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EXHIBIT 4.1
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POOLING AND SERVICING AGREEMENT
Dated as of __________, 200_
by and among
HSI Asset Securitization Corporation
(Depositor)
and
----------------------------------------
(Transferor)
----------------------------------------
(Master Servicer)
and
----------------------------------------
(Trustee)
_______ Home Equity Trust 200_ - _
_______ Home Equity Asset Backed Certificates,
Series 200_ - _
Class _ and Class _
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<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
Section 1.1 Certain Defined
Terms..........................................1
Section 1.2 Provisions Of General
Application.............................26
ARTICLE II
ESTABLISHMENT OF THE TRUST;
SALE AND CONVEYANCE OF TRUST FUND
Section 2.1 Sale And Conveyance Of Trust Fund; Priority And
Subordination Of Ownership Interests; Establishment Of
The
Trust....................................................27
Section 2.2 Possession Of Mortgage Files; Access To Mortgage
Files........27
Section 2.3 Delivery Of Mortgage Loan
Documents...........................28
Section 2.4 Acceptance By Trustee Of The Trust Fund; Certain
Substitutions; Certification By
Trustee......................30
Section 2.5 Designations Under REMIC Provisions; Designation
Of
Startup
Date.................................................32
Section 2.6 Execution Of
Certificates.....................................32
Section 2.7 Application Of Principal And
Interest.........................33
Section 2.8 Grant Of Security
Interest....................................33
Section 2.9 Further Assurances; Powers Of
Attorney........................33
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.1 Representations Of The Master
Servicer........................35
Section 3.2 Representations, Warranties And Covenants Of The
Depositor....36
Section 3.3 Purchase And
Substitution.....................................37
Section 3.4 Master Servicer
Covenants.....................................38
ARTICLE IV
THE CERTIFICATES
Section 4.1 The
Certificates..............................................40
Section 4.2 Registration Of Transfer And Exchange Of
Certificates.........40
Section 4.3 Mutilated, Destroyed, Lost Or Stolen
Certificates.............45
Section 4.4 Persons Deemed
Owners.........................................46
ARTICLE V
ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS
Section 5.1 Appointment Of The Master
Servicer............................47
Section 5.2 Subservicing Agreements Between The Master Servicer
And
Subservicers.................................................49
Section 5.3 Collection Of Certain Mortgage Loan Payments;
Collection
Account......................................................50
Section 5.4 Permitted Withdrawals From The Collection Account
And
Trustee Collection
Account...................................52
Section 5.5 Payment Of Taxes, Insurance And Other
Charges.................53
Section 5.6 Maintenance Of Casualty
Insurance.............................54
Section 5.7 Master Servicer
Account.......................................55
Section 5.8 Fidelity Bond; Errors And Omissions
Policy....................55
Section 5.9 Collection Of Taxes, Assessments And Other
Items..............56
Section 5.10 Periodic Filings With The Securities And
Exchange
Commission; Additional
Information...........................56
Section 5.11 Enforcement Of Due-On-Sale Clauses; Assumption
Agreements.....56
Section 5.12 Realization Upon Defaulted Mortgage
Loans.....................57
Section 5.13 Trustee To Cooperate; Release Of Mortgage
Files...............59
Section 5.14 Servicing Fee; Servicing
Compensation.........................60
Section 5.15 Reports To The Trustee; Collection Account
Statements.........61
Section 5.16 Annual Statement As To
Compliance.............................61
Section 5.17 Annual Independent Public Accountants' Servicing
Report.......61
Section 5.18 Reports To Be Provided By The Master
Servicer.................62
Section 5.19 Adjustment Of Servicing Compensation In Respect
Of
Prepaid Mortgage
Loans.......................................63
Section 5.20 Periodic
Advances.............................................63
Section 5.21 Indemnification; Third Party
Claims...........................63
Section 5.22 Maintenance Of Corporate Existence And Licenses;
Merger
Or Consolidation Of The Master
Servicer......................64
Section 5.23 Assignment Of Agreement By Master Servicer;
Master
Servicer Not To
Resign.......................................65
ARTICLE VI
DISTRIBUTIONS AND PAYMENTS
Section 6.1 Establishment Of Certificate Account, Deposits To
The
Certificate
Account..........................................66
Section 6.2 Permitted Withdrawals From The Certificate
Account............66
Section 6.3 Collection Of
Money...........................................67
[Section 6.4 The certificate insurance
policy..............................67
Section 6.5
Distributions.................................................68
Section 6.6 Investment Of
Accounts........................................70
Section 6.7 Reports By
Trustee............................................71
Section 6.8 Additional Reports By Trustee And By Master
Servicer..........73
Section 6.9 Compensating
Interest.........................................74
[Section 6.10 Effect Of Payments By The Certificate Insurer;
Subrogation....74
ARTICLE VII
DEFAULT
Section 7.1 Events Of
Default.............................................75
Section 7.2 Trustee To Act; Appointment Of
Successor......................76
Section 7.3 Waiver Of
Defaults............................................78
Section 7.4 Mortgage Loans, Trust Fund And Accounts Held For
Benefit
Of The Certificate
Insurer...................................78
ARTICLE VIII
TERMINATION
Section 8.1
Termination...................................................79
Section 8.2 Additional Termination
Requirements...........................80
Section 8.3 Accounting Upon Termination Of Master
Servicer................81
ARTICLE IX
THE TRUSTEE
Section 9.1 Duties Of
Trustee.............................................81
Section 9.2 Certain Matters Affecting The
Trustee.........................86
Section 9.3 Not Liable For Certificates Or Mortgage
Loans.................88
Section 9.4 Trustee May Own
Certificates..................................88
Section 9.5 Trustee's Fees And Expenses;
Indemnity........................88
Section 9.6 Eligibility Requirements For
Trustee..........................88
Section 9.7 Resignation And Removal Of The
Trustee........................89
Section 9.8 Successor
Trustee.............................................89
Section 9.9 Merger Or Consolidation Of
Trustee............................90
Section 9.10 Appointment Of Co-Trustee Or Separate
Trustee.................90
Section 9.11 Tax Returns; OID Interest
Reporting...........................91
[Section 9.12 Retirement Of
Certificates....................................91
ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.1 Limitation On Liability Of The Depositor And The
Master
Servicer.....................................................92
Section 10.2 Acts Of Certificateholders; Certificateholders'
Rights........92
Section 10.3 Amendment Or
Supplement.......................................93
Section 10.4 Recordation Of
Agreement......................................94
Section 10.5 Duration Of
Agreement.........................................94
Section 10.6
Notices.......................................................94
Section 10.7 Severability Of
Provisions....................................94
Section 10.8 No
Partnership................................................95
Section 10.9
Counterparts..................................................95
Section 10.10 Successors And
Assigns........................................95
Section 10.11
Headings......................................................95
[Section 10.12 The Certificate Insurer
Default..............................95
Section 10.13 Third Party
Beneficiary.......................................95
Section 10.14 Intent Of The
Parties.........................................95
Section 10.15 Appointment Of Tax Matters
Person.............................95
Section 10.16 Governing Law Consent To Jurisdiction; Waiver of
Jury
Trial........................................................95
EXHIBITS
[EXHIBIT A Specimen Certificate Insurance Policy]
EXHIBIT B-1 Specimen Class A-1 Certificate
EXHIBIT B-2 Specimen Class A-2 Certificate
EXHIBIT B-3 Specimen Class A-3 Certificate
EXHIBIT B-4 Specimen Class A-4 Certificate
EXHIBIT B-5 Specimen Class A-5 Certificate
EXHIBIT B-6 Specimen Class R Certificate
EXHIBIT C Contents of Mortgage File
EXHIBIT D Mortgage Loan Schedule
EXHIBIT E Trustee's Certificate as to Mortgage Files
EXHIBIT F Form of Initial Certification of Trustee
EXHIBIT G Form of Final Certification of Trustee
EXHIBIT H Form of Request for Release of Mortgage Files
EXHIBIT I Form of Transfer Affidavit and Agreement
EXHIBIT J Form of Certificate to Be Delivered by Transferring
Holder
EXHIBIT K Form of ERISA Investment Representation Letter
EXHIBIT L Form of Officer's Certificate of the Transferor:
Prepaid Loans
EXHIBIT M Form of Transferee's Letter
<PAGE>
This Pooling and Servicing Agreement, relating to _______
Home
Equity Trust 200_ - _ (the "Trust"), dated as of __________,
200_ by and among
HSI Asset Securitization Corporation, as depositor of the Trust
(the
"Depositor"), __________________, as Transferor (the
"Transferor"),
____________________, as Master Servicer, (the "Master
Servicer"), and
____________________, in its capacity as trustee (the
"Trustee").
W I T N E S S E T H:
WHEREAS, the Depositor wishes to establish a trust which
provides
for the allocation and sale of the beneficial interests therein
and the
maintenance and distribution of the trust estate;
WHEREAS, the Master Servicer has agreed to service the
Mortgage
Loans, which constitute the principal assets of the trust
estate;
WHEREAS, ____________________, is willing to serve in the
capacity
of Trustee hereunder; and
[WHEREAS, ____________________ (the "Certificate Insurer")
is
intended to be a third-party beneficiary of this Agreement and
is hereby
recognized by the parties hereto to be a third-party beneficiary
of this
Agreement.]
NOW, THEREFORE, in consideration of the premises and the
mutual
agreements herein contained, the Depositor, the Transferor, the
Master Servicer
and the Trustee hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Certain Defined Terms. Whenever used herein the
following words and phrases, unless the context otherwise
requires, shall have
the following meanings.
"200_ - _REMIC" shall mean the segregated pool of assets in
the
Trust Fund, consisting of: (i) the Mortgage Loans which are from
time to time
subject to this Agreement, together with the Mortgage Files
relating thereto and
all collections thereon and proceeds thereof, (ii) such assets
as from time to
time are identified as REO Property of the 200_ - _ REMIC and
collections
thereon and proceeds thereof, (iii) assets deposited in the
Certificate Account
including any such amounts on deposit in the Certificate Account
invested in
Permitted Investments, (iv) the Trustee's rights with respect to
the Mortgage
Loans under all insurance policies [(other than the Certificate
Insurance
Policy)] required to be maintained pursuant to this Agreement
and any Insurance
Proceeds, (v) Liquidation Proceeds, and (vi) Released Mortgaged
Property
Proceeds.
"Accepted Servicing Practices" shall mean the Master
Servicer's
normal servicing practices in servicing and administering
mortgage loans for its
own account, which will not be
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less stringent than the mortgage servicing practices of prudent
mortgage lending
institutions which service for their own account mortgage loans
of the same type
as the Mortgage Loans in the jurisdictions in which the related
Mortgaged
Properties are located and will give due consideration to [the
Certificate
Insurer's and] the Certificateholders' reliance on the Master
Servicer.
"Account" shall mean any Eligible Account established
hereunder.
"Accrual Period" shall mean (i) with respect to the Class
A-1
Certificates and any Remittance Date, the period commencing on
the immediately
preceding Remittance Date or, in the case of the first
Remittance Date, the
Closing Date, and ending on the day preceding such Remittance
Date and (ii) with
respect to the Certificates other than the Class A-1
Certificates and any
Remittance Date, the period commencing on the ___ day of the
month immediately
preceding the month in which such Remittance Date occurs and
ending on the last
day of the month immediately preceding the month in which such
Remittance Date
occurs.
"Adverse Remic Event" shall have the meaning set forth in
Section
5.1(c).
"Affiliate" shall mean, with respect to any Person, any other
Person
directly or indirectly controlling, controlled by, or under
direct or indirect
common control with such specified Person. For the purposes of
this definition,
"Control" when used with respect to any specified Person means
the power to
direct the management and policies of such Person, directly or
indirectly,
whether through the ownership of voting securities, by contract
or otherwise;
and the terms "Controlling" and "Controlled" have meanings
correlative to the
foregoing.
"Agreement" shall mean this Pooling and Servicing Agreement,
including the Exhibits hereto, as amended or supplemented from
time to time in
accordance herewith.
"Aggregate Principal Balance" shall mean the aggregated sum of
the
principal balances of each of the Mortgage Loans as of any date
of
determination.
"Appraised Value" shall mean the appraised value of any
Mortgaged
Property, based upon the appraisal or other property valuation
made at the time
the related Mortgage Loan is originated; provided that if no
such appraisal was
required to be made in accordance with the Underwriting
Guidelines, Appraised
Value shall mean the stated value of the Mortgaged Property as
set forth in the
loan application submitted by the related Mortgagor.
"Assignment Of Mortgage" shall mean, with respect to each
Mortgage
Loan, an assignment of the Mortgage, notice of transfer or
equivalent instrument
(which may be in blank) sufficient under the laws of the
jurisdiction wherein
the related Mortgaged Property is located to reflect of record
the sale of the
Mortgage to the Trustee for the benefit of the
Certificateholders [and the
Certificate Insurer].
"Authorized Denominations" shall mean, in the case of the Class
A
Certificates, $1,000 or integral multiples of $1,000 in excess
thereof;
provided, however, that one Class A-1 Certificate, one Class A-2
Certificate,
one Class A-3 Certificate, one Class A-4 Certificate and one
Class A-5
Certificate each is issuable in a denomination equal to an
amount less than
$1,000 such that the aggregate denomination of all Class A-1
Certificates, Class
A-2 Certificates, Class
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A-3 Certificates, Class A-4 Certificates or Class A-5
Certificates, as the case
may be, shall be equal to the applicable Original Class A-1
Principal Balance,
Original Class A-2 Principal Balance, Original Class A-3
Principal Balance,
Original Class A-4 Principal Balance or Original Class A-5
Principal Balance.
"Available Amount" shall mean for any Remittance Date, the (i)
the
Master Servicer Remittance Amount for such Remittance Date minus
(ii) the
Proportional Share of the Trustee Fee [and the Certificate
Insurance Premium
Amount].
"Base Principal Distribution Amount" shall mean, with respect to
the
Class A-1 Certificates, the Class A-2 Certificates, the Class
A-3 Certificates
and the Class A-4 Certificates for any Remittance Date, (A) the
sum of the
amounts referred to in clauses (i), (ii), (iii), (iv), (vi) and
(vii) of clause
(b) of the definition of Principal Distribution Amount for such
Remittance Date
minus (B) any overcollateralization release amount and such
Remittance Date.
"Business Day" shall mean any day other than (i) a Saturday
or
Sunday, or (ii) a day on which banking institutions in the State
of New York are
authorized or obligated by law or executive order to be
closed.
"Certificate" shall mean any Series 200_ - _ Class A Certificate
or
Series 200_ - _ Class R Certificate executed by the Trustee on
behalf of the
Trust Fund and authenticated by the Trustee.
"Certificate Account" shall mean the Certificate Account
established
in accordance with Section 6.1(a) hereof and maintained by the
Trustee.
"Certificateholder" shall mean, except as provided in Article
X,
each Person in whose name a Certificate is registered in the
Certificate
Register, except that, solely for the purposes of giving any
consent (except any
consent required to be obtained pursuant to Section 10.2),
waiver, requestor
demand pursuant to this Agreement, any Certificate registered in
the name of the
Master Servicer or any Subservicer or the Transferor, or any
Affiliate of any of
them, shall be deemed not to be outstanding and the undivided
interest in the
Trust Fund evidenced thereby shall not be taken into account in
determining
whether the requisite percentage of Certificates necessary to
effect any such
consent, waiver, request or demand has been obtained. For
purposes of any
consent, waiver, request or demand of Certificateholders
pursuant to this
Agreement, upon the Trustee's request, the Master Servicer and
the Transferor
shall provide to the Trustee a notice identifying any of their
respective
Affiliates or the Affiliates of any Subservicer that is a
Certificateholder as
of the date(s) specified by the Trustee in such request. [Any
Certificates on
which payments are made under the Certificate Insurance Policy
shall be deemed
to be outstanding and held by the Certificate Insurer to the
extent of such
payment.]
["Certificate Insurance Policy" shall mean the certificate
guaranty
insurance policy no. _________, and all endorsements thereto
dated the Closing
Date, issued by the Certificate Insurer for the benefit of the
Class A
Certificateholders, a copy of which is attached hereto as
Exhibit A.]
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<PAGE>
["Certificate Insurance Premium Amount" shall mean the product
of
the premium percentage and the Certificate Principal Balance for
the related
Remittance Date.]
["Certificate Insurer" shall mean ____________________, a
_______________ organized and created under the laws of the
State of __________,
and any successors thereto.
["Certificate Insurer Default" shall mean the existence and
continuance of any of the following: (i) a failure by the
Certificate Insurer to
make a payment required under a Certificate Insurance Policy in
accordance with
its terms; (ii) the entry of a decree or order of a court or
agency having
jurisdiction in respect of the Certificate Insurer in an
involuntary case under
any present or future federal or state bankruptcy, insolvency or
similar law
appointing a conservator or receiver or liquidator or other
similar official of
the Certificate Insurer or of any substantial part of its
property, or the
entering of an order for the winding up or liquidation of the
affairs of the
Certificate Insurer and the continuance of any such decree or
order undischarged
or unstayed and in force for a period of 90 consecutive days;
(iii) the
Certificate Insurer shall consent to the appointment of a
conservator or
receiver or liquidator or other similar proceedings or of
relating to the
Certificate Insurer or of or relating to all or substantially
all of its
property; or (iv) the Certificate Insurer shall admit in writing
its inability
to pay its debts generally as they become due, file a petition
to take advantage
of or otherwise voluntarily commence a case or proceeding under
any applicable
bankruptcy, insolvency, reorganization or other similar statute,
make an
assignment for the benefit of its creditors, or voluntarily
suspend payment of
its obligations.]
"Certificate Principal Balance" shall mean the sum of the Class
A-1
Principal Balance, the Class A-2 Principal Balance, the Class
A-3 Principal
Balance, the Class A-4 Principal Balance and the Class A-5
Principal Balance.
"Certificate Register" shall have the meaning described in
Section
4.2(a).
"Civil Relief Act" shall mean the Servicemembers Civil Relief
Act or
any similar state statutes.
"Class" shall mean any designated Class of Certificates of
this
Series or of any new Series issued hereunder.
"Class A Certificate" shall mean any Class A-1 Certificate,
any
Class A-2 Certificate, any Class A-3 Certificate, any Class A-4
Certificate or
any Class A-5 Certificate.
"Class A Certificateholder" shall mean a Holder of a Class
A-1
Certificate, a Class A-2 Certificate, a Class A-3 Certificate, a
Class A-4
Certificate or a Class A-5 Certificate.
"Class A-1 Certificate" shall mean any Certificate designated as
a
"Class A-1 Certificate" on the face thereof, in the form of
Exhibit B-1 hereto,
and authenticated by the Trustee in accordance with the
procedures set forth
herein.
"Class A-1 Certificateholder" shall mean a Holder of a Class
A-1
Certificate.
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<PAGE>
"Class A-1 Interest Distribution Amount" shall mean, with
respect to
the Class A-1 Certificates for any Remittance Date an amount
equal to the
aggregate of interest accrued at the Class A-1 Pass-Through Rate
during the
Accrual Period on the Class A-1 Principal Balance excluding (i)
any Mortgage
Loan Interest Shortfall and (ii) any reductions in interest
resulting from the
application of the Civil Relief Act, in each case allocable to
the Class A-1
Certificates and as of such Remittance Date.
"Class A-1 Pass-Through Rate" with respect to any Remittance
Date,
will be equal to a per annum rate (calculated on the basis of
actual days
elapsed divided by 360) equal to the lesser of (i) the sum of
(a) LIBOR on the
Interest Determination Date plus (b) ____% per annum and (ii)
the Weighted
Average Rate Cap.
"Class A-1 Principal Balance" shall mean, as of any date of
determination, the Original Class A-1 Principal Balance less any
Principal
Distribution Amount distributed on the Class A-1 Certificates on
all prior
Remittance Dates.
"Class A-2 Certificate" shall mean any Certificate designated as
a
"Class A-2 Certificate" on the face thereof, in the form of
Exhibit B-2 hereto,
and authenticated by the Trustee in accordance with the
procedures set forth
herein.
"Class A-2 Certificateholder" shall mean a Holder of a Class
A-2
Certificate.
"Class A-2 Interest Distribution Amount" shall mean, with
respect
to the Class A-2 Certificates for any Remittance Date an amount
equal to the
aggregate of interest accrued at the Class A-2 Pass-Through Rate
during the
Accrual Period on the Class A-2 Principal Balance excluding (i)
any Mortgage
Loan Interest Shortfall and (ii) any reductions in interest
resulting from the
application of the Civil Relief Act, in each case allocable to
the Class A-2
Certificates and as of such Remittance Date.
"Class A-2 Pass-Through Rate" with respect to any Remittance
Date,
will be equal to a ____% per annum rate (calculated on the basis
of an assumed
month of 30 days and an assumed year of 360 days).
"Class A-2 Principal Balance" shall mean, as of any date of
determination, the Original Class A-2 Principal Balance less any
Principal
Distribution Amount distributed on the Class A-2 Certificates on
all prior
Remittance Dates.
"Class A-3 Certificate" shall mean any Certificate designated as
a
"Class A-3 Certificate" on the face thereof, in the form of
Exhibit B-3 hereto,
and authenticated by the Trustee in accordance with the
procedures set forth
herein.
"Class A-3 Certificateholder" shall mean a Holder of a Class
A-3
Certificate.
"Class A-3 Interest Distribution Amount" shall mean, with
respect
to the Class A-3 Certificates for any Remittance Date an amount
equal to the
aggregate of interest accrued at the Class A-3 Pass-Through Rate
during the
Accrual Period on the Class A-3 Principal Balance excluding (i)
any Mortgage
Loan Interest Shortfall and (ii) any reductions in interest
resulting
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<PAGE>
from the application of the Civil Relief Act, in each case
allocable to the
Class A-3 Certificates and as of such Remittance Date.
"Class A-3 Pass-Through Rate" with respect to any Remittance
Date,
will be equal to a ____% per annum rate (calculated on the basis
of an assumed
month of 30 days and an assumed year of 360 days).
"Class A-3 Principal Balance" shall mean, as of any date of
determination, the Original Class A-3 Principal Balance less any
Principal
Distribution Amounts distributed on the Class A-3 Certificates
on all prior
Remittance Dates.
"Class A-4 Certificate" shall mean any Certificate designated as
a
"Class A-4 Certificate" on the face thereof, in the form of
Exhibit B-4 hereto,
and authenticated by the Trustee in accordance with the
procedures set forth
herein.
"Class A-4 Certificateholder" shall mean a Holder of a Class
A-4
Certificate.
"Class A-4 Interest Distribution Amount" shall mean, with
respect to
the Class A-4 Certificates for any Remittance Date an amount
equal to the
aggregate of interest accrued at the Class A-4 Pass-Through Rate
during the
Accrual Period on the Class A-4 Principal Balance excluding (i)
any Mortgage
Loan Interest Shortfall and (ii) any reductions in interest
resulting from the
application of the Civil Relief Act, in each case allocable to
the Class A-4
Certificates and as of such Remittance Date.
"Class A-4 Pass-Through Rate" with respect to any Remittance
Date
prior to the Optional Termination Date, will be equal to a ____%
per annum rate
and with respect to any other Remittance Date, will be equal to
a ____% per
annum rate (in each case calculated on the basis of an assumed
month of 30 days
and an assumed year of 360 days).
"Class A-4 Principal Balance" shall mean, as of any date of
determination, the Original Class A-4 Principal Balance less any
Principal
Distribution Amounts distributed on the Class A-4 Certificates
on all prior
Remittance Dates.
"Class A-5 Base Principal Distribution Amount" shall mean,
with
respect to the Class A-5 Certificates for any Remittance Date,
(A) the sum of
the amounts referred to in clauses (i), (ii), (iii), (iv), (vi)
and (vii) of
clause (b) of the definition of Class A-5 Principal Distribution
Amount for such
Remittance Date minus (B) any overcollateralization release
amount for such
Remittance Date.
"Class A-5 Certificate" shall mean any Certificate designated as
a
"Class A-5 Certificate" on the face thereof, in the form of
Exhibit B-5 hereto,
and authenticated by the Trustee in accordance with the
procedures set forth
herein.
"Class A-5 Certificateholder" shall mean a Holder of a Class
A-5
Certificate.
"Class A-5 Interest Distribution Amount" shall mean, with
respect to
the Class A-5 Certificates for any Remittance Date an amount
equal to the
aggregate of interest accrued at the Class A-5 Pass-Through Rate
during the
Accrual Period on the Class A-5 Principal Balance
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<PAGE>
excluding (i) any Mortgage Loan Interest Shortfall and (ii) any
reductions in
interest resulting from the application of the Civil Relief Act,
in each case
allocable to the Class A-5 Certificates and as of such
Remittance Date.
"Class A-5 Pass-Through Rate" with respect to any Remittance
Date
prior to the Optional Termination Date, will be equal to a ____%
per annum rate
and with respect to any other Remittance Date, will be equal to
a ____% per
annum rate (in each case calculated on the basis of an assumed
month of 30 days
and an assumed year of 360 days).
"Class A-5 Principal Balance" shall mean, as of any date of
determination, the Original Class A-5 Principal Balance less any
Class A-5
Principal Distribution Amounts distributed on the Class A-5
Certificates on all
prior Remittance Dates.
"Class A-5 Principal Distribution Amount" shall mean, with
respect
to the Class A-5 Certificates for any Remittance Date, the
lesser of:
(a) the excess of (1) the sum of the Available Amount, any
Excess
Spread and the applicable portion of any Insured Payment over
(2) the Class A-5
Interest Distribution Amount; and
(b) the sum, without duplication, of:
(i) that portion of all scheduled installments of principal
in
respect of the Mortgage Loans which is received (or advanced)
during the related
Due Period together with all unscheduled recoveries of principal
(including
Principal Prepayments, Curtailments and Deficient Valuations) on
such Mortgage
Loans actually collected by the Master Servicer during the prior
calendar month;
(ii) the principal balance of each Mortgage Loan that either
was,
effective on such Remittance Date, repurchased by the Transferor
or by the
Depositor or purchased by the Master Servicer during the
preceding Due Period,
but only to the extent the amount equal to such principal
balance is actually
received by the Trustee;
(iii) any Substitution Adjustment amounts delivered by the
Depositor
on the related Remittance Date in connection with a substitution
of a Mortgage
Loan, to the extent such Substitution Adjustments are actually
received by the
Trustee;
(iv) with respect to each Mortgage Loan that became a
Liquidated
Mortgage Loan during the prior calendar month, the principal
balance of such
Mortgage Loan immediately prior to the time when such Mortgage
Loan became a
Liquidated Mortgage Loan;
(v) any Overcollateralization Increase Amount;
(vi) to the extent of any Subordination Deficit the excess, if
any
of the Class A-5 Principal Balance over the Aggregate Principal
Balance of the
Mortgage Loans;
(vii) the portion of the proceeds relating to the Mortgage
Loans
received by the Trust Fund following any termination of the 200_
- _ REMIC
carried out in accordance with a
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<PAGE>
plan of complete liquidation pursuant to Section 8.2 hereof or
pursuant to the
optional termination of either of the Trust Fund or the 200_ - _
REMIC by either
the Master Servicer [or Certificate Insurer] in accordance with
Section 8.1
hereof, up to the then outstanding Class A-5 Principal Balance;
minus
(viii) any overcollateralization release amount.
"Class R Certificate" shall mean any Certificate denominated as
a
Class R Certificate and subordinate to the Class A Certificates
in right of
payment to the extent set forth herein, which Certificate shall
be in the form
of Exhibit B-6 hereto.
"Class R Certificateholder" shall mean a Holder of a Class R
Certificate.
"Closing Date" shall mean __________, 200_.
"Code" shall mean the Internal Revenue Code of 1986, as
amended.
"Collection Account" shall mean the Eligible Account established
and
maintained by the Master Servicer for the benefit of the
Certificateholders [and
the Certificate Insurer] pursuant to Section 5.3(a) hereof.
"Combined Loan-To-Value Ratio" shall mean with respect to
any
Mortgage Loan, (i) the sum of (x) the outstanding principal
balance of any
mortgage loan senior to such Mortgage Loan and secured by the
related Mortgaged
Property as of the date of origination of the related Mortgage
Loan, plus (y)
the principal balance of the related Mortgage Loan as of the
Cut-Off Date,
divided by (ii) the Appraised Value of such Mortgaged
Property.
"Commission" shall mean the Securities and Exchange
Commission.
"Compensating Interest" shall have the meaning defined in
Section
6.9 hereof.
"Curtailment" shall mean, with respect to a Mortgage Loan,
any
payment of principal received during a Due Period as part of a
payment that is
in excess of the amount of the Monthly Payment due for such Due
Period and which
is neither intended to satisfy the Mortgage Loan in full,
intended as an advance
payment of an amount due in a subsequent Due Period, nor
intended to cure a
delinquency.
"Custodian" shall have the meaning defined in Section
2.2(c).
"Cut-Off Date" shall mean the close of business on __________,
200_.
"Deficient Valuation" shall mean, with respect to any Mortgage
Loan,
a valuation of the related Mortgaged Property by a court of
competent
jurisdiction in an amount less than the then outstanding
principal balance of
the Mortgage Loan, which valuation results from a proceeding
initiated under the
United States Bankruptcy Code.
"Deleted Mortgage Loan" shall mean a Mortgage Loan replaced by
a
Qualified Substitute Mortgage Loan or repurchased pursuant to
Sections 2.4(c) or
3.3 hereof.
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<PAGE>
"Delinquent," a Mortgage Loan is "Delinquent" if any payment
due
thereon is not made by the close of business on the day such
payment is
scheduled to be due. A Mortgage Loan is "30 days delinquent" if
such payment has
not been received by the close of business on the corresponding
day of the month
immediately succeeding the month in which such payment was due,
or, if there is
no such corresponding day (e.g., as when a 30-day month follows
a 31-day month
in which a payment was due on the 31st day of such month) then
on the last day
of such immediately succeeding month. Similarly for "60 days
delinquent," "90
days delinquent" and so on.
"Depositor" shall mean HSI Asset Securitization Corporation and
any
successor thereto.
"Depository" shall mean the Depository Trust Company, 7
Hanover
Square, New York, New York 10004 and any successor Depository
hereafter named.
Depository Institution: Any depository institution or trust
company,
including the Trustee, that (a) is incorporated under the laws
of the United
States of America or any State thereof, (b) is subject to
supervision and
examination by federal or state banking authorities and (c) has
outstanding
unsecured commercial paper or other short-term unsecured debt
obligations that
are rated ____ by _______, ____ by _______ and ____ by
_______.
"Determination Date" shall mean the third Business Day prior to
the
Remittance Date.
"Direct Participant" shall mean any broker-dealer, bank or
other
financial institution for which the Depository holds Class A
Certificates from
time to time as a securities depositary.
"Due Date" shall mean, with respect to any Mortgage Loan, the
day of
the month upon which payment is due from the related Mortgagor
under the terms
of the related Mortgage Note.
"Due Period" shall mean, with respect to each Remittance Date,
the
period beginning on the opening of business on the first day of
the calendar
month preceding the calendar month in which such Remittance Date
occurs, and
ending at the close of business on the last day of the calendar
month preceding
the calendar month in which such Remittance Date occurs.
"Eligible Account" shall mean either (i) a segregated trust
account
or accounts maintained with a depositary institution which is
acceptable to the
Certificate Insurer and to each Rating Agency, which institution
shall be the
________________ until notice to the contrary is given to the
Master Servicer by
the Certificate Insurer and such trust account shall be held in
(a) the
corporate trust account department of such depositary
institution or (b) an
institution with capital and surplus of not less than
$50,000,000, and a minimum
unsecured debt rating of ___ by ____ or ____ by __________; or
(ii) an account
or accounts maintained with an institution acceptable to the
Certificate Insurer
and whose deposits are insured by the FDIC, the unsecured and
uncollateralized
debt obligations of which institution shall be rated ___ or
better by ___ and
___ or better by _______ and the highest short-term rating by
_______ and
_______, and which
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is (a) a federal savings and loan association duly organized,
validly existing
and in good standing under the federal banking laws, (b) an
institution duly
organized, validly existing and in good standing under the
applicable banking
laws of any state, (c) a national banking association duly
organized, validly
existing and in good standing under the federal banking laws
institution
(including the Trustee), (d) a principal subsidiary of a bank
holding company,
or (e) approved in writing by [the Certificate Insurer,] _____
and _____, having
capital and surplus of not less than $50,000,000, acting in its
fiduciary
capacity.
"ERISA" shall have the meaning defined in Section 4.2(i)(x)
hereof.
"Event Of Default" shall have the meaning described in Section
7.1.
"Excess Spread" shall mean the excess, if any, of the
Available
Amount over the sum of the Class A-1 Interest Distribution
Amount, the Class A-2
Interest Distribution Amount, the Class A-3 Interest
Distribution Amount, the
Class A-4 Interest Distribution Amount, the Class A-5 Interest
Distribution
Amount and the Base Principal Distribution Amount.
"FDIC" shall mean the Federal Deposit Insurance Corporation and
any
successor thereto.
"FHLMC" shall mean the Federal Home Loan Mortgage Corporation
and
any successor thereto.
"FNMA" shall mean the Federal National Mortgage Association and
any
successor thereto.
"Foreclosure Profits" shall mean, as to any Remittance Date,
the
excess, if any, of (i) Net Liquidation Proceeds in respect of
each Mortgage Loan
that became a Liquidated Mortgage Loan during the month
immediately preceding
the month of such Remittance Date over (ii) the sum of the
unpaid principal
balance of each such Liquidated Mortgage Loan plus accrued and
unpaid interest
at the applicable Mortgage Interest Rate on the unpaid principal
balance thereof
from the Due Date to which interest was last paid by the
Mortgagor (or, in the
case of a Liquidated Mortgage Loan that had been an REO Mortgage
Loan, from the
Due Date to which interest was last deemed to have been paid
pursuant to Section
5.12) to the first day of the month following the month in which
such Mortgage
Loan became a Liquidated Mortgage Loan.
"Holder" shall mean each Person in whose name a Certificate
is
registered in the Certificate Register, except that solely for
the purposes of
giving any consent (except any consent required to be obtained
pursuant to
Section 10.2), waiver, request or demand pursuant to this
Agreement, any
Certificate registered in the name of the Master Servicer or any
Subservicer or
the Transferor, or any Affiliate of any of them, shall be deemed
not to be
outstanding and in the case of any Certificate, the undivided
interest in the
Trust Fund evidenced thereby shall not be taken into account in
determining
whether the requisite percentage of Certificates necessary to
effect any such
consent, waiver, request or demand has been obtained.
"Indirect Participant" shall mean any financial institution for
whom
any Direct Participant holds an interest in a Class A
Certificate.
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<PAGE>
"Insurance Agreement" shall mean that certain agreement between
[the
Certificate Insurer], the Depositor, the Transferor, the Master
Servicer,
____________________, as Originator and the Trustee dated as of
___________,
200_.
"Insurance Proceeds" shall mean proceeds paid by any insurer
pursuant to any insurance policy covering a Mortgage Loan to the
extent such
proceeds are not applied to the restoration of the related
Mortgaged Property or
released to the related Mortgagor in accordance with Accepted
Servicing
Practices. "Insurance Proceeds" do not include "Insured
Payments."
["Insured Payment" shall have the meaning assigned thereto in
the
Certificate Insurance Policy.]
"Interest Determination Date" shall mean, with respect to
any
Accrual Period applicable to the Class A-1 Certificates, the
second LIBOR
Business Day preceding the first day of such Accrual Period.
"Interest Distribution Amount" shall mean for any Remittance
Date,
the sum of the Class A-1 Interest Distribution Amount, the Class
A-2 Interest
Distribution Amount, the Class A-3 Interest Distribution Amount
and the Class
A-4 Interest Distribution Amount.
"Late Payment Rate" shall have the meaning assigned thereto in
the
Insurance Agreement.
"LIBOR" shall mean, for any Interest Period other than the
first
Interest Period, the rate for United States dollar deposits for
one month that
appears on the Telerate Page 3750 as of 11:00 a.m., London,
England time, on the
second LIBOR Business Day prior to the first day of such
Interest Period. With
respect to the first Interest Period, "LIBOR" shall mean the
rate for United
States dollar deposits for one month that appears on the
Telerate Page 3750 as
of 11:00 a.m., London, England time, two LIBOR Business Days
prior to the
Closing Date. If such rate does not appear on such page (or such
other page as
may replace such page on such service, or if such service is no
longer offered,
such other service for displaying LIBOR or comparable rates as
may be reasonably
selected by the Trustee after consultation with the Master
Servicer), the rate
will be the Reference Bank Rate. If no such quotations can be
obtained and no
Reference Bank Rate is available, LIBOR will be LIBOR applicable
to the
preceding Remittance Date.
The establishment of LIBOR on each Interest Determination Date
by
the Trustee and the Trustee's calculation of the rate of
interest applicable to
the Class A-1 Certificates for the related Accrual Period shall
(in the absence
of manifest error) be final and binding. Each such rate of
interest may be
obtained by telephoning the Trustee.
"LIBOR Business Day" shall mean any day other than (i) a
Saturday or
a Sunday or (ii) a day on which banking institutions in the city
of London,
England are required or authorized by law to be closed.
"Liquidated Loan Loss" shall mean, with respect to any
Remittance
Date, the aggregate of the amount of losses with respect to each
Mortgage Loan
which became a Liquidated Mortgage Loan in the Due Period prior
to such
Remittance Date, equal to the excess of (i) the unpaid principal
balance of each
such Liquidated Mortgage Loan, plus accrued interest
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<PAGE>
thereon in accordance with the amortization schedule at the time
applicable
thereto at the applicable Mortgage Interest Rate from the Due
Date as to which
interest was last paid with respect thereto through the last day
of the month in
which such Mortgage Loan became a Liquidated Mortgage Loan, over
(ii) Net
Liquidation Proceeds with respect to such Liquidated Mortgage
Loan.
"Liquidated Mortgage Loan" shall mean a Mortgage Loan (i)
with
respect to which the related Mortgaged Property has been
acquired, liquidated
and/or foreclosed upon by the Master Servicer or (ii) which the
Master Servicer
has elected to write down the outstanding principal balance of
such Mortgage
Loan that has been delinquent for a period equal to or greater
than 270 days to
zero and, in either case, with respect to which the Master
Servicer determines
that all Liquidation Proceeds which it expects to recover have
been recovered.
"Liquidation Expenses" shall mean expenses incurred by the
Master
Servicer in connection with the liquidation of any defaulted
Mortgage Loan, REO
Mortgage Loan or REO Property (including, without limitation,
legal fees and
expenses, committee or referee fees, and, if applicable,
brokerage commissions
and conveyance taxes), any unreimbursed amount expended by the
Master Servicer
pursuant to Sections 5.5, 5.6 and 5.12 respecting the related
Mortgage Loan and
any unreimbursed expenditures for real property taxes or for
property
restoration or preservation of the related Mortgaged Property.
Liquidation
Expenses shall not include any previously incurred expenses in
respect of an REO
Mortgage Loan which have been netted against related REO
Proceeds.
"Liquidation Proceeds" shall mean amounts received (or, in the
case
of Liquidated Mortgage Loans written-down by the Master
Servicer, amounts
deposited) by the Master Servicer (including Insurance Proceeds)
in connection
with the liquidation of defaulted or written-down Mortgage Loans
or property
acquired in respect thereof, whether through foreclosure, sale
or otherwise,
including payments in connection with such Mortgage Loans
received from the
Mortgagor, other than amounts required to be paid to the
Mortgagor pursuant to
the terms of the applicable Mortgage or to be applied otherwise
pursuant to law.
"Loan Repurchase Price" shall have the meaning defined in
Section
2.4(c).
"Majority Certificateholders" shall mean the Holder or Holders
of
Class A Certificates evidencing an undivided beneficial
ownership interest in
the Class A Certificates in excess of 50% in the aggregate.
"Master Servicer" shall mean ___________________, an
___________________, or any successor appointed as herein
provided.
"Master Servicer Account" shall mean the account created and
maintained pursuant to Section 5.7.
"Master Servicer Employees" shall have the meaning as defined
in
Section 5.8 hereof.
"Master Servicer Remittance Amount" shall mean, with respect to
any
Determination Date, an amount equal to the sum of (i) all
unscheduled
collections of principal
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<PAGE>
and interest on the Mortgage Loans (including Principal
Prepayments and any
prepayment penalties received in connection with such Principal
Prepayments or
Curtailments, Net REO Proceeds and Net Liquidation Proceeds, if
any, and any
amounts deposited in the Collection Account or Certificate
Account in connection
with the purchase of the Mortgage Loans) collected by the Master
Servicer during
the Due Period and all scheduled Monthly Payments due on the
Mortgage Loans on
the Due Date and received by the Master Servicer on or prior to
the _____
Business Day preceding the related Determination Date, plus (ii)
all Periodic
Advances made by the Master Servicer with respect to payments
due to be received
on the Mortgage Loans on the related Due Date plus (iii) the
amount of
Compensating Interest due with respect to Mortgage Loans with
respect to the
related Due Period, plus (iv) any other amounts required to be
placed in the
Collection Account with respect to Mortgage Loans by the Master
Servicer
pursuant to this Pooling and Servicing Agreement but excluding,
without
duplication, the following:
(a) amounts received on a particular Mortgage as late payments
of
principal or interest and respecting which the Master Servicer
has previously
made an unreimbursed Periodic Advance;
(b) the portion of Liquidation Proceeds used to reimburse
any
unreimbursed Periodic Advances by the Master Servicer;
(c) those portions of each payment of interest on a
particular
Mortgage Loan which represent the Servicing Fee;
(d) that portion of Liquidation Proceeds and REO Proceeds
which
represents any unpaid Servicing Fee;
(e) all income from Permitted Investments that is held in
the
Collection Account for the account of the Master Servicer;
(f) all amounts in respect of late fees, assumption fees,
fees
associated with prepayments other than prepayment penalties,
demand statement
fees, reconveyance and recording fees and other service related
fees;
(g) all other amounts which are explicitly reimbursable to
the
Master Servicer hereunder with respect to the Mortgage Loans,
including (1) as
provided in Section 5.4 hereof; and (2) any unreimbursed and
accrued Liquidation
Expenses; and
(h) the portion of Net Foreclosure Profits representing any
unpaid
Servicing Fee.
"Master Servicer Termination Delinquency Rate Trigger" shall
have
the meaning assigned thereto in the [Insurance Agreement].
"Master Servicer Termination Loss Trigger" shall have the
meaning
assigned thereto in the [Insurance Agreement.]
"Monthly Payment" shall mean, as to any Mortgage Loan (including
any
REO Mortgage Loan) and any Due Date, the scheduled payment of
principal and
interest due thereon
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<PAGE>
by such Due Date (after adjustment for any Curtailments and
Deficient Valuations
occurring prior to such Due Date but before any adjustment to
such amortization
schedule by reason of any bankruptcy, other than Deficient
Valuations or similar
proceeding or any moratorium or similar waiver or grace
period).
"Mortgage" shall mean the mortgage, deed of trust or other
instrument creating a lien on the Mortgaged Property to secure
the Mortgage
Loan.
"Mortgage File" shall include the Mortgage Loan documents
described
in Section 2.3 hereof and such documents as are applicable from
those listed on
Exhibit C attached hereto.
"Mortgage Interest Rate" shall mean, as to any Mortgage Loan,
the
per annum rate at which interest accrues on the unpaid principal
balance thereof
as set forth in the related Mortgage Note.
"Mortgage Loan" shall mean (i) each mortgage loan identified on
the
Mortgage Loan Schedule on the Closing Date secured by a lien on
the related
Mortgaged Property, (ii) any additional mortgage loans
identified on the
Mortgage Loan Schedule after the Closing Date, as such schedule
is amended and
supplemented from time to time to reflect the deletion of the
Deleted Mortgage
Loans and the substitution of Qualified Substitute Mortgage
Loans for Deleted
Mortgage Loans, (iii) each Mortgage Note evidencing any loan
referred to in (i)
or (ii) above, including all amounts now or hereafter due under
such Mortgage
Notes, whether relating to such loans or other loans which may
be made from time
to time, and (iv) the related Mortgage. Unless otherwise clearly
indicated by
the context, Mortgage Loan shall be deemed to refer to the
related REO Mortgage
Loan and REO Property.
"Mortgage Loan Interest Shortfall" shall mean, with respect to
any
Remittance Date, as to any Mortgage Loan, any Prepayment
Interest Shortfall for
which no payment of Compensating Interest is paid.
"Mortgage Loan Sale Agreement" shall mean the Mortgage Loan
Sale
Agreement dated as of __________, 200_, between
____________________, as seller
thereunder, and ____________________, as purchaser thereunder,
as such agreement
may be amended, modified or supplemented from time to time.
"Mortgage Loan Schedule" shall mean the list of the Mortgage
Loans
transferred to the Trustee on the Closing Date as part of the
Trust Fund and
attached hereto as Exhibit D (and also provided to the
Certificate Insurer and
the Trustee on a computer readable magnetic tape or disk). The
Mortgage Loan
Schedule shall set forth at a minimum the following information
as to each
Mortgage Loan:
(a) the Mortgage Loan identifying number;
(b) the principal balance of the Mortgage Loan;
(c) the city, state and ZIP code of the Mortgaged Property;
(d) the type of property;
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<PAGE>
(e) the current Monthly Payment as of the Cut-Off Date;
(f) the original number of months to maturity;
(g) the scheduled maturity date;
(h) the Combined Loan-to-Value Ratio as of the Cut-Off Date;
(i) the Mortgage Interest Rate as of the Cut-Off Date;
(j) the Appraised Value;
(k) the documentation type (as described in the Underwriting
Guidelines); and
(l) the loan classification (as described in the
Underwriting
Guidelines).
Such "Mortgage Loan Schedule" may consist of multiple reports
that
collectively set forth all of the information required,
including the aggregate
number of Mortgage Loans and the Aggregate Principal Balance as
of the Cut-Off
Date. In addition, a summary of the information regarding the
Mortgage Loans
shall be included as a part of the Mortgage Loan Schedule which
summary shall
include such consolidated and aggregated information as may be
requested by the
Trustee [or the Certificate Insurer] from time to time.
"Mortgage Note" shall mean the original, executed note, loan
agreement or other evidence of indebtedness evidencing the
indebtedness of a
Mortgagor under a Mortgage Loan.
"Mortgaged Property" shall mean the underlying property securing
a
Mortgage Loan, consisting of a fee simple estate in a single
parcel of land
improved by a Residential Dwelling.
"Mortgagor" shall mean the obligor on a Mortgage Note.
"Net Foreclosure Profits" shall mean, as to any Remittance Date,
the
excess, if any, of (i) the aggregate Foreclosure Profits for
such Remittance
Date, over (ii) the Liquidated Loan Loss for such Remittance
Date.
"Net Liquidation Proceeds" shall mean, as to any Liquidated
Mortgage
Loan, Liquidation Proceeds net of Liquidation Expenses and net
of any
unreimbursed Periodic Advances made by the Master Servicer. For
all purposes of
this Agreement, Net Liquidation Proceeds shall be allocated
first to accrued and
unpaid interest on the related Mortgage Loan and then to the
unpaid principal
balance thereof.
"Net REO Proceeds" shall mean, as to any REO Mortgage Loan,
REO
Proceeds net of any related expenses of the Master Servicer.
"Nonrecoverable Advance" shall mean, with respect to any
Mortgage
Loan, (i) any Periodic Advance previously made and not
reimbursed from late
collections pursuant to Section 5.4(a), or (ii) a Periodic
Advance proposed to
be made in respect of a Mortgage Loan or
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REO Property either of which, in the good faith business
judgment of the Master
Servicer, as evidenced by an Officer's Certificate delivered to
[the Certificate
Insurer and] the Trustee no later than the Business Day
following such
determination, would not be ultimately recoverable pursuant to
Section 5.4.
"Officer's Certificate" shall mean a certificate signed by
the
Chairman of the Board, the President or a Vice President and the
Treasurer, the
Secretary or one of the Assistant Treasurers or Assistant
Secretaries of the
Transferor and/or the Master Servicer, or the Depositor, as
required by this
Agreement.
"Opinion Of Counsel" shall mean a written opinion of counsel,
who
may, without limitation, be counsel for the Transferor, the
Master Servicer, the
Trustee, a Certificateholder or a Certificateholder's
prospective transferee [or
the Certificate Insurer] (including, except as otherwise
provided herein,
in-house counsel) reasonably acceptable to each addressee of
such opinion and
experienced in matters relating to the subject of such opinion;
except that any
opinion of counsel relating to (i) the qualification of the 200_
- _ REMIC as a
REMIC, or (ii) compliance with the REMIC Provisions must be an
opinion of
counsel who (a) is in fact independent of the Transferor, the
Master Servicer
and the Trustee, (b) does not have any direct financial interest
or any material
indirect financial interest in the Transferor or the Master
Servicer or the
Trustee or in an Affiliate thereof, (c) is not connected with
the Transferor or
the Master Servicer or the Trustee as an officer, employee,
director or person
performing similar functions, [and (d) is reasonably acceptable
to the
Certificate Insurer.] [The Certificate Insurer shall be an
addressee on each
Opinion of Counsel relating to, or otherwise affecting, the
Series 200_ - _
Certificates].
"Optional Termination Date" shall mean the first date upon which
the
Aggregate Principal Balance is less than __% of the Aggregate
Principal Balance
as of the Cut-Off Date.
"Original Class A-1 Principal Balance" shall mean, as of the
Startup
Date and as to the Class A-1 Certificates, $__________.
"Original Class A-2 Principal Balance" shall mean, as of the
Startup
Date and as to the Class A-2 Certificates, $__________.
"Original Class A-3 Principal Balance" shall mean, as of the
Startup
Date and as to the Class A-3 Certificates, $__________.
"Original Class A-4 Principal Balance" shall mean, as of the
Startup
Date and as to the Class A-4 Certificates, $__________.
"Original Class A-5 Principal Balance" shall mean, as of the
Startup
Date and as to the Class A-5 Certificates, $__________.
"Originator" shall mean _____________________, a
__________________.
"Outstanding Mortgage Loan" shall mean, as to any Due Date,
a
Mortgage Loan (including an REO Mortgage Loan) which has not
been paid in full
prior to such Due Date,
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<PAGE>
which did not become a Liquidated Mortgage Loan prior to such
Due Date and which
was not repurchased by the Transferor prior to such Due Date
pursuant to
Sections 2.4 or 3.3.
"Overcollateralization Amount" shall mean, with respect to
any
Remittance Date, the excess, if any, of (i) the Aggregate
Principal Balance of
all Mortgage Loans as of the close of business on the last day
of the related
Due Period over (ii) (a) the sum of the Class A-1 Principal
Balance, Class A-2
Principal Balance, Class A-3 Principal Balance, Class A-4
Principal Balance and
the Class A-5 Principal Balance as of such Remittance Date
(after taking into
account Class A-5 Principal Distribution Amount, other than
the
Overcollateralization Increase Amount, for such Remittance
Date).
["Overcollateralization Deficiency Amount" shall mean, with
respect
to any date of determination, the excess, if any, of the
Overcollateralization
Target Amount over the Overcollateralization Amount.
"Overcollateralization Increase Amount" shall mean the lesser of
(i)
the related Excess Spread and (ii) the related
Overcollateralization Deficiency
Amount.
"Overcollateralization Target Amount" shall have the meaning
assigned thereto in the Insurance Agreement.
Notwithstanding the above, the Certificate Insurer may, in its
sole
discretion, modify the definition of Overcollateralization
Target Amount. The
Trustee and the Rating Agencies shall be notified in writing of
such
modification prior to the related Remittance Date and any such
modification
shall not result in a downgrading of the then-current ratings of
any Class A
Certificate without regard to the Certificate Insurance
Policy.]
"Owner-Occupied Mortgaged Property" shall mean a Residential
Dwelling as to which (i) the related Mortgagor represented an
intent to occupy
as such Mortgagor's primary, secondary or vacation residence at
the origination
of the Mortgage Loan, and (ii) the Transferor has no actual
knowledge that such
Residential Dwelling is not so occupied.
"Ownership Interest" shall mean, 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.
"Percentage Interest" shall mean, with respect to a Class
A-1
Certificate, Class A-2 Certificate, Class A-3 Certificate, Class
A-4 Certificate
or Class A-5 Certificate, the portion of the total beneficial
ownership interest
in the Mortgage Loans evidenced by such Certificate, expressed
as a percentage
rounded to four decimal places, equal to a fraction the
numerator of which is
the original denomination of such Certificate and the
denominator of which is
the Original Class A-1 Principal Balance, the Original Class A-2
Principal
Balance, the Original Class A-3 Principal Balance or the
Original Class A-4
Principal Balance as applicable. With respect to a Class R
Certificate, the
portion evidenced thereby as stated on the face of such
Certificate.
"Periodic Advance" shall mean the aggregate of the advances
required
to be made by the Master Servicer on any Determination Date
pursuant to Section
5.20 hereof, the amount
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of any such advances being equal to the sum of: (i) all Monthly
Payments (net of
the related Servicing Fee and any amount excluded from the
Master Servicer
Remittance Amount pursuant to clauses (a)-(h) of the definition
of "Master
Servicer Remittance Amount") on the Mortgage Loans that are not
received by the
Master Servicer as of the close of business on the second
Business Day preceding
the related Determination Date and have not been determined by
the Master
Servicer to be Nonrecoverable Advances, plus (ii) with respect
to each REO
Property which was acquired during or prior to the related Due
Period and as to
which an REO Disposition did not occur during the related Due
Period, an amount
equal to the excess, if any, of (a) interest on the principal
balance of the
related REO Mortgage Loan at the related Mortgage Interest Rate,
net of the
Servicing Fee, for the most recently ended Due Period for the
related Mortgage
Loan over (b) the net income from the REO Property transferred
to the
Certificate Account for such Remittance Date.
"Permitted Investments" shall mean any one or more of the
following
obligations or securities acquired at a purchase price of not
greater than par,
regardless of whether issued by the Servicer, the Trustee or any
of their
respective Affiliates:
(i) direct obligations of, or obligations fully guaranteed
as
to timely payment of principal and interest by, the United
States or
any agency or instrumentality thereof, provided such obligations
are
backed by the full faith and credit of the United States;
(ii) demand and time deposits in, certificates of deposit
of,
or bankers' acceptances (which shall each have an original
maturity
of not more than 90 days and, in the case of bankers'
acceptances,
shall in no event have an original maturity of more than 365
days or
a remaining maturity of more than 30 days) denominated in
United
States dollars and issued by, any Depository Institution and
rated
____ by _______, ____ by ______ and ___ by ______;
(iii) repurchase obligations with respect to any security
described in clause (i) above entered into with a Depository
Institution (acting as principal);
(iv) securities bearing interest or sold at a discount that
are issued by any corporation incorporated under the laws of
the
United States of America or any state thereof and that are rated
by
each Rating Agency that rates such securities in its highest
long-term unsecured rating categories at the time of such
investment
or contractual commitment providing for such investment;
(v) commercial paper (including both non-interest-bearing
discount obligations and interest-bearing obligations payable
on
demand or on a specified date not more than 30 days after the
date
of acquisition thereof) that is rated by each Rating Agency
that
rates such securities in its highest short-term unsecured
debt
rating available at the time of such investment;
(vi) units of money market funds, including money market
funds
managed or advised by the Depositor or the Trustee or an
Affiliate
thereof, that have been rated ____ by _______, ____ by ______
and
___ by ______; and
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(vii) if previously confirmed in writing to the Trustee, any
other demand, money market or time deposit, or any other
obligation,
security or investment, as may be acceptable to each of the
Rating
Agencies as a permitted investment of funds backing "____" or
"____"
rated securities;
provided, however, that no instrument described hereunder shall
evidence either
the right to receive (a) only interest with respect to the
obligations
underlying such instrument or (b) both principal and interest
payments derived
from obligations underlying such instrument and the interest and
principal
payments with respect to such instrument provide a yield to
maturity at par
greater than 120% of the yield to maturity at par of the
underlying obligations.
"Person" shall mean any individual, corporation, partnership,
joint
venture, association, limited liability company, joint-stock
company, trust,
unincorporated organization or government, or any agency or
political
subdivision thereof.
"Principal Distribution Amount" shall mean, with respect to
the
Class A-1 Certificates, the Class A-2 Certificates, the Class
A-3 Certificates
and the Class A-4 Certificates, for any Remittance Date, the
lesser of:
(a) the excess of (1) the sum of the Available Amount, any
Excess
Spread and the applicable portion of any Insured Payment over
(2) the Interest
Distribution Amount; and
(b) the sum, without duplication, of:
(i) that portion of all scheduled installments of principal
in
respect of the Mortgage Loans which is received (or advanced)
during the related
Due Period together with all unscheduled recoveries of principal
(including
Principal Prepayments, Curtailments and Deficient Valuations) on
such Mortgage
Loans actually collected by the Master Servicer during the prior
calendar month,
(ii) the principal balance of each Mortgage Loan that either
was,
effective on such Remittance Date, repurchased by the Transferor
or by the
Depositor or purchased by the Master Servicer during the
preceding Due Period,
but only to the extent the amount equal to such principal
balance is actually
received by the Trustee,
(iii) any Substitution Adjustment amounts delivered by the
Depositor
on the related Remittance Date in connection with a substitution
of a Mortgage
Loan, to the extent such Substitution Adjustments are actually
received by the
Trustee,
(iv) with respect to each Mortgage Loan that became a
Liquidated
Mortgage Loan during the prior calendar month, the principal
balance of such
Mortgage Loan immediately prior to the time when such Mortgage
Loan became a
Liquidated Mortgage Loan,
(v) any Overcollateralization Increase Amount,
(vi) to the extent of any Subordination Deficit the excess, if
any
of the sum of the Class A-1 Principal Balance, Class A-2
Principal Balance,
Class A-3 Principal Balance, Class A-
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4 Principal Balance and Class A-5 Principal Balance over the
Aggregate Principal
Balance of the Mortgage Loans,
(vii) the portion of the proceeds relating to the Mortgage
Loans
received by the Trust Fund following any termination of the 200_
- _ REMIC
carried out in accordance with a plan of complete liquidation
pursuant to
Section 8.2 hereof or pursuant to the optional termination of
any of the Trust
Fund, the 200_ - _ REMIC Trust Fund by either the Master
Servicer [or
Certificate Insurer] in accordance with Section 8.1 hereof, up
to the then
outstanding Class A-1 Principal Balance, Class A-2 Principal
Balance, Class A-3
Principal Balance and/or Class A-4 Principal Balance, as
applicable minus
(viii) any overcollateralization release amount.
"Principal Prepayment" shall mean any payment or other recovery
of
principal on a Mortgage Loan equal to the outstanding principal
balance thereof,
received in advance of the final scheduled Due Date which is not
intended as an
advance payment of a scheduled Monthly Payment.
"Proportional Share" shall mean, (a) the sum of the Class
A-1
Principal Balance, Class A-2 Principal Balance, Class A-3
Principal Balance,
Class A-4 Principal Balance and the Class A-5 Principal Balance
divided by (b)
the Certificate Principal Balance.
"Purchase and Sale Agreement" shall mean the Purchase and
Sale
Agreement, dated as of the date hereof, between the Transferor
and the Depositor
and relating to the sale of the Mortgage Loans to the
Depositor.
"Qualified Mortgage" shall have the meaning set forth from time
to
time in the definition of "Qualified Mortgage" at Section
860G(a)(3) of the Code
(or any successor statute thereto).
"Qualified Substitute Mortgage Loan" shall mean a mortgage loan
or
mortgage loans which (i) has or have an interest rate at least
equal to the
Deleted Mortgage Loan for which it is to be substituted, (ii)
relates or relate
to a detached one-family residence or to the same type of
Residential Dwelling
as the Deleted Mortgage Loan for which it is to be substituted
and in each case
has or have the same occupancy status or is an Owner-Occupied
Mortgaged
Property, (iii) matures or mature no later than (and not more
than one year
earlier than) the Deleted Mortgage Loan for which it is to be
substituted, (iv)
has or have a Combined Loan-to-Value Ratio or Combined
Loan-to-Value Ratios at
the time of such substitution no higher than the Combined
Loan-to-Value Ratio of
the Deleted Mortgage Loan for which it is to be substituted, (v)
has or have a
principal balance or principal balances (after application of
all payments
received on or prior to the date of substitution) not
substantially less and not
more than the principal balance of the Deleted Mortgage Loan for
which it is to
be substituted as of such date, (vi) satisfies or satisfy the
criteria set forth
from time to time in the definition of "qualified replacement
mortgage" at
Section 860G(a)(4) of the Code (or any successor statute
thereto), (vii) has or
have an applicable borrower or borrowers with the same or better
traditionally
ranked credit status as the borrower or borrowers under the
Deleted Mortgage
Loan for which it is to be
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substituted, and (viii) complies or comply as of the date of
substitution with
each representation and warranty set forth in Sections 3.1 and
3.2 of the
Purchase and Sale Agreement.
"Rating Agency" shall mean _______ or _______.
"Record Date" shall mean, with respect to any Remittance Date
other
than the initial Remittance Date, the close of business on the
____ day of the
calendar month immediately preceding the month in which such
Remittance Date
occurs and with respect to the initial Remittance Date, the
Closing Date.
"Reference Bank Rate" shall mean, with respect to any
Interest
Period, as follows: the arithmetic mean (rounded upwards, if
necessary, to the
nearest one sixteenth of one percent) of the offered rates for
United States
dollar deposits for one month which are offered by the Reference
Banks as of
11:00 a.m., London, England time, on the second LIBOR Business
Day prior to the
first day of such Interest Period to prime banks in the London
interbank market
for a period of one month in amounts approximately equal to the
then outstanding
Certificate Principal Balance; provided, that at least two such
Reference Banks
provide such rate. If fewer than two offered rates appear, the
Reference Bank
Rate will be the arithmetic mean of the rates quoted by one or
more major banks
in New York City, selected by the Trustee after consultation
with the Master
Servicer, as of 11:00 a.m., New York time, on such date for
loans in U.S.
Dollars to leading European Banks for a period of one month in
amounts
approximately equal to the then outstanding Certificate
Principal Balance. If no
such quotations can be obtained, the Reference Bank Rate will be
the Reference
Bank Rate applicable to the preceding Interest Period.
"Reference Banks" shall mean _________________,
_________________,
_________________ and _________________; provided that if any of
the foregoing
banks are not suitable to serve as a Reference Bank, then any
leading banks
selected by the Trustee which are engaged in transactions in
Eurodollar deposits
in the international Eurocurrency market (i) with an established
place of
business in London, (ii) not controlling, under the control of
or under common
control with the Depositor or any affiliate thereof, (iii) whose
quotations
appear on the Reuters Screen LIBOR Page on the relevant Interest
Determination
Date and (iv) which have been designated as such by the Trustee
after
consultation with the Master Servicer.
["Reimbursement Amount" shall mean, as of any Remittance Date,
the
sum of (i) all Insured Payments previously paid by the
Certificate Insurer and
in each case not previously repaid to the Certificate Insurer
pursuant to
Section 6.5(a)(vii) hereof plus (ii) interest accrued on such
Insured Payments
not previously repaid calculated at the Late Payment Rate from
the date such
Insured Payment was paid, plus (iii) any amounts then due and
owing to the
Certificate Insurer under the Insurance Agreement, as certified
to the Trustee
by the Certificate Insurer, plus (iv) interest on such amounts
at the Late
Payment Rate. The Certificate Insurer shall notify the Trustee
and the Depositor
of the amount of any Reimbursement Amount.]
"Released Mortgaged Property Proceeds" shall mean, as to any
Mortgage Loan, proceeds received by the Master Servicer in
connection with (i) a
taking of an entire Mortgaged Property by exercise of the power
of eminent
domain or condemnation or (ii) any release of part of the
Mortgaged Property
from the lien of the related Mortgage, whether by partial
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condemnation, sale or otherwise; which are not released to the
Mortgagor in
accordance with applicable law, Accepted Servicing Practices and
this Agreement.
"REMIC" shall mean a "real estate mortgage investment
conduit
"within the meaning of Section 860D of the Code.
"REMIC Change Of Law" shall mean any proposed, temporary or
final
regulation, revenue ruling, revenue procedure or other official
announcement or
interpretation relating to the REMIC and the REMIC Provisions
issued after the
Closing Date.
"REMIC Provisions" shall mean provisions of the federal income
tax
law relating to real estate mortgage investment conduits, which
appear at
Sections 860A through 860G of Subchapter M of Chapter I of the
Code, and related
provisions, and temporary and final regulations promulgated
thereunder and
published rulings, notices and announcements, as the foregoing
may be in effect
from time to time.
"Remittance Date" shall mean the ____ day of any month or if
such
____ day is not a Business Day, the first Business Day
immediately following,
commencing on ________, 200_
"REO Disposition" shall mean the final sale by the Master
Servicer
of a Mortgaged Property acquired by the Master Servicer in
foreclosure or by
deed in lieu of foreclosure.
"REO Mortgage Loan" shall mean any Mortgage Loan that 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 Proceeds" shall mean proceeds received in respect of any
REO
Mortgage Loan (including, without limitation, proceeds from the
rental of the
related Mortgaged Property).
"REO Property" shall have the meaning described in Section
5.12.
"Representation Letter" shall mean letters to, or agreements
with,
the Depository to effectuate a book entry system with respect to
the Class A
Certificates registered in the Certificate Register under the
nominee name of
the Depository.
"Request For Release" shall mean a request for release in
substantially the form attached as Exhibit H hereto.
"Residential Dwelling" shall mean a one- to four-family
dwelling, a
unit in a planned unit development, a unit in a condominium
development, a
townhouse or a manufactured housing unit.
"Responsible Officer" shall mean, when used with respect to
the
Trustee, any officer assigned to the Corporate Trust Division
(or any successor
thereto), including any Vice President, Senior Trust Officer,
Trust Officer,
Assistant Trust Officer, any Assistant Secretary, any trust
officer or any other
officer of the Trustee customarily performing functions similar
to
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those performed by any of the above designated officers and to
whom, with
respect to a particular matter, such matter is referred because
of such
officer's knowledge of and familiarity with the particular
subject. When used
with respect to the Transferor or the Master Servicer, the
President or any Vice
President, Assistant Vice President, or any Secretary or
Assistant Secretary.
"Series" shall mean any designated Series of certificates
issued
hereunder and governed by this Agreement. When used herein,
"this Series" shall
refer to the _______ Home Equity Asset Backed Certificates,
Series 200_ - _.
"Servicing Advances" shall mean all reasonable and customary
"out-of-pocket" costs and expenses incurred in the performance
by the Master
Servicer of its servicing obligations, including, but not
limited to, the cost
of (i) the preservation, restoration and protection of the
Mortgaged Property,
(ii) any enforcement proceedings, including foreclosures, (iii)
expenditures
relating to the purchase or maintenance of a first or second
lien not included
in the Trust Fund on the Mortgaged Property, (iv) the management
and liquidation
of the REO Property, including reasonable fees paid to any
independent
contractor in connection therewith, (v) compliance with the
obligations
(including indemnification obligations) under Sections 5.2
(limited solely to
the reasonable and customary out-of-pocket expenses of the
Subservicer), 5.5,
5.6 or 5.9, all of which reasonable and customary out-of-pocket
costs and
expenses are reimbursable to the Master Servicer to the extent
provided in
Section 5.4(a).
"Servicing Compensation" shall mean the Servicing Fee and
other
amounts to which the Master Servicer is entitled pursuant to
Section 5.14.
"Servicing Fee" shall mean, as to each Mortgage Loan, the annual
fee
payable to the Master Servicer, which is calculated as an amount
equal to the
product of (i) 0.50% per annum in the case of any Mortgage Loan
that is first
priority Mortgage Loan as of the Cut-Off Date and ____% in the
case of any other
Mortgage Loan, or up to ____% or ____% respectively in the event
that
____________________ is succeeded by the Trustee or any other
successor Master
Servicer appointed as herein provided, and (ii) the principal
balance thereof.
Such fee shall be calculated and payable monthly only on amounts
actually
received in respect of interest on such Mortgage Loan and shall
be computed on
the basis of the same principal amount and for the period
respecting which any
related interest payment on a Mortgage Loan is computed. The
Servicing Fee
includes any servicing fees owed or payable to any
Subservicer.
"Servicing Officer" shall mean any officer of the Master
Servicer or
the Originator involved in, or responsible for, the
administration and servicing
of the Mortgage Loans whose name and specimen signature appear
on a list of
servicing officers furnished to the Trustee [and the Certificate
Insurer] by the
Master Servicer, as such list may from time to time be
amended.
"Startup Date" shall mean the day designated as such pursuant
to
Section 2.5 hereof.
"Subordination Deficit" shall mean, with respect to any
Remittance
Date, the excess, if any, of (i) the aggregate of the
Certificate Principal
Balance on such Remittance Date,
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after taking into account the payment of the Principal
Distribution Amount on
such Remittance Date [(except for amounts payable under the
Certificate
Insurance Policy)] over (ii) the Aggregate Principal Balance as
of the end of
the related Due Period.
"Subservicer" shall mean any Person with whom the Master
Servicer
has entered into a Subservicing Agreement and who satisfies the
requirements set
forth in Section 5.2(a) hereof in respect of the qualification
of a Subservicer.
"Subservicing Agreement" shall mean any agreement between the
Master
Servicer and any Subservicer relating to subservicing and/or
administration of
certain Mortgage Loans as provided in Section 5.2(b), a copy of
which shall be
delivered, along with any modifications thereto, to the Trustee
and the
Certificate Insurer.
"Substitution Adjustment" shall mean, as to any date on which
a
substitution occurs pursuant to Section 2.4 or 3.3, the amount
(if any) by which
the aggregate principal balances (after application of principal
payments
received on or before the date of substitution of any Qualified
Substitute
Mortgage Loans as of the date of substitution) are less than the
aggregate of
the principal balances of the related Deleted Mortgage Loans
together with 30
days' interest thereon at the Mortgage Interest Rate.
"Tax Matters Person" shall mean the Person or Persons
appointed
pursuant to Section 10.15 from time to time to act as the "tax
matters person"
(within the meaning of the REMIC Provisions) of the 200_ - _
REMIC.
"Tax Return" shall mean the federal income tax return on
Internal
Revenue Service Form 1066, "U.S. Real Estate Mortgage Investment
Conduit Income
Tax Return," including Schedule Q thereto, Quarterly Notice to
Residual Interest
Holders of REMIC Taxable Income or Net Loss Allocation, or any
successor forms,
to be filed on behalf of the Trust Fund due to its
classification as a REMIC
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 provision of federal, state or
local tax laws.
"Telerate Page 3750" shall mean the display page so designated
on
the Bridge Telerate Service (or such other page as may replace
page 3750 on such
service for the purpose of displaying London interbank offered
rates of major
banks). If such rate does not appear on such page (or such other
page as may
replace such page on such service, or if such service is no
longer offered, such
other service for displaying LIBOR or comparable rates as may be
selected by the
Issuer after consultation with the Trustee), the rate will be
the Reference Bank
Rate.
"Transfer" shall mean any direct or indirect transfer, sale,
pledge,
hypothecation or other form of assignment of any Ownership
Interest in a
Certificate.
"Transfer Affidavit And Agreement" shall have the meaning as
defined
in Section 4.2(i)(ii).
"Transferee" shall mean any Person who is acquiring by Transfer
any
Ownership Interest in a Certificate.
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"Transferor" shall mean ____________________, a Delaware
corporation.
"Trust" shall mean _______ Home Equity Trust 200_ - _, the
trust
created hereunder.
"Trust Fund" shall mean (i) each Mortgage transferred to the
Trust
pursuant to the provisions hereof, (ii) all rights of or
assigned to the
Depositor under the Purchase and Sale Agreement (and exclusive
of any of its
obligations), (iii) such assets as from time to time are
identified as REO
Property and collections thereon and proceeds thereof, (iv) all
assets deposited
in the Accounts, including any amounts on deposit in the
Collection Account, the
Trustee Collection Account, and the Certificate Account and all
amounts in the
Accounts invested in Permitted Investments, (v) the Trustee's
rights with
respect to the Mortgage Loans under all insurance policies
(other than the
Certificate Insurance Policy) required to be maintained pursuant
to this
Agreement and any Insurance Proceeds, (vi) all Liquidation
Proceeds and (vii)
all Released Mortgaged Property Proceeds and (viii) all rights
against the
Transferor arising under the Purchase and Sale Agreement.
"Trustee" shall mean _____________________, or its successor
in
interest, or any successor trustee appointed as herein
provided.
"Trustee Collection Account" shall mean any Eligible Account
established and maintained by the Trustee for the benefit of
the
Certificateholders pursuant to Section 5.3(a) hereof.
"Trustee Fee" shall mean, as to any Remittance Date, the fee
payable
to the Trustee in respect of its services as Trustee that
accrues at a monthly
rate equal to 1/12 of _____% of the Certificate Principal
Balance as of such
Remittance Date together with its out-of-pocket expenses,
including, without
limitation, any costs or expenses associated with the complete
transfer of all
servicing data and the completion, correction or manipulation of
such servicing
data as may be required by the Trustee to correct any errors or
insufficiencies
in the servicing data or otherwise enable the Trustee to service
the Mortgage
Loans properly and effectively.
"Trustee's Mortgage File" shall mean the documents delivered to
the
Trustee or its designated agent pursuant to Section 2.3.
"Trustee's Remittance Report" shall have the meaning as defined
in
Section 6.7.
"Underwriter" shall mean __________________ and
__________________.
"Underwriting Guidelines" shall mean the underwriting guidelines
of
the Transferor, ____________________ and of the Originator, a
copy of which is
attached as an exhibit to the Purchase and Sale Agreement.
"United States Person" shall mean a beneficial owner of a
Certificate that is for United States federal income tax
purposes (i) a citizen
or resident of the United States, (ii) a corporation,
partnership or other
entity created or organized in or under the laws of the United
States or of any
political subdivision thereof (other than a partnership that is
not treated as a
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United States person under any applicable Treasury regulations),
(iii) an estate
whose income is subject to United States federal income tax
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 the authority to control all substantial
decisions of the
trust.
"Unpaid REO Amortization" shall mean, as to any REO Mortgage
Loan
and any month, the aggregate of the installments of principal
and accrued
interest deemed to be due in such month and in any prior months
that remain
unpaid, calculated in accordance with Section 5.12.
"Weighted Average Rate Cap" shall mean with respect to the Class
A-1
Certificates, on any Remittance Date, that maximum interest rate
computed to
equal one-twelfth the weighted average Mortgage Interest Rate
for the Mortgage
Loans, net of the premium percentage and] the rates at which the
Servicing Fee
and the Trustee's Fee are calculated.
Section 1.2 Provisions Of General Application.
(a) All accounting terms not specifically defined herein shall
be
construed in accordance with generally accepted accounting
principles.
(b) The terms defined in this Article include the plural as well
as
the singular.
(c) The words "herein," "hereof" and "hereunder" and other words
of
similar import refer to this Agreement as a whole. All
references to Articles
and Sections shall be deemed to refer to Articles and Sections
of this
Agreement.
(d) Reference to statutes are to be construed as including
all
statutory provisions consolidating, amending or replacing the
statute to which
reference is made and all regulations promulgated pursuant to
such statutes.
(e) All calculations of interest relating to the Class A-1
Certificates (other than with respect to the Mortgage Loans, or
as otherwise
specifically set forth herein) provided for herein shall be made
on the basis of
actual days elapsed divided by a year comprised of 360 days. All
calculations of
interest relating to the Class A-2 Certificates, Class A-3
Certificates, Class
A-4 Certificates or Class A-5 Certificates (other than with
respect to the
Mortgage Loans, or as otherwise specifically set forth herein)
provided for
herein, shall be made on the basis of an assumed year of 360
days consisting of
twelve 30 day months. All calculations of interest with respect
to any Mortgage
Loan provided for herein shall be made in accordance with the
terms of the
related Mortgage Note and Mortgage or, if such documents do not
specify the
basis upon which interest accrues thereon, on the basis of
dividing actual days
elapsed by a 365-day year.
(f) Any Mortgage Loan payment is deemed to be received on the
date
such payment is actually received by the Master Servicer;
provided, however,
that for purposes of calculating distributions on the
Certificates prepayments
with respect to any Mortgage Loan are deemed to be received on
the date they are
applied in accordance with customary servicing practices
consistent with the
terms of the related Mortgage Note and Mortgage to reduce the
outstanding
principal balance of such Mortgage Loan on which interest
accrues.
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ARTICLE II
ESTABLISHMENT OF THE TRUST;
SALE AND CONVEYANCE OF TRUST FUND
Section 2.1 Sale And Conveyance Of Trust Fund; Priority And
Subordination Of Ownership Interests; Establishment Of The
Trust.
(a) The Depositor does hereby sell, transfer, assign, set over
and
convey to the Trust for the benefit of the Certificateholders
[and the
Certificate Insurer] without recourse but subject to the
provisions in this
Section 2.1 and the other terms and provisions of this
Agreement, all of the
right, title and interest of the Depositor in and to the Trust
Fund, exclusive
of the obligations of the Depositor, Transferor or any other
party with respect
to the Mortgage Loans. In connection with such transfer and
assignment, and
pursuant to Section 2.5 of the Purchase and Sale Agreement, the
Depositor does
hereby also irrevocably transfer, assign, set over and otherwise
convey to the
Trustee all of its rights (exclusive of its obligations) under
the Purchase and
Sale Agreement, including, without limitation, its right to
exercise the
remedies created by Section 3.4 of the Purchase and Sale
Agreement for breaches
of representations and warranties, agreements and covenants of
the Transferor
contained in Sections 3.1 and 3.2 of the Purchase and Sale
Agreement.
(b) The rights of the Certificateholders to receive payments
with
respect to the Mortgage Loans in respect of the Certificates and
all ownership
interests of the Certificateholders, shall be as set forth in
this Agreement. In
this regard, all rights of the Class R Certificateholders to
receive payments in
respect of the Class R Certificates, are subject and subordinate
to the
preferential rights of the Class A Certificateholders to receive
payments in
respect of the Class A Certificates and to the Certificate
Insurer's rights to
receive the Reimbursement Amount.
(c) The Depositor does hereby establish, pursuant to the
further
provisions of this Agreement and the laws of the State of New
York, an express
trust to be known, for convenience, as "_______ HOME EQUITY
TRUST 200_ - _" and
does hereby appoint ____________________ as Trustee in
accordance with the
provisions of this Agreement.
Section 2.2 Possession Of Mortgage Files; Access To Mortgage
Files.
(a) Upon the issuance of the Certificates, the ownership of
each
Mortgage Note, the Mortgage and the contents of the related
Mortgage File
related to each Mortgage Loan shall be vested in the Trustee for
the benefit of
the Certificateholders [and the Certificate Insurer, as their
respective
interests may appear].
(b) Pursuant to Section 2.4 of the Mortgage Loan Sale
Agreement,
____________________ has delivered or caused to be delivered the
Trustee's
Mortgage File related to each Mortgage Loan to the Trustee.
(c) The Trustee may enter into a custodial agreement pursuant
to
which the Trustee will appoint a custodian (a "Custodian") to
hold the Mortgage
Files in trust for the benefit of the Trustee; provided,
however, that the
custodian so appointed shall in no event be the
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Depositor, the Transferor or the Master Servicer or any Person
known to a
Responsible Officer of the Trustee to be an Affiliate of any of
them.
(d) The Custodian shall afford the Depositor[, the
Certificate
Insurer and] the Master Servicer reasonable access to all
records and
documentation regarding the Mortgage Loans relating to this
Agreement, such
access being afforded at customary charges, upon reasonable
request and during
normal business hours at the offices of the Custodian.
Section 2.3 Delivery Of Mortgage Loan Documents.
(a) In connection with each conveyance pursuant to Section 2.1
or
2.2 hereof, the Depositor has delivered or does hereby agree to
deliver or cause
to be delivered to the Trustee [the Certificate Insurance Policy
and] each of
the following documents for each Mortgage Loan sold by the
Transferor to the
Depositor and sold by the Depositor to the Trust Fund:
(i) The original Mortgage Note, endorsed by the holder of
record
without recourse in the following form: "Pay to the order of
___________,
without recourse" and signed by manual or facsimile signature in
the name
of an authorized officer of the holder of record,
____________________,
and if by the Transferor, by an authorized officer;
(ii) The original Mortgage with evidence of recording
indicated
thereon; provided, however, that if such Mortgage has not been
returned
from the applicable recording office, then such recorded
Mortgage shall be
delivered when so returned;
(iii) An assignment of the original Mortgage, in suitable form
for
recordation in the jurisdiction in which the related Mortgaged
Property is
located, in the name of the holder of record of the Mortgage
Loan by an
authorized officer (with evidence of submission for recordation
of such
assignment in the appropriate real estate recording office for
such
Mortgaged Property to be received by the Trustee within 60 days
of the
Closing Date); provided, however, that Assignments of Mortgages
shall not
be required to be submitted for recording with respect to any
Mortgage
Loan which relates to the Trustee's Mortgage File if the
Trustee, each of
the Rating Agencies [and the Certificate Insurer] shall have
received an
opinion of counsel satisfactory to the Trustee, each of the
Rating
Agencies [and the Certificate Insurer] stating that, in such
counsel's
opinion, the failure to record such Assignment of Mortgage shall
not have
a materially adverse effect on the security interest of the
Trustee in the
Mortgage); provided, further, that any Assignment of Mortgage
for which an
opinion has been delivered shall be recorded by the Master
Servicer upon
the earlier to occur of (a) [receipt by the Trustee of the
Certificate
Insurer's written direction to record such Mortgage,] (b) the
occurrence
of any Event of Default, as such term is defined in this
Agreement, or (c)
a bankruptcy or insolvency proceeding involving the Mortgagor is
initiated
or foreclosure proceedings are initiated against the Mortgaged
Property as
a consequence of an event of default under the Mortgage Loan;
provided,
however, that if the related Mortgage has not been returned from
the
applicable recording office within 120 days of the Closing Date,
then such
assignment shall be delivered when so returned (and a blanket
assignment
with respect to each unrecorded Mortgage shall be delivered on
the Closing
Date);
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<PAGE>
(iv) Any recorded intervening Assignments of the Mortgage
with
evidence of recording thereon; and
(v) Any assumption, modification, consolidation or extension
agreements;
provided, however, that in the case of any Mortgage Loans which
have been
prepaid in full after the Cut-Off Date and prior to the date of
the execution of
this Agreement, the Depositor, in lieu of delivering the above
documents, hereby
delivers to the Trustee a certification of an officer of the
Transferor of the
nature set forth in Exhibit M attached hereto; and provided,
further, however,
that as to certain Mortgages or assignments thereof which have
been delivered or
are being delivered to recording offices for recording and have
not been
returned to the Transferor in time to permit their delivery
hereunder at the
time of such transfer, in lieu of delivering such original
documents, the
Depositor is delivering to the Trustee a true copy thereof with
a certification
by the Transferor on the face of such copy substantially as
follows: "certified
true and correct copy of original which has been transmitted for
recordation."
The Transferor has agreed pursuant to the Purchase and Sale
Agreement that it
will deliver such original documents on behalf of the Depositor
to the Trustee
promptly after they are received, and no later than 90 days
after the Closing
Date; provided, however, that in those instances where the
public recording
office retains the original Mortgage or Assignment of Mortgage
after it has been
recorded or such original document has been lost by the
recording office, the
Transferor shall be deemed to have satisfied its obligations
hereunder if it
shall have delivered to the Trustee a copy of such original
Mortgage or
Assignment of Mortgage certified by the public recording office
to be a true
copy of the recorded original thereof. The Transferor has agreed
pursuant to the
Purchase and Sale Agreement, at its own expense, to record (or
to provide the
Trustee with evidence of recordation thereof) each assignment
within 60 days of
the Closing Date in the appropriate public office for real
property records,
provided that such assignments are redelivered by the Trustee to
the Transferor
upon the Transferor's written request and at the Transferor's
expense, unless
the Transferor (at its expense) furnishes to the Trustee[, the
Certificate
Insurer] and the Rating Agencies an unqualified Opinion of
Counsel reasonably
acceptable to the Trustee to the effect that recordation of such
assignment is
not necessary under applicable state law to preserve the
Trustee's interest in
the related Mortgage Loan against the claim of any subsequent
transferee of such
Mortgage Loan or any successor to, or creditor of, the
Transferor.
On or prior to the Closing Date the Master Servicer, at its
own
expense shall complete the endorsement of each Mortgage Note
such that the final
endorsement appears in the following form:
"Pay to the order of _________, without recourse,
___________________."
The Master Servicer, at its own expense shall also complete
each
Assignment of Mortgage either in blank or such that the final
Assignment of
Mortgage appears in the following form:
"____________________, as Trustee for _______ Home Equity Trust
200_
- _ formed pursuant to the Pooling and Servicing Agreement dated
as of
__________, 200_, among
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HSI Asset Securitization Corporation, as Depositor,
____________________, as
Transferor, ____________________, as Master Servicer and
____________________,
as Trustee"
(b) Without diminution of the requirements of Sections 2.2(c)
and
this Section 2.3, all original documents relating to the
Mortgage Loans that are
not delivered to the Trustee shall be delivered to the Master
Servicer by the
Transferor on behalf of the Depositor pursuant to the Purchase
and Sale
Agreement, and shall be held by the Master Servicer in trust for
the benefit of
the Trustee on behalf of the Certificateholders and the
Certificate Insurer. In
the event that any such original document is required pursuant
to the terms of
this Section 2.3 to be a part of a Mortgage File, the Master
Servicer shall
promptly deliver such original document to the Trustee. In
acting as custodian
of any such original document, the Master Servicer agrees
further that it does
not and will not have or assert any beneficial ownership
interest in the
Mortgage Loans or the Mortgage Files. Promptly upon the
Depositor's and the
Trust's acquisition thereof and the Master Servicer's receipt
thereof, the
Master Servicer on behalf of the Trust shall mark conspicuously
each original
document not delivered to the Trustee, and the Transferor's
master data
processing records evidencing each Mortgage Loan with a legend,
acceptable to
the Trustee [and the Certificate Insurer], evidencing that the
Trust has
purchased the Mortgage Loans and all right and title thereto and
interest
therein pursuant to the Purchase and Sale Agreement and this
Agreement.
(c) In the event that any Mortgage Note required to be
delivered
pursuant to this Section 2.3 is conclusively determined by any
of the
Transferor, the Master Servicer, the Custodian or the Trustee to
be lost, stolen
or destroyed, the Transferor shall, within 14 days of the
Closing Date or the
later date upon which such Mortgage Note has been conclusively
determined to be
lost, deliver to the Trustee a "lost note affidavit" in form and
substance
acceptable to the Trustee, and shall simultaneously therewith
request the
obligor on such Mortgage Note to execute and return a
replacement Mortgage Note,
and shall further agree to hold the Trustee [and the Certificate
Insurer]
harmless from any loss or damage resulting from any action taken
in reliance on
the delivery and possession by the Trustee of such lost note
affidavit. Upon the
receipt of such replacement Mortgage Note, the Trustee shall
return the lost
note affidavit. Delivery by the Transferor of such lost note
affidavit shall not
affect the obligations of the Transferor under the Purchase and
Sale Agreement
with respect to the related Mortgage Loan.
Section 2.4 Acceptance By Trustee Of The Trust Fund; Certain
Substitutions; Certification By Trustee.
(a) The Trustee agrees to execute and deliver to the Depositor[,
the
Certificate Insurer], the Master Servicer and the Transferor on
or prior to the
Closing Date [an acknowledgment of receipt of [the Certificate
Insurance Policy
and,] with respect to each initial Mortgage Loan, the original
Mortgage Note
(with any exceptions noted), in the form attached as Exhibit E
hereto and
declares that it will hold such documents and any amendments,
replacements or
supplements thereto, as well as any other assets included in the
definition of
Trust Fund and delivered to the Trustee, as Trustee in trust
upon and subject to
the conditions set forth herein for the benefit of the
Certificateholders [and
the Certificate Insurer].
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<PAGE>
(b) The Trustee agrees, for the benefit of the
Certificateholders [and the
Certificate Insurer], to review (or cause to be reviewed) each
Trustee's
Mortgage File within 45 Business Days after the Closing Date and
to deliver to
the Transferor, the Master Servicer, the Depositor [and the
Certificate Insurer]
a certification in the form attached hereto as Exhibit F to the
effect that, as
to each Mortgage Loan listed in Mortgage Loan Schedule (other
than any Mortgage
Loan paid in full or any Mortgage Loan specifically identified
in such
certification as not covered by such certification), (1) all
documents required
to be delivered to it pursuant to Section 2.3 hereof and the
Purchase and Sale
Agreement are in its possession, (2) each such document has been
reviewed by it,
has been, to the extent required, executed and has not been
mutilated, damaged,
torn or otherwise physically altered (handwritten additions,
changes or
corrections shall not constitute physical alteration if
initialed by the
Mortgagor), appears regular on its face and relates to such
Mortgage Loan. The
Trustee shall be under no duty or obligation to (1) inspect,
review or examine
any such documents, instruments, certificates or other papers to
determine that
they are genuine, enforceable, or appropriate for the
represented purpose or
that they are other than what they purport to be on their face
or (2) determine
whether any Trustee's Mortgage File should contain any of the
documents referred
to in Section 2.3(a)(v).
On or prior to the first anniversary of the Closing Date,
the
Trustee shall deliver (or cause to be delivered) to the Master
Servicer, the
Transferor, the Depositor [and the Certificate Insurer] a final
certification in
the form attached hereto as Exhibit G to the effect that, as to
each Mortgage
Loan listed in the Mortgage Loan Schedule (other than any
Mortgage Loan paid in
full or any Mortgage Loan specifically identified in such
certification as not
covered by such certification), and as to any document noted in
an exception
included in the Trustee's initial certification, (i) all
documents required to
be delivered to it pursuant to Section 2.3 hereof and the
Purchase and Sale
Agreement are in its possession, (ii) each such document has
been reviewed by
it, has been, to the extent required, executed and has not been
mutilated,
damaged, torn or otherwise physically altered (handwritten
additions, changes or
corrections shall not constitute physical alteration if
initialed by the
Mortgagor), appears regular on its face and relates to such
Mortgage Loan.
(c) If [the Certificate Insurer or] the Trustee during the
process
of reviewing the Trustee's Mortgage Files finds any document
constituting a part
of a Trustee's Mortgage File which is not executed, has not been
received, is
unrelated to the Mortgage Loan identified in the related
Mortgage Loan Schedule,
or does not conform to the requirements of Section 2.3 or the
description
thereof as set forth in the related Mortgage Loan Schedule, the
Trustee [or the
Certificate Insurer, as applicable,] shall promptly so notify
the Master
Servicer, the Transferor, [the Certificate Insurer] and the
Trustee. In
performing any such review, the Trustee may conclusively rely on
the Transferor
as to the purported genuineness of any such document and any
signature thereon.
It is understood that the scope of the Trustee's review of the
Mortgage Files is
limited solely to confirming that the documents listed in
Section 2.3 have been
executed and received and relate to the Mortgage Files
identified in the related
Mortgage Loan Schedule. Pursuant to the Purchase and Sale
Agreement, the
Transferor has agreed to use reasonable efforts to cause to be
remedied a
material defect in a document constituting part of a Mortgage
File of which it
is so notified by the Trustee. If, however, within 120 days
after the Trustee's
notice to it respecting such defect the Transferor has not
caused to be remedied
the defect and the defect materially and adversely affects the
interest of the
Certificateholders in the related Mortgage Loan [or the
interests of the
Certificate Insurer (in either case in the reasonable
determination of
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<PAGE>
the Certificate Insurer)], the Trustee shall enforce the
Transferor's obligation
pursuant to the Purchase and Sale Agreement to either (1)
substitute in lieu of
such Mortgage Loan a Qualified Substitute Mortgage Loan in the
manner and
subject to the conditions set forth in Section 3.3 hereof or (2)
purchase such
Mortgage Loan at a purchase price equal to the outstanding
principal balance of
such Mortgage Loan as of the date of purchase, plus the greater
of (x) all
accrued and unpaid interest thereon and (y) 30 days' interest
thereon, computed
at the related Mortgage Interest Rate, plus the amount of any
unreimbursed
Servicing Advances made by the Master Servicer with respect to
such Mortgage
Loan, which purchase price shall be deposited in the Certificate
Account prior
to the next succeeding Determination Date, after deducting
therefrom any amounts
received in respect of such repurchased Mortgage Loan or Loans
and being held in
the Collection Account or Trustee Collection Account for future
distribution to
the extent such amounts have not yet been applied to principal
or interest on
such Mortgage Loan (the "Loan Repurchase Price"); provided,
however, that the
Transferor may not, pursuant to clause (2) preceding, purchase
the principal
balance of any Mortgage Loan that is not in default or as to
which no default is
imminent unless the Transferor has theretofore delivered an
Opinion of Counsel
knowledgeable in federal income tax matters which states that
such a purchase
would not constitute a prohibited transaction under the
Code.
(d) Upon receipt by the Trustee of a certification of a
Servicing
Officer of such substitution or purchase and, in the case of a
substitution,
upon receipt of the related Trustee's Mortgage File, and the
deposit of the
amounts described above into the Certificate Account (which
certification shall
be in the form of Exhibit H hereto), the Trustee shall release
to the Master
Servicer for release to the Transferor the related Trustee's
Mortgage File and
shall execute, without recourse, and deliver such instruments of
transfer
furnished by the Transferor as may be necessary to transfer such
Mortgage Loan
to the Transferor. [The Trustee shall notify the Certificate
Insurer if the
Transferor fails to repurchase or substitute for a Mortgage Loan
in accordance
with the foregoing.]
Section 2.5 Designations Under REMIC Provisions; Designation
Of
Startup Date.
(a) The Class A Certificates are hereby designated as the
"regular
interests", and the Class R Certificates are designated the
single Class of
"residual interests" in the 200_ - _ REMIC for the purposes of
the REMIC
Provisions. The 200_ - _ REMIC shall be designated as the
"_______ HOME EQUITY
TRUST 200_ - _ REMIC."
(b) The Closing Date will be the "startup day" of the 200_ - _
REMIC
within the meaning of Section 860G(a)(9) of the Code (the
"Startup Date").
Section 2.6 Execution Of Certificates. The Trustee acknowledges
the
assignment to it of the Mortgage Loans and the delivery to it of
the Trustee's
Mortgage Files relating thereto and, concurrently with such
delivery, has
executed, authenticated and delivered to or upon the order of
the Depositor, in
exchange for the Mortgage Loans, the Trustee's Mortgage Files
and the other
assets included in the definition of Trust Fund, Certificates
duly authenticated
by the Trustee, and, in the case of the Class A Certificates, in
Authorized
Denominations, evidencing the entire beneficial ownership
interest in the Trust
Fund.
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<PAGE>
Section 2.7 Application Of Principal And Interest. In the event
that
Net Liquidation Proceeds on a Liquidated Mortgage Loan are less
than the
outstanding principal balance of the related Mortgage Loan plus
accrued interest
thereon, or any Mortgagor makes a partial payment of any Monthly
Payment due on
a Mortgage Loan, such Net Liquidation Proceeds or partial
payment shall be
applied to payment of the related Mortgage Note as provided
therein, and if not
so provided, first to interest accrued at the Mortgage Interest
Rate, then to
the principal owed on such Mortgage Loan.
Section 2.8 Grant Of Security Interest.
(a) It is the intention of the parties hereto that the
conveyance by
the Depositor of the Trust Fund to the Trustee on behalf of the
Trust shall
constitute a purchase and sale of such Trust Fund and not a
loan. In the event,
however, that a court of competent jurisdiction were to hold
that the
transaction evidenced hereby constitutes a loan and not a
purchase and sale, it
is the intention of the parties hereto that this Agreement shall
constitute a
security agreement under applicable law, and that the Depositor
shall be deemed
to have granted and hereby grants 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, to and under the Trust Fund to secure a
loan in an amount
equal to the purchase price of the Mortgage Loans. The
conveyance by the
Depositor of the Trust Fund to the Trustee on behalf of the
Trust shall not
constitute and is not intended to result in an assumption by the
Trustee[, the
Certificate Insurer] or any Certificateholder of any obligation
of the
Transferor, _______________________ or any other Person in
connection with the
Trust Fund.
(b) The Depositor and the Master Servicer shall take no
action
inconsistent with the Trust's ownership of the Trust Fund and
shall indicate or
shall cause to be indicated in its records and records held on
its behalf that
ownership of each Mortgage Loan and the assets in the Trust Fund
are held by the
Trustee on behalf of the Trust. In addition, the Depositor and
the Master
Servicer shall respond to any inquiries from third parties with
respect to
ownership of a Mortgage Loan or any other asset in the Trust
Fund by stating
that it is not the owner of such asset and that ownership of
such Mortgage Loan
or other Trust Fund asset is held by the Trustee on behalf of
the Trust.
Section 2.9 Further Assurances; Powers Of Attorney.
(a) The Master Servicer agrees that, from time to time, at
its
expense, it shall cause the Transferor (and the Depositor also
agrees that it
shall), promptly to execute and deliver all further instruments
and documents,
and take all further action, that may be necessary or
appropriate, or that the
Master Servicer or the Trustee may reasonably request, in order
to perfect,
protect or more fully evidence the transfer of ownership of the
Trust Fund or to
enable the Trustee to exercise or enforce any of its rights
hereunder. Without
limiting the generality of the foregoing, the Master Servicer
and the Depositor
will, upon the request of the Master Servicer or of the Trustee
execute and file
(or cause to be executed and filed) such real estate filings,
financing or
continuation statements, or amendments thereto or assignments
thereof, and such
other instruments or notices, as may be necessary or
appropriate.
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<PAGE>
(b) In the event that the Depositor in unable to fulfill its
obligations in subsection (a) above, the Depositor hereby grants
to the Master
Servicer and the Trustee powers of attorney to execute all
documents on its
behalf under this Agreement and the Purchase and Sale Agreement
as may be
necessary or desirable to effectuate the foregoing.
[Remainder of this page intentionally left blank]
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.1 Representations Of The Master Servicer. The
Master
Servicer hereby represents and warrants to the Trustee, the
Depositor[, the
Certificate Insurer] and the Certificateholders as of the
Closing Date and
during the term of this Agreement:
(a) the Master Servicer is a ______ duly organized, validly
existing
and in good standing under the laws of the State of _______, and
has full power
and authority to own its assets and to transact the business in
which it is
currently engaged. The Master Servicer is duly qualified to do
business and is
in good standing in each jurisdiction in which the character of
the business
transacted by it or properties owned or leased by it requires
such qualification
and in which the failure to so qualify would have a material
adverse effect on
the business, properties, assets or condition (financial or
otherwise) of the
Master Servicer;
(b) the Master Servicer has full power and authority to
make,
execute, deliver and perform this Agreement and all of the
transactions
contemplated hereunder, and has taken all necessary corporate
action to
authorize the execution, delivery and performance of this
Agreement;
(c) the Master Servicer is not required to obtain the consent of
any
other Person or any consent, license, approval or authorization
from, or
registration or declaration with, any governmental authority,
bureau or agency
in connection with the execution, delivery, performance,
validity or
enforceability of this Agreement, except for such consent,
license, approval or
authorization or registration or declaration as shall have been
obtained or
filed, as the case may be;
(d) the execution and delivery of this Agreement and the
performance
of the transactions contemplated hereby by the Master Servicer
will not violate
any material provision of any existing law or regulation or any
order or decree
of any court applicable to the Master Servicer or any provision
of the articles
or bylaws of the Master Servicer, or constitute a material
breach of any
mortgage, indenture, contract or other agreement to which the
Master Servicer is
a party or by which it may be bound; and
(e) no suit in equity, action at law or other judicial or
administrative proceeding of or before any court, tribunal or
governmental body
is currently pending or, to the knowledge of the Master
Servicer, threatened
against the Master Servicer or any of its properties or with
respect to this
Agreement or the Certificates that in the opinion of the Master
Servicer has a
reasonable likelihood of resulting in a material adverse effect
on the
transactions contemplated by this Agreement.
It is understood and agreed that the representations, warranties
and covenants
set forth in this Section 3.1 shall survive the delivery of the
respective
Mortgage Files to the Trustee or to a custodian, as the case may
be, and inure
to the benefit of the Trustee [and the Certificate Insurer].
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<PAGE>
Section 3.2 Representations, Warranties And Covenants Of The
Depositor. The Depositor hereby represents, warrants and
covenants to the
Trustee that as of the date of this Agreement or as of such date
specifically
provided herein:
(a) The Depositor is a corporation duly organized, validly
existing
and in good standing under the laws of the State of
Delaware;
(b) The Depositor has the power and authority to convey the
Mortgage
Loans and to execute, deliver and perform, and to enter into and
consummate
transactions contemplated by, this Agreement;
(c) This Agreement has been duly and validly authorized,
executed
and delivered by the Depositor, all requisite company action
having been taken,
and, assuming the due authorization, execution and delivery
hereof by the Master
Servicer and the Trustee, constitutes or will constitute the
legal, valid and
binding agreement of the Depositor, enforceable against the
Depositor in
accordance with its terms, except as such enforcement may be
limited by
bankruptcy, insolvency, reorganization, moratorium or other
similar laws
relating to or affecting the rights of creditors generally, and
by general
equity principles (regardless of whether such enforcement is
considered in a
proceeding in equity or at law);
(d) No consent, approval, authorization or order of, or
registration
or filing with, or notice to, any governmental authority or
court is required
for the execution, delivery and performance of or compliance by
the Depositor
with this Agreement or the consummation by the Depositor of any
of the
transactions contemplated hereby, except as have been received
or obtained on or
prior to the Closing Date;
(e) None of the execution and delivery of this Agreement,
the
consummation of the transactions contemplated hereby or thereby,
or the
fulfillment of or compliance with the terms and conditions of
this Agreement,
(1) conflicts or will conflict with or results or will result in
a breach of, or
constitutes or will constitute a default or results or will
result in an
acceleration under (i) the certificate of incorporation or
bylaws of the
Depositor, or (ii) of any term, condition or provision of any
material
indenture, deed of trust, contract or other agreement or
instrument to which the
Depositor or any of its subsidiaries is a party or by which it
or any of its
subsidiaries is bound; (2) results or will result in a violation
of any law,
rule, regulation, order, judgment or decree applicable to the
Depositor of any
court or governmental authority having jurisdiction over the
Depositor or its
subsidiaries; or (3) results in the creation or imposition of
any lien, charge
or encumbrance which would have a material adverse effect upon
the Mortgage
Loans or any documents or instruments evidencing or securing the
Mortgage Loans;
(f) There are no actions, suits or proceedings before or against
or
investigations of, the Depositor pending, or to the knowledge of
the Depositor,
threatened, before any court, administrative agency or other
tribunal, and no
notice of any such action, which, in the Depositor's reasonable
judgment, might
materially and adversely affect the performance by the Depositor
of its
obligations under this Agreement, or the validity or
enforceability of this
Agreement; and
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<PAGE>
(g) The Depositor is not in default with respect to any order
or
decree of any court or any order, regulation or demand of any
federal, state,
municipal or governmental agency that would materially and
adversely affect its
performance hereunder.
It is understood and agreed that the representations, warranties
and
covenants set forth in this Section 3.2 shall survive delivery
of the respective
Mortgage Files to the Trustee or to a custodian, as the case
maybe, and shall
inure to the benefit of the Trustee [and the Certificate
Insurer].
Section 3.3 Purchase And Substitution.
(a) It is understood and agreed that the representations and
warranties set forth in Sections 3.1 and 3.2 of the Purchase and
Sale Agreement
shall survive delivery of the Certificates to the
Certificateholders. Pursuant
to the Purchase and Sale Agreement, with respect to any
representation or
warranty contained in Sections 3.1 or 3.2 of the Purchase and
Sale Agreement
that is made to the best of the Transferor's knowledge, if it is
discovered by
the Master Servicer, any Subservicer, the Trustee[, the
Certificate Insurer] or
any Certificateholder that the substance of such representation
and warranty was
inaccurate as of the Closing Date and such inaccuracy materially
and adversely
affects the value of the related Mortgage Loan, then
notwithstanding the
Transferor's lack of knowledge with respect to the inaccuracy at
the time the
representation or warranty was made, such inaccuracy shall be
deemed a breach of
the applicable representation or warranty. Upon discovery by the
Transferor, the
Master Servicer, any Subservicer, the Trustee [or the
Certificate Insurer] of a
breach of any of such representations and warranties which
materially and
adversely affects the value of the Mortgage Loans or the
interest of the
Certificateholders, or which materially and adversely affects
the interests of
the [Certificate Insurer or the] Certificateholders in the
related Mortgage Loan
in the case of a representation and warranty relating to a
particular Mortgage
Loan (notwithstanding that such representation and warranty was
made to the
Transferor's best knowledge), the party discovering such breach
shall give
prompt written notice to the others. Subject to the last
paragraph of this
Section 3.3, within 60 days of the earlier of its discovery or
its receipt of
notice of any breach of a representation or warranty, pursuant
to the Purchase
and Sale Agreement, the Transferor shall be required to (1)
promptly cure such
breach in all material respects, (2) purchase such Mortgage Loan
in the manner
and at the price specified in Section 2.4(c) (in which case the
Mortgage Loan
shall become a Deleted Mortgage Loan), or (3) remove such
Mortgage Loan from the
Trust Fund (in which case the Mortgage Loan shall become a
Deleted Mortgage
Loan) and substitute one or more Qualified Substitute Mortgage
Loans; provided,
that, such substitution is effected not later than the date
which is two years
after the Startup Date or at such later date, if the Trustee
[and the
Certificate Insurer] receive an Opinion of Counsel to the effect
that such
substitution will not constitute a prohibited transaction for
the purposes of
the REMIC provisions of the Code or cause the 200_ - _ REMIC to
fail to qualify
as a REMIC at any time any Certificates are outstanding.
Pursuant to the
Purchase and Sale Agreement, any such substitution shall be
accompanied by
payment by the Transferor of the Substitution Adjustment, if
any, to the Master
Servicer to be deposited in the Certificate Account.
(b) As to any Deleted Mortgage Loan for which the Transferor
substitutes a Qualified Substitute Mortgage Loan or Loans, the
Transferor shall
be required pursuant to the Purchase and Sale Agreement to
effect such
substitution by delivering to the Trustee a
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certification in the form attached hereto as Exhibit H, executed
by a Servicing
Officer and the documents described in Sections 2.3(a)(i)-(v)
for such Qualified
Substitute Mortgage Loan or Loans.
(c) The Master Servicer shall deposit in the Collection Account
all
payments received in connection with such Qualified Substitute
Mortgage Loan or
Loans after the date of such substitution. Monthly Payments
received with
respect to Qualified Substitute Mortgage Loans on or before the
date of
substitution will be retained by the Transferor. The Trust Fund
will own all
payments received on the Deleted Mortgage Loan on or before the
date of
substitution, and the Transferor shall thereafter be entitled to
retain all
amounts subsequently received in respect of such Deleted
Mortgage Loan. The
Master Servicer shall give written notice to the Trustee [and
the Certificate
Insurer] that such substitution has taken place and shall amend
the Mortgage
Loan Schedule to reflect the removal of such Deleted Mortgage
Loan from the
terms of this Agreement and the substitution of the Qualified
Substitute
Mortgage Loan. Upon such substitution, such Qualified Substitute
Mortgage Loan
or Loans shall be subject to the terms of this Agreement in all
respects.
(d) It is understood and agreed that the obligation of the
Transferor set forth in Section 3.4 of the Purchase and Sale
Agreement to cure,
purchase, substitute or otherwise pay amounts to the Trust [or
the Certificate
Insurer] for a defective Mortgage Loan as provided in such
Section 3.4
constitutes the sole remedies of the Trustee[, the Certificate
Insurer] and the
Certificateholders with respect to a breach of the
representations and
warranties of the Transferor set forth in Sections 3.1 and 3.2
of the Purchase
and Sale Agreement. The Trustee shall give prompt written notice
to the
[Certificate Insurer,] _______ and _______ of any repurchase or
substitution
made pursuant to Section 3.3 or Section 2.4(b) hereof.
(e) Upon discovery by the Master Servicer, the Trustee[, the
Certificate Insurer] or any Certificateholder that any Mortgage
Loan does not
constitute a Qualified Mortgage, the Person discovering such
fact shall promptly
(and in any event within 5 days of the discovery) give written
notice thereof to
the others of such Persons. In connection therewith, pursuant to
the Purchase
and Sale Agreement, the Transferor shall be required to
repurchase or substitute
a Qualified Substitute Mortgage Loan for the affected Mortgage
Loan within 60
days of the earlier of such discovery by any of the foregoing
parties, or the
Trustee's or the Transferor's receipt of notice, in the same
manner as it would
a Mortgage Loan for a breach of representation or warranty
contained in Section
3.1 or 3.2 of the Purchase and Sale Agreement. The Trustee shall
reconvey to the
Transferor the Mortgage Loan to be released pursuant hereto in
the same manner,
and on the same terms and conditions, as it would a Mortgage
Loan repurchased
for breach of a representation or warranty contained in Section
3.1 or 3.2 of
the Purchase and Sale Agreement.
Section 3.4 Master Servicer Covenants. The Master Servicer
hereby
covenants to the Trustee, the Depositor [and the Certificate
Insurer] and the
Certificateholders that as of the Closing Date and during the
term of this
Agreement:
(a) The Master Servicer shall deliver on the Closing Date an
opinion
from the general counsel or the corporate counsel of the Master
Servicer as to
general corporate matters in
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form and substance reasonably satisfactory to Underwriter's
counsel [and counsel
to the Certificate Insurer]; and
(b) The Master Servicer may in its discretion (1) waive any
prepayment penalty or other charge, assumption fee, late payment
charge or other
charge in connection with a Mortgage Loan, and (2) arrange a
schedule, running
for no more than 180 days after the Due Date for payment of any
installment on
any Mortgage Note, for the liquidation of delinquent items;
provided, that the
Master Servicer shall not agree to the modification or waiver of
any provision
of a Mortgage Loan at a time when such Mortgage Loan is not in
default or such
default is not imminent, if such modification or waiver would be
treated as a
taxable exchange under Code Section 1001, unless such exchange
would not be
considered a "prohibited transaction" under the REMIC
Provisions.
It is understood and agreed that the covenants set forth in this
Section 3.4
shall survive the delivery of the respective Mortgage Files to
the Trustee or to
a custodian, as the case may be, and inure to the benefit of the
Trustee [and
the Certificate Insurer].
[Remainder of this page intentionally left blank]
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<PAGE>
ARTICLE IV
THE CERTIFICATES
Section 4.1 The Certificates. The Certificates shall be
substantially in the forms annexed hereto as, in the case of the
Class A-1
Certificate, Exhibit B-1, in the case of the Class A-2
Certificate, Exhibit B-2,
in the case of the Class A-3 Certificate, Exhibit B-3, in the
case of the Class
A-4 Certificate, Exhibit B-4, in the case of the Class A-5
Certificate, Exhibit
B-5 and in the case of the Class R Certificate, Exhibit B-6. All
Certificates
shall be executed by manual or facsimile signature on behalf of
the Trustee by
an authorized officer and authenticated by the manual or
facsimile signature of
an authorized officer. Any Certificates bearing the signatures
of individuals
who were at the time of the execution thereof the authorized
officers of the
Trustee shall bind the Trustee, notwithstanding that such
individuals or any of
them have ceased to hold such offices prior to the delivery of
such Certificates
or did not hold such offices at the date of such Certificates.
All Certificates
issued hereunder shall be dated the date of their
authentication.
Section 4.2 Registration Of Transfer And Exchange Of
Certificates.
(a) The Trustee, as registrar, shall cause to be kept a
register
(the "Certificate Register") in which, subject to such
reasonable regulations as
it may prescribe, the Trustee shall provide for the registration
of Certificates
and the registration of transfer of Certificates. The Trustee is
hereby
appointed registrar for the purpose of registering and
transferring
Certificates, as herein provided. The [Certificate Insurer and
the] Master
Servicer shall be entitled to inspect and copy the Certificate
Register and the
records of the Trustee relating to the Certificates during
normal business hours
upon reasonable notice.
(b) All Certificates issued upon any registration of transfer
or
exchange of Certificates shall be valid evidence of the same
ownership interests
in the Trust and entitled to the same benefits under this
Agreement as the
Certificates surrendered upon such registration of transfer or
exchange.
(c) Every Certificate presented or surrendered for registration
of
transfer or exchange shall be duly endorsed, or be accompanied
by a written
instrument of transfer in form satisfactory to the Trustee duly
executed by the
Holder or holder thereof or his attorney duly authorized in
writing. [Every
Certificate shall include a statement of insurance provided by
the Certificate
Insurer.]
(d) No service charge shall be made to a Holder or holder for
any
registration of transfer or exchange of Certificates, but the
Trustee may
require payment of a sum sufficient to cover any tax or other
governmental
charge that may be imposed in connection with any registration
of transfer or
exchange of Certificates; any other expenses in connection with
such transferor
exchange shall be an expense of the Trust.
(e) It is intended that the Class A Certificates be registered
so as
to participate in a global book-entry system with the
Depository, as set forth
herein. The Class A-1
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Certificates shall, except as otherwise provided in the next
paragraph, be
initially issued in the form of a single fully registered Class
A-1 Certificate
with a denomination equal to the Original Class A-1 Principal
Balance. The Class
A-2 Certificates shall, except as otherwise provided in the next
paragraph, be
initially issued in the form of a single fully registered Class
A-2 Certificate
with a denomination equal to the Original Class A-2 Principal
Balance. The Class
A-3 Certificates shall, except as otherwise provided in the next
paragraph, be
initially issued in the form of a single fully registered Class
A-3 Certificate
with a denomination equal to the Original Class A-3 Principal
Balance. The Class
A-4 Certificates shall, except as otherwise provided in the next
paragraph, be
initially issued in the form of a single fully registered Class
A-4 Certificate
with a denomination equal to the Original Class A-4 Principal
Balance. The Class
A-5 Certificates shall, except as otherwise provided in the next
paragraph, be
initially issued in the form of a single fully registered Class
A-5 Certificate
with a denomination equal to the Original Class A-5 Principal
Balance. Upon
initial issuance, the ownership of each such Class A Certificate
shall be
registered in the Certificate Register in the name of Cede &
Co., or any
successor thereto, as nominee for the Depository. The Depositor
and the Trustee
are hereby authorized to execute and deliver the Representation
Letter with the
Depository. With respect to Class A Certificates registered in
the Certificate
Register in the name of Cede & Co., as nominee of the
Depository, the Depositor,
the Transferor, the Master Servicer, the Trustee [and the
Certificate Insurer]
shall have no responsibility or obligation to Direct or Indirect
Participants or
beneficial owners for which the Depository holds Class A
Certificates from time
to time as a Depository. Without limiting the immediately
preceding sentence,
the Depositor, the Transferor, the Master Servicer, the Trustee
[and the
Certificate Insurer] shall have no responsibility or obligation
with respect to
(1) the accuracy of the records of the Depository, Cede &
Co., or any Direct or
Indirect Participant with respect to any Ownership Interest, (2)
the delivery to
any Direct or Indirect Participant or any other Person, other
than a
Certificateholder, of any notice with respect to the Class A
Certificates or (3)
the payment to any Direct or Indirect Participant or any other
Person, other
than a Certificateholder, of any amount with respect to any
distribution of
principal or interest on the Class A Certificates. No Person
other than a
Certificateholder shall receive a certificate evidencing such
Class A
Certificate. Upon delivery by the Depository to the Trustee of
written notice to
the effect that the Depository has determined to substitute a
new nominee in
place of Cede & Co., and subject to the provisions hereof
with respect to the
payment of interest by the mailing of checks or drafts to the
Certificateholders
appearing as Certificateholders at the close of business on a
Record Date, the
name "Cede &Co." in this Agreement shall refer to such new
nominee of the
Depository.
(f) In the event that (1) the Depository or the Master
Servicer
advises the Trustee in writing that the Depository is no longer
willing or able
to discharge properly its responsibilities as nominee and
depository with
respect to the Class A Certificates and the Master Servicer or
the Depository is
unable to locate a qualified successor or (2) the Master
Servicer at its sole
option elects to terminate the book-entry system through the
Depository, the
Class A Certificates shall no longer be restricted to being
registered in the
Certificate Register in the name of Cede & Co. (or a
successor nominee) as
nominee of the Depository. At that time, the Master Servicer may
determine that
the Class A Certificates shall be registered in the name of and
deposited with a
successor depository operating a global book-entry system, as
may be acceptable
to the Master Servicer, or such depository's agent or designee
but, if the
Master Servicer does not select such alternative global
book-entry system, then
the Class A Certificates may be registered in whatever name or
names
Certificateholders transferring Class A Certificates
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<PAGE>
shall designate, in accordance with the provisions hereof;
provided, however,
that any such reregistration shall be at the expense of the
Master Servicer.
(g) Notwithstanding any other provision of this Agreement to
the
contrary, so long as any Class A Certificate is registered in
the name of Cede &
Co., as nominee of the Depository, all distributions of
principal or interest on
such Class A Certificates as the case may be and all notices
with respect to
such Class A Certificates as the case may be shall be made and
given,
respectively, in the manner provided in the Representation
Letter.
(h) No transfer, sale, pledge or other disposition of any Class
R
Certificate shall be made unless such disposition is made
pursuant to an
effective registration statement under the Securities Act of
1933 and effective
registration or qualification under applicable state securities
laws or "Blue
Sky" laws, or is made in a transaction that does not require
such registration
or qualification. None of the Master Servicer, the Depositor,
the Transferor or
the Trustee is obligated under this Agreement to register the
Certificates under
the Securities Act of 1933, as amended or any other securities
law or to take
any action not otherwise required under this Agreement to permit
the transfer of
the Class R Certificates without such registration or
qualification. Any such
Certificateholder desiring to effect such transfer shall, and
does hereby agree
to, indemnify the Trustee, the Depositor, the Transferor, the
Master Servicer
[and the Certificate Insurer] against any liability that may
result if the
transfer is not exempt or is not made in accordance with such
applicable federal
and state laws. Promptly after receipt by an indemnified party
under this
paragraph of notice of the commencement of any action, such
indemnified party
will, if a claim in respect thereof is to be made against the
indemnifying party
under this paragraph, notify the indemnifying party in writing
of the
commencement thereof; but the omission so to notify the
indemnifying party will
not relieve it from any liability which it may have to any
indemnified party
otherwise than under this paragraph. In case any such action is
brought against
any indemnified party, and it notifies the indemnifying party of
the
commencement thereof, the indemnifying party will be entitled to
appoint counsel
reasonably satisfactory to such indemnified party to represent
the indemnified
party in such action; provided, however, that if the defendants
in any such
action include both the indemnified party and the indemnifying
party and the
indemnified party shall have reasonably concluded that there may
be legal
defenses available to it and/or other indemnified parties which
are in conflict
with or contrary to the interests of the indemnifying party, the
indemnified
party or parties shall have the right to select separate counsel
to defend such
action on behalf of such indemnified party or parties. Upon
receipt of notice
from the indemnifying party to such indemnified party of its
election so to
appoint counsel to defend such action and approval by the
indemnified party of
such counsel, the indemnifying party will not be liable to such
indemnified
party under this paragraph for any legal or other expenses
subsequently incurred
by such indemnified party in connection with the defense thereof
unless (1) the
indemnified party shall have employed separate counsel in
accordance with the
proviso of the next preceding sentence (it being understood,
however, that the
indemnifying party shall not be liable for the expenses of more
than one
separate counsel for any indemnified party), (2) the
indemnifying party shall
not have employed counsel satisfactory to the indemnified party
to represent the
indemnified party within a reasonable time after notice of
commencement of the
action or (3) the indemnifying party has authorized the
employment of counsel
for the indemnified party at the expense of the indemnifying
party. Under no
circumstances shall the indemnified party enter into a
settlement
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agreement with respect to any lawsuit, claim or other proceeding
without the
prior written consent of the indemnifying party.
(i) Each Person who has or who acquires any Ownership Interest
in a
Class R Certificate shall be deemed by the
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