense of the Servicer, deliver to the assuming party all
documents and records
relating to each Subservicing Agreement (if any) and the Mortgage
Loans then
being serviced thereunder and an accounting of amounts collected
held by it and
otherwise use its best efforts to effect the orderly and efficient
transfer of
the Subservicing Agreement to the assuming party.
Section 3.25 Compensating Interest. The Servicer shall remit to
the
Trustee on each Remittance Date an amount from its own funds equal
to
Compensating Interest payable by the Servicer for such Remittance
Date.
Section 3.26 Credit Reporting; Gramm-Leach-Bliley Act. (a) With
respect to each Mortgage Loan, the Servicer shall fully furnish, in
accordance
with the Fair Credit Reporting Act and its implementing
regulations, accurate
and complete information (e.g., favorable and unfavorable) on the
related
Mortgagor credit files to Equifax, Experian, and TransUnion Credit
Information
Company (three of the national credit repositories), on a monthly
basis.
(b) The Servicer shall comply with all provisions of the
Privacy
Laws, relating to the Mortgage Loans, the related borrowers and any
"nonpublic
personal information" (as defined in the Privacy Laws) received by
the Servicer
incidental to the performance of its obligations under this
Agreement,
including, maintaining adequate information security procedures to
protect such
nonpublic personal information and providing all privacy notices
required by the
Privacy Laws.
Section 3.27 Excess Reserve Fund Account; Distribution Account.
(a) The Trustee shall establish and maintain the Excess Reserve
Fund
Account, on behalf of the Class X Certificateholders, to receive
any Basis Risk
Payment and any Interest Rate Corridor Payments and to pay to the
LIBOR
Certificateholders Basis Risk Carry Forward Amounts.
On each Distribution Date on which there exists a Basis Risk
Carry
Forward Amount on any Class of LIBOR Certificates, the Trustee
shall (1)
withdraw from the Distribution Account and deposit in the Excess
Reserve Fund
Account, as set forth in Section 4.02(a)(iii)(J), the lesser of the
Class X
Distributable Amount (to the extent remaining after the
distributions specified
in Sections 4.02(a)(iii)(A)-(I)) and the aggregate Basis Risk Carry
Forward
Amount and (2) withdraw from the Excess Reserve Fund Account
amounts necessary
to pay to such Class or Classes of Certificates the applicable
Basis Risk Carry
Forward Amounts. Such payments shall be allocated to those Classes
based upon
the amount of Basis Risk Carry Forward Amount owed to each such
Class and shall
be paid in the priorities set forth in Sections
4.02(a)(iii)(K)-(L).
The Trustee shall account for the Excess Reserve Fund Account as
an
asset of a grantor trust under subpart E, Part I of subchapter J of
the Code and
not as an asset of any Trust REMIC created pursuant to this
Agreement. The
beneficial owners of the Excess Reserve Fund Account are the Class
X
Certificateholders. For all federal income tax purposes, amounts
transferred by
the Class X REMIC to the Excess Reserve Fund Account shall be
treated as
distributions by the Trustee, for federal income tax purposes, in
respect of the
Class X Regular Interest from the Class X REMIC to the Class X
Certificateholders.
Any Basis Risk Carry Forward Amounts distributed by the Trustee
to
the LIBOR Certificateholders shall be accounted for by the Trustee
as amounts
paid first to the Holders of the Class X Certificates (as recipient
of 100% of
amounts payable in respect of the Class X Regular Interest) and
then to the
respective Class or Classes of LIBOR Certificates. In addition, the
Trustee
shall account for the rights of Holders of each Class of LIBOR
Certificates to
receive payments of Basis Risk Carry Forward Amounts as rights in a
separate
limited recourse interest rate cap contract written by the Class
X
Certificateholders in favor of Holders of each such Class.
Notwithstanding any provision contained in this Agreement, the
Trustee shall not be required to make any payments from the Excess
Reserve Fund
Account except as expressly set forth in this Section 3.27(a).
(b) The Trustee shall establish and maintain the Distribution
Account on behalf of the Certificateholders. The Trustee shall,
promptly upon
receipt on the Business Day received, deposit in the Distribution
Account and
retain therein the following:
(i) the aggregate amount remitted by the Servicer to the
Trustee
pursuant
to Section 3.11;
(ii) any amount deposited by the Servicer pursuant to Section
3.12(b) in
connection with any losses on Permitted Investments;
(iii) any amounts remitted by the Servicer to the Trustee in
respect
of
Compensating Interest pursuant to Section 3.25; and
(iv) any other amounts deposited hereunder which are required to
be
deposited
in the Distribution Account.
In the event that the Servicer shall remit any amount not
required
to be remitted, it may at any time direct the Trustee in writing to
withdraw
such amount from the Distribution Account, any provision herein to
the contrary
notwithstanding. Such direction may be accomplished by delivering
notice to the
Trustee which describes the amounts deposited in error in the
Distribution
Account. All funds deposited in the Distribution Account shall be
held by the
Trustee in trust for the Certificateholders until disbursed in
accordance with
this Agreement or withdrawn in accordance with Section 4.02.
(c) In order to comply with its duties under the USA Patriot Act
of
2001, the Trustee shall obtain and verify certain information and
documentation
from the other parties to this Agreement including, but not limited
to, each
such party's name, address, and other identifying information.
Section 3.28 Optional Purchase of Delinquent Mortgage Loans. Each
of
the Depositor and the Servicer, in each case in its sole
discretion, shall have
the option, but shall not be obligated, to purchase any 90+
Delinquent Mortgage
Loans from the Trust Fund. During the first ten (10) days after a
Mortgage Loan
becomes a 90+ Delinquent Mortgage Loan, the Depositor shall have
the exclusive
option to purchase such 90+ Delinquent Mortgage Loan. The purchase
price for any
such Mortgage Loan shall be 100% of the unpaid principal balance of
such
Mortgage Loan plus accrued and unpaid interest on the related
Mortgage Loan at
the applicable Mortgage Interest Rate, plus the amount of any
unreimbursed
Servicing Advances made by the Servicer. Upon receipt of such
purchase price,
the Servicer shall provide to the Trustee a Request for Release and
the Trustee
shall promptly release to the Depositor or the Servicer, as
applicable, the
Mortgage File relating to the Mortgage Loan being repurchased.
ARTICLE IV
DISTRIBUTIONS AND
ADVANCES BY THE SERVICER
Section 4.01 Advances. (a) The amount of P&I Advances to be
made by
the Servicer for any Remittance Date shall equal, subject to
Section 4.01(c),
the sum of (i) with respect to First Lien Mortgage Loans, the
aggregate amount
of Scheduled Payments (with each interest portion thereof net of
the related
Servicing Fee), due during the Due Period immediately preceding
such Remittance
Date in respect of such Mortgage Loans, which Scheduled Payments
were not
received as of the close of business on the related Determination
Date, (ii)
with respect to Second Lien Mortgage Loans for which Scheduled
Payments were not
received as of the close of business on the related Determination
Date, the
interest portion of the aggregate amount of Scheduled Payments (net
of the
related Servicing Fee), due during the Due Period immediately
preceding such
Remittance Date, (iii) with respect to each REO Property, which REO
Property was
acquired during or prior to the related Prepayment Period and as to
which such
REO Property an REO Disposition did not occur during the related
Prepayment
Period, an amount equal to the REO Imputed Interest that would have
been due on
the related Due Date in respect of the related Mortgage Loans and
(iv) with
respect to each balloon mortgage loan a payment equal to the
assumed monthly
payment that would have been due on the related Due Date based upon
the original
principal amortization schedule for such balloon mortgage loan.
(b) On the Remittance Date, the Servicer shall remit in
immediately
available funds to the Trustee for deposit in the Distribution
Account an amount
equal to the aggregate amount of P&I Advances, if any, to be
made in respect of
the Mortgage Loans and REO Properties for the related Remittance
Date either (i)
from its own funds or (ii) from the Collection Account, to the
extent of funds
held therein for future distribution (in which case, it will cause
to be made an
appropriate entry in the records of the Collection Account that
Amounts Held for
Future Distribution have been, as permitted by this Section 4.01,
used by the
Servicer in discharge of any such P&I Advance) or (iii) in the
form of any
combination of (i) and (ii) aggregating the total amount of P&I
Advances to be
made by the Servicer with respect to the Mortgage Loans and REO
Properties. Any
Amounts Held for Future Distribution and so used shall be
appropriately
reflected in the Servicer's records and replaced by the Servicer by
deposit in
the Collection Account on or before any future Remittance Date to
the extent
required. In addition, the Servicer shall have the right to
reimburse itself for
any outstanding P&I Advance made by it from its own funds from
Amounts Held For
Future Distribution. Any funds so applied and transferred pursuant
to the
previous sentence shall be replaced by the Servicer by deposit in
the Collection
Account no later than the close of business on the related
Remittance Date on
which such funds are required to be distributed pursuant to this
Agreement.
(c) The obligation of the Servicer to make such P&I Advances
is
mandatory, notwithstanding any other provision of this Agreement
but subject to
(d) below, and, with respect to any Mortgage Loan or REO Property,
shall
continue until a Final Recovery Determination in connection
therewith or the
removal thereof from coverage under this Agreement, except as
otherwise provided
in this Section 4.01.
(d)
Notwithstanding anything herein to the contrary, no P&I
Advance
or Servicing Advance shall be required to be made hereunder by the
Servicer if
such P&I Advance or Servicing Advance would, if made,
constitute a
Nonrecoverable P&I Advance or Nonrecoverable Servicing Advance.
The
determination by the Servicer that it has made a Nonrecoverable
P&I Advance or a
Nonrecoverable Servicing Advance or that any proposed P&I
Advance or Servicing
Advance, if made, would constitute a Nonrecoverable P&I Advance
or a
Nonrecoverable Servicing Advance, respectively, shall be evidenced
by an
Officer's Certificate of the Servicer delivered to the Trustee. In
addition, the
Servicer shall not be required to advance any Relief Act Interest
Shortfalls or
to cover Prepayment Interest Shortfalls in excess of its
obligations under
Section 3.25.
(e) Except as otherwise provided herein, the Servicer shall be
entitled to reimbursement pursuant to Section 3.11 for Servicing
Advances from
recoveries from the related Mortgagor or from all Liquidation
Proceeds and other
payments or recoveries (including Insurance Proceeds and
Condemnation Proceeds)
with respect to the related Mortgage Loan.
Section 4.02 Priorities of Distribution. (a) On each
Distribution
Date, the Trustee shall make the disbursements and transfers from
amounts then
on deposit in the Distribution Account in the following order of
priority and to
the extent of the Available Funds remaining:
(i) from the Interest Remittance Amount, to the holders of each
Class of
LIBOR Certificates in the following order of priority:
(A) concurrently, (1) from the Interest Remittance Amount
related to the Group I Mortgage Loans to the Class A-1A
Certificates
and Class A-1B Certificates, their related Accrued Certificate
Interest Distribution Amounts and Unpaid Interest Amounts for
such
Distribution Date allocated in accordance with clauses (iv) and
(v)
of this Section 4.02(a); and (2) from the Interest Remittance
Amount
related to the Group II Mortgage Loans to the Class A-2A, Class
A-2B
and Class A-2C Certificates, their related Accrued Certificate
Interest Distribution Amounts and Unpaid Interest Amounts for
such
Distribution Date allocated in accordance with clauses (iv) and
(v)
of this Section 4.02(a); provided, that if the Interest
Remittance
Amount for either Loan Group is insufficient to make the
related
payments set forth in clause (1) or (2) above, any Interest
Remittance Amount relating to the other Loan Group remaining
after
payment of the related Accrued Certificate Interest Distribution
and
Unpaid Interest
Amount will be available to cover that shortfall;
(B) from any remaining Interest Remittance Amount, to the
Class M-1 Certificates, the Accrued Certificate Interest
Distribution Amount for such Class;
(C) from any remaining Interest Remittance Amount, to the
Class M-2 Certificates, the Accrued Certificate Interest
Distribution Amount for such Class;
(D) from any remaining Interest Remittance Amount, to the
Class M-3 Certificates, the Accrued Certificate Interest
Distribution Amount for such Class;
(E) from any remaining Interest Remittance Amount, to the
Class M-4 Certificates, the Accrued Certificate Interest
Distribution Amount for such Class;
(F) from any remaining Interest Remittance Amount, to the
Class M-5 Certificates, the Accrued Certificate Interest
Distribution Amount for such Class;
(G) from any remaining Interest Remittance Amount, to the
Class M-6 Certificates, the Accrued Certificate Interest
Distribution Amount for such Class;
(H) from any remaining Interest Remittance Amount, to the
Class B-1 Certificates, the Accrued Certificate Interest
Distribution Amount for such Class;
(I) from any remaining Interest Remittance Amount, to the
Class B-2 Certificates, the Accrued Certificate Interest
Distribution Amount for such Class; and
(J) from any remaining Interest Remittance Amount, to the
Class B-3 Certificates, the Accrued Certificate Interest
Distribution Amount for such Class.
(ii) (A) on each Distribution Date (a) prior to the Stepdown Date
or
(b) with
respect to which a Trigger Event is in effect, to the holders
of
the Class
or Classes of LIBOR Certificates then entitled to distributions
of
principal as set forth below, an amount equal to the Principal
Distribution Amount in the following order of priority:
(a) to the Class A Certificates, allocated as described in
Section
4.02(c),
until their respective Class Certificate Balances are reduced
to
zero;
(b) sequentially, to the Class M-1, Class M-2, Class M-3, Class
M-4,
Class M-5,
Class M-6, Class B-1, Class B-2 and Class B-3 Certificates, in
that
order, until their respective Class Certificate Balances are
reduced
to
zero;
(B) on each Distribution Date (a) on and after the Stepdown
Date and
(b) as long as a Trigger Event is not in effect, to the holders
of the
Class or Classes of LIBOR Certificates then entitled to
distribution of principal, an amount equal to, the Principal
Distribution
Amount in
the following amounts and order of priority:
(a) the lesser of (x) the Principal Distribution Amount
and (y) the Class A Principal Distribution Amount to the Class
A Certificates, allocated as described in Section 4.02(c),
until the respective Class Certificate Balances thereof are
reduced to zero;
(b) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the amount distributed to the
Class A Certificates in clause (ii)(B)(a) above and (y) the
Class M-1 Principal Distribution Amount to the Class M-1
Certificates, until the Class Certificate Balance thereof has
been reduced to zero;
(c) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the amount distributed to the
Class A Certificates in clause (ii)(B)(a) above, to the Class
M-1 Certificates in clause (ii)(B)(b) above and (y) the Class
M-2 Principal Distribution Amount to the Class M-2
Certificates, until the Class Certificate Balance thereof has
been reduced to zero;
(d) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the amount distributed to the
Class A Certificates in clause (ii)(B)(a) above, to the Class
M-1 Certificates in clause (ii)(B)(b) above and to the Class
M-2
Certificates in clause (ii)(B)(c) above, and (y) the Class
M-3 Principal Distribution Amount to the Class M-3
Certificates, until the Class Certificate Balance thereof has
been reduced to zero;
(e) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the amount distributed to the
Class A Certificates in clause (ii)(B)(a) above, to the Class
M-1 Certificates in clause (ii)(B)(b) above, to the Class M-2
Certificates in clause (ii)(B)(c) above and to the Class M-3
Certificates in clause (ii)(B)(d) above, and (y) the Class M-4
Principal Distribution Amount, to the Class M-4 Certificates
until their Class Certificate Balance has been reduced to
zero;
(f) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the amount distributed to the
Class A Certificates in clause (ii)(B)(a) above, to the Class
M-1 Certificates in clause (ii)(B)(b) above, to the Class M-2
Certificates in clause (ii)(B)(c) above, to the Class M-3
Certificates in clause (ii)(B)(d) above and to the Class M-4
Certificates in clause (ii)(B)(e) above, and (y) the Class M-5
Principal Distribution Amount, to the Class M-5 Certificates
until their Class Certificate Balance has been reduced to
zero;
(g) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the amount distributed to the
Class A Certificates in clause (ii)(B)(a) above, to the Class
M-1 Certificates in clause (ii)(B)(b) above, to the Class M-2
Certificates in clause (ii)(B)(c) above, to the Class M-3
Certificates in clause (ii)(B)(d) above, to the Class M-4
Certificates in clause (ii)(B)(e) above and to the Class M-5
Certificates in clause (ii)(B)(f) above, and (y) the Class M-6
Principal Distribution Amount, to the Class M-6 Certificates
until their Class Certificate Balance has been reduced to
zero;
(h) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the amount distributed to the
Class A Certificates in clause (ii)(B)(a) above, to the Class
M-1 Certificates in clause (ii)(B)(b) above, to the Class M-2
Certificates in clause (ii)(B)(c) above, to the Class M-3
Certificates in clause (ii)(B)(d) above, to the Class M-4
Certificates in clause (ii)(B)(e) above, to the Class M-5
Certificates in clause (ii)(B)(f) above and to the Class M-6
Certificates in clause (ii)(B)(g) above, and (y) the Class B-1
Principal Distribution Amount, to the Class B-1 Certificates
until their Class Certificate Balance has been reduced to
zero;
(i) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the amount distributed to the
Class A Certificates in clause (ii)(B)(a) above, to the Class
M-1 Certificates in clause (ii)(B)(b) above, to the Class M-2
Certificates in clause (ii)(B)(c) above, to the Class M-3
Certificates in clause (ii)(B)(d) above, to the Class M-4
Certificates in clause (ii)(B)(e) above, to the Class M-5
Certificates in clause (ii)(B)(f) above, to the Class M-6
Certificates in clause (ii)(B)(g) above and to the Class B-1
Certificates in clause (ii)(B)(h) above, and (y) the Class B-2
Principal Distribution Amount, to the Class B-2 Certificates
until their Class Certificate Balance has been reduced to
zero; and
(j) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the amount distributed to the
Class A Certificates in clause (ii)(B)(a) above, to the Class
M-1 Certificates in clause (ii)(B)(b) above, to the Class M-2
Certificates in clause (ii)(B)(c) above, to the Class M-3
Certificates in clause (ii)(B)(d) above, to the Class M-4
Certificates in clause (ii)(B)(e) above, to the Class M-5
Certificates in clause (ii)(B)(f) above, to the Class M-6
Certificates in clause (ii)(B)(g) above, to the Class B-1
Certificates in clause (ii)(B)(h) above and to the Class B-2
Certificates in clause (ii)(B)(i) above, and (y) the Class B-3
Principal Distribution Amount, to the Class B-3 Certificates
until their Class Certificate Balance has been reduced to
zero;
(iii) any amount remaining after the distributions in Section
4.02(a)(i) and (ii) above shall be distributed in the following
order of priority:
(A) to the Class M-1 Certificates, any Unpaid Interest
Amount for such Class;
(B) to the Class M-2 Certificates, any Unpaid Interest
Amount for such Class;
(C) to the Class M-3 Certificates, any Unpaid Interest
Amount for such Class;
(D) to the Class M-4 Certificates, any Unpaid Interest
Amount for such Class;
(E) to the Class M-5 Certificates, any Unpaid Interest
Amount for such Class;
(F) to the Class M-6 Certificates, any Unpaid Interest
Amount for such Class;
(G) to the Class B-1 Certificates, any Unpaid Interest
Amount for such Class;
(H) to the Class B-2 Certificates, any Unpaid Interest
Amount for such Class;
(I) to the Class B-3 Certificates, any Unpaid Interest
Amount for such Class;
(J) to the Excess Reserve Fund Account, the amount of
any Basis Risk Payment for such Distribution Date;
(K) from funds on deposit in the Excess Reserve Fund
Account with respect to such Distribution Date (not including
any Interest Rate Corridor Payments included in that account),
an amount equal to any Basis Risk Carry Forward Amount with
respect to the LIBOR Certificates for such Distribution Date
to such Classes in the same order and priority as set forth in
Section 4.02(a)(i), with the allocation to the Class A
Certificates being pro rata based on their respective Basis
Risk Carry Forward Amounts;
(L) concurrently, (x) from any Interest Rate Corridor
Payments from the Class A-1 Corridor Agreement that are on
deposit in the Excess Reserve Fund with respect to that
Distribution Date, to the Class A-1 Certificates pro rata,
based on the respective Class Certificate Balances of each
Class A-1 Certificate with a Basis Risk Carry Forward Amount,
in each case up to their respective unpaid remaining Basis
Risk Carry Forward Amounts; (y) from any Interest Rate
Corridor Payments from the Class A-2 Corridor Agreement that
are on deposit in the Excess Reserve Fund with respect to that
Distribution Date, to the Class A-2 Certificates pro rata,
based on the respective Class Certificate Balances of each
Class A-2 Certificate with a Basis Risk Carry Forward Amount,
in each case, up to their respective unpaid remaining Basis
Risk Carry Forward Amounts; (z) from any Interest Rate
Corridor Payments from the Subordinated Corridor Agreement on
deposit in the Excess Reserve Fund Account with respect to
that Distribution Date, to the Subordinated Certificates pro
rata, based on the respective Class Certificate Balances of
each Subordinated Certificate with a Basis Risk Carry Forward
Amount, in each case up to their respective unpaid remaining
Basis Risk Carry Forward Amounts;
(M) to the Class X Certificates, the remainder of the
Class X Distributable
Amount not distributed pursuant to
Sections 4.02(a)(iii)(A)-(L);
(N) to the Class R-1 Certificates, any remaining amount,
in respect of the Lower-Tier REMIC and Upper-Tier REMIC; and
(O) to the Class R-2 Certificates, any remaining amount,
in respect of the Class B-1 REMIC, Class B-2 REMIC, Class B-3
REMIC and Class X REMIC.
(iv) Solely for purposes of interest allocation calculations,
the Interest Remittance Amount attributable to Group I Mortgage
Loans will be allocated:
(A) first, pro rata (based on the accrued and unpaid
interest distributable pursuant to Section 4.02(a)(i)(A)(1)),
to the Class A-1A Certificates and the Class A-1B
Certificates, the Accrued Certificate Interest Distribution
Amount and any Unpaid Interest Amount for each such Class; and
(B) second, pro rata (based on the accrued and unpaid
interest distributable pursuant to Section 4.02(a)(i)(A)(2)),
to the Class A-2A, Class A-2B and Class A-2C Certificates, the
Accrued Certificate Interest Distribution Amount and any
Unpaid Interest Amount for each such Class, to the extent not
otherwise previously paid from the Interest Remittance Amount
attributable to Group II Mortgage Loans;
(v) Solely for purposes of interest allocation calculations,
the portion of the Interest Remittance Amount attributable to
Group
II Mortgage Loans will be allocated:
(A) first, pro rata (based on the accrued and unpaid
interest distributable pursuant to Section 4.02(a)(i)(A)(2)),
to the Class A-2A, Class A-2B and Class A-2C Certificates, the
Accrued
Certificate Interest Distribution Amount and any
Unpaid Interest Amount for each such Class; and
(B) second, pro rata (based on the accrued and unpaid
interest distributable pursuant to Section 4.02(a)(i)(A)(1)),
to the Class A-1A Certificates and the Class A-1B
Certificates, the Accrued Certificate Interest Distribution
Amount and any Unpaid Interest Amount for each such Class, to
the extent not otherwise previously paid from the Interest
Remittance Amount attributable to Group I Mortgage Loans.
If on any Distribution Date, as a result of the foregoing
allocation
rules, any Class of Class A Certificates does not receive the
related Accrued
Certificate Interest Distribution Amount or the related Unpaid
Interest Amount,
if any, then that unpaid amount will be recoverable by the holders
of those
Classes, with interest thereon, on future Distribution Dates, as an
Unpaid
Interest Amount, subject to the priorities described above. In the
event the
Class Certificate Balance of any Class of Certificates has been
reduced to zero,
that Class of Certificates shall no longer be entitled to receive
any related
unpaid Basis Risk Carry Forward Amounts except to the extent the
Class
Certificate Balance is increased as a result of any Subsequent
Recovery.
Notwithstanding the foregoing, if the Stepdown Date is the date
on
which the Class Certificate Balance of the Class A Certificates is
reduced to
zero, any Principal Distribution Amount remaining after principal
distributions
to the Class A Certificates pursuant to clause (ii)(A) above will
be included as
part of the distributions pursuant to clause (ii)(B) above.
(b) On each Distribution Date, all amounts representing
Prepayment
Premiums from the Mortgage Loans received during the related
Prepayment Period
shall be distributed by the Trustee to the holders of the Class P
Certificates.
(c) All principal distributions to the Holders of the Class A
Certificates on any Distribution Date shall be allocated between
the Class A-1
Certificate Group and the Class A-2 Certificate Group based on the
Class A
Principal Allocation Percentage for the Class A-1 Certificate Group
or the Class
A-2 Certificate Group, as applicable; provided, however, that if
the aggregate
Class Certificate Balance of either Class A Certificate Group is
reduced to
zero, then the remaining amount of principal distributions
distributable to the
Class A Certificates on such Distribution Date, and the amount of
such principal
distributions distributable on all subsequent Distribution Dates,
shall be
distributed to the Class A Certificates remaining outstanding in
accordance with
the principal distribution allocations set forth in this Section
4.02(c), until
their Class Certificate Balances have been reduced to zero. Any
payments of
principal to the Class A-1 Certificate Group shall be made first
from Available
Funds relating to the Group I Mortgage Loans. Any payments of
principal to the
Class A-2 Certificate Group shall be made first from Available
Funds relating to
the Group II Mortgage Loans.
Any principal distributions allocated to the Class A-1
Certificate
Group shall be distributed pro rata between the Class A-1A
Certificates and the
Class A-1B Certificates, based on their respective Class
Certificate Balances,
until their Class Certificate Balances have been reduced to zero.
However, so
long as a Group I Sequential Trigger Event is in effect, principal
distributions
to the Class A-1 Certificate Group shall be allocated first to the
Class A-1A
Certificates, until their Class Certificate Balance has been
reduced to zero,
and then to the Class A-1B Certificates, until their Class
Certificate Balance
has been reduced to zero.
Any principal distributions allocated to the Class A-2
Certificate
Group shall be distributed sequentially, first to the Class A-2A
Certificates,
until their Class Certificate Balance has been reduced to zero,
second, to the
Class A-2B Certificates, until their Class Certificate Balance has
been reduced
to zero and third, to the Class 2-AC Certificates, until their
Class Certificate
Balance has been reduced to zero.
Notwithstanding the allocation of principal to the Class A
Certificates described in the preceding paragraphs, from and after
the
Distribution Date on which the aggregate Class Certificate Balances
of the
Subordinated Certificates and the principal balance of the Class X
Certificates
have been reduced to zero, any principal distributions allocated to
the Class A
Certificates are required to be allocated pro rata to the Class A
Certificates,
based on their respective Certificate Principal Balances.
(d) On any Distribution Date, any Relief Act Interest Shortfalls
and
Net Prepayment Interest Shortfalls for such Distribution Date shall
be allocated
by the Trustee pro rata, as a reduction of the Accrued Certificate
Interest
Distribution Amount for the LIBOR Certificates, based on the amount
of interest
to which such Classes would otherwise be entitled on such
Distribution Date.
Section 4.03 Monthly Statements to Certificateholders. (a) Not
later
than each Distribution Date, the Trustee shall make available to
each
Certificateholder, the Servicer, the Depositor and each Rating
Agency a
statement setting forth with respect to the related
distribution:
(i) the amount thereof allocable to principal, separately
identifying the aggregate amount of any Principal Prepayments
and
Liquidation Proceeds included therein;
(ii) the amount thereof allocable to interest, any Unpaid
Interest
Amounts
included in such distribution and any remaining Unpaid Interest
Amounts
after giving effect to such distribution, any Basis Risk Carry
Forward
Amount for such Distribution Date and the amount of all Basis
Risk
Carry
Forward Amounts covered by withdrawals from the Excess Reserve
Fund
Account on
such Distribution Date;
(iii) if the distribution to the Holders of such Class of
Certificates is less than the full amount that would be
distributable to
such
Holders if there were sufficient funds available therefor, the
amount
of the
shortfall and the allocation thereof as between principal and
interest,
including any Basis Risk Carry Forward Amount not covered by
amounts in
the Excess Reserve Fund Account;
(iv) the Class Certificate Balance of each Class of
Certificates
after
giving effect to the distribution of principal on such
Distribution
Date;
(v) the Pool Stated Principal Balance for the following
Distribution
Date;
(vi) the amount of the Expense Fees paid to or retained by the
Servicer
or the Trustee with respect to such Distribution Date;
(vii) the Pass-Through Rate for each such Class of Certificates
with
respect to
such Distribution Date;
(viii) the amount of Advances included in the distribution on
such
Distribution Date and the aggregate amount of Advances reported by
the
Servicer
as outstanding as of the close of business on the Determination
Date
immediately preceding such Distribution Date;
(ix) the number and aggregate outstanding principal balances of
Mortgage
Loans (1) as to which the Scheduled Payment is delinquent 31 to
60 days,
61 to 90 days and 91 or more days, (2) that have become REO
Property,
(3) that are in foreclosure and (4) that are in bankruptcy, in
each case
as of the close of business on the last Business Day of the
immediately preceding month;
(x) for each of the preceding 12 calendar months, or all
calendar
months
since the related Cut-off Date, whichever is less, the
aggregate
dollar
amount of the Scheduled Payments (A) due on all Outstanding
Mortgage
Loans on each of the Due Dates in each such month and (B)
delinquent
60 days or more on each of the Due Dates in each such month;
(xi) with respect to all Mortgage Loans that became REO
Properties
during the
preceding calendar month, the aggregate number of such Mortgage
Loans and
the aggregate Stated Principal Balance of such Mortgage Loans
as
of the
close of business on the Determination Date preceding such
Distribution Date and the date of acquisition thereof;
(xii) the total number and principal balance of any REO
Properties
(and
market value, if available) as of the close of business on the
Determination Date preceding such Distribution Date;
(xiii) whether a Trigger Event has occurred and is continuing
(including
the calculation of thereof and the aggregate outstanding
balance of
all 60+ Day Delinquent Mortgage Loans) and whether a Group I
Sequential
Trigger Event has occurred and is continuing;
(xiv) the amount on deposit in the Excess Reserve Fund Account
(after
giving effect to distributions on such Distribution Date);
(xv) in the aggregate and for each Class of Certificates, the
aggregate
amount of Applied Realized Loss Amounts incurred during the
preceding
calendar month and aggregate Applied Realized Loss Amounts
through
such Distribution Date;
(xvi) the amount of any Net Monthly Excess Cash Flow on such
Distribution Date and the allocation thereof to the
Certificateholders
with
respect to Unpaid Interest Amounts;
(xvii) the amount distributed on the Class P Certificates;
(xviii) the Overcollateralized Amount and Specified
Overcollateralized Amount;
(xix) Prepayment Premiums collected by the Servicer;
(xx) the Cumulative Loss Percentage;
(xxi) the amount distributed on the Class X Certificates; and
(xxii) the amount of any Subsequent Recoveries for such
Distribution
Date.
(b) The Trustee's responsibility for providing the above
statement
to the Certificateholders, each Rating Agency, the Servicer and the
Depositor is
limited to the availability, timeliness and accuracy of the
information derived
from the Servicer. The Trustee will provide the above statement via
the
Trustee's internet website. The Trustee's website will initially be
located at
https://www.tss.db.com/invr and assistance in using the website can
be obtained
by calling the Trustee's investor relations desk at 1-800-735-7777.
A paper copy
of the above statement will also be made available upon
request.
(c) Upon request, within a reasonable period of time after the
end
of each calendar year, the Trustee shall cause to be furnished to
each Person
who at any time during the calendar year was a Certificateholder, a
statement
containing the information set forth in clauses (a)(i), (a)(ii) and
(a)(vi) of
this Section 4.03 aggregated for such calendar year or applicable
portion
thereof during which such Person was a Certificateholder. Such
obligation of the
Trustee shall be deemed to have been satisfied to the extent that
substantially
comparable information shall be provided by the Trustee pursuant to
any
requirements of the Code as from time to time in effect.
(d) Not later than the Reporting Date, the Servicer that
serviced
the Mortgage Loans for the period of time to which the monthly
remittance advice
statement relates shall furnish to the Trustee a monthly remittance
advice
statement (in a format mutually agreed upon by the Servicer and the
Trustee)
containing such information as shall be reasonably requested by the
Trustee to
provide the reports required by Section 4.03(a) as to the
accompanying
remittance and the period ending on the close of business on the
last Business
Day of the immediately preceding month (the "Servicer Remittance
Report").
The Servicer shall furnish to the Trustee an individual loan
accounting report, as of the last Business Day of each month, to
document
Mortgage Loan payment activity on an individual Mortgage Loan
basis. With
respect to each month, the corresponding individual loan accounting
report (in
electronic format) shall be received by the Trustee no later than
the Reporting
Date, which report shall contain the following:
(i) with respect to each Scheduled Payment, the amount of such
remittance
allocable to principal (including a separate breakdown of any
Principal
Prepayment, including the date of such prepayment, and any
Prepayment
Premiums, along with a detailed report of interest on Principal
Prepayment
amounts remitted in accordance with Section 3.25);
(ii) with respect to each Scheduled Payment, the amount of such
remittance
allocable to interest;
(iii) the amount of servicing compensation received by the
Servicer
during the
prior distribution period;
(iv) the individual and aggregate Stated Principal Balance of
the
Mortgage
Loans;
(v) the aggregate of any expenses reimbursed to the Servicer
during
the prior
distribution period pursuant to Section 3.11;
(vi) each Mortgage Loan which has been altered, modified or
varied
during
such month, and the reason for such modification (i.e.,
extension
of
maturity date or Mortgage Interest Rate);
(vii) the number and aggregate outstanding principal balances
of
Mortgage
Loans (a) delinquent (1) 31 to 60 days, (2) 61 to 90 days, or
(3)
91 days or
more; (b) as to which foreclosure has commenced; and (c) as to
which REO
Property has been acquired;
(viii) with respect to each Liquidated Mortgage Loan, the amount
of
any
Realized Losses for such Mortgage Loan; and
(ix) any other information reasonably required by the Trustee
to
enable it
to prepare the Monthly Statement referred to in Section
4.03(a).
Section 4.04 Certain Matters Relating to the Determination of
LIBOR.
LIBOR shall be calculated by the Trustee in accordance with the
definition of
"LIBOR". Until all of the LIBOR Certificates are paid in full, the
Trustee will
at all times retain at least four Reference Banks for the purpose
of determining
LIBOR with respect to each LIBOR Determination Date. The Trustee
initially shall
designate the Reference Banks (after consultation with the
Depositor). Each
"Reference Bank" shall be a leading bank engaged in transactions in
Eurodollar
deposits in the international Eurocurrency market, shall not
control, be
controlled by, or be under common control with, the Trustee and
shall have an
established place of business in London. If any such Reference Bank
should be
unwilling or unable to act as such or if the Trustee should
terminate its
appointment as Reference Bank, the Trustee shall promptly appoint
or cause to be
appointed another Reference Bank (after consultation with the
Depositor). The
Trustee shall have no liability or responsibility to any Person for
(i) the
selection of any Reference Bank for purposes of determining LIBOR
or (ii) any
inability to retain at least four Reference Banks which is caused
by
circumstances beyond its reasonable control.
The Pass-Through Rate for each Class of LIBOR Certificates for
each
Interest Accrual Period shall be determined by the Trustee on each
LIBOR
Determination Date so long as the LIBOR Certificates are
Outstanding on the
basis of LIBOR and the respective formulae appearing in footnotes
corresponding
to the LIBOR Certificates in the table relating to the Certificates
in the
Preliminary Statement. The Trustee shall not have any liability
or
responsibility to any Person for its inability, following a
good-faith
reasonable effort, to obtain quotations from the Reference Banks or
to determine
the arithmetic mean referred to in the definition of LIBOR, all as
provided for
in this Section 4.04 and the definition of LIBOR. The establishment
of LIBOR and
each Pass-Through Rate for the LIBOR Certificates by the Trustee
shall (in the
absence of manifest error) be final, conclusive and binding upon
each Holder of
a Certificate and the Trustee.
Section 4.05 Allocation of Applied Realized Loss Amounts. Any
Applied Realized Loss Amounts shall be allocated by the Trustee to
the most
junior Class of Subordinated Certificates then Outstanding in
reduction of the
Class Certificate Balance thereof. In the event Applied Realized
Loss Amounts
are allocated to any Class of Certificates, their Class Certificate
Balances
shall be reduced by the amount so allocated, and no funds will be
distributable
with respect to the written down amounts (including without
limitation Basis
Risk Carry Forward Amounts) or with respect to interest on the
written down
amounts on that Distribution Date or any future Distribution Dates,
even if
funds are otherwise available for distribution. Notwithstanding the
foregoing,
the Class Certificate Balance of each Class of Subordinated
Certificates that
has been previously reduced by Applied Realized Loss Amounts will
be increased,
in order of seniority, by the amount of the Subsequent Recoveries
(but not in
excess of the Applied Realized Loss Amount allocated to the
applicable Class of
Subordinated Certificates).
ARTICLE V
THE CERTIFICATES
Section 5.01 The Certificates. The Certificates shall be
substantially in the forms attached hereto as exhibits. The
Certificates shall
be issuable in registered form, in the minimum denominations,
integral multiples
in excess thereof (except that one Certificate in each Class may be
issued in a
different amount, which must be in excess of the applicable
minimum
denomination) and aggregate denominations per Class set forth in
the Preliminary
Statement.
The Depositor hereby directs the Trustee to register the Class P
and
Class X Certificates in the name of the Depositor or its designee.
On a date as
to which the Depositor notifies the Trustee, the Depositor hereby
directs the
Trustee to transfer the Class X and Class P Certificates in the
name of Goldman,
Sachs & Co., or such other name or names as the Depositor shall
request
(including any NIM Trustee). In the case of the Class R
Certificates, the
Depositor hereby directs the Trustee to register such Certificates
in the name
of the Servicer, an Affiliate of the Servicer, or a designee
thereof.
Subject to Section 9.02 respecting the final distribution on
the
Certificates, on each Distribution Date the Trustee shall make
distributions to
each Certificateholder of record on the preceding Record Date
either (x) by wire
transfer in immediately available funds to the account of such
holder at a bank
or other entity having appropriate facilities therefor as directed
by that
Certificateholder by written wire instructions provided to the
Trustee or (y),
in the event that no wire instructions are provided to the Trustee,
by check
mailed by first class mail to such Certificateholder at the address
of such
Holder appearing in the Certificate Register.
The Certificates shall be executed by manual or facsimile
signature
on behalf of the Trustee by an authorized officer. Certificates
bearing the
manual or facsimile signatures of individuals who were, at the time
such
signatures were affixed, authorized to sign on behalf of the
Trustee shall bind
the Trustee, notwithstanding that such individuals or any of them
have ceased to
be so authorized prior to the authentication and delivery of any
such
Certificates or did not hold such offices at the date of such
Certificate. No
Certificate shall be entitled to any benefit under this Agreement,
or be valid
for any purpose, unless authenticated by the Trustee by manual
signature, and
such authentication upon any Certificate shall be conclusive
evidence, and the
only evidence, that such Certificate has been duly executed and
delivered
hereunder. All Certificates shall be dated the date of their
authentication. On
the Closing Date, the Trustee shall authenticate the Certificates
to be issued
at the direction of the Depositor or any Affiliate thereof.
Section 5.02 Certificate Register; Registration of Transfer and
Exchange of Certificates. (a) The Trustee shall maintain, or cause
to be
maintained in accordance with the provisions of Section 5.06, a
Certificate
Register for the Trust Fund in which, subject to the provisions of
subsections
(b) and (c) below and to such reasonable regulations as it may
prescribe, the
Trustee shall provide for the registration of Certificates and of
transfers and
exchanges of Certificates as herein provided. Upon surrender for
registration of
transfer of any Certificate, the Trustee shall execute and deliver,
in the name
of the designated transferee or transferees, one or more new
Certificates of the
same Class and aggregate Percentage Interest.
At the option of a Certificateholder, Certificates may be
exchanged
for other Certificates of the same Class in authorized
denominations and
evidencing the same aggregate Percentage Interest upon surrender of
the
Certificates to be exchanged at the office or agency of the
Trustee. Whenever
any Certificates are so surrendered for exchange, the Trustee shall
execute,
authenticate, and deliver the Certificates which the
Certificateholder making
the exchange is entitled to receive. Every Certificate presented or
surrendered
for registration of transfer or exchange shall be accompanied by a
written
instrument of transfer in form satisfactory to the Trustee duly
executed by the
Holder thereof or his attorney duly authorized in writing. In the
event the
Depositor or an Affiliate of the Depositor transfers the
Certificates, or a
portion thereof, to another Affiliate, it shall notify the Trustee
in writing of
the affiliated status of the transferee. The Trustee shall have no
liability
regarding the lack of notice with respect thereto.
No service
charge to the Certificateholders shall be made for any
registration of transfer or exchange of Certificates, but payment
of a sum
sufficient to cover any tax or governmental charge that may be
imposed in
connection with any transfer or exchange of Certificates may be
required.
All Certificates surrendered for registration of transfer or
exchange shall be cancelled and subsequently destroyed by the
Trustee in
accordance with the Trustee's customary procedures.
(b) No transfer of a Private Certificate shall be made unless
such
transfer is made pursuant to an effective registration statement
under the
Securities Act and any applicable state securities laws or is
exempt from the
registration requirements under said Act and such state securities
laws. Except
with respect to (i) the transfer of the Class X, Class P or Class R
Certificates
to the Depositor or an Affiliate of the Depositor, (ii) the
transfer of the
Class X or Class P Certificates by the Depositor or any Affiliate
of the
Depositor to the NIM Issuer or the NIM Trustee, (iii) a transfer of
the Class X
or Class P Certificates from the NIM Issuer or the NIM Trustee to
the Depositor
or an Affiliate of the Depositor or (iv) a transfer of a Class R
Certificate to
the Servicer, an Affiliate of the Servicer, or its designee
(including, without
limitation, an employee of the Servicer who is an "accredited
investor" as
defined in Regulation D under the Securities Act), in the event
that a transfer
of a Private Certificate which is a Physical Certificate is to be
made in
reliance upon an exemption from the Securities Act and such laws,
in order to
assure compliance with the Securities Act and such laws, the
Certificateholder
desiring to effect such transfer shall certify to the Trustee in
writing the
facts surrounding the transfer in substantially the form set forth
in Exhibit H
(the "Transferor Certificate") and either (i) there shall be
delivered to the
Trustee a letter in substantially the form of Exhibit I (the "Rule
144A Letter")
or Exhibit J (the "Non-Rule 144A Investment Letter") or (ii) in the
case of the
Class X Certificates, there shall be delivered to the Trustee at
the expense of
the transferor an Opinion of Counsel that such transfer may be made
without
registration under the Securities Act. In the event that a transfer
of a Private
Certificate which is a Book-Entry Certificate is to be made in
reliance upon an
exemption from the Securities Act and such laws, in order to assure
compliance
with the Securities Act and such laws, the Certificateholder
desiring to effect
such transfer will be deemed to have made as of the transfer date
each of the
certifications set forth in the Transferor Certificate in respect
of such
Certificate and the transferee will be deemed to have made as of
the transfer
date each of the certifications set forth in the Rule 144A Letter
in respect of
such Certificate, in each case as if such Certificate were
evidenced by a
Physical Certificate. A transferee of any Private Certificate who
is not a
"qualified institutional buyer" as that term is defined in Rule
144A of the
Securities Act must take delivery of such Private Certificates in
definitive
form. The Depositor shall provide to any Holder of a Private
Certificate and any
prospective transferee designated by any such Holder, information
regarding the
related Certificates and the Mortgage Loans and such other
information as shall
be necessary to satisfy the condition to eligibility set forth in
Rule
144A(d)(4) for transfer of any such Certificate without
registration thereof
under the Securities Act pursuant to the registration exemption
provided by Rule
144A. The Trustee and the Servicer shall cooperate with the
Depositor in
providing the Rule 144A information referenced in the preceding
sentence,
including providing to the Depositor such information regarding
the
Certificates, the Mortgage Loans and other matters regarding the
Trust Fund as
the Depositor shall reasonably request to meet its obligation under
the
preceding sentence. Each Holder of a Private Certificate desiring
to effect such
transfer shall, and does hereby agree to, indemnify the Trustee,
the Depositor
and the Servicer against any liability that may result if the
transfer is not so
exempt or is not made in accordance with such federal and state
laws.
Except with respect to (i) the transfer of the Class X, Class P
or
Class R Certificates to the Depositor or an Affiliate of the
Depositor, (ii) the
transfer of the Class X or Class P Certificates by the Depositor or
an Affiliate
of the Depositor to the NIM Iss
