==============================================================================
WELLS FARGO ASSET SECURITIES CORPORATION,
Depositor
WELLS FARGO BANK, N.A.,
Servicer
WELLS FARGO BANK, N.A.,
Securities Administrator
and
HSBC Bank USA, National Association,
Trustee
POOLING AND SERVICING AGREEMENT
Dated as of [ ], 200
Home Equity Asset-Backed Certificates, Series 200 -
==============================================================================
<PAGE>
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
Section 1.01 Defined
Terms..................................................5
Section 1.02
Accounting...................................................
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01
Conveyance of Mortgage Loans.................................
Section 2.02
Acceptance by Custodian......................................
Section 2.03
Repurchase or Substitution of Mortgage Loans by the
Depositor...................................................
Section 2.04
Representations and Warranties of the Depositor with
respect to the Mortgage Loans...............................
Section 2.05
Representations, Warranties and Covenants of the Servicer....
Section 2.06
Representations and Warranties of the Depositor..............
Section 2.07 Issuance
of Certificates and the Uncertificated Regular
Interests...................................................
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE TRUST FUND
Section 3.01 Servicer
to Act as Servicer..................................
Section 3.02
Collection of Mortgage Loan Payments.........................
Section 3.03
Realization Upon Defaulted Mortgage Loans....................
Section 3.04
Collection Account, Distribution Account and Reserve
Account.....................................................
Section 3.05 Permitted
Withdrawals From the Collection Account............
Section 3.06
Establishment of Escrow Accounts; Deposits in Escrow
Accounts....................................................
Section 3.07 Permitted
Withdrawals From Escrow Account....................
Section 3.08 Payment
of Taxes, Insurance and Other Charges;
Collections Thereunder; Primary Mortgage Insurance..........
Section 3.09 Transfer
of Accounts.........................................
Section 3.10
Maintenance of Hazard Insurance..............................
Section 3.11
Maintenance of Mortgage Impairment Insurance Policy..........
Section 3.12 Fidelity
Bond, Errors and Omissions Insurance................
Section 3.13 Title,
Management and Disposition of REO Property............
Section 3.14
Due-on-Sale Clauses; Assumption and Substitution
Agreements..................................................
Section 3.15 Duties of
the Credit Risk Manager............................
Section 3.16 Optional
Purchases of 60+ Day Delinquent Loans...............
Section 3.17 Trustee
to Cooperate; Release of Files.......................
Section 3.18 Servicing
Compensation.......................................
Section 3.19 Annual
Statement as to Compliance............................
Section 3.20
Assessment of Servicing Compliance; Registered Public
Accounting Firm Attestation Reports.........................
Section 3.21 Access to
Certain Documentation and Information Regarding
the
Mortgage Loans..........................................
Section 3.22
Obligations of the Servicer in Respect of Compensating
Interest....................................................
Section 3.23
Investment of Funds in the Collection Account and the
Distribution Account........................................
Section 3.24 Liability
of Servicer; Indemnification.......................
Section 3.25 Reports
of Foreclosure and Abandonment of Mortgaged
Properties..................................................
Section 3.26
Limitation of Liability of the Credit Risk Manager...........
Section 3.27 No
Personal Solicitation.....................................
Section 3.28 Exchange
Act Reports.........................................
ARTICLE IV
FLOW OF FUNDS
Section 4.01 Interest
Distributions........................................
Section 4.02 Distributions of Principal and Monthly Excess
Cashflow
Amounts.....................................................
Section 4.03
Allocation of Losses.........................................
Section 4.04 Method of
Distribution.......................................
Section 4.05
Distributions on Book-Entry Certificates.....................
Section 4.06
Statements...................................................
Section 4.07
Remittance Reports; Advances.................................
Section 4.08 REMIC
Distributions..........................................
ARTICLE V
THE CERTIFICATES
Section 5.01 The
Certificates.............................................
Section 5.02
Registration of Transfer and Exchange of Certificates........
Section 5.03
Mutilated, Destroyed, Lost or Stolen Certificates............
Section 5.04 Persons
Deemed Owners........................................
Section 5.05
Appointment of Paying Agent..................................
ARTICLE VI
THE SERVICER AND THE DEPOSITOR
Section 6.01 Liability
of the Servicer and the Depositor..................
Section 6.02 Merger or
Consolidation of, or Assumption of the
Obligations of, the Servicer or the Depositor...............
Section 6.03
Limitation on Liability of the Servicer and Others...........
Section 6.04 Servicer
Not to Resign.......................................
Section 6.05
Delegation of Duties.........................................
ARTICLE VII
DEFAULT
Section 7.01 Servicer
Events of Termination...............................
Section 7.02 Trustee
to Act; Appointment of Successor.....................
Section 7.03 Waiver of
Defaults...........................................
Section 7.04
Notification to Certificateholders...........................
Section 7.05 Survival
of Servicer Liabilities.............................
ARTICLE VIII
THE TRUSTEE AND THE SECURITIES ADMINISTRATOR
Section 8.01 Duties of
Trustee and Securities Administrator...............
Section 8.02 Certain
Matters Affecting the Trustee and the Securities
Administrator...............................................
Section 8.03 Trustee
and Securities Administrator Not Liable for
Certificates or Mortgage Loans..............................
Section 8.04 Trustee
and Securities Administrator May Own Certificates....
Section 8.05 Trustee
and Securities Administrator Fees and Expenses.......
Section 8.06
Eligibility Requirements for Trustee and Securities
Administrator...............................................
Section 8.07
Resignation or Removal of Trustee and Securities
Administrator...............................................
Section 8.08 Successor
Trustee and Successor Securities Administrator.....
Section 8.09 Merger or
Consolidation of Trustee or Securities
Administrator...............................................
Section 8.10
Appointment of Co-Trustee or Separate Trustee................
Section 8.11
Limitation of Liability......................................
Section 8.12 Trustee
or Securities Administrator May Enforce Claims
Without Possession of Certificates..........................
Section 8.13 Suits for
Enforcement........................................
Section 8.14 Waiver of
Bond Requirement...................................
Section 8.15 Waiver of
Inventory, Accounting and Appraisal Requirement....
Section 8.16
Appointment of Custodian.....................................
ARTICLE IX
REMIC AND GRANTOR TRUST ADMINISTRATION
Section 9.01 REMIC
Administration.........................................
Section 9.02
Prohibited Transactions and Activities.......................
Section 9.03
Indemnification with Respect to Certain Taxes and Loss of
REMIC Status................................................
Section 9.04 REO
Property.................................................
Section 9.05 Grantor
Trust Administration.................................
ARTICLE X
TERMINATION
Section 10.01
Termination..................................................
Section 10.02 Additional Termination
Requirements..........................
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01
Amendment....................................................
Section 11.02 Recordation of Agreement;
Counterparts.......................
Section 11.03 Limitation on Rights of
Certificateholders...................
Section 11.04 Governing Law;
Jurisdiction..................................
Section 11.05
Notices......................................................
Section 11.06 Severability of
Provisions...................................
Section 11.07 Article and Section
References...............................
Section 11.08 Notice to the Rating
Agencies................................
Section 11.09 Further
Assurances...........................................
Section 11.10 Benefits of
Agreement........................................
Section 11.11 Acts of
Certificateholders...................................
Section 11.12 Regulation AB Compliance; Intent of Parties;
Reasonableness..............................................
<PAGE>
EXHIBITS:
Exhibit A-1 Form
of Class AI-1A Certificates
Exhibit A-2 Form
of Class AI-1B Certificates
Exhibit A-4 Form
of Class AII-1 Certificates
Exhibit A-5 Form
of Class AII-2 Certificates
Exhibit A-6 Form
of Class AII-3 Certificates
Exhibit B-1 Form
of Class M-1 Certificates
Exhibit B-2 Form
of Class M-2 Certificates
Exhibit B-3 Form
of Class M-3 Certificates
Exhibit B-4 Form
of Class M-4 Certificates
Exhibit B-5 Form
of Class M-5 Certificates
Exhibit B-6 Form
of Class M-6 Certificates
Exhibit B-7 Form
of Class M-7 Certificates
Exhibit B-8 Form
of Class M-8 Certificates
Exhibit B-9 Form
of Class M-9 Certificates
Exhibit B-10 Form of
Class M-10 Certificates
Exhibit B-11 Form of
Class M-11 Certificates
Exhibit B-12 Form of
Class M-12 Certificates
Exhibit B-13 Form of
Class M-13 Certificates
Exhibit C-1 Form
of Class CE Certificates
Exhibit C-2 Form
of Class P Certificates
Exhibit C-3 Form
of Class R Certificates
Exhibit C-4 Form
of Class R-X Certificates
Exhibit D-1
Addresses for Requesting Mortgage Loan Schedule
Exhibit E
Form of Request for Release
Exhibit F-1 Form
of Custodian's Initial Certification
Exhibit F-2 Form
of Custodian's Final Certification
Exhibit G
Form of Mortgage Loan Purchase Agreement
Exhibit H
Form of Lost Note Affidavit
Exhibit I
Form of ERISA Representation Letter
Exhibit J
Form of Rule 144A Investment Letter
Exhibit K
Form of Class [R] [R-X] Certificate Transfer Affidavit
Exhibit L
Form of Transferor
Certificate for the
Class M-12,
Class
M-13, Class CE, Class P, Class R and Class R-X Certificates
Exhibit M
Monthly Information Provided by Servicer
Exhibit N
Form of Yield Maintenance Agreement
Exhibit O
Form of Sarbanes-Oxley Certification
Exhibit P
Form of Certification of the Securities Administrator
to be Provided to Servicer
Exhibit Q
List of Recordation States
Exhibit R
Form of Custodial Agreement
Exhibit S
Servicing
Criteria to
be Addressed in Assessment of
Compliance
Exhibit T
Additional Form 10-D Disclosure
Exhibit U
Additional Form 10-K Disclosure
Exhibit V
Form 8-K Disclosure Information
Exhibit W
Additional Disclosure Notification
<PAGE>
This Pooling and Servicing Agreement is dated as of [ ], 200
(the
"Agreement"), among WELLS FARGO ASSET SECURITIES CORPORATION, as
depositor (the
"Depositor"), WELLS FARGO BANK, N.A., as servicer (the "Servicer"),
WELLS FARGO
BANK, N.A., as securities administrator (the "Securities
Administrator") and
HSBC BANK USA, NATIONAL ASSOCIATION, as trustee (the
"Trustee").
PRELIMINARY STATEMENT
The Depositor intends to sell pass-through certificates
(collectively, the "Certificates"), to be issued hereunder in
multiple Classes,
which in the aggregate will evidence the entire beneficial
ownership interest in
the Trust Fund created hereunder. The Certificates will consist of
twenty-two
Classes of Certificates, designated as (i) the Class AI-1A, Class
AI-1B, Class
AII-1, Class AII-2 and Class AII-3 Certificates, (ii) the Class
M-1, Class M-2,
Class M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8,
Class M-9,
Class M-10, Class M-11, Class M-12 and Class M-13 Certificates,
(iii) the Class
CE Certificates, (iv) the Class P Certificates and (v) the Class R
and Class R-X
Certificates.
REMIC 1
As provided herein, the Trustee will make an election to treat
the
segregated pool of assets consisting of the Mortgage Loans and
certain other
related assets subject to this Agreement (but exclusive of the
Yield Maintenance
Agreement, the Reserve Account, the Cap Carryover Amounts, the
Prepayment
Penalties, the Servicer Prepayment Penalty Payment Amounts and the
Originator
Prepayment Penalty Payment Amounts) as a real estate investment
conduit (a
"REMIC") for federal income tax purposes, and such segregated pool
of assets
will be designated as "REMIC 1." The Class R-1 Interest will
represent the sole
class of "residual interests" in REMIC 1 for purposes of the REMIC
Provisions
under federal income tax law. The following table irrevocably sets
forth the
designation, the Uncertificated REMIC 1 Pass-Through Rate, the
initial
Uncertificated Principal Balance, and solely for purposes of
satisfying Treasury
Regulations Section 1.860G-1(a)(4)(iii), the "latest possible
maturity date" for
each of the REMIC 1 Regular Interests. None of the REMIC 1 Regular
Interests
will be certificated.
<PAGE>
===========================================================================
Uncertificated
Initial
REMIC 1
Uncertificated Latest Possible
Designation
Pass-Through Rate
Principal Balance Maturity Date(1)
---------------------------------------------------------------------------
LT1AA
Variable(2) $
[______], 20
LT1AI1A
Variable(2) $
[______], 20
LT1AI1B
Variable(2) $
[______], 20
LT1AII1
Variable(2) $
[______], 20
LT1AII2
Variable(2) $
[______], 20
LT1AII3
Variable(2) $
[______],
20
LT1M1
Variable(2) $
[______], 20
LT1M2
Variable(2) $
[______], 20
LT1M3
Variable(2) $
[______], 20
LT1M4
Variable(2) $
[______], 20
LT1M5
Variable(2) $
[______], 20
LT1M6
Variable(2) $
[______], 20
LT1M7
Variable(2) $
[______], 20
LT1M8
Variable(2) $
[______], 20
LT1M9
Variable(2) $
[______], 20
LT1M10
Variable(2) $
[______], 20
LT1M11
Variable(2)
$
[______], 20
LT1M12
Variable(2) $
[______], 20
LT1M13
Variable(2) $
[______], 20
LT1ZZ
Variable(2) $
[______],
20
LT1SUB
Variable(2) $
[______], 20
LT1GRP
Variable(2) $
[______], 20
LT2SUB
Variable(2) $
[______], 20
LT2GRP
Variable(2)
$
[______], 20
LT1XX
Variable(2) $
[______], 20
=============================================================================
(1) Solely for
purposes of Treasury Regulations Section 1.860G-1(a)(4)(iii),
the
Distribution Date immediately following the maturity date for
the
Mortgage
Loan with the latest maturity date has been designated as the
"latest
possible maturity date" for each REMIC 1 Regular Interest.
(2) Calculated
in accordance with the definition of "Uncertificated REMIC 1
Pass-Through Rate" herein.
<PAGE>
REMIC 2
As provided herein, the Trustee shall make an election to treat
the
segregated pool of assets consisting of the REMIC 1 Regular
Interests as a REMIC
for federal income tax purposes, and such segregated pool of assets
will be
designated as "REMIC 2." The Class R-2 Interest represents the sole
class of
"residual interests" in REMIC 2 for purposes of the REMIC
Provisions.
The following table sets forth (or describes) the Class
designation,
Original Principal Balance, the Pass-Through Rate and Assumed Final
Maturity
Dates for each Class of Certificates and the Class CE
Uncertificated Interest
comprising the interests in the Trust Fund created hereunder:
=============================================================================
Original
Pass-Through
Assumed Final
Class
Principal Balance
Rate
Maturity Dates*
-----------------------------------------------------------------------------
AI-1A
$
(1)
[___], 20
AI-1B
$
(2)
[___], 20
AII-1
$
(3)
[___], 20
AII-2
$
(4)
[___], 20
AII-3
$
(5)
[___], 20
M-1
$
(6)
[___], 20
M-2
$
(7)
[___], 20
M-3
$
(8)
[___], 20
M-4
$
(9)
[___], 20
M-5
$
(10)
[___], 20
M-6
$
(11)
[___], 20
M-7
$
(12)
[___], 20
M-8
$
(13)
[___], 20
M-9
$
(14)
[___], 20
M-10
$
(15)
[___], 20
M-11
$
(16)
[___], 20
M-12
$
(17)
[___], 20
M-13
$
(18)
[___], 20
CE
(19)
(19)
N/A
P
N/A
N/A
N/A
R
N/A
N/A
N/A
R-X
N/A
N/A
N/A
Total
$
N/A
=============================================================================
*
Solely for purposes of Treasury Regulations Section
1.860G-1(a)(4)(iii),
the
Distribution Date following the maturity date for the Mortgage
Loan
with the
latest maturity date has been designated as the "latest
possible
maturity
date" for each Class of Certificates and the Class CE
Uncertificated Interest that represents one or more of the
"regular
interests"
in REMIC 2.
(1) The
Pass-Through Rate for the Class AI-1A Certificates during each
Interest
Accrual Period is equal to the lesser of: (i) the Class AI-1A
Formula
Rate and (ii) the Group I Cap for such Distribution Date.
(2) The
Pass-Through Rate for the Class AI-1B Certificates during each
Interest
Accrual Period is equal to the lesser of: (i) the Class AI-1B
Formula
Rate and (ii) the Group I Cap for such Distribution Date.
(3) The
Pass-Through Rate for the Class AII-1 Certificates during each
Interest
Accrual Period is equal to the lesser of: (i) the Class AII-1
Formula
Rate and (ii) the Group II Cap for such Distribution Date.
(4) The
Pass-Through Rate for the Class AII-2 Certificates during each
Interest
Accrual Period is equal to the lesser of: (i) the Class AII-2
Formula
Rate and (ii) the Group II Cap for such Distribution Date.
(5) The
Pass-Through Rate for the Class AII-3 Certificates during each
Interest
Accrual Period is equal to the lesser of: (i) the Class AII-3
Formula Rate and (ii)
the Group II Cap for such Distribution Date.
(6) The
Pass-Through Rate for the Class M-1 Certificates during each
Interest
Accrual
Period is equal to the lesser of: (i) the Class M-1 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(7) The
Pass-Through Rate for the Class M-2 Certificates during each
Interest
Accrual
Period is equal to the lesser of: (i) the Class M-2 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(8) The
Pass-Through Rate for the Class M-3 Certificates during each
Interest
Accrual
Period is equal to the lesser of: (i) the Class M-3 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(9) The
Pass-Through Rate for the Class M-4 Certificates during each
Interest
Accrual
Period is equal to the lesser of: (i) the Class M-4 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(10) The Pass-Through
Rate for the Class M-5 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-5 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(11) The Pass-Through
Rate for the Class M-6 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-6 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(12) The Pass-Through
Rate for the Class M-7 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-7 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(13) The Pass-Through
Rate for the Class M-8 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-8 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(14) The Pass-Through
Rate for the Class M-9 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-9 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(15) The Pass-Through
Rate for the Class M-10 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-10 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(16) The Pass-Through
Rate for the Class M-11 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-11 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(17) The Pass-Through
Rate for the Class M-12 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-12 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(18) The Pass-Through
Rate for the Class M-13 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-13 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(19) REMIC 2 will
issue an Uncertificated Regular Interest economically
equivalent
to the Class CE Uncertificated Interest. That Regular Interest
will be an
asset of REMIC A which will issue the Class CE Certificates as
described
under "REMIC A" in this Preliminary Statement. Solely for REMIC
purposes,
the Class CE Certificates will (i) have an Original Principal
Balance
equal to the Initial Overcollateralization Amount (but will not
bear
interest on such amount) and (ii) will bear interest on its
Notional
Amount.
REMIC A
As provided herein, the Trustee shall make an election to treat
the
segregated pool of assets consisting of the Class CE Uncertificated
Interest as
a REMIC for federal income tax purposes, and such segregated pool
of assets will
be designated as "REMIC A." The Class CE Certificates (other than
the obligation
of the Class CE Certificates to make payments with respect to Cap
Carryover
Amounts) represent the sole class of regular interests and the
Class R-X
Certificate represents the sole class of "residual interests" in
REMIC A for
purposes of the REMIC Provisions. Solely for REMIC purposes, the
Class CE
Certificates shall have a principal balance equal to the Class CE
Uncertificated
Interest and shall bear interest at the same rate as the Class CE
Uncertificated
Interest, in each case as described in footnote (19) relating to
REMIC 2. Solely
for purposes of Treasury Regulations Section 1.860G-1(a)(4)(iii),
the
Distribution Date following the maturity date for the Mortgage Loan
with the
latest maturity date has been designated as the "latest possible
maturity date"
for the Class CE Certificates.
ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms. Whenever used in this Agreement or
in
the Preliminary Statement, the following words and phrases, unless
the context
otherwise requires, shall have the meanings specified in this
Article. Interest
on all Regular Certificates will be calculated on the basis of the
actual number
of days in the related Interest Accrual Period and a 360-day
year.
"1933 Act" The Securities Act of 1933, as amended.
"60+ Day Delinquent Loan" Each Mortgage Loan (including each
Mortgage Loan in foreclosure and each Mortgage Loan for which the
Mortgagor has
filed for bankruptcy after the Closing Date) with respect to which
any portion
of a Monthly Payment is, as of the last day of the prior Collection
Period, two
months or more past due and each Mortgage Loan relating to an REO
Property.
"Account" Any of the
Collection Account,
the Distribution
Account, the Reserve Account or the Escrow Account.
"Accrued Certificate
Interest" With respect to each
Distribution Date and Class of Certificates (other than the Class
CE, Class P
and Residual Certificates), an amount equal to the interest accrued
at the
Pass-Through Rate set forth or described for such Class in the
table in the
Preliminary Statement during the related Interest Accrual Period on
the
Principal Balance of such Class of Certificates, reduced by such
Class' Interest
Percentage of any Current Interest Shortfall for such Distribution
Date.
"Additional Form 10-D Disclosure" As defined in Section
3.28(a).
"Additional Form 10-K Disclosure" As defined in Section
3.28(b).
"Additional Servicer" As defined in Section 6.05.
"Adjustable Rate Mortgage Loan" A Mortgage Loan which has a rate
at
which interest accrues that adjusts based on the Index plus a
related Gross
Margin, as set forth and subject to the limitations in the related
Mortgage
Note.
"Adjustment Date" With respect to each Adjustable Rate Mortgage
Loan, each adjustment date on which the Mortgage Interest Rate
changes pursuant
to the related Mortgage Note. The first Adjustment Date following
the applicable
Cut-off Date as to each Adjustable Rate Mortgage Loan is set forth
in the
Mortgage Loan Schedules.
"Advance" As to any Mortgage Loan, any advance made by the
Servicer
in respect of any Distribution Date pursuant to Section 4.07 or if
the Servicer
fails to make any advance, by the Trustee pursuant to Section
7.01.
"Adverse REMIC Event" As defined in Section 9.01(f) hereof.
"Affiliate" With respect to any Person, any other Person
controlling, controlled by or under common control with such
Person. For
purposes of this definition, "control" means the power to direct
the management
and policies of a Person, directly or indirectly, whether through
ownership of
voting securities, by contract or otherwise and "controlling" and
"controlled"
shall have meanings correlative to the foregoing.
"Agreement" This Pooling and Servicing Agreement and all
amendments
and supplements hereto.
"Applicable Regulations" As to any Mortgage Loan, all federal,
state
and local laws, statutes, rules and regulations applicable
thereto.
"Applied Realized Loss Amount" With respect to each
Distribution
Date, the excess, if any, of (a) the aggregate of the Principal
Balances of the
Certificates (other than the Class CE, Class P and Residual
Certificates and
after giving effect to all distributions on such Distribution Date
and the
increase of any Principal Balances as a result of Subsequent
Recoveries) over
(b) the Pool Balance as of the end of the related Collection
Period.
"Assignment" An assignment of Mortgage, notice of transfer or
equivalent instrument, in recordable form, which is sufficient
under the laws of
the jurisdiction wherein the related Mortgaged Property is located
to reflect or
record the sale of the Mortgage.
"Assumed Final Maturity Date" As to each Class of Certificates,
the
date set forth as such in the Preliminary Statement.
"Available Funds" As to any Distribution Date, an amount equal
to
the excess of (i) the sum of: (a) the aggregate of the Monthly
Payments due
during the related Collection Period and received on or prior to
the related
Determination Date by the Servicer, (b) Liquidation Proceeds,
Insurance
Proceeds, Condemnation Proceeds, Principal Prepayments,
Substitution Adjustment
Amounts, the Purchase Price for any repurchased Mortgage Loan, the
Termination
Price with respect to the termination of the Trust pursuant to
Section 10.01
hereof and other unscheduled recoveries of principal and interest
(excluding
Prepayment Penalties, Originator Prepayment Penalty Payment Amounts
and Servicer
Prepayment Penalty Payment Amounts) in respect of the Mortgage
Loans during the
related Prepayment Period, (c) the aggregate of any amounts
received in respect
of an REO Property deposited in the Collection Account for such
Distribution
Date, (d) any Compensating Interest for such Distribution Date, (e)
the
aggregate of any Advances made by the Servicer or the Trustee for
such
Distribution Date and (f) any Reimbursement Amount or Subsequent
Recovery
deposited into the Collection Account during the related Prepayment
Period over
(ii) the sum of (a) amounts reimbursable or payable to the Servicer
pursuant to
Sections 3.05 or 6.03, (b) amounts reimbursable or payable to the
Trustee
pursuant to Section 7.01 or Section 8.05 and amounts reimbursable
or payable to
the Securities Administrator pursuant to Section 8.05 or Section
9.01(c), (c)
Stayed Funds, (d) the Servicing Fee and (e) amounts deposited in
the Collection
Account or the Distribution Account, as the case may be, in
error.
"Balloon Loan" A Mortgage Loan that provides for the payment of
the
unamortized principal balance of such Mortgage Loan in a single
payment at the
maturity of such Mortgage Loan that is substantially greater than
the preceding
monthly payment.
"Balloon Payment" A payment of the unamortized principal balance
of
a Mortgage Loan in a single payment at the maturity of such
Mortgage Loan that
is substantially greater than the preceding Monthly Payment.
"Bankruptcy Code" Title 11 of the United States Code, as
amended.
"Book-Entry Certificates" Any of the Certificates that shall be
registered in the name of the Depository or its nominee, the
ownership of which
is reflected on the books of the Depository or on the books of a
Person
maintaining an account with the Depository directly, as a
Depository
Participant, or indirectly, as an indirect participant in
accordance with the
rules of the Depository and as described in Section 5.02 hereof. On
the Closing
Date, the Class AI-1A, Class AI-1B, Class AII-1, Class AII-2, Class
AII-3, Class
M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class
M-7, Class
M-8, Class M-9, Class M-10, Class M-11, Class M-12 and Class M-13
Certificates
shall be Book-Entry Certificates.
"Business Day" Any day other than (i) a Saturday or a Sunday or
(ii)
a legal holiday in the State of Delaware, the State of New York,
the State of
Maryland, the State of Minnesota, the State of Iowa or in the city
in which the
Corporate Trust Office of the Trustee or the Securities
Administrator is located
are authorized or obligated by law or executive order to be
closed.
"Cap" Any of the Group I Cap, the Group II Cap or the Pool Cap.
"Cap Amount" With respect to any Distribution Date and any Class
of
Class M Certificates an amount equal to (i) the Yield Maintenance
Agreement
Payment for such Distribution Date multiplied by (ii) a fraction
equal to (a)
the Principal Balance of such Class immediately prior to such
Distribution Date
divided by (b) the sum of the Principal Balances of the Class M
Certificates
immediately prior to such Distribution Date.
"Cap Carryover Amount" If on any Distribution Date, the Accrued
Certificate Interest for any Certificate is based upon a Cap, the
excess of (i)
the amount of interest such Certificate would have been entitled to
receive on
such Distribution Date based on the related Formula Rate, over (ii)
the amount
of interest such Certificate received on such Distribution Date
based on the
related Cap, together with the unpaid portion of any such excess
from prior
Distribution Dates (and interest accrued thereon at the then
applicable Formula
Rate on such Certificate).
"Certificate" Any Regular Certificate or Residual Certificate.
"Certificate Custodian" Initially, Wells Fargo Bank; thereafter
any
other Certificate Custodian acceptable to the Depository and
selected by the
Securities Administrator.
"Certificate Owner" With respect to each Book-Entry Certificate,
any
beneficial owner thereof.
"Certificate Register" and "Certificate Registrar" The register
maintained and registrar appointed pursuant to Section 5.02
hereof.
"Certificateholder" or "Holder" The Person in whose name a
Certificate is registered in the Certificate Register, except that
a
Disqualified Organization or non-U.S. Person shall not be a Holder
of a Residual
Certificate for any purpose hereof.
"Class" Collectively, Certificates or REMIC Regular Interests
which
have the same priority of payment and bear the same class
designation and the
form of which is identical except for variation in the Percentage
Interest
evidenced thereby.
"Class A Certificate" Any one of the Class AI or Class AII
Certificates.
"Class A Certificateholders" Collectively, the Holders of the
Class
A Certificates.
"Class AI Certificate" Any one of the Certificates with an "AI"
designated on the face thereof substantially in the form annexed
hereto as
Exhibits A-1 and A-2, executed by the Securities Administrator on
behalf of the
Trust and authenticated and delivered by the Certificate Registrar,
representing
the right to distributions as set forth herein and therein.
"Class AI-1A Certificate Margin" For each Distribution Date (i)
on
or prior to the Optional Termination Date, [ ]% per annum, and (ii)
following
the Optional Termination Date, [ ]% per annum.
"Class AI-1A Formula Rate" For each Distribution Date, a rate
per
annum equal to the lesser of (a) One-Month LIBOR as of the related
LIBOR
Determination Date, plus the Class AI-1A Certificate Margin and (b)
the Group I
Maximum Rate Cap.
"Class AI-1B Certificate Margin" For each Distribution Date (i)
on
or prior to the Optional Termination Date, [ ]% per annum, and (ii)
following
the Optional Termination Date, [ ]% per annum.
"Class AI-1B Formula Rate" For each Distribution Date, a rate
per
annum equal to the lesser of (a) One-Month LIBOR as of the related
LIBOR
Determination Date, plus the Class AI-1B Certificate Margin and (b)
the Group I
Maximum Rate Cap.
"Class AII Certificate" Any one of the Certificates with an
"AII"
designated on the face thereof substantially in the form annexed
hereto as
Exhibits A-4, A-5 and A-6, executed by the Securities Administrator
on behalf of
the Trust and authenticated and delivered by the Certificate
Registrar,
representing the right to distributions as set forth herein and
therein.
"Class AII-1 Certificate Margin" For each Distribution Date (i)
on
or prior to the Optional Termination Date, [ ]% per annum, and (ii)
following
the Optional Termination Date, [ ]% per annum.
"Class AII-1 Formula Rate" For each Distribution Date, a rate
per
annum equal to the lesser of (a) One-Month LIBOR as of the related
LIBOR
Determination Date, plus the Class AII-1 Certificate Margin and (b)
the Group II
Maximum Rate Cap.
"Class AII-2 Certificate Margin" For each Distribution Date (i)
on
or prior to the Optional Termination Date, [ ]% per annum, and (ii)
following
the Optional Termination Date, [ ]% per annum.
"Class AII-2 Formula Rate" For each Distribution Date, a rate
per
annum equal to the lesser of (a) One-Month LIBOR as of the related
LIBOR
Determination Date, plus the Class AII-2 Certificate Margin and (b)
the Group II
Maximum Rate Cap.
"Class AII-3 Certificate Margin" For each Distribution Date (i)
on
or prior to the Optional Termination Date, [ ]% per annum, and (ii)
following
the Optional Termination Date, [ ]% per annum.
"Class AII-3 Formula Rate" For each Distribution Date, a rate
per
annum equal to the lesser of (a) One-Month LIBOR as of the related
LIBOR
Determination Date, plus the Class AII-3 Certificate Margin and (b)
the Group II
Maximum Rate Cap.
"Class CE Certificates" Any one of the Class CE Certificates as
designated on the face thereof substantially in the form annexed
hereto as
Exhibit C-1, executed by the Securities Administrator on behalf of
the Trust and
authenticated and delivered by the Certificate Registrar,
representing the right
to distributions as set forth herein and therein.
"Class CE Distributable Amount" With respect to any
Distribution
Date, the sum of (i) the interest accrued on such Class CE
Certificate at its
Pass-Through Rate calculated on its Notional Amount less the amount
(without
duplication) of Cap Carryover Amounts paid pursuant to Section
4.02(b)(xlii),
(ii) any remaining Overcollateralization Release Amounts and (iii)
the amount
remaining in the Reserve Account after the distributions in Section
3.04(g)(i)
and (ii).
"Class CE Uncertificated Interest" The uncertificated Regular
Interest issued by REMIC 2 and held as an asset of REMIC A, as
described in the
Preliminary Statement hereto.
"Class M Certificate" Any one of the Certificates with an "M"
designated on the face thereof substantially in the form annexed
hereto as
Exhibit B-1, Exhibit B-2, Exhibit B-3, Exhibit B-4, Exhibit B-5,
Exhibit B-6,
Exhibit B-7, Exhibit B-8, Exhibit B-9, Exhibit B-10, Exhibit B-11,
Exhibit B-12
and Exhibit B-13, executed by the Securities Administrator on
behalf of the
Trust and authenticated and delivered by the Certificate Registrar,
representing
the right to distributions as set forth herein and therein.
"Class M Certificateholders" Collectively, the Holders of the
Class
M Certificates.
"Class M-1 Certificate Margin" For each Distribution Date (i) on
or
prior to the Optional Termination Date, [ ]% per annum, and (ii)
following the
Optional Termination Date, [ ]% per annum.
"Class M-1 Formula Rate" For each Distribution Date, a rate per
annum equal to the lesser of (a) One-Month LIBOR as of the related
LIBOR
Determination Date, plus the Class M-1 Certificate Margin and (b)
the Pool
Maximum Rate Cap.
"Class M-1 Principal Distribution Amount" As of any
Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Principal
Balances of
the Senior Certificates (after taking into account the payment of
the Senior
Principal Distribution Amount on such Distribution Date) and (ii)
the Principal
Balance of the Class M-1 Certificates immediately prior to such
Distribution
Date over (y) the lesser of (A) the product of (i) [ ]% and (ii)
the Pool
Balance as of the last day of the related Collection Period and (B)
the
Overcollateralization Floor.
"Class M-1 Realized Loss Amortization Amount" As to the Class
M-1
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-1 Certificates as of such
Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over
(ii) the sum
of the amounts described in Section 4.02(b)(i) through (iv) hereof,
in each case
for such Distribution Date.
"Class M-2 Certificate Margin" For each Distribution Date (i) on
or
prior to the Optional Termination Date, [ ]% per annum, and (ii)
following the
Optional Termination Date, [ ]% per annum.
"Class M-2 Formula Rate" For each Distribution Date, a rate per
annum equal to the lesser of (a) One-Month LIBOR as of the related
LIBOR
Determination Date, plus the Class M-2 Certificate Margin and (b)
the Pool
Maximum Rate Cap.
"Class M-2 Principal Distribution Amount" As of any
Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Principal
Balances of
the Senior Certificates (after taking into account the payment of
the Senior
Principal Distribution Amount on such Distribution Date), (ii) the
Principal
Balance of the Class M-1 Certificates (after taking into account
the payment of
the Class M-1 Principal Distribution Amount on such Distribution
Date) and (iii)
the Principal Balance of the Class M-2 Certificates immediately
prior to such
Distribution Date over (y) the lesser of (A) the product of (i) [
]% and (ii)
the Pool Balance as of the last day of the related Collection
Period and (B) the
Overcollateralization Floor.
"Class M-2 Realized Loss Amortization Amount" As to the Class
M-2
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-2 Certificates as of such
Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over
(ii) the sum
of the amounts described in Section 4.02(b)(i) through (vii)
hereof, in each
case for such Distribution Date.
"Class M-3 Certificate Margin" For each Distribution Date (i) on
or
prior to the Optional Termination Date, [ ]% per annum, and (ii)
following the
Optional Termination Date, [ ]% per annum.
"Class M-3 Formula Rate" For each Distribution Date, a rate per
annum equal to the lesser of (a) One-Month LIBOR as of the related
LIBOR
Determination Date, plus the Class M-3 Certificate Margin and (b)
the Pool
Maximum Rate Cap.
"Class M-3 Principal Distribution Amount" As of any
Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Principal
Balances of
the Senior Certificates (after taking into account the payment of
the Senior
Principal Distribution Amount on such Distribution Date), (ii) the
Principal
Balance of the Class M-1 Certificates (after taking into account
the payment of
the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking
into account
the payment of the Class M-2 Principal Distribution Amount on such
Distribution
Date), and (iv) the Principal Balance of the Class M-3 Certificates
immediately
prior to such Distribution Date over (y) the lesser of (A) the
product of (i) [
]% and (ii) the Pool Balance as of the last day of the related
Collection Period
and (B) the Overcollateralization Floor.
"Class M-3 Realized Loss Amortization Amount" As to the Class
M-3
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-3 Certificates as of such
Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over
(ii) the sum
of the amounts described in Section 4.02(b)(i) through (x) hereof,
in each case
for such Distribution Date.
"Class M-4 Certificate Margin" For each Distribution Date (i) on
or
prior to the Optional Termination Date, [ ]% per annum, and (ii)
following the
Optional Termination Date, [ ]% per annum.
"Class M-4 Formula Rate" For each Distribution Date, a rate per
annum equal to the lesser of (a) One-Month LIBOR as of the related
LIBOR
Determination Date, plus the Class M-4 Certificate Margin and (b)
the Pool
Maximum Rate Cap.
"Class M-4 Principal Distribution Amount" As of any
Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Principal
Balances of
the Senior Certificates (after taking into account the payment of
the Senior
Principal Distribution Amount on such Distribution Date), (ii) the
Principal
Balance of the Class M-1 Certificates (after taking into account
the payment of
the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking
into account
the payment of the Class M-2 Principal Distribution Amount on such
Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates
(after taking
into account the payment of the Class M-3 Principal Distribution
Amount on such
Distribution Date) and (v) the Principal Balance of the Class M-4
Certificates
immediately prior to such Distribution Date over (y) the lesser of
(A) the
product of (i) [ ]% and (ii) the Pool Balance as of the last day of
the related
Collection Period and (B) the Overcollateralization Floor.
"Class M-4 Realized Loss Amortization Amount" As to the Class
M-4
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-4 Certificates as of such
Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over
(ii) the sum
of the amounts described in Section 4.02(b)(i) through (xiii)
hereof, in each
case for such Distribution Date.
"Class M-5 Certificate Margin" For each Distribution Date (i) on
or
prior to the Optional Termination Date, [ ]% per annum, and (ii)
following the
Optional Termination Date, [ ]% per annum.
"Class M-5 Formula Rate" For each Distribution Date, a rate per
annum equal to the lesser of (a) One-Month LIBOR as of the related
LIBOR
Determination Date, plus the Class M-5 Certificate Margin and (b)
the Pool
Maximum Rate Cap.
"Class M-5 Principal Distribution Amount" As of any
Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Principal
Balances of
the Senior Certificates (after taking into account the payment of
the Senior
Principal Distribution Amount on such Distribution Date), (ii) the
Principal
Balance of the Class M-1 Certificates (after taking into account
the payment of
the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking
into account
the payment of the Class M-2 Principal Distribution Amount on such
Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates
(after taking
into account the payment of the Class M-3 Principal Distribution
Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4
Certificates
(after taking into account the payment of the Class M-4 Principal
Distribution
Amount on such Distribution Date) and (vi) the Principal Balance of
the Class
M-5 Certificates immediately prior to such Distribution Date over
(y) the lesser
of (A) the product of (i) [ ]% and (ii) the Pool Balance as of the
last day of
the related Collection Period and (B) the Overcollateralization
Floor.
"Class M-5 Realized Loss Amortization Amount" As to the Class
M-5
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-5 Certificates as of such
Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over
(ii) the sum
of the amounts described in Section 4.02(b)(i) through (xvi)
hereof, in each
case for such Distribution Date.
"Class M-6 Certificate Margin" For each Distribution Date (i) on
or
prior to the Optional Termination Date, [ ]% per annum, and (ii)
following the
Optional Termination Date, [ ]% per annum.
"Class M-6 Formula Rate" For each Distribution Date, a rate per
annum equal to the lesser of (a) One-Month LIBOR as of the related
LIBOR
Determination Date, plus the Class M-6 Certificate Margin and (b)
the Pool
Maximum Rate Cap.
"Class M-6 Principal Distribution Amount" As of any
Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Principal
Balances of
the Senior Certificates (after taking into account the payment of
the Senior
Principal Distribution Amount on such Distribution Date), (ii) the
Principal
Balance of the Class M-1 Certificates (after taking into account
the payment of
the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking
into account
the payment of the Class M-2 Principal Distribution Amount on such
Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates
(after taking
into account the payment of the Class M-3 Principal Distribution
Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4
Certificates
(after taking into account the payment of the Class M-4 Principal
Distribution
Amount on such Distribution Date), (vi) the Principal Balance of
the Class M-5
Certificates (after taking into account the payment of the Class
M-5 Principal
Distribution Amount on such Distribution Date) and (vii) the
Principal Balance
of the Class M-6 Certificates immediately prior to such
Distribution Date over
(y) the lesser of (A) the product of (i) [ ]% and (ii) the Pool
Balance as of
the last day of the related Collection Period and (B) the
Overcollateralization
Floor.
"Class M-6 Realized Loss Amortization Amount" As to the Class
M-6
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-6 Certificates as of such
Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over
(ii) the sum
of the amounts described in Section 4.02(b)(i) through (xix)
hereof, in each
case for such Distribution Date.
"Class M-7 Certificate Margin" For each Distribution Date (i) on
or
prior to the Optional Termination Date, [ ]% per annum, and (ii)
following the
Optional Termination Date, [ ]% per annum.
"Class M-7 Formula Rate" For each Distribution Date, a rate per
annum equal to the lesser of (a) One-Month LIBOR as of the related
LIBOR
Determination Date, plus the Class M-7 Certificate Margin and (b)
the Pool
Maximum Rate Cap.
"Class M-7 Principal Distribution Amount" As of any
Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Principal
Balances of
the Senior Certificates (after taking into account the payment of
the Senior
Principal Distribution Amount on such Distribution Date), (ii) the
Principal
Balance of the Class M-1 Certificates (after taking into account
the payment of
the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking
into account
the payment of the Class M-2 Principal Distribution Amount on such
Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates
(after taking
into account the payment of the Class M-3 Principal Distribution
Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4
Certificates
(after taking into account the payment of the Class M-4 Principal
Distribution
Amount on such Distribution Date), (vi) the Principal Balance of
the Class M-5
Certificates (after taking into account the payment of the Class
M-5 Principal
Distribution Amount on such Distribution Date), (vii) the Principal
Balance of
the Class M-6 Certificates (after taking into account the payment
of the Class
M-6 Principal Distribution Amount on such Distribution Date) and
(viii) the
Principal Balance of the Class M-7 Certificates immediately prior
to such
Distribution Date over (y) the lesser of (A) the product of (i) [
]% and (ii)
the Pool Balance as of the last day of the related Collection
Period and (B) the
Overcollateralization Floor.
"Class M-7 Realized Loss Amortization Amount" As to the Class
M-7
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-7 Certificates as of such
Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over
(ii) the sum
of the amounts described in Section 4.02(b)(i) through (xxii)
hereof, in each
case for such Distribution Date.
"Class M-8 Certificate Margin" For each Distribution Date (i) on
or
prior to the Optional Termination Date, [ ]% per annum, and (ii)
following the
Optional Termination Date, [ ]% per annum.
"Class M-8 Formula Rate" For each Distribution Date, a rate per
annum equal to the lesser of (a) One-Month LIBOR as of the related
LIBOR
Determination Date, plus the Class M-8 Certificate Margin and (b)
the Pool
Maximum Rate Cap.
"Class M-8
Principal Distribution Amount" As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Principal
Balances of
the Senior Certificates (after taking into account the payment of
the Senior
Principal Distribution Amount on such Distribution Date), (ii) the
Principal
Balance of the Class M-1 Certificates (after taking into account
the payment of
the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking
into account
the payment of the Class M-2 Principal Distribution Amount on such
Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates
(after taking
into account the payment of the Class M-3 Principal Distribution
Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4
Certificates
(after taking into account the payment of the Class M-4 Principal
Distribution
Amount on such Distribution Date), (vi) the Principal Balance of
the Class M-5
Certificates (after taking into account the payment of the Class
M-5 Principal
Distribution Amount on such Distribution Date), (vii) the Principal
Balance of
the Class M-6 Certificates (after taking into account the payment
of the Class
M-6 Principal Distribution Amount on such Distribution Date), (vii)
the
Principal Balance of the Class M-7 Certificates (after taking into
account the
payment of the Class M-7 Principal Distribution Amount on such
Distribution
Date) and (viii) the Principal Balance of the Class M-8
Certificates immediately
prior to such Distribution Date over (y) the lesser of (A) the
product of (i) [
]% and (ii) the Pool Balance as of the last day of the related
Collection Period
and (B) the Overcollateralization Floor.
"Class M-8 Realized Loss Amortization Amount" As to the Class
M-8
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-8 Certificates as of such
Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over
(ii) the sum
of the amounts described in Section 4.02(b)(i) through (xxv)
hereof, in each
case for such Distribution Date.
"Class M-9 Certificate Margin" For each Distribution Date (i) on
or
prior to the Optional Termination Date, [ ]% per annum, and (ii)
following the
Optional Termination Date, [ ]% per annum.
"Class M-9 Formula Rate" For each Distribution Date, a rate per
annum equal to the lesser of (a) One-Month LIBOR as of the related
LIBOR
Determination Date, plus the Class M-9 Certificate Margin and (b)
the Pool
Maximum Rate Cap.
"Class M-9 Principal Distribution Amount" As of any
Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Principal
Balances of
the Senior Certificates (after taking into account the payment of
the Senior
Principal Distribution Amount on such Distribution Date), (ii) the
Principal
Balance of the Class M-1 Certificates (after taking into account
the payment of
the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking
into account
the payment of the Class M-2 Principal Distribution Amount on such
Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates
(after taking
into account the payment of the Class M-3 Principal Distribution
Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4
Certificates
(after taking into account the payment of the Class M-4 Principal
Distribution
Amount on such Distribution Date), (vi) the Principal Balance of
the Class M-5
Certificates (after taking into account the payment of the Class
M-5 Principal
Distribution Amount on such Distribution Date), (vii) the Principal
Balance of
the Class M-6 Certificates (after taking into account the payment
of the Class
M-6 Principal Distribution Amount on such Distribution Date),
(viii) the
Principal Balance of the Class M-7 Certificates (after taking into
account the
payment of the Class M-7 Principal Distribution Amount on such
Distribution
Date), (ix) the Principal Balance of the Class M-8 Certificates
(after taking
into account the payment of the Class M-8 Principal Distribution
Amount on such
Distribution Date) and (x) the Principal Balance of the Class M-9
Certificates
immediately prior to such Distribution Date over (y) the lesser of
(A) the
product of (i) [ ]% and (ii) the Pool Balance as of the last day of
the related
Collection Period and (B) the Overcollateralization Floor.
"Class M-9 Realized Loss Amortization Amount" As to the Class
M-9
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-9 Certificates as of such
Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over
(ii) the sum
of the amounts described in Section 4.02(b)(i) through (xxviii)
hereof, in each
case for such Distribution Date.
"Class M-10 Certificate Margin" For each Distribution Date (i) on
or
prior to the Optional Termination Date, [ ]% per annum, and (ii)
following the
Optional Termination Date, [ ]% per annum.
"Class M-10 Formula Rate" For each Distribution Date, a rate
per
annum equal to the lesser of (a) One-Month LIBOR as of the related
LIBOR
Determination Date, plus the Class M-10 Certificate Margin and (b)
the Pool
Maximum Rate Cap.
"Class M-10 Principal Distribution Amount" As of any
Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Principal
Balances of
the Senior Certificates (after taking into account the payment of
the Senior
Principal Distribution Amount on such Distribution Date), (ii) the
Principal
Balance of the Class M-1 Certificates (after taking into account
the payment of
the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking
into account
the payment of the Class M-2 Principal Distribution Amount on such
Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates
(after taking
into account the payment of the Class M-3 Principal Distribution
Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4
Certificates
(after taking into account the payment of the Class M-4 Principal
Distribution
Amount on such Distribution Date), (vi) the Principal Balance of
the Class M-5
Certificates (after taking into account the payment of the Class
M-5 Principal
Distribution Amount on such Distribution Date), (vii) the Principal
Balance of
the Class M-6 Certificates (after taking into account the payment
of the Class
M-6 Principal Distribution Amount on such Distribution Date),
(viii) the
Principal Balance of the Class M-7 Certificates (after taking into
account the
payment of the Class M-7 Principal Distribution Amount on such
Distribution
Date), (ix) the Principal Balance of the Class M-8 Certificates
(after taking
into account the payment of the Class M-8 Principal Distribution
Amount on such
Distribution Date), (x) the Principal Balance of the Class M-9
Certificates
(after taking into account the payment of the Class M-9 Principal
Distribution
Amount on such Distribution Date) and (xi) the Principal Balance of
the Class
M-10 Certificates immediately prior to such Distribution Date over
(y) the
lesser of (A) the product of (i) [ ]% and (ii) the Pool Balance as
of the last
day of the related Collection Period and (B) the
Overcollateralization Floor.
"Class M-10 Realized Loss Amortization Amount" As to the Class
M-10
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-10 Certificates as of such
Distribution
Date and (y) the excess of (i) the Monthly Excess Cashflow Amount
over (ii) the
sum of the amounts described in Section 4.02(b)(i) through (xxxi)
hereof, in
each case for such Distribution Date.
"Class M-11 Certificate Margin" For each Distribution Date (i) on
or
prior to the Optional Termination Date, [ ]% per annum, and (ii)
following the
Optional Termination Date, [ ]% per annum.
"Class M-11 Formula Rate" For each Distribution Date, a rate
per
annum equal to the lesser of (a) One-Month LIBOR as of the related
LIBOR
Determination Date, plus the Class M-11 Certificate Margin and (b)
the Pool
Maximum Rate Cap.
"Class M-11 Principal Distribution Amount" As of any
Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Principal
Balances of
the Senior Certificates (after taking into account the payment of
the Senior
Principal Distribution Amount on such Distribution Date), (ii) the
Principal
Balance of the Class M-1 Certificates (after taking into account
the payment of
the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking
into account
the payment of the Class M-2 Principal Distribution Amount on such
Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates
(after taking
into account the payment of the Class M-3 Principal Distribution
Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4
Certificates
(after taking into account the payment of the Class M-4 Principal
Distribution
Amount on such Distribution Date), (vi) the Principal Balance of
the Class M-5
Certificates (after taking into account the payment of the Class
M-5 Principal
Distribution Amount on such Distribution Date), (vii) the Principal
Balance of
the Class M-6 Certificates (after taking into account the payment
of the Class
M-6 Principal Distribution Amount on such Distribution Date),
(viii) the
Principal Balance of the Class M-7 Certificates (after taking into
account the
payment of the Class M-7 Principal Distribution Amount on such
Distribution
Date), (ix) the Principal Balance of the Class M-8 Certificates
(after taking
into account the payment of the Class M-8 Principal Distribution
Amount on such
Distribution Date), (x) the Principal Balance of the Class M-9
Certificates
(after taking into account the payment of the Class M-9 Principal
Distribution
Amount on such Distribution Date), (xi) the Principal Balance of
the Class M-10
Certificates (after taking into account the payment of the Class
M-10 Principal
Distribution Amount on such Distribution Date) and (xii) the
Principal Balance
of the Class M-11 Certificates immediately prior to such
Distribution Date over
(y) the lesser of (A) the product of (i) [ ]% and (ii) the Pool
Balance as of
the last day of the related Collection Period and (B) the
Overcollateralization
Floor.
"Class M-11 Realized Loss Amortization Amount" As to the Class
M-11
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-11 Certificates as of such
Distribution
Date and (y) the excess of (i) the Monthly Excess Cashflow Amount
over (ii) the
sum of the amounts described in Section 4.02(b)(i) through (xxxiv)
hereof, in
each case for such Distribution Date.
"Class M-12 Certificate Margin" For each Distribution Date (i) on
or
prior to the Optional Termination Date, [ ]% per annum, and (ii)
following the
Optional Termination Date, [ ]% per annum.
"Class M-12 Formula Rate" For each Distribution Date, a rate
per
annum equal to the lesser of (a) One-Month LIBOR as of the related
LIBOR
Determination Date, plus the Class M-12 Certificate Margin and (b)
the Pool
Maximum Rate Cap.
"Class M-12 Principal Distribution Amount" As of any
Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Principal
Balances of
the Senior Certificates (after taking into account the payment of
the Senior
Principal Distribution Amount on such Distribution Date), (ii) the
Principal
Balance of the Class M-1 Certificates (after taking into account
the payment of
the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking
into account
the payment of the Class M-2 Principal Distribution Amount on such
Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates
(after taking
into account the payment of the Class M-3 Principal Distribution
Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4
Certificates
(after taking into account the payment of the Class M-4 Principal
Distribution
Amount on such Distribution Date), (vi) the Principal Balance of
the Class M-5
Certificates (after taking into account the payment of the Class
M-5 Principal
Distribution Amount on such Distribution Date), (vii) the Principal
Balance of
the Class M-6 Certificates (after taking into account the payment
of the Class
M-6 Principal Distribution Amount on such Distribution Date),
(viii) the
Principal Balance of the Class M-7 Certificates (after taking into
account the
payment of the Class M-7 Principal Distribution Amount on such
Distribution
Date), (ix) the Principal Balance of the Class M-8 Certificates
(after taking
into account the payment of the Class M-8 Principal Distribution
Amount on such
Distribution Date), (x) the Principal Balance of the Class M-9
Certificates
(after taking into account the payment of the Class M-9 Principal
Distribution
Amount on such Distribution Date), (xi) the Principal Balance of
the Class M-10
Certificates (after taking into account the payment of the Class
M-10 Principal
Distribution Amount on such Distribution Date), (xii) the Principal
Balance of
the Class M-11 Certificates (after taking into account the payment
of the Class
M-11 Principal Distribution Amount on such Distribution Date) and
(xiii) the
Principal Balance of the Class M-12 Certificates immediately prior
to such
Distribution Date over (y) the lesser of (A) the product of (i) [
]% and (ii)
the Pool Balance as of the last day of the related Collection
Period and (B) the
Overcollateralization Floor.
"Class M-12 Realized Loss Amortization Amount" As to the Class
M-12
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-12 Certificates as of such
Distribution
Date and (y) the excess of (i) the Monthly Excess Cashflow Amount
over (ii) the
sum of the amounts described in Section 4.02(b)(i) through (xxxvii)
hereof, in
each case for such Distribution Date.
"Class M-13 Certificate Margin" For each Distribution Date (i) on
or
prior to the Optional Termination Date, [ ]% per annum, and (ii)
following the
Optional Termination Date, [ ]% per annum.
"Class M-13 Formula Rate" For each Distribution Date, a rate
per
annum equal to the lesser of (a) One-Month LIBOR as of the related
LIBOR
Determination Date, plus the Class M-13 Certificate Margin and (b)
the Pool
Maximum Rate Cap.
"Class M-13 Principal Distribution Amount" As of any
Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Principal
Balances of
the Senior Certificates (after taking into account the payment of
the Senior
Principal Distribution Amount on such Distribution Date), (ii) the
Principal
Balance of the Class M-1 Certificates (after taking into account
the payment of
the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking
into account
the payment of the Class M-2 Principal Distribution Amount on such
Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates
(after taking
into account the payment of the Class M-3 Principal Distribution
Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4
Certificates
(after taking into account the payment of the Class M-4 Principal
Distribution
Amount on such Distribution Date), (vi) the Principal Balance of
the Class M-5
Certificates (after taking into account the payment of the Class
M-5 Principal
Distribution Amount on such Distribution Date), (vii) the Principal
Balance of
the Class M-6 Certificates (after taking into account the payment
of the Class
M-6 Principal Distribution Amount on such Distribution Date),
(viii) the
Principal Balance of the Class M-7 Certificates (after taking into
account the
payment of the Class M-7 Principal Distribution Amount on such
Distribution
Date), (ix) the Principal Balance of the Class M-8 Certificates
(after taking
into account the payment of the Class M-8 Principal Distribution
Amount on such
Distribution Date), (x) the Principal Balance of the Class M-9
Certificates
(after taking into account the payment of the Class M-9 Principal
Distribution
Amount on such Distribution Date), (xi) the Principal Balance of
the Class M-10
Certificates (after taking into account the payment of the Class
M-10 Principal
Distribution Amount on such Distribution Date), (xii) the Principal
Balance of
the Class M-11 Certificates (after taking into account the payment
of the Class
M-11 Principal Distribution Amount on such Distribution Date),
(xiii) the
Principal Balance of the Class M-12 Certificates (after taking into
account the
payment of the Class M-12 Principal Distribution Amount on such
Distribution
Date) and (xiv) the Principal Balance of the Class M-13
Certificates immediately
prior to such Distribution Date over (y) the lesser of (A) the
product of (i) [
]% and (ii) the Pool Balance as of the last day of the related
Collection Period
and (B) the Overcollateralization Floor.
"Class M-13 Realized Loss Amortization Amount" As to the Class
M-13
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-13 Certificates as of such
Distribution
Date and (y) the excess of (i) the Monthly Excess Cashflow Amount
over (ii) the
sum of the amounts described in Section 4.02(b)(i) through (xl)
hereof, in each
case for such Distribution Date.
"Class P Certificate" Any one of the Certificates with a "P"
designated on the face thereof substantially in the form annexed
hereto as
Exhibit C-2, executed by the Securities Administrator on behalf of
the Trust and
authenticated and delivered by the Certificate Registrar,
representing the right
to distributions as set forth herein and therein.
"Class P Certificateholders" The holders of the Class P
Certificates.
"Class R Certificate" The Class R Certificate executed by the
Securities Administrator on behalf of the Trust, and authenticated
and delivered
by the Certificate Registrar, substantially in the form annexed
hereto as
Exhibit C-3 and evidencing the ownership of the Residual Interest
in each of
REMIC 1 and REMIC 2. The Class R Certificate represents the
ownership of the
Class R-1 Interest and the Class R-2 Interest.
"Class R-1 Interest": The uncertificated residual interest in
REMIC
1.
"Class R-2 Interest": The uncertificated residual interest in
REMIC
2.
"Class R-X Certificate" The Class R-X Certificate executed by
the
Securities Administrator on behalf of the Trust, and authenticated
and delivered
by the Certificate Registrar, substantially in the form annexed
hereto as
Exhibit C-4 and evidencing the ownership of the Residual Interest
in REMIC A.
"Closing Date" [ ], 200 .
"Code" The Internal Revenue Code of 1986, as it may be amended
from
time to time.
"Collection Account" The account or accounts created and
maintained
by the Servicer pursuant to Section 3.04(a), which shall be
entitled "Collection
Account, Wells Fargo Bank, N.A., as Servicer for HSBC Bank USA,
National
Association, as Trustee, in trust for registered Holders of Wells
Fargo Home
Equity Asset-Backed Securities 200 - Trust, Home Equity
Asset-Backed
Certificates, Series 200 - ," and which must be an Eligible
Account.
"Collection Period" With respect to any Distribution Date, the
period from the second day of the calendar month preceding the
month in which
such Distribution Date occurs through the first day of the month in
which such
Distribution Date occurs.
"Commission" The United States Securities and Exchange
Commission.
"Compensating Interest" As defined in Section 3.22 hereof.
"Condemnation Proceeds" All awards or settlements in respect of
a
taking of a Mortgaged Property by exercise of the power of eminent
domain or
condemnation.
"Corporate Trust Office" With respect to the Trustee, the
principal
corporate trust office of the Trustee at which at any particular
time its
corporate trust business in connection with this Agreement shall
be
administered, which office at the date of the execution of this
instrument is
located at 452 Fifth Avenue, New York, New York 10018, Attention:
WFHET 200 - or
at such other address as the Trustee may designate from time to
time by notice
to the Certificateholders, the Depositor, the Securities
Administrator and the
Servicer. With respect to the Securities Administrator, the
corporate trust
office of the Securities Administrator at which at any particular
time its
corporate trust business in connection with this Agreement shall
be
administered, which office at the date of the execution of this
instrument is
located at (i) for certificate transfer purposes, Wells Fargo
Center, Sixth
Street and Marquette Avenue, Minneapolis, Minnesota, 55479-0113,
Attention:
Client Manager-WFHET, Series 200 - and (ii) for all other purposes,
9062 Old
Annapolis Road, Columbia, Maryland 21045, Attention: Client
Manager-WFHET,
Series 200 - or at such other address as the Securities
Administrator may
designate from time to time by notice to the Certificateholders,
the Depositor,
the Trustee and the Servicer.
"Corresponding Classes" With respect to REMIC 1 and REMIC 2,
the
following Classes shall be Corresponding Classes:
---------------------------------------------------------------------------
Corresponding REMIC 1 Classes
Corresponding REMIC 2 Classes
---------------------------------------------------------------------------
LT1AI1A
Class AI-1A Certificates
LT1AI1B
Class AI-1B Certificates
LT1AII1
Class AII-1 Certificates
LT1AII2
Class AII-2 Certificates
LT1AII3
Class AII-3 Certificates
LT1M1
Class M-1 Certificates
LT1M2
Class M-2 Certificates
LT1M3
Class M-3 Certificates
LT1M4
Class M-4 Certificates
LT1M5
Class M-5
Certificates
LT1M6
Class M-6 Certificates
LT1M7
Class M-7 Certificates
LT1M8
Class M-8 Certificates
LT1M9
Class M-9 Certificates
LT1M10
Class M-10 Certificates
LT1M11
Class M-11 Certificates
LT1M12
Class M-12 Certificates
LT1M13
Class M-13 Certificates
"Credit Risk Management Agreement" The Credit Risk Management
Agreement between the Servicer and the Credit Risk Manager dated [
], 200
.
"Credit Risk Manager" [
].
"Credit Risk Manager Fee" The fee payable to the Credit Risk
Manager
on each Distribution Date for its services as Credit Risk Manager,
in an amount
equal to the product of (i) one-twelfth of the Credit Risk Manager
Fee Rate and
(ii) the Pool Balance as of the opening of business on the first
day of the
related Collection Period.
"Credit Risk Manager Fee Rate" With respect to any Distribution
Date, [ ]% per annum.
"Current Interest Shortfall" With respect to any Distribution
Date,
the sum of (i) the aggregate amount of Relief Act Interest
Shortfalls, (ii) the
aggregate amount of Prepayment Interest Shortfalls attributable to
partial
Principal Prepayments and (iii) the amount, if any, by which (x)
the aggregate
amount of Prepayment Interest Shortfalls attributable to Principal
Prepayments
in full exceeds (y) the Compensating Interest for such Distribution
Date.
"Custodial Agreement" That certain Custodial Agreement, dated as
of
[ ], 200 , among the Custodian, the Depositor, the Servicer and the
Trustee, in
the form of Exhibit R attached hereto.
"Custodian" Wells Fargo Bank, as custodian pursuant to the
Custodial
Agreement, and any successor custodian, if any, hereafter appointed
by the
Trustee pursuant to Section 8.16. The Custodian may (but need not)
be the
Trustee, the Securities Administrator or the Servicer or any Person
directly or
indirectly controlling or controlled by or under common control of
any of them.
"Cut-off Date" With respect to each Mortgage Loan, the Due Date
occurring in [ ] 20 .
"Cut-off Date Principal Balance" With respect to any Mortgage
Loan,
the unpaid principal balance thereof as of the applicable Cut-off
Date after
giving effect to any Monthly Payment due on such date and to the
application of
funds received or advanced on or before such date (or as of the
applicable date
of substitution with respect to an Eligible Substitute Mortgage
Loan).
"Debt Service Reduction" With respect to any Mortgage Loan, a
reduction in the scheduled Monthly Payment for such Mortgage Loan
by a court of
competent jurisdiction in a proceeding under the Bankruptcy Code,
except such a
reduction resulting from a Deficient Valuation.
"Defective Mortgage Loan" A Mortgage Loan replaced or to be
replaced
by one or more Eligible Substitute Mortgage Loans.
"Deficient Valuation" With respect to any Mortgage Loan, a
valuation
of the related Mortgaged Property by a court of competent
jurisdiction in an
amount less than the then outstanding principal balance of the
Mortgage Loan, or
any reduction in the amount of principal to be paid in connection
with any
scheduled Monthly Payment that results in a permanent forgiveness
of principal,
which valuation results from a proceeding initiated under the
Bankruptcy Code.
"Definitive Certificates" As defined in Section 5.02(c) hereof.
"Delinquent" Any Mortgage Loan with respect to which the
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.
"Depositor" Wells Fargo Asset Securities Corporation, a
Delaware
corporation, or any successor in interest.
"Depository" The initial depository shall be The Depository
Trust
Company, whose nominee is Cede & Co., or any other organization
registered as a
"clearing agency" pursuant to Section 17A of the Exchange Act. The
Depository
shall initially be the registered Holder of the Book-Entry
Certificates. The
Depository shall at all times be a "clearing corporation" as
defined in Section
8-102(a)(5) of the Uniform Commercial Code of the State of New
York.
"Depository Participant" A broker, dealer, bank or other
financial
institution or other person for whom from time to time a Depository
effects
book-entry transfers and pledges of securities deposited with the
Depository.
"Determination Date" With respect to any Distribution Date, the
17th
day of the calendar month in which such Distribution Date occurs
or, if such
17th day is not a Business Day, the Business Day immediately
preceding such 17th
day.
"Disqualified Organization" A "disqualified organization" under
Section 860E of the Code, which as of the Closing Date is any of:
(i) the United
States, any state or political subdivision thereof, any possession
of the United
States, any foreign government, any international organization, or
any agency or
instrumentality of any of the foregoing, (ii) any organization
(other than a
cooperative described in Section 521 of the Code) which is exempt
from the tax
imposed by Chapter 1 of the Code unless such organization is
subject to the tax
imposed by Section 511 of the Code, (iii) any organization
described in Section
1381(a)(2)(C) of the Code, or (iv) any other Person so designated
by the
Securities Administrator based upon an Opinion of Counsel provided
by nationally
recognized counsel to the Securities Administrator that the holding
of an
ownership interest in a Class R or Class R-X Certificate by such
Person may
cause the Trust Fund or any Person having an ownership interest in
any Class of
Certificates (other than such Person) to incur liability for any
federal tax
imposed under the Code that would not otherwise be imposed but for
the transfer
of an ownership interest in a Class R or Class R-X Certificate to
such Person. A
corporation will not be treated as an instrumentality of the United
States or of
any state or political subdivision thereof if all of its activities
are subject
to tax and a majority of its board of directors is not selected by
a
governmental unit. The term "United States," "state" and
"international
organization" shall have the meanings set forth in Section 7701 of
the Code.
"Distribution Account" The trust account or accounts created
and
maintained by the Securities Administrator pursuant to Section
3.04(b), which
shall be entitled "Distribution Account, Wells Fargo Bank, N.A., as
Securities
Administrator, in trust for the registered Holders of Wells Fargo
Home Equity
Asset-Backed Securities 200 - Trust, Home Equity Asset-Backed
Certificates,
Series 200 - ," and which must be an Eligible Account.
"Distribution Date" The 25th day of any calendar month, or if
such
25th day is not a Business Day, the Business Day immediately
following such 25th
day, commencing in [ ] 20 .
"Distribution Date Statement" As defined in Section 4.06(a)
hereof.
Document Transfer Date: The 60th day following the occurrence of
a
Document Transfer Event.
Document Transfer Event: The occurrence of either of the
following:
(i) Wells Fargo Bank is no longer the Servicer of any of the
Mortgage Loans or
(ii) the senior, unsecured long-term debt rating of Wells Fargo
& Company is
less than "BBB-" by [ ].
"Due Date" With respect to each Mortgage Loan, the day of the
calendar month on which the Monthly Payment for such Mortgage Loan
was due in
accordance with the terms of the related Mortgage Note, exclusive
of any grace
period.
"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 short-term unsecured debt obligations of such holding
company) are
rated [ ] by [ ] and [ ] by [ ] (or comparable ratings if [ ] and [
] are not
the Rating Agencies) by each of the Rating Agencies at the time any
amounts are
held on deposit therein, (ii) an account or accounts the deposits
in which are
fully insured by the FDIC, (iii) a trust account or accounts
maintained with the
trust department of a federal or state chartered depository
institution,
national banking association or trust company acting in its
fiduciary capacity
or (iv) an account otherwise acceptable to each Rating Agency
without reduction
or withdrawal of their then current ratings of the Certificates as
evidenced by
a letter from each Rating Agency to the Securities Administrator
and the
Trustee. Eligible Accounts may bear interest.
"Eligible Investments" Any one or more of the following
obligations
or securities acquired at a purchase price of not greater than par,
regardless
of whether issued or managed by the Depositor, the Servicer, the
Securities
Administrator, the Trustee or any of their respective Affiliates or
for which an
Affiliate of the Trustee or the Securities Administrator serves as
an advisor:
(i) direct obligations of, or obligations fully guaranteed as
to timely payment of principal and interest by, the United States
or
any agency or instrumentality thereof, provided such obligations
are
backed by the full faith and credit of the United States;
(ii) (A) demand and time deposits in, certificates of deposit
of, bankers' acceptances issued by or federal funds sold by any
depository institution or trust company (including the Trustee,
the
Securities Administrator or their respective agents acting in
their
respective commercial capacities) incorporated under the laws of
the
United States of America or any state thereof and subject to
supervision and examination by federal and/or state authorities,
so
long as, at the time of such investment or contractual
commitment
providing for such investment, such depository institution or
trust
company or its ultimate parent has a short term uninsured debt
rating in one of the two highest available rating categories of [
]
and the highest available rating category of [ ] and provided
that
each such investment has an original maturity of no more than
365
days and (B) any other demand or time deposit or deposit which
is
fully insured by the FDIC;
(iii) repurchase obligations with a term not to exceed 30 days
with respect to any security described in clause (i) above and
entered into with a depository institution or trust company
(acting
as principal) rated [ ] or higher by [ ] and [ ], provided,
however,
that collateral transferred pursuant to such repurchase
obligation
must be of the type described in clause (i) above and must (A)
be
valued daily at current market prices plus accrued interest or
(B)
pursuant to such valuation, be equal, at all times, to 105% of
the
cash transferred by the Trustee or the Securities Administrator
in
exchange for such collateral and (C) be delivered to the
Trustee,
the Securities Administrator or, if the Trustee or the
Securities
Administrator is supplying the collateral, an agent for the
Trustee
or the Securities Administrator, as the case may be, in such a
manner as to accomplish perfection of a security interest in
the
collateral by possession of certificated securities;
(iv) securities bearing interest or sold at a discount that
are issued by any corporation incorporated under the laws of
the
United States of America or any State thereof and that are rated
by
each Rating Agency in its highest long-term unsecured rating
categories at the time of such investment or contractual
commitment
providing for such investment;
(v) commercial paper (including both non-interest-bearing
discount obligations and interest-bearing obligations payable
on
demand or on a specified date not more than 30 days after the
date
of acquisition thereof) that is rated by each Rating Agency in
its
highest short-term unsecured debt rating available at the time
of
such investment;
(vi) units of money market funds registered under the
Investment Company Act of 1940 (including funds managed or
advised
by the Trustee or the Securities Administrator or affiliates
thereof) that, if rated by each Rating Agency, are rated in its
highest rating category (if so rated by such Rating Agency);
and
(vii) if previously confirmed in writing to the Trustee and
the Securities Administrator, any other demand, money market or
time
deposit, or any other obligation, security or investment, as may
be
acceptable to the Rating Agencies in writing as an eligible
investment of funds backing securities having ratings equivalent
to
its highest initial rating of the Senior Certificates;
provided, that no instrument described hereunder shall evidence
either the right to receive (a) only interest with respect to the
obligations
underlying such instrument or (b) both principal and interest
payments derived
from obligations underlying such instrument and the interest and
principal
payments with respect to such instrument provide a yield to
maturity at par
greater than 120% of the yield to maturity at par of the underlying
obligations.
"Eligible Substitute Mortgage Loan" A mortgage loan substituted
for
a Defective Mortgage Loan pursuant to the terms of this Agreement
which must, on
the date of such substitution, (i) have an outstanding principal
balance, after
application of all scheduled payments of principal and interest due
during or
prior to the month of substitution, not in excess of, the
outstanding principal
balance of the Defective Mortgage Loan as of the Due Date in the
calendar month
during which the substitution occurs, (ii) have a Mortgage Interest
Rate, with
respect to a Fixed Rate Mortgage Loan, not less than the Mortgage
Interest Rate
of the Defective Mortgage Loan and not more than 1% in excess of
the Mortgage
Interest Rate of such Defective Mortgage Loan, (iii) if an
Adjustable Rate
Mortgage Loan, have a Rate Ceiling not less than the Rate Ceiling
for the
Defective Mortgage Loan, (iv) if an Adjustable Rate Mortgage Loan,
have a
Minimum Mortgage Interest Rate not less than the Minimum Mortgage
Interest Rate
of the Defective Mortgage Loan, (v) if an Adjustable Rate Mortgage
Loan, have a
Gross Margin equal to or greater than the Gross Margin of the
Defective Mortgage
Loan, (vi) if an Adjustable Rate Mortgage Loan, have the same Index
and
frequency of adjustment as the Defective Mortgage Loan (vii) if an
Adjustable
Rate Mortgage Loan, have a next Adjustment Date not more than three
months later
than the next Adjustment Date on the Defective Mortgage Loan,
(viii) have an
original term to maturity not greater than (and not more than one
year less
than) that of the Defective Mortgage Loan, (ix) be current as of
the date of
substitution, (x) have a Loan-to-Value Ratio equal to or lower than
the
Loan-to-Value Ratio of the Defective Mortgage Loan, (xi) have a
risk grading at
least equal to the risk grading assigned on the Defective Mortgage
Loan, (xii)
have the same lien priority as the Defective Mortgage Loan; (xiii)
have a
Prepayment Penalty at least equal in amount and duration of that of
the
Defective Mortgage Loan and (xiv) conform to each representation
and warranty
set forth in Section 2.04 hereof applicable to the Defective
Mortgage Loan. In
the event that one or more mortgage loans are substituted for one
or more
Defective Mortgage Loans, the amounts described in clause (i)
hereof shall be
determined on the basis of aggregate principal balance, the
Mortgage Interest
Rates described in clause (ii) hereof shall be determined on the
basis of
weighted average Mortgage Interest Rates, the risk gradings
described in clause
(xi) hereof shall be satisfied as to each such mortgage loan, the
terms
described in clause (viii) hereof shall be determined on the basis
of weighted
average remaining term to maturity, the Loan-to-Value Ratios
described in clause
(x) hereof shall be satisfied as to each such mortgage loan and,
except to the
extent otherwise provided in this sentence, the representations and
warranties
described in clause (xiv) hereof must be satisfied as to each
Eligible
Substitute Mortgage Loan or in the aggregate, as the case may be.
Any Defective
Mortgage Loan that is a Group I Mortgage Loan or Group II Mortgage
Loan must be
replaced by an Eligible Substitute Mortgage Loan that will be a
Group I Mortgage
Loan or Group II Mortgage Loan, as applicable.
"ERISA" The Employee Retirement Income Security Act of 1974, as
amended.
"ERISA Restricted Certificates" Any of the Class M-12, Class
M-13,
Class CE, Class P, Class R and Class R-X Certificates.
"Escrow Account" The account or accounts created and maintained
pursuant to Section 3.06.
"Escrow Agreement" An agreement between a Mortgagor and the
Servicer
relating to accounts constituting taxes and/or fire and hazard
insurance
premiums required to be escrowed.
"Escrow Payments" The amounts constituting taxes and/or fire
and
hazard insurance premiums required to be escrowed to an Escrow
Agreement.
"Estate in Real Property" A fee simple estate in a parcel of
real
property.
"Exchange Act" The Securities Exchange Act of 1934, as amended.
"Expense Fee Rate" The sum of (i) the Servicing Fee Rate and
(ii)
the Credit Risk Manager Fee Rate.
"Extended Period" As defined in Section 9.04(b).
"Extra Principal Distribution Amount" As of any Distribution
Date,
the lesser of (x) the Monthly Excess Interest Amount for such
Distribution Date,
after reduction (but not below zero) by any Current Interest
Shortfall and (y)
the Overcollateralization Deficiency for such Distribution
Date.
"FDIC" Federal Deposit Insurance Corporation or any successor
thereto.
"Fidelity Bond" Shall have the meaning assigned thereto in
Section
3.12.
"Fixed Rate Mortgage Loan" A Mortgage Loan which has a constant
annual rate at which interest accrues in accordance with the
provisions of the
related Mortgage Note.
"Foreclosure Price" The amount reasonably expected to be
received
from the sale of the related Mortgaged Property net of any expenses
associated
with foreclosure proceedings.
"Form 8-K" A Current Report on Form 8-K under the Exchange Act.
"Form 8-K Disclosure Information" As defined in Section
3.28(c).
"Form 10-D" An Asset-Backed Issuer Distribution Report on Form
10-D
under the Exchange Act.
"Form 10-K" An Annual Report on Form 10-K under the Exchange
Act.
"Form 10-K Filing Deadline" As defined in Section 3.28(b).
"Form 15" A Form 15 Suspension Notification under the Exchange
Act.
"Formula Rate" Any of the Class AI-1A Formula Rate, the Class AI-1B
Formula
Rate, the Class AII-1 Formula Rate, the Class AII-2 Formula Rate,
the Class
AII-3 Formula Rate, the Class M-1 Formula Rate, the Class M-2
Formula Rate, the
Class M-3 Formula Rate, the Class M-4 Formula Rate, the Class M-5
Formula Rate,
the Class M-6 Formula Rate, the Class M-7 Formula Rate, the Class
M-8 Formula
Rate, the Class M-9 Formula Rate, the Class M-10 Formula Rate, the
Class M-11
Formula Rate, the Class M-12 Formula Rate and the Class M-13
Formula Rate.
"Grantor Trust" That portion of the Trust exclusive of REMIC 1,
REMIC 2 and REMIC A consisting of (a) the Prepayment Penalties, any
Originator
Prepayment Penalty Payment Amounts, any Servicer Prepayment Penalty
Payment
Amounts, proceeds thereof in the Custodial Account or Distribution
Account and
the right of the Class P Certificateholders to receive such
Prepayment
Penalties, Originator Prepayment Penalty Payment Amounts and
Servicer Prepayment
Penalty Payment Amounts, (b) the right of the Certificates (other
than the Class
CE, Class P and Residual Certificates) to receive Cap Carryover
Amounts, (c) the
Yield Maintenance Agreement, the Reserve Account and the beneficial
interest of
the Class CE Certificates with respect thereto and (d) the
obligation of the
Class CE Certificates to pay Cap Carryover Amounts.
"Gross Margin" With respect to each Adjustable Rate Mortgage
Loan,
the fixed percentage set forth in the related Mortgage Note that is
added to the
Index on each Adjustment Date in accordance with the terms of the
related
Mortgage Note used to determine the Mortgage Interest Rate for such
Mortgage
Loan.
"Group I Cap" As of any Distribution Date and the Class AI
Certificates, a per annum rate (adjusted by multiplying such rate
by a fraction
equal to 30 over the actual number of days in the related Interest
Accrual
Period) equal to the Weighted Average Net Mortgage Interest Rate
for the Group I
Mortgage Loans.
"Group I Interest Remittance Amount" As of any Distribution
Date,
the sum, without duplication, of (i) all interest due and collected
with respect
to the related Collection Period on the Group I Mortgage Loans
received by the
Servicer on or prior to the Determination Date for such
Distribution Date and
any interest advanced by the Servicer or the Trustee on the Group I
Mortgage
Loans with respect to the related Collection Period (less the
Servicing Fee,
amounts available for reimbursement of Advances and Servicing
Advances pursuant
to Section 3.05 and expenses reimbursable pursuant to Section 6.03,
amounts
reimbursable or payable to the Trustee pursuant to this Agreement,
including,
without limitation, Sections 7.01 and 8.05 and amounts reimbursable
or payable
to the Securities Administrator pursuant to this Agreement,
including, without
limitation, Sections 8.05 and 9.01(c)), (ii) all Compensating
Interest paid by
the Servicer on the related Distribution Date with respect to such
Group I
Mortgage Loans, (iii) the portion of any payment in connection with
any
Principal Prepayment, substitution, Purchase Price, Termination
Price, Insurance
Proceeds or Net Liquidation Proceeds relating to interest with
respect to such
Group I Mortgage Loans received during the related Prepayment
Period and (iv)
the portion of any Reimbursement Amount relating to interest on
such Group I
Mortgage Loans received during the related Prepayment Period.
"Group I Maximum Rate Cap" With respect to any Distribution Date
and
for the Class AI Certificates, a per annum rate (adjusted by
multiplying such
rate by a fraction equal to 30 over the actual number of days in
the related
Interest Accrual Period) equal to the average of the Net Rate
Ceilings for the
Adjustable Rate Mortgage Loans which are Group I Mortgage Loans and
the Net
Mortgage Interest Rates for the Fixed Rate Mortgage Loans which are
Group I
Mortgage Loans, weighted on the basis of the unpaid principal
balances of the
Group I Mortgage Loans as of the first day of the related
Collection Period.
"Group I Mortgage Loan" Each Mortgage Loan identified as a Group
I
Mortgage Loan on the Mortgage Loan Schedule.
"Group I Overcollateralization Floor" With respect to any
Distribution Date, the amount by which the aggregate unpaid
principal balance of
the Group I Mortgage Loans as of the last day of the related
Collection Period
exceeds the product of (i) [ ]% and (ii) the aggregate unpaid
principal balance
of the Group I Mortgage Loans on the Cut-off Date.
"Group I Principal Distribution Amount" With respect to any
Distribution Date, the product of the Group I Principal Percentage
and the
Principal Distribution Amount.
"Group I Principal Percentage" With respect to any Distribution
Date
and any Class AI Certificates, the percentage equivalent to a
fraction, the
numerator of which is the Principal Remittance Amount attributable
to the Group
I Mortgage Loans for such Distribution Date and the denominator of
which is the
Principal Remittance Amount for such Distribution Date.
"Group I Senior Principal Distribution Amount" With respect to
any
Distribution Date, the excess of (a) the aggregate Principal
Balance of the
Class AI Certificates immediately prior to such Distribution Date
over (b) the
lesser of (x) the product of (1) [ ]% and (2) the aggregate unpaid
principal
balance of the Group I Mortgage Loans as of the last day of the
related
Collection Period and (y) the Group I Overcollateralization
Floor.
"Group II Cap" As of any Distribution Date and the Class AII
Certificates, a per annum rate (adjusted by multiplying such rate
by a fraction
equal to 30 over the actual number of days in the related Interest
Accrual
Period) equal to the Weighted Average Net Mortgage Interest Rate
for the Group
II Mortgage Loans.
"Group II Interest Remittance Amount" As of any Distribution
Date,
the sum, without duplication, of (i) all interest due and collected
with respect
to the related Collection Period on the Group II Mortgage Loans
received by the
Servicer on or prior to the Determination Date for such
Distribution Date and
any interest advanced by the Servicer or the Trustee on the Group
II Mortgage
Loans with respect to the related Collection Period (less the
Servicing Fee,
amounts available for reimbursement of Advances and Servicing
Advances pursuant
to Section 3.05 and expenses reimbursable pursuant to Section 6.03,
amounts
reimbursable or payable to the Trustee pursuant to this Agreement,
including,
without limitation, Sections 7.01 and 8.05 and amounts reimbursable
or payable
to the Securities Administrator pursuant to this Agreement,
including, without
limitation, Sections 8.05 and 9.01(c)), (ii) all Compensating
Interest paid by
the Servicer on the related Distribution Date with respect to such
Group II
Mortgage Loans, (iii) the portion of any payment in connection with
any
Principal Prepayment, substitution, Purchase Price, Termination
Price, Insurance
Proceeds or Net Liquidation Proceeds relating to interest with
respect to such
Group II Mortgage Loans received during the related Prepayment
Period and (iv)
the portion of any Reimbursement Amount relating to interest on
such Group II
Mortgage Loans received during the related Prepayment Period.
"Group II Maximum Rate Cap" With respect to any Distribution
Date
and for the Class AII Certificates, a per annum rate (adjusted by
multiplying
such rate by a fraction equal to 30 over the actual number of days
in the
related Interest Accrual Period) equal to the average of the Net
Rate Ceilings
for the Adjustable Rate Mortgage Loans which are Group II Mortgage
Loans and the
Net Mortgage Interest Rates for the Fixed Rate Mortgage Loans which
are Group II
Mortgage Loans, weighted on the basis of the unpaid principal
balances of the
Group II Mortgage Loans as of the first day of the related
Collection Period.
"Group II Mortgage Loan" Each Mortgage Loan identified as a Group
II
Mortgage Loan on the Mortgage Loan Schedule.
"Group II Overcollateralization Floor" With respect to any
Distribution Date, the amount by which the aggregate unpaid
principal balance of
the Group II Mortgage Loans as of the last day of the related
Collection Period
exceeds the product of (i) [ ]% and (ii) the aggregate unpaid
principal balance
of the Group II Mortgage Loans on the Cut-off Date.
"Group II Principal Distribution Amount" With respect to any
Distribution Date, the product of the Group II Principal Percentage
and the
Principal Distribution Amount.
"Group II Principal Percentage" With respect to any
Distribution
Date and any Class AII Certificates, the percentage equivalent to a
fraction,
the numerator of which is the Principal Remittance Amount
attributable to the
Group II Mortgage Loans for such Distribution Date and the
denominator of which
is the Principal Remittance Amount for such Distribution Date.
"Group II Senior Principal Distribution Amount" With respect to
any
Distribution Date, the excess of (a) the aggregate Principal
Balance of the
Class AII Certificates immediately prior to such Distribution Date
over (b) the
lesser of (x) the product of (1) [ ]% and (2) the aggregate unpaid
principal
balance of the Group II Mortgage Loans as of the last day of the
related
Collection Period and (y) the Group II Overcollateralization
Floor.
"Group Subordinate Amount" With respect to any Distribution Date
and
(i) Loan Group I, the greater of zero and the excess of the
aggregate unpaid
principal balance of the Group I Mortgage Loans as of the first day
of the
related Collection Period over the aggregate Principal Balance of
the Class AI
Certificates immediately prior to such Distribution Date and (ii)
Loan Group II,
the greater of zero and the excess of the aggregate unpaid
principal balance of
the Group II Mortgage Loans as of the first day of the related
Collection Period
over the aggregate Principal Balance of the Class AII Certificates
immediately
prior to such Distribution Date.
"Independent" When used with respect to any specified Person,
any
such Person who (i) is in fact independent of the Depositor, the
Securities
Administrator, the Trustee, the Servicer and their respective
Affiliates, (ii)
does not have any direct financial interest in or any material
indirect
financial interest in the Depositor, the Securities Administrator,
the Trustee
or the Servicer, or any Affiliate thereof, and (iii) is not
connected with the
Depositor, the Securities Administrator, the Trustee or the
Servicer, or any
Affiliate thereof, as an officer, employee, promoter, underwriter,
trustee,
partner, director or Person performing similar functions; provided,
however,
that a Person shall not fail to be Independent of the Depositor,
the Securities
Administrator, the Trustee or the Servicer, or any Affiliate
thereof, merely
because such Person is the beneficial owner of 1% or less of any
class of
securities issued by the Depositor, the Securities Administrator,
the Trustee or
the Servicer, or any Affiliate thereof, as the case may be.
"Index" With respect to each Adjustable Rate Mortgage Loan and
with
respect to each related Adjustment Date, the index as specified in
the related
Mortgage Note.
"Initial Overcollateralization Amount" $[ ].
"Initial Principal Balance" With respect to any Certificate of
a
Class other than a Class CE, Class P or Residual Certificate, the
amount
designated "Initial Principal Balance" on the face thereof.
"Insurance Proceeds" Proceeds of any title policy, hazard policy
or
other insurance policy covering a Mortgage Loan, to the extent such
proceeds are
not to be applied to the restoration of the related Mortgaged
Property or
released to the Mortgagor in accordance with the procedures that
the Servicer
would follow in servicing mortgage loans held for its own account,
subject to
the terms and conditions of the related Mortgage Note and
Mortgage.
"Interest Accrual Period" With respect to any Distribution Date,
the
period from and including the preceding Distribution Date to the
day prior to
the current Distribution Date (or, in the case of the first
Distribution Date,
the period from [ ], 200 through [ ], 20 ).
"Interest Carry Forward Amount" For any Class of Certificates
(other
than the Class CE, Class P and Residual Certificates) and any
Distribution Date,
the sum of (a) the excess, if any, of the Accrued Certificate
Interest for the
prior Distribution Date and any Interest Carry Forward Amount for
the prior
Distribution Date, over the amount in respect of interest actually
distributed
on such Class on such prior Distribution Date and (b) interest on
such excess at
the applicable Pass-Through Rate on the basis of the actual number
of days
elapsed since the prior Distribution Date.
"Interest Percentage" With respect to any Class of Certificates
and
any Distribution Date, the ratio (expressed as a decimal carried to
at least six
places) of the Accrued Certificate Interest for such Class to the
sum of the
Accrued Certificate Interest for all Classes, in each case with
respect to such
Distribution Date, without regard to Current Interest
Shortfalls.
"Interest Remittance Amount" As of any Determination Date, the
sum
of the Group I Interest Remittance Amount and the Group II Interest
Remittance
Amount.
"Late Collections" With respect to any Mortgage Loan, all
amounts
received subsequent to the Determination Date immediately following
any related
Collection Period, whether as late payments of Monthly Payments or
as Insurance
Proceeds, Condemnation Proceeds, Liquidation Proceeds or otherwise,
which
represent late payments or collections of principal and/or interest
due (without
regard to any acceleration of payments under the related Mortgage
and Mortgage
Note) but delinquent on a contractual basis for such Collection
Period and not
previously recovered.
"LIBOR Business Day" Any day on which banks in London, England
and
the City of New York are open and conducting transactions in
foreign currency
and exchange.
"LIBOR Determination Date" With respect to any Floating Rate
Class,
(i) for the first Distribution Date, the second LIBOR Business Day
preceding the
Closing Date and (ii) for each subsequent Distribution Date, the
second LIBOR
Business Day prior to the immediately preceding Distribution
Date.
"Liquidated Mortgage Loan" As to any Distribution Date, any
Mortgage
Loan in respect of which the Servicer has determined, in accordance
with the
servicing procedures specified herein, as of the end of the related
Prepayment
Period, that all Liquidation Proceeds, Condemnation Proceeds and
Insurance
Proceeds which it expects to recover with respect to the
liquidation of the
Mortgage Loan or disposition of the related REO Property have been
recovered.
"Liquidation Proceeds" The amount (other than amounts received
in
respect of the rental of any REO Property prior to REO Disposition)
received by
the Servicer in connection with (i) the taking of all or a part of
a Mortgaged
Property by exercise of the power of eminent domain or condemnation
or (ii) the
liquidation of a defaulted Mortgage Loan by means of a trustee's
sale,
foreclosure sale or otherwise.
"Liquidation Report" The report with respect to a Liquidated
Mortgage Loan in such form as is agreed to by the Servicer, the
Trustee and the
Securities Administrator listing (i) the sale price of the related
Mortgaged
Property or amount of the REO Disposition, (ii) the amount of any
Realized Loss
(or gain) with respect to such Liquidated Mortgage Loan, (iii) the
expenses
relating to the liquidation of such Liquidated Mortgage Loan and
(iv) such other
information as is agreed to by the Servicer, the Trustee and the
Securities
Administrator.
"Loan Group" Either of Loan Group I or Loan Group II.
"Loan Group I" The Group I Mortgage Loans.
"Loan Group II" The Group II Mortgage Loans.
"Loan-to-Value Ratio" For any Mortgage Loan, the ratio, expressed
as
a percentage, the numerator of which is the original loan amount
(unless
otherwise indicated) of a particular Mortgage Loan at origination
and the
denominator of which is the lesser of (x) the appraised value of
the related
Mortgaged Property determined in the appraisal used by the
originator at the
time of origination of such Mortgage Loan, and (y) if the Mortgage
is originated
in connection with a sale of the Mortgaged Property, the sale price
for such
Mortgaged Property.
"Losses" As defined in Section 9.03.
"Lost Note Affidavit" With respect to any Mortgage Loan as to
which
the original Mortgage Note has been permanently lost or destroyed
and has not
been replaced, an affidavit from the Seller certifying that the
original
Mortgage Note has been lost, misplaced or destroyed (together with
a copy of the
related Mortgage Note and indemnifying the Trust against any loss,
cost or
liability resulting from the failure to deliver the original
Mortgage Note) in
the form of Exhibit H hereto.
"Majority Certificateholders" The Holders of Certificates
evidencing
at least 51% of the Voting Interests.
"Majority Class CE Certificateholder" The Holder of Class CE
Certificates evidencing at least a 51% Percentage Interest in the
Class CE
Certificates.
"Marker Rate" With respect to the Class CE Certificates and any
Distribution Date, a per annum rate equal to two (2) times the
weighted average
of the Uncertificated REMIC Pass-Through Rates for REMIC 1 Regular
Interest
LT1AI1A, REMIC 1 Regular Interest LT1AI1B, REMIC 1 Regular Interest
LT1AII1,
REMIC 1 Regular Interest LT1AII2, REMIC 1 Regular Interest LT1AII3,
REMIC 1
Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1
Regular Interest
LT1M3, REMIC 1 Regular Interest LT1M4, REMIC 1 Regular Interest
LT1M5, REMIC 1
Regular Interest LT1M6, REMIC 1 Regular Interest LT1M7, REMIC 1
Regular Interest
LT1M8, REMIC 1 Regular Interest LT1M9, REMIC 1 Regular Interest
LT1M10, REMIC 1
Regular Interest LT1M11, REMIC 1 Regular Interest LT1M12, REMIC 1
Regular
Interest LT1M13 and REMIC 1 Regular Interest LT1ZZ, (i) with the
rate on each
such REMIC Regular Interest (other than REMIC 1 Regular Interest
LT1ZZ) subject
to a cap equal to the Pass-Through Rate of its Corresponding Class
(taking into
account in determining any such Pass-Through Rate the imposition of
the Group I
Cap and the Group II Cap or the Pool Cap, as applicable, as
described in
footnotes (1) through (18) to the table in the Preliminary
Statement relating to
the Certificates) for the purposes of this calculation and (ii)
with the rate on
REMIC 1 Regular Interest LT1ZZ subject to a cap of zero for the
purpose of this
calculation; provided, however, that for this purpose, calculations
of the
Uncertificated REMIC 1 Pass-Through Rate and the related caps with
respect to
each REMIC I Regular Interest shall be multiplied by a fraction,
the numerator
of which is the actual number of days in the Interest Accrual
Period and the
denominator of which is 30.
"Maximum LT1ZZ Uncertificated Accrued Interest Deferral Amount"
With
respect to any Distribution Date, the excess of (a) accrued
interest at the
Uncertificated REMIC 1 Pass-Through Rate applicable to REMIC 1
Regular Interest
LT1ZZ for such Distribution Date on a balance equal to the
Uncertificated
Principal Balance of REMIC 1 Regular Interest LT1ZZ minus the REMIC
1
Overcollateralized Amount, in each case for such Distribution Date,
over (b)
Uncertificated Accrued Interest on REMIC 1 Regular Interest
LT1AI1A, REMIC 1
Regular Interest LT1AI1B, REMIC 1 Regular Interest LT1AII1, REMIC 1
Regular
Interest LT1AII2, REMIC 1 Regular Interest LT1AII3, REMIC 1 Regular
Interest
LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest
LT1M3, REMIC 1
Regular Interest LT1M4, REMIC 1 Regular Interest LT1M5, REMIC 1
Regular Interest
LT1M6, REMIC 1 Regular Interest LT1M7, REMIC 1 Regular Interest
LT1M8, REMIC 1
Regular Interest LT1M9, REMIC 1 Regular Interest LT1M10, REMIC 1
Regular
Interest LT1M11, REMIC 1 Regular Interest LT1M12 and REMIC 1
Regular Interest
LT1M13, each subject to a cap equal to the Pass-Through Rate of the
related
Corresponding Class for the purpose of this calculation; provided,
however, that
for this purpose, calculations of the Uncertificated REMIC 1
Pass-Through Rate
and the related caps with respect to Uncertificated Accrued
Interest on each
REMIC 1 Regular Interest shall be multiplied by a fraction, the
numerator of
which is the actual number of days in the Interest Accrual Period
and the
denominator of which is 30.
"MERS" The Mortgage Electronic Registration Systems, Inc.
"MERS Mortgage Loan" Any MOM Mortgage Loan or any other
Mortgage
Loan as to which MERS is (or is intended to be) the mortgagee of
record and as
to which a MIN has been assigned.
"MIN" A MERS Mortgage Identification Number assigned to a
Mortgage
Loan in accordance with the MERS Procedure Manual.
"Minimum Mortgage Interest Rate" With respect to each
Adjustable
Rate Mortgage Loan, the percentage set forth in the related
Mortgage Note as the
minimum Mortgage Interest Rate thereunder.
"MOM" A Mortgage Loan where the related Mortgage names MERS as
the
original mortgagee thereof, as to which a MIN has been assigned,
and which
Mortgage has not been assigned to any other person.
"Monthly Excess Cashflow Amount" The sum of (a) the Monthly
Excess
Interest Amount remaining after reduction (but not below zero) by
any Current
Interest Shortfall and any amounts used to fund any Extra Principal
Distribution
Amount, (b) the Overcollateralization Release Amount and (c) any
portion of the
Principal Distribution Amount (without duplication) remaining after
principal
distributions on the Certificates (other than the Class CE, Class P
and Residual
Certificates).
"Monthly Excess Interest Amount" With respect to each
Distribution
Date, the amount, if any, by which the Interest Remittance Amount
for such
Distribution Date exceeds the aggregate amount distributed on such
Distribution
Date pursuant to paragraphs (i) through (xviii) of Section
4.01.
"Monthly Payment" With respect to any Mortgage Loan, the
scheduled
monthly payment of principal and interest on such Mortgage Loan
which is payable
by the related Mortgagor from time to time under the related
Mortgage Note,
determined: (a) after giving effect to (i) any Deficient Valuation
and/or Debt
Service Reduction with respect to such Mortgage Loan and (ii) any
reduction in
the amount of interest collectible from the related Mortgagor
pursuant to the
Relief Act or similar state laws; (b) without giving effect to any
extension
granted or agreed to by the Servicer pursuant to Section 3.01; and
(c) on the
assumption that all other amounts, if any, due under such Mortgage
Loan are paid
when due.
"Mortgage" The mortgage, deed of trust or other instrument
creating
a first or second lien on, or first or second priority security
interest in, a
Mortgaged Property securing a Mortgage Note.
"Mortgage File" Either of the Owner Mortgage File or Retained
Mortgage File.
"Mortgage Interest Rate" With respect to each Mortgage Loan,
the
annual rate at which interest accrues on such Mortgage Loan from
time to time in
accordance with the provisions of the related Mortgage Note, which
rate (i) in
the case of each Fixed Rate Mortgage Loan shall remain constant at
the rate set
forth in the applicable Mortgage Loan Schedule as the Mortgage
Interest Rate in
effect immediately following the applicable Cut-off Date and (ii)
in the case of
each Adjustable Rate Mortgage Loan (A) as of any date of
determination until the
first Adjustment Date following the applicable Cut-off Date shall
be the rate
set forth in the applicable Mortgage Loan Schedule as the Mortgage
Interest Rate
in effect immediately following the applicable Cut-off Date and (B)
as of any
date of determination thereafter shall be the rate as adjusted on
the most
recent Adjustment Date, to equal the sum, rounded as provided in
the Mortgage
Note, of the Index, determined as set forth in the related Mortgage
Note, plus
the related Gross Margin subject to the limitations set forth in
the related
Mortgage Note. With respect to each Mortgage Loan that becomes an
REO Property,
as of any date of determination, the annual rate determined in
accordance with
the immediately preceding sentence as of the date such Mortgage
Loan became an
REO Property.
"Mortgage Loan" Each mortgage loan transferred and assigned to
the
Trustee pursuant to Section 2.01 or Section 2.03(d) as from time to
time held as
a part of the Trust Fund, the Mortgage Loans so held being
identified in the
Mortgage Loan Schedules.
"Mortgage Loan Purchase Agreement" The agreement between the
Seller
and the Depositor, dated as of [ ], 200 , regarding the transfer of
the Mortgage
Loans by the Seller to or at the direction of the Depositor, in the
form of
Exhibit G attached hereto.
"Mortgage Loan Schedule" As of any date with respect to the
Mortgage
Loans, the lists of such Mortgage Loans included in the Trust Fund
on such date,
separately identifying the Fixed Rate Mortgage Loans and the
Adjustable Rate
Mortgage Loans delivered by the Depositor to the Trustee, the
Servicer, the
Securities Administrator and the Custodian. The Mortgage Loan
Schedules shall
set forth the following information with respect to each Mortgage
Loan:
(1) the Mortgage Loan identifying number;
(2) the city, state and zip code of the Mortgaged Property;
(3) the type of property;
(4) the Mortgage Interest Rate;
(5) the Net Mortgage Interest Rate;
(6) the Monthly Payment;
(7) the original number of months to maturity;
(8) the scheduled maturity date;
(9) the Cut-off Date Principal Balance;
(10) the Loan-to-Value
Ratio at origination;
(11) whether such Mortgage Loan is covered by primary mortgage
insurance;
(12) the applicable Servicing Fee Rate;
(13) the Index;
(14) the Gross Margin;
(15) the Periodic Cap;
(16) the first Adjustment Date;
(17) the Rate Ceiling; and
(18) a code indicating whether the Mortgage Loan has a
Prepayment
Penalty and the Prepayment Penalty term.
The Mortgage Loan Schedules shall set forth the following
information, as of the applicable Cut-off Date, with respect to the
Mortgage
Loans in the aggregate, for Loan Group I and Loan Group II: (1) the
number of
Mortgage Loans; (2) the current unpaid principal balance of the
Mortgage Loans;
(3) the weighted average Mortgage Interest Rate of the Mortgage
Loans; and (4)
the weighted average maturity of the Mortgage Loans. The Mortgage
Loan Schedules
shall be amended from time to time in accordance with the
provisions of this
Agreement. With respect to any Eligible Substitute Mortgage Loan,
Cut-off Date
shall refer to the applicable date of substitution.
"Mortgage Note" The original executed note or other evidence of
indebtedness evidencing the indebtedness of a Mortgagor under a
Mortgage Loan.
"Mortgage Pool" The pool of Mortgage Loans, identified on the
Mortgage Loan Schedule from time to time, and any REO Properties
acquired in
respect thereof.
"Mortgaged Property" The underlying property securing a
Mortgage
Loan, including any REO Property, consisting of an Estate in Real
Property
improved by a Residential Dwelling.
"Mortgagor" The obligor on a Mortgage Note.
"Net Liquidation Proceeds" With respect to any Liquidated
Mortgage
Loan or any other disposition of related Mortgaged Property
(including REO
Property) the related Liquidation Proceeds net of unreimbursed
Advances,
unreimbursed Servicing Advances, unpaid Servicing Fees and any
other accrued and
unpaid servicing fees received and retained in connection with the
liquidation
of such Mortgage Loan or Mortgaged Property.
"Net Mortgage Interest Rate" With respect to any Mortgage Loan,
the
Mortgage Interest Rate borne by such Mortgage Loan minus the
Expense Fee Rate.
"Net Rate Ceiling" With respect to any Adjustable Rate Mortgage
Loan, the applicable Rate Ceiling minus the Expense Fee Rate.
"Nonrecoverable Advance" Any Advance or Servicing Advance
previously
made or proposed to be made in respect of a Mortgage Loan that, in
the good
faith business judgment of the Servicer (or the Trustee, in the
case of any
Advance made by the Trustee pursuant to Section 7.01), will not or,
in the case
of a proposed Advance or Servicing Advance, would not be ultimately
recoverable
from Late Collections on such Mortgage Loan as provided herein.
"Notional Amount" With respect to the Class CE Uncertificated
Interest and the Class CE Certificates, an amount equal to the
aggregate
principal balance of the REMIC 1 Regular Interests.
"NYCEMA" A New York Consolidation, Extension and Modification
Agreement.
"Officers' Certificate" A certificate signed by the Chairman of
the
Board, the Vice Chairman of the Board, the President, a vice
president (however
denominated), and by the Treasurer, the Secretary, or one of the
assistant
treasurers or assistant secretaries of the Servicer, the
Securities
Administrator, the Trustee or the Depositor, as applicable.
"One-Month LIBOR" With respect to each Interest Accrual Period,
the
rate determined by the Securities Administrator on the related
LIBOR
Determination Date on the basis of the British Bankers' Association
("BBA")
"Interest Settlement Rate" for one-month deposits in U.S. Dollars
as found on
Telerate Page 3750 as of 11:00 A.M. London time on such LIBOR
Determination
Date. If no such quotations are available on a LIBOR Determination
Date,
One-Month LIBOR for the related Interest Accrual Period will be
established by
the Securities Administrator as the higher of:
(i) One-Month LIBOR as determined on the previous LIBOR
Determination Date; and
(ii) the rate per annum which the Securities Administrator
determines
to be either (A) the arithmetic mean (rounding such arithmetic
mean
upwards if necessary to the nearest whole multiple of 1/16%) of
the
one-month
U.S. Dollar lending rates that New York City banks selected by
the
Securities Administrator are quoting, on the relevant LIBOR
Determination Date, to the principal London offices of at least
two
leading
banks in the London interbank market or (B) in the event that
the
Securities
Administrator can determine no such arithmetic mean, the lowest
one-month
U.S. Dollar lending rate that the New York City banks selected
by the
Securities Administrator are quoting on such LIBOR
Determination
Date to
leading European banks.
"Opinion of Counsel" A written opinion of counsel, who may,
without
limitation, be a salaried counsel for the Depositor, the
Securities
Administrator, the Trustee or the Servicer except that any opinion
of counsel
relating to (a) the qualification of any REMIC as a REMIC or (b)
compliance with
the REMIC Provisions must be an opinion of Independent counsel.
"Optional Termination Date" The first Distribution Date on which
the
Majority Class CE Certificateholder or, if there is no Majority
Class CE
Certificateholder, the Depositor, may opt to terminate the Mortgage
Pool
pursuant to Section 10.01.
"Original Principal Balance" With respect to each Class of
Certificates, the Principal Balance thereof on the Closing Date, as
set forth
opposite such Class in the Preliminary Statement, except with
respect to (i) the
Class P and Residual Certificates, which have an Original Principal
Balance of
zero and (ii) the Class CE Certificates, which, solely for REMIC
purposes, have
an Original Principal Balance equal to the Initial
Overcollateralization Amount.
"Originator" Wells Fargo Bank and its successors.
"Originator Prepayment Penalty Payment Amount" The amount payable
by
the Originator pursuant to Section 5(b) of the Mortgage Loan
Purchase Agreement.
"Overcollateralization Amount" As of any Distribution Date, the
excess, if any, of (x) the Pool Balance as of the last day of the
related
Collection Period over (y) the aggregate Principal Balance of all
Classes of
Certificates (other than the Class CE, Class P and Residual
Certificates) after
taking into account all distributions of principal on such
Distribution Date and
the increase of any Principal Balance as a result of Subsequent
Recoveries.
"Overcollateralization Deficiency" As of any Distribution Date,
the
excess, if any, of (x) the Targeted Overcollateralization Amount
for such
Distribution Date over (y) the Overcollateralization Amount for
such
Distribution Date, calculated for this purpose after taking into
account the
reduction on such Distribution Date of the Principal Balances of
all Classes of
Certificates (other than the Class CE, Class P and Residual
Certificates)
resulting from the distribution of the Principal Distribution
Amount (but not
the Extra Principal Distribution Amount) on such Distribution Date,
but prior to
taking into account any Applied Realized Loss Amount on such
Distribution Date.
"Overcollateralization Floor" As of any Distribution Date, the
amount by which the Pool Balance as of the last day of the related
Collection
Period exceeds the product of (i) [ ]% and (ii) the Pool Balance as
of the
Cut-off Date.
"Overcollateralization Release Amount" With respect to any
Distribution Date on or after the Stepdown Date on which a Trigger
Event is not
in effect, the lesser of (x) the Principal Remittance Amount and
(y) the excess,
if any, of (i) the Overcollateralization Amount for such
Distribution Date,
assuming that 100% of the Principal Remittance Amount is applied as
a principal
payment on the Certificates (other than the Class CE, Class P and
Residual
Certificates) on such Distribution Date, over (ii) the Targeted
Overcollateralization Amount for such Distribution Date. With
respect to any
Distribution Date on which a Trigger Event is in effect, the
Overcollateralization Release Amount will be zero.
"Owner Mortgage File" A file maintained by the Custodian for
each
Mortgage Loan that contains the documents specified in Section
2.01(a) and any
additional documents required to be added to the Owner Mortgage
File pursuant to
this Agreement.
"Ownership Interest" As to any Certificate, any ownership or
security interest in such Certificate, including any interest in
such
Certificate as the Holder thereof and any other interest therein,
whether direct
or indirect, legal or beneficial, as owner or as pledgee.
"Pass-Through Rate" With respect to any REMIC Regular Interest
(other than the Class CE Uncertificated Interest and the Class CE
Certificates),
the Pass-Through Rate described for such Class in the table in the
Preliminary
Statement. With respect to the Class CE Certificates and any
Distribution Date,
a per annum rate equal to the percentage equivalent of a fraction,
the numerator
of which is the sum of the amounts calculated pursuant to clauses
(A) through
(T) below, and the denominator of which is the aggregate of the
Uncertificated
Principal Balances of REMIC 1 Regular Interest LT1AI1A, REMIC 1
Regular Interest
LT1AI1B, REMIC 1 Regular Interest LT1AII1, REMIC 1 Regular Interest
LT1AII2,
REMIC 1 Regular Interest LT1AII3, REMIC 1 Regular Interest LT1M1,
REMIC 1
Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1
Regular Interest
LT1M4, REMIC 1 Regular Interest LT1M5, REMIC 1 Regular Interest
LT1M6, REMIC 1
Regular Interest LT1M7, REMIC 1 Regular Interest LT1M8, REMIC 1
Regular Interest
LT1M9, REMIC 1 Regular Interest LT1M10, REMIC 1 Regular Interest
LT1M11, REMIC 1
Regular Interest LT1M12, REMIC 1 Regular Interest LT1M13 and REMIC
1 Regular
Interest LT1ZZ. For purposes of calculating the Pass-Through Rate
for the Class
CE Uncertificated Interest and the Class CE Certificates, the
numerator is equal
to the sum of the following components:
(A) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1AA minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1AA;
(B) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1AI1A minus the Marker Rate, applied to an amount equal
to the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1AI1A;
(C) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1AI1B minus the Marker Rate, applied to an amount equal
to the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1AI1B;
(D) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1AII1 minus the Marker Rate, applied to an amount equal
to the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1AII1;
(E) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1AII2 minus the Marker Rate, applied to an amount equal
to the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1AII2;
(F) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1AII3 minus the Marker Rate, applied to an amount equal
to the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1AII3;
(G) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M1 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1M1;
(H) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M2 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1M2;
(I) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M3 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1M3;
(J) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M4 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1M4;
(K) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M5 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1M5;
(L) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M6 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1M6;
(M) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M7 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1M7;
(N) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M8 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1M8;
(O) the
Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M9 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1M9;
(P) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M9 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1M10;
(Q) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M9 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1M11;
(R) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M9 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1M12;
(S) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M13 minus the Marker Rate, applied to an amount equal
to the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1M13; and
(T) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1ZZ minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1ZZ.
"Paying Agent" Any paying agent appointed pursuant to Section
5.05.
"Paying Agent Agreement" As defined in Section 5.05.
"Percentage Interest" With respect to any Certificate (other than
a
Class CE, Class P and Residual Certificate), a fraction, expressed
as a
percentage, the numerator of which is the initial Principal
Balance, as the case
may be, represented by such Certificate and the denominator of
which is the
Original Principal Balance of the related Class. With respect to a
Class CE or
Class P Certificate, the portion of the Class evidenced thereby,
expressed as a
percentage, as stated on the face of such Certificate; provided,
however, that
the sum of all such percentages for each such Class totals 100%.
With respect to
each of the Class R and Class R-X Certificates, 100%.
"Periodic Cap" With respect to each Adjustable Rate Mortgage
Loan,
the applicable limit on adjustment of the Mortgage Interest Rate
for each
Adjustment Date specified in the applicable Mortgage Note and
designated as such
in the Mortgage Loan Schedules.
"Permitted Transferee" Any transferee of a Residual Certificate
other than a Disqualified Organization, a non-U.S. Person or a U.S.
Person with
respect to whom income on the Residual Certificate is attributable
to a foreign
permanent establishment or fixed base, within the meaning of an
applicable
income tax treaty, of such Person or any other U.S. Person.
"Person" Any individual, corporation, partnership, joint
venture,
association, joint stock company, trust, limited liability
company,
unincorporated organization or government or any agency or
political subdivision
thereof.
"Pool Balance" As of any date of determination, the aggregate
unpaid
principal balance of the Mortgage Loans.
"Pool Cap" As of any Distribution Date and for the Class M
Certificates, a per annum rate, equal to the weighted average of
the Group I Cap
and the Group II Cap, weighted on the basis of the related Group
Subordinate
Amount. For federal income tax purposes, the economic equivalent of
such rate
shall be expressed as the weighted average of the REMIC 1
Remittance Rate on (a)
REMIC 1 Regular Interest LT1SUB, subject to a cap and floor equal
to the
Weighted Average Net Mortgage Interest Rates of the Group I
Mortgage Loans and
(b) REMIC 1 Regular Interest LT2SUB, subject to a cap and floor
equal to the
Weighted Average Net Mortgage Interest Rates of the Group II
Mortgage Loans,
weighted on the basis of the Uncertificated Balance of such REMIC 1
Regular
Interests.
"Pool Maximum Rate Cap" With respect to any Distribution Date
and
for the Class M Certificates, a per annum rate, equal to the
weighted average of
(i) Group I Maximum Rate Cap and (ii) the Group II Maximum Rate
Cap, weighted on
the basis of the related Group Subordinate Amount.
"Prepayment Interest Shortfall" With respect to any
Distribution
Date, for each Mortgage Loan that was the subject of a Principal
Prepayment
during the related Prepayment Period that was applied by the
Servicer to reduce
the outstanding Principal Balance of such Mortgage Loan on a date
preceding the
related Due Date, an amount equal to interest at the applicable
Mortgage
Interest Rate (net of the Servicing Fee Rate) on the amount of such
Principal
Prepayment for the number of days commencing on the date on which
the Principal
Prepayment is applied and ending on the last day of the calendar
month in which
applied.
"Prepayment Penalty" With respect to any Prepayment Period, any
Prepayment Penalty, penalty or charge collected by the Servicer
from a Mortgagor
in connection with any voluntary Principal Prepayment in full
pursuant to the
terms of the related Mortgage Note as from time to time held as a
part of the
Trust Fund, the Prepayment Penalties so held being determined in
accordance with
the guidelines for Prepayment Penalty provisions set forth in the
Seller
underwriting standards. The defined term "Prepayment Penalty" shall
not include
any Servicer Prepayment Penalty Payment Amount or Originator
Prepayment Penalty
Payment Amount.
"Prepayment Period" With respect to any Distribution Date, the
one
month period ending on the last day of the calendar month preceding
the month in
which such Distribution Date occurs.
"Principal Balance" With respect to any Class of Certificates
(other
than the Class CE, Class P and Residual Certificates) and any
Distribution Date,
the Original Principal Balance (a) reduced by the sum of (i) all
amounts
actually distributed in respect of principal of such Class on all
prior
Distribution Dates and (ii) Applied Realized Loss Amounts allocated
thereto for
previous Distribution Dates and (b) increased by any Subsequent
Recoveries
allocated to such Class for previous Distribution Dates. The Class
CE, Class P
and Residual Certificates do not have a Principal Balance. With
respect to any
Certificate (other than a Class CE, Class P or Residual
Certificate) of a Class
and any Distribution Date, the portion of the Principal Balance of
such Class
represented by such Certificate equal to the product of the
Percentage Interest
evidenced by such Certificate and the Principal Balance of such
Class.
"Principal Distribution Amount" With respect to any
Distribution
Date, (a) the sum of (i) the Principal Remittance Amount and (ii)
the Extra
Principal Distribution Amount, if any, minus (b) the
Overcollateralization
Release Amount.
"Principal Prepayment" Any payment of principal made by the
Mortgagor on a Mortgage Loan which is received in advance of its
scheduled Due
Date and which is not accompanied by an amount of interest
representing the full
amount of scheduled interest due on any Due Date in any month or
months
subsequent to the month of prepayment.
"Principal Remittance Amount" With respect to any Distribution
Date,
to the extent of funds available therefor, the sum (less amounts
available for
reimbursement of Advances and Servicing Advances pursuant to
Section 3.05 and
expenses reimbursable pursuant to Section 6.03 and amounts
reimbursable or
payable to the Securities Administrator or Trustee pursuant to this
Agreement,
including, without limitation, Sections 8.05 and Section 9.01(c))
of: (i) each
payment of principal on a Mortgage Loan due during the related
Collection Period
and received by the Servicer on or prior to the related
Determination Date, and
any Advances with respect thereto (other than any payment received
on an
Eligible Substitute Mortgage Loan substituted during the related
Collection
Period), (ii) all full and partial Principal Prepayments received
by the
Servicer during the related Prepayment Period, (iii) Subsequent
Recoveries,
Insurance Proceeds and Net Liquidation Proceeds allocable to
principal actually
collected by the Servicer during the related Prepayment Period,
(iv) with
respect to Defective Mortgage Loans repurchased with respect to
such Prepayment
Period, the portion of the Purchase Price allocable to principal,
(v) any
Substitution Adjustment Amounts received during the related
Prepayment Period
and (vi) on the Distribution Date on which the Trust is to be
terminated in
accordance with Section 10.01 hereof, that portion of the
Termination Price in
respect of principal.
"Private Certificates" Any of the Class M-12, Class M-13, Class
CE,
Class P, Class R and Class R-X Certificates.
"Private Placement Memorandum" That certain private placement
memorandum dated [ ], 20 relating to the private placement of the
Class M-12,
Class M-13, Class CE and Class P Certificates.
"Prospectus" That certain Prospectus, dated [____], 20[_], as
supplemented by the Prospectus Supplement dated [____], 20[_]
relating to the
public offering of the Senior Certificates and the Class M
Certificates (other
than the Class M-12 and Class M-13 Certificates).
"Purchase Price" With respect to any Mortgage Loan or REO
Property
to be purchased pursuant to or as contemplated by Section 2.01,
2.03, 3.16 or
10.01, an amount equal to the sum of (i) 100% of the unpaid
principal balance
thereof as of the date of purchase (or such other price as provided
in Section
10.01), (ii) in the case of a Mortgage Loan, accrued interest on
such unpaid
principal balance at the applicable Mortgage Interest Rate in
effect from time
to time from the Due Date as to which interest was last covered by
a payment by
the Mortgagor or an Advance by the Servicer, which payment or
Advance had as of
the date of purchase been distributed pursuant to Section 4.01,
through the end
of the calendar month in which the purchase is to be effected,
(iii) any
unreimbursed Servicing Advances and Advances and any unpaid
Servicing Fees
allocable to such Mortgage Loan or REO Property, (iv) any amounts
previously
withdrawn from the Collection Account in respect of such Mortgage
Loan or REO
Property pursuant to Section 3.13 and (v) in the case of a Mortgage
Loan
required to be purchased pursuant to Section 2.03, expenses
reasonably incurred
or to be incurred by the Servicer, the Securities Administrator or
the Trustee
in respect of the breach or defect giving rise to the purchase
obligation.
"Rate Ceiling" With respect to each Adjustable Rate Mortgage
Loan,
the maximum per annum Mortgage Interest Rate permitted under the
related
Mortgage Note.
"Rating Agency or Rating Agencies" [ ] and [ ], or their
respective
successors. If such agencies or their successors are no longer in
existence,
"Rating Agencies" shall be such nationally recognized statistical
rating
organizations as set forth on the most current list of such
organizations
released by the Commission and designated by the Depositor, notice
of which
designation shall be given to the Trustee, the Securities
Administrator and the
Servicer.
"Realized Loss" With respect to a Liquidated Mortgage Loan, the
amount by which the remaining unpaid principal balance of the
Mortgage Loan
exceeds the amount of Net Liquidation Proceeds applied to the
principal balance
of the related Mortgage Loan. With respect to any Mortgage Loan, a
Deficient
Valuation or a reduction in the Principal Balance thereof resulting
from a
Servicer Modification.
"Realized Loss Amortization Amount" Any of the Class M-1
Realized
Loss Amortization Amount, the Class M-2 Realized Loss Amortization
Amount, the
Class M-3 Realized Loss Amortization Amount, the Class M-4 Realized
Loss
Amortization Amount, the Class M-5 Realized Loss Amortization
Amount, the Class
M-6 Realized Loss Amortization Amount, the Class M-7 Realized Loss
Amortization
Amount, the Class M-8 Realized Loss Amortization Amount, the Class
M-9 Realized
Loss Amortization Amount, the Class M-10 Realized Loss Amortization
Amount, the
Class M-11 Realized Loss Amortization Amount, the Class M-12
Realized Loss
Amortization Amount and the Class M-13 Realized Loss Amortization
Amount.
"Record Date" With respect to any Distribution Date and (i) the
Class CE, Class P and Residual Certificates, the last Business Day
of the
preceding month and (ii) any Class of Book-Entry Certificates, the
Business Day
immediately preceding such Distribution Date; provided, however,
that if any
Book-Entry Certificate becomes a Definitive Certificate, the Record
Date for
such Class shall be the last Business Day of the immediately
preceding month.
"Reference Banks" Initially, the Reference Banks shall be
Deutsche
Bank International, Bank of America, N.A., Citibank, N.A., and The
Fuji Bank,
Limited. If any of these banks are not available, the Securities
Administrator
shall select from one of the following banks a substitute Reference
Bank: Credit
Suisse First Boston Corporation, Westdeutsche Landesbank
Girozentrale, The J.P.
Morgan Chase Bank or National Westminster Bank Plc. If any of these
banks are
not available, the Securities Administrator shall in its discretion
select
another Reference Bank.
"Regular Certificate" Any of the Class A, Class M and Class CE
Certificates.
"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
publicly 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.
"Reimbursement Amount" With respect to any Mortgage Loan, any
costs
or damages incurred by the Trust in connection with a breach of the
Depositor's
representations set forth in Section 2.04(i) hereof.
"Related Documents" With respect to any Mortgage Loan, the
related
Mortgage Notes, Mortgages and other related documents.
"Relevant Servicing Criteria" The Servicing Criteria applicable
to
the Securities Administrator, the Trustee, the Custodian or the
Servicer, as set
forth on Exhibit S attached hereto. For clarification purposes,
multiple parties
can have responsibility for the same Relevant Servicing Criteria.
With respect
to a Servicing Function Participant engaged by the Securities
Administrator, the
Trustee, the Custodian or the Servicer, the term "Relevant
Servicing Criteria"
refers to the portion of the Relevant Servicing Criteria applicable
to the party
engaging such Servicing Function Participant insofar as the
functions required
to be performed by such party are to be performed by the Servicing
Function
Participant.
"Relief Act" The Servicemembers Civil Relief Act, as it may be
amended from time to time.
"Relief Act Interest Shortfall" With respect to any
Distribution
Date, for any Mortgage Loan with respect to which there has been a
reduction in
the amount of interest collectible thereon for the most recently
ended
Collection Period as a result of the application of the Relief Act
or similar
state laws, the amount by which (i) interest collectible on such
Mortgage Loan
during such Collection Period is less than (ii) one month's
interest on the
principal balance of such Mortgage Loan at the Mortgage Interest
Rate for such
Mortgage Loan before giving effect to the application of the Relief
Act or
similar state laws.
"REMIC" A "real estate mortgage investment conduit" within the
meaning of Section 860D of the Code.
"REMIC 1 Interest Loss Allocation Amount" With respect to any
Distribution Date, an amount equal to (a) the product of (i) 50% of
the sum of
the aggregate principal balance of the Mortgage Loans and related
REO Properties
then outstanding and (ii) the Uncertificated REMIC 1 Pass-Through
Rate for REMIC
1 Regular Interest LT1AA minus the Marker Rate, divided by (b)
12.
"REMIC 1 Marker Allocation Percentage" 50% of any amount
payable
from or loss attributable to the Mortgage Loans, which shall be
allocated to
REMIC 1 Regular Interest LT1AA, REMIC 1 Regular Interest LT1AI1A,
REMIC 1
Regular Interest LT1AI1B, REMIC 1 Regular Interest LT1AII1, REMIC 1
Regular
Interest LT1AII2, REMIC 1 Regular Interest LT1AII3, REMIC 1 Regular
Interest
LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest
LT1M3, REMIC 1
Regular Interest LT1M4, REMIC 1 Regular Interest LT1M5, REMIC 1
Regular Interest
LT1M6, REMIC 1 Regular Interest LT1M7, REMIC 1 Regular Interest
LT1M8, REMIC 1
Regular Interest LT1M9, REMIC 1 Regular Interest LT1M10, REMIC 1
Regular
Interest LT1M11, REMIC 1 Regular Interest LT1M12, REMIC 1 Regular
Interest
LT1M13 and REMIC 1 Regular Interest LT1ZZ.
"REMIC 1 Overcollateralization Target Amount" 0.50% of the
Targeted
Overcollateralization Amount.
"REMIC 1 Overcollateralized Amount" With respect to any date of
determination, (i) 0.50% of the aggregate Uncertificated Principal
Balances of
the REMIC 1 Regular Interests minus (ii) the aggregate of the
Uncertificated
Principal Balances of REMIC 1 Regular Interest LT1AI1A, REMIC 1
Regular Interest
LT1AI1B, REMIC 1 Regular Interest LT1AII1, REMIC 1 Regular Interest
LT1AII2,
REMIC 1 Regular Interest LT1AII3, REMIC 1 Regular Interest LT1M1,
REMIC 1
Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1
Regular Interest
LT1M4, REMIC 1 Regular Interest LT1M5, REMIC 1 Regular Interest
LT1M6, REMIC 1
Regular Interest LT1M7, REMIC 1 Regular Interest LT1M8, REMIC 1
Regular Interest
LT1M9, REMIC 1 Regular Interest LT1M10, REMIC 1 Regular Interest
LT1M11, REMIC 1
Regular Interest LT1M12 and REMIC 1 Regular Interest LT1M13, in
each case as of
such date of determination.
"REMIC 1
Principal Loss Allocation Amount" With respect to any
Distribution Date, an amount equal to (a) the product of (i) 50% of
the
aggregate Principal Balance of the Mortgage Loans and related REO
Properties
then outstanding and (ii) 1 minus a fraction, the numerator of
which is two
times the aggregate of the Uncertificated Principal Balances of
REMIC 1 Regular
Interest LT1AI1A, REMIC 1 Regular Interest LT1AI1B, REMIC 1 Regular
Interest
LT1AII1, REMIC 1 Regular Interest LT1AII2, REMIC 1 Regular Interest
LT1AII3,
REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2,
REMIC 1 Regular
Interest LT1M3, REMIC 1 Regular Interest LT1M4, REMIC 1 Regular
Interest LT1M5,
REMIC 1 Regular Interest LT1M6, REMIC 1 Regular Interest LT1M7,
REMIC 1 Regular
Interest LT1M8, REMIC 1 Regular Interest LT1M9, REMIC 1 Regular
Interest LT1M10,
REMIC 1 Regular Interest LT1M11, REMIC 1 Regular Interest LT1M12
and REMIC 1
Regular Interest LT1M13, the denominator of which is aggregate of
the
Uncertificated Principal Balances of REMIC 1 Regular Interest
LT1AI1A, REMIC 1
Regular Interest LT1AI1B, REMIC 1 Regular Interest LT1AII1, REMIC 1
Regular
Interest LT1AII2, REMIC 1 Regular Interest LT1AII3, REMIC 1 Regular
Interest
LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest
LT1M3, REMIC 1
Regular Interest LT1M4, REMIC 1 Regular Interest LT1M5, REMIC 1
Regular Interest
LT1M6, REMIC 1 Regular Interest LT1M7, REMIC 1 Regular Interest
LT1M8, REMIC 1
Regular Interest LT1M9, REMIC 1 Regular Interest LT1M10, REMIC 1
Regular
Interest LT1M11, REMIC 1 Regular Interest LT1M12, REMIC 1 Regular
Interest
LT1M13 and REMIC 1 Regular Interest LT1ZZ.
"REMIC 1 Regular Interest LT1AA" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1AA
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1AI1A" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1AI1A
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1AI1B" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1AI1B
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1AII1" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1AII1
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1AII2" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1AII2
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1AII3" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1AII3
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M1" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1M1
shall accrue interest at the related Uncertificated REMIC 1 Pass-
Through Rate
in effect from time to time, and shall be entitled to distributions
of
principal, subject to the terms and conditions hereof, in an
aggregate amount
equal to its initial Uncertificated Principal Balance as set forth
in the
Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1M2" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1M2
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M3" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1M3
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M4" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1M4
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M5" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1M5
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M6" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1M6
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M7" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1M7
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M8" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1M8
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M9" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1M9
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M10" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1M10
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M11" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1M11
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M12" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1M12
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M13" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1M13
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1SUB" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1SUB
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1XX" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1XX
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1ZZ" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT1ZZ
shall accrue interest at the related Uncertificated REMIC 1 Pass-
Through Rate
in effect from time to time, and shall be entitled to distributions
of
principal, subject to the terms and conditions hereof, in an
aggregate amount
equal to its initial Uncertificated Principal Balance as set forth
in the
Preliminary Statement hereto.
"REMIC 1 Regular Interest LT2GRP" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT2GRP
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT2SUB" One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular
Interest LT2SUB
shall accrue interest at the related Uncertificated REMIC 1
Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of
principal,
subject to the terms and conditions hereof, in an aggregate amount
equal to its
initial Uncertificated Principal Balance as set forth in the
Preliminary
Statement hereto.
"REMIC 1 Regular Interests" REMIC 1 Regular Interest LT1AA, REMIC
1
Regular Interest LT1AI1A, REMIC 1 Regular Interest LT1AI1B, REMIC 1
Regular
Interest LT1AII1, REMIC 1 Regular Interest LT1AII2, REMIC 1 Regular
Interest
LT1AII3, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest
LT1M2, REMIC 1
Regular Interest LT1M3, REMIC 1 Regular Interest LT1M4, REMIC 1
Regular Interest
LT1M5, REMIC 1 Regular Interest LT1M6, REMIC 1 Regular Interest
LT1M7, REMIC 1
Regular Interest LT1M8, REMIC 1 Regular Interest LT1M9, REMIC 1
Regular Interest
LT1M10, REMIC 1 Regular Interest LT1M11, REMIC 1 Regular Interest
LT1M12, REMIC
1 Regular Interest LT1M13, REMIC 1 Regular Interest LT1SUB, REMIC 1
Regular
Interest LT1GRP, REMIC 1 Regular Interest LT2SUB, REMIC 1 Regular
Interest
LT2GRP, REMIC 1 Regular Interest LT1XX and REMIC 1 Regular Interest
LT1ZZ.
"REMIC 1 Sub WAC Allocation Percentage" 50% of any amount payable
or
loss attributable from the Mortgage Loans, which shall be allocated
to REMIC 1
Regular Interest LT1SUB, REMIC 1 Regular Interest LT1GRP, REMIC 1
Regular
Interest LT2SUB, REMIC 1 Regular Interest LT2GRP and REMIC 1
Regular Interest
LT1XX.
"REMIC 1 Subordinated Balance Ratio" As of any Distribution
Date,
the ratio among the Uncertificated Principal Balances of each REMIC
1 Regular
Interest ending with the designation "SUB," equal to the ratio
among, with
respect to each such REMIC 1 Regular Interest, the excess of (x)
the aggregate
unpaid principal balance of the Mortgage Loans in the related Loan
Group over
(y) the Principal Balance of the Senior Certificates relating to
such Loan
Group.
"REMIC Provisions" Provisions of the federal income tax law
relating
to real estate mortgage investment conduits which appear at Section
860A through
860G of Subchapter M of Chapter 1 of the Code, and related
provisions, and
regulations and rulings promulgated thereunder, as the foregoing
may be in
effect from time to time.
"REMIC Regular Interest" Any REMIC 1 Regular Interest, the Class
CE
Uncertificated Interest or any of the Certificates (other than the
Class P and
Residual Certificates).
"Remittance Report" A report prepared by the Servicer and
delivered
to the Securities Administrator pursuant to Section 4.07,
containing the
information attached hereto as Exhibit M.
"Rents from Real Property" With respect to any REO Property,
gross
income of the character described in Section 856(d) of the
Code.
"REO Disposition" The sale or other disposition of an REO
Property
on behalf of the Trust.
"REO Disposition Fee" The REO Disposition Fee shall be the
greater
of one percent (1%) of the gross sales price of the REO Property or
$1,500.00 up
to a maximum fee of $10,000 per REO Property.
"REO Imputed Interest" As to any REO Property, for any
Collection
Period, an amount equivalent to interest (at the Net Mortgage
Interest Rate that
would have been applicable to the related Mortgage Loan had it been
outstanding)
for such Collection Period on the unpaid principal balance of the
Mortgage Loan
as of the date of acquisition.
"REO Mortgage Loan" Any Mortgage Loan which is not a Liquidated
Mortgage Loan and as to which the indebtedness evidenced by the
related Mortgage
Note is discharged and the related Mortgaged Property is held as
part of the
Trust Fund.
"REO Principal Amortization" With respect to any REO Property,
for
any calendar month, the aggregate of all amounts received in
respect of such REO
Property during such calendar month, whether in the form of rental
income, sale
proceeds (including, without limitation, that portion of the
Termination Price
paid in connection with a purchase of all of the Mortgage Loans and
REO
Properties pursuant to Section 10.01 that is allocable to such REO
Property) or
otherwise, net of any portion of such amounts (i) payable pursuant
to Section
3.13 in respect of the proper operation, management and maintenance
of such REO
Property or (ii) payable or reimbursable to the Servicer pursuant
to Section
3.13 for unpaid Servicing Fees in respect of the related Mortgage
Loan and
payable and reimbursable to the Servicer or the Trustee for
unreimbursed
Servicing Advances and Advances in respect of such REO Property or
the related
Mortgage Loan.
"REO Property" A Mortgaged Property acquired by the Servicer on
behalf of the Trust through foreclosure or deed-in-lieu of
foreclosure, as
described in Section 3.13.
"Reportable Event" As defined in Section 3.28(c).
"Request for Release" A release signed by a Servicing Officer,
in
the form of Exhibit E attached hereto.
"Reserve Account" The trust account created and maintained by
the
Securities Administrator pursuant to Section 3.04(g) which shall be
entitled
"Reserve Account, Wells Fargo Bank, N.A., as Securities
Administrator for HSBC
Bank USA, National Association, as Trustee, in trust for registered
Holders of
the Class M Certificates of Wells Fargo Home Equity Asset-Backed
Securities 200
- Trust, Home Equity Asset-Backed Certificates, Series 200 - ," and
which must
be an Eligible Account. Amounts on deposit in the Reserve Account
shall not be
invested. The Reserve Account shall not be an asset of any REMIC
formed under
this Agreement.
"Residential Dwelling" Any one of the following: (i) a detached
one-family dwelling, (ii) a detached two- to four-family dwelling,
(iii) a
one-family dwelling unit in a condominium project, (iv) a
manufactured home, or
(v) a detached one-family dwelling in a planned unit development,
none of which
is a co-operative or mobile home.
"Residual Certificate" Either of the Class R or Class R-X
Certificate.
"Residual Interest" The sole Class of "residual interests" in
each
REMIC within the meaning of Section 860G(a)(2) of the Code.
"Responsible Officer" When used with respect to the Trustee,
the
Securities Administrator or the Custodian, any officer assigned to
its Corporate
Trust Office (or any successor thereto), including any Vice
President, Assistant
Vice President, Trust Officer, any Assistant Secretary, any trust
officer or any
other officer of the Trustee or the Securities Administrator
customarily
performing functions similar to those performed by any of the above
designated
officers and in each case having direct responsibility for the
administration of
this Agreement. When used with respect to the Servicer, a Servicing
Officer.
"Retained Mortgage File" A file maintained by Wells Fargo Bank
prior
to any Document Transfer Date for each Mortgage Loan that contains
the documents
specified in Section 2.01(b) and any additional documents required
to be added
to the Retained Mortgage File pursuant to this Agreement.
"Sarbanes Oxley Certification" As defined in Section 3.28(b)
hereof.
"Securities Administrator" Wells Fargo Bank, or any successor
Securities Administrator appointed as herein provided.
"Seller" Wells Fargo Bank, or its successor in interest, in its
capacity as seller under the Mortgage Loan Purchase Agreement.
"Senior Certificates" The Class A Certificates.
"Senior Enhancement Percentage" For any Distribution Date, the
percentage obtained by dividing (x) the sum of (i) the aggregate
Principal
Balance of the Class M Certificates before taking into account the
distribution
of the Principal Distribution Amount on such Distribution Date and
(ii) the
Overcollateralization Amount as of the prior Distribution Date by
(y) the Pool
Balance as of the last day of the related Collection Period.
"Senior Principal Distribution Amount" For any Distribution
Date,
the sum of the Group I Senior Principal Distribution Amount for
such
Distribution Date and the Group II Senior Principal Distribution
Amount for such
Distribution Date.
"Senior Specified Enhancement Percentage" On any date of
determination thereof, [ ]%.
"Sequential Trigger Event" With respect to any Distribution Date
if
(i) the aggregate Principal Balance of the Class M Certificates is
reduced to
zero, (ii) with respect to any Distribution Date on or prior to the
Distribution
Date in [ ] 20 , the aggregate amount of Realized Losses incurred
since the
Cut-off Date through the last day of the related Collection Period
(reduced by
the aggregate amount of Subsequent Recoveries received since the
Cut-off Date
through the last day of the related Collection Period) divided by
the Pool
Balance on the Cut-off Date exceeds [ ]% or (iii) with respect to
any
Distribution Date on or after the Distribution Date in [ ] 20 , a
Trigger Event
is in effect.
"Servicer" Wells Fargo Bank, or any successor servicer appointed
as
herein provided, in its capacity as Servicer hereunder. Initially
the servicing
functions performed by Wells Fargo Bank shall be performed by the
Wells Fargo
Home Mortgage division of Wells Fargo Bank.
"Servicer Event of Termination" One or more of the events
described
in Section 7.01.
"Servicer Modification" A modification to the terms of a
Mortgage
Loan, in accordance with the terms of Section 3.01, as to which the
Mortgagor is
in default or as to which, in the judgment of the Servicer, default
is
reasonably foreseeable.
"Servicer Prepayment Penalty Payment Amount" The amount payable
by
the Servicer in respect of any waived Prepayment Penalties pursuant
to Section
3.01, which amount shall be equal to the difference between the
amount of
Prepayment Penalty due by a Mortgagor before any waiver and the
actual amount of
the Prepayment Penalty that was paid by the Mortgagor.
"Servicer Remittance Date" With respect to any Distribution
Date,
the 22nd day of the month of such Distribution Date, or if any such
day is not a
Business Day, the preceding Business Day.
"Servicing Advances" All customary, reasonable and necessary "out
of
pocket" costs and expenses incurred by the Servicer (including
reasonable
attorneys' fees and disbursements) in the performance of its
servicing
obligations, including, but not limited to, the cost of (i) the
preservation,
restoration, inspection and protection of the Mortgaged Property,
(ii) any
enforcement or judicial proceedings, including foreclosures, (iii)
the
management and liquidation of the REO Property and (iv) compliance
with the
obligations under Section 3.08.
"Servicing Criteria" The "servicing criteria" set forth in Item
1122(d) of Regulation AB, as such may be amended from time to
time.
"Servicing Fee" With respect to each Mortgage Loan (including
each
REO Property) and for any calendar month, an amount equal to one
month's
interest (or in the event of any payment of interest which
accompanies a
Principal Prepayment in full made by the Mortgagor during such
calendar month,
interest for the number of days covered by such payment of
interest) at the
Servicing Fee Rate on the same principal amount on which interest
on such
Mortgage Loan accrues for such calendar month.
"Servicing Fee Rate" With respect to each Mortgage Loan, [ ]%
per
annum.
"Servicing Function Participant" Any Subservicer, Subcontractor
or
any other Person, other than the Securities Administrator, the
Trustee, the
Custodian and the Servicer, that is performing activities addressed
by the
Servicing Criteria.
"Servicing Officer" Any officer of the Servicer involved in, or
responsible for, the administration and servicing of Mortgage
Loans, whose name
and specimen signature appear on a list of servicing officers
furnished by the
Servicer to the Trustee, the Securities Administrator and the
Depositor, as such
list may from time to time be amended.
"Servicing
Standard" The standards set forth in Section 3.01.
"Startup Day" As defined in Section 9.01(b) hereof.
"Stayed Funds" Any payment required to be made under the terms
of
the Certificates and this Agreement but which is not remitted by
the Servicer
because the Servicer is the subject of a proceeding under the
Bankruptcy Code
and the making of such remittance is prohibited by Section 362 of
the Bankruptcy
Code.
"Stepdown Date" The earlier to occur of (i) the Distribution
Date
following the Distribution Date on which the aggregate Principal
Balance of the
Senior Certificates is reduced to zero and (ii) the later to occur
of (x) the
Distribution Date in [ ] 20 and (y) the Distribution Date on which
the Senior
Enhancement Percentage is greater than or equal to the Senior
Specified
Enhancement Percentage.
"Subcontractor" Any vendor, subcontractor or other Person that
is
not responsible for the overall servicing of Mortgage Loans but
performs one or
more discrete functions identified in Item 1122(d) of Regulation AB
with respect
to Mortgage Loans under the direction or authority of the Servicer
(or a
Subservicer of the Servicer), the Securities Administrator, the
Trustee or the
Custodian.
"Subordination Depletion Date" The Distribution Date on which
the
aggregate Principal Balance of the Class M Certificates is reduced
to zero.
"Subsequent Recovery" Any amount (net of reimbursable expenses)
received on a Mortgage Loan subsequent to such Mortgage Loan being
determined to
be a Liquidated Mortgage Loan that resulted in a Realized Loss in a
prior month.
"Subservicer" Any Person that (i) services Mortgage Loans on
behalf
of the Servicer, and (ii) is responsible for the performance
(whether directly
or through Subservicers or Subcontractors) of a substantial portion
of the
material servicing functions required to be performed under this
Agreement or
any sub-servicing agreement that are identified in Item 1122(d) of
Regulation
AB.
"Substitution Adjustment Amount" As defined in Section 2.03(d)
hereof.
"Targeted Overcollateralization Amount" As of any Distribution
Date,
(x) prior to the Stepdown Date, [ ]% of the Pool Balance as of the
Cut-off Date
and (y) on and after the Stepdown Date, (i) if a Trigger Event has
not occurred
for such Distribution Date, the greater of (A) [ ]% of the Pool
Balance as of
the last day of the related Collection Period and (B) [ ]% of the
Pool Balance
as of the Cut-off Date and (ii) if a Trigger Event has occurred for
such
Distribution Date, the Targeted Overcollateralization Amount for
the immediately
preceding Distribution Date.
"Tax Matters Person" The tax matters person appointed pursuant
to
Section 9.01(e) hereof.
"Tax Returns" The federal income tax returns on Internal
Revenue
Service Form 1066, U.S. Real Estate Mortgage Investment Conduit
Income Tax
Return, including Schedule Q thereto, Quarterly Notice to Residual
Interest
Holders of the REMIC Taxable Income or Net Loss Allocation, or any
successor
forms, to be filed on behalf of the Trust for each of the three
REMICs created
pursuant to this Agreement under the REMIC Provisions, together
with any and all
other information reports or returns that may be required to be
furnished to the
Certificateholders or filed with the Internal Revenue Service or
any other
governmental taxing authority under any applicable provisions of
federal, state
or local tax laws.
"Telerate Page 3750" The display page currently so designated on
the
Moneyline Telerate Service (or such other page as may replace the
Telerate Page
3750 page on the Moneyline Telerate Service for the purpose of
displaying London
interbank offered rates of major banks).
"Termination
Price" As defined in Section 10.01(a) hereof.
"Trigger Event" With respect to any Distribution Date, if (i)
the
three-month rolling average of 60+ Day Delinquent Loans equals or
exceeds [ ]%
of the Senior Enhancement Percentage or (ii) the aggregate amount
of Realized
Losses incurred since the applicable Cut-off Date through the last
day of the
related Collection Period (reduced by the aggregate amount of
Subsequent
Recoveries received since the applicable Cut-off Date through the
end of the
last day of the related Collection Period) divided by the Pool
Balance on the
Cut-off Date exceeds the applicable percentages set forth below
with respect to
such Distribution Date:
Distribution Date Occurring In
Percentage
-------------------------------------
-------------------------------------
[ ] through [
]..........
[ ]%
[ ] through [
]..........
[ ]%
[ ] through [
]..........
[ ]%
[ ] and
thereafter ..........
[ ]%
"Trust" Wells Fargo Home Equity Asset-Backed Securities 200 -
Trust,
the New York common law trust created hereunder.
"Trust Fund" The segregated pool of assets subject hereto,
constituting the primary trust created hereby and to be
administered hereunder,
with respect to a portion of which three REMIC elections are to be
made, such
entire Trust Fund consisting of: (i) such Mortgage Loans as from
time to time
are subject to this Agreement, together with the Mortgage Files
relating
thereto, and together with all collections thereon and proceeds
thereof, (ii)
any REO Property, together with all collections thereon and
proceeds thereof,
(iii) the Trustee's rights with respect to the Mortgage Loans under
all
insurance policies required to be maintained pursuant to this
Agreement and any
proceeds thereof, (iv) the Depositor's rights under the Mortgage
Loan Purchase
Agreement (including any security interest created thereby), (v)
the Securities
Administrator's rights under the Yield Maintenance Agreement and
(vi) the
Collection Account, the Distribution Account and the Reserve
Account and such
assets that are deposited therein from time to time and any
investments thereof,
together with any and all income, proceeds and payments with
respect thereto.
"Trustee" HSBC Bank USA, National Association, a national
banking
association, in its capacity as trustee hereunder, or any successor
Trustee
appointed as herein provided.
"Uncertificated Accrued Interest" With respect to each REMIC 1
Regular Interest on each Distribution Date, an amount equal to one
month's
interest at the related Uncertificated Pass-Through Rate on the
Uncertificated
Principal Balance of such REMIC Regular Interest. In each case,
Uncertificated
Accrued Interest will be reduced by any Prepayment Interest
Shortfalls and
Relief Act Interest Shortfalls (allocated to such REMIC Regular
Interests based
on their respective entitlements to interest irrespective of any
Prepayment
Interest Shortfalls and Relief Act Interest Shortfalls for such
Distribution
Date).
"Uncertificated Principal Balance" The amount of any REMIC 1
Regular
Interest outstanding as of any date of determination. As of the
Closing Date,
the Uncertificated Balance of each REMIC 1 Regular Interest shall
equal the
amount set forth in the Preliminary Statement hereto as its
initial
uncertificated balance. On each Distribution Date, the
Uncertificated Principal
Balance of each REMIC 1 Regular Interest shall be reduced by all
distributions
of principal made on such REMIC 1 Regular Interest on such
Distribution Date
pursuant to Section 4.08 and, if and to the extent necessary and
appropriate,
shall be further reduced on such Distribution Date by Realized
Losses as
provided in Section 4.08(b). The Uncertificated Balance of REMIC 1
Regular
Interest LT1ZZ shall be increased by interest deferrals as provided
in Section
4.08(a)(i). The Uncertificated Balance of each REMIC 1 Regular
Interest shall
never be less than zero.
"Uncertificated REMIC 1 Pass-Through Rate" With respect to REMIC
1
Regular Interest LT1AA, REMIC 1 Regular Interest LT1AI1A, REMIC 1
Regular
Interest LT1AI1B, REMIC 1 Regular Interest LT1AII1, REMIC 1 Regular
Interest
LT1AII2, REMIC 1 Regular Interest LT1AII3, REMIC 1 Regular Interest
LT1M1, REMIC
1 Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1
Regular
Interest LT1M4, REMIC 1 Regular Interest LT1M5, REMIC 1 Regular
Interest LT1M6,
REMIC 1 Regular Interest LT1M7, REMIC 1 Regular Interest LT1M8,
REMIC 1 Regular
Interest LT1M9, REMIC 1 Regular Interest LT1M10, REMIC 1 Regular
Interest
LT1M11, REMIC 1 Regular Interest LT1M12, REMIC 1 Regular Interest
LT1M13, REMIC
1 Regular Interest LT1ZZ, REMIC 1 Regular Interest LT1SUB, REMIC 1
Regular
Interest LT2SUB and REMIC 1 Regular Interest LT1XX, the Weighted
Average Net
Mortgage Interest Rate of the Mortgage Loans. With respect to REMIC
1 Regular
Interest LT1GRP, the Weighted Average Net Mortgage Interest Rate of
the Group I
Mortgage Loans. With respect REMIC 1 Regular Interest LT2GRP, the
Weighted
Average Net Mortgage Interest Rate of the Group II Mortgage
Loans.
"United States Person" or "U.S. Person" (i) A citizen or resident
of
the United States, (ii) a corporation, partnership or other entity
treated as a
corporation or partnership for United States federal income tax
purposes
organized in or under the laws of the United States or any state
thereof or the
District of Columbia (unless, in the case of a partnership,
Treasury Regulations
provide otherwise), (iii) an estate the income of which is
includible in gross
income for United States tax purposes, regardless of its source, or
(iv) a trust
if a court within the United States is able to exercise primary
supervision over
the administration of the trust and one or more United States
persons have
authority to control all substantial decisions of the trust.
Notwithstanding the
preceding sentence, to the extent provided in Treasury Regulations,
certain
Trusts in existence on August 20, 1996, and treated as United
States persons
prior to such date, that elect to continue to be treated as United
States
persons will also be a U.S. Person; provided, that for purposes of
the
definition of a "Permitted Transferee," a U.S. Person shall not
include any
person whose income is attributable to a foreign permanent
establishment or
fixed base, within the meaning of an applicable income tax treaty,
of such
Person or any other Person.
"Unpaid Realized Loss Amount" For any Class of Class M
Certificates
and as to any Distribution Date, the excess of (x) the aggregate
Applied
Realized Loss Amounts applied with respect to such Class for all
prior
Distribution Dates over (y) the sum of (a) the aggregate amount of
any
Subsequent Recoveries allocated to such Class and (b) the aggregate
Realized
Loss Amortization Amounts with respect to such Class for all prior
Distribution
Dates.
"Value" With respect to any Mortgaged Property, the value thereof
as
determined by an independent appraisal made at the time of the
origination of
the related Mortgage Loan or the sale price, if the appraisal is
not available.
"Voting Interests" The portion of the voting rights of all of
the
Certificates which is allocated to any Certificate. The Voting
Interests
allocated among Holders of the Certificates (other than the Class
CE, Class P
and Residual Certificates) shall be 98%, and shall be allocated
among each such
Class according to the fraction, expressed as a percentage, the
numerator of
which is the aggregate Principal Balance of all the Certificates of
such Class
then outstanding and the denominator of which is the aggregate
Principal Balance
of all the Certificates (other than the Class CE, Class P and
Residual
Certificates) then outstanding. The Voting Interests allocated to
each such
Class of Certificates shall be allocated among all holders of each
such Class in
proportion to the outstanding Principal Balance of such
Certificates; provided,
however, that any Certificate registered in the name of the
Servicer, the
Depositor, the Securities Administrator or the Trustee or any of
their
respective affiliates shall not be included in the calculation of
Voting
Interests; provided that only such Certificates as are known by a
Responsible
Officer of the Securities Administrator to be so registered will be
so excluded.
One percent of all the Voting Interests will be allocated to the
Holders of each
of the Class CE and Class P Certificates. The Class R and Class R-X
Certificates
shall have no Voting Interests.
"Weighted Average Net Mortgage Interest Rate" The weighted
average
(based on the unpaid principal balance of the related Mortgage
Loans as of the
first day of the related Collection Period or, in the case of the
first
Distribution Date, the applicable Cut-off Date) of the Net Mortgage
Interest
Rates of the Mortgage Loans, the Group I Mortgage Loans or the
Group II Mortgage
Loans, as applicable, expressed for each such Mortgage Loan as an
annual rate
and calculated on the basis of twelve months consisting of 30 days
each and a
360 day year.
"Wells Fargo Bank" Wells Fargo Bank, N.A., a national banking
association, or its successor in interest.
"Wells Fargo Bank Correspondents" The entities identified on a
list
provided by Wells Fargo Bank to the Servicer, from which Wells
Fargo Bank
purchased the Mortgage Loans.
"Written Order to Authenticate" A written order by which the
Depositor directing the Securities Administrator to execute,
authenticate and
deliver the Certificates.
"Yield Maintenance Agreement" The yield maintenance agreement
between the Securities Administrator, on behalf of the Trust, and
the Yield
Maintenance Agreement Provider substantially in the form attached
hereto as
Exhibit N. The Yield Maintenance Agreement shall not be an asset of
any REMIC
formed under this Agreement.
"Yield Maintenance Agreement Payment" On each Distribution Date
through the Distribution Date in [ ] 20 , the amount equal to the
product of (a)
the excess of the lesser of (i) One-Month LIBOR and (ii) the
applicable upper
strike rate for such Distribution Date over the lower strike rate
for such
Distribution Date, in each case as set forth on the schedule
attached to the
Yield Maintenance Agreement for such Distribution Date, (b) the
notional amount
as set forth on the schedule attached to the Yield Maintenance
Agreement for
such Distribution Date and (c) a fraction, the numerator of which
is the actual
number of days elapsed since the previous Distribution Date (or the
Closing
Date, in the case of the first Distribution Date) to but excluding
the current
Distribution Date and the denominator of which is 360.
"Yield Maintenance Agreement Provider" [ ], and any successor
thereto.
Section 1.02 Accounting. Unless otherwise specified herein, for
the
purpose of any definition or calculation, whenever amounts are
required to be
netted, subtracted or added or any distributions are taken into
account such
definition or calculation and any related definitions or
calculations shall be
determined without duplication of such functions.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01 Conveyance of Mortgage Loans. (a) The Depositor,
concurrently with the execution and delivery hereof, does hereby
transfer,
assign, set over and otherwise convey to the Trustee, on behalf of
the Trust,
without recourse for the benefit of the Certificateholders all the
right, title
and interest of the Depositor, including any security interest
therein for the
benefit of the Depositor, in and to (i) each Mortgage Loan
identified on the
Mortgage Loan Schedules, including the related Cut-off Date
Principal Balance,
all interest accruing thereon after the applicable Cut-off Date and
all
collections in respect of interest and principal due after the
applicable
Cut-off Date; (ii) property which secured each such Mortgage Loan
and which has
been acquired by foreclosure or deed in lieu of foreclosure; (iii)
its interest
in any insurance policies in respect of the Mortgage Loans; (iv)
all other
assets included or to be included in the Trust Fund; (v) all
proceeds of any of
the foregoing; and (vi) the rights of the Depositor under the
Mortgage Loan
Purchase Agreement. Such assignment includes all interest and
principal due to
the Depositor or the Servicer after the applicable Cut-off Date
with respect to
the Mortgage Loans. It is agreed and understood by the Depositor
and the Trustee
that it is not intended that any mortgage loan be included in the
Trust Fund
that is a "High-Cost Home Loan" as defined in (i) the New Jersey
Home Ownership
Act effective November 27, 2003, (ii) the New Mexico Home Loan
Protection Act
effective January 1, 2004, (iii) the Massachusetts Predatory Home
Loan Practices
Act, effective November 7, 2004 or (iv) the Indiana Home Loan
Practices Act,
effective January 1, 2005.
In connection with such assignment, the Depositor shall, with
respect to each Mortgage Loan, deliver, or cause to be delivered,
to the
Custodian, on or before the Closing Date the following documents or
instruments
with respect to each Mortgage Loan:
(i) The original Mortgage Note either (A) endorsed in blank or
(B)
endorsed
as provided in Section 2.01(d), with all prior and intervening
endorsements as may be necessary to show a complete chain of
endorsements
or with respect
to any Mortgage Loan as to which the original Mortgage
Note has
been permanently lost or destroyed and has not been replaced, a
lost note
affidavit with a copy of the Mortgage Note and, in the case of
any
Mortgage Loan originated in the State of New York documented by
a
NYCEMA,
the NYCEMA, the new Mortgage Note, if applicable, the
consolidated
Mortgage
Note and the consolidated Mortgage;
(ii) A recorded original assignment of the related Mortgage
from
Wells
Fargo Bank assigning the related Mortgage to the Trustee,
certified
by the
recording office, or, if such assignment is in the process of
being
recorded,
a copy of the related Mortgage transmitted for recordation
certified
by an officer of Wells Fargo Bank or applicable Wells Fargo
Bank
Correspondent to be a true and correct copy of such assignment
submitted
for
recordation; provided, however, if recordation is not required
as
described
below, an assignment in recordable form (which may be assigned
in blank)
with respect to the related Mortgage;
(iii) The original of each assumption agreement, modification,
written
assurance or substitution agreement pertaining to such Mortgage
Note, if any;
and
(iv) For each Mortgage Loan secured by Co-op Shares, the
originals
of the
following documents or instruments:
(A) The loan security agreement;
(B) The stock certificate;
(C) The stock power, executed in blank;
(D) The executed proprietary lease;
(E) The executed recognition agreement;
(F) The executed UCC-1 financing statement with evidence of
recording thereon; and
(G) The executed UCC-3 financing statements or other
appropriate UCC financing statements required by state law,
evidencing a complete and unbroken chain from the mortgagee to
the
Trustee with evidence
of recording thereon (or in a form suitable
for recordation).
(b) The Securities Administrator shall promptly notify the
Depositor, the Trustee and the Custodian of the occurrence of any
Document
Transfer Event of which the Servicer had knowledge. Following the
receipt of
such notice, the Depositor shall, with respect to each Mortgage
Loan, deliver,
or cause to be delivered, to the Custodian, no later than the
Document Transfer
Date, copies (which may be in electronic form mutually agreed upon
by the
Depositor and the Custodian) of the following additional documents
or
instruments with respect to each Mortgage Loan; provided, however,
that
originals of such documents or instruments shall be delivered to
the Custodian
if originals are required under the law in which the related
Mortgaged Property
is located in order to exercise all remedies available to the Trust
under
applicable law following default by the related Mortgagor:
(i) The original recorded Mortgage with evidence of recordation
noted
thereon or attached thereto, together with any addenda or
riders
thereto,
or a copy of such recorded Mortgage with such evidence of
recordation certified to be true and correct by the appropriate
governmental recording office; or a copy of such recorded Mortgage
with
such
evidence of recordation, or if the original Mortgage has been
submitted
for recordation but has not been returned from the applicable
public
recording office, a copy of the Mortgage certified by an officer
of
Wells
Fargo Bank or the applicable Wells Fargo Bank Correspondent to be
a
true and
correct copy of the original Mortgage submitted for
recordation;
(ii) The original of each assumption agreement, modification,
written
assurance or substitution agreement pertaining to such
Mortgage,
if any,
or, if such document is in the process of being recorded, a
copy
of such
document, certified by an officer of Wells Fargo Bank or the
applicable
Wells Fargo Bank Correspondent of such Mortgage Loan or by the
applicable
title insurance company, closing agent, settlement agent,
escrow
agent or closing attorney to be a true and correct copy of such
document
transmitted for recordation, if any;
(iii) For each MERS Mortgage Loan that is not a MOM Mortgage
Loan,
the
original assignment showing MERS as the assignee of the Mortgage,
with
evidence
of recording thereon or copies thereof certified by an officer
of
Wells
Fargo Bank or the applicable Wells Fargo Bank Correspondent to
have
been
submitted for recordation;
(iv) Each original recorded intervening assignment of the
Mortgage
as may be
necessary to show a complete chain of title from the Mortgage
Loan
originator to Wells Fargo Bank or Wells Fargo Home Mortgage,
Inc.,
with
evidence of recordation noted thereon or attached thereto, or a
copy
of such
assignment with such evidence of recordation to be true and
correct by
the appropriate governmental recording office, or, if any such
assignment
has been submitted for recordation but has not been returned
from the
applicable public recording office or is not otherwise
available,
a copy of
such assignment certified by an officer of Wells Fargo Bank or
the
applicable Wells Fargo Bank Correspondent to be a true and
correct
copy of
the recorded assignment submitted for recordation; and
(v) The original policy of the title insurance or certificate
of
title
insurance or a written commitment to issue such a title
insurance
policy or
certificate of title insurance, or a copy of such title
insurance
certified as true and correct by the applicable insurer or any
attorney's
certificate of title with an Officer's Certificate of Wells
Fargo Bank
or the applicable Wells Fargo Bank Correspondent that such
attorney's
certificate of title is customarily used in lieu of a title
insurance
policy in the jurisdiction in which the related mortgage
property
is located.
(c) If any assignment of a Mortgage to the Trustee is in the
process
of being recorded on the Closing Date, the Depositor shall use its
best efforts
to cause each such original recorded document or certified copy
thereof to be
delivered to the Custodian promptly following its recordation, but
in no event
later than one (1) year following the Closing Date. If any Mortgage
has been
recorded in the name of MERS or its designee, no assignment of
Mortgage in favor
of the Trustee will be required to be prepared or delivered and
instead, the
Master Servicer shall take all actions as are necessary to cause
the Trust Fund
to be shown as the owner of the related Mortgage Loan on the
records of MERS for
the purpose of the system of recording transfers of beneficial
ownership of
mortgages maintained by MERS. The Depositor shall also cause to be
delivered to
the Custodian any other original mortgage loan document included in
the Owner
Mortgage File (and, if applicable, the Retained Mortgage File) if a
copy thereof
has been delivered. The Depositor shall pay from its own funds,
without any
right of reimbursement therefor, the amount of any costs,
liabilities and
expenses incurred by the Trust by reason of the failure of the
Depositor to
cause to be delivered to the Custodian within one (1) year
following the Closing
Date any assignment of a Mortgage (except with respect to any
Mortgage recorded
in the name of MERS) not delivered to the Custodian on the Closing
Date.
In lieu of recording an assignment of any Mortgage the
Depositor
may, deliver or cause to be delivered to the Custodian the
assignment of the
Mortgage Loan to the Trustee in a form suitable for recordation, if
(i) with
respect to a particular state the Trustee and the Custodian have
received an
Opinion of Counsel acceptable to it that such recording is not
required to make
the assignment effective against the parties to the Mortgage or
subsequent
purchasers or encumbrancers of the Mortgaged Property or (ii) the
Depositor has
been advised by each Rating Agency that non recordation in a state
will not
result in a reduction of the rating assigned by that Rating Agency
at the time
of initial issuance of the Certificates. Set forth on Exhibit Q
attached hereto
is a list of all states where recordation is required by either
Rating Agency to
obtain the initial ratings of the Certificates. The Custodian may
rely and shall
be protected in relying upon the information contained in such
Exhibit Q. In the
event that the Custodian receives notice that recording is required
to protect
the right, title and interest of the Trustee in and to any such
Mortgage Loan
for which recordation of an assignment has not previously been
required, the
Custodian shall promptly notify the Trustee and the Custodian shall
within five
Business Days (or such other reasonable period of time mutually
agreed upon by
the Custodian and the Trustee) of its receipt of such notice
deliver each
previously unrecorded assignment to the related Servicer for
recordation.
(d) Except for Mortgage Notes endorsed in blank, endorsements
shall
comply with the following format:
WITHOUT RECOURSE
PAY TO THE ORDER OF:
HSBC BANK USA, NATIONAL ASSOCIATION, AS
TRUSTEE under the pooling and servicing
agreement dated as of [[ ], 200 ].
and its successors and assigns,
[Wells Fargo Bank, N.A.][Wells Fargo Home Mortgage, Inc.]
[Signature of Officer]
[Officer's Name and Title]
Except where assignments in blank are authorized or in the case
of
any Mortgage registered in the name of MERS, assignments of any
Mortgage shall
comply with the following:
HSBC BANK USA, NATIONAL ASSOCIATION, AS
TRUSTEE
and its successors and assigns
(e) Concurrently with the execution and delivery of this
Agreement,
the Depositor shall deliver the Mortgage Loan Schedule to the
Trustee, the
Securities Administrator, the Servicer and the Custodian. The
Depositor and the
Securities Administrator shall provide a copy of the Mortgage Loan
Schedule to
any Certificateholders upon written request made to it at the
addresses set
forth on Exhibit D, as the same may be amended from time to time by
written
notice from such party to the other parties hereto.
(f) The Securities Administrator shall monitor the rating of
Wells
Fargo & Company and upon the occurrence of a Document Transfer
Event relating to
such rating, shall promptly notify the Servicer, Depositor, Trustee
and
Custodian of the occurrence of such Document Transfer Event.
Section 2.02 Acceptance by Custodian. The Custodian, on behalf
of
the Trustee, acknowledges the receipt of, subject to the provisions
of Section
2.01 and subject to the review described below and any exceptions
noted on the
exception report described in the next paragraph below, the
documents referred
to in Section 2.01 above and all other assets included in the
definition of
"Trust Fund" and declares that it holds and will hold such
documents and the
other documents delivered to it constituting the Owner Mortgage
File (and in the
case of a Document Transfer Event, the Retained Mortgage File), and
that it
holds or will hold all such assets and such other assets included
in the
definition of "Trust Fund" in trust for the exclusive use and
benefit of all
present and future Certificateholders.
The Custodian, for the benefit of the Certificateholders, shall
execute and deliver to the Servicer, the Securities Administrator,
the Trustee
and the Depositor on or prior to the Closing Date an initial
certification in
the form attached hereto as Exhibit F-1 hereto, to the effect that,
except as
may be specified in a list of exceptions attached thereto, it has
received the
original Mortgage Notes (described in Section 2.01(a)(i)) relating
to each
Mortgage Loan listed in the Mortgage Loan Schedules (other than any
Mortgage
Loan that has been paid in full, liquidated or otherwise released
as of the date
of such certification, and subject to any exceptions specifically
identified in
the exception report annexed to such certification).
The Custodian will review each Owner Mortgage File within 45
days
after execution of this Agreement. The Custodian will deliver no
later than 30
days after completion of such review to the Servicer, the
Securities
Administrator, the Trustee and the Depositor a final certification
in the form
of Exhibit F-2 hereto to the effect that, except as may be
specified in a list
of exceptions attached thereto, all required documents set forth in
Section
2.01(a) have been executed and received and appear regular on their
face, and
that such documents relate to the Mortgage Loans identified in the
Mortgage Loan
Schedule based on a comparison of the Mortgage Loan identifying
number,
Mortgagor name and street address, and in so doing the Custodian
may rely on the
purported due execution and genuineness of any such document and on
the
purported genuineness of any signature thereon.
If in the process of
reviewing the Mortgage Files and making or
preparing, as the case may be, the certifications referred to
above, the
Custodian finds any document or documents constituting a part of a
Mortgage File
to be missing or defective in any material respect, at the
conclusion of its
review the Custodian shall so notify the Depositor, the Trustee,
the Securities
Administrator and the Servicer.
The Depositor and the Trustee intend that the assignment and
transfer herein contemplated constitute a sale of the Mortgage
Loans and the
Related Documents, conveying good title thereto free and clear of
any liens and
encumbrances, from the Depositor to the Trustee and that such
property not be
part of the Depositor's estate or property of the Depositor in the
event of any
insolvency by the Depositor. In the event that such conveyance is
deemed to be,
or to be made as security for, a loan, the parties intend that the
Depositor
shall be deemed to have granted and does hereby grant to the
Trustee, on behalf
of the Trust, a first priority perfected security interest in all
of the
Depositor's right, title and interest in and to the Mortgage Loans
and the
Related Documents, and that this Agreement shall constitute a
security agreement
under applicable law.
The Securities Administrator is hereby directed to execute and
deliver, on behalf of the Trust, the Yield Maintenance
Agreement.
Section 2.03 Repurchase or Substitution of Mortgage Loans by
the
Depositor. (a) Upon discovery or receipt of written notice of any
materially
defective document in, or that a document is missing from, an Owner
Mortgage
File (or, if applicable, a Retained Mortgage File) or of a breach
of a
representation of warranty of the Depositor in Section 2.04 hereof,
in respect
of any Mortgage Loan and, except for a breach of the
representations and
warranties set forth in clause (ee) of Section 2.04, such breach
materially
adversely affects the value of such Mortgage Loan, Prepayment
Penalty or the
interest therein of the Certificateholders, the Trustee (or the
Custodian) shall
promptly notify the Depositor and the Servicer of such defect,
missing document
or breach and request that the Depositor cure such defect or breach
or deliver
such missing document within 60 days from the date the Depositor
was notified of
such missing document, breach or defect. If the Depositor does not
deliver such
missing document or cure such defect or cure such breach in all
material
respects during such period, the Depositor shall repurchase such
Mortgage Loan
from the Trust Fund at the Purchase Price on or prior to the
Determination Date
following the expiration of such period (subject to Section 2.03(d)
and the last
paragraph of this Section 2.03(a)). The Purchase Price for the
repurchased
Mortgage Loan shall be deposited in the Collection Account, and the
Custodian,
upon receipt of written notice from the Servicer of such deposit,
shall release
to the Depositor the related Owner Mortgage File (and, if
applicable, Retained
Mortgage File). The Trustee shall execute and deliver such
instruments of
transfer or assignment (or, in the case of a Mortgage Loan
registered in the
name of MERS or its designee, the Servicer shall reflect such
assignment on the
records of MERS), in each case without recourse, as the Depositor
shall furnish
to it and as shall be necessary to vest in the Depositor any
Mortgage Loan
released pursuant hereto and the Custodian and the Trustee shall
have no further
responsibility with regard to such Owner Mortgage File (and, if
applicable,
Retained Mortgage File). In lieu of repurchasing any such Mortgage
Loan as
provided above, the Depositor may cause such Mortgage Loan to be
removed from
the Trust Fund (in which case it shall become a Defective Mortgage
Loan) and
substitute one or more Eligible Substitute Mortgage Loans in the
manner and
subject to the limitations set forth in Section 2.03(d).
It is understood and agreed that the representations and
warranties
set forth in Section 2.04 hereof shall survive delivery of the
Owner Mortgage
Files (and, if applicable, Retained Mortgage Files) to the
Custodian and shall
inure to the benefit of the Certificateholders notwithstanding any
restrictive
or qualified endorsement or assignment. It is understood and agreed
that the
obligations of the Depositor set forth in this Section 2.03(a) to
cure,
substitute for or repurchase a Mortgage Loan and to pay the
Reimbursement Amount
constitute the sole remedies available to the Certificateholders
and to the
Trustee on their behalf respecting a breach of the representations
and
warranties in Section 2.04 hereof.
(b) In addition to the foregoing, in the case of a breach of
the
Depositor's representation set forth in Section 2.04(i) hereof, the
Depositor
shall pay to the Trust the Reimbursement Amount. The Reimbursement
Amount shall
be delivered to the Servicer for deposit into the Collection
Account within 10
days from the date the Depositor was notified by the Trustee of the
amount of
such costs and damages.
(c) Within 90 days of the earlier of discovery by the Servicer
or
receipt of notice by the Servicer of the breach of any
representation, warranty
or covenant of the Servicer set forth in Section 2.05 which
materially and
adversely affects the interests of the Certificateholders in any
Mortgage Loan,
the Servicer shall cure such breach in all material respects.
(d) Any substitution of Eligible Substitute Mortgage Loans for
Defective Mortgage Loans made pursuant to Section 2.03(a) must be
effected prior
to the last Business Day that is within two years after the Closing
Date. As to
any Defective Mortgage Loan for which the Depositor substitutes an
Eligible
Substitute Mortgage Loan or Loans, such substitution shall be
effected by the
Depositor delivering to the Custodian, on the Trustee's behalf for
such Eligible
Substitute Mortgage Loan or Loans, the documents required by
Section 2.01,
together with an Officers' Certificate providing that each such
Eligible
Substitute Mortgage Loan satisfies the definition thereof and
specifying the
Substitution Adjustment Amount (as described below), if any, in
connection with
such substitution. The Custodian shall acknowledge receipt for such
Eligible
Substitute Mortgage Loan or Loans and, within ten Business Days
thereafter, the
Custodian shall review such documents as specified in Section 2.02
and deliver
to the Servicer and the Trustee, with respect to such Eligible
Substitute
Mortgage Loan or Loans, a certification substantially in the form
attached
hereto as Exhibit F-1, with any applicable exceptions noted
thereon. Within one
year of the date of substitution, the Custodian shall deliver to
the Servicer
and the Trustee a certification substantially in the form of
Exhibit F-2 hereto
with respect to such Eligible Substitute Mortgage Loan or Loans,
with any
applicable exceptions noted thereon. Monthly Payments due with
respect to
Eligible Substitute Mortgage Loans in the month of substitution are
not part of
the Trust Fund and will be retained by the Depositor. For the month
of
substitution, distributions to Certificateholders will reflect the
collections
and recoveries in respect of such Defective Mortgage Loan in the
Collection
Period or Prepayment Period, as applicable, preceding the date of
substitution
and the Depositor shall thereafter be entitled to retain all
amounts
subsequently received in respect of such Defective Mortgage Loan.
The Depositor
shall give or cause to be given written notice to the
Certificateholders that
such substitution has taken place, shall amend the applicable
Mortgage Loan
Schedule to reflect the removal of such Defective Mortgage Loan
from the terms
of this Agreement and the substitution of the Eligible Substitute
Mortgage Loan
or Loans and shall deliver a copy of such amended Mortgage Loan
Schedule to the
Trustee, the Servicer, the Securities Administrator and the
Custodian. Upon such
substitution, such Eligible Substitute Mortgage Loan or Loans shall
constitute
part of the Mortgage Pool and shall be subject in all respects to
the terms of
this Agreement, including all applicable representations and
warranties as of
the date of substitution.
For any month in which the Depositor substitutes one or more
Eligible Substitute Mortgage Loans for one or more Defective
Mortgage Loans, the
Servicer will determine the amount (the "Substitution Adjustment
Amount"), if
any, by which the aggregate Purchase Price of all such Defective
Mortgage Loans
exceeds the aggregate, as to each such Eligible Substitute Mortgage
Loan, of the
principal balance thereof as of the date of substitution, together
with one
month's interest on such principal balance at the applicable Net
Mortgage
Interest Rate. On the date of such substitution, the Depositor will
deliver or
cause to be delivered to the Servicer for deposit in the Collection
Account an
amount equal to the Substitution Adjustment Amount, if any, and the
Trustee,
upon receipt of the related Eligible Substitute Mortgage Loan or
Loans and
notice by the Servicer of such deposit, shall release to the
Depositor the
related Owner Mortgage File (and, if applicable, Retained Mortgage
File) and
shall execute and deliver such instruments of transfer or
assignment, in each
case without recourse, as the Depositor shall deliver to it and as
shall be
necessary to vest therein any Defective Mortgage Loan released
pursuant hereto.
In addition, the Depositor shall obtain at its own expense and
deliver to the Trustee an Opinion of Counsel to the effect that
such
substitution will not cause (a) any federal tax to be imposed on
the Trust Fund,
including without limitation, any federal tax imposed on
"prohibited
transactions" under Section 860F(a)(l) of the Code or on
"contributions after
the startup date" under Section 860G(d)(l) of the Code, or (b) any
REMIC created
hereunder to fail to qualify as a REMIC at any time that any
Certificate is
outstanding. If such Opinion of Counsel can not be delivered, then
such
substitution may only be effected at such time as the required
Opinion of
Counsel can be given.
(e) Upon discovery by the Depositor, the Seller, the Servicer,
the
Securities Administrator, the Custodian or the Trustee that any
Mortgage Loan
does not constitute a "qualified mortgage" within the meaning of
Section
860G(a)(3) of the Code, the party discovering such fact shall
within two
Business Days give written notice thereof to the other parties. In
connection
therewith, the Depositor shall repurchase or, subject to the
limitations set
forth in Section 2.03(d), substitute one or more Eligible
Substitute Mortgage
Loans for the affected Mortgage Loan within 60 days of the earlier
of discovery
or receipt of such notice with respect to such affected Mortgage
Loan. In
addition, upon discovery that a Mortgage Loan is defective in a
manner that
would cause it to be a "defective obligation" within the meaning of
Treasury
Regulations relating to REMICs, the Depositor shall cure the defect
or make the
required purchase or substitution no later than 60 days after the
discovery of
the defect. Any such repurchase or substitution shall be made in
the same manner
as set forth in Section 2.03(a). The Trustee shall reconvey to the
Depositor 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.
(f) The Trustee shall be responsible for enforcing the
Depositor's
obligations under this Section 2.03. If the Trustee receives
written notice from
the Custodian or the Securities Administrator that the defect is
not cured by
the Depositor within 60 days after the Trustee's notice, the
Trustee shall
enforce the Depositor's obligation to repurchase such Mortgage Loan
or
substitute for such Mortgage Loan in accordance with the provisions
of this
Section 2.03. In connection with any substitution permitted by this
Section
2.03, the Trustee shall verify that the unpaid principal balance
and the
Loan-to-Value Ratio of the Eligible Substitute Mortgage Loan
satisfy the
requirements of this Section 2.03.
Section 2.04 Representations and Warranties of the Depositor
with
respect to the Mortgage Loans. The Depositor hereby represents and
warrants to
the Trustee for the benefit of the Certificateholders that as of
the Closing
Date or as of such other date specifically provided herein:
(a) The information set forth in the Mortgage Loan Schedules
was
true and correct in all material respects, including, without
limitation, the
information regarding any Prepayment Penalty, at the date or dates
respecting
which such information was furnished as specified in the Mortgage
Loan
Schedules;
(b) Immediately prior to the transfer and assignment
contemplated
herein, the Depositor was the sole owner and holder of the Mortgage
Loan free
and clear of any and all liens, pledges, charges or security
interests of any
nature and has full right and authority to sell and assign the
same;
(c) All payments required to be made up to the Due Date for
such
Mortgage Loan immediately preceding the Closing Date under the
terms of the
related Mortgage Note have been made and no Mortgage Loan had more
than one
delinquency in the 12 months preceding the applicable Cut-off
Date;
(d) The Mortgage Note, the related Mortgage and other
agreements
executed in connection therewith are genuine, and each is the
legal, valid and
binding obligation of the maker thereof, enforceable in accordance
with its
terms, except as such enforcement may be limited by bankruptcy,
insolvency,
reorganization or other similar laws affecting the enforcement of
creditors'
rights generally and by general equity principles (regardless of
whether such
enforcement is considered in a proceeding in equity or at law);
and, to the best
of the Depositor's knowledge, all parties to the Mortgage Note and
the Mortgage
had legal capacity to execute the Mortgage Note and the Mortgage
and each
Mortgage Note and Mortgage has been duly and properly executed by
the Mortgagor;
(e) All taxes, governmental assessments, insurance premiums,
and
water, sewer and municipal charges, which previously became due and
owing have
been paid, or an escrow of funds has been established, to the
extent permitted
by law, in an amount sufficient to pay for every such item which
remains unpaid;
and neither the Servicer nor the Depositor has advanced funds, or
received any
advance of funds by a party other than the Mortgagor, directly or
indirectly for
the payment of any amount required by the Mortgage, except for
interest accruing
from the date of the Mortgage Note or date of disbursement of the
Mortgage Loan
proceeds, whichever is later, to the day which precedes by thirty
days the first
Due Date under the related Mortgage Note;
(f) Neither the Depositor nor any prior holder of the Mortgage
or
the related Mortgage Note has modified the Mortgage or the related
Mortgage Note
in any material respect, satisfied, canceled or subordinated the
Mortgage in
whole or in part, released the Mortgaged Property in whole or in
part from the
lien of the Mortgage, or executed any instrument of release,
cancellation,
modification or satisfaction, except in each case as is reflected
in an
agreement delivered to the Trustee or the Custodian pursuant to
Section 2.01;
(g) No Mortgage Note or Mortgage is subject to any right of
rescission, set-off, counterclaim or defense, including the defense
of usury,
nor will the operation of any of the terms of the Mortgage Note or
Mortgage, or
the exercise of any right thereunder, render the Mortgage Note or
Mortgage
unenforceable, in whole or in part, or subject it to any right of
rescission,
set-off, counterclaim or defense, including the defense of usury,
and no such
right of rescission, set-off, counterclaim or defense has been
asserted with
respect thereto;
(h) The Mortgage is a valid, subsisting and enforceable first
lien
on the property therein described, and the Mortgaged Property is
free and clear
of all encumbrances and liens having priority over the first lien
of the
Mortgage except for liens for real estate taxes and special
assessments not yet
due and payable and liens or interests arising under or as a result
of any
federal, state or local law, regulation or ordinance relating to
hazardous
wastes or hazardous substances, and, if the related Mortgaged
Property is a
condominium unit, any lien for common charges permitted by statute
or homeowners
association fees; and any security agreement, chattel mortgage or
equivalent
document related to, and delivered to the Trustee or to the
Custodian with, any
Mortgage establishes in the Depositor a valid and subsisting first
lien on the
property described therein and the Depositor has full right to sell
and assign
the same to the Trustee;
(i) Each Mortgage Loan at the time it was originated complied in
all
material respects with applicable federal, state and local laws
including,
without limitation, truth-in-lending, real estate settlement
procedures,
consumer credit protection, equal credit opportunity, predatory and
abusive
lending laws and disclosure laws;
(j) Each Mortgaged Property is located in the United States and
consists of a one- to four-unit residential property, which may
include a
detached home, townhouse, condominium unit, a unit in a planned
unit development
or a manufacturing housing unit which constitutes real property for
purposes of
the applicable state law;
(k) Except for Mortgage Loans secured by residential long-term
leases, the Mortgaged Property consists of a fee simple estate in
real property;
all of the improvements which are included for the purpose of
determining the
appraised value of the Mortgaged Property lie wholly within the
boundaries and
building restriction lines of such property and no improvements on
adjoining
properties encroach upon the Mortgaged Property (unless insured
against under
the related title insurance policy); and to the best of the
Depositor's
knowledge, the Mortgaged Property and all improvements thereon
comply with all
requirements of any applicable zoning and subdivision laws and
ordinances;
(l) With respect to each Mortgage where a lost note affidavit
has
been delivered to the Custodian on the Trustee's behalf in place of
the related
Mortgage Note, the related Mortgage Note is no longer in
existence;
(m) The proceeds of the Mortgage Loans have been fully
disbursed,
there is no requirement for future advances thereunder and any and
all
requirements as to completion of any on-site or off-site
improvements and as to
disbursements of any escrow funds therefor have been complied with
(except for
escrow funds for exterior items which could not be completed due to
weather and
escrow funds for the completion of swimming pools); and all costs,
fees and
expenses incurred in making, closing or recording the Mortgage Loan
have been
paid, except recording fees with respect to Mortgages not recorded
as of the
Closing Date;
(n) The Mortgage Loan (except any Mortgage Loan secured by a
Mortgaged Property located in any jurisdiction, as to which an
opinion of
counsel of the type customarily rendered in such jurisdiction in
lieu of title
insurance is instead received) is covered by an American Land Title
Association
mortgagee title insurance policy or other generally acceptable form
of policy or
insurance acceptable to Fannie Mae or Freddie Mac, issued by a
title insurer
acceptable to Fannie Mae or Freddie Mac insuring the originator,
its successors
and assigns, as to the first priority lien of the Mortgage in the
original
principal amount of the Mortgage Loan and subject only to (A) the
lien of
current real property taxes and assessments not yet due and
payable, (B)
covenants, conditions and restrictions, rights of way, easements
and other
matters of public record as of the date of recording of such
Mortgage acceptable
to mortgage lending institutions in the area in which the Mortgaged
Property is
located or specifically referred to in the appraisal performed in
connection
with the origination of the related Mortgage Loan, (C) liens
created pursuant to
any federal, state or local law, regulation or ordinance affording
liens for the
costs of clean-up of hazardous substances or hazardous wastes or
for other
environmental protection purposes and (D) such other matters to
which like
properties are commonly subject which do not individually, or in
the aggregate,
materially interfere with the benefits of the security intended to
be provided
by the Mortgage; the Depositor is the sole insured of such
mortgagee title
insurance policy, the assignment to the Trustee of the Depositor's
interest in
such mortgagee title insurance policy does not require any consent
of or
notification to the insurer which has not been obtained or made,
such mortgagee
title insurance policy is in full force and effect and will be in
full force and
effect and inure to the benefit of the Trustee, no claims have been
made under
such mortgagee title insurance policy, and no prior holder of the
related
Mortgage, including the Depositor, has done, by act or omission,
anything which
would impair the coverage of such mortgagee title insurance
policy;
(o) To the best of the Depositor's knowledge, there is no
default,
breach, violation or event of acceleration existing under the
Mortgage or the
related Mortgage Note and no event which, with the passage of time
or with
notice and the expiration of any grace or cure period, would
constitute a
default, breach, violation or event of acceleration; the Depositor
has not
waived any default, breach, violation or event of acceleration; and
no
foreclosure action is currently threatened or has been commenced
with respect to
the Mortgage Loan;
(p) The Mortgaged Property is free and clear of all mechanics'
and
materialmen's liens or liens in the nature thereof; provided,
however, that this
warranty shall be deemed not to have been made at the time of the
initial
issuance of the Certificates if a title policy affording, in
substance, the same
protection afforded by this warranty is furnished to the Trustee by
the
Depositor;
(q) The Mortgage Loan meets, or is exempt from, applicable state
or
federal laws, regulations and other requirements, pertaining to
usury, and the
Mortgage Loan is not usurious;
(r) To the best of the Depositor's knowledge, all inspections,
licenses and certificates required to be made or issued with
respect to all
portions of the Mortgaged Property and, with respect to the use and
occupancy of
the same, including, but not limited to, certificates of occupancy
and fire
underwriting certificates, have been made or obtained from the
appropriate
authorities;
(s) Each Mortgage Note (other than with respect to any Balloon
Loans) is payable in monthly payments, resulting in complete
amortization of the
Mortgage Loan over a term of not more than 360 months;
(t) Each Mortgage contains customary and enforceable provisions
such
as to render the rights and remedies of the holder thereof adequate
for the
realization against the Mortgaged Property of the benefits of the
security,
including realization by judicial foreclosure (subject to any
limitation arising
from any bankruptcy, insolvency or other law for the relief of
debtors), and
there is no homestead or other exemption available to the Mortgagor
which would
interfere with such right of foreclosure;
(u) The Mortgaged Property is undamaged by water, fire,
earthquake,
earth movement other than earthquake, windstorm, flood, tornado or
similar
casualty (excluding casualty from the presence of hazardous wastes
or hazardous
substances, as to which the Depositor makes no representations), in
a matter
which would adversely affect the value of the Mortgaged Property as
security for
the Mortgage Loan or the use for which the premises were intended
and to the
best of the Depositor's knowledge, there is no proceeding pending
or threatened
for the total or partial condemnation of the Mortgaged
Property;
(v) The Mortgaged Property securing each Mortgage Loan is insured
by
an insurer acceptable to Fannie Mae or Freddie Mac against loss by
fire and such
hazards as are covered under a standard extended coverage
endorsement, in an
amount which is not less than the lesser of 100% of the insurable
value of the
Mortgaged Property and the outstanding principal balance of the
Mortgage Loan,
but in no event less than the minimum amount necessary to fully
compensate for
any damage or loss on a replacement cost basis; if the Mortgaged
Property is a
condominium unit, it is included under the coverage afforded by a
blanket policy
for the project; if upon origination of the Mortgage Loan, the
improvements on
the Mortgaged Property were in an area identified in the Federal
Register by the
Federal Emergency Management Agency as having special flood
hazards, a flood
insurance policy meeting the requirements of the current guidelines
of the
Federal Insurance Administration is in effect with a generally
acceptable
insurance carrier, in an amount representing coverage not less than
the least of
(A) the outstanding principal balance of the Mortgage Loan, (B) the
full
insurable value of the Mortgaged Property and (C) the maximum
amount of
insurance which was available under the National Flood Insurance
Act of 1968, as
amended; and each Mortgage obligates the Mortgagor thereunder to
maintain all
such insurance at the Mortgagor's cost and expense;
(w) To the best of the Depositor's knowledge, no Mortgagor is a
debtor in any state or federal bankruptcy or insolvency
proceeding;
(x) If the Mortgage Loan is secured by a long-term residential
lease, (1) the lessor under the lease holds a fee simple interest
in the land;
(2) the terms of such lease expressly permit the mortgaging of the
leasehold
estate, the assignment of the lease without the lessor's consent
and the
acquisition by the holder of the Mortgage of the rights of the
lessee upon
foreclosure or assignment in lieu of foreclosure or provide the
holder of the
Mortgage with substantially similar protections; (3) the terms of
such lease do
not (a) allow the termination thereof upon the lessee's default
without the
holder of the Mortgage being entitled to receive written notice of,
and
opportunity to cure, such default, (b) allow the termination of the
lease in the
event of damage or destruction as long as the Mortgage is in
existence, (c)
prohibit the holder of the Mortgage from being insured (or
receiving proceeds of
insurance) under the hazard insurance policy or policies relating
to the
Mortgaged Property or (d) permit any increase in rent other than
pre-established
increases set forth in the lease; (4) the original term of such
lease is not
less than 15 years; (5) the term of such lease does not terminate
earlier than
five years after the maturity date of the Mortgage Note; and (6)
the Mortgaged
Property is located in a jurisdiction in which the use of leasehold
estates in
transferring ownership in residential properties is a widely
accepted practice;
(y) None of the Mortgage Loans are classified as "high cost"
Mortgage Loans under Section 32 of the Home Ownership and Equity
Protection Act
of 1994 as amended or any comparable state law;
(z) With respect to each Mortgage Loan that has a Prepayment
Penalty, each such Prepayment Penalty shall be enforceable, and
each Prepayment
Penalty shall be permitted pursuant to federal, state and local
law. Each such
Prepayment Penalty is in an amount less than or equal to the
maximum amount
permitted under applicable law. Each such Prepayment Penalty
actually charged to
the related borrower is in accordance with the Prepayment Penalty
matrices set
forth in Exhibit R;
(aa) Each Mortgage Loan is a "qualified mortgage" within the
meaning
of Section 860G of the Code and Treas. Reg. ss.1.860G-2;
(bb) No Mortgage Loan is a "high cost" loan as defined under
any
federal, state or local law applicable to such Mortgage Loan at the
time of its
origination;
(cc) No Mortgage Loan is serviced by the Trustee or an affiliate
of
the Trustee; and
(dd) In addition to the foregoing representations and
warranties
made in subparagraphs (a) through (cc) above, the Depositor further
represents
and warrants upon delivery of the Group I Mortgage Loans, as to
each, that:
(i) No mortgage loan is covered by the Home Ownership and
Equity
Protection
Act of 1994;
(ii) With respect to each Group I Mortgage Loan, none of the
proceeds
of such Mortgage Loan were used to finance single-premium
credit
life
insurance policies;
(iii) With respect to each Group I Mortgage Loan, the Servicer
has
furnished
accurate and complete information on the related borrower
credit
files to
Equifax, Experian and Trans Union Credit Information Company,
in
accordance
with the Fair Credit Reporting Act and its implementing
regulations;
(iv) The unpaid principal balance of each Group I Mortgage Loan
does
not exceed
the applicable maximum original loan amount limitations with
respect to
first lien one- to four-family residential mortgage loans as
set forth
in the Freddie Mac Selling Guide;
(v) With respect to each Group I Mortgage Loan that has a
Prepayment
Penalty,
no such Prepayment Penalty may be imposed for a term in excess
of
five (5)
years with respect to Mortgage Loans originated prior to
October
1, 2002
and three (3) years with respect to Mortgage Loans originated
on
or after
October 1, 2002;
(vi) No Group I Mortgage Loan is a "high-cost," "high-cost
home,"
"covered"
(excluding home loans defined as "covered home loans" pursuant
to clause
(1) of the definition of that term in the New Jersey Home
Ownership
Security Act of 2002), "high-risk home" or "predatory" loan
under any
applicable federal, state or local predatory or abusive lending
law;
and
(vii) With respect to any Group I Mortgage Loan originated on
or
after
August 1, 2004, neither the related Mortgage nor the related
Mortgage
Note requires the borrower to submit to arbitration to resolve
any
dispute arising out of or relating in any way to the mortgage
loan
transaction.
Notwithstanding the foregoing, no representations or warranties
are
made by the Depositor as to the environmental condition of any
Mortgaged
Property; the absence, presence or effect of hazardous wastes or
hazardous
substances on any Mortgaged Property; any casualty resulting from
the presence
or effect of hazardous wastes or hazardous substances on, near or
emanating from
any Mortgaged Property; the impact on Certificateholders of any
environmental
condition or presence of any hazardous substance on or near any
Mortgaged
Property; or the compliance of any Mortgaged Property with any
environmental
laws, nor is any agent, person or entity otherwise affiliated with
the Depositor
authorized or able to make any such representation, warranty or
assumption of
liability relative to any Mortgaged Property. In addition, no
representations or
warranties are made by the Depositor with respect to the absence or
effect of
fraud in the origination of any Mortgage Loan.
It is understood and agreed that the representations and
warranties
set forth in this Section 2.04 shall survive delivery of the
respective Owner
Mortgage Files (and, if applicable, Retained Mortgage Files) to the
Custodian
and shall inure to the benefit of the Trustee notwithstanding any
restrictive or
qualified endorsement or assignment.
Section 2.05 Representations, Warranties and Covenants of the
Servicer. The Servicer hereby represents, warrants and covenants to
the Trustee,
for the benefit of each of the Trustee and the Certificateholders
and to the
Depositor and the Securities Administrator that as of the Closing
Date or as of
such date specifically provided herein:
(i) The Servicer is a national banking association duly
chartered
and
validly existing in good standing under the laws of the United
States
and has
all licenses necessary to carry on its business as now being
conducted,
except for such licenses, certificates and permits the absence
of which,
individually or in the aggregate, would not have a material
adverse
effect on the ability of the Servicer to conduct its business
as
it is
presently conducted, and is licensed, qualified and in good
standing
in the
states where the Mortgaged Property is located if the laws of
such
state
require licensing or qualification in order to conduct business
of
the type
conducted by the Servicer or to ensure the enforceability or
validity
of each Mortgage Loan; the Servicer has the power and authority
to execute
and deliver this Agreement and to perform in accordance
herewith;
the execution, delivery and performance of this Agreement
(including
all instruments of transfer to be delivered pursuant to this
Agreement)
by the Servicer and the consummation of the transactions
contemplated hereby have been duly and validly authorized; and
all
requisite
corporate action has been taken by the Servicer to make this
Agreement
valid and binding upon the Servicer in accordance with its
terms;
(ii) The consummation of the transactions contemplated by this
Agreement
are in the ordinary course of business of the Servicer and will
not result
in the breach of any term or provision of the articles of
incorporation or by-laws of the Servicer or result in the breach of
any
term or
provision of, or conflict with or constitute a default under or
result in
the acceleration of any obligation under, any agreement,
indenture
or loan or credit agreement or other instrument to which the
Servicer
or its property is subject, or result in the violation of any
law, rule,
regulation, order, judgment or decree to which the Servicer or
its
property is subject;
(iii) The Servicer is an approved seller/servicer of
conventional
residential mortgage loans for Fannie Mae or Freddie Mac, with
the
facilities, procedures, and experienced personnel necessary for the
sound
servicing
of mortgage loans of the same type as the Mortgage Loans. The
Servicer
is a HUD approved mortgagee pursuant to Section 203 of the
National
Housing Act and is in good standing to sell mortgage loans to
and
service
mortgage loans for Fannie Mae or Freddie Mac, and no event has
occurred,
including but not limited to a change in insurance coverage,
which would make
the Servicer unable to comply with Fannie Mae or Freddie
Mac
eligibility requirements or which would require notification to
either
Fannie Mae
or Freddie Mac;
(iv) This Agreement, and all documents and instruments
contemplated
hereby
which are executed and delivered by the Servicer, constitute
and
will
constitute valid, legal and binding obligations of the
Servicer,
enforceable in accordance with their respective terms, except as
the
enforcement thereof may be limited by applicable bankruptcy,
insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement
of
creditors' rights generally (whether considered in a proceeding at
law
or in
equity);
(v)
The Servicer does not believe, nor does it have any reason or
cause to
believe, that it cannot perform each and every covenant
contained
in this
Agreement;
(vi) There is no action, suit, proceeding or investigation
pending
or, to its
knowledge, threatened against the Servicer that, either
individually or in the aggregate, may result in any material
adverse
change in
the business, operations, financial condition, properties or
assets of
the Servicer, or in any material impairment of the right or
ability of
the Servicer to carry on its business substantially as now
conducted,
or in any material liability on the part of the Servicer, or
that would
draw into question the validity or enforceability of this
Agreement
or of any action taken or to be taken in connection with the
obligations of the Servicer contemplated herein, or that would be
likely
to impair
materially the ability of the Servicer to perform under the
terms of this
Agreement;
(vii) No consent, approval or order of any court or
governmental
agency or
body is required for the execution, delivery and performance by
the
Servicer of or compliance by the Servicer with this Agreement or
the
consummation of the transactions contemplated by this Agreement,
except
for such
consents, approvals, authorizations and orders, if any, that
have
been
obtained;
(viii) No information in this Agreement provided by the Servicer
nor
any
information, certificate of an officer, statement furnished in
writing
or report
delivered to the Trustee or the Securities Administrator by the
Servicer
in connection with the transactions contemplated hereby
contains
or will contain
any untrue statement of a material fact or omits or will
omit to
state a material fact necessary in order to make the statements
contained
therein, in light of the circumstances under which they were
made, not
misleading;
(ix) The Servicer has fully furnished, and shall continue to
fully
furnish
for so long as it is servicing the Mortgage Loans hereunder, in
accordance
with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information on the Mortgagor
credit
files to
Equifax, Experian and Trans Union Credit Information Company on
a
monthly
basis;
(x) Except as otherwise disclosed in the Prospectus, no legal
or
governmental proceedings are pending (or known to be contemplated)
against
the
Servicer that would be material to Certificateholders;
(xi) Except as otherwise disclosed in the Prospectus, the
Servicer
is not
aware and has not received notice that any default, early
amortization or other performance triggering event has occurred as
to any
other
securitization due to any act or failure to act of the Servicer
under such
securitization;
(xii) Except as otherwise disclosed in the Prospectus, the
Servicer
has not
been terminated as servicer in a residential mortgage loan
securitization, either due to a servicing default or to application
of a
servicing
performance test or trigger;
(xiii) Except as otherwise disclosed in the Prospectus, no
material
noncompliance with the applicable servicing criteria with respect
to other
securitizations of residential mortgage loans involving the
Servicer as a
servicer
has been disclosed or reported by the Servicer within the past
three (3)
years;
(xiv) Except as otherwise disclosed in the Prospectus, no
material
changes to
the Servicer's policies or procedures with respect to the
servicing
function it will perform under this Agreement for mortgage
loans
of a type
similar to the Mortgage Loans have occurred during the
three-year
period immediately preceding the date of this Agreement;
(xv) Except as otherwise disclosed in the Prospectus, there is
no
material
risk that the Servicer's financial condition could affect one
or
more
aspects of the performance by the Servicer of its servicing
obligations under this Agreement in a manner that could have a
material
impact on
the performance of the Mortgage Loans or the Certificates; and
(xvi) Except as disclosed in the Prospectus, there are no
affiliations, relationships or transactions relating to the
Servicer and
any party
identified in Item 1119 of Regulation AB of the type described
therein.
It is understood and agreed that the representations, warranties
and
covenants set forth in this Section 2.05 shall survive delivery of
the Mortgage
Files to the Custodian and shall inure to the benefit of the
Trustee, the
Depositor, the Securities Administrator and the Certificateholders.
Upon
discovery by any of the Depositor, the Servicer, the Securities
Administrator or
the Trustee of a breach of any of the foregoing representations,
warranties and
covenants which materially and adversely affects the value of any
Mortgage Loan,
Prepayment Penalty or the interests therein of the
Certificateholders, the party
discovering such breach shall give prompt written notice (but in no
event later
than two Business Days following such discovery) to the other
parties hereto.
Upon discovery by any of the Depositor, the Servicer, the
Securities
Administrator or the Trustee of a breach of any of the
representations and
warranties set forth in this Section 2.05, the party discovering
such breach
shall give prompt written notice, which shall not exceed two days,
to the other
parties. The Securities Administrator shall consult with the
Depositor to
determine if any such breach is material and any breach determined
by the
Depositor to be material shall be included by the Securities
Administrator on
the next Distribution Date Statement prepared pursuant to Section
4.06.
Section 2.06 Representations and Warranties of the Depositor.
The
Depositor represents and warrants to the Trust and the Trustee on
behalf of the
Certificateholders and to the Servicer and Securities Administrator
as follows:
(i) This agreement constitutes a legal, valid and binding
obligation
of the
Depositor, enforceable against the Depositor in accordance with
its
terms,
except as enforceability may be limited by applicable
bankruptcy,
insolvency, reorganization, moratorium or other similar laws now
or
hereafter
in effect affecting the enforcement of creditors' rights in
general
and except as such enforceability may be limited by general
principles
of equity (whether considered in a proceeding at law or in
equity);
(ii) Immediately prior to the sale and assignment by the
Depositor
to the
Trustee on behalf of the Trust of each Mortgage Loan, the
Depositor
had good
and marketable title to each Mortgage Loan (insofar as such
title
was
conveyed to it by the Seller) subject to no prior lien, claim,
participation interest, mortgage, security interest, pledge, charge
or
other
encumbrance or other interest of any nature;
(iii) As of the Closing Date, the Depositor has transferred all
right,
title interest in the Mortgage Loans to the Trustee on behalf
of
the
Trust;
(iv) The Depositor has not transferred the Mortgage Loans to
the
Trustee on
behalf of the Trust with any intent to hinder, delay or defraud
any of its
creditors;
(v) The Depositor has been duly incorporated and is validly
existing
as a
corporation in good standing under the laws of the State of
Delaware,
with full
corporate power and authority to own its assets and conduct its
business
as presently being conducted;
(vi) The Depositor is not in violation of its certificate of
incorporation or by-laws or in default in the performance or
observance of
any
material obligation, agreement, covenant or condition contained in
any
contract,
indenture, mortgage, loan agreement, note, lease or other
instrument
to which the Depositor is a party or by which it or its
properties
may be bound, which default might result in any material
adverse
changes in the financial condition, earnings, affairs or
business
of the
Depositor or which might materially and adversely affect the
properties
or assets, taken as a whole, of the Depositor;
(vii) The execution, delivery and performance of this Agreement
by
the
Depositor, and the consummation of the transactions
contemplated
thereby,
do not and will not result in a material breach or violation of
any of the
terms or provisions of, or, to the knowledge of the Depositor,
constitute
a default under, any indenture, mortgage, deed of trust, loan
agreement
or other agreement or instrument to which the Depositor is a
party or
by which the Depositor is bound or to which any of the property
or assets
of the Depositor is subject, nor will such actions result in
any
violation
of the provisions of the certificate of incorporation or
by-laws
of the
Depositor or, to the best of the Depositor's knowledge without
independent investigation, any statute or any order, rule or
regulation of
any court
or governmental agency or body having jurisdiction over the
Depositor
or any of its properties or assets (except for such conflicts,
breaches,
violations and defaults as would not have a material adverse
effect on
the ability of the Depositor to perform its obligations under
this
Agreement);
(viii) To the best of the Depositor's knowledge without any
independent investigation, no consent, approval, authorization,
order,
registration or
qualification of or with any court or governmental agency
or body of
the United States or any other jurisdiction is required for the
issuance
of the Certificates, or the consummation by the Depositor of
the
other
transactions contemplated by this Agreement, except such
consents,
approvals,
authorizations, registrations or qualifications as (a) may be
required
under State securities or blue sky laws, (b) have been
previously
obtained
or (c) the failure of which to obtain would not have a material
adverse
effect on the performance by the Depositor of its obligations
under, or
the validity or enforceability of, this Agreement; and
(ix) There are no actions, proceedings or investigations
pending
before or,
to the Depositor's knowledge, threatened by any court,
administrative agency or other tribunal to which the Depositor is a
party
or of
which any of its properties is the subject: (a) which if
determined
adversely
to the Depositor would have a material adverse effect on the
business,
results of operations or financial condition of the Depositor;
(b)
asserting the invalidity of this Agreement or the Certificates;
(c)
seeking to
prevent the issuance of the Certificates or the consummation by
the
Depositor of any of the transactions contemplated by this
Agreement,
as the
case may be; or (d) which might materially and adversely affect
the
performance by the Depositor of its obligations under, or the
validity or
enforceability of, this Agreement.
Section 2.07 Issuance of Certificates and the Uncertificated
Regular
Interests. The Trustee acknowledges the assignment to it of the
Mortgage Loans
and the delivery to the Custodian on its behalf of the Mortgage
Files, subject
to the provisions of Sections 2.01 and 2.02, and the Trustee
acknowledges the
assignment to it of all other assets included in the Trust Fund,
receipt of
which is hereby acknowledged. Concurrently with such assignment and
delivery and
in exchange therefor, the Securities Administrator, pursuant to the
Written
Order to Authenticate executed by an officer of the Depositor, has
executed, and
the Certificate Registrar has authenticated and delivered to or
upon the order
of the Depositor, the Class A Certificates and Class M Certificates
(other than
the Class M-12 and Class M-13 Certificates) in minimum dollar
denominations of
$[ ] and integral dollar multiples of $[ ] in excess thereof and
the Class M-12
and Class M-13 Certificates in minimum denominations of $[ ] and
integral
multiples of $[ ] in excess thereof. The Class CE and Class P
Certificates are
issuable only in minimum Percentage Interests of 10%. Each Residual
Certificate
is issuable only as a single certificate. The Trustee acknowledges
the issuance
of the uncertificated REMIC 1 Regular Interests and declares that
it hold such
regular interests as assets of REMIC 2. The Trustee acknowledges
the issuance of
the Class CE Uncertificated Interest and declares that it holds
such regular
interest as the asset of REMIC A. The Trustee acknowledges that the
obligation
of the Class CE Certificates to pay Cap Carryover Amounts, and
declares that it
hold the same as assets of the Grantor Trust on behalf of the
Holders of the
Class AI-1A, Class AI-1B, Class AII-1, Class AII-2, Class AII-3,
Class M-1,
Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7,
Class M-8,
Class M-9, Class M-10, Class M-11, Class M-12 and Class M-13
Certificates,
respectively. In addition to the assets described in the preceding
sentence, the
assets of the Grantor Trust shall also include (i) Prepayment
Penalties, any
Servicer Prepayment Penalty Payment Amounts, any Originator
Prepayment Penalty
Payment Amounts and the beneficial interest of the Class P
Certificates with
respect thereto and (ii) the Yield Maintenance Agreement, the
Reserve Account
and the beneficial interest of the Class CE Certificates with
respect thereto,
subject to the obligation to pay Cap Carryover Amounts. The
interests evidenced
by the Certificates constitute the entire beneficial ownership
interest in the
Trust Fund.
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE TRUST FUND
Section 3.01 Servicer to Act as Servicer. The Servicer, as
independent contract servicer, shall service and administer the
Mortgage Loans
in accordance with this Agreement and the normal and usual
standards of practice
of sub-prime mortgage servicers servicing similar mortgage loans in
the same
respective jurisdictions as the Mortgaged Properties, and shall
have full power
and authority, acting alone, to do or cause to be done any and all
things in
connection with such servicing and administration which the
Servicer may deem
necessary or desirable and consistent with the terms of this
Agreement (the
"Servicing Standards").
Consistent with the terms of this Agreement, the Servicer may
waive,
modify or vary any term of any Mortgage Loan or consent to the
postponement of
strict compliance with any such term or in any manner grant
indulgence to any
Mortgagor if in the Servicer's reasonable determination such
waiver,
modification, postponement or indulgence is not materially adverse
to the
Certificateholders; provided, however, that the Servicer shall not
make future
advances and (unless the Mortgagor is in default with respect to
the Mortgage
Loan or such default is, in the judgment of the Servicer,
reasonably
foreseeable) the Servicer shall not permit any modification with
respect to any
Mortgage Loan that would (i) change the Mortgage Interest Rate,
defer or forgive
the payment thereof of any principal or interest payments, reduce
the
outstanding principal amount (except for actual payments of
principal) or extend
the final maturity date with respect to such Mortgage Loan, (ii)
affect
adversely the status of any REMIC created hereunder as a REMIC or
(iii) cause
any REMIC created hereunder to be subject to a tax on "prohibited
transactions"
or "contributions" pursuant to the REMIC Provisions.
Notwithstanding the
foregoing, the Servicer shall not permit any modification with
respect to any
Mortgage Loan that would both (x) effect an exchange or reissuance
of such
Mortgage Loan under Section 1.860G-2(b) of the Treasury Regulations
and (y)
cause any REMIC constituting part of the Trust Fund to fail to
qualify as a
REMIC under the Code or the imposition of any tax on "prohibited
transactions"
or "contributions" after the Startup Day under the REMIC
Provisions. Without
limiting the generality of the foregoing, the Servicer shall
continue, and is
hereby authorized and empowered to execute and deliver on behalf of
itself and
the Trustee, all instruments of satisfaction or cancellation, or of
partial or
full release, discharge and all other comparable instruments, with
respect to
the Mortgage Loans and with respect to the Mortgaged Properties.
The Servicer
shall make all required Servicing Advances and shall service and
administer the
Mortgage Loans in accordance with Applicable Regulations, and shall
provide to
the Mortgagor any reports required to be provided to them thereby.
By the
execution of this Agreement, the Trustee hereby grants to the
Servicer, a power
of attorney to enable the Servicer to carry out its servicing and
administrative
duties hereunder; provided, however, that the Trustee shall not be
held liable
for any misuse of any such power of attorney by the Servicer.
Notwithstanding
anything contained herein to the contrary, the Servicer shall not,
without the
Trustee's written consent: (i) initiate any action, suit or
proceeding solely
under the Trustee's name without indicating the Servicer's
representative
capacity; or (ii) take any action with the intent to cause, and
that actually
causes, the Trustee to be registered to do business in any
state.
In servicing and administering the Mortgage Loans, the Servicer
shall employ procedures including collection procedures and
exercise the same
care that it customarily employs and exercises in servicing and
administering
mortgage loans for its own account giving due consideration to
accepted mortgage
servicing practices of prudent lending institutions and the
Certificateholders'
reliance on the Servicer.
Notwithstanding anything in this Agreement to the contrary, in
the
event of a voluntary Principal Prepayment in full of a Mortgage
Loan, the
Servicer may not waive any Prepayment Penalty or portion thereof
required by the
terms of the related Mortgage Note unless (i)(a) the Servicer
determines that
such waiver is standard and customary in servicing similar mortgage
loans, (b)
such waiver relates to a default or a reasonably foreseeable
default and (c)
would, in the reasonable judgment of the Servicer, maximize
recovery of
Liquidation Proceeds for such Mortgage Loan, taking into account
the value of
such Prepayment Penalty, or (ii) the enforceability thereof is
limited (1) by
bankruptcy, insolvency, moratorium, receivership, or other similar
law relating
to creditors' rights generally or (2) due to acceleration in
connection with a
foreclosure or other involuntary payment. If the Servicer has
waived or does not
collect all or a portion of a Prepayment Penalty relating to a
voluntary
Principal Prepayment in full due to any action or omission of the
Servicer,
other than as provided above, the Servicer shall, on the date on
which the
Principal Prepayment in full is remitted to the Securities
Administrator,
deliver to the Securities Administrator the Servicer Prepayment
Penalty Amount
with respect to such Mortgage Loan for distribution in accordance
with the terms
of this Agreement.
In the event that a Prepayment Penalty due with respect to any
Mortgage Loan is not timely received by the Servicer, the Servicer
shall use
commercially reasonable efforts to determine whether the Originator
is obligated
to pay a related Originator Prepayment Penalty Payment Amount, and
if the
Servicer determines that a Originator Prepayment Penalty Payment
Amount is due,
the Servicer shall promptly notify the Originator, and the Servicer
shall
enforce the Originator's obligations as set forth in the Mortgage
Loan Purchase
Agreement to pay any such Originator Prepayment Penalty Payment
Amounts and, to
the extent that such amounts are received by the Servicer, shall
cause such
amounts to be deposited into the Collection Account within one
Business Day of
receipt.
Section 3.02 Collection of Mortgage Loan Payments. Continuously
from
the date hereof until the principal and interest on all Mortgage
Loans are paid
in full or as long as the Mortgage Loan remains subject to this
Agreement, the
Servicer will diligently collect all payments due under each
Mortgage Loan when
the same shall become due and payable and shall, to the extent such
procedures
shall be consistent with the Servicing Standards and Applicable
Regulations,
follow such collection procedures as it follows with respect to
mortgage loans
comparable to the Mortgage Loans and held for its own account.
Further, where
applicable, the Servicer will take special care in ascertaining and
estimating
annual Escrow Payments that, as provided in the Escrow Agreement,
will become
due and payable to that end that the installments payable by the
Mortgagors will
be sufficient to pay such charges as and when they become due and
payable.
Section 3.03 Realization Upon Defaulted Mortgage Loans. In the
event
that any payment due under any Mortgage Loan is not paid when the
same becomes
due and payable, or in the event the Mortgagor fails to perform any
other
covenant or obligation under the Mortgage Loan and such failure
continues beyond
any applicable grace period, the Servicer shall take such action as
it shall
deem to be in the best interest of the Certificateholders.
In connection with a foreclosure or other conversion, the
Servicer
shall exercise such rights and powers vested in it hereunder and
use the same
degree of care and skill in its exercise as it would exercise or
use under the
circumstances in the conduct of its own affairs and consistent with
Applicable
Regulations and the Servicing Standards, including, without
limitation,
advancing funds for the payment of taxes and insurance premiums
with respect to
first lien Mortgage Loans.
Notwithstanding the foregoing provisions of this Section 3.03,
with
respect to any Mortgage Loan as to which the Servicer has received
actual notice
of, or has actual knowledge of, the presence of any toxic or
hazardous substance
on the related Mortgaged Property, the Servicer shall not either
(i) obtain
title to such Mortgaged Property as a result of or in lieu of
foreclosure or
otherwise, or (ii) otherwise acquire possession of, or take any
other action
with respect to, such Mortgaged Property if, as a result of any
such action, the
Trust would be considered to hold title to, to be a
mortgagee-in-possession of,
or to be an owner or operator of such Mortgaged Property within the
meaning of
the Comprehensive Environmental Response, Compensation and
Liability Act of
1980, as amended from time to time, or any comparable law, unless
the Servicer
has also previously determined, based on its reasonable judgment
and a report
prepared by a Person who regularly conducts environmental audits
using customary
industry standards, stating that:
A. such Mortgaged Property is in compliance with applicable
environmental laws or, if not, that it would be in the best
economic interest of
the Certificateholders to take such actions as are necessary to
bring the
Mortgaged Property into compliance therewith; and
B. there are no circumstances present at such Mortgaged
Property
relating to the use, management or disposal of any hazardous
substances,
hazardous materials, hazardous wastes, or petroleum-based materials
for which
investigation, testing, monitoring, containment, clean-up or
remediation could
be required under any federal, state or local law or regulation, or
that if any
such materials are present for which such action could be required,
that it
would be in the best economic interest of the Certificateholders to
take such
actions with respect to the affected Mortgaged Property.
Notwithstanding the foregoing, if such environmental audit
reveals,
or if the Servicer has actual knowledge or notice, that such
Mortgaged Property
contains such wastes or substances, the Servicer shall not
foreclose or accept a
deed in lieu of foreclosure.
The cost of the environmental audit report contemplated by this
Section 3.03 shall be advanced by the Servicer, subject to the
Servicer's right
to be reimbursed therefor from the Collection Account as provided
in Section
3.05(ii).
If the Servicer determines, as described above, that it is in
the
best economic interest of the Certificateholders to take such
actions as are
necessary to bring any such Mortgaged Property into compliance with
applicable
environmental laws, or to take such action with respect to the
containment,
clean-up or remediation of hazardous substances, hazardous
materials, hazardous
wastes, or petroleum-based materials affecting any such Mortgaged
Property, then
the Servicer shall take such action as it deems to be in the best
economic
interest of the Certificateholders. The cost of any such
compliance,
containment, cleanup or remediation shall be advanced by the
Servicer, subject
to the Servicer's right to be reimbursed therefor from the
Collection Account as
provided in Section 3.05(ii).
Section 3.04 Collection Account, Distribution Account and
Reserve
Account. (a) The Servicer shall segregate and hold all funds
collected and
received pursuant to each Mortgage Loan separate and apart from any
of its own
funds and general assets and shall establish and maintain one or
more accounts
(such account or accounts, the "Collection Account"). Each
Collection Account
shall be an Eligible Account.
The Servicer shall deposit in the Collection Account within
three
Business Days of receipt, and retain therein, the following
payments and
collections received or made by it after the applicable Cut-off
Date with
respect to the Mortgage Loans, without duplication:
(i) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans;
(ii) all payments on account of interest on the Mortgage Loans
adjusted
to the Mortgage Interest Rate less the Servicing Fee Rate;
(iii) all Net Liquidation Proceeds and Subsequent Recoveries;
(iv) all Insurance Proceeds including amounts required to be
deposited
pursuant to Section 3.10, other than proceeds to be held in the
Escrow
Account and applied to the restoration or repair of the
Mortgaged
Property
or released to the Mortgagor in accordance with the Servicer's
normal
servicing procedures, the loan documents or applicable law;
(v) all Condemnation Proceeds affecting any Mortgaged Property
which
are not
released to the Mortgagor in accordance with the Servicer's
normal
servicing
procedures, the loan documents or applicable law;
(vi) any amounts required to be deposited by the Servicer in
connection
with any REO Property pursuant to Section 3.13;
(vii) all Prepayment Penalties collected by the Servicer in
connection
with the voluntary Principal Prepayment in full of any of the
Mortgage
Loans, all Originator Prepayment Penalty Payment Amounts paid
by
the
Originator and all Servicer Prepayment Penalty Payment Amounts
required
to be paid by the Servicer pursuant to Section 3.01 in
connection
with any
such Principal Prepayment; and
(viii) all amounts required to be deposited by the Servicer
pursuant
to Section
2.03.
Any interest paid on funds deposited in the Collection Account,
subject to Section 3.23, shall accrue to the benefit of the
Servicer and the
Servicer shall be entitled to retain and withdraw such interest
from the
Collection Account pursuant to Section 3.05(v). The foregoing
requirements for
deposit from the Collection Account shall be exclusive, it being
understood and
agreed that, without limiting the generality of the foregoing,
payments in the
nature of late payment charges, bad check fees, prepayment
penalties that are
not Prepayment Penalties, Originator Prepayment Penalty Payment
Amounts or
Servicer Prepayment Penalty Payment Amounts, assumption fees and
other similar
fees need not be deposited by the Servicer in the Collection
Account. Amounts
deposited into the Collection Account in error may be withdrawn at
any time.
(b) On behalf of the Trust Fund, the Securities Administrator
shall
establish and maintain one or more accounts (such account or
accounts, the
"Distribution Account"), on behalf of the Trustee, held in trust
for the benefit
of the Certificateholders. On behalf of the Trust Fund, the
Servicer shall
deliver (or cause the Originator to deliver in the case of clause
(iii) below)
to the Securities Administrator in immediately available funds for
deposit in
the Distribution Account by 1:00 p.m. New York City time on the
Servicer
Remittance Date, (i) that portion of the Available Funds
(calculated without
regard to the references in the definition thereof to amounts that
may be
deposited to the Distribution Account from a different source as
provided
herein) then on deposit in the Collection Account, (ii) the amount
of all
Prepayment Penalties collected by the Servicer in connection with
the voluntary
Principal Prepayment in full of any of the Mortgage Loans then on
deposit in the
Collection Account (other than any such Prepayment Penalties
received after the
related Prepayment Period), (iii) any Originator Prepayment Penalty
Payment
Amount or Servicer Prepayment Penalty Payment Amount that became
due during the
related Prepayment Period and (iv) amounts reimbursable or payable
to the
Trustee pursuant to Section 7.01 and Section 8.05 and amounts
reimbursable or
payable to the Securities Administrator pursuant to Section 8.05 or
Section
9.01(c). These amounts may be sent via a single combined wire
transfer. Except
as otherwise provided in Section 3.04(f), amounts in the
Distribution Account
shall be deemed to be held on behalf of the related REMICs in
accordance with
the REMIC distributions set forth in Section 4.08. The Securities
Administrator
may, from time to time, withdraw from the Distribution Account for
the following
purposes:
(i) to pay to itself and to the Trustee any amounts owed to
itself
and the
Trustee pursuant to Section 8.05, any amounts owed to itself
pursuant
to Section 9.01(c) and any amounts owed to the Trustee pursuant
to Section
7.01;
(ii) to pay to itself as compensation any interest earned on
funds
in the
Distribution Account (all such interest to be withdrawn monthly
on
each
Distribution Date); and
(iii) to clear and terminate the Distribution Account upon the
termination of this Agreement.
(c) Funds in the Collection Account and the Distribution Account
may
be invested in Permitted Investments in accordance with the
provisions set forth
in Section 3.23. The Servicer shall give notice to the Securities
Administrator
(and the Securities Administrator shall give such notice to the
Trustee) of the
location of the Collection Account maintained by it when
established upon
request and prior to any change thereof. The Securities
Administrator shall give
notice to the Servicer, the Trustee and the Depositor of the
location of the
Distribution Account when established and prior to any change
thereof.
(d) In the event the Servicer shall deliver to the Securities
Administrator for deposit in the Distribution Account any amount
not required to
be deposited therein, it may at any time request that the
Securities
Administrator withdraw such amount from the Distribution Account
and remit to
the Servicer any such amount, any provision herein to the
contrary
notwithstanding. In addition, the Servicer shall deliver to the
Securities
Administrator from time to time for deposit, and the Securities
Administrator
shall so deposit, in the Distribution Account in respect of REMIC
1:
(i) any Advances, as required pursuant to Section 4.07;
(ii) any Stayed Funds, as soon as permitted by the federal
bankruptcy
court having jurisdiction in such matters;
(iii) any Prepayment Penalties or amounts in connection with
the
waiver of
such Prepayment Penalties, in each case required to be
deposited
pursuant
to Section 3.01;
(iv) any amounts required to be deposited in the Distribution
Account
pursuant to Sections 2.03, 3.04, 3.16, 3.23 or 4.07; and
(v) any amounts required to be deposited by the Servicer pursuant
to
Section
3.11 in connection with the deductible clause in any blanket
hazard
insurance policy, such deposit being made from the Servicer's
own
funds,
without reimbursement therefor.
(e) Promptly upon receipt of any Stayed Funds, whether from the
Servicer, a trustee in bankruptcy, or federal bankruptcy court or
other source,
the Securities Administrator shall, unless such funds have been
received from
the Servicer, notify the Servicer of such receipt and deposit such
funds in the
Distribution Account, subject to withdrawal thereof as permitted
hereunder. In
addition, the Securities Administrator shall deposit in the
Distribution Account
any amounts required to be deposited pursuant to Section 3.23(b) in
connection
with losses realized on Permitted Investments with respect to funds
held in the
Distribution Account.
(f) Any Prepayment Penalties, Originator Prepayment Penalty
Payment
Amounts and Servicer Prepayment Penalty Payment Amounts deposited
pursuant to
Section 3.04(a)(vii) shall not be assets of any REMIC created
hereunder, but
shall be considered assets of the Grantor Trust held by the
Securities
Administrator, on behalf of the Trustee, for the benefit of the
Class P
Certificateholders. In addition, any Cap Carryover Amounts that are
paid with
respect to the Class A or Class M Certificates will be treated as
first having
been distributed with respect to the Class CE Certificates and then
having been
paid outside of the REMICs to the Class A or Class M
Certificateholders.
(g) The Securities Administrator shall establish and maintain
the
Reserve Account, held in trust for the benefit of the Holders of
the Class M-1,
Class M-2, Class M-3, Class M-4 and Class M-5, Class M-6, Class
M-7, Class M-8,
Class M-9, Class M-9, Class M-10, Class M-11, Class M-12 and Class
M-13
Certificates. The Securities Administrator shall deposit in the
Reserve Account
on the date received by it, any Yield Maintenance Agreement Payment
received
from the Yield Maintenance Agreement Provider for the related
Distribution Date.
On each Distribution Date, the Securities Administrator shall
withdraw from the
Reserve Account any Yield Maintenance Agreement Payment on deposit
and apply it
in the following order of priority:
(i) to the Class M Certificates, from the Reserve Account, in
each
case only
up to the Cap Amount for the related Class, any Cap Carryover
Amounts
for such Classes for such Distribution Date, distributed
concurrently, to the Class M-1, Class M-2, Class M-3, Class M-4,
Class
M-5, Class
M-6, Class M-7, Class M-8, Class M-9, Class M-10, Class M-11,
Class M-12
and Class M-13 Certificates;
(ii) to the Class M Certificates, from the Reserve Account,
without
regard to
the Cap Amount for the related Class, any remaining unpaid Cap
Carryover
Amounts for such Classes for such Distribution Date (after
distributions pursuant to clause (i) above), distributed
concurrently, to
the Class
M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6,
Class M-7,
Class M-8, Class M-9, Class M-10, Class M-11, Class M-12 and
Class M-13
Certificates, pro rata, based on their respective remaining Cap
Carryover
Amounts; and
(iii) to the Class CE Certificates, any remaining amount on
deposit
in the Reserve
Account.
(h) The Securities Administrator shall account for the Reserve
Account as an asset of a grantor trust under subpart E, part I of
subchapter J
of the Code and not an asset of any REMIC created pursuant to this
Agreement.
The beneficial owner of the Reserve Account is the Class CE
Certificateholder.
For all federal tax purposes, amounts transferred or reimbursed by
REMIC A to
the Reserve Account shall be treated as distributions by the
Securities
Administrator to the Class CE Certificateholder.
(i) Any Cap Carryover Amounts paid by the Securities
Administrator
pursuant to Section 3.04(g) to the Regular Certificates (other than
the Class CE
Certificates) shall be accounted for by the Securities
Administrator as amounts
paid first to the Class CE Certificates and then to the respective
Class or
Classes of Regular Certificates (other than the Class CE
Certificates). In
addition, the Securities Administrator shall account for the
Regular
Certificates' (other than the Class CE Certificates) rights to
receive payments
of Cap Carryover Amounts as rights in a limited recourse interest
rate cap
contract written by the Class CE Certificates in favor of the
Regular
Certificates (other than the Class CE Certificates).
(j) For federal tax return and information reporting, the right
of
the Holders of the Regular Certificates (other than the Class CE
Certificates)
to receive payments under the Yield Maintenance Agreement in
respect of the
Yield Maintenance Agreement Payments shall be assigned a value of
zero.
Section 3.05 Permitted Withdrawals From the Collection Account.
The
Servicer may, from time to time, withdraw from the Collection
Account for the
following purposes:
(i) to remit to the Securities Administrator for deposit in the
Distribution Account the amounts required to be so remitted
pursuant to
Section
3.04(b) or permitted to be so remitted pursuant to the first
sentence
of Section 3.04(d);
(ii) first, to the extent the Servicer has not previously
reimbursed
the
Trustee pursuant to Section 4.07(e), to reimburse the Trustee for
any
unreimbursed Advances made by the Trustee and second, to reimburse
itself
for any
unreimbursed Advances and Servicing Advances; the Servicer's
right
to
reimburse itself and the Trustee pursuant to this subclause (ii)
being
limited to
amounts received on the related Mortgage Loan which represent
payments
of (a) principal and/or interest respecting which any such
Advance
was made or (b) Condemnation Proceeds, Insurance Proceeds or
Liquidation Proceeds respecting which any such Servicing Advance
was made;
(iii) first, to the extent the Servicer has not previously
reimbursed the Trustee
pursuant to Section 4.07(e), to reimburse the
Trustee
for any unreimbursed Advances made by the Trustee and second to
reimburse
itself for any unreimbursed Servicing Advances, any unpaid
Servicing
Fees and for unreimbursed Advances, in each case, to the extent
that such
amounts are deemed to be Nonrecoverable Advances, and to
reimburse
itself and the Trustee for such amounts to the extent that such
amounts
are nonrecoverable from the disposition of REO Property
pursuant
to Section
3.03 or Section 3.13 hereof;
(iv) to reimburse itself for any amounts paid or expenses
incurred
pursuant
to Section 3.03 (and not otherwise previously reimbursed);
(v) to pay to itself as servicing compensation (a) any interest
earned on
funds in the Collection Account (all such interest to be
withdrawn
monthly not later than each Servicer Remittance Date) and (b)
the
Servicing Fee from that portion of any payment or recovery as
to
interest
to a particular Mortgage Loan to the extent not retained
pursuant
to Section
3.04(ii);
(vi) to reimburse itself for any amounts paid pursuant to
Section
6.03 (and
not otherwise previously reimbursed);
(vii) to reimburse the Servicer (if the Servicer is not an
Affiliate
of the
repurchasing party), the Securities Administrator or the
Trustee,
as the
case may be, for enforcement expenses reasonably incurred in
respect of
the breach or defect giving rise to the purchase obligation
under
Section 2.03 of this Agreement that were included in the
Purchase
Price of
the Mortgage Loan, including any expenses arising out of the
enforcement of the purchase obligation;
(viii) to reimburse the Depositor or the Servicer for expenses
and
costs
reimbursable to them pursuant to Section 3.24(b); and
(ix) to clear and terminate the Collection Account upon the
termination of this Agreement.
The foregoing requirements for withdrawal from the Collection
Account shall be exclusive. In the event the Servicer shall deposit
in the
Collection Account any amount not required to be deposited therein,
it may at
any time withdraw such amount from the Collection Account, any
provision herein
to the contrary notwithstanding.
Section 3.06 Establishment of Escrow Accounts; Deposits in
Escrow
Accounts. The Servicer shall segregate and hold all funds collected
and received
pursuant to each Mortgage Loan which constitute Escrow Payments
separate and
apart from any of its own funds and general assets and shall
establish and
maintain one or more Escrow Accounts, in the form of time deposit
or demand
accounts. A copy of such letter agreement shall be furnished to the
Trustee upon
request. The Escrow Account shall be an Eligible Account.
The Servicer shall deposit in the Escrow Account or Accounts
within
three Business Days of receipt, and retain therein, (i) all Escrow
Payments
collected on account of the Mortgage Loans, for the purpose of
effecting timely
payment of any such items as required under the terms of this
Agreement, and
(ii) all Insurance Proceeds which are to be applied to the
restoration or repair
of any Mortgaged Property. The Servicer shall make withdrawals
therefrom only to
effect such payments as are required under this Agreement, and for
such other
purposes as shall be set forth in, or in accordance with, Section
3.07. The
Servicer shall be entitled to retain any interest paid on funds
deposited in the
Escrow Account by the depository institution other than interest on
escrowed
funds required by law to be paid to the Mortgagor and, to the
extent required by
the related Mortgage Loan or Applicable Regulations, the Servicer
shall pay
interest on escrowed funds to the Mortgagor notwithstanding that
the Escrow
Account is non-interest bearing or that interest paid thereon is
insufficient
for such purposes.
Section 3.07 Permitted Withdrawals From Escrow Account.
Withdrawals
from the Escrow Account may be made by the Servicer (i) to effect
timely
payments of Escrow Payments, (ii) to reimburse the Servicer for any
Servicing
Advance made by the Servicer with respect to a related Mortgage
Loan but only
from amounts received on the related Mortgage Loan which represent
late payments
or Late Collections of Escrow Payments thereunder, (iii) to refund
to the
Mortgagor any funds as may be determined to be overages, (iv) for
transfer to
the Collection Account in accordance with the terms of this
Agreement, (v) for
application to restoration or repair of the Mortgaged Property,
(vi) to pay to
the Servicer, or to the Mortgagor to the extent required by the
related Mortgage
Loan or Applicable Regulations, any interest paid on the funds
deposited in the
Escrow Account, (vii) to clear and terminate the Escrow Account on
the
termination of this Agreement, or (viii) to transfer to the
Collection Account
any Insurance Proceeds. As part of its servicing duties, the
Servicer shall pay
to the Mortgagor interest on funds in the Escrow Account, to the
extent required
by the related Mortgage Loan or Applicable Regulations, and to the
extent that
interest earned on funds in the Escrow Account is insufficient,
shall pay such
interest from its own funds, without any reimbursement
therefor.
In the event the Servicer shall deposit in the Escrow Account
any
amount not required to be deposited therein, it may at any time
withdraw such
amount from the Escrow Account, any provision herein to the
contrary
notwithstanding.
Section 3.08 Payment of Taxes, Insurance and Other Charges;
Collections Thereunder; Primary Mortgage Insurance. (a) With
respect to each
Mortgage Loan subject to an Escrow Agreement, the Servicer shall
maintain
accurate records reflecting the status of taxes, which are or may
become a lien
upon the Mortgaged Property and the status of fire, flood (if
applicable) and
hazard insurance coverage and shall obtain, from time to time, all
bills for the
payment of such charges (including renewal premiums) and shall
effect payment
thereof prior to the applicable penalty or termination date and at
a time
appropriate for securing maximum discounts allowable, employing for
such purpose
deposits of the Mortgagor in the Escrow Account which shall have
been estimated
and accumulated by the Servicer in amounts sufficient for such
purposes, as
allowed under the terms of the Escrow Agreement or Applicable
Regulations. To
the extent that a Mortgage Loan is not subject to an Escrow
Agreement, the
Servicer shall determine that any such payments are made by the
Mortgagor. The
Servicer assumes full responsibility for the payment of all such
bills and shall
effect payments of all such bills irrespective of the Mortgagor's
faithful
performance in the payment of same or the making of the Escrow
Payments and
shall make Servicing Advances from its own funds to effect such
payments.
(b) For any Mortgage Loan with a Loan-to-Value Ratio at
origination
of greater than 80%, if the Mortgage Loan Schedule indicates that
such Mortgage
Loan has primary mortgage insurance, the Servicer shall maintain
coverage under
a primary mortgage insurance policy until the Loan-to-Value Ratio
on any such
Mortgage Loan is reduced to 78% or lower as a result of principal
payments on
such Mortgage Loan or based upon an appraisal of the related
Mortgaged Property
after the Closing Date. Notwithstanding anything to the contrary
herein, the
Servicer shall be responsible for the payment of all primary
mortgage insurance
premiums out of the Servicer's own funds, without any right to
reimbursement
therefor. The Servicer shall not assign its obligation under any
primary
mortgage insurance policy without the consent of each Rating Agency
and the
related primary insurance policy provider. In the event that Wells
Fargo Bank is
no longer Servicer hereunder, Wells Fargo Bank agrees to continue
to pay all
primary mortgage insurance premiums for the Mortgage Loans.
Section 3.09 Transfer of Accounts. The Servicer may transfer
the
Collection Account or the Escrow Account to a different depository
institution
from time to time. Upon such transfer, the Servicer shall deliver
to the
Securities Administrator (and the Securities Administrator shall
provide to the
Depositor and the Trustee), a certification or letter agreement, as
the case may
be, as required pursuant to Sections 3.04 and 3.06.
Section 3.10 Maintenance of Hazard Insurance. The Servicer
shall
cause to be maintained for each Mortgage Loan fire and hazard
insurance with
extended coverage as is customary in the area where the Mortgaged
Property is
located in an amount which is at least equal to the lesser of (i)
the amount
necessary to fully compensate for any damage or loss to the
improvements which
are a part of such property on a replacement cost basis or (ii) the
Principal
Balance of the Mortgage Loan, in each case in an amount not less
than such
amount as is necessary to prevent the Mortgagor and/or the
Mortgagee from
becoming a co-insurer. If the Mortgaged Property is in an area
identified in the
Federal Register by the Flood Emergency Management Agency as having
special
flood hazards and flood insurance has been made available, the
Servicer will
cause to be maintained a flood insurance policy meeting the
requirements of the
current guidelines of the Federal Insurance Administration with a
generally
acceptable insurance carrier, in an amount representing coverage
not less than
the least of (i) the Principal Balance of the Mortgage Loan, (ii)
the maximum
insurable value of the improvements securing such Mortgage Loan or
(iii) the
maximum amount of insurance which is available under the National
Flood
Insurance Act of 1968, as amended. The Servicer shall also maintain
on the REO
Property for the benefit of the Certificateholders, (x) fire and
hazard
insurance with extended coverage in an amount which is at least
equal to the
replacement cost of the improvements which are a part of such
property and (y)
to the extent required and available under the Flood Disaster
Protection Act of
1973, as amended, flood insurance in an amount as provided above.
Any amounts
collected by the Servicer under any such policies other than
amounts to be
deposited in the Escrow Account and applied to the restoration or
repair of the
Mortgaged Property or REO Property, or released to the Mortgagor in
accordance
with the Servicer's normal servicing procedures, shall be deposited
in the
Collection Account, subject to withdrawal pursuant to Section 3.05.
It is
understood and agreed that no earthquake or other additional
insurance is
required to be maintained by the Servicer or the Mortgagor or
maintained on
property acquired in respect of the Mortgage Loan, other than
pursuant to such
Applicable Regulations as shall at any time be in force and as
shall require
such additional insurance. All such policies shall be endorsed with
standard
mortgagee clauses with loss payable to the Servicer and shall
provide for at
least thirty days prior written notice of any cancellation,
reduction in the
amount of or material change in coverage to the Servicer. The
Servicer shall not
interfere with the Mortgagor's freedom of choice in selecting
either his
insurance carrier or agent, provided, however, that the Servicer
shall not
accept any such insurance policies from insurance companies unless
such
companies currently reflect a general policy rating of B:VI or
better in Best's
Key Rating Guide and are licensed to do business in the state
wherein the
property subject to the policy is located.
Section 3.11 Maintenance of Mortgage Impairment Insurance Policy.
In
the event that the Servicer shall obtain and maintain a blanket
policy issued by
an insurer that has a general policy rating of B:VI or better in
Best's Key
Rating Guide insuring against hazard losses on all of the Mortgage
Loans, then,
to the extent such policy provides coverage in an amount equal to
the amount
required pursuant to Section 3.10 and otherwise complies with all
other
requirements of Section 3.10, it shall conclusively be deemed to
have satisfied
its obligations as set forth in Section 3.10, it being understood
and agreed
that such policy may contain a deductible clause, in which case the
Servicer
shall, in the event that there shall not have been maintained on
the related
Mortgaged Property or REO Property a policy complying with Section
3.10, and
there shall have been a loss which would have been covered by such
policy,
deliver to the Securities Administrator for deposit in the
Distribution Account
the amount not otherwise payable under the blanket policy because
of such
deductible clause, which amount shall not be reimbursable to the
Servicer from
the Trust Fund. In connection with its activities as servicer of
the Mortgage
Loans, the Servicer agrees to prepare and present, on behalf of the
Trustee,
claims under any such blanket policy in a timely fashion in
accordance with the
terms of such policy. Upon request of the Securities Administrator,
the Servicer
shall cause to be delivered to the Custodian and the Securities
Administrator a
certified true copy of such policy and a statement from the insurer
thereunder
that such policy shall in no event be terminated or materially
modified without
thirty days prior written notice to the Trustee.
Section 3.12 Fidelity Bond, Errors and Omissions Insurance. The
Servicer shall maintain, at its own expense, a blanket fidelity
bond (the
"Fidelity Bond") and an errors and omissions insurance policy, with
broad
coverage with financially responsible companies on all officers,
employees or
other persons acting in any capacity with regard to the Mortgage
Loans to handle
funds, money, documents and papers relating to the Mortgage Loans.
The Fidelity
Bond and errors and omissions insurance shall be in the form of the
Mortgage
Banker's Blanket Bond and shall protect and insure the Servicer
against losses,
including forgery, theft, embezzlement, fraud, errors and omissions
and
negligent acts of such persons. Such Fidelity Bond shall also
protect and insure
the Servicer against losses in connection with the failure to
maintain any
insurance policies required pursuant to this Agreement and the
release or
satisfaction of a Mortgage Loan without having obtained payment in
full of the
indebtedness secured thereby. No provision of this Section 3.12
requiring the
Fidelity Bond and errors and omissions insurance shall diminish or
relieve the
Servicer from its duties and obligations as set forth in this
Agreement. The
minimum coverage under any such bond and insurance policy shall be
in an amount
acceptable to Fannie Mae or Freddie Mac. Upon request of the
Trustee, the
Servicer shall cause to be delivered to the Trustee a certified
true copy of the
Fidelity Bond and errors and omissions insurance policy and a
statement from the
surety and the insurer that such Fidelity Bond and errors and
omissions
insurance policy shall in no event be terminated or materially
modified without
the acquisition of comparable coverage by the Servicer.
Section 3.13 Title, Management and Disposition of REO Property.
(a)
In the event that title to a Mortgaged Property is acquired in
foreclosure or by
deed in lieu of foreclosure, the deed or certificate of sale shall
be taken in
the name of the Trustee, on behalf of the Certificateholders, or in
the event
the Trustee is not authorized or permitted to hold title to real
property in the
state where the REO Property is located, or would be adversely
affected under
the "doing business" or tax laws of such state by so holding title,
the deed or
certificate of sale shall be taken in the name of such Person or
Persons as
shall be consistent with an Opinion of Counsel obtained by the
Servicer from an
attorney duly licensed to practice law in the state where the REO
Property is
located. Any Person or Persons holding such title other than the
Trustee shall
acknowledge in writing that such title is being held as nominee for
the benefit
of the Trustee. Pursuant to the power of attorney granted in
Section 3.01, the
Servicer is hereby authorized to acquire, transfer and dispose of
any REO
Property taken in the name of the Trustee pursuant to this Section
3.13 without
further documentation of its authority as attorney in fact for the
Trustee on
behalf of the Trust.
(b) In the event that the Trust Fund acquires any REO Property
as
aforesaid or otherwise in connection with a default or imminent
default on a
Mortgage Loan, the Servicer shall dispose of such REO Property
before the end of
the third calendar year beginning after the year of its acquisition
by the Trust
Fund for purposes of Section 860G(a)(8) of the Code or, at the
expense of the
Trust Fund, request from the Internal Revenue Service, more than 60
days before
the day on which the above-mentioned grace period would otherwise
expire, an
extension of the above-mentioned grace period, unless the Servicer
obtains an
Opinion of Counsel, addressed and delivered to the Servicer and the
Trustee, to
the effect that the holding by the Trust Fund of such REO Property
subsequent to
such period will not: (i) result in the imposition of any tax on
"prohibited
transactions" as defined in Section 860F of the Code; or (ii) cause
any REMIC
constituting any part of the Trust Fund to fail to qualify as a
REMIC at any
time that any Certificates are outstanding, in which case the Trust
Fund may
continue to hold such REO Property (subject to any conditions
contained in such
Opinion of Counsel). The Servicer shall be entitled to be
reimbursed from the
Collection Account for any costs incurred in obtaining such Opinion
of Counsel,
as provided in Section 3.05.
Subject to compliance with applicable laws and regulations as
shall
at any time be in force, and notwithstanding any other provisions
of this
Agreement, no REO Property acquired by the Trust Fund shall be
rented (or
allowed to continue to be rented) or otherwise used by or on behalf
of the Trust
Fund in such a manner or pursuant to any terms that would: (i)
cause such REO
Property to fail to qualify as "foreclosure property" within the
meaning of
Section 860G(a)(8) of the Code; or (ii) subject any REMIC
constituting part of
the Trust Fund to the imposition of any federal income taxes on the
income
earned from such REO Property, including any taxes imposed by
reason of Sections
860F or 860G(c) of the Code, unless the Servicer has agreed to
indemnify and
hold harmless the Trust Fund with respect to the imposition of any
such taxes.
The Servicer shall manage, conserve, protect and operate each
REO
Property for the Certificateholders and the Trust Fund solely for
the purpose of
its prompt disposition and sale in a manner which does not cause
such REO
Property to fail to qualify as "foreclosure property" within the
meaning of
Section 860G(a)(8) of the Code or result in the receipt by the
related REMIC of
any "income from non-permitted assets" within the meaning of
Section
860F(a)(2)(B) of the Code, or any "net income from foreclosure
property" which
is subject to taxation under the REMIC Provisions. The Servicer
shall cause each
REO Property to be inspected promptly upon the acquisition of title
thereto and
possession thereof and shall cause each REO Property to be
inspected at least
annually thereafter. The Servicer shall make or cause to be made a
written or
electronic report of each such inspection. Such reports shall be
retained in the
Mortgage File and copies thereof shall be forwarded by the Servicer
to the
Trustee upon request. The Servicer shall attempt to sell the same
(and may
temporarily rent the same) on such terms and conditions as the
Servicer deems to
be in the best interest of the Certificateholders and the Trust
Fund.
With respect to each REO Property, the Servicer shall segregate
and
hold all funds collected and received in connection with the
operation of the
REO Property separate and apart from its own funds or general
assets and shall
deposit or cause to be deposited, on a daily basis, within three
Business Days
of receipt, into the Collection Account, all revenues received with
respect to
the related REO Property and shall withdraw therefrom funds
necessary for the
proper operation, management and maintenance of the REO Property,
including the
cost of maintaining any hazard insurance pursuant to Section 3.10
hereof and the
fees of any managing agent acting on behalf of the Servicer.
The Servicer shall furnish to the Securities Administrator and
the
Trustee, on each Servicer Remittance Date, an operating statement
for each REO
Property covering the operation of each REO Property for the
previous month, if
applicable. Such operation statement shall be accompanied by such
other
information as the Securities Administrator or the Trustee shall
reasonably
request.
The Servicer shall use its best efforts to dispose of the REO
Property as promptly as is practically consistent with protecting
the
Certificateholders' interests.
Each REO Disposition shall be carried out by the Servicer at
such
price and upon such terms and conditions as the Servicer deems to
be in the best
interest of the Certificateholders. If as of the date title to any
REO Property
was acquired by the Servicer there were outstanding unreimbursed
Servicing
Advances with respect to the REO Property, the Servicer, upon an
REO Disposition
of such REO Property, shall be entitled to reimbursement for any
related
unreimbursed Servicing Advances from proceeds received in
connection with such
REO Disposition. The Servicer shall be entitled to an REO
Disposition Fee upon
each REO Disposition, and may withhold and retain the REO
Disposition Fee from
Liquidation Proceeds. The proceeds from the REO Disposition, net of
any payments
to the Servicer as provided above, shall be deposited in the
Collection Account
and shall be distributed to the Trust in the month following
receipt thereof in
accordance with Section 4.01.
Any REO Disposition shall be for cash only (unless changes in
the
REMIC Provisions made subsequent to the Startup Day allow a sale
for other
consideration and an Opinion of Counsel is obtained by the Servicer
to the
effect that such sale shall not cause any REMIC constituting part
of the Trust
Fund to fail to qualify as a REMIC).
Section 3.14 Due-on-Sale Clauses; Assumption and Substitution
Agreements. When a Mortgaged Property has been or is about to be
conveyed by the
Mortgagor, the Servicer shall, to the extent it has knowledge of
such conveyance
or prospective conveyance, exercise its rights to accelerate the
maturity of the
related Mortgage Loan under any "due-on-sale" clause contained in
the related
Mortgage or Mortgage Note; provided, however, that the Servicer
shall not
exercise any such right if the "due-on-sale" clause, in the
reasonable belief of
the Servicer, is not enforceable under applicable law. In such
event, the
Servicer shall make reasonable efforts to enter into an assumption
and
modification agreement with the Person to whom such property has
been or is
about to be conveyed, pursuant to which such Person becomes liable
under the
Mortgage Note and, unless prohibited by applicable law or the
Mortgage, the
Mortgagor remains liable thereon. If the foregoing is not permitted
under
applicable law, the Servicer is authorized to enter into a
substitution of
liability agreement with such Person, pursuant to which the
original Mortgagor
is released from liability and such Person is substituted as
Mortgagor and
becomes liable under the Note. The Mortgage Loan, as assumed, shall
conform in
all respects to the requirements, representations and warranties of
this
Agreement. The Servicer shall notify the Trustee that any such
assumption or
substitution agreement has been completed by forwarding to the
Trustee (or the
Custodian, as the case may be) the original copy of such assumption
or
substitution agreement (indicating the Mortgage File to which it
relates) which
copy shall be added by the Trustee (or the Custodian, as the case
may be) to the
related Mortgage File and which shall, for all purposes, be
considered a part of
such Mortgage File to the same extent as all other documents and
instruments
constituting a part thereof. The Servicer shall be responsible for
recording any
such assumption or substitution agreements. Except as otherwise
provided in
Section 3.01, in connection with any such assumption or
substitution agreement,
the Monthly Payment on the related Mortgage Loan shall not be
changed but shall
remain as in effect immediately prior to the assumption or
substitution, the
stated maturity or outstanding principal amount of such Mortgage
Loan shall not
be changed nor shall any required monthly payments of principal or
interest be
deferred or forgiven. Any fee collected by the Servicer for
consenting to any
such conveyance or entering into an assumption or substitution
agreement shall
be retained by or paid to the Servicer as additional servicing
compensation.
Notwithstanding the foregoing paragraph or any other provision
of
this Agreement, the Servicer shall not be deemed to be in default,
breach or any
other violation of its obligations hereunder by reason of any
assumption of a
Mortgage Loan by operation of law or any assumption which the
Servicer may be
restricted by law from preventing, for any reason whatsoever.
Section 3.15 Duties of the Credit Risk Manager.
For and on behalf of the Trust, the Credit Risk Manager shall
provide reports and recommendations as to loss mitigation
activities concerning
Mortgage Loans that are past due, are in default, as to which there
has been
commencement of foreclosure, as to which there has been forbearance
in exercise
of remedies, as to which any obligor is the subject of bankruptcy,
receivership,
or an arrangement of creditors, or which have become REO
Properties. Such
reports and recommendations will be based upon information provided
pursuant to
the Credit Risk Management Agreement. The Credit Risk Manager shall
look solely
to the Servicer for all information and data (including loss and
delinquency
information and data) and loan-level information and data relating
to the
servicing of the Mortgage Loans.
The Credit Risk Manager may be removed at any time by a vote of
Certificateholders holding Certificates evidencing at least 66 2/3%
of the
aggregate Voting Interests of the Certificates. After any such
termination, the
Credit Risk Manager shall have no further obligations hereunder,
and shall no
longer be entitled to the Credit Risk Manager Fee.
Section 3.16 Optional Purchases of 60+ Day Delinquent Loans. (a)
The
Depositor may, at its option, purchase any 60+ Day Delinquent Loan
or any
Mortgage Loan or REO Property for which the Servicer has accepted a
deed in lieu
of foreclosure during the following time periods: (i) beginning on
the first day
of the second month following the month in which the Servicer has
reported that
it has initiated foreclosure proceedings with respect to such 60+
Day Delinquent
Loan, with such repurchase option expiring on the last day of such
second
following month; (ii) beginning on the first day of the second
month following
the month in which the Servicer has reported that such defaulted
Mortgage Loan
has become an REO Property, with such repurchase option expiring on
the last day
of such second following month; and (iii) beginning on the day on
which the
Servicer accepts a contractual commitment by a third party to
purchase the
Mortgaged Property related to the 60+ Day Delinquent Loan or REO
Property, with
such repurchase option expiring on the earlier of the last day of
the month in
which such contractual commitment was accepted by the Servicer or
the day
immediately prior to the day on which the closing occurs with
respect to such
third party purchase of the Mortgaged Property related to the 60+
Day Delinquent
Loan or REO Property.
Prior to purchase pursuant to this Section 3.16, the Servicer
shall
be required to continue to make monthly Advances pursuant to
Section 4.07. The
Depositor shall not use any procedure in selecting Mortgage Loans
to be
purchased which is materially adverse to the interests of the
Certificateholders. The Depositor shall purchase any such 60+ Day
Delinquent
Loan or REO Property that it elects to purchase at a price equal to
the Purchase
Price. The Purchase Price for the repurchased Mortgage Loan or REO
Property
shall be deposited in the Collection Account, and the Trustee, upon
receipt of
written certification from the Depositor of such deposit, shall
release to, or
at the direction of, the Depositor, the related Mortgage File and
shall execute
and deliver such instruments of transfer or assignment, in each
case without
recourse, as the Depositor shall furnish to it and as shall be
necessary to vest
in the Depositor any Mortgage Loan or REO Property released
pursuant hereto and
the Trustee shall have no further responsibility with regard to
such Mortgage
File.
Section 3.17 Trustee to Cooperate; Release of Files. (a) Upon
the
payment in full of any Mortgage Loan (including any liquidation of
any Mortgage
Loan through foreclosure or otherwise, 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 shall confirm to the Trustee and the
Securities
Administrator that all amounts required to be remitted to the
Distribution
Account in connection with such Mortgage Loan have been so
deposited, and the
Servicer shall deliver two copies of such Request for Release to
the Custodian.
The Custodian shall, within five Business Days of its receipt of
such a Request
for Release, release the related Owner Mortgage File (and Retained
Mortgage
File, if applicable) to the Servicer, as requested by the Servicer.
No expenses
incurred in connection with any instrument of satisfaction or deed
of
reconveyance shall be chargeable to the Distribution Account.
From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, including but not limited to,
collection under
any insurance policies, or to effect a partial release of any
Mortgaged Property
from the lien of the Mortgage, the Servicer shall deliver to the
Custodian two
copies of a Request for Release. The Custodian shall, within five
Business Days,
release the related Owner Mortgage File (and Retained Mortgage
File, if
applicable) to the Servicer. Any such Request for Release shall
obligate the
Servicer to return the Owner Mortgage File (and Retained Mortgage
File, if
applicable) to the Custodian by the twenty-first day following the
release
thereof, unless (i) the Mortgage Loan has been liquidated and the
Liquidation
Proceeds relating to the Mortgage Loan have been deposited in the
Distribution
Account or (ii) the Owner Mortgage File (or Retained Mortgage File,
if
applicable) or any documents contained therein have been delivered
to an
attorney, or to a public trustee or other public official as
required by law,
for purposes of initiating or pursuing legal action or other
proceedings for the
foreclosure of the Mortgaged Property either judicially or
non-judicially. Upon
receipt of two copies of a Request for Release stating that such
Mortgage Loan
was liquidated and that all amounts received or to be received in
connection
with such liquidation which are required to be deposited into the
Distribution
Account have been so deposited, or that such Mortgage Loan has
become an REO
Property, the Custodian shall amend its records.
Upon the
occurrence of the event specified in clause (ii) of the
preceding paragraph, the Trustee shall execute and deliver to the
Servicer, as
directed by the Servicer, court pleadings, requests for trustee's
sale or other
documents necessary to the foreclosure or trustee's sale in respect
of a
Mortgaged Property or to any legal action brought to obtain
judgment against any
Mortgagor on the Mortgage Note or Mortgage or to obtain a
deficiency judgment,
or to enforce any other remedies or rights provided by the Mortgage
Note or
Mortgage or otherwise available at law or in equity. Each such
direction shall
include a request that such pleadings or documents be executed by
the Trustee
and a statement as to the reason such documents or pleadings are
required and a
certification that the execution and delivery thereof by the
Trustee will not
invalidate or otherwise affect the lien of the Mortgage, except for
the
termination of such a lien upon completion of the foreclosure
proceeding or
trustee's sale.
(b)
Subject to Section 3.01, the Servicer shall have the right to
accept applications of Mortgagors for consent to (i) partial
releases of
Mortgages, (ii) alterations, and (iii) removal, demolition or
division of
properties subject to Mortgages. No application for approval shall
be considered
by the Servicer unless: (w) either (A) it has received an Opinion
of Counsel,
addressed to the Trustee (which opinion shall not be an expense of
the Trustee
or the Trust Fund) that such sale, disposition, substitution,
acquisition or
contribution will not affect adversely the status of any REMIC
constituting part
of the Trust Fund as a REMIC or cause any REMIC constituting part
of the Trust
Fund to be subject to a tax on "prohibited transactions" or
"contributions"
pursuant to the REMIC Provisions or (B) other evidence satisfactory
to the
Servicer; (x) the provisions of the related Mortgage Note and
Mortgage have been
complied with; (y) the Loan-to-Value Ratio and debt-to-income ratio
after any
release does not exceed the maximum Loan-to-Value Ratio and
debt-to-income ratio
established in accordance with the underwriting standards of the
Mortgage Loans;
and (z) the lien priority of the related Mortgage is not affected.
Upon receipt
by the Trustee of a Servicing Officer's certificate setting forth
the action
proposed to be taken in respect of a particular Mortgage Loan and
certifying
that the criteria set forth in the immediately preceding sentence
have been
satisfied, the Trustee shall execute and deliver to the Servicer
the consent or
partial release so requested by, and furnished to it by, the
Servicer. A
proposed form of consent or partial release, as the case may be,
shall accompany
any Servicing Officer's certificate delivered by the Servicer
pursuant to this
paragraph.
Section 3.18 Servicing Compensation. As compensation for its
activities hereunder, the Servicer shall be entitled to retain the
amount of the
Servicing Fee with respect to each Mortgage Loan (including REO
Properties). The
Servicer shall be entitled to retain additional servicing
compensation in the
form of release fees, bad check charges, assumption fees,
modification or
extension fees, late payment charges, prepayment penalties that are
not
Prepayment Penalties, Servicer Prepayment Penalty Payment Amounts,
Originator
Prepayment Penalty Payment Amounts or REO Disposition Fees, or any
other
service-related fees, Insurance Proceeds and Liquidation Proceeds
not required
to be deposited in the Collection Account and similar items, to the
extent
collected from Mortgagors. In addition, the Servicer shall be
entitled to the
investment income on funds on deposit in the Collection
Account.
Section 3.19 Annual Statement as to Compliance. (a) The
Securities
Administrator shall deliver in electronic format or otherwise make
available to
the Depositor and the Servicer shall deliver in electronic form, or
otherwise
make available to the Securities Administrator, and the Servicer
shall cause
each Additional Servicer engaged by it to deliver, in electronic
form, or
otherwise make available, to the Securities Administrator, the
Trustee and each
Rating Agency on or before March 5 of each year or if such day is
not a Business
Day, the next Business Day (with a 10 calendar day cure period, but
in no event
later than March 15), commencing in March 200 , a copy of a
certificate
(followed by a hard copy to the party or parties receiving such
certificate
within 10 calendar days) in the form required by Item 1123 of
Regulation AB, to
the effect that (i) an authorized officer of the Securities
Administrator, the
Servicer or the Additional Servicer, as the case may be, has
reviewed (or a
review has been made under his or her supervision of) such party's
activities
under this Agreement or such other applicable agreement in the case
of an
Additional Servicer, during the prior calendar year or portion
thereof and (ii)
to the best of such officer's knowledge, based on such review, such
party has
fulfilled all of its obligations under this Agreement or such other
applicable
agreement in the case of an Additional Servicer, in all material
respects
throughout the prior calendar year or portion thereof or, if there
has been a
failure to fulfill any such obligation in any material respect,
specifying each
such failure known to such officer and the nature and status
thereof. If any of
the certificates delivered pursuant to this Section 3.19 disclose
that there has
been a failure to fulfill any obligation in any material respect
then the
Securities Administrator shall promptly notify the Depositor and
forward a copy
of such certificate to the Depositor, and the Depositor shall
review such
certificate and, if applicable, consult with the Servicer as to the
nature of
any failure to fulfill any obligation under this Agreement or such
other
applicable agreement in the case of an Additional Servicer, in any
material
respect.
(b) Delivery of such reports, information and documents to the
Securities Administrator is for informational purposes only and the
Trustee's,
Securities Administrator's and Depositor's receipt of such shall
not constitute
constructive notice of any information contained therein or
determinable, from
information contained therein, including the Servicer's compliance
with any of
its covenants hereunder (as to which the Trustee, the Securities
Administrator
and the Depositor are entitled to rely exclusively on Officers'
Certificates).
Section 3.20 Assessment of Servicing Compliance; Registered
Public
Accounting Firm Attestation Reports.
(a) The Securities Administrator, at its own expense, shall
furnish
to the Depositor, and the Servicer, the Trustee and the Custodian,
at their own
expense, shall furnish, or otherwise make available, and shall
cause any
Servicing Function Participant engaged by any such party to
furnish, to the
Securities Administrator, not later than March 5 of each year, or
if such day is
not a Business Day, the next Business Day (with a 10 day cure
period, but in no
event later than March 15), commencing in March 200 , a copy of a
report,
followed by a hard copy to the Securities Administrator within 10
calendar days,
signed by an authorized officer of the Securities Administrator,
the Trustee,
the Custodian, the Servicing Function Participant or the Servicer,
as
applicable, on assessment of compliance with, at a minimum, the
Relevant
Servicing Criteria that contains:
(i) a statement by such party of its responsibility for
assessing
compliance
with the Servicing Criteria applicable to it;
(ii) a statement that such party used the Servicing Criteria
applicable
to it to assess compliance with the Servicing Criteria;
(iii) such party's assessment of compliance with the Servicing
Criteria
applicable to it as of and for the preceding fiscal year,
including,
if there had been any material instance of noncompliance with
the
Servicing Criteria applicable to it, identifying each such failure
and
the nature
and status thereof; and
(iv) a statement that a registered public accounting firm has
issued
an
attestation report on such party's assessment of compliance with
the
Servicing
Criteria applicable to it as of and for the preceding fiscal
year.
No later than 30 days following the end of each fiscal year,
the
Securities Administrator shall forward to the Depositor the name of
each
Servicing Function Participant engaged by it and what Relevant
Servicing
Criteria will be addressed in the report on assessment of
compliance prepared by
such Servicing Function Participant. When the Securities
Administrator submits
its assessments to the Depositor, it will also at such time include
the
assessment (and attestation pursuant to Section 3.20(b)) of each
Servicing
Function Participant engaged by it.
No later than 30 days following the end of each fiscal year, each
of
the Servicer, the Trustee and the Custodian (so long as the
Custodian is not the
Securities Administrator) shall forward to the Securities
Administrator the name
of each Servicing Function Participant engaged by it and what
Relevant Servicing
Criteria will be addressed in the report on assessment of
compliance prepared by
such Servicing Function Participant. When the Servicer, the
Trustee, the
Servicer and the Custodian (so long as the Custodian is not the
Securities
Administrator) submit their assessments to the Securities
Administrator, each
such party will also at such time include the assessment (and
attestation
pursuant to Section 3.20(b)) of each Servicing Function Participant
engaged by
it.
The Securities Administrator shall confirm that the assessments
address the Relevant Servicing Criteria for each party as set forth
on Exhibit S
and shall notify the Depositor of any exceptions and deliver the
assessment of
compliance containing such exceptions. Promptly after receipt of
each such
report on assessment of compliance, the Depositor shall review each
such report
and, if applicable, consult with the Securities Administrator, the
Trustee, the
Custodian, the Servicer and any Servicing Function Participant as
to the nature
of any material instance of noncompliance with the Relevant
Servicing Criteria
by the Securities Administrator, the Trustee, the Custodian, the
Servicer or any
Servicing Function Participant engaged by such parties.
(b) The Securities Administrator, at its own expense, shall cause
a
registered public accounting firm which is a member of the
Institute of
Certified Public Accountants to furnish to the Depositor, and each
of the
Trustee, the Servicer and the Custodian at their own expense, shall
cause, and
shall cause any Servicing Function Participant engaged by any such
party, at
such party's expense, to cause a registered public accounting firm
which is a
member of the Institute of Certified Public Accountants to furnish
to the
Securities Administrator, not later than March 5 of each year, or
if such day is
not a Business Day, the next Business Day (with a 10 calendar day
cure period,
but in no event later than March 15), commencing in March 200 , an
electronic
report (with a hard copy to follow within 10 calendar days) to the
effect that
(i) it has obtained a representation regarding certain matters from
the
management of such party, which includes an assertion that such
party has
complied with the Relevant Servicing Criteria, and (ii) on the
basis of an
examination conducted by such firm in accordance with standards for
attestation
engagements issued or adopted by the Public Company Accounting
Oversight Board,
it is expressing an opinion as to whether such party's assessment
of compliance
with the Relevant Servicing Criteria was fairly stated in all
material respects,
or it cannot express an overall opinion regarding such party's
assessment of
compliance with the Relevant Servicing Criteria. In the event that
an overall
opinion cannot be expressed, such registered public accounting firm
shall state
in such report why it was unable to express such an opinion. Such
report must be
available for general use and not contain restricted use language.
If requested
by the Securities Administrator or the Depositor, such report shall
contain or
be accompanied by a consent of such accounting firm to inclusion
or
incorporation of such report in the Depositor's Registration
Statement on Form
S-3 relating to the Certificates and the Trust's Form 10-K.
Promptly after receipt of such report from the Securities
Administrator, the Depositor shall review the report and, if
applicable, consult
with the Securities Administrator if any such report (i) states
that the party's
assessment of compliance was not fairly stated in a material
respect or (ii) is
unable to state an overall opinion.
Promptly after receipt of such report from the Trustee, the
Custodian, the Servicer or any Servicing Function Participant
engaged by such
parties, the Securities Administrator shall review the report and
shall promptly
notify the Depositor if any such report (i) states that the party's
assessment
of compliance was not fairly stated in a material respect or (ii)
is unable to
state an overall opinion and the Depositor shall promptly review
each such
report and the Depositor and the Securities Administrator shall
consult with the
parties to which such report relates.
(c)
The Securities Administrator shall make available any report
from the Securities Administrator, the Trustee, the Custodian, the
Servicer, or
any Servicing Function Participant furnished pursuant to Section
3.19 and this
Section 3.20, as well as any documents incorporated by reference
into the
Prospectus (to the extent such documents are either in its
possession or have
been filed with the Commission), to any Certificateholder
requesting such
information.
Section 3.21 Access to Certain Documentation and Information
Regarding the Mortgage Loans. The Servicer shall provide to the
Trustee, the
Securities Administrator, Certific
