EXHIBIT 99.1
------------
The Pooling and Servicing Agreement
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Execution Copy
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INDYMAC MBS, INC.
Depositor
INDYMAC BANK, F.S.B.
Seller and Servicer
DEUTSCHE BANK NATIONAL TRUST COMPANY
Trustee
----------------------------------------
POOLING AND SERVICING AGREEMENT
Dated as of October 1, 2006
----------------------------------------
RESIDENTIAL ASSET SECURITIZATION TRUST
Series 2006-A13
MORTGAGE PASS-THROUGH CERTIFICATES
Series 2006-M
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TABLE OF CONTENTS
Page
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ARTICLE ONE
DEFINITIONS.......................................................................................4
Section 1.01
Definitions............................................................................4
Section 1.02 Rules of
Construction.................................................................32
ARTICLE TWO CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND
WARRANTIES.....................................35
Section 2.01 Conveyance
of Mortgage
Loans..........................................................35
Section 2.02 Acceptance
by the Trustee of the Mortgage
Loans.......................................38
Section 2.03
Representations, Warranties, and Covenants of the Seller and the
Servicer.............40
Section 2.04
Representations and Warranties of the Depositor as to the Mortgage
Loans..............41
Section 2.05 Delivery
of Opinion of Counsel in Connection with
Substitutions.......................42
Section 2.06 Execution
and Delivery of
Certificates................................................42
Section 2.07 REMIC
Matters.........................................................................42
ARTICLE THREE ADMINISTRATION AND SERVICING OF MORTGAGE
LOANS.................................................43
Section 3.01 Servicer
to Service Mortgage
Loans....................................................43
Section 3.02
[Reserved]............................................................................44
Section 3.03 Rights of
the Depositor and the Trustee in Respect of the
Servicer....................44
Section 3.04
[Reserved]............................................................................44
Section 3.05 Trustee to
Act as
Servicer............................................................44
Section 3.06 Collection
of Mortgage Loan Payments; Certificate Account; Distribution
Account...............................................................................44
Section 3.07 Collection
of Taxes, Assessments and Similar Items; Escrow
Accounts...................47
Section 3.08 Access to Certain
Documentation and Information Regarding the Mortgage
Loans..........48
Section 3.09 Permitted
Withdrawals from the Certificate Account and the Distribution
Account...............................................................................48
Section 3.10
Maintenance of Hazard Insurance; Maintenance of Primary Insurance
Policies............49
Section 3.11
Enforcement of Due-On-Sale Clauses; Assumption
Agreements.............................50
Section 3.12
Realization Upon Defaulted Mortgage
Loans.............................................51
Section 3.13 Trustee to
Cooperate; Release of Mortgage
Files.......................................53
Section 3.14 Documents, Records and Funds in
Possession of the Servicer to be Held for the
Trustee...............................................................................54
Section 3.15 Servicing
Compensation................................................................54
Section 3.16 Access to
Certain
Documentation.......................................................55
Section 3.17 Annual
Statement as to
Compliance.....................................................55
Section 3.18 Errors and
Omissions Insurance; Fidelity
Bonds........................................55
Section 3.19
[Reserved]............................................................................56
Section 3.20 Prepayment
Charges....................................................................56
ARTICLE FOUR DISTRIBUTIONS AND ADVANCES BY THE
SERVICER......................................................57
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Section 4.01
Advances..............................................................................57
Section 4.02 Priorities
of
Distribution............................................................58
Section 4.03
[Reserved]............................................................................61
Section 4.04
[Reserved]............................................................................61
Section 4.05 Allocation
of Realized
Losses.........................................................61
Section 4.06 Monthly
Statements to
Certificateholders..............................................62
Section 4.07
[Reserved]............................................................................65
Section 4.08
[Reserved]............................................................................65
Section 4.09
Determination of Pass-Through Rates for LIBOR
Certificates............................65
ARTICLE FIVE THE
CERTIFICATES................................................................................68
Section 5.01 The
Certificates......................................................................68
Section 5.02
Certificate Register; Registration of Transfer and Exchange of
Certificates...........68
Section 5.03 Mutilated,
Destroyed, Lost or Stolen
Certificates.....................................72
Section 5.04 Persons
Deemed
Owners.................................................................72
Section 5.05 Access to
List of Certificateholders' Names and
Addresses.............................73
Section 5.06
Maintenance of Office or
Agency.......................................................73
ARTICLE SIX THE DEPOSITOR AND THE
SERVICER...................................................................74
Section 6.01 Respective
Liabilities of the Depositor and the
Servicer..............................74
Section 6.02 Merger or
Consolidation of the Depositor or the
Servicer..............................74
Section 6.03 Limitation
on Liability of the Depositor, the Seller, the Servicer, and
Others........74
Section 6.04 Limitation
on Resignation of the
Servicer.............................................75
ARTICLE SEVEN
DEFAULT........................................................................................76
Section 7.01 Events of
Default.....................................................................76
Section 7.02 Trustee to
Act; Appointment of
Successor..............................................77
Section 7.03
Notification to
Certificateholders....................................................79
ARTICLE EIGHT CONCERNING THE
TRUSTEE.........................................................................80
Section 8.01 Duties of
the
Trustee.................................................................80
Section 8.02
Certain
Matters Affecting the
Trustee.................................................80
Section 8.03 Trustee
Not Liable for Certificates or Mortgage
Loans.................................82
Section 8.04 Trustee
May Own
Certificates..........................................................82
Section 8.05 Trustee's
Fees and
Expenses...........................................................82
Section 8.06
Eligibility Requirements for the
Trustee..............................................83
Section 8.07
Resignation and Removal of the
Trustee................................................83
Section 8.08 Successor
Trustee.....................................................................84
Section 8.09
Merger or
Consolidation of the
Trustee................................................85
Section 8.10
Appointment of Co-Trustee or Separate
Trustee.........................................85
Section 8.11 Tax
Matters...........................................................................86
ARTICLE NINE
TERMINATION.....................................................................................89
Section 9.01
Termination upon Liquidation or Purchase of the Mortgage
Loans........................89
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Section 9.02 Final
Distribution on the
Certificates................................................89
Section 9.03 Additional
Termination
Requirements...................................................90
ARTICLE TEN MISCELLANEOUS
PROVISIONS.........................................................................92
Section 10.01
Amendment.............................................................................92
Section 10.02 Recordation of
Agreement;
Counterparts................................................93
Section 10.03 Governing
Law.........................................................................94
Section 10.04 Intention of
Parties..................................................................94
Section 10.05 Notices. 94
Section 10.06 Severability of
Provisions............................................................95
Section 10.07
Assignment............................................................................95
Section 10.08 Limitation on
Rights of
Certificateholders............................................95
Section 10.09 Inspection and
Audit
Rights...........................................................96
Section 10.10 Certificates
Nonassessable and Fully
Paid.............................................96
Section 10.11 Official
Record.......................................................................96
Section 10.12 Protection of
Assets..................................................................97
Section 10.13 Qualifying
Special Purpose
Entity.....................................................97
ARTICLE ELEVEN EXCHANGE ACT
REPORTING........................................................................98
Section 11.01 Filing
Obligations....................................................................98
Section 11.02 Form 10-D
Filings.....................................................................98
Section 11.03 Form 8-K
Filings......................................................................99
Section 11.04 Form 10-K
Filings.....................................................................99
Section 11.05 Sarbanes-Oxley
Certification.........................................................100
Section 11.06 Form 15
Filing.......................................................................100
Section 11.07 Report on
Assessment of Compliance and
Attestation...................................100
Section 11.08 Use of
Subcontractors................................................................102
Section 11.09
Amendments...........................................................................102
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SCHEDULES
Schedule I: Mortgage
Loan
Schedule...................................................................S-I-1
Schedule II: Representations
and Warranties of the
Seller/Servicer...................................S-II-1
Schedule III:
Representations and
Warranties as to the Mortgage
Loans................................S-III-1
Schedule IV:
[Reserved]..............................................................................S-IV-1
Schedule V: Form of
Monthly
Report...................................................................S-V-1
EXHIBITS
Exhibit A: Form
of Senior Certificate (other than the Notional Amount
Certificates)...................A-1
Exhibit B:
Form of Subordinated
Certificate...........................................................B-1
Exhibit C: Form
of Class A-R
Certificate..............................................................C-1
Exhibit D: Form
of Notional Amount
Certificate........................................................D-1
Exhibit E: Form
of Reverse of
Certificates............................................................E-1
Exhibit F: Form
of Class P
Certificates...............................................................F-1
Exhibit G-1: Form of Initial
Certification of Trustee
................................................G-1-1
Exhibit G-2: Form of Delay
Delivery
Certification.....................................................G-2-1
Exhibit H: Form
of Final Certification of
Trustee.....................................................H-1
Exhibit I: Form
of Transfer
Affidavit.................................................................I-1
Exhibit J: Form
of Transferor
Certificate.............................................................J-1
Exhibit K: Form
of Investment Letter (Non-Rule
144A)..................................................K-1
Exhibit L: Form
of Rule 144A
Letter...................................................................L-1
Exhibit M: Form
of Request for Release (for
Trustee)..................................................M-1
Exhibit N:
Request for Release of
Documents...........................................................N-1
Exhibit O:
[Reserved].................................................................................O-1
Exhibit P:
[Reserved].................................................................................P-1
Exhibit Q
[Reserved].................................................................................Q-1
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Exhibit R: Form
of Performance Certification
(Trustee)................................................R-1
Exhibit S:
Compliance
Statement.......................................................................S-1
Exhibit T: List
of 1119
Parties.......................................................................T-1
Exhibit U: Form
of Sarbanes-Oxley Certification (Replacement of
Servicer).............................U-1
</TABLE>
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<PAGE>
THIS
POOLING AND SERVICING AGREEMENT, dated as of October 1, 2006,
among
INDYMAC MBS, INC., a Delaware corporation, as depositor (the
"Depositor"),
IndyMac Bank, F.S.B. ("IndyMac"), a federal savings bank, as seller
(in that
capacity, the "Seller") and as Servicer (in that capacity, the
"Servicer"),
and Deutsche Bank National Trust Company, a national banking
association, as
trustee (the "Trustee"),
W I T N E S S E T H T
H A T
In
consideration of the mutual agreements set forth in this
Agreement,
the parties agree as follows:
P R E L I M I N A R Y
S T A T E M E N T
The
Depositor is the owner of the Trust Fund that is hereby conveyed
to
the Trustee in return for the Certificates. The Trust Fund
(exclusive of any
amounts in respect of waived Prepayment Charges paid by the
Servicer to the
Class P Certificates pursuant to the second paragraph of Section
3.20) for
federal income tax purposes will consist of one REMIC (the "Master
REMIC").
Each Certificate, other than the Class A-R Certificate, will
represent
ownership of one or more regular interests in the Master REMIC for
purposes of
the REMIC Provisions. The Class A-R Certificate represents
ownership of the
sole class of residual interest in the Master REMIC. The Master
REMIC will
hold as assets all property of the Trust Fund. For federal income
tax
purposes, each Certificate (other than the Class A-R Certificate)
is hereby
designated as a regular interest in the Master REMIC. The latest
possible
maturity date of all REMIC regular interests created in this
Agreement shall
be the Latest Possible Maturity Date.
All
amounts in respect of waived Prepayment Charges paid by the
Servicer
to the Class P Certificates pursuant to the second paragraph of
Section 3.20
will be treated as paid directly by the Servicer to the Class P
Certificates
and not as paid by or through any REMIC created hereunder.
The Master REMIC
The
following table sets forth characteristics of the Certificates,
together with the minimum denominations and integral multiples in
excess
thereof in which such Classes shall be issuable (except that one
Certificate
of each Class of Certificates may be issued in a different
amount):
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Integral
Initial Class
Minimum
Multiples in
Class Designation
Certificate Balance
Pass-Through Rate
Denomination Excess of
Minimum
----------------------------- --------------------------
-------------------- -------------------- -------------------
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Class A-1
$377,768,000
6.25%
$
[25,000
$1,000
----------------------------- --------------------------
-------------------- -------------------- -------------------
Class A-X
Notional (2)
6.50%
$ 25,000(3)
$1,000(3)
----------------------------- --------------------------
-------------------- -------------------- -------------------
Class A-R
$100
6.25%
$
100
N/A
----------------------------- --------------------------
-------------------- -------------------- -------------------
Class PO
$1,215,534
N/A(1)
$ 25,000
$1,000
----------------------------- --------------------------
-------------------- -------------------- -------------------
Class B-1
$8,645,000
6.25%
$ 25,000
$1,000
----------------------------- --------------------------
-------------------- -------------------- -------------------
Class B-2
$4,825,000
6.25%
$ 25,000
$1,000
----------------------------- --------------------------
-------------------- -------------------- -------------------
Class B-3
$2,815,000
6.25%
$ 25,000
$1,000
----------------------------- --------------------------
-------------------- -------------------- -------------------
Class B-4
$3,016,000
6.25%
$
100,000
$1,000
----------------------------- --------------------------
-------------------- -------------------- -------------------
Class B-5
$2,211,000
6.25%
$
100,000
$1,000
----------------------------- --------------------------
-------------------- -------------------- -------------------
Class B-6
$1,609,180
6.25%
$
100,000]
$1,000
----------------------------- --------------------------
-------------------- -------------------- -------------------
Class P
$100
N/A(4)
$
100
N/A
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(1) The Class PO
Certificates are Principal Only Certificates and are not
entitled to receive distributions of interest.
(2) The Class A-X
Certificates will be Notional Amount Certificates, will
have
no Class Certificate Balance and will bear interest on its
Notional
Amount, which will be $36,653,203 for the initial Interest
Accrual
Period. For federal income tax purposes, the Class A-X Certificate
will
be
entitled to an amount equal to the excess of (i) the Adjusted
Net
Mortgage Rate of each Non-Discount Mortgage Loan over (ii) the
Required
Coupon.
(3) Denomination is
based on Notional Amount.
(4) The Class P
Certificate will not be entitled to any interest, but will be
entitled to 100% of any Prepayment Charges paid on the Mortgage
Loans.
The
foregoing REMIC structure is intended to cause all of the cash
from
the Mortgage Loans to flow through to the Master REMIC as cash flow
on a REMIC
regular interest, without creating any shortfall--actual or
potential (other
than for credit losses) to any REMIC regular interest.
Scheduled Principal Prepayments and Realized Losses will be
allocated to
the Lower Tier REMIC Regular Interests in the same manner as such
amounts are
allocated to the Master REMIC Classes referenced under the column
titled
"Allocation of Principal."
Set forth below are designations of Classes of Certificates to the
categories
used herein:
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Accretion Directed Certificates..........................
None.
Accrual Certificates.....................................
None
Book-Entry Certificates..................................
All
Classes of Certificates other than the Physical
Certificates.
COFI Certificates........................................
None.
Delay Certificates.......................................
All
interest-bearing Classes of Certificates other
than any Non-Delay Certificates.
ERISA-Restricted Certificates............................
The
Residual Certificates and the Private
Certificates; the Retained Certificates until they
have been the subject of an ERISA-Qualifying
Underwriting; and Certificates of any Class that
ceases to have a rating of BBB- (or its equivalent)
or better from at least one Rating Agency.
LIBOR Certificates.......................................
None.
Non-Delay Certificates...................................
LIBOR Certificates.
Notional Amount Certificates.............................
Class A-X Certificates.
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Offered Certificates.....................................
All
Classes of Certificates other than the Private
Certificates.
Physical Certificates....................................
Class A-R Certificates.
Planned Principal Classes................................
None.
Principal Only Certificates..............................
Class PO Certificates.
Private Certificates.....................................
Class P, Class B-4, Class B-5 and Class B-6
Certificates.
Rating Agencies..........................................
S&P & Fitch.
Regular Certificates.....................................
All
Classes of Certificates other than the Class A-R
Certificates.
Residual Certificate.....................................
Class A-R Certificates.
Retained Certificates....................................
Class A-X Certificates.
Senior Certificates......................................
Class A-1, Class A-X, Class PO and Class A-R
Certificates
Subordinated Certificates................................
Class B-1, Class B-2, Class B-3, Class B-4, Class
B-5 and Class B-6 Certificates.
Targeted Principal Classes...............................
None.
Targeted Principal Component.............................
None.
</TABLE>
With
respect to any of the foregoing designations as to which the
corresponding reference is "None," all defined terms and provisions
in this
Agreement relating solely to such designations shall be of no force
or effect,
and any calculations in this Agreement incorporating references to
such
designations shall be interpreted without reference to such
designations and
amounts. Defined terms and provisions in this Agreement relating
to
statistical rating agencies not designated above as Rating Agencies
shall be
of no force or effect.
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<PAGE>
ARTICLE ONE
DEFINITIONS
Section 1.01 Definitions.
Unless the context requires a different meaning, capitalized terms
are
used in this Agreement as defined below.
Accretion Directed Certificates: As specified in the
Preliminary
Statement.
Accretion Direction Rule: Not applicable.
Accrual Amount: Not applicable.
Accrual Certificates: As specified in the Preliminary
Statement.
Accrual Termination Date: Not applicable.
Additional Designated Information: As defined in Section 11.02.
Adjusted Mortgage Rate: As to each Mortgage Loan and at any time,
the per
annum rate equal to the Mortgage Rate less the Servicing Fee
Rate.
Adjusted Net Mortgage Rate: As to each Mortgage Loan and any
Distribution
Date, the per annum rate equal to the Mortgage Rate of that
Mortgage Loan (as
of the Due Date in the month preceding the month in which such
Distribution
Date occurs) less the Expense Fee Rate for that Mortgage Loan.
Adjustment Date: Not applicable.
Advance: The payment required to be made by the Servicer with
respect to
any Distribution Date pursuant to Section 4.01, the amount of any
such payment
being equal to the aggregate of payments of principal and interest
(net of the
Servicing Fee) on the Mortgage Loans that were due during the
related Due
Period and not received as of the close of business on the
related
Determination Date, together with an amount equivalent to interest
on each REO
Property, net of any net income from such REO Property, less the
aggregate
amount of any such delinquent payments that the Servicer has
determined would
constitute a Nonrecoverable Advance if advanced.
Advance Notice: As defined in Section 4.01(b).
Advance Deficiency: As defined in Section 4.01(b).
Affiliate: With respect to any Person, any other Person
controlling,
controlled or under common control with such Person. For purposes
of this
definition, "control" means the power to direct the management and
policies of
a Person, directly or indirectly, whether through ownership of
voting
securities, by contract, or otherwise and "controlling" and
"controlled" shall
have meanings correlative to the foregoing. Affiliates also include
any
entities consolidated with the requirements of generally accepted
accounting
principles.
Agreement: This Pooling and Servicing Agreement and all amendments
and
supplements.
4
<PAGE>
Allocable Share: As to any Distribution Date and any Mortgage Loan
(i)
[reserved]; (ii) with respect to the Class PO Certificates, zero
and (iii)
with respect to each other Class of Certificates the product of (a)
the lesser
of (I) the ratio that the Required Coupon bears to such Adjusted
Net Mortgage
Rate of such Mortgage Loan and (II) one, multiplied by (b) the
ratio that the
amount calculated with respect to such Distribution Date for such
Class,
pursuant to clause (i) of the definition of Class Optimal
Interest
Distribution Amount (without giving effect to any reduction of such
amount
pursuant to Section 4.02(d)) bears to the aggregate amount
calculated with
respect to such Distribution Date for each such Class of
Certificates pursuant
to clause (i) of the definition of Class Optimal Interest
Distribution Amount
(without giving effect to any reduction of such amounts pursuant to
Section
4.02(d)).
Amount Available for Senior Principal: As to any Distribution Date,
the
Available Funds for such Distribution Date, reduced by the
aggregate amount
distributable (or allocable to the Accrual Amount, if applicable)
on such
Distribution Date in respect of interest on the Senior Certificates
pursuant
to Section 4.02(a)(1)(iii).
Amount Held for Future Distribution: As to any Distribution Date,
the
aggregate amount held in the Certificate Account at the close of
business on
the related Determination Date on account of (i) Principal
Prepayments
received after the last day of the related Prepayment Period and
Liquidation
Proceeds and Subsequent Recoveries received in the month of such
Distribution
Date and (ii) all Scheduled Payments due after the related Due
Date.
Applicable Credit Support Percentage: As defined in Section
4.02(e).
Appraised Value: With respect to any Mortgage Loan, the Appraised
Value
of the related Mortgaged Property shall be: (i) with respect to a
Mortgage
Loan other than a Refinance Loan, the lesser of (a) the value of
the Mortgaged
Property based upon the appraisal made at the time of the
origination of such
Mortgage Loan and (b) the sales price of the Mortgaged Property at
the time of
the origination of such Mortgage Loan; and (ii) with respect to a
Refinance
Loan, the value of the Mortgaged Property based upon the appraisal
made at the
time of the origination of such Refinance Loan.
Available Funds: As to any Distribution, the sum of (a) the
aggregate
amount held in the Certificate Account at the close of business on
the related
Determination Date, including any Subsequent Recoveries, net of the
Amount
Held for Future Distribution, net of Prepayment Charges and net of
amounts
permitted to be withdrawn from the Certificate Account pursuant to
clauses (i)
- (viii), inclusive, of Section 3.09(a) and amounts permitted to be
withdrawn
from the Distribution Account pursuant to clauses (i) - (ii),
inclusive, of
Section 3.09(b), (b) the amount of the Advances for that
Distribution Date,
(c) in connection with Defective Mortgage Loans, the aggregate of
the Purchase
Prices and Substitution Adjustment Amounts deposited on the
related
Distribution Account Deposit Date, and (d) any amount deposited on
the related
Distribution Account Deposit Date pursuant to Section 3.10. The
Holders of the
Class P Certificates will be entitled to all Prepayment Charges
received on
the Mortgage Loans and such amounts will not be available for
distribution to
the Holders of any other Class of Certificates.
Bankruptcy Code: The United States Bankruptcy Reform Act of 1978,
as
amended.
Bankruptcy Coverage Termination Date: The point in time at which
the
Bankruptcy Loss Coverage Amount is reduced to zero.
Bankruptcy Loss: With respect to any Mortgage Loan, a Deficient
Valuation
or Debt Service Reduction; provided, however, that a Bankruptcy
Loss shall not
be deemed a Bankruptcy Loss under this Agreement so long as the
Servicer has
notified the Trustee in writing that the Servicer is diligently
pursuing any
remedies that may exist in connection with the related Mortgage
Loan and
either (A) the
5
<PAGE>
related Mortgage Loan is not in default with regard to payments due
under the
Mortgage Loan or (B) delinquent payments of principal and interest
under the
related Mortgage Loan and any related escrow payments in respect of
such
Mortgage Loan are being advanced on a current basis by the
Servicer, in either
case without giving effect to any Debt Service Reduction or
Deficient
Valuation.
Bankruptcy Loss Coverage Amount: As of any date of determination,
the
Bankruptcy Loss Coverage Amount shall equal the Initial Bankruptcy
Loss
Coverage Amount as reduced by (i) the aggregate amount of
Bankruptcy Losses
allocated to the Certificates since the Cut-off Date and (ii) any
permissible
reductions in the Bankruptcy Loss Coverage Amount as evidenced by a
letter of
each Rating Agency to the Trustee to the effect that any such
reduction will
not result in a downgrading, qualification or withdrawal of the
then current
ratings assigned to the Classes of Certificates rated by it.
Blanket Mortgage: The mortgage or mortgages encumbering a
Cooperative
Property.
Book-Entry Certificates: As specified in the Preliminary
Statement.
Business Day: Any day other than (i) a Saturday or a Sunday, or
(ii) a
day on which banking institutions in the City of New York, New
York, the State
of California or the city in which the Corporate Trust Office of
the Trustee
is located are authorized or obligated by law or executive order to
be closed.
Certificate: Any one of the certificates issued by the Trust Fund
and
executed by the Trustee in substantially the forms attached as
exhibits.
Certificate Account: The separate Eligible Account or Accounts
created
and maintained by the Servicer pursuant to Section 3.06(d) with a
depository
institution in the name of the Servicer for the benefit of the
Trustee on
behalf of Certificateholders and designated "IndyMac Bank, F.S.B.,
in trust
for the registered holders of Residential Asset Securitization
Trust 2006-A13,
Mortgage Pass-Through Certificates, Series 2006-M."
Certificate Balance: With respect to any Certificate (other than
the
Notional Amount Certificates) at any date of determination, the
maximum dollar
amount of principal to which the Holder thereof is then entitled
under this
Agreement, such amount being equal to the Denomination thereof (A)
plus any
increase in the Certificate Balance of such Certificate pursuant to
Section
4.02 due to the receipt of Subsequent Recoveries, (B) minus the sum
of (i) all
distributions of principal previously made with respect thereto and
(ii) all
Realized Losses allocated to that Certificate and, in the case of
any
Subordinated Certificates, all other reductions in Certificate
Balance
previously allocated to that Certificate pursuant to Section 4.05
and (C) in
the case of any Class of Accrual Certificates, plus the Accrual
Amount added
to the Class Certificate Balance of such Class prior to such date.
The
Notional Amount Certificates do not have Certificate Balances.
Certificate Group: Not applicable.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person
who is the beneficial owner of the Book-Entry Certificate. For the
purposes of
this Agreement, in order for a Certificate Owner to enforce any of
its rights
under this Agreement, it shall first have to provide evidence of
its
beneficial ownership interest in a Certificate that is reasonably
satisfactory
to the Trustee, the Depositor and/or the Servicer, as
applicable.
Certificate Register: The register maintained pursuant to Section
5.02.
6
<PAGE>
Certificate Registrar: Deutsche Bank National Trust Company and
its
successors and, if a successor trustee is appointed under this
Agreement, the
successor.
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 is not
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 a consent has been obtained, except that if the Depositor
or its
affiliates own 100% of the Percentage Interests evidenced by a
Class of
Certificates, the Certificates shall be Outstanding for purposes of
any
provision of this Agreement requiring the consent of the Holders
of
Certificates of a particular Class as a condition to the taking of
any action.
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 Party: As defined in Section 11.05.
Certifying Person: As defined in Section 11.05.
Class: All Certificates bearing the same class designation as set
forth
in the Preliminary Statement.
Class Certificate Balance: For any Class as of any date of
determination,
the aggregate of the Certificate Balances of all Certificates of
the Class as
of that date.
Class Interest Shortfall: As to any Distribution Date and Class,
the
amount by which the amount described in clause (i) of the
definition of Class
Optimal Interest Distribution Amount for such Class exceeds the
amount of
interest actually distributed on such Class on such Distribution
Date pursuant
to such clause (i).
Class Optimal Interest Distribution Amount: With respect to any
Distribution Date and interest-bearing Class, the sum of (i) one
month's
interest accrued during the related Interest Accrual Period at
the
Pass-Through Rate for such Class, on the related Class Certificate
Balance or
Notional Amount, as applicable, immediately prior to such
Distribution Date,
subject to reduction pursuant to Section 4.02(d), and (ii) any
Class Unpaid
Interest Amounts for such Class.
Class PO Deferred Amount: As to any Distribution Date, the
aggregate of
the applicable PO Percentage of each Realized Loss, other than any
Excess
Loss, on a Discount Mortgage Loan to be allocated to the Class PO
Certificates
on such Distribution Date on or prior to the Senior Credit Support
Depletion
Date or previously allocated to that Class PO Certificates and not
yet paid to
the Holders of the Class PO Certificates.
Class Subordination Percentage: With respect to any Distribution
Date and
each Class of Subordinated Certificates, the fraction (expressed as
a
percentage) the numerator of which is the Class Certificate Balance
of such
Class of Subordinated Certificates immediately prior to such
Distribution Date
and the denominator of which is the aggregate Class Certificate
Balance of all
Classes of Certificates immediately prior to such Distribution
Date.
Class Unpaid Interest Amounts: As to any Distribution Date and
Class of
interest-bearing Certificates, the amount by which the aggregate
Class
Interest Shortfalls for such Class on prior Distribution Dates
exceeds the
amount distributed on such Class on prior Distribution Dates
pursuant to
clause (ii) of the definition of Class Optimal Interest
Distribution Amount.
7
<PAGE>
Closing Date: October 27, 2006.
Code: The Internal Revenue Code of 1986, including any successor
or
amendatory provisions. COFI: Not applicable.
COFI
Certificates: Not applicable.
Commission: The United States Securities and Exchange
Commission.
Compensating Interest: For any Distribution Date, 0.125% multiplied
by
one-twelfth multiplied by the aggregate Stated Principal Balance of
the
Mortgage Loans as of the first day of the prior month.
Component: As specified in the Preliminary Statement.
Component Balance: With respect to any Component and any
Distribution
Date, its Initial Component Balance (A) plus any Subsequent
Recoveries added
to the Component Balance of such Component pursuant to Section
4.02, (B) minus
the sum of all amounts applied in reduction of the principal
balance of such
Component and Realized Losses allocated thereto and increased due
to the
receipt of Subsequent Recoveries.
Component Certificates: As specified in the Preliminary
Statement.
Co-op Shares: Shares issued by a Cooperative Corporation.
Cooperative Corporation: The entity that holds title (fee or an
acceptable leasehold estate) to the real property and
improvements
constituting the Cooperative Property and that governs the
Cooperative
Property, which Cooperative Corporation must qualify as a
Cooperative Housing
Corporation under section 216 of the Code.
Cooperative Loan: Any Mortgage Loan secured by Co-op Shares and
a
Proprietary Lease.
Cooperative Property: The real property and improvements owned by
the
Cooperative Corporation, including the allocation of individual
dwelling units
to the holders of the Co-op Shares of the Cooperative
Corporation.
Cooperative Unit: A single family dwelling located in a
Cooperative
Property.
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, Attn: Mortgage Administration-IN0613
(IndyMac
MBS, Inc., Residential Asset Securitization Trust 2006-A13,
Mortgage
Pass-Through Certificates, Series 2006-M), and which is the address
to which
notices to and correspondence with the Trustee should be directed.
With
respect to the Certificate Registrar and presentment of
Certificates for
registration or transfer, exchange or final payment, the Corporate
Trust
Office is located at DB Services Tennessee, 648 Grassmere Park
Road,
Nashville, Tennessee 37211-3658, Attention: Transfer Unit.
Cut-off Date: October 1, 2006.
Cut-off Date Pool Principal Balance: $402,104,815.33.
8
<PAGE>
Cut-off Date Principal Balance: As to any Mortgage Loan, its
Stated
Principal Balance as of the close of business on the Cut-off
Date.
Debt
Service Reduction: For any Mortgage Loan, a reduction by a court
of
competent jurisdiction in a proceeding under the Bankruptcy Code in
the
Scheduled Payment for the Mortgage Loan that became final and
non-appealable,
except a reduction resulting from a Deficient Valuation or a
reduction that
results in a permanent forgiveness of principal.
Defective Mortgage Loan: Any Mortgage Loan that is required to
be
repurchased pursuant to Section 2.02 or 2.03.
Deficient Valuation: For any Mortgage Loan, a valuation by a court
of
competent jurisdiction of the Mortgaged Property in an amount less
than the
then outstanding indebtedness under the Mortgage Loan, or any
reduction in the
amount of principal to be paid in connection with any Scheduled
Payment that
results in a permanent forgiveness of principal, which valuation or
reduction
results from an order of the court that is final and non-appealable
in a
proceeding under the 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.
Delay Delivery Certification: A certification substantially in the
form
of Exhibit G-2.
Delay Delivery Mortgage Loans: The Mortgage Loans identified on
the
Mortgage Loan Schedule for which none of a related Mortgage File or
neither
the Mortgage Note nor a lost note affidavit for a lost Mortgage
Note has been
delivered to the Trustee by the Closing Date. The Depositor shall
deliver the
Mortgage Files to the Trustee:
(A)
for at least 70% of the Mortgage Loans, not later than the
Closing
Date, and
(B)
for the remaining 30% of the Mortgage Loans, not later than
five
Business Days following the Closing Date.
To
the extent that the Seller is in possession of any Mortgage File
for
any Delay Delivery Mortgage Loan, until delivery of the Mortgage
File to the
Trustee as provided in Section 2.01, the Seller shall hold the
files as
Servicer, as agent and in trust for the Trustee.
Deleted Mortgage Loan: As defined in Section 2.03(c).
Delinquent: A Mortgage Loan is "Delinquent" if any monthly payment
due on
a Due Date is not made by the close of business on the next
scheduled Due Date
for such Mortgage Loan. A Mortgage Loan is "30 days Delinquent" if
such
monthly payment has not been received by the close of business on
the
corresponding day of the month immediately succeeding the month in
which such
monthly payment was due. The determination of whether a Mortgage
Loan is "60
days Delinquent", "90 days Delinquent", etc. shall be made in a
like manner.
Denomination: For each Certificate, the amount on the face of
the
Certificate as the "Initial Certificate Balance of this
Certificate" or the
"Initial Notional Amount of this Certificate" or, if neither of the
foregoing,
the Percentage Interest appearing on the face of the
Certificate.
9
<PAGE>
Depositor: IndyMac MBS, Inc., a Delaware corporation, or its
successor 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 UCC.
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.
Derivative Notional Balance: For each Distribution Date prior to
the
Termination Date, the amount described in Schedule 1 to the
Prospectus
Supplement. After the Termination Date, the Derivative Notional
Balance will
be equal to zero.
Determination Date: As to any Distribution Date, the 18th day of
each
month or if that day is not a Business Day the next Business Day,
except that
if the next Business Day is less than two Business Days before the
related
Distribution Date, then the Determination Date shall be the
Business Day
preceding the 18th day of the month.
Discount Mortgage Loan: Any Mortgage Loan with an Adjusted Net
Mortgage
Rate that is less than the Required Coupon.
Distribution Account: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 3.06(e) 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
Residential
Asset Securitization Trust 2006-A13, Mortgage Pass-Through
Certificates,
Series 2006-M." Funds in the Distribution Account shall be held in
trust for
the Certificateholders for the uses and purposes set forth in this
Agreement.
Distribution Account Deposit Date: As to any Distribution Date,
12:30
P.M. Pacific time on the Business Day preceding the Distribution
Date.
Distribution Date: The 25th day of each calendar month after the
initial
issuance of the Certificates, or if that day is not a Business Day,
the next
Business Day, commencing in November 2006.
Due
Date: For any Mortgage Loan and Distribution Date, the first day
of
the month in which such Distribution Date occurs.
Due
Period: For any Distribution Date, the period commencing on the
second day of the month preceding the month in which the
Distribution Date
occurs and ending on the first day of the month in which the
Distribution Date
occurs.
EDGAR: The Commission's Electronic Data Gathering, Analysis and
Retrieval
System.
Eligible Account: Any of
(i) an account or accounts
maintained with a federal or state chartered
depository institution or trust company the short-term unsecured
debt
obligations of which (or, in the case of a depository institution
or trust
company that is the principal subsidiary of a holding company, the
debt
obligations of such holding company) have the highest short-term
ratings of
Moody's or Fitch and one of the two highest
10
<PAGE>
short-term ratings of S&P, if S&P is a Rating Agency at the
time any amounts
are held on deposit therein, or
(ii)
an account or accounts in a depository institution or trust
company
in which such accounts are insured by the FDIC (to the limits
established by
the FDIC) and the uninsured deposits in which accounts are
otherwise secured
such that, as evidenced by an Opinion of Counsel delivered to the
Trustee and
to each Rating Agency, the Certificateholders have a claim with
respect to the
funds in such account or a perfected first priority security
interest against
any collateral (which shall be limited to Permitted Investments)
securing such
funds that is superior to claims of any other depositors or
creditors of the
depository institution or trust company in which such account is
maintained,
or
(iii) a trust account or
accounts maintained with (a) the trust
department of a federal or state chartered depository institution
or (b) a
trust company, acting in its fiduciary capacity or
(iv)
any other account acceptable to each Rating Agency..
Eligible Accounts may bear interest, and may include, if otherwise
qualified
under this definition, accounts maintained with the Trustee.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA-Qualifying Underwriting: A best efforts or firm
commitment
underwriting or private placement that meets the requirements of
the
Underwriter's Exemption.
ERISA-Restricted Certificate: As specified in the Preliminary
Statement.
Escrow Account: The Eligible Account or Accounts established
and
maintained pursuant to Section 3.07(a).
Event of Default: As defined in Section 7.01.
Excess Loss: The amount of any (i) Fraud Loss on the Mortgage
Loans
realized after the Fraud Loss Coverage Termination Date, (ii)
Special Hazard
Loss on the Mortgage Loans realized after the Special Hazard
Coverage
Termination Date or (iii) Bankruptcy Loss on the Mortgage Loans
realized after
the Bankruptcy Coverage Termination Date.
Excess Proceeds: For any Liquidated Mortgage Loan, the excess
of
(a)
all Liquidation Proceeds from the Mortgage Loan received in the
calendar month in which the Mortgage Loan became a Liquidated
Mortgage Loan,
net of any amounts previously reimbursed to the Servicer as
Nonrecoverable
Advances with respect to the Mortgage Loan pursuant to Section
3.09(a)(iii),
over
(b)
the sum of (i) the unpaid principal balance of the Liquidated
Mortgage Loan as of the Due Date in the month in which the Mortgage
Loan
became a Liquidated Mortgage Loan plus (ii) accrued interest at the
Mortgage
Rate from the Due Date for which interest was last paid or advanced
(and not
reimbursed) to Certificateholders up to the Due Date applicable to
the
Distribution Date following the calendar month during which the
liquidation
occurred.
Exchange Act: The Securities Exchange Act of 1934, as amended, and
the
rules and regulations promulgated thereunder.
11
<PAGE>
Exchange Act Reports: Any reports on Form 10-D, Form 8-K and Form
10-K
required to be filed by the Depositor with respect to the Trust
Fund under the
Exchange Act.
Expense Fee Rate: As to each Mortgage Loan, the sum of (a) the
related
Servicing Fee Rate and (b) the Trustee Fee Rate.
FDIC: The Federal Deposit Insurance Corporation, or any
successor
thereto.
FHLMC: 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, or any
successor thereto.
Fitch: Fitch, Inc., or any successor thereto. 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, NY 10004, Attention: MBS Monitoring - IndyMac 2006-M, or
any other
address Fitch furnishes to the Depositor and the Servicer.
FNMA: The Federal National Mortgage Association, a federally
chartered
and privately owned corporation organized and existing under the
Federal
National Mortgage Association Charter Act, or any successor
thereto.
Form
10-D Disclosure Item: With respect to any Person, any material
litigation or governmental proceedings pending against such Person,
or against
any of the Trust Fund, the Depositor, the Trustee or the Servicer,
if such
Person has actual knowledge thereof.
Form
10-K Disclosure Item: With respect to any Person, (a) Form 10-D
Disclosure Item, and (b) any affiliations or relationships between
such Person
and any Item 1119 Party.
Fraud Loan: A Liquidated Mortgage Loan as to which a Fraud Loss
has
occurred.
Fraud Loss Coverage Amount: As of the Closing Date,
$8,042,096.31,
subject to reduction from time to time, by the amount of Fraud
Losses
allocated to the Certificates. In addition, on each anniversary of
the Cut-off
Date, the Fraud Loss Coverage Amount will be reduced as follows:
(a) on the
first, second, third and fourth anniversaries of the Cut-off Date,
to an
amount equal to the lesser of (i) 1% of the then-current Stated
Principal
Balance of the Mortgage Loans in the case of the first, second,
third and
fourth such anniversaries and (ii) the excess of the Fraud Loss
Coverage
Amount as of the preceding anniversary of the Cut-off Date over the
cumulative
amount of Fraud Losses allocated to the Certificates since such
preceding
anniversary; and (b) on the fifth anniversary of the Cut-off Date,
to zero.
Fraud Loss Coverage Termination Date: The point in time at which
the
Fraud Loss Coverage Amount is reduced to zero.
Fraud Losses: Realized Losses on Mortgage Loans as to which a loss
is
sustained by reason of a default arising from fraud, dishonesty
or
misrepresentation in connection with the related Mortgage Loan,
including a
loss by reason of the denial of coverage under any related Primary
Insurance
Policy because of such fraud, dishonesty or misrepresentation.
Indirect Participant: A broker, dealer, bank, or other
financial
institution or other Person that clears through or maintains a
custodial
relationship with a Depository Participant.
Initial Bankruptcy Loss Coverage Amount: $142,671.91.
12
<PAGE>
Initial Component Balance: As specified in the Preliminary
Statement.
Initial LIBOR Rate: Not
applicable.
Insurance Policy: For 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: Proceeds paid by an insurer pursuant to any
Insurance
Policy, in each case other than any amount included in such
Insurance Proceeds
in respect of Insured Expenses.
Insured Expenses: Expenses covered by an Insurance Policy or any
other
insurance policy with respect to the Mortgage Loans.
Interest Accrual Period: With respect to each Class of Delay
Certificates
and any Distribution Date, the calendar month prior to the month of
such
Distribution Date. With respect to each Class of Non-Delay
Certificates and
any Distribution Date, the one-month period commencing on the 25th
day of the
month preceding the month in which such Distribution Date occurs
and ending on
the 24th day of the month in which such Distribution Date occurs.
All Classes
of Certificates will accrue interest on the basis of a 360-day year
consisting
of twelve 30-day months.
Interest Determination Date: With respect to (a) any Interest
Accrual
Period for any LIBOR Certificates and (b) any Interest Accrual
Period for the
COFI Certificates for which the applicable Index is LIBOR, the
second Business
Day prior to the first day of such Interest Accrual Period.
Interest Settlement Rate: As defined in Section 4.09.
Item
1119 Party: The Depositor, the Seller, the Servicer, the Trustee
and
any other material transaction party, as identified in Exhibit T,
as updated
pursuant to Section 11.04.
Last
Scheduled Distribution Date: The Distribution Date in the month
immediately following the month of the latest scheduled maturity
date for any
of the Mortgage Loans.
Latest Possible Maturity Date: The Distribution Date following the
third
anniversary of the scheduled maturity date of the Mortgage Loan
having the
latest scheduled maturity date as of the Cut-off Date.
Lender PMI Loans: Mortgage Loans with respect to which the lender
rather
than the borrower acquired the primary mortgage guaranty insurance
and charged
the related borrower an interest premium.
LIBOR: The London interbank offered rate for one month United
States
dollar deposits calculated in the manner described in Section
4.09.
LIBOR Certificates: As specified in the Preliminary Statement.
LIBOR Determination Date: For any Interest Accrual Period, the
second
London Business Day prior to the commencement of such Interest
Accrual Period.
Limited Exchange Act Reporting Obligations: The obligations of
the
Servicer under Section 3.17(b), Section 6.02 and Section 6.04 with
respect to
notice and information to be provided to the Depositor and Article
11 (except
Section 11.07(a)(i) and (ii)).
13
<PAGE>
Liquidated Mortgage Loan: For any Distribution Date, a defaulted
Mortgage
Loan (including any REO Property) that was liquidated in the
calendar month
preceding the month of the Distribution Date and as to which the
Servicer has
certified (in accordance with this Agreement) that it has received
all amounts
it expects to receive in connection with the liquidation of the
Mortgage Loan,
including the final disposition of an REO Property.
Liquidation Proceeds: Amounts, including Insurance Proceeds
regardless of
when received, received in connection with the partial or complete
liquidation
of defaulted Mortgage Loans, whether through trustee's sale,
foreclosure sale,
or otherwise or amounts received in connection with any
condemnation or
partial release of a Mortgaged Property, and any other proceeds
received in
connection with an REO Property, less the sum of related
unreimbursed
Servicing Fees, Servicing Advances, and Advances.
Loan-to-Value Ratio: For any Mortgage Loan and as of any date
of
determination, is the fraction whose numerator is the original
principal
balance of the related Mortgage Loan at that date of determination
and whose
denominator is the Appraised Value of the related Mortgaged
Property.
London Business Day: Any day on which dealings in deposits of
United
States dollars are transacted in the London interbank market.
Lost
Mortgage Note: Any Mortgage Note the original of which was
permanently lost or destroyed and has not been replaced.
Maintenance: For any Cooperative Unit, the rent paid by the
Mortgagor to
the Cooperative Corporation pursuant to the Proprietary Lease.
MERS: Mortgage Electronic Registration Systems, Inc., a
corporation
organized and existing under the laws of the State of Delaware, or
any
successor thereto.
MERS
Mortgage Loan: Any Mortgage Loan registered with MERS on the
MERS(R)
System.
MERS(R) System: The system of recording transfers of mortgages
electronically maintained by MERS.
MIN:
The mortgage identification number for any MERS Mortgage Loan.
MOM
Loan: Any Mortgage Loan as to which MERS is acting as
mortgagee,
solely as nominee for the originator of such Mortgage Loan and its
successors
and assigns.
Moneyline Telerate Page 3750: The display page currently so
designated on
the Moneyline Telerate Information Services, Inc. (or any page
replacing that
page on that service for the purpose of displaying London
inter-bank offered
rates of major banks).
Monthly Statement: The statement delivered to the
Certificateholders
pursuant to Section 4.06.
Moody's: Moody's Investors Service, Inc., or any successor thereto.
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 Loan Monitoring Group, or any other address
that
Moody's furnishes to the Depositor and the Servicer.
14
<PAGE>
Mortgage: The mortgage, deed of trust, or other instrument creating
a
first lien on an estate in fee simple or leasehold interest in real
property
securing a Mortgage Note.
Mortgage File: The mortgage documents listed in Section 2.01
pertaining
to a particular Mortgage Loan and any additional documents
delivered to the
Trustee to be added to the Mortgage File pursuant to this
Agreement.
Mortgage Loans: Such of the mortgage loans transferred and assigned
to
the Trustee pursuant to this Agreement, as from time to time are
held as a
part of the Trust Fund (including any REO Property), the Mortgage
Loans so
held being identified on the Mortgage Loan Schedule,
notwithstanding
foreclosure or other acquisition of title of the related Mortgaged
Property.
Mortgage Loan Schedule: As of any date, the list set forth in
Schedule I
of Mortgage Loans included in the Trust Fund on that date. The
Mortgage Loan
Schedule shall be prepared by the Seller and shall set forth the
following
information with respect to each Mortgage Loan:
(i) the loan
number;
(ii) the street address of the Mortgaged Property, including the
zip
code;
(iii) the maturity date;
(iv) the original principal balance;
(v) the Cut-off Date
Principal Balance;
(vi) the first payment date of the Mortgage Loan;
(vii) the
Scheduled Payment in effect as of the Cut-off Date;
(viii) the Loan-to-Value Ratio at origination;
(ix) a code indicating whether the residential dwelling at the
time
of origination was represented to be owner-occupied;
(x) a code indicating
whether the residential dwelling is either
(a) a detached single family dwelling, (b) a dwelling in a PUD,
(c) a condominium unit, (d) a two- to four-unit residential
property, or (e)
a Cooperative Unit;
(xi) the Mortgage Rate;
(xii) the purpose for the Mortgage Loan;
(xiii) the type of documentation program pursuant to which the
Mortgage Loan was originated;
(xiv) a code indicating whether the Mortgage Loan is a
borrower-paid
mortgage insurance loan;
(xv) the Servicing Fee Rate;
(xvi) a code indicating whether the Mortgage Loan is a Lender
PMI
Loan;
15
<PAGE>
(xvii) the coverage amount of any mortgage insurance;
(xviii) with respect to the Lender PMI Loans, the interest
premium
charged by the lender;
(xix) a code indicating whether the Mortgage Loan is a Delay
Delivery Mortgage Loan; and
(xx) a code indicating whether the Mortgage Loan is a MERS
Mortgage
Loan.
The schedule shall also set forth the total of the amounts
described under (v)
above for all of the Mortgage Loans.
Mortgage Note: The original executed note or other evidence of
the
indebtedness of a Mortgagor under a Mortgage Loan.
Mortgage Rate: The annual rate of interest borne by a Mortgage Note
from
time to time (net of the interest premium for any Lender PMI
Loan).
Mortgaged Property: The underlying property securing a Mortgage
Loan,
which, with respect to a Cooperative Loan, is the related Co-op
Shares and
Proprietary Lease.
Mortgagor: The obligors on a Mortgage Note.
National Cost of Funds Index: The National Monthly Median Cost of
Funds
Ratio to SAIF-Insured Institutions published by the OTS.
Net
Prepayment Interest Shortfall: As to any Distribution Date, the
amount by which the aggregate of Prepayment Interest Shortfalls for
such
Distribution Date exceeds the Compensating Interest for such
Distribution
Date.
Non-Delay Certificates: As specified in the Preliminary
Statement.
Non-Discount Mortgage Loan: As to any Mortgage Loan with an
Adjusted Net
Mortgage Rate that is greater than or equal to the Required
Coupon.
Non-PO Formula Principal Amount: As to any Distribution Date, the
sum of
(i) the applicable Non-PO Percentage of (a) all monthly payments of
principal
due on each Mortgage Loan on the related Due Date, (b) the
principal portion
of the purchase price of each Mortgage Loan that was repurchased by
the Seller
pursuant to this Agreement as of such Distribution Date, excluding
any
Mortgage Loan that was repurchased due to a modification of the
Mortgage Rate,
(c) the Substitution Adjustment Amount in connection with any
Deleted Mortgage
Loan received with respect to such Distribution Date, (d) any
Insurance
Proceeds or Liquidation Proceeds allocable to recoveries of
principal of
Mortgage Loans that are not yet Liquidated Mortgage Loans received
during the
calendar month preceding the month of such Distribution Date, (e)
with respect
to each Mortgage Loan that became a Liquidated Mortgage Loan during
the
calendar month preceding the month of such Distribution Date, the
amount of
Liquidation Proceeds allocable to principal received with respect
to such
Mortgage Loan, and (f) all partial and full Principal Prepayments
received
during the related Prepayment Period and (ii) (A) any Subsequent
Recoveries
received during the calendar month preceding the month of such
Distribution
Date, or (B) with respect to Subsequent Recoveries attributable to
a Discount
Mortgage Loan that incurred (1) an Excess Loss or (2) a Realized
Loss after
the Senior Credit Support Depletion Date, the Non-PO
16
<PAGE>
Percentage of any Subsequent Recoveries received during the
calendar month
preceding the month of such Distribution Date.
Non-PO Percentage: As to any Discount Mortgage Loan, a fraction
(expressed as a percentage) the numerator of which is the Adjusted
Net
Mortgage Rate of such Discount Mortgage Loan and the denominator of
which is
the Required Coupon. As to any Non-Discount Mortgage Loan,
100%.
Nonrecoverable Advance: Any portion of an Advance previously made
or
proposed to be made by the Servicer, that, in the good faith
judgment of the
Servicer, will not be ultimately recoverable by the Servicer from
the related
Mortgagor, related Liquidation Proceeds or otherwise.
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.
Notional Amount: With respect to the Class A-X Certificates and
any
Distribution Date, an amount equal to the product of (i) a
fraction, the
numerator of which is the excess of (a) the weighted average of the
Adjusted
Net Mortgage Rates for the Non-Discount Mortgage Loans as of the
Due Date in
the prior month (after giving effect to Principal Prepayments
received in the
Prepayment Period related to that prior Due Date) over (b) the
Required
Coupon, and the denominator of which is the Required Coupon and
(ii) the
aggregate Stated Principal Balance of the Non-Discount Mortgage
Loans as of
the Due Date in the prior month (after giving effect to Principal
Prepayments
received in the Prepayment Period related to that prior Due
Date).
Notional Amount Certificates: As specified in the Preliminary
Statement.
Offered Certificates: As specified in the Preliminary
Statement.
Officer's Certificate: A certificate (i) signed by the Chairman of
the
Board, the Vice Chairman of the Board, the President, a Managing
Director, a
Vice President (however denominated), an Assistant Vice President,
the
Treasurer, the Secretary, or one of the Assistant Treasurers or
Assistant
Secretaries of the Depositor or the Servicer, or (ii) if provided
for in this
Agreement, signed by a Servicing Officer, as the case may be, and
delivered to
the Depositor and the Trustee as required by this Agreement.
Opinion of Counsel: For the interpretation or application of the
REMIC
Provisions, a written opinion of counsel who (i) is in fact
independent of the
Depositor and the Servicer, (ii) does not have any direct financial
interest
in the Depositor or the Servicer or in any affiliate of either, and
(iii) is
not connected with the Depositor or the Servicer as an officer,
employee,
promoter, underwriter, trustee, partner, director, or person
performing
similar functions. Otherwise, a written opinion of counsel who may
be counsel
for the Depositor or the Servicer, including in-house counsel,
reasonably
acceptable to the Trustee.
Original Applicable Credit Support Percentage: With respect to each
of
the following Classes of Subordinated Certificates, the
corresponding
percentage described below, as of the Closing Date:
Class B-1.................................... 5.75%
Class B-2.................................... 3.60%
Class B-3.................................... 2.40%
Class B-4.................................... 1.70%
Class B-5.................................... 0.95%
Class B-6.................................... 0.40%
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<PAGE>
Original Mortgage Loan: The Mortgage Loan refinanced in connection
with
the origination of a Refinance Loan.
Original Subordinated Principal Balance: The aggregate Class
Certificate
Balance of the Subordinated Certificates as of the Closing Date
OTS:
The Office of Thrift Supervision.
Outside Reference Date: Not applicable.
Outstanding: For 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 that was not the subject
of a
Principal Prepayment in Full before the Due Date or during the
related
Prepayment Period and that did not become a Liquidated Mortgage
Loan before
the Due Date.
Overcollateralized Group: Not applicable.
Ownership Interest: As to any Residual Certificate, any
ownership
interest in the Certificate including any interest in the
Certificate as its
Holder and any other interest therein, whether direct or indirect,
legal or
beneficial.
Pass-Through Rate: For each Class of Certificates, 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,
the percentage interest being set forth on its face or equal to the
percentage
obtained by dividing the Denomination of the Certificate by the
aggregate of
the Denominations of all Certificates of the same Class.
Performance Certification: As defined in Section 11.05.
Permitted Investments: At any time, any of the following:
(i)
obligations of the United States or any agency thereof backed by
the
full faith and credit of the United States;
(ii)
general obligations of or obligations guaranteed by any state of
the
United States or the District of Columbia receiving the highest
long-term debt
rating of each Rating Agency, or any lower rating that will not
result in the
downgrading, qualification or withdrawal of the ratings then
assigned to the
Certificates by the Rating Agencies, as evidenced by a signed
writing
delivered by each Rating Agency;
18
<PAGE>
(iii) commercial or finance company paper that is then receiving
the
highest commercial or finance company paper rating of each Rating
Agency, or
any lower rating that will not result in the downgrading,
qualification or
withdrawal of the ratings then assigned to the Certificates by the
Rating
Agencies , as evidenced by a signed writing delivered by each
Rating Agency;
(iv)
certificates of deposit, demand or time deposits, or bankers'
acceptances issued by any depository institution or trust company
incorporated
under the laws of the United States or of any state thereof and
subject to
supervision and examination by federal or state banking
authorities, provided
that the commercial paper or long-term unsecured debt obligations
of the
depository institution or trust company (or in the case of the
principal
depository institution in a holding company system, the commercial
paper or
long-term unsecured debt obligations of the holding company, but
only if
Moody's is not a Rating Agency) are then rated one of the two
highest
long-term and the highest short-term ratings of each Rating Agency
for the
securities, or any lower rating that will not result in the
downgrading,
qualification or withdrawal of the ratings then assigned to the
Certificates
by the Rating Agencies, as evidenced by a signed writing delivered
by each
Rating Agency;
(v)
demand or time deposits or certificates of deposit issued by any
bank
or trust company or savings institution to the extent that the
deposits are
fully insured by the FDIC;
(vi)
guaranteed reinvestment agreements issued by any bank,
insurance
company, or other corporation acceptable to the Rating Agencies at
the time of
the issuance of the agreements, as evidenced by a signed writing
delivered by
each Rating Agency;
(vii) repurchase obligations with respect to any security described
in
clauses (i) and (ii) above, in either case entered into with a
depository
institution or trust company (acting as principal) described in
clause (iv)
above; provided that such repurchase obligation would be accounted
for as a
financing arrangement under generally accepted accounting
principles;
(viii) securities (other than stripped bonds, stripped coupons,
or
instruments sold at a purchase price in excess of 115% of their
face amount)
bearing interest or sold at a discount issued by any corporation
incorporated
under the laws of the United States or any state thereof that, at
the time of
the investment, have one of the two highest ratings of each Rating
Agency
(except if the Rating Agency is Moody's the rating shall be the
highest
commercial paper rating of Moody's for the securities), or any
lower rating
that will not result in the downgrading, qualification or
withdrawal of the
ratings then assigned to the Certificates by the Rating Agencies,
as evidenced
by a signed writing delivered by each Rating Agency and that have a
maturity
date occurring no more than 365 days from their date of
issuance;
(ix)
units of a taxable money-market portfolio having the highest
rating
assigned by each Rating Agency (except (i) if Fitch is a Rating
Agency and has
not rated the portfolio, the highest rating assigned by Moody's and
(ii) if
S&P is a Rating Agency, "AAAm" or "AAAM-G" by S&P) and
restricted to
obligations issued or guaranteed by the United States of America or
entities
whose obligations are backed by the full faith and credit of the
United States
of America and repurchase agreements collateralized by such
obligations; and
(x)
any other investments bearing interest or sold at a discount
acceptable to each Rating Agency that will not result in the
downgrading,
qualification or withdrawal of the ratings then assigned to the
Certificates
by the Rating Agencies, as evidenced by a signed writing delivered
by each
Rating Agency.
No
Permitted Investment may (i) evidence the right to receive
interest
only payments with respect to the obligations underlying the
instrument, (ii)
be sold or disposed of before its maturity or (iii) be any
19
<PAGE>
obligation of the Seller or any of its Affiliates. Any Permitted
Investment
shall be relatively risk free and no options or voting rights shall
be
exercised with respect to any Permitted Investment. Any Permitted
Investment
shall be sold or disposed of in accordance with Financial
Accounting Standard
140, paragraph 35c(6) in effect as of the Closing Date.
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) that 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)
a rural electric and telephone cooperatives described in
section
1381(a)(2)(C) of the Code,
(v)
an "electing large partnership" as defined in section 775 of
the
Code,
(vi)
a Person that is not a U.S. Person, and
(vii) any other Person so designated by the Depositor based on an
Opinion
of Counsel that the Transfer of an Ownership Interest in a
Residual
Certificate to the Person may cause any REMIC created hereunder to
fail to
qualify as a REMIC at any time that the Certificates are
outstanding.
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.
Planned Balance: With respect to any Planned Principal Classes and
any
Distribution Date appearing in the Principal Balance Schedule, the
applicable
amount appearing opposite such Distribution Date for such Planned
Principal
Classes..
Planned Principal Classes: As specified in the Preliminary
Statement.
PO
Formula Principal Amount: As to any Distribution Date and the Class
PO
Certificates, the sum of (i) the sum of the applicable PO
Percentage of (a)
the principal portion of each Scheduled Payment (without giving
effect, prior
to the Bankruptcy Coverage Termination Date, to any reductions
thereof caused
by any Debt Service Reductions or Deficient Valuations) due on each
Mortgage
Loan on the related Due Date, (b) the Stated Principal Balance of
each
Mortgage Loan that was repurchased by the Seller or purchased by
the Servicer
pursuant to this Agreement as of such Distribution Date, excluding
any
Mortgage Loan that was repurchased due to a modification of the
Mortgage Rate,
(c) the Substitution Adjustment Amount in connection with any
Deleted Mortgage
Loan received with respect to such Distribution Date, (d) any
Insurance
Proceeds or Liquidation Proceeds allocable to recoveries of
principal of
Mortgage Loans that are not yet Liquidated Mortgage Loans received
during the
calendar month
20
<PAGE>
preceding the month of such Distribution Date, (e) with respect to
each
Mortgage Loan that became a Liquidated Mortgage Loan during the
month
preceding the calendar month of such Distribution Date, the amount
of
Liquidation Proceeds allocable to principal received with respect
to such
Mortgage Loan during the month preceding the month of such
Distribution Date,
and (f) all Principal Prepayments with respect to the Mortgage
Loans received
during the related Prepayment Period, and (ii) with respect to
Subsequent
Recoveries attributable to a Discount Mortgage Loan that incurred
(1) an
Excess Loss or (2) a Realized Loss after the Senior Credit Support
Depletion
Date, the PO Percentage of any Subsequent Recoveries received
during the
calendar month preceding the month of such Distribution Date.
PO
Percentage: As to any Discount Mortgage Loan, a fraction (expressed
as
a percentage) the numerator of which is the excess of the Required
Coupon over
the Adjusted Net Mortgage Rate of such Discount Mortgage Loan and
the
denominator of which is such Required Coupon. As to any
Non-Discount Mortgage
Loan, 0%.
Pool
Stated Principal Balance: The aggregate Stated Principal Balance
of
the Mortgage Loans.
Prepayment Assumption: The prepayment model used in the
Prospectus
Supplement, which represents an assumed rate of prepayment each
month relative
to the then outstanding principal balance of a pool of mortgage
loans for the
life of those mortgage loans. A 100% Prepayment Assumption assumes
a constant
prepayment rate (a "CPR") of 8% per annum for the first month after
the
closing date and an additional approximately 1.454545% per annum in
each month
thereafter until the twelfth month. Beginning in the twelfth month
and in each
month thereafter during the life of the mortgage loans, a 100%
Prepayment
Assumption assumes a CPR of 24% per annum each month. 0% PPC
assumes no
prepayments. Correspondingly, 200% PPC assumes prepayment rates
equal to two
times the related PPC, and so forth.
Prepayment Charge: As to a Mortgage Loan, any charge payable by
a
Mortgagor in connection with certain partial prepayments and all
prepayments
in full made within the related Prepayment Charge Period, the
Prepayment
Charges with respect to each applicable Mortgage Loan so held by
the Trust
Fund being identified in the Mortgage Loan Schedule.
Prepayment Charge Period: As to any Mortgage Loan, the period of
time
during which a Prepayment Charge may be imposed.
Prepayment Interest Excess: As to any Principal Prepayment received
by
the Servicer on a Mortgage Loan from the first day through the
fifteenth day
of any calendar month other than the month of the Cut-off Date, all
amounts
paid by the related Mortgagor in respect of interest on such
Principal
Prepayment. All Prepayment Interest Excess shall be retained by the
Servicer
as additional servicing compensation.
Prepayment Interest Shortfall: As to any Distribution Date,
Mortgage Loan
and Principal Prepayment received on or after the sixteenth day of
the month
preceding the month of such Distribution Date (or, in the case of
the first
Distribution Date, on or after the Cut-off Date) and on or before
the last day
of the month preceding the month of such Distribution Date, the
amount, if
any, by which one month's interest at the related Mortgage Rate,
net of the
Servicing Fee Rate, on such Principal Prepayment exceeds the amount
of
interest paid in connection with such Principal Prepayment.
Prepayment Period: As to any Distribution Date and related Due
Date, the
period from and including the 16th day of the month immediately
prior to the
month of such Distribution Date (or, in the case of the first
Distribution
Date, from the Cut-off Date) and to and including the 15th day of
the month of
such Distribution Date.
21
<PAGE>
Primary Insurance Policy: Each policy of primary mortgage
guaranty
insurance or any replacement policy therefor with respect to any
Mortgage
Loan.
Principal Balance Schedule: Not applicable.
Principal Only Certificates: As specified in the Preliminary
Statement.
Principal Prepayment: Any payment of principal by a Mortgagor on
a
Mortgage Loan (including the principal portion of the Purchase
Price of any
Mortgage Loan purchased pursuant to Section 3.12) that is received
in advance
of its scheduled Due Date and is not accompanied by an amount
representing
scheduled interest due on any date in any month after the month of
prepayment.
The Servicer shall apply partial Principal Prepayments in
accordance with the
related Mortgage Note.
Principal Prepayment in Full: Any Principal Prepayment made by
a
Mortgagor of the entire principal balance of a Mortgage Loan.
Private Certificates: As specified in the Preliminary
Statement.
Pro
Rata Share: As to any Distribution Date and any Class of
Subordinated
Certificates, the portion of the Subordinated Principal
Distribution Amount
allocable to such Class, equal to the product of the Subordinated
Principal
Distribution Amount on such Distribution Date and a fraction, the
numerator of
which is the related Class Certificate Balance thereof and the
denominator of
which is the aggregate Class Certificate Balance of the
Subordinated
Certificates, in each case immediately prior to such Distribution
Date.
Proprietary Lease: For any Cooperative Unit, a lease or
occupancy
agreement between a Cooperative Corporation and a holder of related
Co-op
Shares.
Prospectus Supplement: The Prospectus Supplement dated October 26,
2006,
relating to the Offered Certificates, and any supplement
thereto.
PUD:
Planned Unit Development.
Purchase Price: For any Mortgage Loan required to be purchased by
the
Seller pursuant to Section 2.02 or 2.03 or purchased by the
Servicer pursuant
to Section 3.12, the sum of
(i)
100% of the unpaid principal balance of the Mortgage Loan on the
date
of the purchase,
(ii)
accrued and unpaid interest on the Mortgage Loan at the
applicable
Mortgage Rate (or at the applicable Adjusted Mortgage Rate if (x)
the
purchaser is the Servicer or (y) if the purchaser is the Seller and
the Seller
is the Servicer) from the date through which interest was last paid
by the
Mortgagor to the Due Date in the month in which the Purchase Price
is to be
distributed to Certificateholders, net of any unreimbursed Advances
made by
the Servicer on the Mortgage Loan, and
(iii) any costs and damages incurred by the Trust Fund in
connection with
any violation by the Mortgage Loan of any predatory or abusive
lending law.
If
the Mortgage Loan is purchased pursuant to Section 3.12, the
interest
component of the Purchase Price shall be computed (i) on the basis
of the
applicable Adjusted Mortgage Rate before giving effect to the
related
modification and (ii) from the date to which interest was last paid
to the
date on which the Mortgage Loan is assigned to the Servicer
pursuant to
Section 3.12.
22
<PAGE>
Qualified Insurer: A mortgage guaranty insurance company duly
qualified
as such under the laws of the state of its principal place of
business and
each state having jurisdiction over the insurer in connection with
the
insurance policy issued by the insurer, duly authorized and
licensed in such
states to transact a mortgage guaranty insurance business in such
states and
to write the insurance provided by the insurance policy issued by
it, approved
as a FNMA- or FHLMC-approved mortgage insurer or having a claims
paying
ability rating of at least "AA" or equivalent rating by a
nationally
recognized statistical rating organization. Any replacement insurer
with
respect to a Mortgage Loan must have at least as high a claims
paying ability
rating as the insurer it replaces had on the Closing Date.
Rating Agency: Each of the Rating Agencies specified in the
Preliminary
Statement. If any of them or a successor is no longer in existence,
"Rating
Agency" shall be the nationally recognized statistical rating
organization, or
other comparable Person, designated by the Depositor and named in
the
Underwriters' Exemption, notice of which designation shall be given
to the
Trustee. References to a given rating or rating category of a
Rating Agency
means the rating category without giving effect to any
modifiers.
Realized Loss: With respect to each Liquidated Mortgage Loan, an
amount
(not less than zero or more than the Stated Principal Balance of
the Mortgage
Loan) as of the date of such liquidation, equal to (i) the Stated
Principal
Balance of the Liquidated Mortgage Loan as of the date of such
liquidation,
plus (ii) interest at the Adjusted Net Mortgage Rate from the Due
Date as to
which interest was last paid or advanced (and not reimbursed)
to
Certificateholders up to the Due Date in the month in which
Liquidation
Proceeds are required to be distributed on the Stated Principal
Balance of
such Liquidated Mortgage Loan from time to time, minus (iii) the
Liquidation
Proceeds, if any, received during the month in which such
liquidation
occurred, to the extent applied as recoveries of interest at the
Adjusted Net
Mortgage Rate and to principal of the Liquidated Mortgage Loan.
With respect
to each Mortgage Loan that has become the subject of a Deficient
Valuation, if
the principal amount due under the related Mortgage Note has been
reduced, the
difference between the principal balance of the Mortgage Loan
outstanding
immediately prior to such Deficient Valuation and the principal
balance of the
Mortgage Loan as reduced by the Deficient Valuation. With respect
to each
Mortgage Loan that has become the subject of a Debt Service
Reduction and any
Distribution Date, the amount, if any, by which the principal
portion of the
related Scheduled Payment has been reduced.
To
the extent the Servicer receives Subsequent Recoveries with respect
to
any Mortgage Loan, the amount of the Realized Loss with respect to
that
Mortgage Loan will be reduced by such Subsequent Recoveries.
Recognition Agreement: For any Cooperative Loan, an agreement
between the
Cooperative Corporation and the originator of the Mortgage Loan
that
establishes the rights of the originator in the Cooperative
Property.
Record Date: With respect to any Distribution Date and any
Definitive
Certificate and the Delay Certificates, the close of business on
the last
Business Day of the month preceding the month of that Distribution
Date. With
respect to any Distribution Date and the Non-Delay Certificates as
long as
they are Book-Entry Certificates, the Business Day immediately
prior to such
Distribution Date.
Reference Bank: As defined in Section 4.09.
Refinance Loan: Any Mortgage Loan the proceeds of which are used
to
refinance an Original Mortgage Loan.
Regular Certificates: As specified in the Preliminary
Statement.
23
<PAGE>
Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation
AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended from
time to
time, and subject to such clarification and interpretation as have
been
provided by the Commission in the adopting release (Asset-Backed
Securities,
Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan.
7, 2005))
or by the staff of the Commission, or as may be provided by the
Commission or
its staff from time to time.
Relief Act: The Servicemembers Civil Relief Act.
Relief Act Reductions: With respect to any Distribution Date and
any
Mortgage Loan as to which there has been a reduction in the amount
of interest
collectible thereon for the most recently ended calendar month as a
result of
the application of the Relief Act or any similar state or local
laws, the
amount, if any, by which (i) interest collectible on such Mortgage
Loan for
the most recently ended calendar month is less than (ii) interest
accrued
thereon for such month pursuant to the Mortgage Note.
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.
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.
Reportable Event: Any event required to be reported on Form 8-K,
and in
any event, the following:
(a)
entry into a definitive agreement related to the Trust Fund,
the
Certificates or the Mortgage Loans, or an amendment to a
Transaction Document,
even if the Depositor is not a party to such agreement (e.g., a
servicing
agreement with a servicer contemplated by Item 1108(a)(3) of
Regulation AB);
(b)
termination of a Transaction Document (other than by expiration
of
the agreement on its stated termination date or as a result of all
parties
completing their obligations under such agreement), even if the
Depositor is
not a party to such agreement (e.g., a servicing agreement with a
servicer
contemplated by Item 1108(a)(3) of Regulation AB);
(c)
with respect to the Servicer only, if the Servicer becomes aware
of
any bankruptcy or receivership with respect to the Seller, the
Depositor, the
Servicer, the Trustee, any enhancement or support provider
contemplated by
Items 1114(b) or 1115 of Regulation AB, or any other material
party
contemplated by Item 1101(d)(1) of Regulation AB;
(d)
with respect to the Trustee, the Servicer and the Depositor only,
the
occurrence of an early amortization, performance trigger or other
event,
including an Event of Default under this Agreement;
(e)
any amendment to this Agreement;
(f)
the resignation, removal, replacement, substitution of the
Servicer
or the Trustee;
24
<PAGE>
(g)
with respect to the Servicer only, if the Servicer becomes aware
that
(i) any material enhancement or support specified in Item
1114(a)(1) through
(3) of Regulation AB or Item 1115 of Regulation AB that was
previously
applicable regarding one or more classes of the Certificates has
terminated
other than by expiration of the contract on its stated termination
date or as
a result of all parties completing their obligations under such
agreement;
(ii) any material enhancement specified in Item 1114(a)(1) through
(3) of
Regulation AB or Item 1115 of Regulation AB has been added with
respect to one
or more Classes of the Certificates; or (iii) any existing
material
enhancement or support specified in Item 1114(a)(1) through (3) of
Regulation
AB or Item 1115 of Regulation AB with respect to one or more
Classes of the
Certificates has been materially amended or modified; and
(h)
with respect to the Trustee, the Servicer and the Depositor only,
a
required distribution to Holders of the Certificates is not made as
of the
required Distribution Date under this Agreement.
Reporting Subcontractor: With respect to the Servicer or the
Trustee, any
Subcontractor determined by such Person pursuant to Section
11.08(b) to be
"participating in the servicing function" within the meaning of
Item 1122 of
Regulation AB. References to a Reporting Subcontractor shall refer
only to the
Subcontractor of such Person and shall not refer to Subcontractors
generally.
Request for Release: The Request for Release submitted by the
Servicer to
the Trustee, substantially in the form of Exhibits M and N, as
appropriate.
Required Coupon: 6.25% per annum.
Required Insurance Policy: For any Mortgage Loan, any insurance
policy
that is required to be maintained from time to time under this
Agreement.
Residual Certificates: As specified in the Preliminary
Statement.
Responsible Officer: When used with respect to the Trustee, any
Managing
Director, any Director, Vice President, any Assistant Vice
President, any
Associate, any Assistant Secretary, any Trust Officer, 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, the matter is referred because
of the
officer's knowledge of and familiarity with the particular subject
and who has
direct responsibility for the administration of this Agreement.
Restricted Classes: As defined in Section 4.02(e).
SAIF: The Savings Association Insurance Fund, or any successor
thereto.
Sarbanes-Oxley Certification: As defined in Section 11.05.
S&P: Standard & Poor's, a division of The McGraw-Hill
Companies, Inc. If
S&P is designated as a Rating Agency in the Preliminary
Statement, for
purposes of Section 10.05(b) the address for notices to S&P
shall be Standard
& Poor's, a division of The McGraw-Hill Companies, Inc., 55
Water Street, New
York, New York 10041, Attention: Mortgage Surveillance Monitoring,
or any
other address that S&P furnishes to the Depositor and the
Servicer.
Scheduled Balance: Not applicable.
Scheduled Classes: As specified in the Preliminary Statement.
25
<PAGE>
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.
Securities Act: The Securities Act of 1933, as amended.
Security Agreement: For any Cooperative Loan, the agreement between
the
owner of the related Co-op Shares and the originator of the related
Mortgage
Note that defines the security interest in the Co-op Shares and the
related
Proprietary Lease.
Seller: IndyMac Bank, F.S.B., a federal savings bank, and its
successors
and assigns, in its capacity as seller of the Mortgage Loans to the
Depositor.
Senior Certificate Group: None.
Senior Certificates: As specified in the Preliminary Statement.
Senior Credit Support Depletion Date: The date on which the
Class
Certificate Balance of each Class of Subordinated Certificates has
been
reduced to zero.
Senior Percentage: As to any Distribution Date, the percentage
equivalent
of a fraction the numerator of which is the Class Certificate
Balance of the
Class A-1 Certificates immediately before the Distribution Date and
the
denominator of which is the aggregate Class Certificate Balance of
the
Certificates (other than the Class PO Certificates and the Notional
Amount
Certificates) immediately before the Distribution Date.
Senior Prepayment Percentage: As to any Distribution Date during
the five
years beginning on the first Distribution Date, 100%. The Senior
Prepayment
Percentage for any Distribution Date occurring on or after the
fifth
anniversary of the first Distribution Date will, except as provided
in this
Agreement, be as follows: for any Distribution Date in the first
year
thereafter, the Senior Percentage plus 70% of the Subordinated
Percentage for
such Distribution Date; for any Distribution Date in the second
year
thereafter, the Senior Percentage plus 60% of the Subordinated
Percentage for
such Distribution Date; for any Distribution Date in the third
year
thereafter, the Senior Percentage plus 40% of the Subordinated
Percentage for
such Distribution Date; for any Distribution Date in the fourth
year
thereafter, the Senior Percentage plus 20% of the Subordinated
Percentage for
such Distribution Date; and for any Distribution Date thereafter,
the Senior
Percentage for such Distribution Date (unless on any Distribution
Date the
Senior Percentage exceeds the initial Senior Percentage, in which
case the
Senior Prepayment Percentage for such Distribution Date will once
again equal
100%). Notwithstanding the foregoing, no decrease in the Senior
Prepayment
Percentage will occur unless both Senior Step Down Conditions are
satisfied.
Senior Principal Distribution Amount: As to any Distribution Date,
the
sum of (i) the related Senior Percentage of the Non-PO Percentage
of all
amounts described in subclauses (a) through (d) of clause (i) of
the
definition of Non-PO Formula Principal Amount for such Distribution
Date, (ii)
for each Mortgage Loan that became a Liquidated Mortgage Loan
during the
calendar month preceding the month of the Distribution Date, the
lesser of the
Senior Percentage of the applicable Non-PO Percentage of the Stated
Principal
Balance of the Mortgage Loan, and either if no Excess Losses were
sustained on
a Liquidated Mortgage Loan during the preceding calendar month, the
Senior
Prepayment Percentage of the applicable Non-PO Percentage of the
amount of the
liquidation proceeds allocable to principal received on the
Mortgage Loan or
if an Excess Loss were sustained on the Liquidated Mortgage Loan
during the
preceding calendar month, the Senior Percentage of the applicable
Non-PO
Percentage of the amount of
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<PAGE>
the liquidation proceeds allocable to principal received on the
Mortgage Loan,
and, and (iii) the Senior Prepayment Percentage of the applicable
Non-PO
Percentage of the amounts described in subclause (f) of clause (i)
of the
definition of Non-PO Formula Principal Amount for such Distribution
Date, and
(iv) the Senior Prepayment Percentage of any Subsequent Recoveries
described
in clause (ii) of the definition of Non-PO Formula Principal Amount
for such
Distribution Date; provided, however, that if a Bankruptcy Loss
that is an
Excess Loss is sustained with respect to a Mortgage Loan that is
not a
Liquidated Mortgage Loan, the Senior Principal Distribution Amount
will be
reduced on the related Distribution Date by the Senior Percentage
of the
applicable Non-PO Percentage of the principal portion of such
Bankruptcy Loss.
Senior Step Down Conditions: As to any Distribution Date: (i)
the
aggregate Stated Principal Balance of all Mortgage Loans 60 days or
more
Delinquent (averaged over the preceding six month period)
(including any
Mortgage Loans subject to foreclosure proceedings, REO Property
(regardless of
whether that Mortgage Loan is 60 days or more Delinquent) and
Mortgage Loans
the mortgagors of which are in bankruptcy), as a percentage of the
aggregate
Class Certificate Balance of the Subordinated Certificates, does
not equal or
exceed 50%, and (ii) cumulative Realized Losses do not exceed: (a)
commencing
with the Distribution Date on the fifth anniversary of the first
Distribution
Date, 30% of the Original Subordinated Principal Balance, (b)
commencing with
the Distribution Date on the sixth anniversary of the first
Distribution Date,
35% of the Original Subordinated Principal Balance, (c) commencing
with the
Distribution Date on the seventh anniversary of the first
Distribution Date,
40% of the Original Subordinated Principal Balance, (d) commencing
with the
Distribution Date on the eighth anniversary of the first
Distribution Date,
45% of the Original Subordinated Principal Balance, and (e)
commencing with
the Distribution Date on the ninth anniversary of the first
Distribution Date,
50% of the Original Subordinated Principal Balance.
Senior Termination Date: Not applicable.
Servicer: IndyMac Bank, F.S.B., a federal savings bank, and its
successors and assigns, in its capacity as Servicer under this
Agreement.
Servicer Advance Date: As to any Distribution Date, 12:30 P.M.
Pacific
time on the Business Day preceding the Distribution Date.
Servicing Advances: All customary, reasonable, and necessary "out
of
pocket" costs and expenses incurred in the performance by the
Servicer of its
servicing obligations, including the cost of
(a) the preservation, restoration, and protection of a
Mortgaged
Property,
(b) expenses reimbursable to the Servicer pursuant to Section
3.12
and
any enforcement or judicial proceedings, including
foreclosures,
(c) the maintenance and liquidation of any REO Property,
(d) compliance with the obligations under Section 3.10; and
(e) reasonable compensation to the Servicer or its affiliates
for
acting as broker in connection with the sale of foreclosed
Mortgaged
Properties and for performing certain default management and
other
similar services (including appraisal services) in connection with
the
servicing of defaulted Mortgage Loans. For purposes of this clause
(e),
only
costs and expenses incurred in connection with the performance
of
activities generally considered to be outside the scope of
customary
servicing duties shall be treated as Servicing Advances.
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<PAGE>
Servicing Criteria: The "servicing criteria" set forth in Item
1122(d) of
Regulation AB.
Servicing Fee: As to each Mortgage Loan and any Distribution Date,
one
month's interest at the applicable Servicing Fee Rate on the Stated
Principal
Balance of the Mortgage Loan, or, whenever a payment of interest
accompanies a
Principal Prepayment in Full made by the Mortgagor, interest at the
Servicing
Fee Rate on the Stated Principal Balance of the Mortgage Loan for
the period
covered by the payment of interest, subject to reduction as
provided in
Section 3.15.
Servicing Fee Rate: For each Mortgage Loan, the per annum rate
specified
on the Mortgage Loan Schedule.
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 the list may from time to time be amended.
Servicing Standard: That degree of skill and care exercised by
the
Servicer with respect to mortgage loans comparable to the Mortgage
Loans
serviced by the Servicer for itself or others.
Special Hazard Coverage Termination Date: The point in time at
which the
Special Hazard Loss Coverage Amount is reduced to zero.
Special Hazard Loss: Any Realized Loss suffered by a Mortgaged
Property
on account of direct physical loss, but not including (i) any loss
of a type
covered by a hazard insurance policy or a flood insurance policy
required to
be maintained with respect to such Mortgaged Property pursuant to
Section 3.10
to the extent of the amount of such loss covered thereby, or (ii)
any loss
caused by or resulting from:
(a) normal wear and tear;
(b) fraud, conversion or other dishonest act on the part of the
Trustee, the Servicer or any of their agents or employees (without
regard
to
any portion of the loss not covered by any errors and omissions
policy);
(c) errors in design, faulty workmanship or faulty materials,
unless
the
collapse of the property or a part thereof ensues and then only
for
the
ensuing loss;
(d) nuclear or chemical reaction or nuclear radiation or
radioactive
or
chemical contamination, all whether controlled or uncontrolled,
and
whether such loss be direct or indirect, proximate or remote or be
in
whole or in part caused by, contributed to or aggravated by a
peril
covered by the definition of the term "Special Hazard Loss";
(e) hostile or warlike action in time of peace and war,
including
action in hindering, combating or defending against an actual,
impending
or
expected attack:
1. by any government or sovereign power, de jure or de facto,
or by any authority maintaining or using military, naval or air
forces; or
2. by military, naval or air forces; or
3. by an agent of any such government, power, authority or
forces;
28
<PAGE>
(f) any weapon of war employing nuclear fission, fusion or
other
radioactive force, whether in time of peace or war; or
(g) insurrection, rebellion, revolution, civil war, usurped power
or
action taken by governmental authority in hindering, combating
or
defending against such an occurrence, seizure or destruction
under
quarantine or customs regulations, confiscation by order of any
government or public authority, or risks of contraband or
illegal
transportation or trade.
Special Hazard Loss Coverage Amount: With respect to the first
Distribution Date, $4,021,048.15. With respect to any Distribution
Date after
the first Distribution Date, the lesser of (a) the greatest of (i)
1% of the
aggregate of the principal balances of the Mortgage Loans, (ii)
twice the
principal balance of the largest Mortgage Loan and (iii) the
aggregate of the
principal balances of all Mortgage Loans secured by Mortgaged
Properties
located in the single California postal zip code area having the
highest
aggregate principal balance of any such zip code area and (b) the
Special
Hazard Loss Coverage Amount as of the Closing Date less the amount,
if any, of
Special Hazard Losses allocated to the Certificates since the
Closing Date.
All principal balances for the purpose of this definition will be
calculated
as of the first day of the calendar month preceding the month of
such
Distribution Date after giving effect to Scheduled Payments on the
Mortgage
Loans then due, whether or not paid.
Special Hazard Mortgage Loan: A Liquidated Mortgage Loan as to
which a
Special Hazard Loss has occurred.
Startup Day: The Closing Date.
Stated Principal Balance: As to any Mortgage Loan and Due Date,
the
unpaid principal balance of such Mortgage Loan as of such Due Date,
as
specified in the amortization schedule at the time relating thereto
(before
any adjustment to such amortization schedule by reason of any
moratorium or
similar waiver or grace period) after giving effect to the sum of:
(i) the
payment of principal due on such Due Date and irrespective of any
delinquency
in payment by the related Mortgagor and (ii) any Liquidation
Proceeds
allocable to principal received in the prior calendar month and
Principal
Prepayments received through the last day of the Prepayment Period
in which
the Due Date occurs, in each case with respect to such Mortgage
Loan.
Subcontractor: Any vendor, subcontractor or other Person that is
not
responsible for the overall servicing (as "servicing" is commonly
understood
by participants in the mortgage-backed securities market) of
Mortgage Loans
but performs one or more discrete functions identified in Item
1122(d) of
Regulation AB with respect to the Mortgage Loans under the
direction or
authority of the Servicer or the Trustee, as the case may be.
Subordinated Certificates: As specified in the Preliminary
Statement.
Subordinated Percentage: As to any Distribution Date, 100% minus
the
Senior Percentage for such Distribution Date.
Subordinated Prepayment Percentage: As to any Distribution Date,
100%
minus the Senior Prepayment Percentage for such Distribution
Date.
Subordinated Principal Distribution Amount: As to any Distribution
Date,
the sum of the following: (i) the Subordinated Percentage of the
applicable
Non-PO Percentage of all amounts described in subclauses (a)
through (d) of
clause (i) of the definition of Non-PO Formula Principal Amount
with respect
to such Distribution Date, (ii) for each Mortgage Loan that became
a
Liquidated Mortgage Loan
29
<PAGE>
during the calendar month preceding the month of the Distribution
Date, the
applicable Non-PO Percentage of the portion of the Liquidation
Proceeds
allocable to principal received on the Mortgage Loan, after
application of the
amounts pursuant to clause (ii) of the definition of Senior
Principal
Distribution Amount, up to the Subordinated Percentage of the
applicable
Non-PO Percentage of the Stated Principal Balance of the Mortgage
Loan, and
(iii) the Subordinated Prepayment Percentage of the applicable
Non-PO
Percentage of the amounts described in subclause (f) of clause (i)
and in
clause (ii) of the definition of Non-PO Formula Principal Amount
with respect
to such Distribution Date, reduced by the amount of any payments in
respect of
Class PO Deferred Amounts for such Distribution Date.
Subsequent Recoveries: As to any Distribution Date, with respect to
a
Liquidated Mortgage Loan that resulted in a Realized Loss in a
prior calendar
month, unexpected amounts received by the Servicer (net of any
related
expenses permitted to be reimbursed pursuant to Section 3.09)
specifically
related to such Liquidated Mortgage Loan.
Substitute Mortgage Loan: A
Mortgage Loan substituted by the Seller for a
Deleted Mortgage Loan that must, on the date of substitution, as
confirmed in
a Request for Release, substantially in the form of Exhibit M,
(i)
have a Stated Principal Balance, after deduction of the
principal
portion of the Scheduled Payment due in the month of substitution,
not in
excess of, and not more than 10% less than, the Stated Principal
Balance of
the Deleted Mortgage Loan (unless the amount of any shortfall is
deposited by
the Seller in the Certificate Account and held for distribution to
the
Certificateholders on the related Distribution Date);
(ii)
have a Mortgage Rate no lower than and not more than 1% per
annum
higher than the Deleted Mortgage Loan;
(iii) have a Loan-to-Value Ratio no higher than that of the
Deleted
Mortgage Loan;
(iv)
have a remaining term to maturity no greater than (and not more
than
one year less than) that of the Deleted Mortgage Loan;
(v)
not be a Cooperative Loan unless the Deleted Mortgage Loan was
a
Cooperative Loan; and
(vi)
comply with each representation and warranty in Section 2.03.
Substitution Adjustment Amount: As defined in Section 2.03.
Supplemental Interest Reserve Fund: Not applicable.
Supplemental Interest Trust: Not applicable.
Supplemental Interest Trustee: Not applicable.
Suspension Notification: Notification to the Commission of the
suspension
of the Trust Fund's obligation to file reports pursuant to Section
15(d) of
the Exchange Act.
Targeted Balance: Not applicable.
Targeted Principal Classes: As specified in the Preliminary
Statement.
30
<PAGE>
Termination Date: Not applicable.
Transaction Documents: This Agreement and any other document or
agreement
entered into in connection with the Trust Fund, the Certificates or
the
Mortgage Loans.
Transfer: Any direct or indirect transfer or sale of any
Ownership
Interest in a Residual Certificate.
Transfer Payment Made:
Not applicable.
Transfer Payment Received: Not applicable.
Trust Fund: The corpus of the trust created under this
Agreement
consisting of
(i)
the Mortgage Loans and all interest and principal received on
them
after the Cut-off Date, other than amounts due on the Mortgage
Loans by the
Cut-off Date;
(ii)
the Certificate Account, the Distribution Account and all
amounts
deposited therein pursuant to this Agreement (including amounts
received from
the Seller on the Closing Date that will be deposited by the
Trustee in the
Certificate Account pursuant to Section 2.01);
(iii) property that secured a Mortgage Loan and has been acquired
by
foreclosure, deed-in-lieu of foreclosure, or otherwise;
(iv)
the right to collect any amounts under any mortgage insurance
policies covering any Mortgage Loan and any collections received
under any
mortgage insurance policies covering any Mortgage Loan;
(v)
[reserved]; and
(vi)
all proceeds of the conversion, voluntary or involuntary, of any
of
the foregoing.
Trustee: Deutsche Bank National Trust Company and its successors
and, if
a successor trustee is appointed under this Agreement, the
successor.
Trustee Fee: The fee payable to the Trustee on each Distribution
Date for
its services as Trustee hereunder, in an amount equal to
one-twelfth of the
Trustee Fee Rate multiplied by the aggregate Stated Principal
Balance of the
Mortgage Loans immediately prior to such Distribution Date.
Trustee Fee Rate: 0.0075% per annum.
The
terms "United States," "State," and "International Organization"
have
the meanings 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 the
Federal Home Loan
Mortgage Corporation, a majority of its board of directors is not
selected by
such government unit.
UCC: The Uniform
Commercial Code for the State of New York.
Undercollateralized Group: Not applicable.
31
<PAGE>
Underwriter's Exemption: Prohibited Transaction Exemption 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.
United States Person or 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 before that date, may elect to
continue to
be U.S. Persons.
U.S.A. Patriot Act: The Uniting and Strengthening America by
Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act
of 2001.
Voting Rights: The portion of the voting rights of all of the
Certificates that is allocated to any Certificate. As of any date
of
determination, (a) 1% of all Voting Rights shall be allocated to
each Class of
Notional Amount Certificates (the Voting Rights to be allocated
among the
holders of Certificates of each Class in accordance with their
respective
Percentage Interests), (b) 1% of all Voting Rights shall be
allocated to the
Holder of the Class A-R Certificates and (c) the remaining Voting
Rights shall
be allocated among Holders of the remaining Classes of Offered
Certificates in
proportion to the Certificate Balances of the respective
Certificates on the
date.
Withdrawal Date: The 18th day of each month, or if such day is not
a
Business Day, the next preceding Business Day.
Yield Supplement Amount: Not applicable.
Section 1.02 Rules of Construction.
Except as otherwise expressly provided in this Agreement or unless
the
context clearly requires otherwise
(a) References to designated articles, sections, subsections,
exhibits, and other subdivisions of this Agreement, such as
"Section 6.12
(a)," refer to the designated article, section, subsection,
exhibit, or
other subdivision of this Agreement as a whole and to all
subdivisions of
the
designated article, section, subsection, exhibit, or other
subdivision. The words "herein," "hereof," "hereto," "hereunder,"
and
other words of similar import refer to this
32
<PAGE>
Agreement as a whole and not to any particular article, section,
exhibit,
or
other subdivision of this Agreement.
(b) Any term that relates to a document or a statute, rule, or
regulation includes any amendments, modifications, supplements, or
any
other changes that may have occurred since the document, statute,
rule,
or
regulation came into being, including changes that occur after
the
date
of this Agreement.
(c) Any party may execute any of the requirements under this
Agreement either directly or through others, and the right to
cause
something to be done rather than doing it directly shall be
implicit in
every requirement under this Agreement. Unless a provision is
restricted
as
to time or limited as to frequency, all provisions under this
Agreement are implicitly available and things may happen from time
to
time.
(d) The term "including" and all its variations mean "including
but
not
limited to." Except when used in conjunction with the word
"either,"
the
word "or" is always used inclusively (for example, the phrase "A
or
B"
means "A or B or both," not "either A or B but not both").
(e) A reference to "a [thing]" or "any [of a thing]" does not
imply
the
existence or occurrence of the thing referred to even though
not
followed by "if any," and "any [of a thing]" is any of it. A
reference to
the
plural of anything as to which there could be either one or more
than
one
does not imply the existence of more than one (for instance,
the
phrase "the obligors on a note" means "the obligor or obligors on
a
note"). "Until [something occurs]" does not imply that it must
occur, and
will
not be modified by the word "unless." The word "due" and the
word
"payable" are each used in the sense that the stated time for
payment has
passed. The word "accrued" is used in its accounting sense, i.e.,
an
amount paid is no longer accrued. In the calculation of amounts
of
things, differences and sums may generally result in negative
numbers,
but
when the calculation of the excess of one thing over another
results
in
zero or a negative number, the calculation is disregarded and
an
"excess" does not exist. Portions of things may be expressed as
fractions
or
percentages interchangeably.
(f) All accounting terms used in an accounting context and not
otherwise defined, and accounting terms partly defined in this
Agreement,
to
the extent not completely defined, shall be construed in
accordance
with
generally accepted accounting principles. To the extent that
the
definitions of accounting terms in this Agreement are inconsistent
with
their meanings under generally accepted accounting principles,
the
definitions contained in this Agreement shall control. Capitalized
terms
used
in this Agreement without definition that are defined in the
Uniform
Commercial Code are used in this Agreement as defined in the
Uniform
Commercial Code.
(g) In the computation of a period of time from a specified date
to
a
later specified date or an open-ended period, the words "from"
and
"beginning" mean "from and including," the word "after" means "from
but
excluding," the words "to" and "until" mean "to but excluding," and
the
word
"through" means "to and including." Likewise, in setting
deadlines
or
other periods, "by" means "by." The words "preceding,"
"following,"
and
words of similar import, mean immediately preceding or
following.
References to a month or a year refer to calendar months and
calendar
years.
(h) Any reference to the enforceability of any agreement against
a
party means that it is enforceable, subject as to enforcement
against the
party, to applicable bankruptcy, insolvency,
33
<PAGE>
reorganization, and other similar laws of general applicability
relating
to
or affecting creditors' rights and to general equity
principles.
34
<PAGE>
ARTICLE TWO
CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES
Section 2.01 Conveyance of Mortgage Loans.
(a) The Seller, concurrently with the execution and delivery of
this
Agreement, hereby transfers to the Depositor, without recourse, all
the
interest of the Seller in each Mortgage Loan, including all
interest and
principal received or receivable by the Seller on each Mortgage
Loan
after the Cut-off Date and all interest and principal payments on
each
Mortgage Loan received before the Cut-off Date for installments
of
interest and principal due after the Cut-off Date but not
including
payments of principal and interest due by the Cut-off Date. By
the
Closing Date, the Seller shall deliver to the Depositor or, at
the
Depositor's direction, to the Trustee or other designee of the
Depositor,
the
Mortgage File for each Mortgage Loan listed in the Mortgage
Loan
Schedule (except that, in the case of Mortgage Loans that are
Delay
Delivery Mortgage Loans, such delivery may take place within
five
Business Days of the Closing Date) as of the Closing Date. The
delivery
of
the Mortgage Files shall be made against payment by the Depositor
of
the
purchase price, previously agreed to by the Seller and Depositor,
for
the
Mortgage Loans. With respect to any Mortgage Loan that does not
have
a
first payment date on or before the Due Date in the month of the
first
Distribution Date, the Seller shall deposit into the Distribution
Account
on
the first Distribution Account Deposit Date an amount equal to
one
month's interest at the related Adjusted Mortgage Rate on the
Cut-off
Date
Principal Balance of such Mortgage Loan. Also on the Closing
Date
the
Depositor shall deposit $100 into the Certificate Account.
(b) The Depositor, concurrently with the execution and delivery
of
this
Agreement, hereby transfers to the Trustee for the benefit of
the
Certificateholders, without recourse, all the interest of the
Depositor
in
the Trust Fund, together with the Depositor's right to require
the
Seller to cure any breach of a representation or warranty made in
this
Agreement by the Seller or to repurchase or substitute for any
affected
Mortgage Loan in accordance with this Agreement.
(c) In connection with the transfer and assignment of each
Mortgage
Loan, the Depositor has delivered (or, in the case of the Delay
Delivery
Mortgage Loans, will deliver to the Trustee within the time
periods
specified in the definition of Delay Delivery Mortgage Loans), for
the
benefit of the Certificateholders the following documents or
instruments
with
respect to each Mortgage Loan so assigned:
(i) The original Mortgage Note, endorsed by manual or facsimile
signature in blank in the following form: "Pay to the order of
_______________
______________without recourse," with all intervening
endorsements showing a complete chain of endorsement from the
originator
to
the Person endorsing the Mortgage Note (each endorsement being
sufficient to transfer all interest of the party so endorsing,
as
noteholder or assignee thereof, in that Mortgage Note) or a lost
note
affidavit for any Lost Mortgage Note from the Seller stating that
the
original Mortgage Note was lost or destroyed, together with a copy
of the
Mortgage Note;
(ii) Except as provided below and for each Mortgage Loan that is
not
a
MERS Mortgage Loan, the original recorded Mortgage or a copy of
such
Mortgage certified by the Seller as being a true and complete copy
of the
Mortgage (or, in the case of a Mortgage for which the related
Mortgaged
Property is located in the Commonwealth of Puerto Rico, a true copy
of
the
Mortgage certified as such by the applicable notary) and in the
case
of
each MERS Mortgage
35
<PAGE>
Loan, the original Mortgage, noting the presence of the MIN of
the
Mortgage Loan and either language indicating that the Mortgage Loan
is a
MOM
Loan if the Mortgage Loan is a MOM Loan or if the Mortgage Loan
was
not
a MOM Loan at origination, the original Mortgage and the
assignment
thereof to MERS, with evidence of recording indicated thereon, or a
copy
of
the Mortgage certified by the public recording office in which
such
Mortgage has been recorded;
(iii) in the case of each Mortgage Loan that is not a MERS
Mortgage
Loan, a duly executed assignment of the Mortgage (which may be
included
in a
blanket assignment or assignments), together with, except as
provided below, all interim recorded assignments of the mortgage
(each
assignment, when duly and validly completed, to be in recordable
form and
sufficient to effect the assignment of and transfer to its assignee
of
the
Mortgage to which the assignment relates). If the related
Mortgage
has
not been returned from the applicable public recording office,
the
assignment of the Mortgage may exclude the information to be
provided by
the
recording office. The assignment of Mortgage need not be delivered
in
the
case of a Mortgage for which the related Mortgage Property is
located
in
the Commonwealth of Puerto Rico;
(iv) The original or copies of each assumption, modification,
written assurance, or substitution agreement;
(v) Except as provided below, the original or duplicate
original
lender's title policy and all its riders;
(vi) The originals of the following documents for each
Cooperative
Loan:
(A)
the Co-op Shares,
together with a stock power in blank;
(B) the executed
Security Agreement;
(C) the executed
Proprietary Lease;
(D) the executed
Recognition Agreement;
(E) the executed UCC-1
financing statement that has been filed
in all places required to perfect the Seller's interest in
the Co-op Shares and the Proprietary Lease with evidence
of recording on it; and
(F) executed UCC-3
financing statements or other appropriate
UCC financing statements required by state law, evidencing
a complete and unbroken line from the mortgagee to the
Trustee with evidence of recording thereon (or in a form
suitable for recordation). If in connection with any
Mortgage Loan the Depositor cannot deliver
(a) the original
recorded Mortgage,
(b) all interim
recorded assignments, or
(c) the lender's title
policy (together with all its
riders).
In addition, in connection with the assignment of any MERS
Mortgage
Loan, the Seller agrees that it will cause, at the Seller's
expense, the
MERS(R) System to indicate that the Mortgage Loans
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sold by the Seller to the Depositor have been assigned by the
Seller to the
Trustee in accordance with this Agreement for the benefit of
the
Certificateholders by including (or deleting, in the case of
Mortgage Loans
that are repurchased in accordance with this Agreement) in such
computer files
the information required by the MERS(R) System to identify the
series of the
Certificates issued in connection with such Mortgage Loans. The
Seller further
agrees that it will not, and will not permit the Servicer to, and
the Servicer
agrees that it will not, alter the information referenced in this
paragraph
with respect to any Mortgage Loan sold by the Seller to the
Depositor during
the term of this Agreement unless and until such Mortgage Loan is
repurchased
in accordance with the terms of this Agreement.
In
the event that in connection with any Mortgage Loan that is not a
MERS
Mortgage Loan the Depositor cannot deliver (a) the original
recorded Mortgage,
(b) all interim recorded assignments or (c) the lender's title
policy
(together with all riders thereto) satisfying the requirements of
clause (ii),
(iii) or (v) above, respectively, concurrently with the execution
and delivery
of this Agreement because such document or documents have not been
returned
from the applicable public recording office in the case of clause
(ii) or
(iii) above, or because the title policy has not been delivered to
either the
Servicer or the Depositor by the applicable title insurer in the
case of
clause (v) above, then the Depositor shall promptly deliver to the
Trustee, in
the case of clause (ii) or (iii) above, the original Mortgage or
the interim
assignment, as the case may be, with evidence of recording
indicated on when
it is received from the public recording office, or a copy of it,
certified,
if appropriate, by the relevant recording office and in the case of
clause (v)
above, the original or a copy of a written commitment or interim
binder or
preliminary report of title issued by the title insurance or escrow
company,
with the original or duplicate copy thereof to be delivered to the
Trustee
upon receipt thereof. The delivery of the original Mortgage Loan
and each
interim assignment or a copy of them, certified, if appropriate, by
the
relevant recording office, shall not be made later than one year
following the
Closing Date, or, in the case of clause (v) above, later than 120
days
following the Closing Date. If the Depositor is unable to deliver
each
Mortgage by that date and each interim assignment because any
documents have
not been returned by the appropriate recording office, or, in the
case of each
interim assignment, because the related Mortgage has not been
returned by the
appropriate recording office, the Depositor shall deliver the
documents to the
Trustee as promptly as possible upon their receipt and, in any
event, within
720 days following the Closing Date.
The
Depositor shall forward to the Trustee (a) from time to time
additional original documents evidencing an assumption or
modification of a
Mortgage Loan and (b) any other documents required to be delivered
by the
Depositor or the Servicer to the Trustee. If the original Mortgage
is not
delivered and in connection with the payment in full of the related
Mortgage
Loan the public recording office requires the presentation of a
"lost
instruments affidavit and indemnity" or any equivalent document,
because only
a copy of the Mortgage can be delivered with the instrument of
satisfaction or
reconveyance, the Servicer shall execute and deliver the required
document to
the public recording office. If a public recording office retains
the original
recorded Mortgage or if a Mortgage is lost after recordation in a
public
recording office, the Seller shall deliver to the Trustee a copy of
the
Mortgage certified by the public recording office to be a true and
complete
copy of the original recorded Mortgage.
As
promptly as practicable after any transfer of a Mortgage Loan
under
this Agreement, and in any event within thirty days after the
transfer, the
Trustee shall (i) affix the Trustee's name to each assignment of
Mortgage, as
its assignee, and (ii) cause to be delivered for recording in the
appropriate
public office for real property records the assignments of the
Mortgages to
the Trustee, except that, if the Trustee has not received the
information
required to deliver any assignment of a Mortgage for recording, the
Trustee
shall deliver it as soon as practicable after receipt of the
needed
information and in any event within thirty days.
The
Trustee need not record any assignment that relates to a
Mortgage
Loan (a) the Mortgaged Property and Mortgage File relating to which
are
located in California or (b) in any other jurisdiction
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(including Puerto Rico) under the laws of which, as evidenced by an
Opinion of
Counsel delivered by the Seller (at the Seller's expense) to the
Trustee,
recording the assignment is not necessary to protect the Trustee's
and the
Certificateholders' interest in the related Mortgage Loan. The
Seller shall
deliver such Opinion of Counsel within 90 days of the Closing
Date.
If
any Mortgage Loans have been prepaid in full as of the Closing
Date,
the Depositor, in lieu of delivering the above documents to the
Trustee, will
deposit in the Certificate Account the portion of the prepayment
that is
required to be deposited in the Certificate Account pursuant to
Section 3.06.
Notwithstanding anything to the contrary in this Agreement, within
five
Business Days after the Closing Date, the Seller shall either
(x) deliver to the Trustee the Mortgage File as required pursuant
to
this Section 2.01 for each Delay Delivery Mortgage Loan or
(y) (A) repurchase the Delay Delivery Mortgage Loan or (B)
substitute the Substitute Mortgage Loan for a Delay Delivery
Mortgage Loan, which repurchase or substitution shall be
accomplished in the manner and subject to the conditions in
Section
2.03 (treating each such Delay Delivery Mortgage Loan as a
Deleted
Mortgage Loan for purposes of such Section 2.03);
provided, however, that if the Seller fails to deliver a Mortgage
File for any
Delay Delivery Mortgage Loan within the period specified herein,
the Seller
shall use its best reasonable efforts to effect a substitution,
rather than a
repurchase of, such Deleted Mortgage Loan and provided further that
the cure
period provided for in Section 2.02 or in Section 2.03 shall not
apply to the
initial delivery of the Mortgage File for such Delay Delivery
Mortgage Loan,
but rather the Seller shall have five (5) Business Days to cure
such failure
to deliver. At the end of such period, the Trustee shall send a
Delay Delivery
Certification for the Delay Delivery Mortgage Loans delivered
during such
period in accordance with the provisions of Section 2.02.
(d) The Seller agrees to treat the transfer of the Mortgage Loans
to
the
Depositor as a sale for all tax, accounting, and regulatory
purposes.
(e) It is agreed and understood by the parties hereto that it is
not
intended that any Mortgage Loan be included in the Trust Fund that
is a
"High-Cost Home Loan" (or any other similarly designated loan) as
defined
in
the New Jersey Home Ownership Act effective November 27, 2003,
the
Home
Loan Protection Act of New Mexico, effective January 1, 2004 or
the
Indiana Home Loan Practices Act effective January 1, 2005."
Section 2.02 Acceptance by the Trustee of the Mortgage Loans.
The
Trustee acknowledges receipt of the documents identified in the
Initial Certification in the form of Exhibit G-1, and declares that
it holds
and will hold such documents and the other documents delivered to
it
constituting the Mortgage Files for the Mortgage Loans, and that it
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
Trustee acknowledges that it will maintain possession of the
related
Mortgage Notes in the State of California, unless otherwise
permitted by the
Rating Agencies. The Trustee agrees to execute and deliver on the
Closing Date
to the Depositor, the Servicer and the Seller an Initial
Certification in the
form of Exhibit G-1. Based on its review and examination, and only
as to the
documents identified in
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such Initial Certification, the Trustee acknowledges that such
documents
appear regular on their face and relate to such Mortgage Loans. The
Trustee
shall be under no duty or obligation to inspect, review or examine
said
documents, instruments, certificates or other papers to determine
that the
same are genuine, enforceable or appropriate for the represented
purpose or
that they have actually been recorded in the real estate records or
that they
are other than what they purport to be on their face.
By
the thirtieth day after the Closing Date (or if that day is not
a
Business Day, the succeeding Business Day), the Trustee shall
deliver to the
Depositor, the Servicer, and the Seller a Delay Delivery
Certification with
respect to the Mortgage Loans substantially in the form of Exhibit
G-2, with
any applicable exceptions noted thereon.
By
the ninetieth day after the Closing Date (or if that day is not
a
Business Day, the succeeding Business Day), the Trustee shall
deliver to the
Depositor, the Servicer and the Seller a Final Certification with
respect to
the Mortgage Loans in the form of Exhibit H, with any applicable
exceptions
noted thereon.
If,
in the course of its review, the Trustee finds any document
constituting a part of a Mortgage File that does not meet the
requirements of
Section 2.01, the Trustee shall list such as an exception in the
Final
Certification. The Trustee shall not make any determination as to
whether (i)
any endorsement is sufficient to transfer all interest of the party
so
endorsing, as noteholder or assignee thereof, in that Mortgage Note
or (ii)
any assignment is in recordable form or is sufficient to effect the
assignment
of and transfer to the assignee thereof under the mortgage to which
the
assignment relates. The Seller shall promptly correct any defect
that
materially and adversely affects the interests of the
Certificateholders
within 90 days from the date it was so notified of the defect and,
if the
Seller does not correct the defect within that period, the Seller
shall either
(a) substitute for the related Mortgage Loan a Substitute Mortgage
Loan, which
substitution shall be accomplished in the pursuant Section 2.03, or
(b)
purchase the Mortgage Loan at its Purchase Price from the Trustee
within 90
days from the date the Seller was notified of the defect in
writing.
If a
substitution or purchase of a Mortgage Loan pursuant to this
provision is required because of a delay in delivery of any
documents by the
appropriate recording office, or there is a dispute between either
the
Servicer or the Seller and the Trustee over the location or status
of the
recorded document, then the substitution or purchase shall occur
within 720
days from the Closing Date. In no other case may a substitution or
purchase
occur more than 540 days from the Closing Date.
The
Trustee shall deliver written notice to each Rating Agency within
270
days from the Closing Date indicating each Mortgage Loan (a) that
has not been
returned by the appropriate recording office or (b) as to which
there is a
dispute as to location or status of the Mortgage Loan. The notice
shall be
delivered every 90 days thereafter until the related Mortgage Loan
is returned
to the Trustee. Any substitution pursuant to (a) above or purchase
pursuant to
(b) above shall not be effected before the delivery to the Trustee
of the
Opinion of Counsel required by Section 2.05, and any substitution
pursuant to
(a) above shall not be effected before the additional delivery to
the Trustee
of a Request for Release substantially in the form of Exhibit N.
No
substitution is permitted to be made in any calendar month after
the
Determination Date for the month.
The
Purchase Price for any Mortgage Loan shall be deposited by the
Seller
in the Certificate Account by the Distribution Account Deposit Date
for the
Distribution Date in the month following the month of repurchase
and, upon
receipt of the deposit and certification with respect thereto in
the form of
Exhibit N, the Trustee shall release the related Mortgage File to
the Seller
and shall execute and deliver at the Seller's request any
instruments of
transfer or assignment prepared by the Seller, in each case
without
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recourse, necessary to vest in the Seller, or a designee, the
Trustee's
interest in any Mortgage Loan released pursuant hereto.
If
pursuant to the foregoing provisions the Seller repurchases a
Mortgage
Loan that is a MERS Mortgage Loan, the Servicer shall either (i)
cause MERS to
execute and deliver an assignment of the Mortgage in recordable
form to
transfer the Mortgage from MERS to the Seller and shall cause such
Mortgage to
be removed from registration on the MERS(R) System in accordance
with MERS'
rules and regulations or (ii) cause MERS to designate on the
MERS(R) System
the Seller as the beneficial holder of such Mortgage Loan.
The
Trustee shall retain possession and custody of each Mortgage File
in
accordance with and subject to the terms and conditions set forth
herein. The
Servicer shall promptly deliver to the Trustee, upon the execution
or receipt
thereof, the originals of any other documents or instruments
constituting the
Mortgage File that come into the possession of the Servicer from
time to time.
Section 2.03 Representations, Warranties, and Covenants of the
Seller and
the Servicer.
(a)
IndyMac, in its capacities as Seller and Servicer, makes the
representations and warranties in Schedule II, and by this
reference
incorporated in this Agreement, to the Depositor and the Trustee,
as of the
Closing Date.
(b)
The Seller, in its capacity as Seller, makes the representations
and
warranties in Schedule III, and by this reference incorporated in
this
Agreement, to the Depositor and the Trustee, as of the Closing
Date, or if so
specified in Schedule III, as of the Cut-off Date.
(c)
Upon discovery by any of the parties hereto of a breach of a
representation or warranty made pursuant to Section 2.03(b) that
materially
and adversely affects the interests of the Certificateholders in
any Mortgage
Loan, the party discovering such breach shall give prompt notice
thereof to
the other parties. The Seller covenants that within 90 days of the
earlier of
its discovery or its receipt of written notice from any party of a
breach of
any representation or warranty made pursuant to Section 2.03(b)
which
materially and adversely affects the interests of the
Certificateholders in
any Mortgage Loan, it shall cure such breach in all material
respects, and if
such breach is not so cured, shall, (i) if the 90-day period
expires before
the second anniversary of the Closing Date, remove the Mortgage
Loan (a
"Deleted Mortgage Loan") from the Trust Fund and substitute in its
place a
Substitute Mortgage Loan, in accordance with this Section 2.03; or
(ii)
repurchase the affected Mortgage Loan or Mortgage Loans from the
Trustee at
the Purchase Price in the manner set forth below. Any substitution
pursuant to
(i) above shall not be effected before the delivery to the Trustee
of the
Opinion of Counsel required by Section 2.05 and a Request for
Release
substantially in the form of Exhibit N, and the Mortgage File for
any
Substitute Mortgage Loan. The Seller shall promptly reimburse the
Servicer and
the Trustee for any expenses reasonably incurred by the Servicer or
the
Trustee in respect of enforcing the remedies for the breach.
With
respect to any Substitute Mortgage Loan or Loans, the Seller
shall
deliver to the Trustee for the benefit of the Certificateholders
the Mortgage
Note, the Mortgage, the related assignment of the Mortgage, and
such other
documents and agreements as are required by Section 2.01, with the
Mortgage
Note endorsed and the Mortgage assigned as required by Section
2.01. No
substitution is permitted to be made in any calendar month after
the
Determination Date for such month. Scheduled Payments due with
respect to
Substitute Mortgage Loans in the month of substitution shall not be
part of
the Trust Fund and will be retained by the Seller on the next
succeeding
Distribution Date. For the month of substitution, distributions
to
Certificateholders will include the monthly payment due on any
Deleted
Mortgage Loan
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for such month and thereafter the Seller shall be entitled to
retain all
amounts received in respect of such Deleted Mortgage Loan.
The
Servicer shall amend the Mortgage Loan Schedule for the benefit
of
the Certificateholders to reflect the removal of the Deleted
Mortgage Loan and
the substitution of the Substitute Mortgage Loans and the Servicer
shall
deliver the amended Mortgage Loan Schedule to the Trustee. Upon
the
substitution, the Substitute Mortgage Loans shall be subject to
this Agreement
in all respects, and the Seller shall be deemed to have made with
respect to
the Substitute Mortgage Loans, as of the date of substitution,
the
representations and warranties made pursuant to Section 2.03(b)
with respect
to the Mortgage Loan. Upon any substitution and the deposit to the
Certificate
Account of the amount required to be deposited therein in
connection with the
substitution as described in the following paragraph, the Trustee
shall
release the Mortgage File held for the benefit of the
Certificateholders
relating to the Deleted Mortgage Loan to the Seller and shall
execute and
deliver at the Seller's direction such instruments of transfer or
assignment
prepared by the Seller, in each case without recourse, as shall be
necessary
to vest title in the Seller, or its designee, the Trustee's
interest in any
Deleted Mortgage Loan substituted for pursuant to this Section
2.03.
For
any month in which the Seller 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 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 monthly
payments due in
the month of substitution). The amount of such shortage (the
"Substitution
Adjustment Amount") plus, if the Seller is not the Servicer, an
amount equal
to the aggregate of any unreimbursed Advances and Servicer Advances
with
respect to such Deleted Mortgage Loans shall be deposited into the
Certificate
Account by the Seller by the Distribution Account Deposit Date for
the
Distribution Date in the month succeeding the calendar month during
which the
related Mortgage Loan became required to be purchased or replaced
hereunder.
If the Seller repurchases a Mortgage Loan, the Purchase Price
therefor shall
be deposited in the Certificate Account pursuant to Section 3.06 by
the
Distribution Account Deposit Date for the Distribution Date in the
month
following the month during which the Seller became obligated
hereunder to
repurchase or replace the Mortgage Loan and upon such deposit of
the Purchase
Price and receipt of a Request for Release in the form of Exhibit
N, the
Trustee shall release the related Mortgage File held for the
benefit of the
Certificateholders to such Person, 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. 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 shall constitute the sole remedy
against the
Person respecting the breach available to Certificateholders, the
Depositor,
or the Trustee on their behalf.
The
representations and warranties made pursuant to this Section
2.03
shall survive delivery of the respective Mortgage Files to the
Trustee for the
benefit of the Certificateholders.
Section 2.04 Representations and Warranties of the Depositor as to
the
Mortgage Loans.
(a)
The Depositor represents and warrants to the Trustee with respect
to
each Mortgage Loan as of the date of this Agreement or such other
date set
forth in this Agreement that as of the Closing Date, and following
the
transfer of the Mortgage Loans to it by the Seller, the Depositor
had good
title to the Mortgage Loans and the Mortgage Notes were subject to
no offsets,
defenses, or counterclaims.
(b)
The representations and warranties in this Section 2.04 shall
survive
delivery of the Mortgage Files to the Trustee. Upon discovery by
the Depositor
or the Trustee of any breach of any of
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the representations and warranties in this Section that materially
and
adversely affects the interest of the Certificateholders, the
party
discovering the breach shall give prompt written notice to the
others and to
each Rating Agency.
Section 2.05 Delivery of Opinion of Counsel in Connection with
Substitutions.
(a)
Notwithstanding any contrary provision of this Agreement, no
substitution pursuant to Section 2.02 or 2.03 shall be made more
than 90 days
after the Closing Date unless the Seller delivers to the Trustee an
Opinion of
Counsel, which Opinion of Counsel shall not be at the expense of
either the
Trustee or the Trust Fund, addressed to the Trustee, to the effect
that such
substitution will not (i) result in the imposition of the tax on
"prohibited
transactions" on the Trust Fund or contributions after the Startup
Date, as
defined in sections 860F(a)(2) and 860G(d) of the Code,
respectively or (ii)
cause any REMIC created under this Agreement to fail to qualify as
a REMIC at
any time that any Certificates are outstanding.
(b)
Upon discovery by the Depositor, the Seller, the Servicer or
the
Trustee that any Mortgage Loan does not constitute a "qualified
mortgage"
within the meaning of section 860G(a)(3) of the Code, the party
discovering
such fact shall promptly (and in any event within five Business
Days of
discovery) give written notice thereof to the other parties. In
connection
therewith, the Trustee shall require the Seller, at the Seller's
option, to
either (i) substitute, if the conditions in Section 2.03(c) with
respect to
substitutions are satisfied, a Substitute Mortgage Loan for the
affected
Mortgage Loan, or (ii) repurchase the affected Mortgage Loan within
90 days of
such discovery 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 the Seller the Mortgage Loan to be released pursuant
hereto in the
same manner, and on the same terms and conditions, as it would a
Mortgage Loan
repurchased for breach of a representation or warranty contained in
Section
2.03.
Section 2.06 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 2.07 REMIC Matters.
The
Preliminary Statement sets forth the designations and "latest
possible maturity date" for federal income tax purposes of all
interests
created under this Agreement. The "Startup Day" for purposes of the
REMIC
Provisions shall be the Closing Date. Each REMIC's fiscal year
shall be the
calendar year.
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ARTICLE THREE
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 3.01 Servicer to Service Mortgage Loans.
For
and on behalf of the Certificateholders, the Servicer shall
service
and administer the Mortgage Loans in accordance with this Agreement
and the
Servicing Standard.
The
Servicer shall not make or permit any modification, waiver, or
amendment of any term of any Mortgage Loan that would cause any
REMIC created
under this Agreement to fail to qualify as a REMIC or result in the
imposition
of any tax under section 860F(a) or section 860G(d) of the
Code.
Without limiting the generality of the foregoing, the Servicer, in
its
own name or in the name of the Depositor and the Trustee, is hereby
authorized
and empowered by the Depositor and the Trustee, when the Servicer
believes it
appropriate in its reasonable judgment, to execute and deliver, on
behalf of
the Trustee, the Depositor, the Certificateholders, or any of them,
any
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 with respect to the Mortgaged Properties held for the
benefit of
the Certificateholders. The Servicer shall prepare and deliver to
the
Depositor or the Trustee any documents requiring execution and
delivery by
either or both of them appropriate to enable the Servicer to
service and
administer the Mortgage Loans to the extent that the Servicer is
not permitted
to execute and deliver such documents pursuant to the preceding
sentence. Upon
receipt of the documents, the Depositor or the Trustee shall
execute the
documents and deliver them to the Servicer.
The
Servicer further is authorized and empowered by the Trustee, on
behalf of the Certificateholders and the Trustee, in its own name
when the
Servicer believes it appropriate in its best judgment to register
any Mortgage
Loan on the MERS(R) System, or cause the removal from the
registration of any
Mortgage Loan on the MERS(R) System, to execute and deliver, on
behalf of the
Trustee and the Certificateholders or any of them, any and all
instruments of
assignment and other comparable instruments with respect to such
assignment or
re-recording of a Mortgage in the name of MERS, solely as nominee
for the
Trustee and its successors and assigns.
In
accordance with and to the extent of the Servicing Standard,
the
Servicer shall advance funds necessary to effect the payment of
taxes and
assessments on the Mortgaged Properties, which advances shall be
reimbursable
in the first instance from related collections from the Mortgagors
pursuant to
Section 3.07, and further as provided in Section 3.09. The costs
incurred by
the Servicer in effecting the timely payments of taxes and
assessments on the
Mortgaged Properties and related insurance premiums shall not, for
the purpose
of calculating monthly distributions to the Certificateholders, be
added to
the Stated Principal Balances of the related Mortgage Loans,
notwithstanding
that the Mortgage Loans so permit.
Nothing in this Agreement to the contrary shall limit the Servicer
from
undertaking any legal action that it may deem appropriate with
respect to the
Mortgage Loans including, without limitation, any rights or causes
of actions
arising out of the origination of the Mortgage Loans.
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<PAGE>
Section 3.02 [Reserved].
Section 3.03 Rights of the Depositor and the Trustee in Respect of
the
Servicer.
The
Depositor may, but is not obligated to, enforce the obligations
of
the Servicer under this Agreement and may, but is not obligated to,
perform,
or cause a designee to perform, any defaulted obligation of the
Servicer under
this Agreement and in connection with any such defaulted obligation
to
exercise the related rights of the Servicer under this Agreement;
provided
that the Servicer shall not be relieved of any of its obligations
under this
Agreement by virtue of such performance by the Depositor or its
designee.
Neither the Trustee nor the Depositor shall have any responsibility
or
liability for any action or failure to act by the Servicer nor
shall the
Trustee or the Depositor be obligated to supervise the performance
of the
Servicer under this Agreement or otherwise.
Section 3.04 [Reserved].
Section 3.05 Trustee to Act as Servicer.
If
the Servicer for any reason is no longer the Servicer under
this
Agreement (including because of the occurrence or existence of an
Event of
Default or termination by the Depositor), the Trustee or its
successor shall
assume all of the rights and obligations of the Servicer under this
Agreement
arising thereafter (except that the Trustee shall not be
(i) liable for losses of the 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 repurchases or substitutions
pursuant
to
Section 2.02 or 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 assumption shall be subject to Section
7.02.
Notwithstanding anything else in this Agreement to the contrary, in
no
event shall the Trustee be liable for any servicing fee or for
any
differential in the amount of the Servicing Fee paid under this
Agreement and
the amount necessary to induce any successor Servicer to act as
successor
Servicer under this Agreement and the transactions provided for in
this
Agreement.
Section 3.06 Collection of Mortgage Loan Payments; Certificate
Account;
Distribution Account.
(a) In accordance with and to the extent of the Servicing
Standard,
the
Servicer shall make reasonable efforts in accordance with the
customary and usual standards of practice of prudent mortgage
servicers
to
collect all payments called for under the Mortgage Loans to the
extent
the
procedures are consistent with this Agreement and any related
Required Insurance Policy. Consistent with the foregoing, the
Servicer
may
in its discretion (i) waive any late payment charge or, subject
to
Section 3.20, any Prepayment Charge in connection with the
prepayment of
a
Mortgage Loan and (ii) extend the due dates for payments due on
a
Delinquent Mortgage Loan for a period not greater than 125 days.
In
connection with a seriously
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delinquent or defaulted Mortgage Loan, the Servicer may, consistent
with
the
Servicing Standard, waive, modify or vary any term of that
Mortgage
Loan
(including modifications that change the Mortgage Rate, forgive
the
payment of principal or interest or extend the final maturity date
of
that
Mortgage Loan ), accept payment from the related Mortgagor of
an
amount less than the Stated Principal Balance in final satisfaction
of
that
Mortgage Loan, or consent to the postponement of strict
compliance
with
any such term or otherwise grant indulgence to any Mortgagor if
in
the Servicer's determination
such waiver, modification, postponement or
indulgence is not materially adverse to the interests of the
Certificateholders (taking into account any estimated loss that
might
result absent such action) and is expected to minimize the loss on
such
Mortgage Loan; provided, however, the Servicer shall not initiate
new
lending to such Mortgagor through the Trust and cannot, except
as
provided in the immediately succeeding sentence, extend the
maturity of
any
Mortgage Loan past the date on which the final payment is due on
the
latest maturing Mortgage Loan as of the Cut-off Date. With respect
to no
more
than 5% of the Mortgage Loans (measured by aggregate Cut-off
Date
Principal Balance of the Mortgage Loans), the Servicer may extend
the
maturity of a Mortgage Loan past the date on which the final
payment is
due
on the latest maturing Mortgage Loan as of the Cut-off Date, but
in
no
event more than one year past such date. In the event of any
such
arrangement, the Servicer shall make Advances on the related
Mortgage
Loan
in accordance with Section 4.01 during the scheduled period in
accordance with the amortization schedule of the Mortgage Loan
without
modification thereof because of the arrangements. The Servicer
shall not
be
required to institute or join in litigation with respect to
collection
of
any payment (whether under a Mortgage, Mortgage Note, or otherwise
or
against any public or governmental authority with respect to a
taking or
condemnation) if it reasonably believes that enforcing the
provision of
the
Mortgage or other instrument pursuant to which the payment is
required is prohibited by applicable law. The Servicer shall not
have the
discretion to sell any Delinquent or defaulted Mortgage Loan.
(b) [Reserved].
(c) [Reserved].
(d) The Servicer shall establish and maintain a Certificate
Account
into
which the Servicer shall deposit on a daily basis (1) within
two
Business Days of receipt (in the case of items (i) through (iii)
below)
and
(2) within one Business Day of receipt (in the case of all
other
items), except as otherwise specified herein, the following
payments and
collections received by it in respect of Mortgage Loans after the
Cut-off
Date
(other than in respect of principal and interest due on the
Mortgage
Loans by the Cut-off Date) and the following amounts required to
be
deposited hereunder:
(i) all payments on account of principal on the Mortgage Loans,
including Principal Prepayments;
(ii) all payments on account of interest on the Mortgage Loans,
net
of
the Servicing Fee;
(iii) all Insurance Proceeds, Subsequent Recoveries and
Liquidation
Proceeds, other than proceeds to be applied to the restoration or
repair
of
the Mortgaged Property or released to the Mortgagor in accordance
with
the
Servicer's normal servicing procedures;
(iv) any amount required to be deposited by the Servicer pursuant
to
Section 3.06(f) in connection with any losses on Permitted
Investments;
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(v) any amounts required to be deposited by the Servicer pursuant
to
Sections 3.10 and 3.12;
(vi) all Purchase Prices from the Servicer or Seller and all
Substitution Adjustment Amounts;
(vii) all Advances made by the Servicer pursuant to Section
4.01;
(viii) any other amounts required to be deposited under this
Agreement; and
(ix) all Prepayment Charges collected.
In
addition, with respect to any Mortgage Loan that is subject to
a
buydown agreement, on each Due Date for the Mortgage Loan, in
addition to the
monthly payment remitted by the Mortgagor, the Servicer shall cause
funds to
be deposited into the Certificate Account in an amount required to
cause an
amount of interest to be paid with respect to the Mortgage Loan
equal to the
amount of interest that has accrued on the Mortgage Loan from the
preceding
Due Date at the Mortgage Rate net of the Servicing Fee Rate on that
date.
The
foregoing requirements for remittance by the Servicer shall be
exclusive, it being understood and agreed that, without limiting
the
generality of the foregoing, payments in the nature of late payment
charges or
assumption fees, if collected, need not be remitted by the
Servicer. If the
Servicer remits any amount not required to be remitted, it may at
any time
withdraw that amount from the Certificate Account, any provision in
this
Agreement to the contrary notwithstanding. The withdrawal or
direction may be
accomplished by delivering written notice of it to the Trustee or
any other
institution maintaining the Certificate Account that describes the
amounts
deposited in error in the Certificate Account. The Servicer shall
maintain
adequate records with respect to all withdrawals made pursuant to
this Section
3.06. All funds deposited in the Certificate Account shall be held
in trust
for the Certificateholders until withdrawn in accordance with
Section 3.09.
(e) The Trustee shall establish and maintain the Distribution
Account on behalf of the Certificateholders. The Trustee shall,
promptly
upon
receipt, deposit in the Distribution Account and retain in the
Distribution Account the following:
(i) the aggregate amount remitted by the Servicer to the
Trustee
pursuant to Section 3.09(a);
(ii) any amount deposited by the Servicer pursuant to Section
3.06(f) in connection with any losses on Permitted Investments;
and
(iii) any other amounts deposited under this Agreement that are
required to be deposited in the Distribution Account.
If
the Servicer remits any amount not required to be remitted, it may
at
any time direct the Trustee in writing to withdraw that amount from
the
Distribution Account, any provision in this Agreement to the
contrary
notwithstanding. The direction may be accomplished by delivering an
Officer's
Certificate to the Trustee that 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 3.09. In no event shall the Trustee incur liability for
withdrawals
from the Distribution Account at the direction of the Servicer.
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<PAGE>
(f) Each institution at which the Certificate Account is
maintained
shall invest the funds in such account as directed in writing by
the
Servicer in Permitted Investments, which shall mature not later
than the
second Business Day
preceding the related Distribution Account Deposit
Date
(except that if the Permitted Investment is an obligation of
the
institution that maintains the account, then the Permitted
Investment
shall mature not later than the Business Day preceding the
Distribution
Account Deposit Date) and which shall not be sold or disposed of
before
its
maturity. The funds in the Distribution Account shall remain
uninvested. All such Permitted Investments shall be made in the
name of
the
Trustee, for the benefit of the Certificateholders. All income
realized from any such investment of funds on deposit in the
Certificate
Account shall be for the benefit of the Servicer as servicing
compensation and shall be remitted to it monthly as provided in
this
Agreement. The amount of any realized losses on Permitted
Investments in
the
Certificate Account shall promptly be deposited by the Servicer
in
the
Certificate Account. The Trustee shall not be liable for the
amount
of
any loss incurred in respect of any investment or lack of
investment
of
funds held in the Certificate Account and made in accordance with
this
Section 3.06.
(g) [reserved].
(h) [reserved].
(i) The Servicer shall give notice to the Trustee, the Seller,
each
Rating Agency and the Depositor of any proposed change of the
location of
the
Certificate Account not later than 30 days and not more than 45
days
prior to any change of this Agreement. The Trustee shall give
notice to
the
Servicer, the Seller, each Rating Agency and the Depositor of
any
proposed change of the location of the Distribution Account not
later
than
30 days and not more than 45 days prior to any change of this
Agreement.
Section 3.07 Collection of Taxes, Assessments and Similar Items;
Escrow
Accounts.
(a) To the extent required by the related Mortgage Note and not
violative of current law, the Servicer shall establish and maintain
one
or
more accounts (each, an "Escrow Account") and deposit and
retain
therein all collections from the Mortgagors (or advances) for the
payment
of
taxes, assessments, hazard insurance premiums or comparable items
for
the
account of the Mortgagors. Nothing herein shall require the
Servicer
to
compel a Mortgagor to establish an Escrow Account in violation
of
applicable law.
(b) Withdrawals of amounts so collected from the Escrow Accounts
may
be
made only to effect timely payment of taxes, assessments,
hazard
insurance premiums, condominium or PUD association dues, or
comparable
items, to reimburse (without duplication) the Servicer out of
related
collections for any payments made pursuant to Section 3.01 (with
respect
to
taxes and assessments and insurance premiums) and Section 3.10
(with
respect to hazard insurance), to refund to any Mortgagors any
sums
determined to be overages, to pay interest, if required by law or
the
related Mortgage or Mortgage Note, to Mortgagors on balances in
the
Escrow Account or to clear and terminate the Escrow Account at
the
termination of this Agreement in accordance with Section 9.01. The
Escrow
Accounts shall not be a part of the Trust Fund.
(c) The Servicer shall advance any payments referred to in
Section
3.07(a) that are not timely paid by the Mortgagors or advanced by
the
Servicer on the date when the tax, premium or other cost for which
such
payment is intended is
due, but the Servicer shall be required so to
advance only to the extent that such advances, in the good faith
judgment
of
the Servicer, will be recoverable by the Servicer out of
Insurance
Proceeds, Liquidation Proceeds or otherwise.
47
<PAGE>
Section 3.08 Access to Certain Documentation and Information
Regarding
the Mortgage Loans.
The
Servicer shall afford the Depositor and the Trustee reasonable
access
to all records and documentation regarding the Mortgage Loans and
all
accounts, insurance information and other matters relating to this
Agreement,
such access being afforded without charge, but only upon reasonable
request
and during normal business hours at the office designated by the
Servicer.
Upon
reasonable advance notice in writing, the Servicer will provide
to
each Certificateholder or Certificate Owner that is a savings and
loan
association, bank, or insurance company certain reports and
reasonable access
to information and documentation regarding the Mortgage Loans
sufficient to
permit the Certificateholder or Certificate Owner to comply with
applicable
regulations of the OTS or other regulatory authorities with respect
to
investment in the Certificates. The Servicer shall be entitled to
be
reimbursed by each such Certificateholder or Certificate Owner for
actual
expenses incurred by the Servicer in providing the reports and
access.
Section 3.09 Permitted Withdrawals from the Certificate Account and
the
Distribution Account.
(a) The Servicer may (and, in the case of clause (ix) below,
shall)
from
time to time make withdrawals from the Certificate Account for
the
following purposes:
(i) to pay to the Servicer (to the extent not previously
retained)
the
servicing compensation to which it is entitled pursuant to
Section
3.15, and to pay to the Servicer, as additional servicing
compensation,
earnings on or investment income with respect to funds in or
credited to
the
Certificate Account;
(ii) to reimburse the Servicer or successor Servicer for the
unreimbursed Advances made by it, such right of reimbursement
pursuant to
this
subclause (ii) being limited to amounts received on the
Mortgage
Loans in respect of which the Advance was made;
(iii) to reimburse the Servicer or successor Servicer for any
Nonrecoverable Advance previously made by it;
(iv) to reimburse the Servicer for Insured Expenses from the
related
Insurance Proceeds;
(v) to reimburse the Servicer for (a) unreimbursed Servicing
Advances, the Servicer's right to reimbursement pursuant to this
clause
(a)
with respect to any Mortgage Loan being limited to amounts
received
on
the Mortgage Loans that represent late recoveries of the payments
for
which the advances were made pursuant to Section 3.01 or Section
3.07,
(b)
unreimbursed Servicing Advances made in respect of a Mortgage
Loan
for
which such Servicing Advances are not recoverable from the
Mortgagor
and
(b) for unpaid Servicing Fees as provided in Section 3.12;
(vi) to pay to the purchaser, with respect to each Mortgage Loan
or
property acquired in respect of such Mortgage Loan that has
been
purchased pursuant to Section 2.02, 2.03, or 3.12, all amounts
received
thereon after the date of such purchase;
(vii) to reimburse the Seller, the Servicer, or the Depositor
for
expenses incurred by any of them and reimbursable pursuant to
Section
6.03;
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<PAGE>
(viii) to withdraw any amount deposited in the Certificate
Account
and
not required to be deposited in the Certificate Account;
(ix) by the Distribution Account Deposit Date, to withdraw (1)
the
Available Funds and the Trustee Fee for the Distribution Date, to
the
extent on deposit, and (2) the Prepayment Charges on deposit, and
remit
such
amount to the Trustee for deposit in the Distribution Account;
and
(x) to clear and terminate the Certificate Account upon
termination
of
this Agreement pursuant to Section 9.01.
The
Servicer shall keep and maintain separate accounting, on a
Mortgage
Loan by Mortgage Loan basis, to justify any withdrawal from the
Certificate
Account pursuant to subclauses (i), (ii), (iv), (v), and (vi).
Before making
any withdrawal from the Certificate Account pursuant to subclause
(iii), the
Servicer shall deliver to the Trustee an Officer's Certificate of a
Servicing
Officer indicating the amount of any previous Advance determined by
the
Servicer to be a Nonrecoverable Advance and identifying the related
Mortgage
Loans and their respective portions of the Nonrecoverable
Advance.
(b) The Trustee shall withdraw funds from the Distribution
Account
for
distributions to Certificateholders in the manner specified in
this
Agreement (and to withhold from the amounts so withdrawn the amount
of
any
taxes that it is authorized to withhold pursuant to the last
paragraph of Section 8.11). In addition, the Trustee may from time
to
time
make withdrawals from the Distribution Account for the
following
purposes:
(i) to pay to itself the Trustee Fee for the related
Distribution
Date;
(ii) to withdraw and return to the Servicer any amount deposited
in
the
Distribution Account and not required to be deposited therein;
and
(iii) to clear and terminate the Distribution Account upon
termination of the Agreement pursuant to Section 9.01.
Section 3.10 Maintenance of Hazard Insurance; Maintenance of
Primary
Insurance Policies.
(a) The Servicer shall maintain, for each Mortgage Loan, hazard
insurance with extended coverage in an amount that is at least
equal to
the
lesser of
(i)
the maximum insurable value of the improvements securing the
Mortgage
Loan and
(ii)
the greater of (y) the outstanding principal balance of the
Mortgage
Loan and (z) an amount such that the proceeds of the policy are
sufficient to
prevent the Mortgagor or the mortgagee from becoming a
co-insurer.
Each
policy of standard hazard insurance shall contain, or have an
accompanying endorsement that contains, a standard mortgagee
clause. Any
amounts collected under the policies (other than the amounts to be
applied to
the restoration or repair of the related Mortgaged Property or
amounts
released to the Mortgagor in accordance with the Servicer's normal
servicing
procedures) shall be deposited in the Certificate Account. Any cost
incurred
in maintaining any insurance shall not, for the purpose of
calculating monthly
distributions to the Certificateholders or remittances to the
Trustee for
their benefit, be added to the principal balance of the Mortgage
Loan,
notwithstanding that the Mortgage Loan so
49
<PAGE>
permits. Such costs shall be recoverable by the Servicer out of
late payments
by the related Mortgagor or out of Liquidation Proceeds to the
extent
permitted by Section 3.09. No earthquake or other additional
insurance is to
be required of any Mortgagor or maintained on property acquired in
respect of
a Mortgage other than pursuant to any applicable laws and
regulations in force
that require additional insurance. If the Mortgaged Property is
located at the
time of origination of the Mortgage Loan in a federally designated
special
flood hazard area and the area is participating in the national
flood
insurance program, the Servicer shall maintain flood insurance for
the
Mortgage Loan. The flood insurance shall be in an amount equal to
the least of
(i) the original principal balance of the related Mortgage Loan,
(ii) the
replacement value of the improvements that are part of the
Mortgaged Property,
and (iii) the maximum amount of flood insurance available for the
related
Mortgaged Property under the national flood insurance program.
If
the Servicer obtains and maintains a blanket policy insuring
against
hazard losses on all of the Mortgage Loans, it shall have satisfied
its
obligations in the first sentence of this Section 3.10. The policy
may contain
a deductible clause on terms substantially equivalent to those
commercially
available and maintained by comparable servicers. If the policy
contains a
deductible clause and a policy complying with the first sentence of
this
Section 3.10 has not been maintained on the related Mortgaged
Property, and if
a loss that would have been covered by the required policy occurs,
the
Servicer shall deposit in the Certificate Account, without any
right of
reimbursement, the amount not otherwise payable under the blanket
policy
because of the deductible clause. In connection with its activities
as
Servicer of the Mortgage Loans, the Servicer agrees to present, on
behalf of
itself, the Depositor, and the Trustee for the benefit of the
Certificateholders, claims under any blanket policy.
(b) The Servicer shall not take any action that would result in
non-coverage under any applicable Primary Insurance Policy of any
loss
that, but for the actions of the Servicer, would have been
covered
thereunder. The Servicer shall not cancel or refuse to renew any
Primary
Insurance Policy that is in effect at the date of the initial
issuance of
the
Certificates and is required to be kept in force hereunder unless
the
replacement Primary Insurance Policy for the canceled or
non-renewed
policy is maintained with a Qualified Insurer. The Servicer need
not
maintain any Primary Insurance Policy if maintaining the
Primary
Insurance Policy is prohibited by applicable law. The Servicer
agrees, to
the
extent permitted by applicable law, to effect the timely payment
of
the
premiums on each Primary Insurance Policy, and any costs not
otherwise recoverable shall be recoverable by the Servicer from
the
related liquidation proceeds.
In
connection with its activities as Servicer of the Mortgage Loans,
the
Servicer agrees to present, on behalf of itself, the Trustee and
the
Certificateholders, claims to the insurer under any Primary
Insurance Policies
and, in this regard, to take any reasonable action in accordance
with the
Servicing Standard necessary to permit recovery under any Primary
Insurance
Policies respecting defaulted Mortgage Loans. Any amounts collected
by the
Servicer under any Primary Insurance Policies shall be deposited in
the
Certificate Account.
Section 3.11 Enforcement of Due-On-Sale Clauses; Assumption
Agreements.
(a) Except as
otherwise provided in this Section 3.11, when any
property subject to a Mortgage has been conveyed by the Mortgagor,
the
Servicer shall to the extent that it has knowledge of the
conveyance and
in
accordance with the Servicing Standard, enforce any due-on-sale
clause
contained in any Mortgage Note or Mortgage, to the extent permitted
under
applicable law and governmental regulations, but only to the extent
that
enforcement will not adversely affect or jeopardize coverage under
any
Required Insurance Policy. Notwithstanding the foregoing, the
Servicer is
not
required to exercise these rights with respect to a Mortgage Loan
if
the
Person to whom the related Mortgaged Property has been conveyed or
is
proposed to
50
<PAGE>
be
conveyed satisfies the conditions contained in the Mortgage Note
and
Mortgage related thereto and the consent of the mortgagee under
the
Mortgage Note or Mortgage is not otherwise so required under the
Mortgage
Note
or Mortgage as a condition to the transfer.
If
(i) the Servicer is prohibited by law from enforcing any
due-on-sale
clause, (ii) coverage under any Required Insurance Policy would be
adversely
affected, (iii) the Mortgage Note does not include a due-on-sale
clause, or
(iv) nonenforcement is otherwise permitted hereunder, the Servicer
is
authorized, subject to Section 3.11(b), to take or enter into an
assumption
and modification agreement from or with the person to whom the
property has
been or is about to be conveyed, pursuant to which the person
becomes liable
under the Mortgage Note and, unless prohibited by applicable state
law, the
Mortgagor remains liable thereon. The Mortgage Loan must continue
to be
covered (if so covered before the Servicer enters into the
agreement) by the
applicable Required Insurance Policies.
The
Servicer, subject to Section 3.11(b), is also authorized with
the
prior approval of the insurers under any Required Insurance
Policies to enter
into a substitution of liability agreement with the Person,
pursuant to which
the original Mortgagor is released from liability and the Person
is
substituted as Mortgagor and becomes liable under the Mortgage
Note.
Notwithstanding the foregoing, the Servicer shall not be deemed to
be in
default under this Section 3.11 because of any transfer or
assumption that the
Servicer reasonably believes it is restricted by law from
preventing, for any
reason whatsoever.
(b) Subject to the Servicer's duty to enforce any due-on-sale
clause
to
the extent set forth in Section 3.11(a), in any case in which a
Mortgaged Property has been conveyed to a Person by a Mortgagor,
and the
Person is to enter into an assumption agreement or modification
agreement
or
supplement to the Mortgage Note or Mortgage that requires the
signature of the Trustee, or if an instrument of release signed by
the
Trustee is required releasing the Mortgagor from liability on
the
Mortgage Loan, the Servicer shall prepare and deliver to the
Trustee for
signature and shall direct the Trustee, in writing, to execute
the
assumption agreement with the Person to whom the Mortgaged Property
is to
be
conveyed, and the modification agreement or supplement to the
Mortgage
Note
or Mortgage or other instruments appropriate to carry out the
terms
of
the Mortgage Note or Mortgage or otherwise to comply with any
applicable laws regarding assumptions or the transfer of the
Mortgaged
Property to the Person. In connection with any such assumption,
no
material term of the Mortgage Note may be changed.
In
addition, the substitute Mortgagor and the Mortgaged Property must
be
acceptable to the Servicer in accordance with its underwriting
standards as
then in effect. Together with each substitution, assumption, or
other
agreement or instrument delivered to the Trustee for execution by
it, the
Servicer shall deliver an Officer's Certificate signed by a
Servicing Officer
stating that the requirements of this subsection have been met in
connection
with such Officer's Certificate. The Servicer shall notify the
Trustee that
any substitution or assumption agreement has been completed by
forwarding to
the Trustee the original of the substitution or assumption
agreement, which in
the case of the original shall be added to the related Mortgage
File and
shall, for all purposes, be considered a part of the Mortgage File
to the same
extent as all other documents and instruments constituting a part
of the
Mortgage File. The Servicer will retain any fee collected by it for
entering
into an assumption or substitution of liability agreement as
additional
servicing compensation.
Section 3.12 Realization Upon Defaulted Mortgage Loans.
The
Servicer shall use reasonable efforts in accordance with the
Servicing Standard to foreclose on or otherwise comparably convert
the
ownership of assets securing such of the Mortgage Loans as come
into and
continue in default and as to which no satisfactory arrangements
can be made
for collection of delinquent payments. In connection with the
foreclosure or
other conversion, the Servicer shall follow
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<PAGE>
the Servicing Standard and shall follow the requirements of the
insurer under
any Required Insurance Policy. The Servicer shall not be required
to expend
its own funds in connection with any foreclosure or towards the
restoration of
any property unless it determines (i) that the restoration or
foreclosure will
increase the proceeds of liquidation of the Mortgage Loan after
reimbursement
to itself of restoration expenses and (ii) that restoration
expenses will be
recoverable to it through Liquidation Proceeds (respecting which it
shall have
priority for purposes of withdrawals from the Certificate Account).
The
Servicer shall be responsible for all other costs and expenses
incurred by it
in any foreclosure proceedings. The Servicer is entitled to
reimbursement of
such costs and expenses from the liquidation proceeds with respect
to the
related Mortgaged Property, as provided in the definition of
Liquidation
Proceeds. If the Servicer has knowledge that a Mortgaged Property
that the
Servicer is contemplating acquiring in foreclosure or by deed in
lieu of
foreclosure is located within a one mile radius of any site listed
in the
Expenditure Plan for the Hazardous Substance Clean Up Bond Act of
1984 or
other site with environmental or hazardous waste risks known to the
Servicer,
the Servicer will, before acquiring the Mortgaged Property,
consider the risks
and only take action in accordance with its established
environmental review
procedures.
With
respect to any REO Property, the deed or certificate of sale
shall
be taken in the name of the Trustee for the benefit of the
Certificateholders,
or its nominee, on behalf of the Certificateholders. The Trustee's
name shall
be placed on the title to the REO Property solely as the Trustee
hereunder and
not in its individual capacity. The Servicer shall ensure that the
title to
the REO Property references the Pooling and Servicing Agreement and
the
Trustee's capacity hereunder. Pursuant to its efforts to sell the
REO
Property, the Servicer shall either itself or through an agent
selected by the
Servicer protect and conserve the REO Property in accordance with
the
Servicing Standard.
The
Servicer shall perform the tax reporting and withholding required
by
sections 1445 and 6050J of the Code with respect to foreclosures
and
abandonments, the tax reporting required by section 6050H of the
Code with
respect to the receipt of mortgage interest from individuals and,
if required
by section 6050P of the Code with respect to the cancellation of
indebtedness
by certain financial entities, by preparing any required tax and
information
returns, in the form required.
If
the Trust Fund acquires any Mortgaged Property as aforesaid or
otherwise in connection with a default or imminent default on a
Mortgage Loan,
the REO Property shall only be held temporarily, shall be actively
marketed
for sale, and the Servicer shall dispose of the Mortgaged Property
as soon as
practicable, and in any case before the end of the third calendar
year
following the calendar year in which the Trust Fund acquires the
property.
Notwithstanding any other provision of this Agreement, no Mortgaged
Property
acquired by the Trust Fund shall be rented (or allowed to continue
to be
rented) or otherwise used for the production of income by or on
behalf of the
Trust Fund.
The
decision of the Servicer to foreclose on a defaulted Mortgage
Loan
shall be subject to a determination by the Servicer that the
proceeds of the
foreclosure would exceed the costs and expenses of bringing a
foreclosure
proceeding. The proceeds received from the maintenance of any REO
Properties,
net of reimbursement to the Servicer for costs incurred (including
any
property or other taxes) in connection with maintenance of the REO
Properties
and net of unreimbursed Servicing Fees, Advances, and Servicing
Advances,
shall be applied to the payment of principal of and interest on the
related
defaulted Mortgage Loans (with interest accruing as though the
Mortgage Loans
were still current and adjustments, if applicable, to the Mortgage
Rate were
being made in accordance with the Mortgage Note) and all such
proceeds shall
be deemed, for all purposes in this Agreement, to be payments on
account of
principal and interest on the related Mortgage Notes and shall be
deposited
into the Certificate Account. To the extent the net proceeds
received during
any calendar month exceeds the amount attributable to amortizing
principal and
accrued interest at the related Mortgage Rate on the related
Mortgage Loan for
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the calendar month, the excess shall be considered to be a partial
prepayment
of principal of the related Mortgage Loan.
The
proceeds from any liquidation of a Mortgage Loan, as well as
any
proceeds from an REO Property, will be applied in the following
order of
priority: first, to reimburse the Servicer for any related
unreimbursed
Servicing Advances or Servicing Fees or for any related
unreimbursed Advances,
as applicable; second, to reimburse the Servicer, as applicable,
and to
reimburse the Certificate Account for any Nonrecoverable Advances
(or portions
thereof) that were previously withdrawn by the Servicer pursuant to
Section
3.09(a)(iii) that related to the Mortgage Loan; third, to accrued
and unpaid
interest (to the extent no Advance has been made for such amount or
any such
Advance has been reimbursed) on the Mortgage Loan or related REO
Property, at
the Adjusted Net Mortgage Rate to the Due Date occurring in the
month in which
such amounts are required to be distributed; and fourth, as a
recovery of
principal of the Mortgage Loan. The Servicer will retain any Excess
Proceeds
from the liquidation of a Liquidated Mortgage Loan as additional
servicing
compensation pursuant to Section 3.15.
The
Servicer may agree to a modification of any Mortgage Loan at
the
request of the related Mortgagor if (i) the modification is in lieu
of a
refinancing and (ii) the Servicer purchases that Mortgage Loan from
the Trust
Fund as described below. Upon the agreement of the Servicer to
modify a
Mortgage Loan in accordance with the preceding sentence, the
Servicer shall
purchase that Mortgage Loan and all interest of the Trustee in that
Mortgage
Loan shall automatically be deemed transferred and assigned to the
Servicer
and all benefits and burdens of ownership thereof, including the
right to
accrued interest thereon from the date of purchase and the risk of
default
thereon, shall pass to the Servicer. The Servicer shall promptly
deliver to
the Trustee a certification of a Servicing Officer to the effect
that all
requirements of this paragraph have been satisfied with respect to
a Mortgage
Loan to be repurchased pursuant to this paragraph.
The
Servicer shall deposit the Purchase Price for any Mortgage Loan
repurchased pursuant to Section 3.12 in the Certificate Account
pursuant to
Section 3.06 within one Business Day after the purchase of the
Mortgage Loan.
Upon receipt by the Trustee of written notification of any such
deposit signed
by a Servicing Officer, the Trustee shall release to the Servicer
the related
Mortgage File and shall execute and deliver such instruments of
transfer or
assignment, in each case without recourse, as shall be necessary to
vest in
the Servicer any Mortgage Loan previously transferred and assigned
pursuant
hereto. The Servicer covenants and agrees to indemnify the Trust
Fund against
any liability for any "prohibited transaction" taxes and any
related interest,
additions, and penalties imposed on the Trust Fund established
hereunder as a
result of any modification of a Mortgage Loan effected pursuant to
this
Section, or any purchase of a Mortgage Loan by the Servicer in
connection with
a modification (but such obligation shall not prevent the Servicer
or any
other appropriate Person from contesting any such tax in
appropriate
proceedings and shall not prevent the Servicer from withholding
payment of
such tax, if permitted by law, pending the outcome of such
proceedings). The
Servicer shall have no right of reimbursement for any amount paid
pursuant to
the foregoing indemnification, except to the extent that the amount
of any
tax, interest, and penalties, together with interest thereon, is
refunded to
the Trust Fund.
Section 3.13 Trustee to Cooperate; Release of Mortgage Files.
Upon
the payment in full of any Mortgage Loan, or the receipt by the
Servicer of a notification that payment in full will be escrowed in
a manner
customary for such purposes, the Servicer will immediately notify
the Trustee
by delivering a Request for Release substantially in the form of
Exhibit N.
Upon receipt of the request, the Trustee shall promptly release the
related
Mortgage File to the Servicer, and the Trustee shall at the
Servicer's
direction execute and deliver to the Servicer the request for
reconveyance,
deed of reconveyance, or release or satisfaction of mortgage or
such
instrument releasing the lien of the Mortgage in each case provided
by the
Servicer, together with the Mortgage Note with
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written evidence of cancellation thereon. The Servicer is
authorized to cause
the removal from the registration on the MERS System of such
Mortgage and to
execute and deliver, on behalf of the Trustee and the
Certificateholders or
any of them, any and all instruments of satisfaction or
cancellation or of
partial or full release. Expenses incurred in connection with any
instrument
of satisfaction or deed of reconveyance shall be chargeable to the
related
Mortgagor.
From
time to time and as shall be appropriate for the servicing or
foreclosure of any Mortgage Loan, including for such purpose
collection under
any policy of flood insurance, any fidelity bond or errors or
omissions
policy, or for the purposes of effecting a partial release of any
Mortgaged
Property from the lien of the Mortgage or the making of any
corrections to the
Mortgage Note or the Mortgage or any of the other documents
included in the
Mortgage File, the Trustee shall, upon delivery to the Trustee of a
Request
for Release in the form of Exhibit M signed by a Servicing Officer,
release
the Mortgage File to the Servicer or its designee. Subject to the
further
limitations set forth below, the Servicer shall cause the Mortgage
File or
documents so released to be returned to the Trustee when the need
therefor by
the Servicer no longer exists, unless the Mortgage Loan is
liquidated and the
proceeds thereof are deposited in the Certificate Account, in which
case the
Servicer shall deliver to the Trustee a Request for Release in the
form of
Exhibit N, signed by a Servicing Officer.
If
the Servicer at any time seeks to initiate a foreclosure proceeding
in
respect of any Mortgaged Property as authorized by this Agreement,
the
Servicer shall deliver to the Trustee, for signature, as
appropriate, any
court pleadings, requests for trustee's sale, or other documents
necessary to
effectuate such foreclosure or any legal action brought to obtain
judgment
against the Mortgagor on the Mortgage Note or the Mortgage or to
obtain a
deficiency judgment or to enforce any other remedies or rights
provided by the
Mortgage Note or the Mortgage or otherwise available at law or in
equity.
Section 3.14 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 it
receives
or otherwise collects as Liquidation 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 any funds on deposit in the Certificate
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 Certificate Account, 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 3.15 Servicing Compensation.
As
compensation for its activities hereunder, the Servicer may retain
or
withdraw from the Certificate Account the Servicing Fee for each
Mortgage Loan
for the related Distribution Date. Notwithstanding the foregoing,
the
Servicing Fee payable to the Servicer shall be reduced by the
lesser of the
aggregate of the Prepayment Interest Shortfalls with respect to
the
Distribution Date and the aggregate Compensating Interest for the
Distribution
Date.
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The
Servicer may retain or withdraw from the Certificate Account
the
Servicing Fee for each Mortgage Loan for the related Distribution
Date. If the
Servicer directly services a Mortgage Loan, the Servicer may retain
the
Servicing Fee for its own account as compensation for performing
services.
Additional servicing compensation in the form of Excess
Proceeds,
Prepayment Interest Excess, assumption fees, late payment charges
and all
income net of any losses realized from Permitted Investments shall
be retained
by the Servicer to the extent not required to be deposited in the
Certificate
Account pursuant to Section 3.06. The Servicer shall be required to
pay all
expenses incurred by it in connection with its servicing activities
hereunder
(including the payment of any premiums for hazard insurance, and
any Primary
Insurance Policy and maintenance of the other forms of insurance
coverage
required by this Agreement) and shall not be entitled to
reimbursement
therefor except as specifically provided in this Agreement.
Section 3.16 Access to Certain Documentation.
The
Servicer shall provide to the OTS and the FDIC and to
comparable
regulatory authorities supervising Holders of Certificates and
Certificate
Owners and the examiners and supervisory agents of the OTS, the
FDIC, and such
other authorities, access to the documentation regarding the
Mortgage Loans
required by applicable regulations of the OTS and the FDIC. Access
shall be
afforded without charge, but only upon reasonable prior written
request and
during normal business hours at the offices designated by the
Servicer.
Nothing in this Section 3.16 shall limit the obligation of the
Servicer to
observe any applicable law prohibiting disclosure of information
regarding the
Mortgagors and the failure of the Servicer to provide access as
provided in
this Section 3.16 as a result of such obligation shall not
constitute a breach
of this Section 3.16.
Section 3.17 Annual Statement as to Compliance.
(a) By March 1 of each year, commencing with 2007, the Servicer
shall deliver to the Trustee via electronic mail
(DBSEC.Notifications@db.com) and the Depositor an Officer's
Certificate
signed by two Servicing Officers stating, as to each signer
thereof, that
(i)
a review of the activities of the Servicer during the preceding
calendar year (or applicable portion thereof) and of the
performance of
the
Servicer under this Agreement has been made under such
officer's
supervision, and (ii) to the best of such officer's knowledge,
based on
the
review, the Servicer has fulfilled all its obligations under
this
Agreement, in all material respects throughout the year (or
applicable
portion thereof), or, if there has been a failure to fulfill
any
obligation in any material respect, specifying each failure known
to the
officer and the nature and status thereof.
(b) [Reserved].
(c) The Trustee shall forward a copy of each such statement to
each
Rating Agency. Copies of such statement shall be provided by the
Trustee
to
any Certificateholder or Certificate Owner upon request at the
Servicer's expense, provided such statement is delivered by the
Servicer
to the Trustee.
Section 3.18 Errors and Omissions Insurance; Fidelity Bonds.
The
Servicer shall obtain and maintain in force (a) policies of
insurance
covering errors and omissions in the performance of its obligations
as
Servicer hereunder and (b) a fidelity bond covering its officers,
employees,
and agents. Each policy and bond shall, together, comply with the
requirements
from time to time of FNMA or FHLMC for persons performing servicing
for
mortgage loans purchased
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by FNMA or FHLMC. If any policy or bond ceases to be in effect, the
Servicer
shall obtain a comparable replacement policy or bond from an
insurer or issuer
meeting the above requirements as of the date of the
replacement.
Section 3.19 [Reserved]
Section 3.20 Prepayment Charges.
The
Servicer will not waive any part of any Prepayment Charge unless
the
waiver relates to a default or a reasonably foreseeable default,
the
Prepayment Charge would cause an undue hardship to the related
borrower, the
Mortgaged Property is sold by the Mortgagor, the collection of any
Prepayment
Charge would violate any relevant law or regulation or the waiving
of the
Prepayment Charge would otherwise benefit the Trust Fund and it is
expected
that the waiver would maximize recovery of total proceeds taking
into account
the value of the Prepayment Charge and related Mortgage Loan and
doing so is
standard and customary in servicing similar Mortgage Loans
(including any
waiver of a Prepayment Charge in connection with a refinancing of a
Mortgage
Loan that is related to a default or a reasonably foreseeable
default). The
Servicer will not waive a Prepayment Charge in connection with a
refinancing
of a Mortgage Loan that is not related to a default or a
reasonably
foreseeable default.
If a
Prepayment Charge is waived other than as permitted by the
prior
paragraph, then the Servicer is required to pay the amount of such
waived
Prepayment Charge, for the benefit of the Holders of the Class P
Certificates,
by depositing such amount into the Distribution Account from its
own funds,
without any right of reimbursement therefor, together with and at
the time
that the amount prepaid on the related Mortgage Loan is required to
be
deposited into the Distribution Account.
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ARTICLE FOUR
DISTRIBUTIONS AND ADVANCES BY THE SERVICER
Section 4.01 Advances.
(a) The Servicer shall determine on or before each Servicer
Advance
Date
whether it is required to make an Advance pursuant to the
definition
thereof. If the Servicer determines it is required to make an
Advance, it
shall, on or before the Servicer Advance Date, either (i) deposit
into
the
Certificate Account an amount equal to the Advance or (ii) make
an
appropriate entry in its records relating to the Certificate
Account that
any
Amount Held for Future Distribution has been used by the Servicer
in
discharge of its obligation to make any such Advance. Any funds
so
applied shall be replaced by the Servicer by deposit in the
Certificate
Account no later than the close of business on the next Servicer
Advance
Date. The Servicer shall be entitled to be reimbursed from the
Certificate Account for all Advances of its own funds made pursuant
to
this
Section 4.01 as provided in Section 3.09. The obligation to
make
Advances with respect to any Mortgage Loan shall continue if
such
Mortgage Loan has been foreclosed or otherwise terminated and
the
Mortgaged Property has not been liquidated. The Servicer shall
inform the
Trustee of the amount of the Advance to be made on each Servicer
Advance
Date
no later than the second Business Day before the related
Distribution Date.
(b) If the Servicer determines that it will be unable to comply
with
its
obligation to make the Advances as and when described in the
second
sentence of Section 4.01(a), it shall use its best efforts to
give
written notice thereof to the Trustee (each such notice an
"Advance
Notice"; and such notice may be given by telecopy), not later than
3:00
P.M., New York time, on the Business Day immediately preceding
the
related Servicer
Advance Date, specifying the amount that it will be
unable to deposit (each such amount an "Advance Deficiency")
and
certifying that such Advance Deficiency constitutes an Advance
hereunder
and
is not a Nonrecoverable Advance. If the Trustee receives a
Trustee
Advance Notice on or before 3:00 P.M., New York time on a
Servicer
Advance Date, the Trustee is entitled to immediately terminate
the
Servicer under Section 7.01, and shall, not later than 3:00 P.M.,
New
York
time, on the related Distribution Date, deposit in the
Distribution
Account an amount equal to the Advance Deficiency identified in
such
Trustee Advance Notice unless it is prohibited from so doing by
applicable law. Notwithstanding the foregoing, the Trustee shall
not be
required to make such deposit if the Trustee shall have received
written
notification from the Servicer that the Servicer has deposited or
caused
to
be deposited in the Certificate Account an amount equal to such
Advance Deficiency by 3:00 P.M. New York time on the related
Distribution
Date. If the Trustee has not terminated the Servicer, the Servicer
shall
