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EXHIBIT 4.1
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MILA MORTGAGE ACCEPTANCE, INC.
Company,
[NAME OF MASTER SERVICER]
Master Servicer,
and
[NAME OF TRUSTEE],
Trustee
POOLING AND SERVICING AGREEMENT
Dated as of_____________1, 200_
Mortgage Pass-Through Certificates
Series 200_-__
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<PAGE>
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
SECTION 1.01. Defined
Terms.................................................
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01. Conveyance of Mortgage
Loans..................................
SECTION 2.02. Acceptance of the Trust Fund by the
Trustee...................
SECTION 2.03. Representations, Warranties and Covenants of the
Master
Servicer and the Company....................................
SECTION 2.04. Representations and Warranties of the Seller;
Repurchase
and Substitution............................................
SECTION 2.05. Issuance of Certificates Evidencing Interests in
the
Trust Fund..................................................
ARTICLE III
ADMINISTRATION AND SERVICING OF THE TRUST FUND
SECTION 3.01. Master Servicer to Act as Master
Servicer.....................
SECTION 3.02. Sub-Servicing Agreements Between Master
Servicer
and Sub-Servicers...........................................
SECTION 3.03. Successor
Sub-Servicers.......................................
SECTION 3.04. Liability of the Master
Servicer..............................
SECTION 3.05. No Contractual Relationship Between Sub-Servicers
and
Trustee or Certificateholders...............................
SECTION 3.06. Assumption or Termination of Sub-Servicing
Agreements
by Trustee..................................................
SECTION 3.07. Collection of Certain Mortgage Loan
Payments..................
SECTION 3.08. Sub-Servicing
Accounts........................................
SECTION 3.09. Collection of Taxes, Assessments and Similar
Items;
Servicing Accounts..........................................
SECTION 3.10. Custodial
Account.............................................
SECTION 3.11. Permitted Withdrawals From the Custodial
Account..............
SECTION 3.12. Permitted
Instruments.........................................
SECTION 3.13. Maintenance of Primary Mortgage Insurance and
Primary Hazard
Insurance...................................................
SECTION 3.14. Enforcement of Due-on-Sale Clauses; Assumption
Agreements.....
SECTION 3.15. Realization Upon Defaulted Mortgage
Loans.....................
SECTION 3.16. Trustee to Cooperate; Release of Mortgage
Files...............
SECTION 3.17. Servicing
Compensation........................................
SECTION 3.18. Maintenance of Certain Servicing
Policies.....................
SECTION 3.19. Annual Statement as to
Compliance.............................
SECTION 3.20. Annual Independent Public Accountants' Servicing
Statement....
SECTION 3.21. Access to Certain
Documentation...............................
SECTION 3.22. Title, Conservation and Disposition of REO
Property...........
SECTION 3.23. Additional Obligations of the Master
Servicer.................
SECTION 3.24. Additional Obligations of the
Company.........................
ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS
SECTION 4.01. Certificate Account;
Distributions............................
SECTION 4.02. Statements to
Certificateholders..............................
SECTION 4.03. Remittance Reports; Advances by the Master
Servicer...........
SECTION 4.04. Allocation of Realized
Losses.................................
SECTION 4.05. Information Reports to be Filed by the Master
Servicer........
SECTION 4.06. Compliance with Withholding
Requirements......................
ARTICLE V
THE CERTIFICATES
SECTION 5.01. The
Certificates..............................................
SECTION 5.02. Registration of Transfer and Exchange of
Certificates.........
SECTION 5.03. Mutilated, Destroyed, Lost or Stolen
Certificates.............
SECTION 5.04. Persons Deemed
Owners.........................................
ARTICLE VI
THE COMPANY AND THE MASTER SERVICER
SECTION 6.01. Liability of the Company and the Master
Servicer..............
SECTION 6.02. Merger, Consolidation or Conversion of the Company
or the
Master Servicer.............................................
SECTION 6.03. Limitation on Liability of the Company, the Master
Servicer
and Others..................................................
SECTION 6.04. Limitation on Resignation of the Master
Servicer..............
ARTICLE VII
DEFAULT
SECTION 7.01. Events of
Default.............................................
SECTION 7.02. Trustee to Act; Appointment of
Successor......................
SECTION 7.03. Notification to
Certificateholders............................
SECTION 7.04. Waiver of Events of
Default...................................
ARTICLE VIII
CONCERNING THE TRUSTEE
SECTION 8.01. Duties of
Trustee.............................................
SECTION 8.02. Certain Matters Affecting the
Trustee.........................
SECTION 8.03. Trustee Not Liable for Certificates or Mortgage
Loans.........
SECTION 8.04. Trustee May Own
Certificates..................................
SECTION 8.05. Payment of Trustee's
Fees.....................................
SECTION 8.06. Eligibility Requirements for
Trustee..........................
SECTION 8.07. Resignation and Removal of the
Trustee........................
SECTION 8.08. Successor
Trustee.............................................
SECTION 8.09. Merger or Consolidation of
Trustee............................
SECTION 8.10. Appointment of Co-Trustee or Separate
Trustee.................
ARTICLE IX
TERMINATION
SECTION 9.01. Termination Upon Repurchase or Liquidation of All
Mortgage
Loans.......................................................
SECTION 9.02. Additional Termination
Requirements...........................
ARTICLE X
REMIC PROVISIONS
SECTION 10.01. REMIC
Administration..........................................
SECTION 10.02. Prohibited Transactions and
Activities........................
SECTION 10.03. Master Servicer and Trustee
Indemnification...................
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.01.
Amendment.....................................................
SECTION 11.02. Recordation of Agreement;
Counterparts........................
SECTION 11.03. Limitation on Rights of
Certificateholders....................
SECTION 11.04. Governing
Law.................................................
SECTION 11.05.
Notices.......................................................
SECTION 11.06. Severability of
Provisions....................................
SECTION 11.07. Successors and Assigns; Third Party
Beneficiary...............
SECTION 11.08. Article and Section
Headings..................................
SECTION 11.09. Notice to Rating Agencies and
Certificateholder...............
Exhibit A-1 Form of Class A Certificate
Exhibit A-2 Form of Class B Certificate
Exhibit B Form of Class R Certificate
Exhibit C Form of Trustee Initial Certification
Exhibit D Form of Trustee Final Certification
Exhibit E Form of Remittance Report
Exhibit F-1 Request for Release
Exhibit F-2 Request for Release for Mortgage Loans Paid in
Full
Exhibit G-1 Form of Investor Representation Letter
Exhibit G-2 Form of Transferor Representation Letter
Exhibit G-3 Transferor Affidavit and Agreement in connection
with transfer
of Residual Certificates
Exhibit G-4 Form of Transferor Certificate
Exhibit G-5 Form of Investor Representation Letter for Insurance
Companies
Exhibit H Mortgage Loan Schedule
Exhibit I Seller's Warranty Certificate
Exhibit J Form of Notice Under Section 3.24
<PAGE>
This Pooling and Servicing Agreement, effective as of
_______________ 1, 200_, among MILA Mortgage Acceptance, Inc.,
as the company
(together with its permitted successors and assigns, the
"Company"), [NAME OF
MASTER SERVICER], as master servicer (together with its
permitted successors and
assigns, the "Master Servicer"), and [NAME OF TRUSTEE], as
trustee (together
with its permitted successors and assigns, the "Trustee").
PRELIMINARY STATEMENT:
The Company intends to sell mortgage pass-through
certificates
(collectively, the "Certificates"), to be issued hereunder in
multiple classes
(each, a "Class"), which in the aggregate will evidence the
entire beneficial
ownership interest in the Mortgage Loans (as defined herein). As
provided
herein, the Master Servicer will make an election to treat the
segregated pool
of assets described in the definition of Trust Fund (as defined
herein), and
subject to this Agreement (including the Mortgage Loans but
excluding the
Initial Monthly Payment Deposit), as a real estate mortgage
investment conduit
(a "REMIC") for federal income tax purposes, and such segregated
pool of assets
will be designated as the "Trust Fund." The Class A-1, Class
A-2, Class A-3,
Class A-4, Class A-5, Class A-6, Class A-7 and Class B
Certificates will
represent ownership of "regular interests" in the Trust Fund,
and the Class R
Certificates will be the sole class of "residual interests"
therein, for
purposes of the REMIC Provisions (as defined herein) under
federal income tax
law.
The following table sets forth the designation, type,
Pass-Through Rate, aggregate Initial Certificate Principal
Balance, initial
ratings and certain features for each Class of Certificates
comprising the
interests in the Trust Fund created hereunder.
AGGREGATE INITIAL PASS-CERTIFICATE
INITIAL RATINGS THROUGH PRINCIPAL DESCRIPTION TYPE
RATE BALANCE FEATURES
[INSERT TABLE HERE]
The Mortgage Loans have an aggregate Stated Principal
Balance
as of the Cut-off Date equal to $___________. The Mortgage Loans
are fixed rate
mortgage loans having terms to maturity at origination or
modification of not
more than 30 years.
In consideration of the mutual agreements herein contained,
the Company, the Master Servicer and the Trustee agree as
follows:
<PAGE>
ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Terms.
Whenever used in this Agreement, the following words and
phrases, unless the context otherwise requires, shall have the
meanings
specified in this Article.
"Accrued Certificate Interest": With respect to each
Distribution Date, as to any Class A Certificate (other than the
Class A-5
Certificates and Class A-7 Certificates) or any Class B
Certificate, one month's
interest accrued at the then applicable Pass-Through Rate on the
Certificate
Principal Balance thereof immediately prior to such Distribution
Date. With
respect to each Distribution Date, as to the Class A-5
Certificates and Class
A-7 Certificates, one month's interest accrued at the then
applicable
Pass-Through Rate on the Notional Amount thereof immediately
prior to such
Distribution Date. Accrued Certificate Interest will be
calculated on the basis
of a 360-day year consisting of twelve 30-day months. In each
case Accrued
Certificate Interest on any Class of Certificates will be
reduced by the amount
of (i) Prepayment Interest Shortfalls, if any, which are not
covered by payments
by the Master Servicer pursuant to Section 3.23 with respect to
such
Distribution Date, (ii) the interest portion (adjusted to the
related Net
Mortgage Rate) of any of Realized Losses (including Excess
Special Hazard
Losses, Excess Fraud Losses, Excess Bankruptcy Losses and
Extraordinary Losses)
not allocated solely to one or more specific Classes of
Certificates pursuant to
Section 4.04 (which, with respect to the pro rata portion
thereof allocated to
the Class A-1, Class A-5 and Class A-6 Certificates will be
allocated first to
the Class A-6 Certificates and second to the Class A-1 and Class
A-5
Certificates on a pro rata basis to the extent such Realized
Losses are Default
Losses), (iii) the interest portion of Advances previously made
with respect to
a Mortgage Loan or REO Property which remained unreimbursed
following the Cash
Liquidation or REO Disposition of such Mortgage Loan or REO
Property that was
made with respect to delinquencies that were ultimately
determined to be Excess
Special Hazard Losses, Excess Fraud Losses, Excess Bankruptcy
Losses or
Extraordinary Losses, and (iv) any other interest shortfalls not
covered by the
subordination provided by the Class B Certificates pursuant to
Section 4.04,
including interest that is not collectible from the Mortgagor
pursuant to the
Relief Act or similar legislation or regulations as in effect
from time to time;
with all such reductions allocated among the Classes of
Certificates, in
proportion to their respective amounts of Accrued Certificate
Interest which
would have resulted absent such reductions. In addition to that
portion of the
reductions described in the preceding sentence, Accrued
Certificate Interest on
the Class B Certificates will be reduced by the interest portion
(adjusted to
the related Net Mortgage Rate) of Realized Losses that are
allocated solely to
the Class B Certificates pursuant to Section 4.04.
"Advance": As to any Mortgage Loan, any advance made by the
Master Servicer on any Distribution Date pursuant to Section
4.03.
"Agreement": This Pooling and Servicing Agreement and all
amendments hereof.
"Anniversary": Each anniversary of _____________ 1, 20__.
"Assignment": An assignment of Mortgage, notice of transfer
or
equivalent instrument, in recordable form, which is sufficient
under the laws of
the jurisdiction wherein the related Mortgaged Property is
located to reflect of
record the sale of the Mortgage, which assignment, notice of
transfer or
equivalent instrument may be in the form of one or more blanket
assignments
covering Mortgages secured by Mortgaged Properties located in
the same county,
if permitted by law.
"Assignment Agreement": The Assignment and Assumption
Agreement, dated as of ____________, 200_, between [Name of
Seller] and the
Company relating to the transfer and assignment of the Mortgage
Loans.
"Available Distribution Amount": With respect to each
Distribution Date, the Available Distribution Amount will be an
amount equal to
(a) the sum of (i) the balance on deposit in the Custodial
Account as of the
close of business on the related Determination Date and (ii) the
aggregate
amount of any Advances made, all required amounts pursuant to
Section 3.22 and
all amounts required to be paid by the Master Servicer pursuant
to Sections 3.13
and 3.23 by deposits into the Certificate Account on the
immediately preceding
Certificate Account Deposit Date, reduced by (b) the sum, as of
the close of
business on the related Determination Date of (i) Monthly
Payments collected but
due during a Due Period subsequent to the Due Period ending on
the first day of
the month of the related Distribution Date, (ii) all interest or
other income
earned on deposits in the Custodial Account, (iii) any other
amounts
reimbursable or payable to the Master Servicer or any other
Person pursuant to
Section 3.11, (iv) Insurance Proceeds, Liquidation Proceeds,
Principal
Prepayments, REO Proceeds and the proceeds of Mortgage Loan
purchases (or
amounts received in connection with substitutions) made pursuant
to Section 2.02
and 2.04, in each case received or made in the month of such
Distribution Date
and (v) the Trustee's Fee.
"Bankruptcy Amount": As of any date of determination, an
amount, equal to the excess, if any, of (A) $_______, over (B)
the aggregate
amount of Bankruptcy Losses allocated solely to one or more
specific Classes of
Certificates in accordance with Section 4.04.
The Bankruptcy Amount may be further reduced by the Master
Servicer (including accelerating the manner in which such
coverage is reduced)
provided that prior to any such reduction, the Master Servicer
shall (i) obtain
written confirmation from each Rating Agency that such reduction
shall not
reduce the rating assigned to any Class of Certificates by such
Rating Agency
below the lower of the then-current rating or the rating
assigned to such
Certificates as of the Closing Date by such Rating Agency and
(ii) provide a
copy of such written confirmation to the Trustee.
"Bankruptcy Code": The United States Bankruptcy Code of
1978,
as amended.
"Bankruptcy Loss": With respect to any Mortgage Loan, a
Deficient Valuation or Debt Service Reduction; provided,
however, that a
Deficient Valuation or a Debt Service Reduction shall not be
deemed a Bankruptcy
Loss hereunder so long as the Master Servicer has notified the
Trustee in
writing that the Master Servicer is diligently pursuing any
remedies that may
exist in connection with the related Mortgage Loan and either
(A) the related
Mortgage Loan is not in default with regard to payments due
thereunder or (B)
delinquent payments of principal and interest under the related
Mortgage Loan
and any related escrow payments in respect of such Mortgage Loan
are being
advanced on a current basis by the Master Servicer, in either
case without
giving effect to any Deficient Valuation or Debt Service
Reduction.
"Business Day": Any day other than (i) a Saturday or a
Sunday
or (ii) a day on which banking institutions in the State of
______________ or
the State of ______________ (and such other state or states in
which the
Custodial Account or the Certificate Account are at the time
located) are
required or authorized by law or executive order to be
closed.
"Cash Liquidation": As to any defaulted Mortgage Loan other
than a Mortgage Loan as to which an REO Acquisition occurred,
the final receipt
by or on behalf of the Master Servicer of all Insurance
Proceeds, Liquidation
Proceeds and other payments or cash recoveries which the Master
Servicer
reasonably and in good faith expects to be finally recoverable
with respect to
such Mortgage Loan.
"Certificate": Any Class A, Class B or Class R Certificate.
"Certificate Account": The account or accounts created and
maintained pursuant to Section 4.01, which shall be entitled
"___________________________________, as trustee, in trust for
the registered
holders of MILA Mortgage Acceptance, Inc., Mortgage Pass-Through
Certificates,
Series 200_-__" and which must be an Eligible Account.
"Certificate Account Deposit Date": The 20th day (or if such
20th day is not a Business Day, the Business Day immediately
preceding such 20th
day) of the month.
"Certificateholder" or "Holder": The Person in whose name a
Certificate is registered in the Certificate Register, except
that, neither a
Disqualified Organization nor a Non-United States Person shall
be a Holder of a
Class R Certificate for any purposes hereof and, solely for the
purposes of
giving any consent pursuant to this Agreement, any Certificate
registered in the
name of the Company or the Master Servicer or any affiliate
thereof shall be
deemed not to be outstanding and the Voting Rights to which it
is entitled shall
not be taken into account in determining whether the requisite
percentage of
Voting Rights necessary to effect any such consent has been
obtained, except as
otherwise provided in Section 11.01. The Trustee shall be
entitled to rely upon
a certification of the Company or the Master Servicer in
determining if any
Certificates are registered in the name of a respective
affiliate.
"Certificate Owner": With respect to a Book-Entry
Certificate,
the Person who is the beneficial owner of such Certificate, as
reflected on the
books of an indirect participating brokerage firm for which a
Company
Participant acts as agent, if any, and otherwise on the books of
a Company
Participant, if any, and otherwise on the books of the
Company.
"Certificate Principal Balance": With respect to each Class
A
Certificate (other than a Class A-5 Certificate or Class A-7
Certificate), on
any date of determination, an amount equal to (i) the Initial
Certificate
Principal Balance of such Certificate as specified on the face
thereof, minus
(ii) the sum of (x) the aggregate of all amounts previously
distributed with
respect to such Certificate (or any predecessor Certificate) and
applied to
reduce the Certificate Principal Balance thereof pursuant to
Section 4.02(b) and
(y) the aggregate of all reductions in Certificate Principal
Balance deemed to
have occurred in connection with Realized Losses which were
previously allocated
to such Certificate (or any predecessor Certificate) pursuant to
Section 4.04.
With respect to the Class B Certificates, on any date of
determination, an
amount equal to the Percentage Interest evidenced by such
Certificate times the
excess, if any, of (A) the then aggregate Stated Principal
Balance of the
Mortgage Loans over (B) the then aggregate Certificate Principal
Balance of all
other Classes of Certificates then outstanding. The Class A-5
Certificates,
Class A-7 Certificates and Class R Certificates have no
Certificate Principal
Balance.
"Certificate Register": The register maintained pursuant to
Section 5.02.
"Class": Collectively, all of the Certificates bearing the
same designation.
"Class A Certificate": Any one of the Class A-1, Class A-2,
Class A-3, Class A-4, Class A-5, Class A-6 or Class A-7
Certificates, executed
by the Trustee and authenticated by the Certificate Registrar
substantially in
the form annexed hereto as Exhibit A-1, each such Certificate
evidencing an
interest designated as a "regular interest" in the Trust Fund
for purposes of
the REMIC Provisions.
"Class B Certificate": The Class B Certificates executed by
the Trustee and authenticated by the Certificate Registrar
substantially in the
form annexed hereto as Exhibit A-2 and evidencing an interest
designated as a
"regular interest" in the Trust Fund for purposes of the REMIC
Provisions.
"Class B Percentage": With respect to any Distribution Date,
the lesser of (i) 100% minus the Senior Percentage and (ii) a
fraction,
expressed as a percentage, the numerator of which is the
aggregate Certificate
Principal Balance of the Class B Certificates immediately prior
to such date and
the denominator of which is the aggregate Stated Principal
Balance of all of the
Mortgage Loans (or related REO Properties) immediately prior to
such
Distribution Date.
"Class R Certificate": Any one of the Class R Certificates
executed and delivered by the Trustee substantially in the form
annexed hereto
as Exhibit B and evidencing an interest designated as a
"residual interest" in
the REMIC for purposes of the REMIC Provisions.
"Closing Date" : _______________ ___, 20__.
"Code": The Internal Revenue Code of 1986.
"Collateral Value": The appraised value of a Mortgaged
Property based upon the lesser of (i) the appraisal made at the
time of the
origination of the related Mortgage Loan, or (ii) the sales
price of such
Mortgaged Property at such time of origination. With respect to
a Mortgage Loan
the proceeds of which were used to refinance an existing
mortgage loan, the
appraised value of the Mortgaged Property based upon the
appraisal (as reviewed
and approved by the Seller) obtained at the time of
refinancing.
"Company": MILA Mortgage Acceptance, Inc., or its successor
in
interest.
"Corporate Trust Office": The principal office of the
Trustee
at which at any particular time its corporate trust business
with respect to
this Agreement shall be administered, which office at the date
of the execution
of this instrument is located at _____________________,
Attention:
__________________ Series 200_-__.
"Credit Support Depletion Date": The first Distribution Date
on which the Senior Percentage equals 100%.
"Custodial Account": The custodial account or accounts
created
and maintained pursuant to Section 3.10 in a depository
institution, as
custodian for the holders of the Certificates, for the holders
of certain other
interests in mortgage loans serviced or sold by the Master
Servicer and for the
Master Servicer, into which the amounts set forth in Section
3.10 shall be
deposited directly. Any such account or accounts shall be an
Eligible Account.
"Cut-off Date": _____________ 1, 200_.
"Debt Service Reduction": With respect to any Mortgage Loan,
a
reduction in the scheduled Monthly Payment for such Mortgage
Loan by a court of
competent jurisdiction in a proceeding under the Bankruptcy
Code, except such a
reduction constituting a Deficient Valuation or any reduction
that results in a
permanent forgiveness of principal.
"Default Loss": Any Realized Loss that is attributable to
the
related Mortgagor's failure to make any payment of principal or
interest as
required under the Mortgage Note, excluding Special Hazard
Losses (or any other
loss resulting from damage to a Mortgaged Property), Bankruptcy
Losses, Fraud
Losses, or other losses of a type not covered by the
subordination provided by
the Class B Certificates pursuant to Section 4.04.
"Deficient Valuation": With respect to any Mortgage Loan, a
valuation by a court of competent jurisdiction of the Mortgaged
Property in an
amount less than the then outstanding indebtedness under the
Mortgage Loan,
which valuation results from a proceeding initiated by the
Mortgagor under the
Bankruptcy Code.
"Definitive Certificate": Any definitive, fully registered
Certificate.
"Deleted Mortgage Loan": A Mortgage Loan replaced or to be
replaced with a Qualified Substitute Mortgage Loan.
"Determination Date": The 15th day (or if such 15th day is
not
a Business Day, the Business Day immediately preceding such 15th
day) of the
month of the related Distribution Date.
"Disqualified Organization": Any of the following: (i) the
United States, any State or any political subdivision thereof,
any possession of
the United States or any agency or instrumentality of any of the
foregoing
(other than an instrumentality which is a corporation, if all of
its activities
are subject to tax and, except for the Freddie Mac, a majority
of its board of
directors is not selected by any such governmental unit), (ii) a
foreign
government, international organization or any agency or
instrumentality of
either the foregoing, (iii) an organization (except certain
farmers'
cooperatives described in Section 521 of the Code) which is
exempt from tax
imposed by Chapter 1 of the Code (unless such organization is
subject to the tax
imposed by Section 511 of the Code on unrelated business taxable
income), (iv)
rural electric and telephone cooperatives described in Section
1381 of the Code
or (v) any other Person so designated by the Trustee based on an
Opinion of
Counsel obtained by the Trustee, at the expense of the Trust
Fund, (which
opinion shall be sought only if the Trustee has actual knowledge
that the
holding of an Ownership Interest in a Class R Certificate by
such Person may
cause the Trust Fund or any Person having an Ownership Interest
in any Class of
Certificates, other than such Person, to incur a liability for
any federal tax
imposed under the Code that would not otherwise be imposed but
for the Transfer
of an Ownership Interest in a Class R Certificate to such
Person). The terms
"United States," "State" and "international organization" shall
have the
meanings set forth in Section 7701 of the Code or successor
provisions.
"Distribution Date": The 25th day of any month, or if such
25th day is not a Business Day, the Business Day immediately
following such 25th
day commencing on _______ 25, 20__.
"Due Date": The first day of the month of the related
Distribution Date.
"Due Period": With respect to any Distribution Date, the
period commencing on the second day of the month preceding the
month of such
Distribution Date (or, with respect to the first Due Period, the
day following
the Cut-off Date) and ending on the related Due Date.
"Eligible Account": An account maintained with a federal or
state chartered depository institution (i) the short-term
obligations of which
are rated by each of the Rating Agencies in its highest rating
at the time of
any deposit therein, or (ii) insured by the FDIC (to the limits
established by
such Corporation), the uninsured deposits in which account are
otherwise secured
such that, as evidenced by an Opinion of Counsel (obtained by
and at the expense
of the Person requesting that the account be held pursuant to
this clause (ii))
delivered to the Trustee prior to the establishment of such
account, the
Certificateholders will have a claim with respect to the funds
in such account
and a perfected first priority security interest against any
collateral (which
shall be limited to Permitted Instruments, each of which shall
mature not later
than the Business Day immediately preceding the Distribution
Date next following
the date of investment in such collateral or the Distribution
Date if such
Permitted Instrument is an obligation of the institution that
maintains the
Certificate Account or Custodial Account) securing such funds
that is superior
to claims of any other depositors or general creditors of the
depository
institution with which such account is maintained or (iii) a
trust account or
accounts maintained with a federal or state chartered depository
institution or
trust company with trust powers acting in its fiduciary capacity
or (iv) an
account or accounts of a depository institution acceptable to
the Rating
Agencies (as evidenced in writing by the Rating Agencies that
use of any such
account as the Custodial Account or the Certificate Account will
not have an
adverse effect on the then-current ratings assigned to the
Classes of the
Certificates then rated by the Rating Agencies). Eligible
Accounts may bear
interest.
"Event of Default": One or more of the events described in
Section 7.01.
"Excess Bankruptcy Loss": Any Bankruptcy Loss, or portion
thereof, which exceeds the then applicable Bankruptcy
Amount.
"Excess Fraud Loss": Any Fraud Loss, or portion thereof,
which
exceeds the then applicable Fraud Loss Amount.
"Excess Special Hazard Loss": Any Special Hazard Loss, or
portion thereof, that exceeds the then applicable Special Hazard
Amount.
"Extraordinary Events": Any of the following conditions with
respect to a Mortgaged Property or Mortgage Loan causing or
resulting in a loss
which causes the liquidation of such Mortgage Loan:
(a) losses that are of a type that would be covered by
the fidelity bond and the errors and omissions insurance policy
required to be
maintained pursuant to Section 3.18 but are in excess of the
coverage maintained
thereunder;
(b) nuclear reaction or nuclear radiation or radioactive
contamination, all whether controlled or uncontrolled, and
whether such loss be
direct or indirect, proximate or remote or be in whole or in
part caused by,
contributed to or aggravated by a peril covered by the
definition of the term
"Special Hazard Loss";
(c) hostile or warlike action in time of peace or war,
including action in hindering, combatting or defending against
an actual,
impending or expected attack:
1. by any government or sovereign power, de jure or de
facto, or by any authority maintaining or using military, naval
or air forces;
or
2. by military, naval or air forces; or
3. by an agent of any such government, power, authority
or forces;
(d) any weapon of war employing atomic fission or
radioactive force whether in time of peace or war; or
(e) insurrection, rebellion, revolution, civil war,
usurped power or action taken by governmental authority in
hindering, combatting
or defending against such an occurrence, seizure or destruction
under quarantine
or customs regulations, confiscation by order of any government
or public
authority; or risks of contraband or illegal transportation or
trade.
"Extraordinary Losses": Any loss incurred on a Mortgage Loan
caused by or resulting from an Extraordinary Event.
"Fannie Mae": Federal National Mortgage Association or any
successor.
"FDIC": Federal Deposit Insurance Corporation or any
successor.
["Fitch": Fitch Ratings, or its successor in interest.]
"Fraud Losses": Any Realized Loss sustained by reason of a
default arising from fraud, dishonesty or misrepresentation in
connection with
the related Mortgage Loan.
"Fraud Loss Amount": As of any date of determination after
the
Cut-off Date, an amount equal to: (X) up to and including the
[first]
anniversary of the Cut-off Date an amount equal to ______% of
the aggregate
outstanding principal balance of all of the Mortgage Loans as of
the Cut-off
Date minus the aggregate amount of Fraud Losses allocated to the
Class B
Certificates in accordance with Section 4.04 since the Cut-off
Date up to such
date of determination, (Y) from the [first] to the fifth
anniversary of the
Cut-off Date, an amount equal to (1) the lesser of (a) the Fraud
Loss Amount as
of the most recent anniversary of the Cut-off Date and (b)
______% of the
aggregate outstanding principal balance of all of the Mortgage
Loans as of the
most recent anniversary of the Cut-off Date minus (2) the Fraud
Losses allocated
solely to the Class B Certificates in accordance with Section
4.04 since the
most recent anniversary of the Cut-off Date up to such date of
determination. On
and after the fifth anniversary of the Cutoff Date the Fraud
Loss Amount shall
be zero.
The Fraud Loss Amount may be further reduced by the Master
Servicer (including accelerating the manner in which such
coverage is reduced)
provided that prior to any such reduction, the Master Servicer
shall (i) obtain
written confirmation from each Rating Agency that such reduction
shall not
reduce the rating assigned to any Class of Certificates by such
Rating Agency
below the lower of the then-current rating or the rating
assigned to such
Certificates as of the Closing Date by such Rating Agency and
(ii) provide a
copy of such written confirmation to the Trustee.
"Freddie Mac": Federal Home Loan Mortgage Corporation or any
successor.
"Funding Date": With respect to each Mortgage Loan, the date
on which funds were advanced by or on behalf of the Seller and
interest began to
accrue thereunder.
"Initial Certificate Principal Balance": With respect to
each
Class of Certificates, the Certificate Principal Balance of such
Class of
Certificates as of the Cut-off Date as set forth in the
Preliminary Statement
hereto.
"Insurance Policy": With respect to any Mortgage Loan, any
insurance policy which is required to be maintained from time to
time under this
Agreement in respect of such Mortgage Loan.
"Insurance Proceeds": Proceeds paid by any insurer pursuant
to
the Primary Mortgage Insurance Policy and any other 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 Mortgagor in
accordance with
the procedures that the Master Servicer would follow in
servicing mortgage loans
held for its own account.
"Late Collections": With respect to any Mortgage Loan, all
amounts received during any Due Period, whether as late payments
of Monthly
Payments or as Insurance Proceeds, Liquidation Proceeds or
otherwise, which
represent late payments or collections of Monthly Payments due
but delinquent
for a previous Due Period and not previously recovered.
"Liquidation Proceeds": Amounts (other than Insurance
Proceeds) received by the Master Servicer in connection with the
taking of an
entire Mortgaged Property by exercise of the power of eminent
domain or
condemnation or in connection with the liquidation of a
defaulted Mortgage Loan
through trustee's sale, foreclosure sale or otherwise, other
than amounts
received in respect of REO Property.
"Loan-to-Value Ratio": As of any date, the fraction,
expressed
as a percentage, the numerator of which is the current principal
balance of the
related Mortgage Loan at the date of determination and the
denominator of which
is the Collateral Value of the related Mortgaged Property.
"Master Servicer": [Name of Master Servicer], or any
successor
master servicer appointed as herein provided.
"Monthly Payment": With respect to any Mortgage Loan, the
scheduled monthly payment of principal and interest on such
Mortgage Loan which
is payable by a Mortgagor from time to time under the related
Mortgage Note as
originally executed (after adjustment, if any, for Principal
Prepayments and for
Deficient Valuations occurring prior to such Due Date, and after
any adjustment
by reason of any bankruptcy or similar proceeding or any
moratorium or similar
waiver or grace period).
["Moody's": Moody's Investors Service, Inc. or its successor
in interest.]
"Mortgage": The mortgage, deed of trust or any other
instrument securing the Mortgage Loan.
"Mortgage File": The mortgage documents listed in Section
2.01
pertaining to a particular Mortgage Loan and any additional
documents required
to be added to the Mortgage File pursuant to this Agreement;
provided, that
whenever the term "Mortgage File" is used to refer to documents
actually
received by the Trustee, such term shall not be deemed to
include such
additional documents required to be added unless they are
actually so added.
"Mortgage Loan": Each of the mortgage loans, transferred and
assigned to the Trustee pursuant to Section 2.01 or Section 2.03
and from time
to time held in the Trust Fund, the Mortgage Loans originally so
transferred,
assigned and held being identified in the Mortgage Loan Schedule
attached hereto
as Exhibit H (and any Qualified Substitute Mortgage Loans). As
used herein, the
term "Mortgage Loan" includes the related Mortgage Note and
Mortgage.
"Mortgage Loan Schedule": As of any date of determination,
the
schedule of Mortgage Loans included in the Trust Fund. The
initial schedule of
Mortgage Loans with accompanying information transferred on the
Closing Date to
the Trustee as part of the Trust Fund for the Certificates,
attached hereto as
Exhibit H (as amended from time to time to reflect the addition
of Qualified
Substitute Mortgage Loans) (and, for purposes of the Trustee's
review of the
Mortgage Files pursuant to Section 2.02, in computer-readable
form as delivered
to the Trustee), which list shall set forth the following
information, if
applicable, with respect to each Mortgage Loan:
(i) the loan number and name of the Mortgagor;
(ii) the street address, city, state and zip code of the
Mortgaged Property;
(iii) the Mortgage Rate;
(iv) the maturity date;
(v) the original principal balance;
(vi) the first payment date;
(vii) the type of Mortgaged Property;
(viii) the Monthly Payment in effect as of the Cut-off Date;
(ix) the principal balance as of the Cut-off Date;
(x) the occupancy status;
(xi) the purpose of the Mortgage Loan;
(xii) the Collateral Value of the Mortgaged Property;
(xiii) the original term to maturity;
(xiv) the paid-through date of the Mortgage Loan;
(xv) the Loan-to-Value Ratio; and
(xvi) whether or not the Mortgage Loan was underwritten
pursuant to a limited documentation program.
The Mortgage Loan Schedule shall also set forth the total of
the amounts described under (ix) above for all of the Mortgage
Loans. The
Mortgage Loan Schedule may be in the form of more than one
schedule,
collectively setting forth all of the information required. With
respect to any
Qualified Substitute Mortgage Loan, the item described in
clauses (viii) shall
be set forth as the date of substitution.
"Mortgage Note": The note or other evidence of the
indebtedness of a Mortgagor under a Mortgage Loan.
"Mortgage Rate": With respect to any Mortgage Loan, the
annual
rate at which interest accrues on such Mortgage Loan.
"Mortgaged Property": The underlying property securing a
Mortgage Loan.
"Mortgagor": The obligor or obligors on a Mortgage Note.
"Net Mortgage Rate": As to each Mortgage Loan, a per annum
rate of interest equal to the related Mortgage Rate as in effect
from time to
time minus the sum of the Servicing Fee Rate and the rate at
which the Trustee's
Fee accrues.
"Nonrecoverable Advance": Any Advance previously made or
proposed to be made in respect of a Mortgage Loan which, in the
good faith
judgment of the Master Servicer, will not or, in the case of a
proposed Advance,
would not be ultimately recoverable from related Late
Collections, Insurance
Proceeds, Liquidation Proceeds, REO Proceeds or amounts
reimbursable to the
Master Servicer pursuant to Section 4.01(b). The determination
by the Master
Servicer that it has made a Nonrecoverable Advance or that any
proposed Advance
would constitute a Nonrecoverable Advance, shall be evidenced by
an Officers'
Certificate delivered to the Company and the Trustee.
"Non-United States Person": Any Person other than a United
States Person.
"Notional Amount": As of any Distribution Date, with respect
to the Class A-5 Certificates and the Class A-7 Certificates, an
amount equal to
the aggregate Certificate Principal Balance of all Classes of
Certificates
immediately prior to such date.
"Officers' Certificate": A certificate signed by the
Chairman
of the Board, the Vice Chairman of the Board, the President or a
vice president
and by the Treasurer, the Secretary, or one of the assistant
treasurers or
assistant secretaries of the Master Servicer or of the
Sub-Servicer and
delivered to the Company and Trustee.
"Opinion of Counsel": A written opinion of counsel, who may
be
counsel for the Company or the Master Servicer, reasonably
acceptable to the
Trustee; except that any opinion of counsel relating to (a) the
qualification of
any account required to be maintained pursuant to this Agreement
as an Eligible
Account, (b) qualification of the Trust Fund as a REMIC, (c)
compliance with the
REMIC Provisions or (d) resignation of the Master Servicer
pursuant to Section
6.04 must be an opinion of counsel who (i) is in fact
independent of the Company
and the Master Servicer, (ii) does not have any direct financial
interest or any
material indirect financial interest in the Company or the
Master Servicer or in
an affiliate of either and (iii) is not connected with the
Company or the Master
Servicer as an officer, employee, director or person performing
similar
functions.
"Optimal Percentage": A fraction, expressed as a percentage,
the numerator of which is the Certificate Principal Balance of
the Class A-1
Certificates immediately prior to the applicable Distribution
Date and the
denominator of which is the aggregate Certificate Principal
Balance of all of
the Class A Certificates immediately prior to such Distribution
Date.
"Optimal Principal Distribution Amount": An amount equal to
the product of (i) the then applicable Optimal Percentage and
(ii) the Senior
Principal Distribution Amount.
"Original Senior Percentage": _______%, which is the
fraction,
expressed as a percentage, the numerator of which is the
aggregate Initial
Certificate Principal Balance of the Class A Certificates and
the denominator of
which is the aggregate Stated Principal Balance of the Mortgage
Loans.
"OTS": Office of Thrift Supervision or any successor.
"Outstanding Mortgage Loan": As to any Due Date, a Mortgage
Loan (including an REO Property) which was not the subject of a
Principal
Prepayment in full, Cash Liquidation or REO Disposition and
which was not
purchased or substituted for prior to such Due Date pursuant to
Sections 2.02 or
2.04.
"Ownership Interest": As to any Certificate, any ownership
or
security interest in such Certificate, including any interest in
such
Certificate as the Holder thereof and any other interest
therein, whether direct
or indirect, legal or beneficial, as owner or as pledgee.
"Pass-Through Rate": With respect to the Class A
Certificates
(other than the Class A-7 Certificates) and Class B Certificates
and any
Distribution Date, the per annum rate set forth in the
Preliminary Statement
hereto. With respect to the Class A-7 Certificates and any
Distribution Date, a
rate equal to the weighted average, expressed as a percentage,
of the Pool Strip
Rates of all Mortgage Loans in the Trust Fund as of the Due Date
in the month
immediately preceding the month in which such Distribution Date
occurs, weighted
on the basis of the respective Stated Principal Balances of such
Mortgage Loans,
which Stated Principal Balances shall be the Stated Principal
Balances of such
Mortgage Loans at the close of business on the immediately
preceding
Distribution Date after giving effect to the distributions
thereon allocable to
principal (or, in the case of the initial Distribution Date, at
the close of
business on the Cut-off Date). With respect to the Class A-7
Certificates and
the initial Distribution Date, the Pass-Through Rate is equal to
______% per
annum.
"Percentage Interest": With respect to any Certificate
(other
than a Class A-5, Class A-7 or Class R Certificate), the
undivided percentage
ownership interest in the related Class evidenced by such
Certificate, which
percentage ownership interest shall be equal to the initial
Certificate
Principal Balance thereof divided by the aggregate Initial
Certificate Principal
Balance of all of the Certificates of the same Class. With
respect to a Class
A-5 or Class A-7 Certificate, the undivided percentage ownership
interest in the
related Class evidenced by such Certificate, which percentage
ownership interest
shall be equal to the initial Notional Amount thereof divided by
the aggregate
initial Notional Amount of all of the Certificates of the same
Class. With
respect to a Class R Certificate, the interest in distributions
to be made with
respect to such Class evidenced thereby, expressed as a
percentage, as stated on
the face of each such Certificate.
"Permitted Instruments": Any one or more of the following:
(i) (a) direct obligations of, or obligations fully
guaranteed as to 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 and (b)
direct
obligations of, and obligations guaranteed as to timely payment
by
Freddie Mac or Fannie Mae if, at the time of investment, they
are
assigned the highest credit rating by the Rating Agencies;
(ii) repurchase obligations (the collateral for which is
held by a third party or the Trustee) with respect to any
security
described in clause (i) above, provided that the short-term
unsecured
obligations of the party agreeing to repurchase such obligations
are at
the time rated by each Rating Agency in one of its two
highest
long-term rating categories;
(iii) certificates of deposit, time deposits, demand
deposits and bankers' acceptances of any bank or trust
company
incorporated under the laws of the United States or any state
thereof
or the District of Columbia, provided that the short-term
commercial
paper of such bank or trust company (or, in the case of the
principal
depository institution in a depository institution holding
company, the
long-term unsecured debt obligations of the depository
institution
holding company) at the date of acquisition thereof has been
rated by
each Rating Agency in its highest short-term rating;
(iv) commercial paper (having original maturities of not
more than nine months) of any corporation incorporated under the
laws
of the United States or any state thereof or the District of
Columbia
which on the date of acquisition has been rated by each Rating
Agency
in its highest short- term rating;
(v) a money market fund or a qualified investment fund
rated by each Rating Agency in its highest rating available;
and
(vi) if previously confirmed in writing to the Trustee,
any other obligation or security acceptable to each Rating
Agency in
respect of mortgage pass-through certificates rated in each
Rating
Agency's highest rating category;
provided, that no such instrument shall be a Permitted
Instrument if such
instrument evidences either (a) the right to receive interest
only payments with
respect to the obligations underlying such instrument or (b)
both principal and
interest payments derived from obligations underlying such
instrument where the
principal and interest payments with respect to such instrument
provide a yield
to maturity exceeding 120% of the yield to maturity at par of
such underlying
obligation.
"Permitted Transferee": Any transferee of a Class R
Certificate other than a Disqualified Organization or a
Non-United States
Person.
"Person": Any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated
organization or
government or any agency or political subdivision thereof.
"Pool Strip Rate": With respect to each Mortgage Loan, the
rate per annum equal to the Net Mortgage Rate thereon minus
_____% per annum.
"Prepayment Assumption": A prepayment assumption of _____%
of
the standard prepayment assumption, used for determining the
accrual of original
issue discount and market discount and premium on the
Certificates for federal
income tax purposes. The standard prepayment assumption assumes
a constant rate
of prepayment of mortgage loans of 0.2% per annum of the then
outstanding
principal balance of such mortgage loans in the first month of
the life of the
mortgage loans, increasing by an additional 0.2% per annum in
each succeeding
month until the thirtieth month, and a constant 6% per annum
rate of prepayment
thereafter for the life of such mortgage loans.
"Prepayment Interest Shortfall": With respect to any
Distribution Date, for each Mortgage Loan that was the subject
of a partial
Principal Prepayment, a Principal Prepayment in full, or of a
Cash Liquidation
or an REO Disposition during the related Prepayment Period, an
amount equal to
the amount of interest that would have accrued at the applicable
Net Mortgage
Rate (i) in the case of a Principal Prepayment in full, Cash
Liquidation or REO
Disposition on the principal balance of such Mortgage Loan
immediately prior to
such prepayment (or liquidation), commencing on the date of
prepayment (or
liquidation) and ending on the last day of the month of
prepayment or
liquidation or (ii) in the case of a partial Principal
Prepayment, on the amount
of such prepayment, commencing on the date as of which the
prepayment is applied
and ending on the last day of the month of prepayment.
"Prepayment Period": As to any Distribution Date, the
calendar
month preceding the month in which such Distribution Date
occurs.
"Primary Hazard Insurance Policy": Each primary hazard
insurance policy required to be maintained pursuant to Section
3.13.
"Primary Mortgage Insurance Policy": Each primary mortgage
insurance policy required to be maintained pursuant to Section
3.13.
"Principal Prepayment": Any payment of principal made by the
Mortgagor on a Mortgage Loan which is received in advance of its
scheduled Due
Date and which is not accompanied by an amount of interest
representing
scheduled interest due on any date or dates in any month or
months subsequent to
the month of prepayment.
"Purchase Price": With respect to any Mortgage Loan (or REO
Property) required to be purchased pursuant to Section 2.02 or
2.04, an amount
equal to the sum of (i) 100% of the Stated Principal Balance
thereof, (ii)
unpaid accrued interest (or REO Imputed Interest) at the sum of
the applicable
Net Mortgage Rate, the rate at which the Trustee's Fee accrues
on the Stated
Principal Balance thereof outstanding during each Due Period
that such interest
was not paid or advanced, from the date through which interest
was last paid by
the Mortgagor or advanced and distributed to Certificateholders
together with
unpaid related Servicing Fees from the date through which
interest was last paid
by the Mortgagor, in each case to the first day of the month in
which such
Purchase Price is to be distributed, plus (iii) the aggregate of
all Advances
made in respect thereof that were not previously reimbursed.
"Qualified Insurer": An insurance company duly qualified as
such under the laws of the state of its principal place of
business and each
state having jurisdiction over such insurer in connection with
the insurance
policy issued by such insurer, duly authorized and licensed in
such states to
transact business in such states and to write the insurance
provided by the
insurance policy issued by it, approved as an insurer by the
Master Servicer, as
a Fannie Mae approved mortgage insurer and having a claims
paying ability rating
of at least "AA" by ________________ and which is acceptable to
_______________.
Any replacement insurer with respect to a Mortgage Loan must
have at least as
high a claims paying ability rating by ______________ and
_______________ as the
insurer it replaces had on the Closing Date.
"Qualified Substitute Mortgage Loan": A Mortgage Loan
substituted by the Company for a Deleted Mortgage Loan which
must, on the date
of such substitution, as confirmed in an Officers' Certificate
delivered to the
Trustee, (i) have an outstanding principal balance, after
deduction of the
principal portion of the monthly payment due in the month of
substitution (or in
the case of a substitution of more than one Mortgage Loan for a
Deleted Mortgage
Loan, an aggregate outstanding principal balance, after such
deduction), not in
excess of the Stated Principal Balance of the Deleted Mortgage
Loan (the amount
of any shortfall to be deposited by the Master Servicer, in the
Custodial
Account in the month of substitution); (ii) have a Mortgage Rate
and a Net
Mortgage Rate no lower than and not more than 1% per annum
higher than the
Mortgage Rate and Net Mortgage Rate, respectively, of the
Deleted Mortgage Loan
as of the date of substitution; (iii) have a remaining term to
stated maturity
not greater than (and not more than one year less than) that of
the Deleted
Mortgage Loan; (iv) comply with each representation and warranty
set forth in
Section 2 of the Seller's Warranty Certificate; (v) have a
Loan-to-Value Ratio
as of the date of substitution equal to or lower than the
Loan-to-Value Ratio of
the Deleted Mortgage Loan as of such date; and (vi) be covered
under a Primary
Insurance Policy if such Qualified Substitute Mortgage Loan has
a Loan-to-Value
Ratio in excess of 80%. In the event that one or more mortgage
loans are
substituted for one or more Deleted Mortgage Loans, the amounts
described in
clause (i) hereof shall be determined on the basis of aggregate
principal
balances, the Mortgage Rates described in clause (ii) hereof
shall be determined
on the basis of weighted average Mortgage Rates, the Net
Mortgage Rates
described in clause (ii) hereof shall be satisfied as to each
such mortgage
loan, the terms described in clause (iii) shall be determined on
the basis of
weighted average remaining terms to maturity, the Loan-to-Value
Ratios described
in clause (v) hereof shall be satisfied as to each such mortgage
loan and,
except to the extent otherwise provided in this sentence, the
representations
and warranties described in clause (iv) hereof must be satisfied
as to each
Qualified Substitute Mortgage Loan or in the aggregate, as the
case may be.
"Rating Agency": [Standard & Poor's] [Moody's] [Fitch].
If
either agency or a successor is no longer in existence, "Rating
Agency" shall be
such statistical credit rating agency, or other comparable
Person, designated by
the Company, notice of which designation shall be given to the
Trustee and the
Master Servicer. References herein to the two highest long term
debt rating
categories of a Rating Agency shall mean "AA" or better in the
case of [Standard
& Poor's] [Fitch] and "Aa2" or better in the case of Moody's
and references
herein to the highest short-term debt rating of a Rating Agency
shall mean "A-1"
in the case of [Standard & Poor's,] and in the case of any
other Rating Agency
such references shall mean such rating categories without regard
to any plus or
minus.
"Realized Loss": With respect to any Mortgage Loan or
related
REO Property as to which a Cash Liquidation or REO Disposition
has occurred, an
amount (not less than zero) equal to (i) the Stated Principal
Balance of the
Mortgage Loan as of the date of Cash Liquidation or REO
Disposition, plus (ii)
interest (and REO Imputed Interest, if any) at the related Net
Mortgage Rate
from the Due Date as to which interest was last paid or advanced
to
Certificateholders up to the date of the Cash Liquidation or REO
Disposition on
the Stated Principal Balance of such Mortgage Loan outstanding
during each Due
Period that such interest was not paid or advanced, minus (iii)
the proceeds, if
any, received during the month in which such Cash Liquidation or
REO Disposition
occurred, to the extent applied as recoveries of interest at the
related Net
Mortgage Rate and to principal of the Mortgage Loan, net of the
portion thereof
reimbursable to the Master Servicer or any Sub-Servicer with
respect to related
Advances not previously reimbursed. With respect to each
Mortgage Loan which has
become the subject of a Deficient Valuation, the difference
between the
principal balance of the Mortgage Loan outstanding immediately
prior to such
Deficient Valuation and the principal balance of the Mortgage
Loan as reduced by
the Deficient Valuation. With respect to each Mortgage Loan
which has become the
subject of a Debt Service Reduction, the amount of such Debt
Service Reduction.
"Record Date": The last Business Day of the month
immediately
preceding the month of the related Distribution Date.
"Regular Certificate": Any of the Certificates other than
the
Class R Certificates.
"Relief Act": The Soldiers' and Sailors' Civil Relief Act of
1940, as amended.
"Relief Act Interest Shortfall": With respect to any
Distribution Date and any Mortgage Loan, any reduction in the
amount of interest
collectible on such Mortgage Loan for the most recently ended
calendar month as
a result of the application of the Relief Act.
"REMIC": A "real estate mortgage investment conduit" within
the meaning of Section 860D of the Code.
"REMIC Provisions": Provisions of the federal income tax law
relating to real estate mortgage investment conduits, which
appear at Sections
860A through 860G of Subchapter M of Chapter 1 of the Code, and
related
provisions, and proposed, temporary and final regulations and
published rulings,
notices and announcements promulgated thereunder, as the
foregoing may be in
effect from time to time.
"Remittance Report": A report prepared by the Master
Servicer
providing the information set forth in Exhibit E attached
hereto.
"REO Acquisition": The acquisition by the Master Servicer on
behalf of the Trustee for the benefit of the Certificateholders
of any REO
Property pursuant to Section 3.15.
"REO Disposition": The receipt by the Master Servicer of
Insurance Proceeds, Liquidation Proceeds and other payments and
recoveries
(including proceeds of a final sale) which the Master Servicer
expects to be
finally recoverable from the sale or other disposition of the
REO Property.
"REO Imputed Interest": As to any REO Property, for any
period, an amount equivalent to interest (at the Mortgage Rate
that would have
been applicable to the related Mortgage Loan had it been
outstanding) on the
unpaid principal balance of the Mortgage Loan as of the date of
acquisition
thereof (as such balance is reduced by any income from the REO
Property treated
as a recovery of principal pursuant to Section 3.15).
"REO Proceeds": Proceeds, net of directly related expenses,
received in respect of any REO Property (including, without
limitation, proceeds
from the rental of the related Mortgaged Property and of any REO
Disposition),
which proceeds are required to be deposited into the Custodial
Account as and
when received.
"REO Property": A Mortgaged Property acquired by the Master
Servicer through foreclosure or deed-in-lieu of foreclosure in
connection with a
defaulted Mortgage Loan.
"Request for Release": A release signed by a Servicing
Officer, in the form of Exhibits F-1 or F-2 attached hereto.
"Required Insurance Policy": With respect to any Mortgage
Loan, any Insurance Policy or any other insurance policy that is
required to be
maintained from time to time under this Agreement or pursuant to
the provisions
of a Mortgage Loan.
"Residual Certificate": Any of the Class R Certificates.
"Responsible Officer": When used with respect to the
Trustee,
the Chairman or Vice Chairman of the Board of Directors or
Trustees, the
Chairman or Vice Chairman of the Executive or Standing Committee
of the Board of
Directors or Trustees, the President, the Chairman of the
Committee on Trust
Matters, any vice president, any assistant vice president, the
Secretary, any
assistant secretary, the Treasurer, any assistant treasurer, the
Cashier, any
assistant cashier, any trust officer or assistant trust officer,
the Controller
and any assistant controller or any other officer of the Trustee
customarily
performing functions similar to those performed by any of the
above designated
officers and also, with respect to a particular matter, any
other officer to
whom such matter is referred because of such officer's knowledge
of and
familiarity with the particular subject.
"Seller": [Name of Seller] and its successors and assigns.
"Seller's Warranty Certificate": The Seller's Warranty
Certificate of the Seller, dated ______ __, 20__, in the form of
Exhibit I
attached hereto.
"Senior Accelerated Distribution Percentage": With respect
to
any Distribution Date, the percentage indicated below:
DISTRIBUTION DATE SENIOR ACCELERATED DISTRIBUTION PERCENTAGE
[TABLE]
provided, however, (i) that any scheduled reduction to the
Senior Accelerated
Distribution Percentage described above shall not occur as of
any Distribution
Date unless either (a)(1) the outstanding principal balance of
Mortgage Loans
delinquent [60] days or more averaged over the last six months,
as a percentage
of the aggregate outstanding principal balance of all Mortgage
Loans averaged
over the last [six] months, does not exceed [2%] and (2)
Realized Losses on the
Mortgage Loans to date for such Distribution Date if occurring
during the sixth,
seventh, eighth, ninth or tenth year (or any year thereafter)
after the Closing
Date are less than [30%, 35%, 40%, 45% or 50%], respectively, of
the Initial
Certificate Principal Balance of the Class B Certificates or
(b)(1) the
outstanding principal balance of the Mortgage Loans delinquent
[60] days or more
averaged over the last six months, as a percentage of the
aggregate outstanding
principal balance of all Mortgage Loans averaged over the last
[six] months,
does not exceed [4%] and (2) Realized Losses on the Mortgage
Loans to date for
such Distribution Date are less than [10%] of the Initial
Certificate Principal
Balance of the Class B Certificates and (ii) that for any
Distribution Date on
which the Senior Percentage is greater than the Original Senior
Percentage, the
Senior Accelerated Distribution Percentage for such Distribution
Date shall be
100%. Notwithstanding the foregoing, upon the reduction of the
aggregate
Certificate Principal Balance of the Class A Certificates to
zero, the Senior
Accelerated Distribution Percentage shall thereafter be 0%.
"Senior Percentage": As of any Distribution Date, the lesser
of 100% and a fraction, expressed as a percentage, the numerator
of which is the
aggregate Certificate Principal Balance of the Class A
Certificates immediately
prior to such Distribution Date and the denominator of which is
the aggregate
Stated Principal Balance of all of the Mortgage Loans (or
related REO
Properties) immediately prior to such Distribution Date.
"Senior Principal Distribution Amount": As to any
Distribution
Date, the lesser of (a) the balance of the Available
Distribution Amount
remaining after the distribution of all amounts required to be
distributed
pursuant to Section 4.02(b)(i) and (b) the sum of the amounts
required to be
distributed to the Class A Certificateholders on such
Distribution Date pursuant
to Section 4.02(b)(ii) and (vi).
"Servicing Account": The account or accounts created and
maintained pursuant to Section 3.09.
"Servicing Advances": All customary, reasonable and
necessary
"out of pocket" costs and expenses incurred in connection with a
default,
delinquency or other unanticipated event by the Master Servicer
in the
performance of its servicing obligations, including, but not
limited to, the
cost of (i) the preservation, restoration and protection of a
Mortgaged
Property, (ii) any enforcement or judicial proceedings,
including foreclosures,
(iii) the management and liquidation of any REO Property and
(iv) compliance
with the obligations under the second paragraph of Section 3.01
and Section
3.09.
"Servicing Fee": As to each Mortgage Loan, an amount,
payable
out of any payment of interest on the Mortgage Loan, equal to
interest at the
related Servicing Fee Rate on the Stated Principal Balance of
such Mortgage Loan
for the calendar month preceding the month in which the payment
is due
(alternatively, in the event such payment of interest
accompanies a Principal
Prepayment in full made by the Mortgagor, interest for the
number of days
covered by such payment of interest).
"Servicing Fee Rate": With respect to each Mortgage Loan,
the
per annum rate of ______%.
"Servicing Officer": Any officer of the Master Servicer
involved in, or responsible for, the administration and
servicing of the
Mortgage Loans, whose name appears on a list of servicing
officers furnished to
the Trustee by the Master Servicer, as such list may from time
to time be
amended.
"Single Certificate": A Certificate of any Class evidencing
the minimum denomination for Certificates of such Class as set
forth in Section
5.01.
"Special Hazard Amount": As of any Distribution Date, an
amount equal to $___________ (the initial "Special Hazard
Amount") minus the sum
of (i) the aggregate amount of Special Hazard Losses allocated
solely to the
Class B Certificates pursuant to Section 4.04 and (ii) the
Adjustment Amount (as
defined below) as most recently calculated. For each anniversary
of the Cut-off
Date, the Adjustment Amount shall be calculated and shall be
equal to the
amount, if any, by which the amount calculated in accordance
with the preceding
sentence (without giving effect to the deduction of the
Adjustment Amount for
such anniversary) exceeds the greater of (A) the product of the
Special Hazard
Percentage for such anniversary multiplied by the outstanding
principal balance
of all of the Mortgage Loans on such anniversary and (B) twice
the outstanding
principal balance of the Mortgage Loan which has the largest
outstanding
principal balance on such Anniversary.
"Special Hazard Percentage": As of each anniversary of the
Cut-off Date, the greater of (i) 1% and (ii) the largest
percentage obtained by
dividing the aggregate outstanding principal balance on such
anniversary of the
Mortgage Loans secured by Mortgaged Properties located in a
single, five-digit
zip code area in the State of California by the outstanding
principal balance of
all the Mortgage Loans on such anniversary.
"[Standard & Poor's": Standard & Poor's, a division of
The
McGraw-Hill Companies, Inc., or its successor in interest.]
"Startup Day": The day designated as such pursuant to
Article
X hereof.
"Stated Principal Balance": With respect to any Mortgage
Loan
or related REO Property at any given time, (i) the principal
balance of the
Mortgage Loan outstanding as of the Cut-off Date, after
application of principal
payments due on or before such date, whether or not received,
minus (ii) the sum
of (a) the principal portion of the Monthly Payments due with
respect to such
Mortgage Loan or REO Property during each Due Period ending
prior to the most
recent Distribution Date which were received or with respect to
which an Advance
was made, (b) all Principal Prepayments with respect to such
Mortgage Loan or
REO Property, and all Insurance Proceeds, Liquidation Proceeds
and net income
from a REO Property to the extent applied by the Master Servicer
as recoveries
of principal in accordance with Section 3.15 with respect to
such Mortgage Loan
or REO Property, which were distributed pursuant to Section 4.01
on any previous
Distribution Date and (c) any Realized Loss with respect thereto
allocated
pursuant to Section 4.04 for any previous Distribution Date.
"Subordinate Principal Distribution Amount": With respect to
any Distribution Date and the Class B Certificates, (a) the sum
of (i) the
product of (x) the Class B Percentage and (y) the aggregate of
the amounts
calculated for such Distribution Date under clauses (1), (2) and
(3) of Section
4. 01 (b)(ii)(A); (ii) the principal collections described in
Section 4. 01
(b)(ii)(B) to the extent such collections are not otherwise
distributed to the
Senior Certificates; and (iii) the product of (x) 100% minus the
Senior
Accelerated Distribution Percentage and (z) the aggregate of all
Principal
Prepayments in Full and Curtailments received in the related
Prepayment Period;
provided, however, that such amount shall in no event exceed the
outstanding
Certificate Principal Balance of the Class B Certificates
immediately prior to
such date.
"Sub-Servicer": Any Person with which the Master Servicer
has
entered into a Sub-Servicing Agreement and which meets the
qualifications of a
Sub-Servicer pursuant to Section 3.02.
"Sub-Servicer Remittance Date": The 18th day of each month,
or
if such day is not a Business Day, the immediately preceding
Business Day.
"Sub-Servicing Account": An account established by a
Sub-Servicer which meets the requirements set forth in Section
3.08 and is
otherwise acceptable to the Master Servicer.
"Sub-Servicing Agreement": The written contract between the
Master Servicer and a Sub-Servicer and any successor
Sub-Servicer relating to
servicing and administration of certain Mortgage Loans as
provided in Section
3.02.
"Tax Returns": The federal income tax return on Internal
Revenue Service Form 1066, U.S. Real Estate Mortgage Investment
Conduit Income
Tax Return, including Schedule Q thereto, Quarterly Notice to
Residual Interest
Holders of REMIC Taxable Income or Net Loss Allocation, or any
successor forms,
to be filed on behalf of the Trust 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 provisions of federal, state or
local tax laws.
"Transfer": Any direct or indirect transfer, sale, pledge,
hypothecation or other form of assignment of any Ownership
Interest in a
Certificate.
"Transferor": Any Person who is disposing by Transfer of any
Ownership Interest in a Certificate.
"Trust Fund": The segregated pool of assets subject hereto,
constituting the primary trust created hereby and to be
administered hereunder,
with respect to which a REMIC election is to be made, consisting
of: (i) the
Mortgage Loans (exclusive of payments of principal and interest
due on or before
the Cut-off Date, if any) as from time to time are subject to
this Agreement and
all payments under and proceeds of the Mortgage Loans, together
with all
documents included in the related Mortgage File, subject to
Section 2.01; (ii)
such funds or assets as from time to time are deposited in the
Custodial Account
and the Certificate Account; (iii) any REO Property; (iv) the
Primary Mortgage
Insurance Policies, if any, Primary Hazard Insurance Policies
and all other
Insurance Policies with respect to the Mortgage Loans; and (v)
the Company's
interest in respect of the representations and warranties made
by the Seller in
the Seller's Warranty Certificate as assigned to the Trustee
pursuant to Section
2.04 hereof.
"Trustee": [Name of Trustee], or its successor in interest,
or
any successor trustee appointed as herein provided.
"Trustee's Fee": As to each Mortgage Loan and Distribution
Date, an amount, payable out of any payment of interest on the
Mortgage Loan,
equal to interest at ______% per annum on the Stated Principal
Balance of such
Mortgage Loan as of the Due Date immediately preceding the month
in which such
Distribution Date occurs.
"Uninsured Cause": Any cause of damage to property subject
to
a Mortgage such that the complete restoration of such property
is not fully
reimbursable by the hazard insurance policies or flood insurance
policies
required to be maintained pursuant to Section 3.13.
"United States Person": A citizen or resident of the United
States, a corporation, partnership or other entity created or
organized in, or
under the laws of, the United States or any political
subdivision thereof, or an
estate or trust whose income from sources without the United
States is
includable in gross income for United States federal income tax
purposes
regardless of its connection with the conduct of a trade or
business within the
United States. The term "United States" shall have the meaning
set forth in
Section 7701 of the Code or successor provisions.
"Voting Rights": The portion of the voting rights of all of
the Certificates which is allocated to any Certificate. ______%
of all of the
Voting Rights shall be allocated among Holders of the
Certificates,
respectively, other than the Class A-5, Class A-7 and Class R
Certificates, in
proportion to the outstanding Certificate Principal Balances of
their respective
Certificates; and the Holders of the Class A-5, Class A-7 and
Class R
Certificates shall be entitled to ___%, ___% and ___% of all of
the Voting
Rights, respectively, allocated among the Certificates of each
such Class in
accordance with their respective Percentage Interests.
<PAGE>
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01. Conveyance of Mortgage Loans.
The Company, as of the Closing Date, and concurrently with
the
execution and delivery hereof, does hereby assign, transfer,
sell, set over and
otherwise convey to the Trustee without recourse all the right,
title and
interest of the Company in and to the Mortgage Loans identified
on the Mortgage
Loan Schedule and all other assets included or to be included in
the Trust Fund
for the benefit of the Certificateholders. Such assignment
includes all
principal and interest received by the Master Servicer on or
with respect to the
Mortgage Loans (other than payment of principal and interest due
on or before
the Cut-off Date).
In connection with such transfer and assignment, the Company
has requested the Seller to deliver to, and deposit with the
Trustee, the
following documents or instruments:
(i) the original Mortgage Note, endorsed by the Seller
"Pay to the order of [Name of Trustee], as trustee without
recourse" or
to "Pay to the order of [Name of Trustee], as trustee for
holders of
MILA Mortgage Acceptance, Inc., Mortgage Pass-Through
Certificates,
Series 200_-_, without recourse" with all intervening
endorsements
showing a complete chain of endorsements from the originator to
the
Person endorsing it to the Trustee;
(ii) the original recorded Mortgage or, if the original
Mortgage has not been returned from the applicable public
recording
office, a copy of the Mortgage certified by the Seller to be a
true and
complete copy of the original Mortgage submitted to the title
insurance
company for recording;
(iii) a duly executed original Assignment of the Mortgage
endorsed by the Seller, without recourse, to "[Name of Trustee],
as
trustee" or to "[Name of Trustee], as trustee for holders of
MILA
Mortgage Acceptance, Inc., Mortgage Pass-Through Certificates,
Series
200_-_", with evidence of recording thereon;
(iv) the original recorded Assignment or Assignments of
the Mortgage showing a complete chain of assignment from the
originator
thereof to the Person assigning it to the Trustee or, if any
such
Assignment has not been returned from the applicable public
recording
office, a copy of such Assignment certified by the Seller to be
a true
and complete copy of the original Assignment submitted to the
title
insurance company for recording;
(v) the original lender's title insurance policy, or, if
such policy has not been issued, any one of an original or a
copy of
the preliminary title report, title binder or title commitment
on the
Mortgaged Property with the original policy of the insurance to
be
delivered promptly following the receipt thereof;
(vi) the original of any assumption, modification,
extension or guaranty agreement;
(vii) the original or a copy of the private mortgage
insurance policy or original certificate of private mortgage
insurance,
if applicable; and
(viii) if any of the documents or instruments referred to
above were executed on behalf of the Mortgagor by another
Person, the
original power of attorney or other instrument that authorized
and
empowered such Person to sign, or a copy thereof certified by
the
Seller (or by an officer of the applicable title insurance or
escrow
company) to be a true and correct copy of the original.
The Seller is obligated pursuant to the Seller's Warranty
Certificate to deliver to the Trustee: (a) either the original
recorded
Mortgage, or in the event such original cannot be delivered by
the Seller, a
copy of such Mortgage certified as true and complete by the
appropriate
recording office, in those instances where a copy thereof
certified by the
Seller was delivered to the Trustee pursuant to clause (ii)
above; and (b)
either the original Assignment or Assignments of the Mortgage,
with evidence of
recording thereon, showing a complete chain of assignment from
the originator to
the Seller, or in the event such original cannot be delivered by
the Seller, a
copy of such Assignment or Assignments certified as true and
complete by the
appropriate recording office, in those instances where copies
thereof certified
by the Seller were delivered to the Trustee pursuant to clause
(iv) above.
Notwithstanding anything to the contrary contained in this
Section 2.01, in
those instances where the public recording office retains the
original Mortgage
after it has been recorded, the Seller shall be deemed to have
satisfied its
obligations hereunder upon delivery to the Trustee of a copy of
such Mortgage
certified by the public recording office to be a true and
complete copy of the
recorded original thereof.
If any Assignment is lost or returned unrecorded to the
Trustee because of any defect therein, the Seller is required to
prepare a
substitute Assignment or cure such defect, as the case may be,
and the Trustee
shall cause such Assignment to be recorded in accordance with
this paragraph.
The Seller is required, as described in the Seller's
Warranty
Certificate, to deliver to the Trustee the original of any
documents assigned to
the Trustee pursuant to this Section 2.01 not later than 120
days after the
Closing Date.
All original documents relating to the Mortgage Loans which
are not delivered to the Trustee, to the extent delivered by the
Seller to the
Master Servicer, are and shall be held by the Master Servicer in
trust for the
benefit of the Trustee on behalf of the Certificateholders.
Except as may otherwise expressly be provided herein,
neither
the Company, the Master Servicer nor the Trustee shall (and the
Master Servicer
shall ensure that no Sub-Servicer shall) assign, sell, dispose
of or transfer
any interest in the Trust Fund or any portion thereof, or permit
the Trust Fund
or any portion thereof to be subject to any lien, claim,
mortgage, security
interest, pledge or other encumbrance of, any other Person.
It is intended that the conveyance of the Mortgage Loans by
the Company to the Trustee as provided in this Section be, and
be construed as,
a sale of the Mortgage Loans by the Company to the Trustee for
the benefit of
the Certificateholders. It is, further, not intended that such
conveyance be
deemed a pledge of the Mortgage Loans by the Company to the
Trustee to secure a
debt or other obligation of the Company. However, in the event
that the Mortgage
Loans are held to be property of the Company, or if for any
reason this
Agreement is held or deemed to create a security interest in the
Mortgage Loans,
then it is intended that, (a) this Agreement shall also be
deemed to be a
security agreement within the meaning of Articles 8 and 9 of the
New York
Uniform Commercial Code and the Uniform Commercial Code of any
other applicable
jurisdiction; (b) the conveyance provided for in this Section
shall be deemed to
be (1) a grant by the Company to the Trustee of a security
interest in all of
the Company's right (including the power to convey title
thereto), title and
interest, whether now owned or hereafter acquired, in and to (A)
the Mortgage
Loans, including the Mortgage Notes, the Mortgages, any related
insurance
policies and all other documents in the related Mortgage Files,
(B) all amounts
payable to the holders of the Mortgage Loans in accordance with
the terms
thereof and (C) all proceeds of the conversion, voluntary or
involuntary, of the
foregoing into cash, instruments, securities or other property,
including
without limitation all amounts from time to time held or
invested in the
Certificate Account or the Custodial Account, whether in the
form of cash,
instruments, securities or other property and (2) an assignment
by the Company
to the Trustee of any security interest in any and all of the
Seller's right
(including the power to convey title thereto), title and
interest, whether now
owned or hereafter acquired, in and to the property described in
the foregoing
clauses (1)(A) through (C) granted by [Name of Seller] to the
Company pursuant
to the Assignment Agreement; (c) the possession by the Trustee
or its agent of
Mortgage Notes and such other items of property as constitute
instruments,
money, negotiable documents or chattel paper shall be deemed to
be "possession
by the secured party" or possession by a purchaser or a person
designated by
such secured party, for purposes of perfecting the security
interest pursuant to
the New York Uniform Commercial Code and the Uniform Commercial
Code of any
other applicable jurisdiction (including, without limitation,
Sections 9-115,
9-305, 8-102, 8-301, 8-501 and 8-503 thereof); and (d)
notifications to persons
holding such property, and acknowledgments, receipts or
confirmations from
persons holding such property, shall be deemed notifications to,
or
acknowledgments, receipts or confirmations from, financial
intermediaries,
bailees or agents (as applicable) of the Trustee for the purpose
of perfecting
such security interest under applicable law. The Company and the
Trustee shall,
to the extent consistent with this Agreement, take such actions
as may be
necessary to ensure that, if this Agreement were deemed to
create a security
interest in the Mortgage Loans, such security interest would be
deemed to be a
perfected security interest of first priority under applicable
law and will be
maintained as such throughout the term of the Agreement.
SECTION 2.02. Acceptance of the Trust Fund by the Trustee.
The Trustee acknowledges receipt (subject to any exceptions
noted in the Initial Certification described below) of the
documents referred to
in Section 2.01 above and all other assets included in the Trust
Fund and
declares that it holds and will hold such documents and the
other documents
delivered to it constituting the Mortgage Files, and that it
holds or will hold
such other assets included in the Trust Fund (to the extent
delivered or
assigned to the Trustee), in trust for the exclusive use and
benefit of all
present and future Certificateholders.
The Trustee agrees, for the benefit of the
Certificateholders,
to review each Mortgage File on or before the Closing Date to
ascertain that all
documents required to be delivered to it are in its possession,
and the Trustee
agrees to execute and deliver to the Company and the Master
Servicer on the
Closing Date an Initial Certification in the form annexed hereto
as Exhibit C 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), (i) all
documents required to be delivered to it pursuant to this
Agreement with respect
to such Mortgage Loan are in its possession, (ii) such documents
have been
reviewed by it and appear regular on their face and relate to
such Mortgage Loan
and (iii) based on its examination and only as to the foregoing
documents, the
information set forth in items (i) - (vi) and (xiii) of the
definition of the
"Mortgage Loan Schedule" accurately reflects information set
forth in the
Mortgage File. Neither the Trustee nor the Master Servicer shall
be under any
duty to determine whether any Mortgage File should include any
of the documents
specified in clause (vi) of Section 2.01. Neither the Trustee
nor the Master
Servicer shall be under any duty or obligation to inspect,
review or examine
said documents, instruments, certificates or other papers to
determine that the
same are genuine, enforceable or appropriate for the represented
purpose or that
they have actually been recorded or that they are other than
what they purport
to be on their face.
Within 90 days of the Closing Date the Trustee shall deliver
to the Company and the Master Servicer a Final Certification in
the form annexed
hereto as Exhibit D evidencing the completeness of the Mortgage
Files, with any
applicable exceptions noted thereon.
If in the process of reviewing the Mortgage Files and
preparing the certifications referred to above the Trustee finds
any document or
documents constituting a part of a Mortgage File to be missing
or defective in
any material respect, the Trustee shall promptly notify the
Seller, the Master
Servicer and the Company. The Trustee shall promptly notify the
Seller of such
defect and request that the Seller cure any such defect within
60 days from the
date on which the Seller was notified of such defect, and if the
Seller does not
cure such defect in all material respects during such period,
request that the
Seller purchase such Mortgage Loan from the Trust Fund on behalf
of the
Certificateholders at the Purchase Price within 90 days after
the date on which
the Seller was notified of such defect. It is understood and
agreed that the
obligation of the Seller to cure a material defect in, or
purchase any Mortgage
Loan as to which a material defect in a constituent document
exists shall
constitute the sole remedy respecting such defect available
to
Certificateholders or the Trustee on behalf of
Certificateholders. The Purchase
Price for the purchased Mortgage Loan shall be deposited or
caused to be
deposited upon receipt by the Master Servicer in the Custodial
Account and, upon
receipt by the Trustee of written notification of such deposit
signed by a
Servicing Officer, the Trustee shall release or cause to be
released to the
Seller the related Mortgage File and shall execute and deliver
such instruments
of transfer or assignment, in each case without recourse, as the
Seller shall
require as necessary to vest in the Seller ownership of any
Mortgage Loan
released pursuant hereto and at such time the Trustee shall have
no further
responsibility with respect to the related Mortgage File.
SECTION 2.03. Representations, Warranties and Covenants of
the
Master Servicer and the Company.
(a) The Master Servicer hereby represents and warrants to
and covenants with the Company and the Trustee for the benefit
of
Certificateholders that:
(i) The Master Servicer is, and throughout the term
hereof shall remain, a duly organized, validly existing and in
good
standing under the laws of the State of (except as otherwise
permitted
pursuant to Section 6.02), the Master Servicer is, and shall
remain, in
compliance with the laws of each state in which any Mortgaged
Property
is located to the extent necessary to perform its obligations
under
this Agreement, and the Master Servicer is, and shall remain,
approved
to sell mortgage loans to and service mortgage loans for Fannie
Mae and
Freddie Mac;
(ii) The execution and delivery of this Agreement by the
Master Servicer, and the performance and compliance with the
terms of
this Agreement by the Master Servicer, will not violate the
Master
Servicer's articles of incorporation or bylaws or constitute a
default
(or an event which, with notice or lapse of time, or both,
would
constitute a default) under, or result in the breach of, any
material
agreement or other instrument to which it is a party or which
is
applicable to it or any of its assets;
(iii) The Master Servicer has the full power and authority
to enter into and consummate all transactions contemplated by
this
Agreement, has duly authorized the execution, delivery and
performance
of this Agreement, and has duly executed and delivered this
Agreement;
(iv) This Agreement, assuming due authorization, execution
and delivery by the Company and the Trustee, constitutes a
valid, legal
and binding obligation of the Master Servicer, enforceable
against the
Master Servicer in accordance with the terms hereof, subject to
(A)
applicable bankruptcy, insolvency, reorganization, moratorium
and other
laws affecting the enforcement of creditors' rights generally,
and (B)
general principles of equity, regardless of whether such
enforcement is
considered in a proceeding in equity or at law;
(v) The Master Servicer is not in violation of, and its
execution and delivery of this Agreement and its performance
and
compliance with the terms of this Agreement will not constitute
a
violation of, any law, any order or decree of any court or
arbiter, or
any order, regulation or demand of any federal, state or
local
governmental or regulatory authority, which violation is likely
to
affect materially and adversely either the ability of the
Master
Servicer to perform its obligations under this Agreement or
the
financial condition of the Master Servicer; (vi) No litigation
is
pending or, to the best of the Master Servicer's knowledge,
threatened
against the Master Servicer which would prohibit its entering
into this
Agreement or performing its obligations under this Agreement or
is
likely to affect materially and adversely either the ability of
the
Master Servicer to perform its obligations under this Agreement
or the
financial condition of the Master Servicer;
(vii) The Master Servicer will comply in all material
respects in the performance of this Agreement and with all
reasonable
rules and requirements of each insurer under each Insurance
Policy; and
(viii) The execution of this Agreement and the performance
of the Master Servicer's obligations hereunder do not require
any
license, consent or approval of any state or federal court,
agency,
regulatory authority or other governmental body having
jurisdiction
over the Master Servicer, other than such as have been obtained;
and
(ix) no information, certificate of an officer, statement
furnished in
writing or report delivered to the Company, any affiliate of
the
Company or the Trustee by the Master Servicer will, to the
knowledge of
the Master Servicer, contain any untrue statement of a material
fact or
omit a material fact necessary to make the information,
certificate,
statement or report not misleading.
It is understood and agreed that the representations,
warranties and covenants set forth in this Section 2.03(a) shall
survive the
execution and delivery of this Agreement, and shall inure to the
benefit of the
Company, the Trustee and the Certificateholders. Upon discovery
by the Company,
the Trustee or the Master Servicer of a breach of any of the
foregoing
representations, warranties and covenants that materially and
adversely affects
the interests of the Company or the Trustee, the party
discovering such breach
shall give prompt written notice to the other parties.
(b) The Company hereby represents and warrants to the
Master Servicer and the Trustee for the benefit of
Certificateholders that as of
the Closing Date (or, if otherwise specified below, as of the
date so
specified):
(i) Immediately prior to the assignment of the Mortgage
Loans to the Trustee, the Company had good title to, and was the
sole
owner of, each Mortgage Loan free and clear of any pledge,
lien,
encumbrance or security interest (other than rights to servicing
and
related compensation) and such assignment validly transfers
ownership
of the Mortgage Loans to the Trustee free and clear of any
pledge,
lien, encumbrance or security interest;
(ii) No Mortgage Loan is one month or more delinquent in
payment of principal and interest as of the Cut-off Date and
no
Mortgage Loan has been so delinquent more than once in the
12-month
period prior to the Cut- off Date;
(iii) The information set forth in the Mortgage Loan
Schedule with respect to each Mortgage Loan or the Mortgage
Loans, as
the case may be, is true and correct in all material respects at
the
date or dates respecting which such information is
furnished;
(iv) The Mortgage Loans are fully-amortizing, fixed-rate
mortgage loans with level Monthly Payments due on the first day
of each
month and terms to maturity at origination or modification of
not more
than 30 years;
(v) Each Mortgage Loan secured by a Mortgaged Property
with a Loan-to-Value Ratio at origination in excess of 80% is
the
subject of a Primary Mortgage Insurance Policy that insures
that
portion of the principal balance thereof that exceeds the amount
equal
to 75% of the appraised value of the related Mortgaged Property.
Each
such Primary Mortgage Insurance Policy is in full force and
effect and
the Trustee is entitled to the benefits thereunder; and
(vi) The representations and warranties of the Seller with
respect to the Mortgage Loans and the remedies therefor are as
set
forth in the Seller's Warranty Certificate.
[Other representations and warranties as applicable.]
It is understood and agreed that the representations and
warranties set forth in this Section 2.03(b) shall survive
delivery of the
respective Mortgage Files to the Trustee.
Upon discovery by either the Company, the Master Servicer or
the Trustee of a breach of any representation or warranty set
forth in this
Section 2.03 which materially and adversely affects the
interests of the
Certificateholders in any Mortgage Loan, the party discovering
such breach shall
give prompt written notice to the other parties.
SECTION 2.04. Representations and Warranties of the Seller;
Repurchase and Substitution.
The Company hereby assigns to the Trustee for the benefit of
Certificateholders its interest in respect of the
representations and warranties
made by the Seller in the Seller's Warranty Certificate or the
exhibits thereto.
Insofar as the Seller's Warranty Certificate relates to such
representations and
warranties and any remedies provided thereunder for any breach
of such
representations and warranties, such right, title and interest
may be enforced
by the Trustee on behalf of the Certificateholders. Upon the
discovery by the
Company, the Master Servicer or the Trustee of a breach of any
of the
representations and warranties made in the Seller's Warranty
Certificate in
respect of any Mortgage Loan which materially and adversely
affects the
interests of the Certificateholders in such Mortgage Loan, the
party discovering
such breach shall give prompt written notice to the other
parties. The Trustee
shall promptly notify the Seller of such breach and request that
such Seller
shall, within 90 days from the date that the Company, the Seller
or the Trustee
was notified of such breach, either (i) cure such breach in all
material
respects or (ii) purchase such Mortgage Loan from the Trust Fund
at the Purchase
Price and in the manner set forth in Section 2.02; provided that
in the case of
such breach, the Seller shall have the option to substitute a
Qualified
Substitute Mortgage Loan or Loans for such Mortgage Loan if such
substitution
occurs within two years following the Closing Date. Any such
substitution must
occur within 90 days from the date the Seller was notified of
the breach if such
90 day period expires before two years following the Closing
Date. In the event
that the Seller elects to substitute a Qualified Substitute
Mortgage Loan or
Loans for a Deleted Mortgage Loan pursuant to this Section 2.04,
the Seller
shall deliver to the Trustee for the benefit of the
Certificateholders with
respect to such Qualified Substitute Mortgage Loan or Loans, the
original
Mortgage Note, the Mortgage, an Assignment of the Mortgage in
recordable form,
and such other documents and agreements as are required by
Section 2.01, with
the Mortgage Note endorsed as required by Section 2.01. No
substitution will be
made in any calendar month after the Determination Date for such
month. Monthly
Payments due with respect to Qualified Substitute Mortgage Loans
in the month of
substitution shall not be part of the Trust Fund and will be
retained by the
Master Servicer and remitted by the Master Servicer to the
Seller on the next
succeeding Distribution Date.
For the month of substitution, distributions to
Certificateholders will include the Monthly Payment due on a
Deleted Mortgage
Loan for such month and thereafter the Seller shall be entitled
to retain all
amounts received in respect of such Deleted Mortgage Loan. The
Company shall
amend or cause to be amended the Mortgage Loan Schedule for the
benefit of the
Certificateholders to reflect the removal of such Deleted
Mortgage Loan and the
substitution of the Qualified Substitute Mortgage Loan or Loans
and the Company
shall deliver the amended Mortgage Loan Schedule, to the
Trustee. Upon such
substitution, the Qualified Substitute Mortgage Loan or Loans
shall be subject
to the terms of this Agreement in all respects, the Seller shall
be deemed to
have made the representations and warranties with respect to the
Qualified
Substitute Mortgage Loan contained in the Seller's Warranty
Certificate as of
the date of substitution, and the Company shall be deemed to
have made with
respect to any Qualified Substitute Mortgage Loan or Loans, as
of the date of
substitution, the representations and warranties set forth in
Section 2.03
hereof, and the Seller shall be obligated to repurchase or
substitute for any
Qualified Substitute Mortgage Loan as to which a repurchase or
substitution
obligation has occurred pursuant to Section 3 of the Seller's
Warranty
Certificate.
In connection with the substitution of one or more Qualified
Substitute Mortgage Loans for one or more Deleted Mortgage
Loans, the Master
Servicer will determine the amount (if any) by which the
aggregate principal
balance of all such Qualified Substitute Mortgage Loans as of
the date of
substitution is less than the aggregate Stated Principal Balance
of all such
Deleted Mortgage Loans (in each case after application of the
principal portion
of the Monthly Payments due in the month of substitution that
are to be
distributed to Certificateholders in the month of substitution).
The Seller
shall provide the Master Servicer on the day of substitution for
immediate
deposit in to the Custodial Account the amount of such
shortfall, without any
reimbursement therefor. The Seller shall give notice in writing
to the Trustee
of such event, which notice shall be accompanied by an Officers'
Certificate as
to the calculation of such shortfall and by an Opinion of
Counsel to the effect
that such substitution will not cause (a) any federal tax to be
imposed on the
Trust Fund, including without limitation, any federal tax
imposed on "prohibited
transactions" under Section 860F(a)(1) of the Code or on
"contributions after
the startup date" under Section 860G(d)(1) of the Code or (b)
any portion of the
Trust Fund to fail to qualify as a REMIC at any time that any
Certificate is
outstanding. The costs of any substitution as described above,
including any
related assignments, opinions or other documentation in
connection therewith
shall be borne by the Seller.
Except as expressly set forth herein neither the Trustee nor
the Master Servicer is under any obligation to discover any
breach of the above
mentioned representations and warranties. It is understood and
agreed that the
obligation of the Seller to cure such breach or to so purchase
or substitute for
any Mortgage Loan as to which such a breach has occurred and is
continuing shall
constitute the sole remedy respecting such breach available
to
Certificateholders or the Trustee on behalf of
Certificateholders. In addition,
if the first scheduled Monthly Payment is due during the first
month after its
closing date (as such term is used in the Seller's Warranties
Certificate) and
such Monthly Payment is not received by the Master Servicer
within 30 days of
the due date in accordance with the terms of the related
Mortgage Note, the
Master Servicer shall promptly notify the Seller and the Trustee
and the Seller
shall purchase such Mortgage Loan from the Trust Fund at the
Purchase Price or
substitute a Qualified Substitute Mortgage Loan therefor within
15 days from the
date that the Seller was notified.
SECTION 2.05. Issuance of Certificates Evidencing Interests
in
the Trust Fund.
The Trustee acknowledges the assignment to it of the
Mortgage
Loans and the delivery of the Mortgage Files to it together with
the assignment
to it of all other assets included in the Trust Fund, receipt of
which is hereby
acknowledged. Concurrently with such delivery and in exchange
therefor, the
Trustee, pursuant to the written request of the Company executed
by an officer
of the Company, has executed and caused to be authenticated, and
delivered to or
upon the order of the Company, the Certificates in authorized
denominations
which evidence ownership of the entire Trust Fund.
<PAGE>
ARTICLE III
ADMINISTRATION AND SERVICING OF THE TRUST FUND
SECTION 3.01. Master Servicer to Act as Master Servicer.
The Master Servicer shall service and administer the
Mortgage
Loans for the benefit of the Certificateholders, in accordance
with this
Agreement and the customary and usual standards of practice of
prudent
institutional mortgage lenders servicing comparable mortgage
loans for their own
account in the respective states in which the Mortgaged
Properties are located.
Subject to the foregoing, the Master Servicer shall have full
power and
authority, acting alone and/or through Sub-Servicers as provided
in Section
3.02, to do or cause to be done any and all things in connection
with such
servicing and administration that it may deem necessary or
desirable. Without
limiting the generality of the foregoing, the Master Servicer in
its own name or
in the name of a Sub-Servicer is hereby authorized and empowered
by the Trustee
when the Master Servicer believes it appropriate in its best
judgment, to (i)
execute and deliver, on behalf of the Certificateholders and the
Trustee or any
of them, any and all instruments of satisfaction or
cancellation, or of partial
or full release or discharge, and all other comparable
instruments, with respect
to the Mortgage Loans and the Mortgaged Properties, (ii)
institute foreclosure
proceedings or obtain a deed-in-lieu of foreclosure so as to
convert the
ownership of such properties, and (iii) hold or cause to be held
title to such
properties, on behalf of the Trustee and Certificateholders. The
Master Servicer
shall service and administer the Mortgage Loans in accordance
with applicable
state and federal law and shall provide to the Mortgagors any
reports required
to be provided to them thereby. Subject to Section 3.16, the
Trustee shall
furnish to the Master Servicer and any Sub-Servicer any powers
of attorney and
other documents necessary or appropriate to enable the Master
Servicer and any
Sub- Servicer to carry out their servicing and administrative
duties hereunder.
The Trustee shall not be responsible for any action taken by the
Master Servicer
or any Sub-Servicer pursuant to the application of such powers
of attorney. In
accordance with the standards of the preceding paragraph, the
Master Servicer
shall advance or cause to be advanced funds as necessary for the
purpose of
effecting the payment of taxes and assessments on the Mortgaged
Properties,
which advances shall be reimbursable in the first instance from
related
collections from the Mortgagors pursuant to Section 3.09, and
further as
provided in Section 3.11. No costs incurred by the Master
Servicer or by Sub-
Servicers in effecting the payment of taxes and assessments on
the Mortgaged
Properties shall, for the purpose of calculating distributions
to
Certificateholders, be added to the amount owing under the
related Mortgage
Loans, notwithstanding that the terms of such Mortgage Loans so
permit.
The Master Servicer shall not (unless the Mortgagor is in
default with respect to the Mortgage Loan or such default is, in
the judgment of
the Master Servicer, reasonably foreseeable) make or permit any
modification,
waiver or amendment of any term of any Mortgage Loan that would
both (i) effect
an exchange or reissuance of such Mortgage Loan under Section
1001 of the Code
(or final, temporary or proposed Treasury regulations
promulgated thereunder)
and (ii) cause the Trust Fund to fail to qualify as a REMIC
under the Code or
the imposition of any tax on "prohibited transactions" or
"contributions" after
the startup date under the REMIC Provisions.
The Master Servicer may approve a request for a partial
release of the Mortgaged Property, easement, consent to
alteration or demolition
and other similar matters if it has determined, exercising its
good faith
business judgement in the same manner as it would if it were the
owner of the
related Mortgage Loan, that such approval will not adversely
affect the security
for, or the timely and full collectability of, the related
Mortgage Loan. Any
fee collected by the Master Servicer for processing such request
will be
retained by the Master Servicer as additional servicing
compensation.
The relationship of the Master Servicer (and of any
successor
to the Master Servicer under this Agreement) to the Trustee
under this Agreement
is intended by the parties to be that of an independent
contractor and not that
of a joint venturer, partner or agent.
SECTION 3.02. Sub-Servicing Agreements Between Master
Servicer
and Sub- Servicers.
(a) The Master Servicer may enter into Sub-Servicing
Agreements with Sub- Servicers for the servicing and
administration of the
Mortgage Loans and for the performance of any and all other
activities of the
Master Servicer hereunder. Each Sub-Servicer shall be either (i)
an institution
the accounts of which are insured by the FDIC or (ii) another
entity that
engages in the business of originating or servicing mortgage
loans, and in
either case shall be authorized to transact business in the
state or states in
which the related Mortgaged Properties it is to service are
situated, if and to
the extent required by applicable law to enable the Sub-Servicer
to perform its
obligations hereunder and under the Sub-Servicing Agreement, and
in either case
shall be a Freddie Mac or Fannie Mae approved mortgage servicer.
Each
Sub-Servicing Agreement must impose on the Sub-Servicer
requirements conforming
to the provisions set forth in Section 3.08 and provide for
servicing of the
Mortgage Loans consistent with the terms of this Agreement. With
the consent of
the Trustee, which consent shall not be unreasonably withheld,
the Master
Servicer and the Sub-Servicers may enter into Sub-Servicing
Agreements and make
amendments to the Sub-Servicing Agreements or enter into
different forms of
Sub-Servicing Agreements; provided, however, that any such
amendments or
different forms shall be consistent with and not violate the
provisions of this
Agreement.
(b) As part of its servicing activities hereunder, the
Master Servicer, for the benefit of the Trustee and the
Certificateholders,
shall enforce the obligations of each Sub-Servicer under the
related
Sub-Servicing Agreement, including, without limitation, any
obligation to make
advances in respect of delinquent payments as required by a
Sub-Servicing
Agreement, or to purchase a Mortgage Loan on account of
defective documentation
or on account of a breach of a representation or warranty, as
described in
Section 2.02. Such enforcement, including, without limitation,
the legal
prosecution of claims, termination of Sub-Servicing Agreements
and the pursuit
of other appropriate remedies, shall be in such form and carried
out to such an
extent and at such time as the Master Servicer, in its good
faith business
judgment, would require were it the owner of the related
Mortgage Loans. The
Master Servicer shall pay the costs of such enforcement at its
own expense, but
shall be reimbursed therefor only (i) from a general recovery
resulting from
such enforcement only to the extent, if any, that such recovery
exceeds all
amounts due in respect of the related Mortgage Loans or (ii)
from a specific
recovery of costs, expenses or attorneys' fees against the party
against whom
such enforcement is directed.
SECTION 3.03. Successor Sub-Servicers.
The Master Servicer shall be entitled to terminate any
Sub-Servicing Agreement and the rights and obligations of any
Sub-Servicer
pursuant to any Sub-Servicing Agreement in accordance with the
terms and
conditions of such Sub-Servicing Agreement. In the event of
termination of any
Sub-Servicer, all servicing obligations of such Sub-Servicer
shall be assumed
simultaneously by the Master Servicer without any act or deed on
the part of
such Sub-Servicer or the Master Servicer, and the Master
Servicer either shall
service directly the related Mortgage Loans or shall enter into
a Sub-Servicing
Agreement with a successor Sub-Servicer which qualifies under
Section 3.02.
SECTION 3.04. Liability of the Master Servicer.
Notwithstanding any Sub-Servicing Agreement, any of the
provisions of this Agreement relating to agreements or
arrangements between the
Master Servicer and a Sub-Servicer or reference to actions taken
through a
Sub-Servicer or otherwise, the Master Servicer shall remain
obligated and
primarily liable to the Trustee and Certificateholders for the
servicing and
administering of the Mortgage Loans in accordance with the
provisions of Section
3.01 without diminution of such obligation or liability by
virtue of such
Sub-Servicing Agreements or arrangements or by virtue of
indemnification from
the Sub-Servicer and to the same extent and under the same terms
and conditions
as if the Master Servicer alone were servicing and administering
the Mortgage
Loans. For purposes of this Agreement, the Master Servicer shall
be deemed to
have received payments on Mortgage Loans when the Sub-Servicer
has received such
payments. The Master Servicer shall be entitled to enter into
any agreement with
a Sub-Servicer for indemnification of the Master Servicer by
such Sub-Servicer
and nothing contained in this Agreement shall be deemed to limit
or modify such
indemnification.
SECTION 3.05. No Contractual Relationship Between
Sub-Servicers and Trustee or Certificateholders.
Any Sub-Servicing Agreement that may be entered into and any
transactions or services relating to the Mortgage Loans
involving a Sub-Servicer
in its capacity as such and not as an originator shall be deemed
to be between
the Sub-Servicer and the Master Servicer alone, and the Trustee
and
Certificateholders shall not be deemed parties thereto and shall
have no claims,
rights, obligations, duties or liabilities with respect to the
Sub-Servicer
except as set forth in Section 3.06.
SECTION 3.06. Assumption or Termination of Sub-Servicing
Agreements by Trustee.
In the event the Master Servicer shall for any reason no
longer be the master servicer (including by reason of an Event
of Default), the
Trustee or its designee shall thereupon assume all of the rights
and obligations
of the Master Servicer under each Sub-Servicing Agreement that
the Master
Servicer may have entered into, unless the Trustee is then
permitted and elects
to terminate any Sub-Servicing Agreement in accordance with its
terms. The
Trustee, its designee or the successor servicer for the Trustee
shall be deemed
to have assumed all of the Master Servicer's interest therein
and to have
replaced the Master Servicer as a party to each Sub-Servicing
Agreement to the
same extent as if the Sub-Servicing Agreements had been assigned
to the assuming
party, except that the Master Servicer shall not thereby be
relieved of any
liability or obligations under the Sub-Servicing Agreements, and
the Master
Servicer shall continue to be entitled to any rights or benefits
which arose
prior to its termination as master servicer.
The Master Servicer at its expense shall, upon request of
the
Trustee, deliver to the assuming party all documents and records
relating to
each Sub-Servicing Agreement and the Mortgage Loans then being
serviced and an
accounting of amounts collected and held by it and otherwise use
its best
efforts to effect the orderly and efficient transfer of the
Sub-Servicing
Agreements to the assuming party.
SECTION 3.07. Collection of Certain Mortgage Loan Payments.
The Master Servicer shall make reasonable efforts to collect
all payments called for under the terms and provisions of the
Mortgage Loans,
and shall, to the extent such procedures shall be consistent
with this Agreement
and the terms and provisions of any related Insurance Policy,
follow such
collection procedures as it would follow with respect to
mortgage loans
comparable to the Mortgage Loans and held for its own account.
The Master
Servicer shall not be required to institute or join in
litigation with respect
to collection of any payment (whether under a Mortgage, Mortgage
Note, Primary
Hazard Insurance Policy, Primary Mortgage Insurance Policy or
otherwise or
against any public or governmental authority with respect to a
taking or
condemnation) if it reasonably believes that it is prohibited by
applicable law
from enforcing the provision of the Mortgage or other instrument
pursuant to
which such payment is required. Consistent with the foregoing,
the Master
Servicer may in its discretion waive any prepayment fees, late
payment charge or
other charge, except as otherwise required under applicable law.
The Master
Servicer shall be responsible for preparing and distributing all
information
statements relating to payments on the Mortgage Loans, in
accordance with all
applicable federal and state tax laws and regulations.
SECTION 3.08. Sub-Servicing Accounts.
In those cases where a Sub-Servicer is servicing a Mortgage
Loan pursuant to a Sub-Servicing Agreement, the Sub-Servicer
will be required to
establish and maintain one or more accounts (collectively, the
"Sub-Servicing
Account"). The Sub-Servicing Account shall be an Eligible
Account and shall
otherwise be acceptable to the Master Servicer. All amounts held
in a
Sub-Servicing Account shall be held in trust for the Trustee for
the benefit of
the Certificateholders. The Sub-Servicer will be required to
deposit into the
Sub-Servicing Account no later than the first Business Day after
receipt all
proceeds of Mortgage Loans received by the Sub-Servicer, less
its servicing
compensation and any unreimbursed expenses and advances, to the
extent permitted
by the Sub-Servicing Agreement. On each Sub-Servicer Remittance
Date the
Sub-Servicer will be required to remit to the Master Servicer
for deposit into
the Custodial Account all funds held in the Sub-Servicing
Account with respect
to any Mortgage Loan as of the Sub-Servicer Remittance Date,
after deducting
from such remittance an amount equal to the servicing
compensation and
unreimbursed expenses and advances to which it is then entitled
pursuant to the
related Sub- Servicing Agreement, to the extent not previously
paid to or
retained by it. In addition, on each Sub-Servicer Remittance
Date the
Sub-Servicer will be required to remit to the Master Servicer
any amounts
required to be advanced pursuant to the related Sub-Servicing
Agreement. The
Sub-Servicer will also be required to remit to the Master
Servicer, within one
Business Day of receipt, the proceeds of any Principal
Prepayment made by the
Mortgagor and any Insurance Proceeds or Liquidation
Proceeds.
SECTION 3.09. Collection of Taxes, Assessments and Similar
Items; Servicing Accounts.
The Master Servicer and the Sub-Servicers shall establish
and
maintain one or more accounts (the "Servicing Accounts"), and
shall deposit and
retain therein all collections from the Mortgagors (or related
advances from
Sub- Servicers) for the payment of taxes, assessments, Primary
Hazard Insurance
Policy premiums, and comparable items for the account of the
Mortgagors, to the
extent that the Master Servicer customarily escrows for such
amounts.
Withdrawals of amounts so collected from a Servicing Account may
be made only to
(i) effect payment of taxes, assessments, Primary Hazard
Insurance Policy
premiums and comparable items; (ii) reimburse the Master
Servicer (or a
Sub-Servicer to the extent provided in the related Sub-Servicing
Agreement) out
of related collections for any payments made pursuant to
Sections 3.01 (with
respect to taxes and assessments) and 3.13 (with respect to
Primary Hazard
Insurance Policies); (iii) refund to Mortgagors any sums as may
be determined to
be overages; or (iv) clear and terminate the Servicing Account
at the
termination of this Agreement pursuant to Section 9.01. As part
of its servicing
duties, the Master Servicer or Sub-Servicers shall, if and to
the extent
required by law, pay to the Mortgagors interest on funds in
Servicing Accounts
from its or their own funds, without any reimbursement
therefor.
SECTION 3.10. Custodial Account.
(a) The Master Servicer shall establish and maintain one
or more accounts (collectively, the "Custodial Account") in
which the Master
Servicer shall deposit or cause to be deposited no later than
the first Business
Day after receipt or as and when received from the
Sub-Servicers, the following
payments and collections received or made by or on behalf of it
subsequent to
the Cut-off Date, or received by it prior to the Cut-off Date
but allocable to a
period subsequent thereto (other than in respect of principal
and interest on
the Mortgage Loans due on or before the Cut-off Date):
(i) all payments on account of principal, including
Principal Prepayments, on the Mortgage Loans;
(ii) all payments on account of interest on the Mortgage
Loans, not including any portion thereof representing interest
on
account of the related Servicing Fee Rate;
(iii) all Insurance Proceeds, other than proceeds that
represent reimbursement of costs and expenses incurred by the
Master
Servicer in connection with presenting claims under the
related
Insurance Policies, Liquidation Proceeds and REO Proceeds; (iv)
all
proceeds of any Mortgage Loan or REO Property repurchased or
purchased
in accordance with Sections 2.02, 2.04 or 9.01 and all amounts
required
to be deposited in connection with the substitution of a
Qualified
Substitute Mortgage Loan pursuant to Section 2.04;
(v) any amounts required to be deposited in the Custodial
Account pursuant to Section 3.12, 3.13 or 3.22; and
(vi) all amounts transferred from the Certificate Account
to the Custodial Account in accordance with Sections
4.01(b).
For purposes of the immediately preceding sentence, the
Cut-off Date with respect to any Qualified Substitute Mortgage
Loan shall be
deemed to be the date of substitution.
The foregoing requirements for deposit in the Custodial Account
shall be
exclusive. In the event the Master Servicer shall deposit in the
Custodial
Account any amount not required to be deposited therein, it may
withdraw such
amount from the Custodial Account, any provision herein to the
contrary
notwithstanding. The Custodial Account shall be maintained as a
segregated
account, separate and apart from trust funds created for
mortgage pass-through
certificates of other series, and the other accounts of the
Master Servicer.
(b) Funds in the Custodial Account may be invested in
Permitted Instruments in accordance with the provisions set
forth in Section
3.12. The Master Servicer shall give notice to the Trustee and
the Company of
the location of the Custodial Account after any change
thereof.
(c) Payments in the nature of late payment charges,
prepayment fees, assumption fees and reconveyance fees received
on the Mortgage
Loans shall not be deposited in the Custodial Account, but
rather shall be
received and held by the Master Servicer as additional servicing
compensation.
SECTION 3.11. Permitted Withdrawals From the Custodial
Account.
The Master Servicer may, from time to time as provided
herein,
make withdrawals from the Custodial Account of amounts on
deposit therein
pursuant to Section 3.10 that are attributable to the Mortgage
Loans for the
following purposes:
(i) to make deposits into the Certificate Account in the
amounts and in the manner provided for in Section 4.01, such
deposit to
include interest collections on the Mortgage Loans at the Net
Mortgage
Rate [and net of amounts reimbursed therefrom];
(ii) to pay to itself, the Company, the Seller or any
other appropriate person, as the case may be, with respect to
each
Mortgage Loan that has previously been purchased, repurchased
or
replaced pursuant to Sections 2.02, 2.04 or 9.01 all amounts
received
thereon and not yet distributed as of the date of purchase,
repurchase
or substitution;
(iii) to reimburse itself or any Sub-Servicer for Advances
not previously reimbursed, the Master Servicer's or any
Sub-Servicer's
right to reimbursement pursuant to this clause (iii) being
limited to
amounts received which represent Late Collections (net of the
related
Servicing Fees) of Monthly Payments on Mortgage Loans with
respect to
which such Advances were made and as further provided in Section
3.15;
(iv) to reimburse or pay itself, the Trustee or the
Company for expenses incurred by or reimbursable to the
Master
Servicer, the Trustee or the Company pursuant to Sections 3.22,
6.03,
8.05, 10.01(c) or 10.01(g), except as otherwise provided in
such
Sections;
(v) to reimburse itself or any Sub-Servicer for costs and
expenses incurred by or reimbursable to it relating to the
prosecution
of any claims pursuant to Section 3.13 that are in excess of
the
amounts so recovered;
(vi) to reimburse itself or any Sub-Servicer for unpaid
Servicing Fees and unreimbursed Servicing Advances, the
Master
Servicer's or any Sub-Servicer's right to reimbursement pursuant
to
this clause (vi) with respect to any Mortgage Loan being limited
to
late recoveries of the payments for which such advances were
made
pursuant to Section 3.01 or Section 3.09 and any other related
Late
Collections;
(vii) to pay itself as servicing compensation (in addition
to the Servicing Fee), on or after each Distribution Date, any
interest
or investment income earned on funds deposited in the Custodial
Account
for the period ending on such Distribution Date, subject to
Section
8.05;
(viii) to reimburse itself or any Sub-Servicer for any
Advance previously made which itself has determined to be a
Nonrecoverable Advance, provided that either (a) such Advance
was made
with respect to a delinquency that ultimately constituted an
Excess
Special Hazard Loss, Excess Fraud Loss, Excess Bankruptcy Loss
or
Extraordinary Loss, or (b) the Certificate Principal Balances of
the
Class B Certificates have been reduced to zero; and
(ix) to clear and terminate the Custodial Account at the
termination of this Agreement pursuant to Section 9.01.
The Master Servicer shall keep and maintain separate
accounting records on a Mortgage Loan by Mortgage Loan basis,
for the purpose of
justifying any withdrawal from the Custodial Account pursuant to
such clauses
(ii), (iii), (iv), (v), (vi), (vii) and (viii).
In connection with clause (viii) above, the Trustee shall
notify the Master Servicer if and when the Certificate Principal
Balances of the
Class B Certificates have been reduced to zero.
SECTION 3.12. Permitted Instruments.
Any institution maintaining the Custodial Account shall at
the
direction of the Master Servicer invest the funds in such
account in Permitted
Instruments, each of which shall mature not later than the
Business Day
immediately preceding the Distribution Date next following the
date of such
investment (except that if such Permitted Instrument is an
obligation of the
institution that maintains such account, then such Permitted
Instrument shall
mature not later than such Distribution Date) and shall not be
sold or disposed
of prior to its maturity. All income and gain realized from any
such investment
as well as any interest earned on deposits in the Custodial
Account shall be for
the benefit of the Master Servicer. The Master Servicer shall
deposit in the
Custodial Account (with respect to investments made hereunder of
funds held
therein) an amount equal to the amount of any loss incurred in
respect of any
such investment immediately upon realization of such loss
without right of
reimbursement.
SECTION 3.13. Maintenance of Primary Mortgage Insurance and
Primary Hazard Insurance.
(a) The Master Servicer shall not take, or permit any
Sub-Servicer to take, any action which would result in
non-coverage under any
applicable Primary Mortgage Insurance Policy of any loss which,
but for the
actions of the Master Servicer or Sub-Servicer, would have been
covered
thereunder. To the extent coverage is available, the Master
Servicer shall keep
or cause to be kept in full force and effect each such Primary
Mortgage
Insurance Policy until the principal balance of the related
Mortgage Loan
secured by a Mortgaged Property is reduced to 75% or less of the
Collateral
Value in the case of such a Mortgage Loan having a Loan-to-Value
Ratio at
origination in excess of 80%. The Master Servicer shall not
cancel or refuse to
renew any such Primary Mortgage Insurance Policy, or consent to
any Sub-Servicer
canceling or refusing to renew any such Primary Mortgage
Insurance Policy
applicable to a Mortgage Loan subserviced by it, that is in
effect at the date
of the initial issuance of the Certificates and is required to
be kept in force
hereunder unless the replacement Primary Mortgage Insurance
Policy for such
canceled or non-renewed policy is maintained with a Qualified
Insurer.
(b) In connection with its activities as administrator
and servicer of the Mortgage Loans, the Master Servicer agrees
to present or to
cause the related Sub-Servicer to present, on behalf of the
Master Servicer, the
Sub-Servicer, if any, the Trustee and Certificateholders, claims
to the insurer
under any Primary Mortgage Insurance Policies, in a timely
manner in accordance
with such policies, and, in this regard, to take or cause to be
taken such
reasonable action as shall be necessary to permit recovery under
any Primary
Mortgage Insurance Policies respecting defaulted Mortgage Loans.
Pursuant to
Section 3. 10, any Insurance Proceeds collected by or remitted
to the Master
Servicer under any Primary Mortgage Insurance Policies shall be
deposited in the
Custodial Account, subject to withdrawal pursuant to Section
3.11.
(c) The Master Servicer shall cause to be maintained for
each Mortgage Loan primary hazard insurance with extended
coverage on the
related Mortgaged Property in an amount equal to the lesser of
100% of the
replacement value of the improvements, as determined by the
insurance company,
on such Mortgaged Property or the unpaid principal balance of
the Mortgage Loan.
The Master Servicer shall also cause to be maintained on
property acquired upon
foreclosure, or deed in lieu of foreclosure, of any Mortgage
Loan, fire
insurance with extended coverage in an amount equal to the
replacement value of
the improvements thereon. Pursuant to Section 3.10, any amounts
collected by the
Master Servicer under any such policies (other than amounts to
be applied to the
restoration or repair of the related Mortgaged Property or
property thus
acquired or amounts released to the Mortgagor in accordance with
the Master
Servicer's normal servicing procedures) shall be deposited in
the Custodial
Account, subject to withdrawal pursuant to Section 3.11. Any
cost incurred by
the Master Servicer in maintaining any such insurance shall not,
for the purpose
of calculating monthly distributions to Certificateholders, be
added to the
amount owing under the Mortgage Loan, notwithstanding that the
terms of the
Mortgage Loan so permit. It is understood and agreed that no
earthquake or other
additional insurance is to be required of any Mortgagor or
maintained on
property acquired in respect of a Mortgage Loan other than
pursuant to such
applicable laws and regulations as shall at any time be in force
and as shall
require such additional insurance. When the improvements
securing a Mortgage
Loan are located at the time of origination of such Mortgage
Loan in a federally
designated special flood hazard area, the Master Servicer shall
cause flood
insurance (to the extent available) to be maintained in respect
thereof. Such
flood insurance shall be in an amount equal to the lesser of (i)
the replacement
value of the improvements, which are part of such Mortgaged
Property on a
replacement cost basis and (ii) the maximum amount of such
insurance available
for the related Mortgaged Property under the national flood
insurance program
(assuming that the area in which such Mortgaged Property is
located is
participating in such program).
In the event that the Master Servicer shall obtain and
maintain a blanket fire insurance policy with extended coverage
insuring against
hazard losses on all of the Mortgage Loans, it shall
conclusively be deemed to
have satisfied its obligations as set forth in the first two
sentences of this
Section 3.13, it being understood and agreed that such policy
may contain a
deductible clause, in which case the Master Servicer shall, in
the event that
there shall not have been maintained on the related Mortgaged
Property a policy
complying with the first two sentences of this Section 3.13 and
there shall have
been a loss which would have been covered by such policy,
deposit in the
Certificate Account the amount not otherwise payable under the
blanket policy
because of such deductible clause. Any such deposit by the
Master Servicer shall
be made on the Certificate Account Deposit Date next preceding
the Distribution
Date which occurs in the month following the month in which
payments under any
such policy would have been deposited in the Custodial Account.
In connection
with its activities as administrator and servicer of the
Mortgage Loans, the
Master Servicer agrees to present, on behalf of itself, the
Trustee and
Certificateholders, claims under any such blanket policy.
SECTION 3.14. Enforcement of Due-on-Sale Clauses; Assumption
Agreements.
The Master Servicer will, to the extent it has knowledge of
any conveyance or prospective conveyance by any Mortgagor of the
Mortgaged
Property (whether by absolute conveyance or by contract of sale,
and whether or
not the Mortgagor remains or is to remain liable under the
Mortgage Note or the
Mortgage), exercise or cause to be exercised its rights to
accelerate the
maturity of such Mortgage Loan under any "due-on-sale" clause
applicable
thereto; provided, however, that the Master Servicer shall not
exercise any such
rights if it reasonably believes that it is prohibited by law
from doing so or
if such enforcement will adversely affect or jeopardize required
coverage under
the Insurance Policies. If the Master Servicer is unable to
enforce such "due-
on-sale" clause (as provided in the previous sentence) or if no
"due-on-sale"
clause is applicable, the Master Servicer or the Sub-Servicer
will enter into an
assumption and modification agreement with the Person to whom
such property has
been conveyed or is proposed to be conveyed, pursuant to which
such Person
becomes liable under the Mortgage Note and, to the extent
permitted by
applicable state law, the Mortgagor remains liable thereon;
provided, however,
that the Master Servicer shall not enter into any assumption and
modification
agreement if the coverage provided under the Primary Insurance
Policy, if any,
would be impaired by doing so. The Master Servicer is also
authorized to enter
into a substitution of liability agreement with such Person,
pursuant to which
the original Mortgagor is released from liability and such
Person is substituted
as the Mortgagor and becomes liable under the Mortgage Note, if
the Master
Servicer shall have determined in good faith that such
substitution will not
adversely affect the collectability of the Mortgage Loan. Any
fee collected by
or on behalf of the Master Servicer for entering into an
assumption or
substitution of liability agreement will be retained by or on
behalf of the
Master Servicer as additional servicing compensation. In
connection with any
such assumption, no material term of the Mortgage Note
(including but not
limited to the Mortgage Rate, the amount of the Monthly Payment
and any other
term affecting the amount or timing of payment on the Mortgage
Loan) may be
changed. The Master Servicer shall not enter into any
substitution or assumption
if such substitution or assumption would constitute a
"significant modification"
effecting an exchange or reissuance of such Mortgage Loan under
the Code (or
final, temporary or proposed Treasury regulations promulgated
thereunder) and
cause the Trust Fund to fail to qualify as a REMIC under the
Code or the
imposition of any tax on "prohibited transactions" or
"contributions" after the
Startup Day under the REMIC Provisions. The Master Servicer
shall notify the
Trustee that any such substitution or assumption agreement has
been completed by
forwarding to the Trustee the original copy of such substitution
or assumption
agreement, which copy shall be added to the related Mortgage
File and shall, for
all purposes, be considered a part of such Mortgage File to the
same extent as
all other documents and instruments constituting a part
thereof.
Notwithstanding the foregoing paragraph or any other
provision
of this Agreement, the Master Servicer shall not be deemed to be
in default,
breach or any other violation of its obligations hereunder by
reason of any
assumption of a Mortgage Loan by operation of law or any
assumption that the
Master Servicer may be restricted by law from preventing, for
any reason
whatsoever. For purposes of this Section 3.14, the term
"assumption" is deemed
to also include a sale of a Mortgaged Property that is not
accompanied by an
assumption or substitution of liability agreement.
SECTION 3.15. Realization Upon Defaulted Mortgage Loans.
The Master Servicer shall exercise reasonable efforts,
consistent with the procedures that the Master Servicer would
use in servicing
loans for its own account, to foreclose upon or otherwise
comparably convert
(which may include an REO Acquisition) the ownership of
properties securing such
of the Mortgage Loans as come into and continue in default and
as to which no
satisfactory arrangements can be made for collection of
delinquent payments
pursuant to Section 3.07, and which are not released from the
Trust Fund
pursuant to any other provision hereof. The Master Servicer
shall use reasonable
efforts to realize upon such defaulted Mortgage Loans in such
manner as will
maximize the receipt of principal and interest by
Certificateholders, taking
into account, among other things, the timing of foreclosure
proceedings. The
foregoing is subject to the provisions that, in any case in
which Mortgaged
Property shall have suffered damage from an Uninsured Cause, the
Master Servicer
shall not be required to expend its own funds toward the
restoration of such
property unless it shall determine in (i) that such restoration
will increase
the net proceeds of liquidation of the related Mortgage Loan
to
Certificateholders after reimbursement to itself for such
expenses, and (ii)
that such expenses will be recoverable by the Master Servicer
through Insurance
Proceeds or Liquidation Proceeds from the related Mortgaged
Property, as
contemplated in Section 3.11. The Master Servicer shall be
responsible for all
other costs and expenses incurred by it in any such proceedings;
provided,
however, that it shall be entitled to reimbursement thereof from
the related
Mortgaged Property, as contemplated in Section 3.11.
The proceeds of any Cash Liquidation or REO Disposition, as
well as any recovery resulting from a partial collection of
Insurance Proceeds
or Liquidation Proceeds or any income from an REO Property, will
be applied in
the following order of priority: first, to reimburse the Master
Servicer or any
Sub- Servicer for any related unreimbursed Servicing Advances,
pursuant to
Section 3.11 (vi) or 3.22; second, to accrued and unpaid
interest on the
Mortgage Loan or REO Imputed Interest, at the Mortgage Rate, to
the date of the
Cash Liquidation or REO Disposition, or to the Due Date prior to
the
Distribution Date on which such amounts are to be distributed if
not in
connection with a Cash Liquidation or REO Disposition; and
third, as a recovery
of principal of the Mortgage Loan. If the amount of the recovery
so allocated to
interest is less than a full recovery thereof, that amount will
be allocated as
follows: first, on a pro rata basis, to unpaid Servicing Fees;
and second, to
interest at the related Net Mortgage Rate. The portion of the
recovery so
allocated to unpaid Servicing Fees shall be reimbursed to the
Master Servicer or
any Sub-Servicer pursuant to Section 3.11(vi). The portions of
the recovery so
allocated to interest at the related Net Mortgage Rate and to
principal of the
Mortgage Loan shall be applied as follows: first, to reimburse
the Trustee for
any unpaid Trustee's Fees, second, to reimburse the Master
Servicer or any
Sub-Servicer for any related unreimbursed Advances in accordance
with Section 3.
1 31 (iii) or 3.22, and third, for distribution in accordance
with the
provisions of Section 4.01(b) and 4.01(c).
SECTION 3.16. Trustee to Cooperate; Release of Mortgage
Files.
Upon the payment in full of any Mortgage Loan, or the
receipt
by the Master Servicer of a notification that payment in full
shall be escrowed
in a manner customary for such purposes, the Master Servicer
will immediately
notify the Trustee by a certification (which certification shall
include a
statement to the effect that all amounts received or to be
received in
connection with such payment which are required to be deposited
in the Custodial
Account pursuant to Section 3.10 have been or will be so
deposited) of a
Servicing Officer and shall request delivery to it of the
Mortgage File in the
form of the Request for Release attached hereto as Exhibit F-2.
Upon receipt of
such certification and request, the Trustee shall promptly
release the related
Mortgage File to the Master Servicer. Subject to the receipt by
the Master
Servicer of the proceeds of such payment in full and the payment
of all related
fees and expenses, the Master Servicer shall arrange for the
release to the
Mortgagor of the original cancelled Mortgage Note. The Master
Servicer shall
provide for preparation of the appropriate instrument of
satisfaction covering
any Mortgage Loan which pays in full and the Trustee shall
cooperate in the
execution and return of such instrument to provide for its
delivery or recording
as may be required. All other documents in the Mortgage File
shall be retained
by the Master Servicer to the extent required by applicable law.
No expenses
incurred in connection with any instrument of satisfaction or
deed of
reconveyance shall be chargeable to the Custodial Account or the
Certificate
Account.
From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, including, for this purpose,
collection under
the Insurance Policies or any other insurance policy relating to
the Mortgage
Loan, the Trustee shall, upon request of the Master Servicer and
delivery to the
Trustee of a Request for Release in the form attached hereto as
Exhibit F-1,
release the related Mortgage File to the Master Servicer, and
the Trustee shall
execute such documents as the Master Servicer shall prepare and
request as being
necessary to the prosecution of any such proceedings. Such
Request for Release
shall obligate the Master Servicer to return each document
previously requested
from the Mortgage File to the Trustee when the need therefor by
the Master
Servicer no longer exists, unless the Mortgage Loan has been
liquidated and the
Liquidation Proceeds relating to the Mortgage Loan have been
deposited in the
Custodial Account or the Mortgage File or such document has been
delivered to an
attorney, or to a public trustee or other public official as
required by law,
for purposes of initiating or pursuing legal action or other
proceedings for the
foreclosure of the Mortgaged Property either judicially or
non-judicially, and
the Master Servicer has delivered to the Trustee a certificate
of a Servicing
Officer certifying as to the name and address of the Person to
which such
Mortgage File or such document was delivered and the purpose or
purposes of such
delivery. Upon receipt of a certificate of a Servicing Officer
stating that such
Mortgage Loan was liquidated and that all amounts received or to
be received in
connection with such liquidation which are required to be
deposited into the
Custodial Account have been or will be so deposited, or that
such Mortgage Loan
has become an REO Property, the servicing receipt shall be
released by the
Trustee to the Master Servicer.
Upon written request of a Servicing Officer, the Trustee
shall
execute and deliver to the Master Servicer any court pleadings,
requests for
trustee's sale or other documents prepared by the Master
Servicer that are
necessary to the foreclosure or trustee's sale in respect of a
Mortgaged
Property or to any legal action brought to obtain judgment
against any Mortgagor
on the Mortgage Note or Mortgage or to obtain a deficiency
judgment, or to
enforce any other remedies or rights provided by the Mortgage
Note or Mortgage
or otherwise available at law or in equity. Each such request
that such
pleadings or documents be executed by the Trustee shall include
a certification
as to the reason such documents or pleadings are required and
that the execution
and delivery thereof by the Trustee will not invalidate or
otherwise affect the
lien of the Mortgage, except for the termination of such a lien
upon completion
of the foreclosure or trustee's sale.
SECTION 3.17. Servicing Compensation.
As compensation for its activities hereunder, the Master
Servicer shall be entitled to retain, from deposits to the
Custodial Account of
amounts representing payments or recoveries of interest, the
Servicing Fees with
respect to each Mortg
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