EXHIBIT 4
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GS MORTGAGE SECURITIES CORP.,
Depositor,
LITTON LOAN SERVICING LP,
Servicer,
NEW CENTURY MORTGAGE CORPORATION,
Servicer,
NC CAPITAL CORPORATION,
Responsible Party,
and
DEUTSCHE BANK NATIONAL TRUST COMPANY,
Trustee
--------------------------------------------------------------------------------
POOLING AND SERVICING AGREEMENT
Dated as of February 1, 2005
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GSAMP TRUST 2005-NC1
MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2005-NC1
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<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
Section 1.01
Definitions..................................................
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
Section 2.01 Conveyance of Mortgage
Loans.................................
Section 2.02 Acceptance by the Trustee of the
Mortgage Loans..............
Section 2.03 Representations, Warranties and
Covenants of the
Responsible Party and the Servicer..........................
Section 2.04 Non-Qualified
Mortgages......................................
Section 2.05 Execution and Delivery of
Certificates.......................
Section 2.06 REMIC
Matters................................................
Section 2.07 Representations and Warranties of
the Depositor..............
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01 Servicer to Service Mortgage
Loans...........................
Section 3.02 Subservicing Agreements between
the Servicer and
Subservicers................................................
Section 3.03 Successor
Subservicers.......................................
Section 3.04 Liability of the
Servicer....................................
Section 3.05 No Contractual Relationship
between Subservicers and the
Trustee.....................................................
Section 3.06 Assumption or Termination of
Subservicing Agreements by
Trustee.....................................................
Section 3.07 Collection of Certain Mortgage
Loan Payments.................
Section 3.08 Subservicing
Accounts........................................
Section 3.09 Collection of Taxes, Assessments
and Similar Items;
Escrow Accounts.............................................
Section 3.10 Collection
Account...........................................
Section 3.11 Withdrawals from the Collection
Account......................
Section 3.12 Investment of Funds in the
Collection Account and the
Distribution Account........................................
Section 3.13 Maintenance of Hazard Insurance,
Errors and Omissions and
Fidelity Coverage...........................................
Section 3.14 Enforcement of Due-on-Sale
Clauses; Assumption Agreements....
Section 3.15 Realization upon Defaulted
Mortgage Loans....................
Section 3.16 Release of Mortgage
Files....................................
Section 3.17 Title, Conservation and
Disposition of REO Property..........
Section 3.18 Notification of
Adjustments..................................
Section 3.19 Access to Certain Documentation
and Information Regarding
the Mortgage Loans..........................................
Section 3.20 Documents, Records and Funds in
Possession of the
Servicer to Be Held for the Trustee.........................
Section 3.21 Servicing
Compensation.......................................
Section 3.22 Annual Statement as to
Compliance............................
Section 3.23 Annual Independent Public
Accountants' Servicing
Statement; Financial Statements.............................
Section 3.24 Trustee to Act as
Servicer...................................
Section 3.25 Compensating
Interest........................................
Section 3.26 Credit Reporting;
Gramm-Leach-Bliley Act.....................
Section 3.27 Excess Reserve Fund Account;
Distribution Account............
Section 3.28 Optional Purchase of Delinquent
Mortgage Loans...............
Section 3.29 Transfer of Servicing for the
Mortgage Loans.................
ARTICLE IV
DISTRIBUTIONS AND
ADVANCES BY THE SERVICER
Section 4.01
Advances.....................................................
Section 4.02 Priorities of
Distribution...................................
Section 4.03 Monthly Statements to
Certificateholders.....................
Section 4.04 Certain Matters Relating to the
Determination of LIBOR.......
Section 4.05 Allocation of Applied Realized
Loss Amounts..................
ARTICLE V
THE CERTIFICATES
Section 5.01 The
Certificates.............................................
Section 5.02 Certificate Register; Registration
of Transfer and
Exchange of Certificates....................................
Section 5.03 Mutilated, Destroyed, Lost or
Stolen Certificates............
Section 5.04 Persons Deemed
Owners........................................
Section 5.05 Access to List of
Certificateholders' Names and Addresses....
Section 5.06 Maintenance of Office or
Agency..............................
ARTICLE VI
THE DEPOSITOR AND THE SERVICER
Section 6.01 Respective Liabilities of the
Depositor and the Servicer.....
Section 6.02 Merger or Consolidation of the
Depositor or the Servicer.....
Section 6.03 Limitation on Liability of the
Depositor, the Servicer
and Others..................................................
Section 6.04 Limitation on Resignation of the
Servicer....................
Section 6.05 Additional Indemnification by the
Servicer; Third Party
Claims......................................................
Section 6.06 Servicing Rights
Pledge......................................
ARTICLE VII
DEFAULT
Section 7.01 Events of
Default............................................
Section 7.02 Trustee to Act; Appointment of
Successor.....................
Section 7.03 Notification to
Certificateholders...........................
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.01 Duties of the
Trustee........................................
Section 8.02 Certain Matters Affecting the
Trustee........................
Section 8.03 Trustee Not Liable for
Certificates or Mortgage Loans........
Section 8.04 Trustee May Own
Certificates.................................
Section 8.05 Trustee's Fees and
Expenses..................................
Section 8.06 Eligibility Requirements for the
Trustee.....................
Section 8.07 Resignation and Removal of the
Trustee.......................
Section 8.08 Successor
Trustee............................................
Section 8.09 Merger or Consolidation of the
Trustee.......................
Section 8.10 Appointment of Co-Trustee or
Separate Trustee................
Section 8.11 Tax
Matters..................................................
Section 8.12 Periodic
Filings.............................................
Section 8.13 Tax Classification of the Excess
Reserve Fund Account........
ARTICLE IX
TERMINATION
Section 9.01 Termination upon Liquidation or
Purchase of the Mortgage
Loans.......................................................
Section 9.02 Final Distribution on the
Certificates.......................
Section 9.03 Additional Termination
Requirements..........................
ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.01
Amendment....................................................
Section 10.02 Recordation of Agreement;
Counterparts.......................
Section 10.03 Governing
Law................................................
Section 10.04 Intention of
Parties.........................................
Section 10.05
Notices......................................................
Section 10.06 Severability of
Provisions...................................
Section 10.07 Assignment; Sales; Advance
Facilities........................
Section 10.08 Limitation on Rights of
Certificateholders...................
Section 10.09 Inspection and Audit
Rights..................................
Section 10.10 Certificates Nonassessable
and Fully Paid....................
Section 10.11 Waiver of Jury
Trial.........................................
SCHEDULES
Schedule I Mortgage Loan
Schedule
Schedule II Representations and
Warranties of Litton Loan Servicing LP
Schedule III Representations and Warranties of
New Century Mortgage
Corporation
Schedule IV Representations and
Warranties of the Responsible Party
as to the Individual
Mortgage Loans
Schedule V Representations and
Warranties of the Responsible Party
EXHIBITS
Exhibit A Form of Class A,
Class M and Class B Certificates
Exhibit B Form of Class N
Certificate
Exhibit C Form of Class R
Certificate
Exhibit D Form of Class X
Certificate
Exhibit E Form of Initial
Certification of Trustee
Exhibit F Form of Document
Certification and Exception Report of Trustee
Exhibit G Form of Residual
Transfer Affidavit
Exhibit H Form of
Transferor Certificate
Exhibit I Form of Rule
144A Letter
Exhibit J Form of
Investment Letter (Non-Rule 144A)
Exhibit K Form of Request
for Release
Exhibit L Form of Contents
for Each Mortgage File
Exhibit M Form of
Certification to be provided with Form 10-K
Exhibit N Form of Trustee
Certification to be provided to Depositor
Exhibit O Form of Servicer
Certification to be provided to Depositor
Exhibit P Form of Power of
Attorney
<PAGE>
THIS POOLING AND SERVICING AGREEMENT, dated as of February 1,
2005,
among GS MORTGAGE SECURITIES CORP., a
Delaware corporation (the "Depositor"),
LITTON LOAN SERVICING LP, a Delaware
limited partnership ("Litton"), NEW CENTURY
MORTGAGE CORPORATION, a California
corporation ("New Century"), NC CAPITAL
CORPORATION, a California corporation (the
"Responsible Party"), and DEUTSCHE
BANK NATIONAL TRUST COMPANY, a national
banking association (the "Trustee"),
W I T N E S S E T H:
In consideration of the mutual agreements herein contained, the
parties hereto agree as follows:
PRELIMINARY STATEMENT
The Trustee shall elect that six segregated asset pools within
the
Trust Fund be treated for federal income
tax purposes as comprising six REMICs
(each, a "Trust REMIC" or, in the
alternative, the Lower Tier REMIC, the Upper
Tier REMIC, the Class B-2 REMIC, the Class
B-3 REMIC, the Class B-4 REMIC and
the Class X REMIC, respectively). As
further described herein, the Class X/N
Regular Interest and each Class of LIBOR
Certificates (other than the right of
each Class of LIBOR Certificates to receive
Basis Risk Carry Forward Amounts)
represents ownership of a regular interest
in a REMIC for purposes of the REMIC
Provisions. The Class R-1 Certificate
represents ownership of the sole class of
residual interest in each of the Lower Tier
REMIC and the Upper Tier REMIC, and
the Class R-2 Certificate represents
ownership of the sole class of residual
interest in each of the Class B-2 REMIC,
the Class B-3 REMIC, the Class B-4
REMIC and the Class X REMIC for purposes of
the REMIC Provisions. The Start-up
Day for each REMIC described herein is the
Closing Date. The latest possible
maturity date for each Certificate is the
latest date referenced in Section
2.06. The Upper Tier REMIC shall hold as
assets the several classes of
uncertificated Lower Tier Regular
Interests, set out below. The Lower Tier REMIC
shall hold as assets the assets described
in the definition of "Trust Fund"
herein (other than the Excess Reserve Fund
Account). Each such Lower Tier
Regular Interest is hereby designated as a
regular interest in the Lower Tier
REMIC. The Class LT-A-1, Class LT-A-2,
Class LT-A-3, Class LT-M-1, Class LT-M-2,
Class LT-M-3, Class LT-B-1, Class LT-B-2,
Class LT-B-3 and Class LT-B-4
Interests are hereby designated the
LT-Accretion Directed Classes (the
"LT-Accretion Directed Classes").
The Class B-2 REMIC shall hold as an asset the Class B-2
Interest
issued by the Upper Tier REMIC, the Class
B-2 Certificates shall represent
ownership of the regular interest issued by
the Class B-2 REMIC and the Class
B2-R Interest shall represent the sole
class residual interest in the Class B-2
REMIC.
The Class B-3 REMIC shall hold as an asset the Class B-3
Interest
issued by the Upper Tier REMIC, the Class
B-3 Certificates shall represent
ownership of the regular interest issued by
the Class B-3 REMIC and the Class
B3-R Interest shall represent the sole
class residual interest in the Class B-3
REMIC.
The Class B-4 REMIC shall hold as an asset the Class B-4
Interest
issued by the Upper Tier REMIC, the Class
B-4 Certificates shall represent
ownership of the regular interest issued by
the Class B-4 REMIC and the Class
B4-R Interest shall represent the sole
class residual interest in the Class B-4
REMIC.
The Class X REMIC shall hold as an asset the Class X Interest
issued
by the Upper Tier REMIC, the Class X/N
Regular Interest shall represent the
regular interest issued by the Class X
REMIC and the Class X-R Interest shall
represent the sole class residual interest
in the Class X REMIC. The Class N and
Class X Certificates represent beneficial
ownership of the Class X/N Regular
Interest and the Excess Reserve Fund
Account. If the Class N and Class X
Certificates are beneficially owned by more
than one person, and such Persons do
not hold both the Class N and Class X
Certificates proportionately, then each
such Person will be treated as owning an
interest in a partnership that holds
the Class X/N Regular Interest and the
Excess Reserve Fund Account for federal
income tax purposes as described in Section
8.11.
Each LIBOR Certificate represents a beneficial ownership of a
regular interest in a Trust REMIC and the
right to receive Basis Risk Carry
Forward Amounts, which portion of the Trust
Fund shall be treated as a grantor
trust.
Corresponding
Upper Tier
Lower Tier Regular Lower Tier
Initial Lower
Tier Principal
REMIC Regular
Interest
Interest Rate
Amount
Interest
------------------ -------------
------
--------
Class LT-A-1
(1) 1/2
initial Class Certificate
A-1
Balance of Corresponding
Upper Tier REMIC Regular
Interest
Class LT-A-2
(1) 1/2
initial Class Certificate
A-2
Balance of Corresponding
Upper Tier REMIC Regular
Interest
Class LT-A-3
(1) 1/2
initial Class Certificate
A-3
Balance of Corresponding
Upper Tier REMIC Regular
Interest
Class LT-M-1
(1) 1/2
initial Class Certificate
M-1
Balance of Corresponding
Upper Tier REMIC Regular
Interest
Class LT-M-2
(1) 1/2
initial Class Certificate
M-2
Balance of Corresponding
Upper Tier REMIC Regular
Interest
Class LT-M-3
(1) 1/2
initial Class Certificate
M-3
Balance of Corresponding
Upper Tier REMIC Regular
Interest
Class LT-B-1
(1) 1/2
initial Class Certificate
B-1
Balance of Corresponding
Upper Tier REMIC Regular
Interest
Class LT-B-2
(1) 1/2
initial Class Certificate
B-2
Balance of Corresponding
Upper Tier REMIC Regular
Interest
Class LT-B-3
(1) 1/2
initial Class Certificate
B-3
Balance of Corresponding
Upper Tier REMIC Regular
Interest
Class LT-B-4
(1) 1/2
initial Class Certificate
B-4
Balance of Corresponding
Upper Tier REMIC Regular
Interest
Class LT-Accrual
(1) 1/2
Pool Stated Principal
Balance plus 1/2
Overcollateralized Amount
Class LT-R
(2)
(2)
------------
(1) The interest rate with
respect to any Distribution Date for these
interests
is a per annum variable rate equal to the WAC Cap.
(2) The Class LT-R Interest is
the sole Class of residual interest in the
Lower Tier
REMIC and it does not have a principal amount or an interest
rate.
The Lower Tier REMIC shall hold as assets all of the assets
included
in definition of "Trust Fund" other than
the Excess Reserve Fund Account.
On each Distribution Date, 50% of the increase in the
Overcollateralized Amount will be payable
as a reduction of the Lower-Tier
Principal Amounts of the LT-Accretion
Directed Classes (each such Class will be
reduced by an amount equal to 50% of any
increase in the Overcollateralized
Amount that is attributable to a reduction
in the Class Certificate Balance of
its Corresponding Class) and will be
accrued and added to the Lower-Tier
Principal Amounts of the Class LT-Accrual
Interest. On each Distribution Date,
the increase in the Lower-Tier Principal
Amounts of the Class LT-Accrual
Interest may not exceed interest accruals
for such Distribution Date for the
Class LT-Accrual Interest. In the event
that: (i) 50% of the increase in the
Overcollateralized Amount exceeds (ii)
interest accruals on the Class LT-Accrual
Interest for such Distribution Date, the
excess for such Distribution Date
(accumulated with all such excesses for all
prior Distribution Dates) will be
added to any increase in the
Overcollateralized Amount for purposes of
determining the amount of interest accrual
on the Class LT-Accrual Interest
payable as principal on the LT-Accretion
Directed Classes on the next
Distribution Date pursuant to the first
sentence of this paragraph. All payments
of scheduled principal and prepayments of
principal generated by the Mortgage
Loans shall be allocated (i) 50% to the
Class LT-Accrual Interest, and (ii) 50%
to the LT-Accretion Directed Classes
(principal payments shall be allocated
among such LT-Accretion Directed Classes in
an amount equal to 50% of the
principal amounts allocated to their
respective Corresponding Classes), until
paid in full. Notwithstanding the above,
principal payments allocated to the
Class X Interest that result in the
reduction in the Overcollateralized Amount
shall be allocated to the Class LT-Accrual
Interest (until paid in full).
Realized Losses shall be applied so that
after all distributions have been made
on each Distribution Date (i) the principal
balance of each of the LT-Accretion
Directed Classes is equal to 50% of the
Lower Tier Principal Amount of their
Corresponding Class of Upper Tier Regular
Interest, and (ii) the Class
LT-Accrual Interest is equal to 50% of the
aggregate Stated Principal Balance of
the Mortgage Loans plus 50% of the
Overcollateralized Amount. Prepayment
Premiums shall be paid to the Upper Tier
REMIC by distributing such amounts to
the Class LT-Accrual Interest (but not in
reduction of its Lower Tier Principal
Amount).
The Upper Tier REMIC shall issue the following classes of Upper
Tier
Regular Interests, and each such interest,
other than the Class UT-R Interest,
is hereby designated as a regular interest
in the Upper Tier REMIC.
Upper Tier
Interest Rate
Initial Upper Tier
and
Principal Amount
Corresponding and Corresponding
Corresponding
Upper Tier
Class
Class Certificate Class
of
Class Designation Pass-Through Rate
Balance
Certificates
----------------- -----------------
-------
------------
Class A-1
(1)
$189,636,000 Class
A-1(7)
Class A-2
(2)
$129,754,000 Class
A-2(7)
Class A-3
(3)
$49,572,000
Class A-3(7)
Class M-1
(4)
$45,170,000
Class M-1(7)
Class M-2
(4)
$23,298,000
Class M-2(7)
Class M-3
(4)
$ 4,754,000
Class M-3(7)
Class B-1
(4)
$ 4,755,000
Class B-1(7)
Class B-2
(4)
$ 4,755,000
Class B-2(7)
Class B-3
(4)
$ 4,754,000
Class B-3(7)
Class B-4
(4)
$ 4,750,000
Class B-4(7)
Class X
(5)
0(5) Class
X(5)
Class UT-R
(6)
0
Class R
------------
(1) The Class A-1 Interest will
bear interest during each Interest Accrual
Period at
a per annum rate equal to (a) on or prior to the Optional
Termination Date, the lesser of (i) LIBOR plus 0.120% and (ii) the
WAC Cap
or (b)
after the Optional Termination Date, the lesser of (i) LIBOR
plus
0.240% and
(ii) the WAC Cap.
(2) The Class A-2 Interest will
bear interest during each Interest Accrual
Period at
a per annum rate equal to (a) on or prior to the Optional
Termination Date, the lesser of (i) LIBOR plus 0.210% and (ii) the
WAC Cap
or (b)
after the Optional Termination Date, the lesser of (i) LIBOR
plus
0.420% and
(ii) the WAC Cap.
(3) The Class A-3 Interest will
bear interest during each Interest Accrual
Period at
a per annum rate equal to (a) on or prior to the Optional
Termination Date, the lesser of (i) LIBOR plus 0.380% and (ii) the
WAC Cap
or (b)
after the Optional Termination Date, the lesser of (i) LIBOR
plus
0.760% and
(ii) the WAC Cap.
(4) The Class M-1, Class M-2,
Class M-3, Class B-1, Class B-2, Class B-3 and
Class B-4
Interests will bear interest during each Interest Accrual
Period
at a per
annum rate equal to (a) on or prior to the Optional Termination
Date, the
least of (i) LIBOR plus 0.450%, 0.730%, 0.800%, 1.250%, 1.300%,
1.400% and
2.300% respectively and (ii) the WAC Cap or (b) after the
Optional
Termination Date, the lesser of (i) LIBOR plus 0.675%, 1.095%,
1.200%,
1.875%, 1.950%, 2.100% and 3.450% respectively and (ii) the WAC
Cap.
(5) The Class X Interest has an
initial principal balance of $14,269,440.71,
but it
will not accrue interest on such balance but will accrue
interest
on a
notional principal balance. As of any Distribution Date, the Class
X
Interest
shall have a notional principal balance equal to the aggregate
of
the
principal balances of the Lower Tier Regular Interests as of the
first
day of the
related Interest Accrual Period. With respect to any Interest
Accrual
Period, the Class X Interest shall bear interest at a rate
equal
to the
excess, if any, of the WAC Cap over the product of (i) 2 and
(ii)
the
weighted average Pass-Through Rate of the Lower Tier REMIC
Interests,
where the
Lower-Tier Interest Rate on the Class LT-Accrual Interest is
subject to
a cap equal to zero and on each LT-Accretion Directed Class is
subject to
a cap equal to the Pass-Through Rate on its Corresponding
Class.
With respect to any Distribution Date, interest that so accrues
on
the
notional principal balance of the Class X Interest shall be
deferred
in an
amount equal to any increase in the Overcollateralized Amount
on
such
Distribution Date. Such deferred interest shall not itself bear
interest.
In addition, the Class X Interest shall be entitled to receive
all
Prepayment Premiums.
(6) The Class UT-R Interest is
the sole class of residual interest in the
Upper Tier
REMIC. The Class UT-R Interest does not have an interest rate.
(7) The Class A-1, Class A-2,
Class A-3, Class M-1 and Class M-2 Certificates
will
represent not only the ownership of the Corresponding Class of
Upper
Tier
Regular Interest but also the right to receive payments from
the
Excess
Reserve Fund Account in respect of any Basis Risk Carry Forward
Amounts.
Each of the Class B-2 Interest, Class B-3 Interest, Class B-4
Interest,
and Class X Interest will be contributed to the Class B-2
REMIC,
the Class
B-3 REMIC, the Class B-4 REMIC and the Class X REMIC,
respectively.
The Class B-2 REMIC shall issue the following classes of
interests.
The Class B-2 Certificates shall represent
the regular interest in the Class B-2
REMIC and the Class B2-R Interest shall
represent the sole class of residual
interest in the Class B-2 REMIC.
Class B-2 REMIC
Class B-2 REMIC Principal
Designation
Interest Rate
Amount
-----------
-------------
------
Class B-2 REMIC
(1)
(1)
Regular Interest
Class B2-R
(2)
(2)
------------
(1) The Class B-2 REMIC shall
issue one regular interest which shall be
represented by the Class B-2 Certificates and shall be entitled to
100% of
all
amounts payable on the Class B-2 Interest issued by the
Upper-Tier
REMIC.
(2) The Class B2-R Interest is
the sole class of residual interest in the
Class B-2
REMIC and shall be represented by the Class R-2 Certificate.
The
Class B2-R
Interest does not have an interest rate or a principal balance.
The Class B-3 REMIC shall issue the following classes of
interests.
The Class B-3 Certificates shall represent
the regular interest in the Class B-3
REMIC and the Class B3-R Interest shall
represent the sole class of residual
interest in the Class B-3 REMIC.
Class B-3 REMIC
Class B-3 REMIC Principal
Designation
Interest Rate
Amount
-----------
-------------
------
Class B-3 REMIC
(1)
(1)
Regular Interest
Class B3-R
(2)
(2)
------------
(1) The Class B-3 REMIC shall
issue one regular interest which shall be
represented by the Class B-3 Certificates and shall be entitled to
100% of
all
amounts payable on the Class B-3 Interest issued by the
Upper-Tier
REMIC.
(2) The Class B3-R Interest is the
sole class of residual interest in the
Class B-3
REMIC and shall be represented by the Class R-2 Certificate.
The
Class B3-R
Interest does not have an interest rate or a principal balance.
The Class B-4 REMIC shall issue the following classes of
interests.
The Class B-4 Certificates shall represent
the regular interest in the Class B-4
REMIC and the Class B4-R Interest shall
represent the sole class of residual
interest in the Class B-4 REMIC.
Class B-4 REMIC
Class B-4 REMIC Principal
Designation
Interest Rate
Amount
-----------
-------------
------
Class B-4 REMIC
(1)
(1)
Regular Interest
Class B4-R
(2)
(2)
------------
(1) The Class B-4 REMIC shall
issue one regular interest which shall be
represented by the Class B-4 Certificates and shall be entitled to
100% of
all
amounts payable on the Class B-4 Interest issued by the
Upper-Tier
REMIC.
(2) The Class B4-R Interest is
the sole class of residual interest in the
Class B-4
REMIC and shall be represented by the Class R-2 Certificate.
The
Class B4-R
Interest does not have an interest rate or a principal balance.
The Class X REMIC shall issue the following classes of
interests.
The Class X/N Regular Interest shall
represent the regular interest in the Class
X REMIC and the Class X-R Interest shall
represent the sole class of residual
interest in the Class X REMIC.
Class X REMIC
Class X REMIC Principal
Designation
Interest Rate
Amount
-----------
-------------
------
Class X/N Regular
(1)
(1)
Interest
Class X-R
(2)
(2)
------------
(1) The Class X REMIC shall
issue one regular interest which shall be
represented by the Class N and X Certificates and shall be entitled
to (i)
100% of
all amounts payable on the Class X Interest issued by the
Upper-Tier
REMIC and (ii) all Prepayment Premiums.
(2) The Class X-R Interest is
the sole class of residual interest in the Class
X REMIC
and shall be represented by the Class R-2 Certificate. The
Class
X-R
Interest does not have an interest rate or a principal balance.
The Class B-2, Class B-3 and Class B-4 Certificates will
represent
not only the ownership of the regular
interest issued by the Class B-2 REMIC,
the Class B-3 REMIC and the Class B-4
REMIC, respectively, but also the right to
receive payments from the Excess Reserve
Fund Account in respect of any Basis
Risk Carry Forward Amounts. The Class X and
Class N Certificates will represent
ownership of the Class X/N Regular
Interest, each of which shall be treated as
an interest in a partnership if held by
more than one Person for federal income
tax purposes, and such Persons do not hold
both the Class N and Class X
Certificates proportionately. For federal
income tax purposes, the Trustee will
treat a LIBOR Certificateholder's right to
receive payments from the Excess
Reserve Fund Account as payments made
pursuant to an interest rate cap contract
written by the Class N and Class X
Certificateholders. Such rights of the LIBOR
Certificateholders shall be treated as held
in a portion of the Trust Fund that
is treated as a grantor trust under subpart
E, Part I of subchapter J of the
Code.
The minimum denomination for each Class of the Class A
Certificates
will be $25,000, with integral multiples of
$1 in excess thereof except that one
Certificate in each Class may be issued in
a different amount. The minimum
denomination for each Class of the
Subordinated Certificates, will be $250,000
with integral multiples of $1 in excess
thereof except that one Certificate in
each Class may be issued in a different
amount. The minimum denomination for the
Class N Certificate will be $50,000 initial
Class N Notional Amount with
integral multiples of $1,000 in excess
thereof. The minimum denomination for (a)
each of the Class R-1 and Class R-2
Certificates will be a 100% Percentage
Interest in such Class and (b) the Class X
Certificates will be a 1% Percentage
Interest in such Class.
Set forth below are designations of Classes of Certificates to
the
categories used herein:
Book-Entry Certificates...... All Classes of Certificates
other than the
Physical Certificates.
Class A Certificates......... Class A-1, Class A-2 and
Class A-3 Certificates.
Delay Certificates........... None.
ERISA-Restricted
Certificates...............
Class R
Certificates, Class N Certificates and
Class X Certificates; any certificate with a
rating below the lowest applicable permitted
rating under the Underwriters' Exemption.
LIBOR Certificates........... The Class A Certificates and
the Subordinated
Certificates.
Non-Delay Certificates....... Class A, Class X and
Subordinated Certificates.
Offered Certificates......... All Classes of Certificates
other than the
Private Certificates.
Physical Certificates........ Class N, Class X and Class R
Certificates.
Private Certificates......... Class B-2, Class B-3, Class
B-4, Class N, Class
X and Class R Certificates.
Rating Agencies.............. Moody's and Standard &
Poor's.
Regular Certificates......... All Classes of Certificates
other than the Class
R Certificates.
Residual Certificates........ Class R-1 and Class R-2
Certificates.
Subordinated Certificates.... Class M-1, Class M-2, Class
M-3, Class B-1,
Class B-2, Class B-3 and Class B-4 Certificates.
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. Whenever used in this Agreement, the
following words and phrases, unless the
context otherwise requires, shall have
the following meanings:
Accepted Servicing Practices: With respect to any Mortgage
Loan,
those mortgage servicing practices set
forth in Section 3.01(a) of this
Agreement.
Account: Any of the
Collection Account, the Distribution Account,
any Escrow Account or the Excess Reserve
Fund Account. Each Account shall be an
Eligible Account.
Accrued Certificate Interest Distribution Amount: With respect
to
any Distribution Date for each Class of the
LIBOR Certificates or the Class N
Certificates, the amount of interest
accrued during the related Interest Accrual
Period at the applicable Pass-Through Rate
on the related Class Certificate
Balance or Class N Notional Amount, as
applicable, immediately prior to such
Distribution Date, as reduced by such
Class's share of Net Prepayment Interest
Shortfalls and Relief Act Interest
Shortfalls for such Distribution Date
allocated to such Class pursuant to Section
4.02.
Adjustable
Rate Mortgage Loan: An adjustable rate Mortgage Loan.
Adjusted Net Mortgage Interest Rate: As to each Mortgage Loan and
at
any time, the per annum rate equal to the
Mortgage Interest Rate less the
Expense Fee Rate.
Adjustment Date: As to any Mortgage Loan, the first Due Date on
which the related Mortgage Interest Rate
adjusts as set forth in the related
Mortgage Note and each Due Date thereafter
on which the Mortgage Interest Rate
adjusts as set forth in the related
Mortgage Note.
Advance: Any P&I Advance or Servicing Advance.
Advance Facility: A financing or other facility as described in
Section 10.07.
Advance Facility Notice: As defined in Section 10.07.
Advance Financing Person: The Person to whom the Servicer's
rights
under this Agreement to be reimbursed for
any P&I Advances or Servicing Advances
have been assigned pursuant to Section
10.07.
Advance Reimbursement Amounts: As defined in Section 10.07.
Affiliate: With respect to any Person, any other Person
controlling,
controlled by or under common control with
such first Person. For the purposes
of this definition, "control" means the
power to direct the management and
policies of such Person, directly or
indirectly, whether through the ownership
of voting securities, by contract or
otherwise; and the terms "controlling" and
"controlled" have meanings correlative to
the foregoing.
Agreement: This Pooling and Servicing Agreement and all
amendments
or supplements hereto.
Amount Held for Future Distribution: As to the Certificates on
any
Distribution Date, the aggregate amount
held in the Collection Account at the
close of business on the related Remittance
Date on account of (i) Principal
Prepayments, Insurance Proceeds,
Condemnation Proceeds and Liquidation Proceeds
on the Mortgage Loans received after the
end of the related Prepayment Period
and (ii) all Scheduled Payments on the
Mortgage Loans due after the end of the
related Due Period.
Applied Realized Loss Amount: With respect to any Distribution
Date,
the amount, if any, by which the aggregate
Class Certificate Balance of the
LIBOR Certificates after distributions of
principal on such Distribution Date
exceeds the aggregate Stated Principal
Balance of the Mortgage Loans for such
Distribution Date.
Appraised Value: (i) With respect to any First Lien Mortgage
Loan,
the value of the related Mortgaged Property
based upon the appraisal made for
the originator at the time of origination
of the Mortgage Loan or the sales
price of the Mortgaged Property at such
time of origination, whichever is less,
and (ii) with respect to any Second Lien
Mortgage Loan, the value, determined
pursuant to the Underwriting Guidelines, of
the related Mortgaged Property as of
the origination of the Second Lien Mortgage
Loan; provided, however, that in the
case of a refinanced Mortgage Loan, such
value is based solely upon the
appraisal made at the time of origination
of such refinanced Mortgage Loan.
Assignment of Mortgage: An assignment of the Mortgage, notice
of
transfer or equivalent instrument in
recordable form (other than the assignee's
name and recording information not yet
returned from the recording office),
reflecting the sale of the Mortgage to the
Trustee.
Available Funds: With respect to any Distribution Date and the
Mortgage Loans to the extent received by
the Trustee (x) the sum of (i) all
scheduled installments of interest (net of
the related Expense Fees) and
principal due on the Due Date on such
Mortgage Loans in the related Due Period
and received on or prior to the related
Determination Date, together with any
P&I Advances in respect thereof; (ii)
all Condemnation Proceeds, Insurance
Proceeds and Liquidation Proceeds received
during the related Prepayment Period
(in each case, net of unreimbursed expenses
incurred in connection with a
liquidation or foreclosure and unreimbursed
Advances, if any); (iii) all partial
or full prepayments on the Mortgage Loans
received during the related Prepayment
Period together with all Compensating
Interest paid by the Servicer in
connection therewith (excluding Prepayment
Premiums); (iv) amounts received with
respect to such Distribution Date as the
Substitution Adjustment Amount or
purchase price in respect of a Deleted
Mortgage Loan or a Mortgage Loan
repurchased by the Responsible Party or the
Depositor as of such Distribution
Date; and (v) the proceeds received with
respect to the termination of the Trust
Fund pursuant to clause (a) of Section
9.01, reduced by (y) amounts in
reimbursement for P&I Advances and
Servicing Advances previously made with
respect to the Mortgage Loans and other
amounts as to which the Servicer, the
Depositor or the Trustee (or co-trustee)
are entitled to be paid or reimbursed
pursuant to this Agreement.
Basic Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
Principal Remittance Amount for such
Distribution Date over (ii) the Excess
Overcollateralized Amount, if any, for
such Distribution Date.
Basis Risk Carry Forward Amount: With respect to each Class of
LIBOR
Certificates, as of any Distribution Date,
the sum of (A) if on such
Distribution Date the Pass-Through Rate for
any Class of LIBOR Certificates is
based upon the WAC Cap, the excess, if any,
of (i) the amount of interest such
Class of Certificates would otherwise be
entitled to receive on such
Distribution Date had such Pass-Through
Rate not been subject to the WAC Cap,
over (ii) the amount of interest payable on
such Class of Certificates on such
Distribution Date taking into account the
WAC Cap and (B) the Basis Risk Carry
Forward Amount for such Class of
Certificates for all previous Distribution
Dates not previously paid, together with
interest thereon at a rate equal to the
applicable Pass-Through Rate for such Class
of Certificates for such
Distribution Date (without giving effect to
the WAC Cap).
Basis Risk Payment: For any Distribution Date, an amount equal
to
the lesser of (i) the aggregate of the
Basis Risk Carry Forward Amounts for such
Distribution Date and (ii) the Class X
Distributable Amount (prior to any
reduction for Basis Risk Payments).
Best's: Best's Key Rating Guide, as the same shall be amended
from
time to time.
Book-Entry Certificates: As specified in the Preliminary
Statement.
Business Day: Any day other than (i) Saturday or Sunday, or (ii)
a
day on which banking and savings and loan
institutions, in (a) the States of New
York, California, Texas and Illinois, (b)
the State in which the Servicer's
servicing operations are located, or (c)
the State in which the Trustee's
operations are located, are authorized or
obligated by law or executive order to
be closed.
Certificate: Any one of the Certificates executed by the Trustee
in
substantially the forms attached hereto as
exhibits.
Certificate Balance: With respect to any Class of LIBOR
Certificates, at any date, the maximum
dollar amount of principal to which the
Holder thereof is then entitled hereunder,
such amount being equal to the
Denomination thereof minus all
distributions of principal previously made with
respect thereto and in the case of any
Subordinated Certificates, reduced by any
Applied Realized Loss Amounts applicable to
such Class of Certificates;
provided, however, that immediately
following the Distribution Date on which a
Subsequent Recovery is distributed, the
Class Certificate Balances of any Class
or Classes of Certificates that have been
previously reduced by Applied Realized
Loss Amounts will be increased, in order of
seniority, by the amount of the
Subsequent Recovery distributed on such
Distribution Date (up to the amount of
Applied Realized Loss Amounts allocated to
such Class or Classes). The Class N,
Class X and Class R Certificates have no
Certificate Balance.
Certificate Owner: With respect to a Book-Entry Certificate,
the
Person who is the beneficial owner of such
Book-Entry Certificate.
Certificate Register: The register maintained pursuant to
Section
5.02.
Certificateholder or Holder: The person in whose name a
Certificate
is registered in the Certificate Register,
except that, solely for the purpose
of giving any consent pursuant to this
Agreement, any Certificate registered in
the name of the Depositor or any affiliate
of the Depositor shall be deemed not
to be Outstanding and the Percentage
Interest evidenced thereby shall not be
taken into account in determining whether
the requisite amount of Percentage
Interests necessary to effect such consent
has been obtained; provided, however,
that if any such Person (including the
Depositor) owns 100% of the Percentage
Interests evidenced by a Class of
Certificates, such Certificates shall be
deemed to be Outstanding for purposes of
any provision hereof that requires the
consent of the Holders of Certificates of a
particular Class as a condition to
the taking of any action hereunder. The
Trustee is entitled to rely conclusively
on a certification of the Depositor or any
affiliate of the Depositor in
determining which Certificates are
registered in the name of an affiliate of the
Depositor.
Certification: As defined in Section 8.12(b).
Class: All Certificates bearing the same class designation as
set
forth in the Preliminary Statement.
Class A Certificates: As specified in the Preliminary
Statement.
Class A Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
aggregate Class Certificate Balances of
the Class A Certificates immediately prior
to such Distribution Date over (ii)
the lesser of (A) 55.20% of the aggregate
Stated Principal Balance of the
Mortgage Loans for such Distribution Date
and (B) the excess, if any, of the
aggregate Stated Principal Balance of the
Mortgage Loans for such Distribution
Date over the Overcollateralization
Floor.
Class A-1 Certificates: All Certificates bearing the class
designation of "Class A-1."
Class A-2 Certificates: All Certificates bearing the class
designation of "Class A-2."
Class A-3 Certificates: All Certificates bearing the class
designation of "Class A-3."
Class B-1 Certificates: All Certificates bearing the class
designation of "Class B-1."
Class B-1 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
sum of (A) the aggregate Class
Certificate Balances of the Class A
Certificates (after taking into account the
distribution of the Class A Principal
Distribution Amount on such Distribution
Date), (B) the Class Certificate Balance of
the Class M-1 Certificates (after
taking into account the distribution of the
Class M-1 Principal Distribution
Amount on such Distribution Date), (C) the
Class Certificate Balance of the
Class M-2 Certificates (after taking into
account the distribution of the Class
M-2 Principal Distribution Amount on such
Distribution Date), (D) the Class
Certificate Balance of the Class M-3
Certificates (after taking into account the
distribution of the Class M-3 Principal
Distribution Amount on such Distribution
Date), and (E) the Class Certificate
Balance of the Class B-1 Certificates
immediately prior to such Distribution Date
over (ii) the lesser of (A) 88.00%
of the aggregate Stated Principal Balance
of the Mortgage Loans for such
Distribution Date and (B) the excess, if
any, of the aggregate Stated Principal
Balance of the Mortgage Loans for such
Distribution Date over the
Overcollateralization Floor.
Class B-2 Certificates: All Certificates bearing the class
designation of "Class B-2."
Class B-2 Interest: The Upper Tier Regular Interest held by the
Class B-2 REMIC as specified and described
in the Preliminary Statement and the
related footnote thereto.
Class B-2 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
sum of (A) the aggregate Class
Certificate Balances of the Class A
Certificates (after taking into account the
distribution of the Class A Principal
Distribution Amount on such Distribution
Date), (B) the Class Certificate Balance of
the Class M-1 Certificates (after
taking into account the distribution of the
Class M-1 Principal Distribution
Amount on such Distribution Date), (C) the
Class Certificate Balance of the
Class M-2 Certificates (after taking into
account the distribution of the Class
M-2 Principal Distribution Amount on such
Distribution Date), (D) the Class
Certificate Balance of the Class M-3
Certificates (after taking into account the
distribution of the Class M-3 Principal
Distribution Amount on such Distribution
Date), (E) the Class Certificate Balance of
the Class B-1 Certificates (after
taking into account the distribution of the
Class B-1 Principal Distribution
Amount on such Distribution Date), and (F)
the Class Certificate Balance of the
Class B-2 Certificates immediately prior to
such Distribution Date over (ii) the
lesser of (A) 90.00% of the aggregate
Stated Principal Balance of the Mortgage
Loans for such Distribution Date and (B)
the excess, if any, of the aggregate
Stated Principal Balance of the Mortgage
Loans for such Distribution Date over
the Overcollateralization Floor.
Class B2-R Interest: The residual interest in the Class B-2 REMIC
as
described in the Preliminary Statement and
the related footnote thereto.
Class B-2 REMIC: As described in the Preliminary Statement.
Class B-3 Certificates: All Certificates bearing the class
designation of "Class B-3."
Class B-3 Interest: The Upper Tier Regular Interest held by the
Class B-3 REMIC as specified and described
in the Preliminary Statement and the
related footnote thereto.
Class B-3 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
sum of (A) the aggregate Class
Certificate Balances of the Class A
Certificates (after taking into account the
distribution of the Class A Principal
Distribution Amount on such Distribution
Date), (B) the Class Certificate Balance of
the Class M-1 Certificates (after
taking into account the distribution of the
Class M-1 Principal Distribution
Amount on such Distribution Date), (C) the
Class Certificate Balance of the
Class M-2 Certificates (after taking into
account the distribution of the Class
M-2 Principal Distribution Amount on such
Distribution Date), (D) the Class
Certificate Balance of the Class M-3
Certificates (after taking into account the
distribution of the Class M-3 Principal
Distribution Amount on such Distribution
Date), (E) the Class Certificate Balance of
the Class B-1 Certificates (after
taking into account the distribution of the
Class B-1 Principal Distribution
Amount on such Distribution Date), (F) the
Class Certificate Balance of the
Class B-2 Certificates (after taking into
account the distribution of the Class
B-2 Principal Distribution Amount on such
Distribution Date), and (G) the Class
Certificate Balance of the Class B-3
Certificates immediately prior to such
Distribution Date over (ii) the lesser of
(A) 92.00% of the aggregate Stated
Principal Balance of the Mortgage Loans for
such Distribution Date and (B) the
excess, if any, of the aggregate Stated
Principal Balance of the Mortgage Loans
for such Distribution Date over the
Overcollateralization Floor.
Class B3-R Interest: The residual interest in the Class B-3 REMIC
as
described in the Preliminary Statement and
the related footnote thereto.
Class B-3 REMIC: As described in the Preliminary Statement.
Class B-4 Certificates: All Certificates bearing the class
designation of "Class B-4."
Class B-4 Interest: The Upper Tier Regular Interest held by the
Class B-4 REMIC as specified and described
in the Preliminary Statement and the
related footnote thereto.
Class B-4 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
sum of (A) the aggregate Class
Certificate Balances of the Class A
Certificates (after taking into account the
distribution of the Class A Principal
Distribution Amount on such Distribution
Date), (B) the Class Certificate Balance of
the Class M-1 Certificates (after
taking into account the distribution of the
Class M-1 Principal Distribution
Amount on such Distribution Date), (C) the
Class Certificate Balance of the
Class M-2 Certificates (after taking into
account the distribution of the Class
M-2 Principal Distribution Amount on such
Distribution Date), (D) the Class
Certificate Balance of the Class M-3
Certificates (after taking into account the
distribution of the Class M-3 Principal
Distribution Amount on such Distribution
Date), (E) the Class Certificate Balance of
the Class B-1 Certificates (after
taking into account the distribution of the
Class B-1 Principal Distribution
Amount on such Distribution Date), (F) the
Class Certificate Balance of the
Class B-2 Certificates (after taking into
account the distribution of the Class
B-2 Principal Distribution Amount on such
Distribution Date), (G) the Class
Certificate Balance of the Class B-3
Certificates (after taking into account the
distribution of the Class B-3 Principal
Distribution Amount on such Distribution
Date), and (H) the Class Certificate
Balance of the Class B-4 Certificates
immediately prior to such Distribution Date
over (ii) the lesser of (A) 94.00%
of the aggregate Stated Principal Balance
of the Mortgage Loans for such
Distribution Date and (B) the excess, if
any, of the aggregate Stated Principal
Balance of the Mortgage Loans for such
Distribution Date over the
Overcollateralization Floor.
Class B4-R Interest: The residual interest in the Class B-4 REMIC
as
described in the Preliminary Statement and
the related footnote thereto.
Class B-4 REMIC: As described in the Preliminary Statement.
Class Certificate Balance: With respect to any Class and as to
any
date of determination, the aggregate of the
Certificate Balances of all
Certificates of such Class as of such
date.
Class LT-R Interest: The residual interest in the Lower Tier
REMIC
as described in the Preliminary Statement
and the related footnote thereto.
Class M-1 Certificates: All Certificates bearing the class
designation of "Class M-1."
Class M-1 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
sum of (A) the aggregate Class
Certificate Balances of the Class A
Certificates (after taking into account the
distribution of the Class A Principal
Distribution Amount on such Distribution
Date), and (B) the Class Certificate
Balance of the Class M-1 Certificates
immediately prior to such Distribution Date
over (ii) the lesser of (A) 74.20%
of the aggregate Stated Principal Balance
of the Mortgage Loans for such
Distribution Date and (B) the excess, if
any, of the aggregate Stated Principal
Balance of the Mortgage Loans for such
Distribution Date over the
Overcollateralization Floor.
Class M-2 Certificates: All Certificates bearing the class
designation of "Class M-2."
Class M-2 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
sum of (A) the aggregate Class
Certificate Balances of the Class A
Certificates (after taking into account the
distribution of the Class A Principal
Distribution Amount on such Distribution
Date), (B) the Class Certificate Balance of
the Class M-1 Certificates (after
taking into account the distribution of the
Class M-1 Principal Distribution
Amount on such Distribution Date), and (C)
the Class Certificate Balance of the
Class M-2 Certificates immediately prior to
such Distribution Date over (ii) the
lesser of (A) 84.00% of the aggregate
Stated Principal Balance of the Mortgage
Loans for such Distribution Date and (B)
the excess, if any, of the aggregate
Stated Principal Balance of the Mortgage
Loans for such Distribution Date over
the Overcollateralization Floor.
Class M-3 Certificates: All Certificates bearing the class
designation of "Class M-3."
Class M-3 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
sum of (A) the aggregate Class
Certificate Balances of the Class A
Certificates (after taking into account the
distribution of the Class A Principal
Distribution Amount on such Distribution
Date), (B) the Class Certificate Balance of
the Class M-1 Certificates (after
taking into account the distribution of the
Class M-1 Principal Distribution
Amount on such Distribution Date), (C) the
Class Certificate Balance of the
Class M-2 Certificates (after taking into
account the distribution of the Class
M-2 Principal Distribution Amount on such
Distribution Date), and (D) the Class
Certificate Balance of the Class M-3
Certificates immediately prior to such
Distribution Date over (ii) the lesser of
(A) 86.00 % of the aggregate Stated
Principal Balance of the Mortgage Loans for
such Distribution Date and (B) the
excess, if any, of the aggregate Stated
Principal Balance of the Mortgage Loans
for such Distribution Date over the
Overcollateralization Floor.
Class N Certificates: All Certificates bearing the class
designation
of "Class N."
Class N Notional Amount: With respect to the Class N
Certificates
and any Distribution Date, an amount equal
to the Original Class N Notional
Amount reduced by the aggregate
distributions made to the Class N Certificates
pursuant to Section 4.02 in reduction of
the Class N Notional Amount.
Class R Certificates: The Class R-1 and Class R-2 Certificates.
Class R-1 Certificates: All Certificates bearing the class
designation of "Class R-1."
Class R-2 Certificates: All Certificates bearing the class
designation of "Class R-2."
Class UT-R Interest: The residual interest in the Upper Tier
REMIC
as described in the Preliminary Statement
and the related footnote thereto.
Class X Certificates: All Certificates bearing the class
designation
of "Class X."
Class X Distributable Amount: On any Distribution Date, (i) as
a
distribution in respect of interest, the
amount of interest that has accrued on
the Class X Interest and not applied as an
Extra Principal Distribution Amount
on such Distribution Date, plus any such
accrued interest remaining
undistributed from prior Distribution
Dates, plus, without duplication, (ii) as
a distribution in respect of principal, any
portion of the principal balance of
the Class X Interest which is distributable
as an Overcollateralization
Reduction Amount, minus (iii) any amounts
paid as a Basis Risk Payment.
Class X/N Regular Interest: A regular interest in the Class X
REMIC
as specified and described in the
Preliminary Statement and the related footnote
thereto.
Class X Interest: The Upper Tier Regular Interest held by the
Class
X REMIC as specified and described in the
Preliminary Statement and the related
footnote thereto.
Class X-R Interest: The residual interest in the Class X REMIC
as
described in the Preliminary Statement and
the related footnote thereto.
Class X REMIC: As described in the Preliminary Statement.
Closing Date: February 25, 2005.
Code: The Internal Revenue Code of 1986, including any successor
or
amendatory provisions.
Collection Account: As defined in Section 3.10(a).
Combined Loan-to-Value Ratio: As of the date of origination and
as
to any Second Lien Mortgage Loan, the
ratio, expressed as a percentage, of (a)
the sum of (i) the outstanding principal
balance of the Second Lien Mortgage
Loan as of the date of origination and (ii)
the outstanding principal balance as
of the date of origination of any mortgage
loan or mortgage loans that are
senior or equal in priority to the Second
Lien Mortgage Loan and which are
secured by the same Mortgaged Property to
(b) the Appraised Value.
Compensating Interest: For any Distribution Date, the lesser of
(a)
the Prepayment Interest Shortfall, if any,
for such Distribution Date, with
respect to voluntary Principal Prepayments
in Full (excluding any payments made
upon liquidation of the Mortgage Loan)
during the related Prepayment Period, and
(b) one-half of the Servicing Fee payable
to the Servicer for such Distribution
Date.
Condemnation Proceeds: All awards, compensation and/or
settlements
in respect of a Mortgaged Property, whether
permanent or temporary, partial or
entire, by exercise of the power of eminent
domain or condemnation.
Corporate Trust Office: The designated office of the Trustee in
the
State of California at which at any
particular time its corporate trust business
with respect to this Agreement is
administered, which office at the date of the
execution of this Agreement is located at
1761 East St. Andrew Place Santa Ana,
California 92705-4934, Attn: Trust
Administration-GS05C1, facsimile no. (714)
247-6478 and which is the address to which
notices to and correspondence with
the Trustee should be directed.
Corresponding Class and Corresponding REMIC: The class of
interests
in any Trust REMIC created under this
Agreement that corresponds to the class of
interests in another such Trust REMIC or to
a Class of Certificates and the
Trust REMIC in which the corresponding
Certificate represents the related
regular interest issued for such Trust
REMIC in the manner set out below:
Corresponding
Class of
Lower Tier
Upper Tier
Certificates or
Corresponding
Class Designation Regular Interest
Regular
Interest
REMIC
----------------- ----------------
----------------
-----
Class LT-A-1
Class A-1
Class A-1
Upper Tier REMIC
Class LT-A-2
Class A-2
Class A-2
Upper Tier REMIC
Class LT-A-3
Class A-3
Class A-3
Upper Tier REMIC
Class LT-M-1
Class M-1
Class M-1
Upper Tier REMIC
Class LT-M-2
Class M-2
Class M-2
Upper Tier REMIC
Class LT-M-3
Class M-3
Class M-3
Upper Tier REMIC
Class LT-B-1
Class B-1
Class B-1
Upper Tier REMIC
Class LT-B-2
Class B-2
Class B-2
Class B-2 REMIC
Class LT-B-3
Class B-3
Class B-3
Class B-3 REMIC
Class LT-B-4
Class B-4
Class B-4
Class B-4 REMIC
N/A
Class X
Class X/N
Class X REMIC
Cumulative Loss Event: With respect to any Distribution Date, a
Cumulative Loss Event occurs if the
Cumulative Loss Percentage exceeds the
applicable percentage set forth below with
respect to such Distribution Date:
--------------------------------------------------------------------------
Distribution Date Occurring In
Loss Percentage
--------------------------------------------------------------------------
March 2008
through February 2009 4.000%
of the Cut-off Date Pool
Principal Balance
--------------------------------------------------------------------------
March 2009
through February 2010 5.750%
of the Cut-off Date Pool
Principal Balance
--------------------------------------------------------------------------
March 2010
through February 2011 7.250%
of the Cut-off Date Pool
Principal Balance
--------------------------------------------------------------------------
March 2011
and thereafter
7.750% of the Cut-off Date Pool
Principal Balance
--------------------------------------------------------------------------
Cumulative Loss Percentage: As of any date of determination,
the
percentage equivalent of a fraction, the
numerator of which is the aggregate
amount of Realized Losses on the Mortgage
Loans for the period from the Cut-off
Date to the date of determination and the
denominator of which is the Stated
Principal Balance of the Mortgage Loans as
of the Cut-off Date.
Custodial File: With respect to each Mortgage Loan, the file
retained by the Trustee consisting of items
(a) - (h) as listed on Exhibit L
hereto.
Cut-off Date: February 1, 2005.
Cut-off Date Pool Principal Balance: The aggregate Stated
Principal
Balances of all Mortgage Loans as of the
Cut-off Date.
Cut-off Date Principal Balance: As to any Mortgage Loan, the
Stated
Principal Balance thereof as of the close
of business on the Cut-off Date (after
giving effect to payments of principal due
on that date, whether or not
received).
Data Tape Information: The information provided by the
Responsible
Party as of the Cut-off Date to the
Depositor setting forth the following
information with respect to each Mortgage
Loan: (1) the Responsible Party's
Mortgage Loan identifying number; (2) the
Mortgagor's name; (3) the street
address of the Mortgaged Property including
the city, state and zip code; (4) a
code indicating whether the Mortgaged
Property is owner-occupied, a second home
or investment property; (5) the number and
type of residential units
constituting the Mortgaged Property (i.e.,
a single family residence, a 2-4
family residence, a unit in a condominium
project or a unit in a planned unit
development, manufactured housing); (6) the
original months to maturity or the
remaining months to maturity from the
Cut-off Date, in any case based on the
original amortization schedule and, if
different, the maturity expressed in the
same manner but based on the actual
amortization schedule; (7) with respect to
First Lien Mortgage Loans, the
Loan-to-Value Ratio, and with respect to the
Second Lien Mortgage Loans, the Combined
Loan-to-Value Ratio at origination; (8)
the Mortgage Interest Rate as of the
Cut-off Date; (9) the date on which the
Scheduled Payment was due on the Mortgage
Loan and, if such date is not
consistent with the Due Date currently in
effect, such Due Date; (10) the stated
maturity date; (11) the amount of the
Scheduled Payment as of the Cut-off Date;
(12) the last payment date on which a
Scheduled Payment was actually applied to
pay interest and the outstanding principal
balance; (13) the original principal
amount of the Mortgage Loan; (14) the
principal balance of the Mortgage Loan as
of the close of business on the Cut-off
Date, after deduction of payments of
principal due and collected on or before
the Cut-off Date; (15) with respect to
Adjustable Rate Mortgage Loans, the
Adjustment Date; (16) with respect to
Adjustable Rate Mortgage Loans, the Gross
Margin; (17) with respect to
Adjustable Rate Mortgage Loans, the
Lifetime Rate Cap under the terms of the
Mortgage Note; (18) with respect to
Adjustable Rate Mortgage Loans, a code
indicating the type of Index; (19) with
respect to Adjustable Rate Mortgage
Loans, the Periodic Mortgage Interest Rate
Cap under the terms of the Mortgage
Note; (20) the type of Mortgage Loan (i.e.,
fixed rate, adjustable rate, first
lien, second lien); (21) a code indicating
the purpose of the loan (i.e.,
purchase, rate and term refinance, equity
take-out refinance); (22) a code
indicating the documentation style (i.e.,
full documentation, limited
documentation or stated income); (23) the
loan credit classification (as
described in the Underwriting Guidelines);
(24) whether such Mortgage Loan
provides for a Prepayment Premium; (25) the
Prepayment Premium period of such
Mortgage Loan, if applicable; (26) a
description of the Prepayment Premium, if
applicable; (27) the Mortgage Interest Rate
as of origination; (28) the credit
risk score (FICO score) at origination;
(29) the date of origination; (30) the
Mortgage Interest Rate adjustment period;
(31) the Mortgage Interest Rate floor;
(32) the Mortgage Interest Rate calculation
method (i.e., 30/360, simple
interest, other); (33) a code indicating
whether the Mortgage Loan has been
modified; (34) with respect to First Lien
Mortgage Loans, the current
Loan-to-Value Ratio, and with respect to
Second Lien Mortgage Loans, the current
Combined Loan-to-Value Ratio; (35) the one
year payment history; (36) the Due
Date for the first Scheduled Payment; (37)
the original Scheduled Payment due;
(38) with respect to the related Mortgagor,
the debt-to-income ratio; (39) the
Appraised Value of the Mortgaged Property;
(40) the sales price of the Mortgaged
Property if the Mortgage Loan was
originated in connection with the purchase of
the Mortgaged Property; and (41) a code
indicating whether a Mortgage Loan is or
has been 30 days delinquent. With respect
to the Mortgage Loans in the
aggregate: (1) the number of Mortgage
Loans; (2) the current aggregate
outstanding principal balance of the
Mortgage Loans; (3) the weighted average
Mortgage Interest Rate of the Mortgage
Loans; and (4) the weighted average
maturity of the Mortgage Loans.
Debt Service Reduction: With respect to any Mortgage Loan, a
reduction by a court of competent
jurisdiction in a proceeding under the United
States Bankruptcy Code in the Scheduled
Payment for such Mortgage Loan which
became final and non-appealable, except for
such a reduction resulting from a
Deficient Valuation or any reduction that
results in a permanent forgiveness of
principal.
Deficient Valuation: With respect to any Mortgage Loan, a
valuation
of the related Mortgaged Property by a
court of competent jurisdiction in an
amount less than the then outstanding
principal balance of the Mortgage Loan,
which valuation results from a proceeding
initiated under the United States
Bankruptcy Code.
Definitive Certificates: Any Certificate evidenced by a
Physical
Certificate and any Certificate issued in
lieu of a Book-Entry Certificate
pursuant to Section 5.02(e).
Delay Certificates: As specified in the Preliminary Statement.
Deleted Mortgage Loan: As defined in Section 2.03(d).
Denomination: With respect to each Certificate, the amount set
forth
on the face thereof as the "Initial
Certificate Balance of this Certificate" or
the Percentage Interest appearing on the
face thereof.
Depositor: GS Mortgage Securities Corp., a Delaware corporation,
and
its successors in interest.
Depository: The initial Depository shall be The Depository
Trust
Company, the nominee of which is CEDE &
Co., as the registered Holder of the
Book-Entry Certificates. The Depository
shall at all times be a "clearing
corporation" as defined in Section
8-102(a)(5) of the Uniform Commercial Code of
the State of New York.
Depository Institution: Any depository institution or trust
company,
including the Trustee, that (a) is
incorporated under the laws of the United
States of America or any State thereof, (b)
is subject to supervision and
examination by federal or state banking
authorities and (c) has outstanding
unsecured commercial paper or other
short-term unsecured debt obligations that
are rated "P-1" by Moody's, "A-1" by
Standard & Poor's and "F1+" by Fitch (in
each case, to the extent they are
designated as Rating Agencies in the
Preliminary Statement).
Depository Participant: A broker, dealer, bank or other
financial
institution or other Person for whom from
time to time a Depository effects
book-entry transfers and pledges of
securities deposited with the Depository.
Determination Date: With respect to each Distribution Date, the
18th
day of the calendar month in which such
Distribution Date occurs, or if such
18th day is not a Business Day, the
Business Day immediately preceding such 18th
day.
Distribution Account: The separate Eligible Account created and
maintained by the Trustee pursuant to
Section 3.27(b) in the name of the Trustee
for the benefit of the Certificateholders
and designated "Deutsche Bank National
Trust Company in trust for registered
holders of GSAMP Trust 2005-NC1 Mortgage
Pass-Through Certificates, Series
2005-NC1." Funds in the Distribution Account
shall be held in trust for the
Certificateholders for the uses and purposes set
forth in this Agreement and may be invested
in Permitted Investments.
Distribution Date: The 25th day of each calendar month after
the
initial issuance of the Certificates, or if
such day is not a Business Day, the
next succeeding Business Day, commencing in
March 2005.
Document Certification and Exception Report: The report attached
to
Exhibit F hereto.
Due Date: The day of the month on which the Scheduled Payment is
due
on a Mortgage Loan, exclusive of any days
of grace.
Due Period: With respect to any Distribution Date, the period
commencing on the second day of the
calendar month preceding the month in which
the Distribution Date occurs and ending on
the first day of the calendar month
in which the Distribution Date occurs.
Eligible Account: Either (i) an account maintained with a federal
or
state chartered depository institution or
trust company the short-term unsecured
debt obligations of which (or, in the case
of a depository institution or trust
company that is a subsidiary of a holding
company, the short-term unsecured debt
obligations of such holding company) are
rated "A-1" by Standard & Poor's, "F-1"
by Fitch and "P-1" by Moody's (in each
case, to the extent they are designated
as Rating Agencies in the Preliminary
Statement) (and a comparable rating if
another Rating Agency is specified by the
Depositor by written notice to the
Servicer) at the time any amounts are held
on deposit therein, (ii) a trust
account or accounts maintained with a
federal or state chartered depository
institution or trust company acting in its
fiduciary capacity or (iii) any other
account acceptable to each Rating Agency.
Eligible Accounts may bear interest,
and may include, if otherwise qualified
under this definition, accounts
maintained with the Trustee.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA-Qualifying Underwriting: A best efforts or firm
commitment
underwriting or private placement that
meets the requirements of Prohibited
Transaction Exemption ("PTE") 2002-41, 67
Fed. Reg. 54487 (2002) (or any
successor thereto), or any substantially
similar administrative exemption
granted by the U.S. Department of
Labor.
ERISA-Restricted Certificate: As specified in the Preliminary
Statement.
Escrow Account: The Eligible Account or Accounts established
and
maintained pursuant to Section 3.09(b).
Escrow Payments: As defined in Section 3.09(b) of this
Agreement.
Event of Default: As defined in Section 7.01.
Excess Overcollateralized Amount: With respect to any
Distribution
Date, the excess, if any, of (a) the
Overcollateralized Amount on such
Distribution Date over (b) the Specified
Overcollateralized Amount for such
Distribution Date.
Excess Reserve Fund Account: The separate Eligible Account
created
and maintained by the Trustee pursuant to
Sections 3.27(a) in the name of the
Trustee for the benefit of the Regular
Certificateholders and designated
"Deutsche Bank National Trust Company in
trust for registered holders of GSAMP
Trust 2005-NC1, Mortgage Pass-Through
Certificates, Series 2005-NC1." Funds in
the Excess Reserve Fund Account shall be
held in trust for the Regular
Certificateholders for the uses and
purposes set forth in this Agreement.
Amounts on deposit in the Excess Reserve
Fund Account shall not be invested.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Expense Fee Rate: As to each Mortgage Loan, a per annum rate
equal
to the sum of the Servicing Fee Rate and
the Trustee Fee Rate.
Expense Fees: As to each Mortgage Loan, the sum of the Servicing
Fee
and the Trustee Fee.
Extra Principal Distribution Amount: As of any Distribution
Date,
the lesser of (x) the related Total Monthly
Excess Spread for such Distribution
Date and (y) the related
Overcollateralization Deficiency for such Distribution
Date.
Fannie Mae: The Federal National Mortgage Association and its
successors in interest.
Fannie Mae Guides: The Fannie Mae Seller's Guide and the Fannie
Mae
Servicer's Guide and all amendments or
additions thereto.
FDIC: The Federal Deposit Insurance Corporation, or any
successor
thereto.
Final Recovery Determination: With respect to any defaulted
Mortgage
Loan or any REO Property (other than a
Mortgage Loan or REO Property purchased
by the Responsible Party as contemplated by
this Agreement), a determination
made by the Servicer that all Insurance
Proceeds, Condemnation Proceeds,
Liquidation Proceeds and other payments or
recoveries which the Servicer, in its
reasonable good faith judgment, expects to
be finally recoverable in respect
thereof have been so recovered. The
Servicer shall maintain records, prepared by
a Servicing Officer, of each Final Recovery
Determination made thereby.
Final Scheduled Distribution Date: The Final Scheduled
Distribution
Date for each Class of Certificates is the
Distribution Date occurring in
February 2035.
First Lien Mortgage Loan: Any Mortgage Loan secured by a first
lien
Mortgage on the related Mortgaged
Property.
Fitch: Fitch, Inc., and its successors in interest. If Fitch is
designated as a Rating Agency in the
Preliminary Statement, for purposes of
Section 10.05(b) the address for notices to
Fitch shall be Fitch, Inc., One
State Street Plaza, New York, New York
10004, Attention: MBS Monitoring - GSAMP
Trust 2005-NC1, or such other address as
Fitch may hereafter furnish to the
Depositor, the Servicer and the
Trustee.
Fixed Rate Mortgage Loan: A fixed rate Mortgage Loan.
Forbearance: As defined in Section 3.07(a).
Freddie Mac: The Federal Home Loan Mortgage Corporation, a
corporate
instrumentality of the United States
created and existing under Title III of the
Emergency Home Finance Act of 1970, as
amended, and its successors in interest.
Gross Margin: With respect to each Adjustable Rate Mortgage
Loan,
the fixed percentage amount set forth in
the related Mortgage Note to be added
to the applicable Index to determine the
Mortgage Interest Rate.
High Cost Mortgage Loan: A Mortgage Loan that is (a) covered by
the
Home Ownership and Equity Protection Act of
1994, (b) identified, classified or
characterized as "high cost," "threshold,"
"covered", or "predatory" under any
other applicable state, federal or local
law (or a similarly identified,
classified or characterized loan using
different terminology under a law
imposing heightened regulatory scrutiny or
additional legal liability for
residential mortgage loans having high
interest rates, points and/or fees) or
(c) categorized as "High Cost" or "Covered"
pursuant to Appendix E of the
Standard & Poor's Glossary.
Home Loan: A Mortgage Loan categorized as "Home Loan" pursuant
to
Appendix E of Standard & Poor's
Glossary.
Index: As to each Adjustable Rate Mortgage Loan, the index from
time
to time in effect for the adjustment of the
Mortgage Interest Rate set forth as
such on the related Mortgage Note.
Insurance Policy: With respect to any Mortgage Loan included in
the
Trust Fund, any insurance policy, including
all riders and endorsements thereto
in effect, including any replacement policy
or policies for any Insurance
Policies.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds
of
insurance policies insuring the Mortgage
Loan or the related Mortgaged Property.
Interest Accrual Period: With respect to each Class of
Non-Delay
Certificates, the Class N Certificates and
each Class of Lower Tier Regular
Interests and any Distribution Date, the
period commencing on the Distribution
Date occurring in the month preceding the
month in which the current
Distribution Date occurs and ending on the
day immediately preceding the current
Distribution Date. In the case of the first
Distribution Date, the Interest
Accrual Period is the period from and
including the Closing Date to but
excluding such first Distribution Date,
except for the Class N Certificates,
which is the period from and including the
Closing Date to but excluding such
first Distribution Date. For purposes of
computing interest accruals on each
Class of Non-Delay Certificates, each
Interest Accrual Period has the actual
number of days in such month and each year
is assumed to have 360 days. For
purposes of computing interest accruals on
the Class N Certificates, all
interest accrued on the Class N
Certificates shall be calculated on the basis of
a 360-day year consisting of twelve 30-day
interest accrual periods.
Interest Only Mortgage Loan: A Mortgage Loan for which the
related
Mortgage Note provides for Scheduled
Payments of interest only.
Interest Remittance Amount: With respect to any Distribution
Date,
that portion of Available Funds
attributable to interest relating to the
Mortgage Loans.
Investment Account: As defined in Section 3.12(a).
Late Collections: With respect to any Mortgage Loan and any Due
Period, all amounts received after the
Remittance Date immediately following
such Due Period, whether as late payments
of Scheduled Payments or as Insurance
Proceeds, Condemnation Proceeds,
Liquidation Proceeds or otherwise, which
represent late payments or collections of
principal and/or interest due (without
regard to any acceleration of payments
under the related Mortgage and Mortgage
Note) but delinquent for such Due Period
and not previously recovered.
Lender: As defined in Section 10.07.
LIBOR: With respect to any Interest Accrual Period for the
LIBOR
Certificates, the rate determined by the
Trustee on the related LIBOR
Determination Date on the basis of the
offered rate for one-month U.S. dollar
deposits as such rate appears on Telerate
Page 3750 as of 11:00 a.m. (London
time) on such date; provided, that if such
rate does not appear on Telerate Page
3750, the rate for such date will be
determined on the basis of the rates at
which one-month U.S. dollar deposits are
offered by the Reference Banks at
approximately 11:00 a.m. (London time) on
such date to prime banks in the London
interbank market. In such event, the
Trustee shall request the principal London
office of each of the Reference Banks to
provide a quotation of its rate. If at
least two such quotations are provided, the
rate for that date will be the
arithmetic mean of the quotations (rounded
upwards if necessary to the nearest
whole multiple of 1/16%). If fewer than two
quotations are provided as
requested, the rate for that date will be
the arithmetic mean of the rates
quoted by major banks in New York City,
selected by the Trustee (after
consultation with the Depositor), at
approximately 11:00 a.m. (New York City
time) on such date for one-month U.S.
dollar deposits of leading European banks.
LIBOR Certificates: As specified in the Preliminary Statement.
LIBOR Determination Date: With respect to any Interest Accrual
Period for the LIBOR Certificates, the
second London Business Day preceding the
commencement of such Interest Accrual
Period.
Lifetime Rate Cap: The provision of each Mortgage Note related to
an
Adjustable Rate Mortgage Loan which
provides for an absolute maximum Mortgage
Interest Rate thereunder. The Mortgage
Interest Rate during the terms of each
Adjustable Rate Mortgage Loan shall not at
any time exceed the Mortgage Interest
Rate at the time of origination of such
Adjustable Rate Mortgage Loan by more
than the amount per annum set forth on the
Mortgage Loan Schedule.
Liquidated Mortgage Loan: With respect to any Distribution Date,
a
defaulted Mortgage Loan (including any REO
Property) which was liquidated or
charged off in the calendar month preceding
the month of such Distribution Date
and as to which the Servicer has certified
(in accordance with this Agreement)
that it has made a Final Recovery
Determination.
Liquidation Event: With respect to any Mortgage Loan, any of
the
following events: (i) such Mortgage Loan is
paid in full; (ii) a Final Recovery
Determination is made as to such Mortgage
Loan; or (iii) such Mortgage Loan is
removed from coverage under this Agreement
by reason of its being purchased,
sold or replaced pursuant to or as
contemplated by this Agreement. With respect
to any REO Property, either of the
following events: (i) a Final Recovery
Determination is made as to such REO
Property; or (ii) such REO Property is
removed from coverage under this Agreement
by reason of its being purchased
pursuant to this Agreement.
Liquidation Proceeds: The amounts, other than Insurance
Proceeds,
Condemnation Proceeds or those received
following the acquisition of REO
Property, received in connection with the
liquidation of a defaulted Mortgage
Loan, whether through a trustee's sale,
foreclosure sale or otherwise, including
any Subsequent Recoveries.
Litton: Litton Loan Servicing LP, a Delaware limited
partnership,
and its successors in interest.
Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan,
the
ratio (expressed as a percentage) of the
original outstanding principal amount
of the Mortgage Loan as of the Cut-off Date
(unless otherwise indicated), to
either (a) if the Mortgage Loan was made to
finance the acquisition of the
related Mortgaged Property, the least of
(i) the purchase price of the Mortgaged
Property, (ii) the Appraised Value of the
Mortgaged Property at origination, or
(iii) the Review Appraisal Value of the
Mortgaged Property; or (b) if the
Mortgage Loan was a refinancing or
modification, the Appraised Value of the
Mortgaged Property at the time of the
refinancing or modification.
London Business Day: Any day on which dealings in deposits of
United
States dollars are transacted in the London
interbank market. Lower Tier
Principal Amount: As described in the
Preliminary Statement.
Lower Tier Regular Interest: Each of the Class LT-A-1, Class
LT-A-2,
Class LT-A-3, Class LT-M-1, Class LT-M-2,
Class LT-M-3, Class LT-B-1, Class
LT-B-2, Class LT-B-3, Class LT-B-4 and
Class LT-Accrual Interests as described
in the Preliminary Statement.
Lower Tier REMIC: As described in the Preliminary Statement.
Monthly Statement: The statement made available to the
Certificateholders pursuant to Section
4.03.
Moody's: Moody's Investors Service, Inc., and its successors in
interest. If Moody's is designated as a
Rating Agency in the Preliminary
Statement, for purposes of Section 10.05(b)
the address for notices to Moody's
shall be Moody's Investors Service, Inc.,
99 Church Street, New York, New York
10007, Attention: Residential Mortgage
Pass-Through Group, or such other address
as Moody's may hereafter furnish to the
Depositor, the Servicer and the Trustee.
Mortgage: The mortgage, deed of trust or other instrument
identified
on the Mortgage Loan Schedule as securing a
Mortgage Note, including all riders
thereto.
Mortgage File: The items pertaining to a particular Mortgage
Loan
contained in either the Servicing File or
Custodial File.
Mortgage Interest Rate: The annual rate of interest borne on a
Mortgage Note with respect to each Mortgage
Loan.
Mortgage Loan: An individual Mortgage Loan which is the subject
of
this Agreement, each Mortgage Loan
originally sold and subject to this Agreement
being identified on the Mortgage Loan
Schedule, which Mortgage Loan includes,
without limitation, the Mortgage File, the
Custodial File, the Servicing File,
the Scheduled Payments, Principal
Prepayments, Liquidation Proceeds,
Condemnation Proceeds, Insurance Proceeds,
REO Disposition proceeds, Prepayment
Premiums and all other rights, benefits,
proceeds and obligations arising from
or in connection with such Mortgage Loan,
excluding replaced or repurchased
Mortgage Loans.
Mortgage Loan Documents: The mortgage loan documents pertaining
to
each Mortgage Loan.
Mortgage Loan Schedule: A schedule of Mortgage Loans annexed
hereto
as Schedule I, such schedule setting forth
the following information with
respect to each Mortgage Loan as of the
Cut-off Date: (1) the Responsible
Party's Mortgage Loan identifying number;
(2) the Mortgagor's name; (3) the
street address of the Mortgaged Property
including the city, state and zip code;
(4) a code indicating whether the Mortgaged
Property is owner-occupied, a second
home or investment property; (5) the number
and type of residential units
constituting the Mortgaged Property (i.e.,
a single family residence, a 2-4
family residence, a unit in a condominium
project or a unit in a planned unit
development, manufactured housing); (6) the
original months to maturity or the
remaining months to maturity from the
Cut-off Date, in any case based on the
original amortization schedule and, if
different, the maturity expressed in the
same manner but based on the actual
amortization schedule; (7) with respect to
First Lien Mortgage Loans, the
Loan-to-Value Ratio at origination, and with
respect to Second Lien Mortgage Loans, the
Combined Loan-to-Value Ratio, at
origination; (8) the Mortgage Interest Rate
as of the Cut-off Date; (9) the date
on which the Scheduled Payment was due on
the Mortgage Loan and, if such date is
not consistent with the Due Date currently
in effect, such Due Date; (10) the
stated maturity date; (11) the amount of
the Scheduled Payment as of the Cut-off
Date; (12) the last payment date on which a
Scheduled Payment was actually
applied to pay interest and the outstanding
principal balance; (13) the original
principal amount of the Mortgage Loan; (14)
the principal balance of the
Mortgage Loan as of the close of business
on the Cut-off Date, after deduction
of payments of principal due and collected
on or before the Cut-off Date; (15)
with respect to Adjustable Rate Mortgage
Loans, the Adjustment Date; (16) with
respect to Adjustable Rate Mortgage Loans,
the Gross Margin; (17) with respect
to Adjustable Rate Mortgage Loans, the
Lifetime Rate Cap under the terms of the
Mortgage Note; (18) with respect to
Adjustable Rate Mortgage Loans, a code
indicating the type of Index; (19) with
respect to Adjustable Rate Mortgage
Loans, the Periodic Mortgage Interest Rate
Cap under the terms of the Mortgage
Note; (20) with respect to Adjustable Rate
Mortgage Loans, the Periodic Mortgage
Interest Rate Floor under the terms of the
Mortgage Note; (21) the type of
Mortgage Loan (i.e., fixed rate, adjustable
rate, first lien, second lien); (22)
a code indicating the purpose of the loan
(i.e., purchase, rate and term
refinance, equity take-out refinance); (23)
a code indicating the documentation
style (i.e., full, limited or stated
income); (24) the loan credit
classification (as described in the
Underwriting Guidelines); (25) whether such
Mortgage Loan provides for a Prepayment
Premium; (26) the Prepayment Premium
period of such Mortgage Loan, if
applicable; (27) a description of the
Prepayment Premium, if applicable; (28) the
Mortgage Interest Rate as of
origination; (29) the credit risk score
(FICO score) at origination; (30) the
date of origination; (31) the Mortgage
Interest Rate adjustment period; (32) the
Mortgage Interest Rate adjustment
percentage; (33) the Mortgage Interest Rate
floor; (34) the Mortgage Interest Rate
calculation method (i.e., 30/360, simple
interest, other); (35) a code indicating
whether the Mortgage Loan is assumable;
(36) a code indicating whether the Mortgage
Loan has been modified; (37) the one
year payment history; (38) the Due Date for
the first Scheduled Payment; (39)
the original Scheduled Payment due; (40)
with respect to the related Mortgagor,
the debt-to-income ratio; (41) the
Appraised Value of the Mortgaged Property;
(42) the sales price of the Mortgaged
Property if the Mortgage Loan was
originated in connection with the purchase
of the Mortgaged Property; (43) a
code indicating if the Mortgage Loan is an
Interest Only Mortgage Loan; (44) a
code indicating whether such Mortgage Loan
is a Home Loan; and (45) a code
indicating whether a Mortgage Loan is or
has been 30 days delinquent. With
respect to the Mortgage Loans in the
aggregate: (1) the number of Mortgage
Loans; (2) the current aggregate
outstanding principal balance of the Mortgage
Loans; (3) the weighted average Mortgage
Interest Rate of the Mortgage Loans;
and (4) the weighted average maturity of
the Mortgage Loans.
Mortgage Note: The note or other evidence of the indebtedness of
a
Mortgagor under a Mortgage Loan, including
all riders thereto.
Mortgaged Property: The real property (or leasehold estate, if
applicable) identified on the Mortgage Loan
Schedule as securing repayment of
the debt evidenced by a Mortgage Note.
Mortgagor: The obligor(s) on a Mortgage Note.
Net Monthly Excess Cash Flow: For any Distribution Date the
amount
remaining for distribution pursuant to
Section 4.02(a)(iii) (before giving
effect to distributions pursuant to such
Section 4.02(a)(iii)).
Net Prepayment Interest Shortfall: For any Distribution Date,
the
amount by which the sum of the Prepayment
Interest Shortfalls exceeds the sum of
the Compensating Interest payments made
with respect to such Distribution Date.
NIM Issuer: The entity established as the issuer of the NIM
Securities.
NIM Securities: Any debt securities secured or otherwise backed
by
some or all of the Class X and Class N
Certificates that are rated by one or
more Rating Agencies.
NIM Trustee: The trustee for the NIM Securities.
90+ Day Delinquent Mortgage Loan: Each Mortgage Loan with respect
to
which any portion of a Scheduled Payment
is, as of the last day of the prior Due
Period, three months or more past due
(without giving effect to any grace
period).
Non-Delay Certificates: As specified in the Preliminary
Statement.
Nonrecoverable P&I Advance: Any P&I Advance previously made
or
proposed to be made in respect of a
Mortgage Loan or REO Property that, in the
good faith business judgment of the
Servicer, will not or, in the case of a
proposed P&I Advance, would not be
ultimately recoverable from related late
payments, Insurance Proceeds, Condemnation
Proceeds or Liquidation Proceeds on
such Mortgage Loan or REO Property as
provided herein.
Nonrecoverable Servicing Advance: Any Servicing Advances
previously
made or proposed to be made in respect of a
Mortgage Loan or REO Property,
which, in the good faith business judgment
of the Servicer, will not or, in the
case of a proposed Servicing Advance, would
not, be ultimately recoverable from
related Insurance Proceeds, Condemnation
Proceeds, Liquidation Proceeds or
otherwise.
Non-Rule 144A Investment Letter: As defined in Section 5.02(b).
Notice of Final Distribution: The notice to be provided pursuant
to
Section 9.02 to the effect that final
distribution on any of the Certificates
shall be made only upon presentation and
surrender thereof.
Offered Certificates: As specified in the Preliminary
Statement.
Officer's Certificate: A certificate signed by an officer of
the
Servicer with responsibility for the
servicing of the Mortgage Loans and listed
on a list delivered to the Trustee pursuant
to this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be
in-house counsel for the Servicer or a
Subservicer, reasonably acceptable to the
Trustee; provided, that any Opinion of
Counsel relating to (a) qualification of
any Trust REMIC as a REMIC or (b)
compliance with the REMIC Provisions, must be
(unless otherwise stated in such Opinion of
Counsel) an opinion of counsel who
(i) is in fact independent of the Servicer
of the Mortgage Loans, (ii) does not
have any material direct or indirect
financial interest in the Servicer of the
Mortgage Loans or in an affiliate of either
and (iii) is not connected with the
Servicer of the Mortgage Loans as an
officer, employee, director or person
performing similar functions.
Optional Termination Date: The date determined by the Servicer
and
specified in a written notice to the
Trustee, which may occur on or after the
Distribution Date on which the aggregate
Stated Principal Balance of the
Mortgage Loans, as of the last day of the
related Due Period, is equal to 10.00%
or less of the Cut-off Date Pool Principal
Balance.
Original Class N Notional Amount: $28,217,000.
OTS: Office of Thrift Supervision, and any successor thereto.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore
executed and authenticated under
this Agreement except:
(i) Certificates theretofore canceled by the Trustee or delivered
to
the
Trustee for cancellation; and
(ii) Certificates in exchange for which or in lieu of which
other
Certificates have been executed and delivered by the Trustee
pursuant to
this
Agreement.
Outstanding Mortgage Loan: As of any Due Date, a Mortgage Loan
with
a Stated Principal Balance greater than
zero which was not the subject of a
Principal Prepayment in Full prior to such
Due Date and which did not become a
Liquidated Mortgage Loan prior to such Due
Date.
Overcollateralized Amount: As of any Distribution Date, the
excess,
if any, of (a) the aggregate Stated
Principal Balance of the Mortgage Loans for
such Distribution Date over (b) the
aggregate of the Class Certificate Balances
of the LIBOR Certificates as of such
Distribution Date (after giving effect to
the payment of the Principal Remittance
Amount on such Certificates on such
Distribution Date).
Overcollateralization Deficiency: With respect to any
Distribution
Date, the excess, if any, of (a) the
Specified Overcollateralized Amount
applicable to such Distribution Date over
(b) the Overcollateralized Amount
applicable to such Distribution Date.
Overcollateralization Floor: With respect to any Distribution
Date,
0.50% of the aggregate Stated Principal
Balance of the Mortgage Loans as of the
Cut-off Date.
Overcollateralization Reduction Amount: With respect to any
Distribution Date, an amount equal to the
lesser of (a) the Excess
Overcollateralized Amount and (b) the Net
Monthly Excess Cash Flow.
Ownership Interest: As to any Residual Certificate, any
ownership
interest in such Certificate including any
interest in such Certificate as the
Holder thereof and any other interest
therein, whether direct or indirect, legal
or beneficial.
P&I Advance: As to any Mortgage Loan or REO Property, any
advance
made by the Servicer in respect of any
Remittance Date representing the
aggregate of all payments of principal and
interest, net of the Servicing Fee,
that were due during the related Due Period
on the Mortgage Loans and that were
delinquent on the related Remittance Date,
plus certain amounts representing
assumed payments not covered by any current
net income on the Mortgaged
Properties acquired by foreclosure or deed
in lieu of foreclosure as determined
pursuant to Section 4.01.
Pass-Through Rate: For each Class of Regular Certificates, the
Class
X/N Regular Interest, each Upper Tier
Regular Interest and each Lower Tier
Regular Interest, the per annum rate set
forth or calculated in the manner
described in the Preliminary Statement.
With respect to the Class N
Certificates, 5.00% per annum.
Percentage Interest: As to any Certificate, the percentage
interest
evidenced thereby in distributions required
to be made on the related Class,
such percentage interest being set forth on
the face thereof or equal to the
percentage obtained by dividing the
Denomination of such Certificate by the
aggregate of the Denominations of all
Certificates of the same Class.
Periodic Mortgage Interest Rate Cap: The provision of each
Mortgage
Note related to an Adjustable Rate Mortgage
Loan which provides for an absolute
maximum amount by which the Mortgage
Interest Rate therein may increase or
decrease on an Adjustment Date above or
below the Mortgage Interest Rate
previously in effect. The Periodic Mortgage
Interest Rate Cap for each
Adjustable Rate Mortgage Loan is the rate
set forth on the Mortgage Loan
Schedule.
Periodic Mortgage Interest Rate Floor: The provision of each
Mortgage Note related to an Adjustable Rate
Mortgage Loan which provides for an
absolute minimum amount by which the
Mortgage Interest Rate therein may increase
or decrease on an Adjustment Date above or
below the Mortgage Interest Rate
previously in effect. The Periodic Mortgage
Interest Rate Floor for each
Adjustable Rate Mortgage Loan is the rate
set forth on the Mortgage Loan
Schedule.
Permitted Investments: Any one or more of the following
obligations
or securities acquired at a purchase price
of not greater than par, regardless
of whether issued by the Servicer, the
Trustee or any of their respective
Affiliates:
(i) direct obligations of, or obligations fully guaranteed as
to
timely
payment of principal and interest by, the United States or any
agency or
instrumentality thereof, provided such obligations are backed
by
the full
faith and credit of the United States;
(ii) demand and time deposits in, certificates of deposit of,
or
bankers'
acceptances (which shall each have an original maturity of not
more than
90 days and, in the case of bankers' acceptances, shall in no
event have
an original maturity of more than 365 days or a remaining
maturity
of more than 30 days) denominated in United States dollars and
issued by
any Depository Institution and rated "A-1+" by Standard &
Poor's,
"P-1" by Moody's and "F1+" by Fitch (in each case, to the
extent
they are
designated as Rating Agencies in the Preliminary Statement);
(iii) repurchase obligations with respect to any security
described
in clause
(i) above entered into with a Depository Institution (acting as
principal);
(iv) securities bearing interest or sold at a discount that are
issued by any
corporation incorporated under the laws of the United States
of America
or any state thereof and that are rated by each Rating Agency
that rates
such securities in its highest long-term unsecured rating
categories
at the time of such investment or contractual commitment
providing
for such investment;
(v) commercial paper (including both non-interest-bearing
discount
obligations and interest-bearing obligations payable on demand or
on a
specified
date not more than 30 days after the date of acquisition
thereof)
that is rated by each Rating Agency that rates such securities
in
its
highest short-term unsecured debt rating available at the time of
such
investment;
(vi) units of money market funds, including money market funds
advised by
the Depositor or the Trustee or an Affiliate thereof, that have
been rated
"Aaa" by Moody's, "AAAm" or "AAAm-G" by Standard & Poor's
and
at least
"AA" by Fitch (in each case, to the extent they are designated
as
Rating
Agencies in the Preliminary Statement); and
(vii) if previously confirmed in writing to the Trustee, any
other
demand,
money market or time deposit, or any other obligation, security
or
investment, as may be acceptable to the Rating Agencies as a
permitted
investment
of funds backing "Aaa" or "AAA" rated securities;
provided, however, that no instrument
described hereunder shall evidence either
the right to receive (a) only interest with
respect to the obligations
underlying such instrument or (b) both
principal and interest payments derived
from obligations underlying such instrument
and the interest and principal
payments with respect to such instrument
provide a yield to maturity at par
greater than 120% of the yield to maturity
at par of the underlying obligations.
Permitted Transferee: Any Person other than (i) the United
States,
any State or political subdivision thereof,
or any agency or instrumentality of
any of the foregoing, (ii) a foreign
government, international organization or
any agency or instrumentality of either of
the foregoing, (iii) an organization
(except certain farmers' cooperatives
described in Section 521 of the Code)
which is exempt from tax imposed by Chapter
1 of the Code (including the tax
imposed by Section 511 of the Code on
unrelated business taxable income) on any
excess inclusions (as defined in Section
860E(c)(1) of the Code) with respect to
any Residual Certificate, (iv) rural
electric and telephone cooperatives
described in Section 1381(a)(2)(C) of the
Code, (v) a Person that is not a U.S.
Person or a U.S. Person with respect to
whom income from a Residual Certificate
is attributable to a foreign permanent
establishment or fixed base (within the
meaning of an applicable income tax treaty)
of such Person or any other U.S.
Person, (vi) an "electing large
partnership" within the meaning of Section 775
of the Code and (vii) any other Person so
designated by the Depositor based upon
an Opinion of Counsel that the Transfer of
an Ownership Interest in a Residual
Certificate to such Person may cause any
Trust REMIC to fail to qualify as a
REMIC at any time that the Certificates are
outstanding. The terms "United
States," "State" and "international
organization" shall have the meanings set
forth in Section 7701 of the Code or
successor provisions. A corporation will
not be treated as an instrumentality of the
United States or of any State or
political subdivision thereof for these
purposes if all of its activities are
subject to tax and, with the exception of
Freddie Mac, a majority of its board
of directors is not selected by such
government unit.
Person: Any individual, corporation, partnership, joint
venture,
association, limited liability company,
joint-stock company, trust,
unincorporated organization or government,
or any agency or political
subdivision thereof.
Physical Certificates: As specified in the Preliminary
Statement.
Plan: As defined in Section 5.02(b).
Pool Stated Principal Balance: As to any Distribution Date, the
aggregate of the Stated Principal Balances
of the Mortgage Loans for such
Distribution Date that were Outstanding
Mortgage Loans on the Due Date in the
related Due Period.
Prepayment Interest Shortfall: With respect to any Remittance
Date,
the sum of, for each Mortgage Loan that
was, during the related Prepayment
Period, the subject of a Principal
Prepayment that was applied by the Servicer
to reduce the outstanding principal balance
of such Mortgage Loan on a date
preceding the Due Date in the succeeding
Prepayment Period, an amount equal to
the product of (a) the Mortgage Interest
Rate net of the Servicing Fee Rate for
such Mortgage Loan, (b) the amount of the
Principal Prepayment for such Mortgage
Loan, (c) 1/360 and (d) the number of days
commencing on the date on which such
Principal Prepayment was applied and ending
on the last day of the related
Prepayment Period.
Prepayment Period: With respect to any Distribution Date, the
calendar month preceding the calendar month
in which such Distribution Date
occurs.
Prepayment Premium: Any prepayment premium, penalty or charge
collected by the Servicer with respect to a
Mortgage Loan from a Mortgagor in
connection with any voluntary Principal
Prepayment in Full pursuant to the terms
of the related Mortgage Note.
Principal Distribution Amount: For any Distribution Date, the sum
of
(i) the Basic Principal Distribution Amount
for such Distribution Date and (ii)
the Extra Principal Distribution Amount for
such Distribution Date.
Principal Prepayment: Any full or partial payment or other
recovery
of principal on a Mortgage Loan (including
upon liquidation of a Mortgage Loan)
which is received in advance of its
scheduled Due Date, excluding any Prepayment
Premium and which is not accompanied by an
amount of interest representing
scheduled interest due on any date or dates
in any month or months subsequent to
the month of prepayment.
Principal Prepayment in Full: Any Principal Prepayment made by
a
Mortgagor of the entire principal balance
of a Mortgage Loan.
Principal Remittance Amount: With respect to any Distribution
Date,
the amount equal to the sum of the
following amounts (without duplication) with
respect to the related Due Period: (i) each
scheduled payment of principal on a
Mortgage Loan due during such Due Period
and received by the Servicer on or
prior to the related Determination Date or
advanced by the Servicer prior to the
related Remittance Date, (ii) all Principal
Prepayments received during the
related Prepayment Period, (iii) all
Liquidation Proceeds, Condemnation Proceeds
and Insurance Proceeds on the Mortgage
Loans allocable to principal actually
collected by the Servicer during the
related Prepayment Period, (iv) the portion
of the Repurchase Price allocable to
principal with respect to each Mortgage
Loan that was repurchased during the period
from the Remittance Date prior to
the prior Distribution Date (or from the
Closing Date in the case of the first
Distribution Date) through the Remittance
Date prior to the current Distribution
Date, (v) the principal portion of all
Substitution Adjustment Amounts with
respect to the substitutions of Mortgage
Loans that occur during the calendar
month in which such Distribution Date
occurs, and (vi) the allocable portion of
the proceeds received with respect to the
termination of the Trust Fund pursuant
to clause (a) of Section 9.01 (to the
extent such proceeds relate to principal).
Privacy Laws: Title V of the Gramm Leach Bliley Act of 1999, as
amended, and all applicable regulations
promulgated thereunder.
Private Certificates: As specified in the Preliminary
Statement.
Prospectus Supplement: The Prospectus Supplement, dated February
16,
2005, relating to the Offered
Certificates.
PTCE 95-60: As defined in Section 5.02(b).
PUD: A planned unit development.
Purchase
Agreement: The Flow Mortgage Loan Purchase and Warranties
Agreement, dated as of August 25, 2004,
between the Purchaser and the
Responsible Party.
Purchaser: Goldman Sachs Mortgage Company, a New York limited
partnership, and its successors in
interest, as purchaser of the Mortgage Loans
under the Purchase Agreement.
Rating Agency: Each of the Rating Agencies specified in the
Preliminary Statement. If such organization
or a successor is no longer in
existence, "Rating Agency" shall be such
nationally recognized statistical
rating organization, or other comparable
Person, as is designated by the
Depositor, notice of which designation
shall be given to the Trustee. References
herein to a given rating or rating category
of a Rating Agency shall mean such
rating category without giving effect to
any modifiers. For purposes of Section
10.05(b), the addresses for notices to each
Rating Agency shall be the address
specified therefor in the definition
corresponding to the name of such Rating
Agency, or such other address as either
such Rating Agency may hereafter furnish
to the Depositor and the Servicer.
Realized Losses: With respect to any date of determination and
any
Liquidated Mortgage Loan, the amount, if
any, by which (a) the unpaid principal
balance of such Liquidated Mortgage Loan
together with accrued and unpaid
interest thereon exceeds (b) the
Liquidation Proceeds with respect thereto net
of the expenses incurred by the Servicer in
connection with the liquidation of
such Liquidated Mortgage Loan and net of
any amount of unreimbursed Servicing
Advances with respect to such Liquidated
Mortgage Loan.
Record Date: With respect to any Distribution Date, the close
of
business on the last Business Day of the
related Interest Accrual Period;
provided, however, that for any Certificate
issued in definitive form, the
Record Date shall be the close of business
on the last Business Day of the month
preceding the month in which such
applicable Distribution Date occurs.
Reference Bank: As defined in Section 4.04.
Regular Certificates: As specified in the Preliminary
Statement.
Relief Act Interest Shortfall: With respect to any Distribution
Date
and any Mortgage Loan, any reduction in the
amount of interest collectible on
such Mortgage Loan for the most recently
ended Due Period as a result of the
application of the Servicemembers Civil
Relief Act or any similar state
statutes.
REMIC: A "real estate mortgage investment conduit" within the
meaning of Section 860D of the Code.
REMIC Provisions: Provisions of the federal income tax law
relating
to real estate mortgage investment
conduits, which appear at Sections 860A
through 860G of Subchapter M of Chapter 1
of the Code, and related provisions,
and regulations promulgated thereunder, as
the foregoing may be in effect from
time to time as well as provisions of
applicable state laws.
Remittance Date: With respect to any Distribution Date, no
later
than 12:30 PM, Central Time on the Business
Day immediately preceding such
Distribution Date.
REO Disposition: The final sale by the Servicer of any REO
Property.
REO Imputed Interest: As to any REO Property, for any period,
an
amount equivalent to interest (at the
Mortgage Interest Rate net of the
Servicing Fee Rate that would have been
applicable to the related Mortgage Loan
had it been outstanding) on the unpaid
principal balance of the Mortgage Loan as
of the date of acquisition thereof (as such
balance is reduced pursuant to
Section 3.15 by any income from the REO
Property treated as a recovery of
principal).
REO Property: A Mortgaged Property acquired by the Trust Fund
through foreclosure or deed-in-lieu of
foreclosure in connection with a
defaulted Mortgage Loan.
Reporting Date: The 18th day of each calendar month or the
immediately following Business Day if the
18th is not a Business Day.
Repurchase Price: With respect to any Mortgage Loan, an amount
equal
to the sum of (i) the unpaid principal
balance of such Mortgage Loan as of the
date of repurchase, (ii) interest on such
unpaid principal balance of such
Mortgage Loan at the Mortgage Interest Rate
from the last date through which
interest has been paid and distributed to
the Trustee to the date of repurchase,
(iii) all unreimbursed Servicing Advances,
(iv) all expenses incurred by the
Servicer, the Trust or the Trustee, as the
case may be, in respect of a breach
or defect, including, without limitation,
expenses arising out of the Servicer's
or Trustee's, as the case may be,
enforcement of the Responsible Party's
repurchase obligation, to the extent not
included in clause (iii), and (v) any
costs and damages incurred by the Trust in
connection with any violation by such
Mortgage Loan of any predatory lending law
or abusive lending law.
Request for Release: The Request for Release submitted by the
Servicer to the Trustee, substantially in
the form of Exhibit K.
Residual
Certificates: As specified in the Preliminary Statement.
Responsible Officer: When used with respect to the Trustee, any
vice
president, any assistant vice president,
any assistant secretary, any assistant
treasurer, any associate or any other
officer of the Trustee customarily
performing functions similar to those
performed by any of the above designated
officers who at such time shall be officers
to whom, with respect to a
particular matter, such matter is referred
because of such officer's knowledge
of and familiarity with the particular
subject and who shall have direct
responsibility for the administration of
this Agreement.
Responsible Party: NC Capital Corporation, a California
corporation,
and its successors in interest.
Review Appraisal Value: As defined in the Underwriting
Guidelines.
Rule 144A Letter: As defined in Section 5.02(b).
Scheduled Payment: The scheduled monthly payment on a Mortgage
Loan
due on any Due Date allocable to principal
and/or interest on such Mortgage Loan
which, unless otherwise specified herein,
shall give effect to any related Debt
Service Reduction and any Deficient
Valuation that affects the amount of the
monthly payment due on such Mortgage
Loan.
Second Lien Mortgage Loan: A Mortgage Loan secured by a second
lien
Mortgage on the related Mortgaged
Property.
Securities Act: The Securities Act of 1933, as amended.
Senior Enhancement Percentage: With respect to any Distribution
Date, the percentage obtained by dividing
(x) the sum of (i) the aggregate Class
Certificate Balance of the Subordinated
Certificates and (ii) the
Overcollateralized Amount (in each case
after taking into account the
distributions of the Principal Distribution
Amount for such Distribution Date)
by (y) the aggregate Stated Principal
Balance of the Mortgage Loans for such
Distribution Date.
Senior Specified Enhancement Percentage: As of any date of
determination, 44.80%.
Servicer:
When the term "Servicer" is used in this Agreement prior
to the Servicing Transfer Date, New
Century, and on and after the Servicing
Transfer Date, Litton, unless the context
otherwise requires.
Servicer Remittance Report: As defined in Section 4.03(d).
Servicer's Assignee: As defined in Section 10.07.
Servicing Advances: The reasonable "out-of-pocket" costs and
expenses (including legal fees) incurred by
the Servicer in the performance of
its servicing obligations in connection
with a default, delinquency or other
unanticipated event, including, but not
limited to, the cost of (i) the
preservation, restoration, inspection and
protection of a Mortgaged Property,
(ii) any enforcement or judicial
proceedings, including foreclosures and
litigation, in respect of a particular
Mortgage Loan, (iii) the management
(including reasonable fees in connection
therewith) and liquidation of any REO
Property and (iv) the performance of its
obligations under Sections 3.01, 3.09,
3.13 and 3.15. The Servicer shall not be
required to make any Nonrecoverable
Servicing Advances.
Servicing Fee: With respect to each Mortgage Loan and any
Distribution Date, an amount equal to the
product of (i) one-twelfth of the
Servicing Fee Rate, and (ii) the Stated
Principal Balance of such Mortgage Loan
as of the first day of the calendar month
preceding the month in which such
Distribution Date occurs. Such fee shall be
payable monthly, and shall be pro
rated for any portion of a month during
which the Mortgage Loan is serviced by
the Servicer under this Agreement. The
Servicing Fee is payable solely from the
interest portion (including recoveries with
respect to interest from Liquidation
Proceeds, Insurance Proceeds, Condemnation
Proceeds and proceeds received with
respect to REO Properties, to the extent
permitted by Section 3.11) of such
Scheduled Payment collected by the Servicer
or as otherwise provided under
Section 3.11.
Servicing Fee Rate: With respect to each Mortgage Loan, 0.50%
per
annum. Servicing File: With respect to each
Mortgage Loan, the file retained by
the Servicer consisting of originals or
copies of all documents in the Mortgage
File which are not delivered to the Trustee
in the Custodial File and copies of
the Mortgage Loan Documents set forth in
Exhibit L hereto.
Servicing Officer: Any officer of the Servicer involved in, or
responsible for, the administration and
servicing of the Mortgage Loans whose
name and facsimile signature appear on a
list of servicing officers furnished to
the Trustee by the Servicer on the Closing
Date pursuant to this Agreement, as
such list may from time to time be
amended.
Servicing Rights: Any and all of the following: (a) all rights
and
obligations to service the Mortgage Loans;
(b) any compensation for servicing
the Mortgage Loans; (c) any late fees,
penalties or similar payments with
respect to the Mortgage Loans (other than
prepayment penalties); (d) all
agreements or documents creating, defining
or evidencing any such servicing
rights to the extent they relate to such
servicing rights; (e) any interest on
Escrow Accounts allowed by law or other
similar payments with respect to the
Mortgage Loans and any amounts actually
collected with respect thereto; (f) all
accounts and other rights to payment
related to any of the property described in
this paragraph; (g) the right to possess
and use any and all servicing files,
servicing records, data tapes, computer
records, or other information pertaining
to the Mortgage Loans to the extent
relating to the past, present or prospective
servicing of the Mortgage Loans; and (h)
all rights, powers and privileges
incident to any of the foregoing.
Servicing Rights Pledgee: One or more lenders, selected by the
Servicer, to which the Servicer may pledge
and assign all of its right, title
and interest in, to and under this
Agreement pursuant to and as provided in
Section 6.06, including Wachovia Bank,
National Association as the
representative of certain lenders.
Servicing Transfer Date: With respect to any Mortgage Loan, April
1,
2005, or such other date as to which
servicing of such Mortgage Loan transfers
to Litton.
Similar Law: As defined in Section 5.02(b).
60+ Day Delinquent Mortgage Loan: Each Mortgage Loan with respect
to
which any portion of a Scheduled Payment
is, as of the last day of the prior Due
Period, two months or more past due
(without giving effect to any grace period).
Specified Overcollateralized Amount: Prior to the Stepdown Date,
an
amount equal to 3.00% of the Cut-off Date
Pool Principal Balance. On and after
the Stepdown Date, an amount equal to 6.00%
of the aggregate Stated Principal
Balance of the Mortgage Loans for such
Distribution Date, subject, until the
Class Certificate Balance of each Class of
LIBOR Certificates has been reduced
to zero, to a minimum amount equal to the
Overcollateralization Floor; provided,
however, that if, on any Distribution Date,
a Trigger Event has occurred, the
Specified Overcollateralized Amount shall
not be reduced to the applicable
percentage of the then current aggregate
Stated Principal Balance of the
Mortgage Loans until the Distribution Date
on which a Trigger Event is no longer
occurring. When the Class Certificate
Balance of each Class of LIBOR
Certificates has been reduced to zero, the
Specified Overcollateralized Amount
will thereafter equal zero.
SPV: As defined in Section 10.07.
Standard & Poor's: Standard & Poor's Ratings Services, a
division of
The McGraw-Hill Companies, Inc., and its
successors in interest. If Standard &
Poor's is designated as a Rating Agency in
the Preliminary Statement, for
purposes of Section 10.05(b) the address
for notices to Standard & Poor's shall
be Standard & Poor's, 55 Water Street,
New York, New York 10041, Attention:
Residential Mortgage Surveillance Group -
GSAMP Trust 2005-NC1, or such other
address as Standard & Poor's may
hereafter furnish to the Depositor, the
Servicer and the Trustee.
Standard & Poor's Glossary: Version 5.6 of the Standard &
Poor's
LEVELS(R) Glossary.
Start-up Day: As defined in Section 2.06.
Stated Principal Balance: As to each Mortgage Loan and as of
any
date of determination, (i) the principal
balance of the Mortgage Loan at the
Cut-off Date after giving effect to
payments of principal due on or before such
date, minus (ii) all amounts previously
remitted to the Trustee with respect to
the related Mortgage Loan representing
payments or recoveries of principal
including advances in respect of scheduled
payments of principal, and plus (iii)
any amounts added to the unpaid principal
balance of such Mortgage Loan in
connection with a modification thereof. For
purposes of any Distribution Date,
the Stated Principal Balance of any
Mortgage Loan will give effect to any
scheduled payments of principal received by
the Servicer on or prior to the
related Determination Date or advanced by
the Servicer for the related
Remittance Date and any unscheduled
principal payments and other unscheduled
principal collections received during the
related Prepayment Period, and the
Stated Principal Balance of any Mortgage
Loan that has prepaid in full or has
become a Liquidated Mortgage Loan during
the related Prepayment Period shall be
zero.
Stepdown Date: The earlier to occur of (a) the date on which
the
aggregate Class Certificate Balances of the
Class A Certificates have been
reduced to zero, and (b) the later to occur
of (i) the Distribution Date in
March 2008, and (ii) the first Distribution
Date on which the Senior Enhancement
Percentage is greater than or equal to the
Senior Specified Enhancement
Percentage.
Subordinated Certificates: As specified in the Preliminary
Statement.
Subsequent Recoveries: Amounts received with respect to any
Liquidated Mortgage Loan after it has
become a Liquidated Mortgage Loan.
Subservicer: As defined in Section 3.02(a).
Subservicing Account: As defined in Section 3.08.
Subservicing Agreements: As defined in Section 3.02(a).
Substitute Mortgage Loan: A Mortgage Loan substituted by the
Responsible Party for a Deleted Mortgage
Loan which must, on the date of such
substitution, as confirmed in a Request for
Release, substantially in the form
of Exhibit K, (i) have a Stated Principal
Balance, after deduction of the
principal portion of the Scheduled Payment
due in the month of substitution, not
in excess of, and not more than 10% less
than, the Stated Principal Balance of
the Deleted Mortgage Loan; (ii) be accruing
interest at a rate no lower than and
not more than 1% per annum higher than,
that of the Deleted Mortgage Loan; (iii)
have a Loan-to-Value Ratio no higher than
that of the Deleted Mortgage Loan;
(iv) have a remaining term to maturity no
greater than (and not more than one
year less than that of) the Deleted
Mortgage Loan; and (v) comply with each
representation and warranty set forth in
Section 2.03.
Substitution Adjustment Amount: The meaning ascribed to such
term
pursuant to Section 2.03(g).
Tax Service Contract: As defined in Section 3.09(a).
Telerate Page 3750: The display page currently so designated on
the
Bridge Telerate Service (or such other page
as may replace that page on that
service for displaying comparable rates or
prices).
Termination Price: As defined in Section 9.01.
Total Monthly Excess Spread: As to any Distribution Date, an
amount
equal to the excess if any, of (i) the
interest collected on the Mortgage Loans
received by the Servicer on or prior to the
related Determination Date or
advanced by the Servicer for the related
Remittance Date (net of Expense Fees)
over (ii) the sum of the interest payable
to the Classes of LIBOR Certificates
on such Distribution Date pursuant to
Section 4.02(a)(i).
Transfer: Any direct or indirect transfer or sale of any
Ownership
Interest in a Residual Certificate.
Transfer Affidavit: As defined in Section 5.02(c).
Transferor Certificate: As defined in Section 5.02(b).
Trigger Event: With respect to any Distribution Date, a Trigger
Event exists if (i) the quotient (expressed
as a percentage) of (1) the rolling
three month average of the aggregate unpaid
principal balance of 60+ Day
Delinquent Mortgage Loans, divided by (2)
the aggregate unpaid principal balance
of the Mortgage Loans as of the last day of
the related Due Period, equals or
exceeds 35.00% of the Senior Enhancement
Percentage as of the last day of the
prior Due Period or (ii) the quotient
(expressed as a percentage) of (x) the
aggregate amount of Realized Losses
incurred since the Cut-off Date through the
last day of the related Prepayment Period
divided by (y) the Cut-off Date Pool
Principal Balance, exceeds the applicable
percentages set forth below with
respect to such Distribution Date:
--------------------------------------------------------------------------
Distribution Date Occurring In
Loss Percentage
--------------------------------------------------------------------------
March 2008
through February 2009 3.000% for the
first month, plus
an
additional
1/12th of 1.750% for
each month
thereafter
(e.g.,
approximately 3.146% in April 2008)
--------------------------------------------------------------------------
March 2009
through February 2010 4.750% for the
first month, plus
an
additional
1/12th of 1.500% for
each month
thereafter
(e.g.,
approximately 4.875% in April 2009)
--------------------------------------------------------------------------
March 2010
through February 2011 6.250% for the
first month, plus
an
additional
1/12th of 0.500% for
each month
thereafter
(e.g.,
approximately 6.292% in April 2010)
--------------------------------------------------------------------------
March 2011
and thereafter
6.750%
--------------------------------------------------------------------------
Trust: The express trust created hereunder in Section 2.01(c).
Trust
Fund: The corpus of the trust created hereunder consisting of
(i) the Mortgage Loans and all interest and
principal and other payments thereon
and proceeds thereof received on or with
respect thereto after the related
Cut-off Date, other than such amounts which
were due on the Mortgage Loans on or
before the related Cut-off Date; (ii) the
Collection Account, Excess Reserve
Fund Account, the Distribution Account, and
all amounts deposited therein
pursuant to the applicable provisions of
this Agreement; (iii) property that
secured a Mortgage Loan and has been
acquired by foreclosure, deed-in-lieu of
foreclosure or otherwise; and (iv) all
proceeds of the conversion, voluntary or
involuntary, of any of the foregoing.
Trust REMIC: Any of the Lower Tier REMIC, the Upper Tier REMIC,
the
Class B-2 REMIC, the Class B-3 REMIC, the
Class B-4 REMIC and the Class X REMIC.
Trustee: Deutsche Bank National Trust Company and its
successors
and, if a successor trustee is appointed
hereunder, such successor.
Trustee Fee: As to each Mortgage Loan and any Distribution Date,
an
amount equal to one month's interest at the
related Trustee Fee Rate on the
Stated Principal Balance of such Mortgage
Loan as of the preceding Distribution
Date (or as of the Closing Date in the case
of the first Distribution Date) or,
in the event of any payment of interest
which accompanies a Principal Prepayment
in Full made by the Mortgagor, interest at
the Trustee Fee Rate on the Stated
Principal Balance of such Mortgage Loan for
the period covered by such payment
of interest.
Trustee Fee Rate: With respect to each Mortgage Loan, 0.01% per
annum.
Underwriters' Exemption: Any exemption listed in footnote 1 of,
and
amended by, Prohibited Transaction
Exemption 2002-41, 67 Fed. Reg. 54487 (2002),
or any successor exemption.
Underwriting Guidelines: The underwriting guidelines attached to
the
Purchase Agreement.
Unpaid Interest Amount: As of any Distribution Date and any Class
of
Certificates, the sum of (a) the portion of
the Accrued Certificate Interest
Distribution Amount from Distribution Dates
prior to the current Distribution
Date remaining unpaid immediately prior to
the current Distribution Date and (b)
interest on the amount in clause (a) above
at the applicable Pass-Through Rate
(to the extent permitted by applicable
law).
Upper Tier Regular Interest: As described in the Preliminary
Statement.
Upper Tier REMIC: As described in the Preliminary Statement.
U.S. Person: (i) A citizen or resident of the United States; (ii)
a
corporation (or entity treated as a
corporation for tax purposes) created or
organized in the United States or under the
laws of the United States or of any
State thereof, including, for this purpose,
the District of Columbia; (iii) a
partnership (or entity treated as a
partnership for tax purposes) organized in
the United States or under the laws of the
United States or of any state
thereof, including, for this purpose, the
District of Columbia (unless provided
otherwise by future Treasury regulations);
(iv) an estate whose income is
includible in gross income for United
States income tax purposes regardless of
its source; or (v) a trust, if a court
within the United States is able to
exercise primary supervision over the
administration of the trust and one or
more U.S. Persons have authority to control
all substantial decisions of the
trust. Notwithstanding the last clause of
the preceding sentence, to the extent
provided in Treasury regulations, certain
trusts in existence on August 20,
1996, and treated as U.S. Persons prior to
such date, may elect to continue to
be U.S. Persons.
Voting Rights: The portion of the voting rights of all of the
Certificates which is allocated to any
Certificate. As of any date of
determination, (a) 1% of all Voting Rights
shall be allocated to the Class N
Certificates, if any (such Voting Rights to
be allocated among the holders of
Certificates of each such Class in
accordance with their respective Percentage
Interests), (b) 1% of all Voting Rights
shall be allocated to the Class X
Certificates, if any, and (c) the remaining
Voting Rights shall be allocated
among Holders of the remaining Classes of
Certificates in proportion to the
Certificate Balances of their respective
Certificates on such date; provided,
however, on and after the date on which the
Class N Notional Amount Certificates
is reduced to zero, the percentage of all
the Voting Rights allocated among the
Holders of the Class N Certificates shall
be 0% and the percentage of all the
Voting Rights allocated among the Holder of
the Class X Certificates shall be
2%.
WAC Cap: With respect to the Mortgage Loans as of any
Distribution
Date, the product of (i) the weighted
average of the Adjusted Net Mortgage
Interest Rates then in effect on the
beginning of the related Due Period on the
Mortgage Loans, and (ii) a fraction, the
numerator of which is 30 and the
denominator of which is the actual number
of days in the Interest Accrual Period
related to such Distribution Date.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
Section 2.01 Conveyance of Mortgage Loans. (a) The Depositor,
concurrently with the execution and
delivery hereof, hereby sells, transfers,
assigns, sets over and otherwise conveys to
the Trustee for the benefit of the
Certificateholders, without recourse, all
the right, title and interest of the
Depositor in and to the Trust Fund and the
Trustee, on behalf of the Trust,
hereby accepts the Trust Fund.
(b) In connection with the transfer and assignment of each
Mortgage
Loan, the Depositor has delivered or caused
to be delivered to the Trustee for
the benefit of the Certificateholders the
following documents or instruments
with respect to each Mortgage Loan so
assigned:
(i) the original Mortgage Note (except for up to 0.21% of the
Mortgage
Notes for which there is a lost note affidavit and a copy of
the
Mortgage
Note) bearing all intervening endorsements, endorsed "Pay to
the
order of
_________, without recourse" and signed in the name of the last
endorsee.
To the extent that there is no room on the face of the Mortgage
Notes for
endorsements, the endorsement may be contained on an allonge
unless the
Trustee is advised by the Responsible Party that state law does
not so
allow. If the Mortgage Loan was acquired by the Responsible
Party
in a
merger, the endorsement must be by "[last endorsee], successor
by
merger to
[name of predecessor]". If the Mortgage Loan was acquired or
originated
by the last endorsee while doing business under another name,
the
endorsement must be by "[last endorsee], formerly known as
[previous
name]";
(ii) the original of any guarantee executed in connection with
the
Mortgage
Note;
(iii) the original Mortgage with evidence of recording thereon or
a
certified
true copy of such Mortgage submitted for recording. If in
connection
with any Mortgage Loan, the Responsible Party cannot deliver or
cause to
be delivered the original Mortgage with evidence of recording
thereon on
or prior to the Closing Date because of a delay caused by the
public
recording office where such Mortgage has been delivered for
recordation or because such Mortgage has been lost or because such
public
recording
office retains the original recorded Mortgage, the Responsible
Party
shall deliver or cause to be delivered to the Trustee, a
photocopy
of such
Mortgage, together with (A) in the case of a delay caused by
the
public
recording office, an Officer's Certificate of the Responsible
Party
(or
certified by the title company, escrow agent, or closing
attorney)
stating
that such Mortgage has been dispatched to the appropriate
public
recording
office for recordation and that the original recorded Mortgage
or a copy
of such Mortgage certified by such public recording office to
be
a true and
complete copy of the original recorded Mortgage will be
promptly
delivered to the Trustee upon receipt thereof by the
Responsible
Party; or
(B) in the case of a Mortgage where a public recording office
retains
the original recorded Mortgage or in the case where a Mortgage
is
lost after
recordation in a public recording office, a copy of such
Mortgage
certified by such public recording office to be a true and
complete
copy of the original recorded Mortgage;
(iv) the originals of all assumption, modification, consolidation
or
extension
agreements, if any, with evidence of recording thereon or a
certified
true copy of such agreement submitted for recording;
(v) the original Assignment of Mortgage for each Mortgage Loan
endorsed
in blank and in recordable form;
(vi) the originals of all intervening assignments of mortgage
(if
any)
evidencing a complete chain of assignment from the originator to
the
last
endorsee with evidence of recording thereon, or if any such
intervening assignment has not been returned from the applicable
recording
office or
has been lost or if such public recording office retains the
original
recorded assignments of mortgage, the Responsible Party shall
deliver or
cause to be delivered to the Trustee, a photocopy of such
intervening assignment, together with (A) in the case of a delay
caused by
the public
recording office, an Officer's Certificate of the Responsible
Party (or
certified by the title company, escrow agent, or closing
attorney)
stating that such intervening assignment of mortgage has been
dispatched
to the appropriate public recording office for recordation and
that such
original recorded intervening assignment of mortgage or a copy
of such
intervening assignment of mortgage certified by the appropriate
public
recording office to be a true and complete copy of the original
recorded
intervening assignment of mortgage will be promptly delivered
to
the
Trustee upon receipt thereof by the Responsible Party; or (B) in
the
case of an
intervening assignment where a public recording office retains
the
original recorded intervening assignment or in the case where
an
intervening assignment is lost after recordation in a public
recording
office, a
copy of such intervening assignment certified by such public
recording
office to be a true and complete copy of the original recorded
intervening assignment;
(vii) the original mortgagee policy of title insurance or, in
the
event such
original title policy is unavailable, a certified true copy of
the
related policy binder or commitment for title certified to be true
and
complete
by the title insurance company; and
(viii) a security agreement, chattel mortgage or equivalent
document
executed
in connection with the Mortgage (if provided).
Each Mortgage Loan for which a Mortgage Note is missing shall
be
evidenced by a lost note affidavit as of
the Closing Date. In the event, for
purposes of the Closing Date, one or more
lost note affidavits are provided to
cover multiple missing Mortgage Notes, the
Responsible Party shall deliver to
the Trustee the applicable individual lost
note affidavits within ten (10)
Business Days of the Closing Date. If the
Responsible Party fails to deliver the
required individual lost note affidavits
within the specified period of time,
the Trustee shall notify the Responsible
Party to take such remedial actions,
including, without limitation, the
repurchase by the Responsible Party of such
Mortgage Loan within 30 days of the Closing
Date.
The Responsible Party shall deliver to the Trustee the
applicable
recorded document promptly upon receipt
from the respective recording office but
in no event later than 120 days from the
Closing Date.
From time to time, the Responsible Party shall forward, with
respect
to the Mortgage Loans, to the Trustee
additional original documents, and
additional documents evidencing an
assumption, modification, consolidation or
extension of a Mortgage Loan approved by
the Responsible Party, in accordance
with the terms of this Agreement. All such
mortgage documents held by the
Trustee as to each Mortgage Loan shall
constitute the "Custodial File."
On or prior to the Closing Date, the Responsible Party shall
deliver
to the Trustee Assignments of Mortgages, in
blank, for each Mortgage Loan. The
Responsible Party shall cause the
Assignments of Mortgage with completed
recording information to be provided to the
Servicer in a reasonably acceptable
manner. No later than thirty (30) Business
Days following the later of the
Closing Date and the date of receipt by the
Servicer of the fully completed
Assignments of Mortgages in recordable
form, the Servicer shall promptly submit
or cause to be submitted for recording, at
the expense of the Responsible Party
or the Depositor, at no expense to the
Trust Fund, the Servicer or the Trustee
in the appropriate public office for real
property records, each Assignment of
Mortgage referred to in Section 2.01(b)(v).
The Mortgage shall be assigned by
the Responsible Party at the Responsible
Party's or the Depositor's expense to
"Deutsche Bank National Trust Company as
trustee under the Pooling and Servicing
Agreement dated as of February 1, 2005,
GSAMP Trust 2005-NC1." In the event that
any such assignment is lost or returned
unrecorded because of a defect therein,
the Responsible Party shall promptly
prepare a substitute assignment to cure
such defect and thereafter cause each such
assignment to be duly recorded at the
expense of the Responsible Party or the
Depositor.
On or prior to the Closing Date, the Depositor shall deliver to
the
Trustee a copy of the Data Tape Information
in electronic, machine readable
medium in a form mutually acceptable to the
Depositor and the Trustee. Within
ten (10) Business Days of the Closing Date,
the Depositor shall deliver a copy
of the complete Mortgage Loan Schedule to
the Trustee and the Servicer.
In the event that such original or copy of any document
submitted
for recordation to the appropriate public
recording office is not so delivered
to the Trustee within 90 days following the
Closing Date, and in the event that
the Responsible Party does not cure such
failure within 30 days of discovery or
receipt of written notification of such
failure from the Depositor, the related
Mortgage Loan shall, upon the request of
the Depositor, be repurchased by the
Responsible Party at the price and in the
manner specified in Section 2.03. The
foregoing repurchase obligation shall not
apply in the event that the
Responsible Party cannot deliver such
original or copy of any document submitted
for recordation to the appropriate public
recording office within the specified
period due to a delay caused by the
recording office in the applicable
jurisdiction; provided, that the
Responsible Party shall instead deliver a
recording receipt of such recording office
or, if such recording receipt is not
available, an officer's certificate of an
officer of the Responsible Party
confirming that such document has been
accepted for recording.
Notwithstanding anything to the contrary contained in this
Section
2.01, in those instances where the public
recording office retains or loses the
original Mortgage or assignment after it
has been recorded, the obligations of
the Responsible Party shall be deemed to
have been satisfied upon delivery by
the Responsible Party to the Trustee prior
to the Closing Date of a copy of such
Mortgage or assignment, as the case may be,
certified (such certification to be
an original thereof) by the public
recording office to be a true and complete
copy of the recorded original thereof.
(c) The Depositor does hereby establish, pursuant to the
further
provisions of this Agreement and the laws
of the State of New York, an express
trust (the "Trust") to be known, for
convenience, as "GSAMP Trust 2005-NC1" and
Deutsche Bank National Trust Company is
hereby appointed as Trustee in
accordance with the provisions of this
Agreement. The parties hereto acknowledge
and agree that it is the policy and
intention of the Trust to acquire only
Mortgage Loans meeting the requirements set
forth in this Agreement, including
without limitation, the representations and
warranties set forth in paragraph
(47) of Schedule IV to this Agreement.
(d) The Trust shall have the capacity, power and authority, and
the
Trustee on behalf of the Trust is hereby
authorized, to accept the sale,
transfer, assignment, set over and
conveyance by the Depositor to the Trust of
all the right, title and interest of the
Depositor in and to the Trust Fund
(including, without limitation, the
Mortgage Loans) pursuant to Section 2.01(a).
Section 2.02 Acceptance by the Trustee of the Mortgage Loans.
The
Trustee acknowledges receipt of the
documents identified in the Initial
Certification in the form annexed hereto as
Exhibit E, and declares that it
holds and will hold such documents and the
other documents delivered to it
pursuant to Section 2.01, and that it holds
or will hold such other assets as
are included in the Trust Fund, in trust
for the exclusive use and benefit of
all present and future Certificateholders.
The Trustee acknowledges that it will
maintain possession of the related Mortgage
Notes in the State of California,
unless otherwise permitted by the Rating
Agencies.
Prior to and as a condition to the Closing, the Trustee shall
deliver via facsimile (with original to
follow the next Business Day) to the
Depositor, Litton and New Century an
Initial Certification prior to the Closing
Date, or as the Depositor agrees to, on the
Closing Date, certifying receipt of
a Mortgage Note and Assignment of Mortgage
for each Mortgage Loan with any
exceptions thereon. The Trustee shall not
be responsible to verify the validity,
sufficiency or genuineness of any document
in any Custodial File.
On the Closing Date, the Trustee shall ascertain that all
documents
required to be reviewed by it are in its
possession, and shall deliver to the
Depositor, Litton and New Century an
Initial Certification, in the form annexed
hereto as Exhibit E, and shall deliver to
the Depositor, Litton and New Century
a Document Certification and Exception
Report, in the form annexed hereto as
Exhibit F, within 90 days after the Closing
Date to the effect that, as to each
Mortgage Loan listed in the Mortgage Loan
Schedule (other than any Mortgage Loan
paid in full or any Mortgage Loan
specifically identified in such certification
as an exception and not covered by such
certification): (i) all documents
required to be reviewed by it are in its
possession; (ii) such documents have
been reviewed by it and appear regular on
their face and relate to such Mortgage
Loan; (iii) based on its examination and
only as to the foregoing documents, the
information set forth in items (1), (2) and
(13) of the Mortgage Loan Schedule
and items (1), (2) and (13) of the Data
Tape Information respecting such
Mortgage Loan is correct; and (iv) each
Mortgage Note has been endorsed as
provided in Section 2.01 of this Agreement.
The Trustee shall not be responsible
to verify the validity, sufficiency or
genuineness of any document in any
Custodial File.
The Trustee shall retain possession and custody of each
Custodial
File in accordance with and subject to the
terms and conditions set forth
herein. The Servicer shall promptly deliver
to the Trustee, upon the execution
or receipt thereof, the originals of such
other documents or instruments
constituting the Custodial File as come
into the possession of the Servicer from
time to time.
Section 2.03 Representations, Warranties and Covenants of the
Responsible Party and the Servicer. (a)
Litton and New Century, severally and
not jointly, hereby make the
representations and warranties set forth in
Schedule II and Schedule III hereto,
respectively, to the Depositor and the
Trustee as of the Closing Date.
(b) The Responsible Party hereby makes the representations and
warranties set forth in Schedule IV and
Schedule V hereto, to the Depositor,
Litton, New Century and the Trustee.
(c) It is understood and agreed by Litton, New Century and the
Responsible Party that the representations
and warranties set forth in this
Section 2.03 shall survive the transfer of
the Mortgage Loans by the Depositor
to the Trustee, and shall inure to the
benefit of the Depositor and the Trustee
notwithstanding any restrictive or
qualified endorsement on any Mortgage Note or
Assignment of Mortgage or the examination
or failure to examine any Mortgage
File. Upon discovery by any of the
Responsible Party, the Depositor, the
Trustee, Litton or New Century of a breach
of any of the foregoing
representations and warranties, the party
discovering such breach shall give
prompt written notice to the others.
(d) Within 30 days of the earlier of either discovery by or
notice
to the Responsible Party that any Mortgage
Loan does not conform to the
requirements as determined in the Trustee's
review of the related Custodial File
or within 60 days of the earlier of either
discovery by or notice to the
Responsible Party of any breach of a
representation or warranty set forth in
Section 2.03(b) that materially and
adversely affects the value of any Mortgage
Loan or the interest of the Trustee or the
Certificateholders therein, the
Responsible Party shall use its best
efforts to cause to be remedied a material
defect in a document constituting part of a
Mortgage File or promptly to cure
such breach in all material respects and,
if such defect or breach cannot be
remedied, the Responsible Party shall, (i)
if such 30 or 60 day period, as
applicable, expires prior to the second
anniversary of the Closing Date, remove
such Mortgage Loan (a "Deleted Mortgage
Loan") from the Trust Fund and
substitute in its place a Substitute
Mortgage Loan, in the manner and subject to
the conditions set forth in this Section
2.03, or (ii) at the Depositor's
option, repurchase such Mortgage Loan at
the Repurchase Price; provided,
however, that any such substitution
pursuant to clause (i) above shall not be
effected prior to the delivery to the
Trustee of the Opinion of Counsel required
by Section 2.04, if any, and a Request for
Release substantially in the form of
Exhibit K, and the Mortgage File for any
such Substitute Mortgage Loan. In the
event that a breach shall involve any
representation or warranty set forth in
Schedule IV, and such breach cannot be
cured within 60 days of the earlier of
either discovery by or notice to the
Responsible Party of such breach, all of
the Mortgage Loans shall, at the
Depositor's option, be repurchased by the
Responsible Party at the Repurchase Price.
Notwithstanding the foregoing, a
breach (x) which causes a Mortgage Loan not
to constitute a "qualified mortgage"
within the meaning of Section 860G(a)(3) of
the Code or (y) by the Responsible
Party of any of the representations and
warranties set forth in paragraphs (44),
(47), (48), (50), (58), (59), (60), (61),
(62), (63), (64), (65), (66) or (67)
of Schedule IV, in each case, will be
deemed automatically to materially and
adversely affect the value of such Mortgage
Loan and the interests of the
Trustee and Certificateholders in such
Mortgage Loan. In the event that the
Trustee receives notice of a breach by the
Responsible Party of any of the
representations and warranties set forth in
paragraphs (44), (47), (48), (50),
(58), (59), (60), (61), (62), (63), (64),
(65), (66) or (67) of Schedule IV, the
Trustee shall give notice of such breach to
the Responsible Party and request
the Responsible Party to repurchase the
Mortgage Loan at the Repurchase Price
within 30 days of the Responsible Party's
receipt of such notice. The
Responsible Party shall repurchase each
such Deleted Mortgage Loan within 30
days of the earlier of discovery or receipt
of notice with respect to each such
Deleted Mortgage Loan.
(e) With respect to any Substitute Mortgage Loan or Loans, the
Responsible Party shall deliver to the
Trustee for the benefit of the
Certificateholders the Mortgage Note, the
Mortgage, the related assignment of
the Mortgage, and such other documents and
agreements as are required by Section
2.01, with the Mortgage Note endorsed and
the Mortgage assigned as required by
Section 2.01. No substitution is permitted
to be made in any calendar month
after the Determination Date for such
month. Scheduled Payments due with respect
to Substitute Mortgage Loans in the Due
Period of substitution shall not be part
of the Trust Fund and will be retained by
the Responsible Party on the next
succeeding Distribution Date. For the Due
Period of substitution, distributions
to Certificateholders will include the
Scheduled Payment due on any Deleted
Mortgage Loan for such Due Period and
thereafter the Responsible Party shall be
entitled to retain all amounts received in
respect of such Deleted Mortgage
Loan.
(f) The Servicer shall, based on information provided by the
Responsible Party, amend the Mortgage Loan
Schedule for the benefit of the
Certificateholders to reflect the removal
of such Deleted Mortgage Loan and the
substitution of the Substitute Mortgage
Loan or Loans and the Servicer shall
deliver the amended Mortgage Loan Schedule
to the Trustee. The Servicer shall
have no liability with respect to the
information provided by the Responsible
Party related to the Substitute Mortgage
Loan. Upon such substitution, the
Substitute Mortgage Loan or Loans shall be
subject to the terms of this
Agreement in all respects, and the
Responsible Party shall be deemed to have
made with respect to such Substitute
Mortgage Loan or Loans, as of the date of
substitution, the representations and
warranties made pursuant to Section
2.03(b) with respect to such Mortgage Loan.
Upon any such substitution and the
deposit to the Collection Account of the
amount required to be deposited therein
in connection with such substitution as
described in the following paragraph,
the Trustee shall release the Mortgage File
held for the benefit of the
Certificateholders relating to such Deleted
Mortgage Loan to the Responsible
Party and shall execute and deliver at the
Responsible Party's direction such
instruments of transfer or assignment
prepared by the Responsible Party, in each
case without recourse, as shall be
necessary to vest title in the Responsible
Party, or its designee, the Trustee's
interest in any Deleted Mortgage Loan
substituted for pursuant to this Section
2.03.
(g) For any month in which the Responsible Party substitutes one
or
more Substitute Mortgage Loans for one or
more Deleted Mortgage Loans, the
Servicer will determine the amount (if any)
by which the aggregate unpaid
principal balance of all such Substitute
Mortgage Loans as of the date of
substitution is less than the aggregate
Stated Principal Balance of all such
Deleted Mortgage Loans (after application
of the scheduled principal portion of
the Scheduled Payments due in the Due
Period of substitution). The amount of
such shortage (the "Substitution Adjustment
Amount") plus, if the Responsible
Party is not the Servicer, an amount equal
to the aggregate of any unreimbursed
Advances and Servicing Advances with
respect to such Deleted Mortgage Loans
shall be deposited into the Collection
Account by the Responsible Party on or
before the next Remittance Date.
(h) In addition to such repurchase obligation, the Responsible
Party
shall indemnify the Depositor, any of its
Affiliates, the Servicer, and the
Trustee and hold such parties harmless
against any losses, damages, penalties,
fines, forfeitures, reasonable and
necessary legal fees and related costs,
judgments, and other costs and expenses
resulting from any claim, demand,
defense or assertion based on or grounded
upon, or resulting from, a breach by
the Responsible Party of any of its
representations and warranties contained in
the Purchase Agreement or this
Agreement.
(i) In the event that a Mortgage Loan shall have been
repurchased
pursuant to this Agreement, the Repurchase
Price thereof shall be deposited in
the Collection Account by the Servicer
pursuant to Section 3.10 on or before the
next Remittance Date and upon such deposit
of the Repurchase Price and receipt
of a Request for Release in the form of
Exhibit K hereto, the Trustee shall
release the related Custodial File held for
the benefit of the
Certificateholders to such Person as
directed by the Servicer, and the Trustee
shall execute and deliver at such Person's
direction such instruments of
transfer or assignment prepared by such
Person, in each case without recourse,
as shall be necessary to transfer title
from the Trustee. It is understood and
agreed that the obligation under this
Agreement of any Person to cure,
repurchase or replace any Mortgage Loan as
to which a breach has occurred and is
continuing, together with any related
indemnification obligation, shall
constitute the sole remedy against such
Persons respecting such breach available
to Certificateholders, the Depositor, the
Servicer or the Trustee on their
behalf.
The representations and warranties made pursuant to this
Section
2.03 shall survive delivery of the
respective Custodial Files to the Trustee for
the benefit of the Certificateholders.
Section 2.04 Non-Qualified Mortgages. Upon discovery by the
Depositor, the Responsible Party, the
Servicer or the Trustee that any Mortgage
Loan does not constitute a "qualified
mortgage" within the meaning of Section
860G(a)(3) of the Code, the party
discovering such fact shall promptly (and in
any event within five (5) Business Days of
discovery) give written notice
thereof to the other parties. In connection
therewith, the Trustee shall require
the Responsible Party to repurchase the
affected Mortgage Loan within 30 days of
the earlier of discovery or receipt of
notice in the same manner as it would a
Mortgage Loan for a breach of
representation or warranty made pursuant to
Section 2.03. The Trustee shall reconvey to
the Responsible Party the Mortgage
Loan to be released pursuant hereto in the
same manner, and on the same terms
and conditions, as it would a Mortgage Loan
repurchased for breach of a
representation or warranty contained in
Section 2.03.
Section 2.05 Execution and Delivery of Certificates. The
Trustee
acknowledges the transfer and assignment to
it of the Trust Fund and,
concurrently with such transfer and
assignment, has executed and delivered to or
upon the order of the Depositor, the
Certificates in authorized denominations
evidencing directly or indirectly the
entire ownership of the Trust Fund. The
Trustee agrees to hold the Trust Fund and
exercise the rights referred to above
for the benefit of all present and future
Holders of the Certificates.
Section 2.06 REMIC Matters. The Preliminary Statement sets forth
the
designations for federal income tax
purposes of all interests created hereby.
The "Start-up Day" for purposes of the
REMIC Provisions shall be the Closing
Date. The "latest possible maturity date"
is the Distribution Date in February
2035, which is the Distribution Date
following the latest Mortgage Loan maturity
date.
Amounts payable to the Class B-2 Certificates (other than any
Basis
Risk Carry Forward Amounts) shall be deemed
paid from the Upper Tier REMIC in
respect of the Class B-2 Interest to the
Class B-2 REMIC as holder of the Class
B-2 Interest. Amounts payable to the Class
B-3 Certificates (other than any
Basis Risk Carry Forward Amounts) shall be
deemed paid from the Upper Tier REMIC
in respect of the Class B-3 Interest to the
Class B-3 REMIC as holder of the
Class B-3 Interest. Amounts payable to the
Class B-4 Certificates (other than
any Basis Risk Carry Forward Amounts) shall
be deemed paid from the Upper Tier
REMIC in respect of the Class B-4 Interest
to the Class B-4 REMIC as holder of
the Class B-4 Interest. Amounts paid to the
Class N and Class X Certificates
(prior to any reduction for any Basis Risk
Payment) shall be deemed paid (i)
first, from the Upper Tier REMIC in respect
of the Class X Interest to the Class
X REMIC as holder of the Class X Interest
(including Prepayment Premiums) and
(ii) then from the Class X REMIC in respect
of the Class X/N Regular Interest to
the holders of the Class N and Class X
Certificates. If the Class N and Class X
Certificates are held by more than one
person and such Persons do not hold both
the Class N and Class X Certificates
proportionately, payments on the Class X/N
Regular Interest shall be deemed paid to a
partnership, the partners of which
are the Holders of Class N and the Class X
Certificates.
Section 2.07 Representations and Warranties of the Depositor.
The
Depositor hereby represents, warrants and
covenants to the Trustee, Litton, New
Century and the Responsible Party that as
of the date of this Agreement or as of
such date specifically provided herein:
(a) The Depositor is a corporation duly organized, validly
existing
and in good standing under the laws of the
State of Delaware;
(b) The Depositor has the corporate power and authority to
convey
the Mortgage Loans and to execute, deliver
and perform, and to enter into and
consummate the transactions contemplated
by, this Agreement;
(c) This Agreement has been duly and validly authorized,
executed
and delivered by the Depositor, all
requisite corporate action having been
taken, and, assuming the due authorization,
execution and delivery hereof by the
other parties hereto, constitutes or will
constitute the legal, valid and
binding agreement of the Depositor,
enforceable against the Depositor in
accordance with its terms, except as such
enforcement may be limited by
bankruptcy, insolvency, reorganization,
moratorium or other similar laws
relating to or affecting the rights of
creditors generally, and by general
equity principles (regardless of whether
such enforcement is considered in a
proceeding in equity or at law);
(d) No consent, approval, authorization or order of or
registration
or filing with, or notice to, any
governmental authority or court is required
for the execution, delivery and performance
of or compliance by the Depositor
with this Agreement or the consummation by
the Depositor of any of the
transactions contemplated hereby, except as
have been made on or prior to the
Closing Date;
(e) None of the execution and delivery of this Agreement, the
consummation of the transactions
contemplated hereby or thereby, or the
fulfillment of or compliance with the terms
and conditions of this Agreement,
(i) conflicts or will conflict with or
results or will result in a breach of, or
constitutes or will constitute a default or
results or will result in an
acceleration under (A) the charter or
bylaws of the Depositor, or (B) of any
term, condition or provision of any
material indenture, deed of trust, contract
or other agreement or instrument to which
the Depositor or any of its
subsidiaries is a party or by which it or
any of its subsidiaries is bound; (ii)
results or will result in a violation of
any law, rule, regulation, order,
judgment or decree applicable to the
Depositor of any court or governmental
authority having jurisdiction over the
Depositor or its subsidiaries; or (iii)
results in the creation or imposition of
any lien, charge or encumbrance which
would have a material adverse effect upon
the Mortgage Loans or any documents or
instruments evidencing or securing the
Mortgage Loans;
(f) There are no actions, suits or proceedings before or against
or
investigations of, the Depositor pending,
or to the knowledge of the Depositor,
threatened, before any court,
administrative agency or other tribunal, and no
notice of any such action, which, in the
Depositor's reasonable judgment, might
materially and adversely affect the
performance by the Depositor of its
obligations under this Agreement, or the
validity or enforceability of this
Agreement;
(g) The Depositor is not in default with respect to any order
or
decree of any court or any order,
regulation or demand of any federal, state,
municipal or governmental agency that may
materially and adversely affect its
performance hereunder; and
(h) Immediately prior to the transfer and assignment by the
Depositor to the Trustee on the Closing
Date, the Depositor had good title to,
and was the sole owner of each Mortgage
Loan, free of any interest of any other
Person, and the Depositor has transferred
all right, title and interest in each
Mortgage Loan to the Trustee. The transfer
of each Mortgage Note and each
Mortgage as and in the manner contemplated
by this Agreement is sufficient
either (i) fully to transfer to the
Trustee, for the benefit of the
Certificateholders, all right, title, and
interest of the Depositor thereto as
note holder and mortgagee or (ii) to grant
to the Trustee, for the benefit of
the Certificateholders, the security
interest referred to in Section 10.04.
It is understood and agreed that the representations, warranties
and
covenants set forth in this Section 2.07
shall survive delivery of the
respective Custodial Files to the Trustee
or to a custodian, as the case may be,
and shall inure to the benefit of the
Trustee.
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01 Servicer to Service Mortgage Loans. (a) For and on
behalf of the Certificateholders, the
Servicer shall service and administer the
Mortgage Loans in accordance with the terms
of this Agreement and the respective
Mortgage Loans and, to the extent
consistent with such terms, in compliance with
all applicable federal, state and local
laws, and in the same manner in which it
services and administers similar mortgage
loans for its own portfolio, giving
due consideration to customary and usual
standards of practice of mortgage
lenders and loan servicers administering
similar mortgage loans but without
regard to:
(i) any relationship that the Servicer, any Subservicer or any
Affiliate
of the Servicer or any Subservicer may have with the related
Mortgagor;
(ii) the ownership or non-ownership of any Certificate by the
Servicer
or any Affiliate of the Servicer;
(iii) the Servicer's obligation to make P&I Advances or
Servicing
Advances;
or
(iv) the Servicer's or any Subservicer's right to receive
compensation for its services hereunder or with respect to any
particular
transaction.
To the extent consistent with the foregoing, the Servicer shall
seek
to maximize the timely and complete
recovery of principal and interest on the
Mortgage Notes. Subject only to the
above-described servicing standards and the
terms of this Agreement and of the
respective Mortgage Loans, the Servicer shall
have full power and authority, acting alone
or through Subservicers as provided
in Section 3.02, to do or cause to be done
any and all things in connection with
such servicing and administration which it
may deem necessary or desirable.
Without limiting the generality of the
foregoing, the Servicer in its own name
or in the name of a Subservicer is hereby
authorized and empowered by the
Trustee when the Servicer believes it
appropriate in its best judgment in
accordance with the servicing standards set
forth above, to execute and deliver
any and all instruments of satisfaction or
cancellation, or of partial or full
release or discharge, and all other
comparable instruments, with respect to the
Mortgage Loans and the Mortgaged Properties
and to institute foreclosure
proceedings or obtain a deed-in-lieu of
foreclosure so as to convert the
ownership of such properties, and to hold
or cause to be held title to such
properties, on behalf of the Trustee and in
the name of the Trust. The Servicer
shall service and administer the Mortgage
Loans in accordance with applicable
state and federal law and shall provide to
the Mortgagors any reports required
to be provided to them thereby. The
Servicer shall also comply in the
performance of this Agreement with all
reasonable rules and requirements of each
insurer under any standard hazard insurance
policy. Subject to Section 3.16, the
Trustee shall execute, at the written
request of the Servicer, and furnish to
the Servicer and any Subservicer such
documents as are necessary or appropriate
to enable the Servicer or any Subservicer
to carry out their servicing and
administrative duties hereunder, and the
Trustee hereby grants to the Servicer,
and this Agreement shall constitute, a
power of attorney to carry out such
duties including a power of attorney to
take title to Mortgaged Properties after
foreclosure on behalf of the Trustee and in
the name of the Trust. The Trustee
shall execute a separate power of attorney
in the form attached hereto as
Exhibit P in favor of the Servicer for the
purposes described herein to the
extent necessary or desirable to enable the
Servicer to perform its duties
hereunder. The Trustee shall not be liable
for the actions of the Servicer or
any Subservicers under such powers of
attorney.
(b) Subject to Section 3.09(b), in accordance with Accepted
Servicing Practices, the Servicer shall
advance or cause to be advanced funds as
necessary for the purpose of effecting the
timely payment of taxes and
assessments on the Mortgaged Properties,
which advances shall be Servicing
Advances reimbursable in the first instance
from related collections from the
Mortgagors pursuant to Section 3.09(b), and
further as provided in Section 3.11.
Any cost incurred by the Servicer or by
Subservicers in effecting the timely
payment of taxes and assessments on a
Mortgaged Property shall not be added to
the unpaid principal balance of the related
Mortgage Loan, notwithstanding that
the terms of such Mortgage Loan so
permit.
(c) Notwithstanding anything in this Agreement to the contrary,
the
Servicer may not make any future advances
with respect to a Mortgage Loan
(except as provided in Section 4.01) and
the Servicer shall not (i) permit any
modification with respect to any Mortgage
Loan that would change the Mortgage
Interest Rate, reduce or increase the
principal balance (except for reductions
resulting from actual payments of
principal) or change the final maturity date
on such Mortgage Loan (except for (A) a
reduction of interest payments resulting
from the application of the Servicemembers
Civil Relief Act or any similar state
statutes or (B) as provided in Section
3.07(a), if the Mortgagor is in default
with respect to the Mortgage Loan or such
default is, in the judgment of the
Servicer, reasonably foreseeable) or (ii)
permit any modification, waiver or
amendment of any term of any Mortgage Loan
that would both (A) effect an
exchange or reissuance of such Mortgage
Loan under Section 1001 of the Code (or
final, temporary or proposed Treasury
regulations promulgated thereunder) and
(B) cause any Trust REMIC to fail to
qualify as a REMIC under the Code or the
imposition of any tax on "prohibited
transactions" or "contributions after the
start-up day" under the REMIC Provisions,
or (iii) except as provided in Section
3.07(a), waive any Prepayment Premiums.
(d) The Servicer may delegate its responsibilities under this
Agreement; provided, however, that no such
delegation shall release the Servicer
from the responsibilities or liabilities
arising under this Agreement.
Section 3.02 Subservicing Agreements between the Servicer and
Subservicers.
(a) The Servicer may enter into subservicing agreements with
subservicers (each, a "Subservicer"), for
the servicing and administration of
the Mortgage Loans ("Subservicing
Agreements").
(b) Each Subservicer shall be (i) authorized to transact business
in
the state or states in which the related
Mortgaged Properties it is to service
are situated, if and to the extent required
by applicable law to enable the
Subservicer to perform its obligations
hereunder and under the Subservicing
Agreement, (ii) an institution approved as
a mortgage loan originator by the
Federal Housing Administration or an
institution that has deposit accounts
insured by the FDIC and (iii) a Freddie Mac
or Fannie Mae approved mortgage
servicer. Each Subservicing Agreement must
impose on the Subservicer
requirements conforming to the provisions
set forth in Section 3.08 and provide
for servicing of the Mortgage Loans
consistent with the terms of this Agreement.
The Servicer will examine each Subservicing
Agreement and will be familiar with
the terms thereof. The terms of any
Subservicing Agreement will not be
inconsistent with any of the provisions of
this Agreement. The Servicer and the
Subservicers may enter into and make
amendments to the Subservicing Agreements
or enter into different forms of
Subservicing Agreements; provided, however,
that any such amendments or different forms
shall be consistent with and not
violate the provisions of this Agreement,
and that no such amendment or
different form shall be made or entered
into which could be reasonably expected
to be materially adverse to the interests
of the Trustee, without the consent of
the Trustee. Any variation without the
consent of the Trustee from the
provisions set forth in Section 3.08
relating to insurance or priority
requirements of Subservicing Accounts, or
credits and charges to the
Subservicing Accounts or the timing and
amount of remittances by the
Subservicers to the Servicer, are
conclusively deemed to be inconsistent with
this Agreement and therefore prohibited.
The Servicer shall deliver to the
Trustee and the Depositor copies of all
Subservicing Agreements, and any
amendments or modifications thereof,
promptly upon the Servicer's execution and
delivery of such instruments.
(c) As part of its servicing activities hereunder, the Servicer
(except as otherwise provided in the last
sentence of this paragraph), for the
benefit of the Trustee, shall enforce the
obligations of each Subservicer under
the related Subservicing Agreement,
including, without limitation, any
obligation to make advances in respect of
delinquent payments as required by a
Subservicing Agreement. Such enforcement,
including, without limitation, the
legal prosecution of claims, termination of
Subservicing Agreements, and the
pursuit of other appropriate remedies,
shall be in such form and carried out to
such an extent and at such time as the
Servicer, in its good faith business
judgment, would require were it the owner
of the related Mortgage Loans. The
Servicer shall pay the costs of such
enforcement at its own expense, and shall
be reimbursed therefor only (i) from a
general recovery resulting from such
enforcement, to the extent, if any, that
such recovery exceeds all amounts due
in respect of the related Mortgage Loans or
(ii) from a specific recovery of
costs, expenses or attorneys' fees against
the party against whom such
enforcement is directed.
Section 3.03 Successor Subservicers. The Servicer shall be
entitled
to terminate any Subservicing Agreement and
the rights and obligations of any
Subservicer pursuant to any Subservicing
Agreement in accordance with the terms
and conditions of such Subservicing
Agreement. In the event of termination of
any Subservicer, all servicing obligations
of such Subservicer shall be assumed
simultaneously by the Servicer without any
act or deed on the part of such
Subservicer or the Servicer, and the
Servicer either shall service directly the
related Mortgage Loans or shall enter into
a Subservicing Agreement with a
successor Subservicer which qualifies under
Section 3.02.
Any Subservicing Agreement shall include the provision that
such
agreement may be immediately terminated by
the Depositor or the Trustee without
fee, in accordance with the terms of this
Agreement, in the event that the
Servicer shall, for any reason, no longer
be the Servicer (including termination
due to an Event of Default).
Section 3.04 Liability of the Servicer. Notwithstanding any
Subservicing Agreement, any of the
provisions of this Agreement relating to
agreements or arrangements between the
Servicer and a Subservicer or reference
to actions taken through a Subservicer or
otherwise, the Servicer shall remain
obligated and primarily liable to the
Trustee for the servicing and
administering of the Mortgage Loans in
accordance with the provisions of Section
3.01 without diminution of such obligation
or liability by virtue of such
Subservicing Agreements or arrangements or
by virtue of indemnification from the
Subservicer and to the same extent and
under the same terms and conditions as if
the Servicer alone were servicing and
administering such Mortgage Loans. The
Servicer shall be entitled to enter into
any agreement with a Subservicer for
indemnification of the Servicer by such
Subservicer and nothing contained in
this Agreement shall be deemed to limit or
modify such indemnification.
Section 3.05 No Contractual Relationship between Subservicers
and
the Trustee. Any Subservicing Agreement
that may be entered into and any
transactions or services relating to the
Mortgage Loans involving a Subservicer
in its capacity as such shall be deemed to
be between the Subservicer and the
Servicer alone, and the Trustee (or any
successor Servicer) shall not be deemed
a party thereto and shall have no claims,
rights, obligations, duties or
liabilities with respect to the Subservicer
except as set forth in Section 3.06.
The Servicer shall be solely liable for all
fees owed by it to any Subservicer,
irrespective of whether the Servicer's
compensation pursuant to this Agreement
is sufficient to pay such fees.
Section 3.06 Assumption or Termination of Subservicing Agreements
by
Trustee. In the event the Servicer at any
time shall for any reason no longer be
the Servicer (including by reason of the
occurrence of an Event of Default), the
Trustee, or its designee, or the successor
Servicer if the successor Servicer is
not the Trustee, shall thereupon assume all
of the rights and obligations of the
Servicer under each Subservicing Agreement
that the Servicer may have entered
into, with copies thereof provided to the
Trustee prior to the Trustee assuming
such rights and obligations, unless the
Trustee elects to terminate any
Subservicing Agreement in accordance with
its terms as provided in Section 3.03.
Upon such assumption, the Trustee, its designee or the
successor
servicer shall be deemed, subject to
Section 3.03, to have assumed all of the
Servicer's interest therein and to have
replaced the Servicer as a party to each
Subservicing Agreement to the same extent
as if each Subservicing Agreement had
been assigned to the assuming party, except
that (i) the Servicer shall not
thereby be relieved of any liability or
obligations under any Subservicing
Agreement that arose before it ceased to be
the Servicer and (ii) none of the
Depositor, the Trustee, their designees or
any successor Servicer shall be
deemed to have assumed any liability or
obligation of the Servicer that arose
before it ceased to be the Servicer.
The
Servicer at its expense shall, upon request of the Trustee,
deliver to the assuming party all documents
and records relating to each
Subservicing Agreement and the Mortgage
Loans then being serviced and an
accounting of amounts collected and held by
or on behalf of it, and otherwise
use its best efforts to effect the orderly
and efficient transfer of the
Subservicing Agreements to the assuming
party.
Section 3.07 Collection of Certain Mortgage Loan Payments. (a)
The
Servicer shall make reasonable efforts to
collect all payments called for under
the terms and provisions of the Mortgage
Loans and shall, to the extent such
procedures shall be consistent with this
Agreement and the terms and provisions
of any applicable Insurance Policies,
follow such collection procedures as it
would follow with respect to mortgage loans
comparable to the Mortgage Loans and
held for its own account. Consistent with
the foregoing and Accepted Servicing
Practices, the Servicer may (i) waive any
late payment charge or, if applicable,
any penalty interest, or (ii) extend the
due dates for the Scheduled Payments
due on a Mortgage Note for a period of not
greater than 180 days; provided, that
any extension pursuant to clause (ii) above
shall not affect the amortization
schedule of any Mortgage Loan for purposes
of any computation hereunder, except
as provided below. In the event of any such
arrangement pursuant to clause (ii)
above, the Servicer shall make timely
advances on such Mortgage Loan during such
extension pursuant to Section 4.01 and in
accordance with the amortization
schedule of such Mortgage Loan without
modification thereof by reason of such
arrangements, subject to Section 4.01(d)
pursuant to which the Servicer shall
not be required to make any such advances
that are Nonrecoverable P&I Advances.
Notwithstanding the foregoing, in the event
that any Mortgage Loan is in default
or, in the judgment of the Servicer, such
default is reasonably foreseeable, the
Servicer, consistent with the standards set
forth in Section 3.01, may also
waive, modify or vary any term of such
Mortgage Loan (including modifications
that would change the Mortgage Interest
Rate, forgive the payment of principal
or interest, or extend the final maturity
date of such Mortgage Loan), accept
payment from the related Mortgagor of an
amount less than the Stated Principal
Balance in final satisfaction of such
Mortgage Loan, or consent to the
postponement of strict compliance with any
such term or otherwise grant
indulgence to any Mortgagor (any and all
such waivers, modifications, variances,
forgiveness of principal or interest,
postponements, or indulgences collectively
referred to herein as "Forbearance");
provided, however, that the terms of any
Mortgage Loan may only be waived, modified
or varied once following the Cut-off
Date while the Mortgage Loan remains
outstanding; provided, further, that the
final maturity date of any Mortgage Loan
may not be extended beyond the Final
Scheduled Distribution Date for the LIBOR
Certificates. The Servicer's analysis
supporting any Forbearance and the
conclusion that any Forbearance meets the
standards of Section 3.01 shall be
reflected in writing in the applicable
Servicing File. Notwithstanding the
foregoing, the Servicer may waive, in whole
or in part, a Prepayment Premium only under
the following circumstances: (i)
such waiver relates to a default or a
reasonably foreseeable default and would,
in the reasonable judgment of the Servicer,
maximize recovery of total proceeds
taking into account the value of such
Prepayment Premium and the related
Mortgage Loan, (ii) such Prepayment Premium
is not permitted to be collected by
applicable federal, state or local law or
regulation, (iii) the collection of
such Prepayment Premium would be considered
"predatory" pursuant to written
guidance published or issued by any
applicable federal, state or local
regulatory authority acting in its official
capacity and having jurisdiction
over such matters, or (iv) the
enforceability thereof is limited (1) by
bankruptcy, insolvency, moratorium,
receivership or other similar laws relating
to creditor's rights or (2) due to
acceleration in connection with a foreclosure
or other involuntary payment. If a
Prepayment Premium is waived other than as
permitted in this Section 3.07(a), then the
Servicer is required to pay the
amount of such waived Prepayment Premium,
for the benefit of the Holders of the
Class N and Class X Certificates, by
depositing such amount into the Collection
Account together with and at the time that
the amount prepaid on the related
Mortgage Loan is required to be deposited
into the Collection Account; provided,
however, that the Servicer shall not have
an obligation to pay the amount of any
uncollected Prepayment Premium if the
failure to collect such amount is the
direct result of inaccurate or incomplete
information on the Mortgage Loan
Schedule in effect at such time.
(b) The Servicer shall give notice to the Trustee, each Rating
Agency and the Depositor of any proposed
change of the location of the
Collection Account within a reasonable
period of time prior to any change
thereof.
Section 3.08 Subservicing Accounts. In those cases where a
Subservicer is servicing a Mortgage Loan
pursuant to a Subservicing Agreement,
the Subservicer will be required to
establish and maintain one or more accounts
(collectively, the "Subservicing Account").
The Subservicing Account shall be an
Eligible Account and shall otherwise be
acceptable to the Servicer. The
Subservicer shall deposit in the clearing
account (which account must be an
Eligible Account) in which it customarily
deposits payments and collections on
mortgage loans in connection with its
mortgage loan servicing activities on a
daily basis, and in no event more than one
Business Day after the Subservicer's
receipt thereof, all proceeds of Mortgage
Loans received by the Subservicer less
its servicing compensation to the extent
permitted by the Subservicing
Agreement, and shall thereafter deposit
such amounts in the Subservicing
Account, in no event more than two Business
Days after the deposit of such funds
into the clearing account. The Subservicer
shall thereafter deposit such
proceeds in the Collection Account or remit
such proceeds to the Servicer for
deposit in the Collection Account not later
than two Business Days after the
deposit of such amounts in the Subservicing
Account. For purposes of this
Agreement, the Servicer shall be deemed to
have received payments on the
Mortgage Loans when the Subservicer
receives such payments.
Section 3.09 Collection of Taxes, Assessments and Similar
Items;
Escrow Accounts. (a) The Servicer shall
ensure that each of the Mortgage Loans
shall be covered by a paid-in-full,
life-of-the-loan tax service contract in
effect with respect to each Mortgage Loan
(each, a "Tax Service Contract");
provided, that the Responsible Party
transferred a fully transferable Tax
Service Contract to the Servicer at no
expense to the Servicer. Each Tax Service
Contract shall be assigned to the Trustee,
or its designee, at the Servicer's
expense in the event that the Servicer is
terminated as Servicer of the related
Mortgage Loan.
(b) To the extent that the services described in this paragraph
(b)
are not otherwise provided pursuant to the
Tax Service Contracts described in
paragraph (a) hereof, the Servicer
undertakes to perform such functions. To the
extent the related Mortgage Loan provides
for Escrow Payments, the Servicer
shall establish and maintain, or cause to
be established and maintained, one or
more accounts (the "Escrow Accounts"),
which shall be Eligible Accounts. The
Servicer shall deposit in the clearing
account (which account must be an
Eligible Account) in which it customarily
deposits payments and collections on
mortgage loans in connection with its
mortgage loan servicing activities on a
daily basis, and in no event more than one
Business Day after the Servicer's
receipt thereof, all collections from the
Mortgagors (or related advances from
Subservicers) for the payment of taxes,
assessments, hazard insurance premiums
and comparable items for the account of the
Mortgagors ("Escrow Payments")
collected on account of the Mortgage Loans
and shall thereafter deposit such
Escrow Payments in the Escrow Accounts, in
no event more than two Business Days
after the deposit of such funds in the
clearing account, for the purpose of
effecting the payment of any such items as
required under the terms of this
Agreement. Withdrawals of amounts from an
Escrow Account may be made only to (i)
effect payment of taxes, assessments,
hazard insurance premiums, and comparable
items; (ii) reimburse the Servicer (or a
Subservicer to the extent provided in
the related Subservicing Agreement) out of
related collections for any advances
made pursuant to Section 3.01 (with respect
to taxes and assessments) and
Section 3.13 (with respect to hazard
insurance); (iii) refund to Mortgagors any
sums as may be determined to be overages;
(iv) pay interest, if required and as
described below, to Mortgagors on balances
in the Escrow Account; (v) clear and
terminate the Escrow Account at the
termination of the Servicer's obligations
and responsibilities in respect of the
Mortgage Loans under this Agreement; or
(vi) recover amounts deposited in error. As
part of its servicing duties, the
Servicer or Subservicers shall pay to the
Mortgagors interest on funds in Escrow
Accounts, to the extent required by law
and, to the extent that interest earned
on funds in the Escrow Accounts is
insufficient, to pay such interest from its
or their own funds, without any
reimbursement therefor. To the extent that a
Mortgage does not provide for Escrow
Payments, the Servicer shall determine
whether any such payments are made by the
Mortgagor in a manner and at a time
that is necessary to avoid the loss of the
Mortgaged Property due to a tax sale
or the foreclosure as a result of a tax
lien. If any such payment has not been
made and the Servicer receives notice of a
tax lien with respect to the Mortgage
Loan being imposed, the Servicer will,
promptly and to the extent required to
avoid loss of the Mortgaged Property,
advance or cause to be advanced funds
necessary to discharge such lien on the
Mortgaged Property. The Servicer assumes
full responsibility for the payment of all
such bills within such time and shall
effect payments of all such bills
irrespective of the Mortgagor's faithful
performance in the payment of same or the
making of the Escrow Payments and
shall make advances from its own funds to
effect such payments; provided,
however, that such advances are deemed to
be Servicing Advances.
Section 3.10 Collection Account. (a) On behalf of the Trustee,
the
Servicer shall establish and maintain, or
cause to be established and
maintained, one or more Eligible Accounts
(such account or accounts, the
"Collection Account"), held in trust for
the benefit of the Trustee. On behalf
of the Trustee, the Servicer shall deposit
or cause to be deposited in the
clearing account (which account must be an
Eligible Account) in which it
customarily deposits payments and
collections on mortgage loans in connection
with its mortgage loan servicing activities
on a daily basis, and in no event
more than one Business Day after the
Servicer's receipt thereof, and shall
thereafter deposit in the Collection
Account, in no event more than two Business
Days after the deposit of such funds into
the clearing account, as and when
received or as otherwise required
hereunder, the following payments and
collections received or made by it
subsequent to the Cut-off Date (other than in
respect of principal or interest on the
related Mortgage Loans due on or before
the Cut-off Date), or payments (other than
Principal Prepayments) received by it
on or prior to the Cut-off Date but
allocable to a Due Period subsequent
thereto:
(i) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans;
(ii) all payments on account of interest (net of the related
Servicing
Fee) on each Mortgage Loan;
(iii) all Insurance Proceeds and Condemnation Proceeds (to the
extent
such Insurance Proceeds and Condemnation Proceeds are not to be
applied to
the restoration of the related Mortgaged Property or released
to the
related Mortgagor in accordance with the express requirements
of
law or in
accordance with prudent and customary servicing practices) and
Liquidation Proceeds;
(iv) any amounts required to be deposited pursuant to Section
3.12
in
connection with any losses realized on Permitted Investments
with
respect to
funds held in the Collection Account;
(v) any amounts required to be deposited by the Servicer pursuant
to
the second
paragraph of Section 3.13(a) in respect of any blanket policy
deductibles;
(vi) all proceeds of any Mortgage Loan repurchased or purchased
in
accordance
with this Agreement; and
(vii) all Prepayment Premiums collected by the Servicer.
The foregoing requirements for deposit in the Collection
Account
shall be exclusive, it being understood and
agreed that, without limiting the
generality of the foregoing, payments in
the nature of late payment charges, NSF
fees, reconveyance fees, assumption fees
and other similar fees and charges need
not be deposited by the Servicer in the
Collection Account and shall, upon
collection, belong to the Servicer as
additional compensation for its servicing
activities. In the event the Servicer shall
deposit in the Collection Account
any amount not required to be deposited
therein, it may at any time withdraw
such amount from the Collection Account,
any provision herein to the contrary
notwithstanding.
(b) Funds in the Collection Account may be invested in
Permitted
Investments in accordance with the
provisions set forth in Section 3.12. The
Servicer shall give notice to the Trustee
and the Depositor of the location of
the Collection Account maintained by it
when established and prior to any change
thereof.
Section 3.11 Withdrawals from the Collection Account. (a) The
Servicer shall, from time to time, make
withdrawals from the Collection Account
for any of the following purposes or as
described in Section 4.01:
(i) on or prior to the Remittance Date, to remit to the Trustee
(A)
the
Trustee Fee with respect to such Distribution Date and (B) all
Available
Funds in respect of the related Distribution Date together with
all
amounts representing Prepayment Premiums from the Mortgage
Loans
received during the related
Prepayment Period;
(ii) to reimburse the Servicer for P&I Advances, but only to
the
extent of
amounts received which represent Late Collections (net of the
related
Servicing Fees) of Scheduled Payments on Mortgage Loans with
respect to
which such P&I Advances were made in accordance with the
provisions
of Section 4.01;
(iii) to pay the Servicer or any Subservicer (A) any unpaid
Servicing
Fees or (B) any unreimbursed Servicing Advances with respect to
each
Mortgage Loan, but in each case only to the extent of any Late
Collections, Liquidation Proceeds, Condemnation Proceeds,
Insurance
Proceeds
or other amounts as may be collected by the Servicer from a
Mortgagor, or otherwise received
with respect to such Mortgage Loan (or
the
related REO Property);
(iv) to pay to the Servicer as servicing compensation (in
addition
to the
Servicing Fee) on the Remittance Date any interest or
investment
income
earned on funds deposited in the Collection Account;
(v) to pay to the Responsible Party or the Depositor, with
respect
to each
Mortgage Loan that has previously been repurchased or replaced
pursuant
to this Agreement all amounts received thereon subsequent to
the
date of
purchase or substitution, as the case may be;
(vi) to reimburse the Servicer for any P&I Advance or
Servicing
Advance
previously made which the Servicer has determined to be a
Nonrecoverable P&I Advance or Nonrecoverable Servicing Advance
in
accordance
with the provisions of Section 4.01, including in connection
with the
modification of a Mortgage Loan where (1) such Advance is added
to the
unpaid principal balance or (2) a portion of the unpaid
principal
balance of
the Mortgage Loan is forgiven;
(vii) to pay, or to reimburse the Servicer for advances in
respect
of,
expenses incurred in connection with any Mortgage Loan pursuant
to
Section
3.15;
(viii) to reimburse the Servicer, the Depositor or the Trustee
for
expenses
incurred by or reimbursable to the Servicer, the Depositor or
the
Trustee,
as the case may be, pursuant to Section 6.03 or Section 8.05;
(ix) to reimburse the Servicer or the Trustee, as the case may
be,
for
expenses reasonably incurred in respect of the breach or defect
giving
rise to
the repurchase obligation under Section 2.03 of this Agreement
that were
included in the Repurchase Price of the Mortgage Loan,
including
any
expenses arising out of the enforcement of the repurchase
obligation,
to the
extent not otherwise paid pursuant to the terms hereof;
(x) to withdraw any amounts deposited in the Collection Account
in
error;
(xi) to withdraw any amounts held in the Collection Account and
not
required
to be remitted to the Trustee on the Remittance Date occurring
in
the month
in which such amounts are deposited into the Collection
Account,
to
reimburse the Servicer for unreimbursed Advances; and
(xii) to clear and terminate the Collection Account upon
termination
of this
Agreement.
(b) The Servicer shall keep and maintain separate accounting, on
a
Mortgage Loan by Mortgage Loan basis, for
the purpose of justifying any
withdrawal from the Collection Account, to
the extent held by or on behalf of
it, pursuant to subclauses (a)(ii), (iii),
(iv), (v), (vi), (vii), (viii) and
(ix) above. The Servicer shall provide
written notification to the Depositor, on
or prior to the next succeeding Remittance
Date, upon making any withdrawals
from the Collection Account pursuant to
subclause (a)(vi) above.
Section 3.12 Investment of Funds in the Collection Account and
the
Distribution Account. (a) The Servicer may
invest the funds in the Collection
Account and the Trustee may invest funds in
the Distribution Account (for
purposes of this Section 3.12, such
Accounts are referred to as an "Investment
Account") in one or more Permitted
Investments bearing interest or sold at a
discount, and maturing, unless payable on
demand no later than the Business Day
immediately preceding the date on which
such funds are required to be withdrawn
from such account pursuant to this
Agreement. All such Permitted Investments
shall be held to maturity, unless payable
on demand. Any investment of funds in
an Investment Account shall be made in the
name of the Trustee. The Trustee
shall be entitled to sole possession over
each such investment, and any
certificate or other instrument evidencing
any such investment shall be
delivered directly to the Trustee or its
agent, together with any document of
transfer necessary to transfer title to
such investment to the Trustee. In the
event amounts on deposit in an Investment
Account are at any time invested in a
Permitted Investment payable on demand, the
Trustee may:
(x) consistent
with any notice required to be given
thereunder, demand that payment thereon be made on the
last day such Permitted Investment may otherwise mature
hereunder in an amount equal to the lesser of (1) all
amounts then payable thereunder and (2) the amount
required to be withdrawn on such date; and
(y) demand
payment of all amounts due thereunder that such
Permitted Investment would not constitute a Permitted
Investment in respect of funds thereafter on deposit in
the Investment Account.
(b) All income and gain realized from the investment of funds
deposited in the Collection Account held by
or on behalf of the Servicer, shall
be for the benefit of the Servicer and
shall be subject to its withdrawal in the
manner set forth in Section 3.11. The
Servicer shall deposit in the Collection
Account the amount of any loss of principal
incurred in respect of any such
Permitted Investment made with funds in
such accounts immediately upon
realization of such loss.
(c) All income and gain realized from the investment of funds
deposited in the Distribution Account held
by the Trustee shall be for the
benefit of the Trustee. The Trustee shall
deposit in the Distribution Account
the amount of any loss of principal
incurred in respect of any such Permitted
Investment made with funds in such accounts
immediately upon realization of such
loss.
(d) Except as otherwise expressly provided in this Agreement, if
any
default occurs in the making of a payment
due under any Permitted Investment, or
if a default occurs in any other
performance required under any Permitted
Investment, the Trustee shall take such
action as may be appropriate to enforce
such payment or performance, including the
institution and prosecution of
appropriate proceedings.
(e) The Trustee or its Affiliates are permitted to receive
additional compensation that could be
deemed to be in the Trustee's economic
self-interest for (i) serving as investment
adviser, administrator, shareholder,
servicing agent, custodian or sub-custodian
with respect to certain of the
Permitted Investments, (ii) using
Affiliates to effect transactions in certain
Permitted Investments and (iii) effecting
transactions in certain Permitted
Investments.
Section 3.13 Maintenance of Hazard Insurance, Errors and
Omissions
and Fidelity Coverage. (a) The Servicer
shall cause to be maintained for each
Mortgage Loan standard hazard insurance on
the related Mortgaged Property in an
amount which is at least equal to the least
of (i) the outstanding principal
balance of such Mortgage Loan, (ii) the
amount necessary to fully compensate for
any damage or loss to the improvements that
are a part of such property on a
replacement cost basis and (iii) the
maximum insurable value of the improvements
which are a part of such Mortgaged
Property, in each case in an amount not less
than such amount as is necessary to avoid
the application of any coinsurance
clause contained in the related hazard
insurance policy. The Servicer shall also
cause to be maintained fire insurance with
extended coverage on each REO
Property in an amount which is at least
equal to the lesser of (i) the maximum
insurable value of the improvements which
are a part of such property and (ii)
the outstanding principal balance of the
related Mortgage Loan at the time it
became an REO Property, plus accrued
interest at the Mortgage Interest Rate and
related Servicing Advances. The Servicer
will comply in the performance of this
Agreement with all reasonable rules and
requirements of each insurer under any
such hazard policies. Any amounts to be
collected by the Servicer under any such
policies (other than amounts to be applied
to the restoration or repair of the
property subject to the related Mortgage or
amounts to be released to the
Mortgagor in accordance with the procedures
that the Servicer would follow in
servicing loans held for its own account,
subject to the terms and conditions of
the related Mortgage and Mortgage Note)
shall be deposited in the Collection
Account, subject to withdrawal pursuant to
Section 3.11. Any cost incurred by
the Servicer in maintaining any such
insurance shall not, for the purpose of
calculating distributions to the Trustee,
be added to the unpaid principal
balance of the related Mortgage Loan,
notwithstanding that the terms of such
Mortgage Loan so permit. It is understood
and agreed that no earthquake or other
additional insurance is to be required of
any Mortgagor other than pursuant to
such applicable laws and regulations as
shall at any time be in force and as
shall require such additional insurance. If
the Mortgaged Property or REO
Property is at any time in an area
identified in the Federal Register by the
Federal Emergency Management Agency as
having special flood hazards and flood
insurance has been made available, the
Servicer will cause to be maintained a
flood insurance policy in respect thereof.
Such flood insurance shall be in an
amount equal to the lesser of (i) the
unpaid principal balance of the related
Mortgage Loan and (ii) the maximum amount
of such insurance available for the
related Mortgaged Property under the
national flood insurance program (assuming
that the area in which such Mortgaged
Property is located is participating in
such program).
In the event that the Servicer shall obtain and maintain a
blanket
policy with an insurer having a General
Policy Rating of B:VI or better in
Best's (or such other rating that is
comparable to such rating) insuring against
hazard losses on all of the Mortgage Loans,
it shall conclusively be deemed to
have satisfied its obligations as set forth
in the first two sentences of this
Section 3.13, it being understood and
agreed that such policy may contain a
deductible clause, in which case the
Servicer shall, in the event that there
shall not have been maintained on the
related Mortgaged Property or REO Property
a policy complying with the first two
sentences of this Section 3.13, and there
shall have been one or more losses which
would have been covered by such policy,
deposit to the Collection Account from its
own funds the amount not otherwise
payable under the blanket policy because of
such deductible clause. In
connection with its activities as
administrator and servicer of the Mortgage
Loans, the Servicer agrees to prepare and
present, on behalf of itself, the
Trustee claims under any such blanket
policy in a timely fashion in accordance
with the terms of such policy.
(b) The Servicer shall keep in force during the term of this
Agreement a policy or policies of insurance
covering errors and omissions for
failure in the performance of the
Servicer's obligations under this Agreement,
which policy or policies shall be in such
form and amount that would meet the
requirements of Fannie Mae or Freddie Mac
if it were the purchaser of the
Mortgage Loans, unless the Servicer has
obtained a waiver of such requirements
from Fannie Mae or Freddie Mac. The
Servicer shall also maintain a fidelity bond
in the form and amount that would meet the
requirements of Fannie Mae or Freddie
Mac, unless the Servicer has obtained a
waiver of such requirements from Fannie
Mae or Freddie Mac. The Servicer shall
provide the Trustee upon request with
copies of any such insurance policies and
fidelity bond. The Servicer shall be
deemed to have complied with this provision
if an Affiliate of the Servicer has
such errors and omissions and fidelity bond
coverage and, by the terms of such
insurance policy or fidelity bond, the
coverage afforded thereunder extends to
the Servicer. Any such errors and omissions
policy and fidelity bond shall by
its terms not be cancelable without thirty
days' prior written notice to the
Trustee. The Servicer shall also cause each
Subservicer to maintain a policy of
insurance covering errors and omissions and
a fidelity bond which would meet
such requirements.
Section 3.14 Enforcement of Due-on-Sale Clauses; Assumption
Agreements. The Servicer will, to the
extent it has knowledge of any conveyance
or prospective conveyance of any Mortgaged
Property by any Mortgagor (whether by
absolute conveyance or by contract of sale,
and whether or not the Mortgagor
remains or is to remain liable under the
Mortgage Note and/or the Mortgage),
exercise its rights to accelerate the
maturity of such Mortgage Loan under the
"due-on-sale" clause, if any, applicable
thereto; provided, however, that the
Servicer shall not be required to take such
action if, in its sole business
judgment, the Servicer believes it is not
in the best interests of the Trust
Fund and shall not exercise any such rights
if prohibited by law from doing so.
If the Servicer reasonably believes it is
unable under applicable law to enforce
such "due-on-sale" clause or if any of the
other conditions set forth in the
proviso to the preceding sentence apply,
the Servicer will enter into an
assumption and modification agreement from
or with the person to whom such
property has been conveyed or is proposed
to be conveyed, pursuant to which such
person becomes liable under the Mortgage
Note, the Servicer has the prior
consent of the primary mortgage guaranty
insurer, if any, and, to the extent
permitted by applicable state law, the
Mortgagor remains liable thereon. The
Servicer is also authorized to enter into a
substitution of liability agreement
with such person, pursuant to which the
original Mortgagor is released from
liability and such person is substituted as
the Mortgagor and becomes liable
under the Mortgage Note; provided, that no
such substitution shall be effective
unless such person satisfies the
underwriting criteria of the Servicer and has a
credit risk rating at least equal to that
of the original Mortgagor. In
connection with any assumption,
modification or substitution, the Servicer shall
apply such underwriting standards and
follow such practices and procedures as
shall be normal and usual in its general
mortgage servicing activities and as it
applies to other mortgage loans owned
solely by it. The Servicer shall not take
or enter into any assumption and
modification agreement, however, unless (to the
extent practicable in the circumstances) it
shall have received confirmation, in
writing, of the continued effectiveness of
any applicable hazard insurance
policy, or a new policy meeting the
requirements of this Section is obtained.
Any fee collected by the Servicer in
respect of an assumption or substitution of
liability agreement will be retained by the
Servicer as additional servicing
compensation. In connection with any such
assumption, no material term of the
Mortgage Note (including but not limited to
the related Mortgage Interest Rate
and the amount of the Scheduled Payment)
may be amended or modified, except as
otherwise required pursuant to the terms
thereof. The Servicer shall notify the
Trustee that any such substitution,
modification or assumption agreement has
been completed by forwarding to the Trustee
the executed original of such
substitution or assumption agreement, which
document shall be added to the
related Mortgage File and shall, for all
purposes, be considered a part of such
Mortgage File to the same extent as all
other documents and instruments
constituting a part thereof.
Notwithstanding the foregoing paragraph or any other provision
of
this Agreement, the Servicer shall not be
deemed to be in default, breach or any
other violation of its obligations
hereunder by reason of any assumption of a
Mortgage Loan by operation of law or by the
terms of the Mortgage Note or any
assumption which the Servicer may be
restricted by law from preventing, for any
reason whatsoever. For purposes of this
Section 3.14, the term "assumption" is
deemed to also include a sale (of the
Mortgaged Property) subject to the
Mortgage that is not accompanied by an
assumption or substitution of liability
agreement.
Section 3.15 Realization upon Defaulted Mortgage Loans. The
Servicer
shall use its best efforts, consistent with
Accepted Servicing Practices, to
foreclose upon or otherwise comparably
convert (which may include an acquisition
of REO Property) the ownership of
properties securing such of the Mortgage Loans
as come into and continue in default and as
to which no satisfactory
arrangements can be made for collection of
delinquent payments pursuant to
Section 3.07, and which are not released
from this Agreement pursuant to any
other provision hereof. The Servicer shall
use reasonable efforts to realize
upon such defaulted Mortgage Loans in such
manner as will maximize the receipt
of principal and interest by the Trustee,
taking into account, among other
things, the timing of foreclosure
proceedings. The foregoing is subject to the
provisions that, in any case in which a
Mortgaged Property shall have suffered
damage from an uninsured cause, the
Servicer shall not be required to expend its
own funds toward the restoration of such
property unless it shall determine in
its sole discretion (i) that such
restoration will increase the net proceeds of
liquidation of the related Mortgage Loan to
the Trustee, after reimbursement to
itself for such expenses, and (ii) that
such expenses will be recoverable by the
Servicer through Insurance Proceeds,
Condemnation Proceeds or Liquidation
Proceeds from the related Mortgaged
Property, as contemplated in Section 3.11.
The Servicer shall be responsible for all
other costs and expenses incurred by
it in any such proceedings; provided,
however, that it shall be entitled to
reimbursement thereof from the related
property, as contemplated in Section
3.11. In circumstances where the Servicer
determines that it would be
uneconomical to foreclose on the related
Mortgaged Property, the Servicer may
write off the entire outstanding principal
balance of the related Second Lien
Mortgage Loan as bad debt.
The proceeds of any Liquidation Event or REO Disposition, as well
as
any recovery resulting from a partial
collection of Insurance Proceeds,
Condemnation Proceeds or Liquidation
Proceeds or any income from an REO
Property, will be applied in the following
order of priority: first, to
reimburse the Servicer or any Subservicer
for any related unreimbursed Servicing
Advances, pursuant to Section 3.11 or 3.17;
second, to accrued and unpaid
interest on the Mortgage Loan or REO
Imputed Interest, at the Mortgage Interest
Rate, to the date of the liquidation or REO
Disposition, or to the Due Date
prior to the Remittance Date on which such
amounts are to be distributed if not
in connection with a Liquidation Event or
REO Disposition; third, to reimburse
the Servicer for any related unreimbursed
P&I Advances, pursuant to Section
3.11; and fourth, as a recovery of
principal of the Mortgage Loan. If the amount
of the recovery so allocated to interest is
less than a full recovery thereof,
that amount will be allocated as follows:
first, to unpaid Servicing Fees; and
second, as interest at the Mortgage
Interest Rate (net of the Servicing Fee
Rate). The portion of the recovery so
allocated to unpaid Servicing Fees shall
be reimbursed to the Servicer or any
Subservicer pursuant to Section 3.11 or
3.17. The portions of the recovery so
allocated to interest at the Mortgage
Interest Rate (net of the Servicing Fee
Rate) and to principal of the Mortgage
Loan shall be applied as follows: first, to
reimburse the Servicer or any
Subservicer for any related unreimbursed
Servicing Advances in accordance with
Section 3.11 or 3.17, and second, to the
Trustee in accordance with the
provisions of Section 4.02, subject to the
last paragraph of Section 3.17 with
respect to certain excess recoveries from
an REO Disposition.
Notwithstanding anything to the contrary contained herein, in
connection with a foreclosure or acceptance
of a deed in lieu of foreclosure, in
the event the Servicer has received actual
notice of, or has actual knowledge of
the presence of, hazardous or toxic
substances or wastes on the related
Mortgaged Property, or if the Trustee
otherwise requests, the Servicer shall
cause an environmental inspection or review
of such Mortgaged Property to be
conducted by a qualified inspector. Upon
completion of the inspection, the
Servicer shall promptly provide the Trustee
and the Depositor with a written
report of the environmental inspection.
After reviewing the environmental inspection report, the
Depositor
shall determine how the Servicer shall
proceed with respect to the Mortgaged
Property. In the event (a) the
environmental inspection report indicates that
the Mortgaged Property is contaminated by
hazardous or toxic substances or
wastes and (b) the Depositor directs the
Servicer to proceed with foreclosure or
acceptance of a deed in lieu of
foreclosure, the Servicer shall be reimbursed
for all reasonable costs associated with
such foreclosure or acceptance of a
deed in lieu of foreclosure and any related
environmental clean-up costs, as
applicable, from the related Liquidation
Proceeds, or if the Liquidation
Proceeds are insufficient to fully
reimburse the Servicer, the Servicer shall be
entitled to be reimbursed from amounts in
the Collection Account pursuant to
Section 3.11. In the event the Depositor
directs the Servicer not to proceed
with foreclosure or acceptance of a deed in
lieu of foreclosure, the Servicer
shall be reimbursed from general
collections for all Servicing Advances made
with respect to the related Mortgaged
Property from the Collection Account
pursuant to Section 3.11.
Section 3.16 Release of Mortgage Files. (a) Upon the payment in
full
of any Mortgage Loan, or the receipt by the
Servicer of a notification that
payment in full shall be escrowed in a
manner customary for such purposes, the
Servicer will, within five (5) Business
Days of the payment in full, notify the
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 Collection Account pursuant to
Section 3.10 have been or will be so
deposited) of a Servicing Officer and shall
request delivery to it of the Custodial
File. Upon receipt of such certification
and request, the Trustee shall promptly
release the related Custodial File to
the Servicer within three (3) Business
Days. No expenses incurred in connection
with any instrument of satisfaction or deed
of reconveyance shall be chargeable
to the Collection Account.
(b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan,
including, for this purpose, collection under
any Insurance Policy relating to the
Mortgage Loans, the Trustee shall, upon
request of the Servicer and delivery to the
Trustee, of a Request for Release,
release the related Custodial File to the
Servicer, and the Trustee shall, at
the direction of the Servicer, execute such
documents as shall be necessary to
the prosecution of any such proceedings and
the Servicer shall retain the
Mortgage File in trust for the benefit of
the Trustee. Such Request for Release
shall obligate the Servicer to return each
and every document previously
requested from the Custodial File to the
Trustee when the need therefor by the
Servicer no longer exists, unless the
Mortgage Loan has been liquidated and the
Liquidation Proceeds relating to the
Mortgage Loan have been deposited in the
Collection Account or the Mortgage File or
such document has been delivered to
an attorney, or to a public trustee or
other public official as required by law,
for purposes of initiating or pursuing
legal action or other proceedings for the
foreclosure of the Mortgaged Property
either judicially or non-judicially, and
the Servicer has delivered to the 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 written certification of a Servicing Officer, the Trustee
shall
execute and deliver to the Servicer copies
of any court pleadings, requests for
trustee's sale or other documents
reasonably necessary to the foreclosure or
trustee's sale in respect of a Mortgaged
Property or to any legal action brought
to obtain judgment against any Mortgagor on
the Mortgage Note or Mortgage or to
obtain a deficiency judgment, or to enforce
any other remedies or rights
provided by the Mortgage Note or Mortgage
or otherwise available at law or in
equity, or shall exercise and deliver to
the Servicer a power of attorney
sufficient to authorize the Servicer to
execute such documents on its behalf.
Each such certification shall include a
request that such pleadings or documents
be executed by the Trustee and a statement
as to the reason such documents or
pleadings are required and that the
execution and delivery thereof by the
Trustee will not invalidate or otherwise
affect the lien of the Mortgage, except
for the termination of such a lien upon
completion of the foreclosure or
trustee's sale.
Section 3.17 Title, Conservation and Disposition of REO
Property.
(a) This Section shall apply only to REO
Properties acquired for the account of
the Trustee and shall not apply to any REO
Property relating to a Mortgage Loan
which was purchased or repurchased from the
Trustee pursuant to any provision
hereof. In the event that title to any such
REO Property is acquired, the
Servicer shall cause the deed or
certificate of sale to be issued in the name of
the Trustee, on behalf of the
Certificateholders.
(b) The Servicer shall manage, conserve, protect and operate
each
REO Property for the Trustee solely for the
purpose of its prompt disposition
and sale. The Servicer, either itself or
through an agent selected by the
Servicer, shall manage, conserve, protect
and operate the REO Property in the
same manner that it manages, conserves,
protects and operates other foreclosed
property for its own account, and in the
same manner that similar property in
the same locality as the REO Property is
managed. The Servicer shall attempt to
sell the same (and may temporarily rent the
same for a period not greater than
one year, except as otherwise provided
below) on such terms and conditions as
the Servicer deems to be in the best
interest of the Trustee. The Servicer shall
notify the Trustee from time to time as to
the status of each REO Property.
(c) The Servicer shall use its best efforts to dispose of the
REO
Property as soon as possible (subject to
the Trustee's right to veto any
proposed sale of REO Property) and shall
sell such REO Property in any event
within three years after title has been
taken to such REO Property, unless the
Servicer determines, and gives an
appropriate notice to the Trustee to such
effect, that a longer period is necessary
for the orderly liquidation of such
REO Property. If a period longer than three
years is permitted under the
foregoing sentence and is necessary to sell
any REO Property, the Servicer shall
report monthly to the Trustee as to the
progress being made in selling such REO
Property. Notwithstanding its veto rights,
the Trustee has no obligation with
respect to REO Dispositions.
(d) The Servicer shall segregate and hold all funds collected
and
received in connection with the operation
of any REO Property separate and apart
from its own funds and general assets and
shall deposit such funds in the
Collection Account.
(e) The
Servicer shall deposit net of reimbursement to the Servicer
for any related outstanding Servicing
Advances and unpaid Servicing Fees
provided in Section 3.11, or cause to be
deposited, on a daily basis in the
Collection Account all revenues received
with respect to the related REO
Property and shall withdraw therefrom funds
necessary for the proper operation,
management and maintenance of the REO
Property.
(f) The Servicer, upon an REO Disposition, shall be entitled to
reimbursement for any related unreimbursed
Servicing Advances as well as any
unpaid Servicing Fees from proceeds
received in connection with the REO
Disposition, as further provided in Section
3.11.
(g) Any net proceeds from an REO Disposition which are in excess
of
the unpaid principal balance of the related
Mortgage Loan plus all unpaid REO
Imputed Interest thereon through the date
of the REO Disposition shall be
retained by the Servicer as additional
servicing compensation.
(h) The Servicer shall use its reasonable best efforts to sell,
or
cause the Subservicer to sell, any REO
Property as soon as possible, but in no
event later than the conclusion of the
third calendar year beginning after the
year of its acquisition by the REMIC unless
(i) the Servicer applies for an
extension of such period from the Internal
Revenue Service pursuant to the REMIC
Provisions and Code Section 856(e)(3), in
which event such REO Property shall be
sold within the applicable extension
period, or (ii) the Servicer obtains for
the Trustee an Opinion of Counsel,
addressed to the Depositor, the Trustee and
the Servicer, to the effect that the
holding by the Lower Tier REMIC of such REO
Property subsequent to such period will not
result in the imposition of taxes on
"prohibited transactions" as defined in
Section 860F of the Code or cause any
Trust REMIC to fail to qualify as a REMIC
under the REMIC Provisions or
comparable provisions of relevant state
laws at any time. The Servicer shall
manage, conserve, protect and operate each
REO Property for the Trustee solely
for the purpose of its prompt disposition
and sale in a manner which does not
cause such REO Property to fail to qualify
as "foreclosure property" within the
meaning of Section 860G(a)(8) or result in
the receipt by the Lower Tier REMIC
of any "income from non-permitted assets"
within the meaning of Section
860F(a)(2)(B) of the Code or any "net
income from foreclosure property" which is
subject to taxation under Section
860G(a)(1) of the Code. Pursuant to its
efforts to sell such REO Property, the
Servicer shall either itself or through
an agent selected by the Servicer protect
and conserve such REO Property in the
same manner and to such extent as is
customary in the locality where such REO
Property is located and may, incident to
its conservation and protection of the
interests of the Trustee on behalf of the
Certificateholders, rent the same, or
any part thereof, as the Servicer deems to
be in the best interest of the
Trustee on behalf of the Certificateholders
for the period prior to the sale of
such REO Property; provided, however, that
any rent received or accrued with
respect to such REO Property qualifies as
"rents from real property" as defined
in Section 856(d) of the Code.
Section 3.18 Notification of Adjustments. With respect to each
Mortgage Loan, the Servicer shall adjust
the Mortgage Interest Rate on the
related Adjustment Date and shall adjust
the Scheduled Payment on the related
mortgage payment adjustment date, if
applicable, in compliance with the
requirements of applicable law and the
related Mortgage and Mortgage Note. The
Servicer shall execute and deliver any and
all necessary notices required under
applicable law and the terms of the related
Mortgage Note and Mortgage regarding
the Mortgage Interest Rate and Scheduled
Payment adjustments. The Servicer shall
promptly, upon written request therefor,
deliver to the Trustee such
notifications and any additional applicable
data regarding such adjustments and
the methods used to calculate and implement
such adjustments. Upon the discovery
by the Servicer or the receipt of notice
from the Trustee that the Servicer has
failed to adjust a Mortgage Interest Rate
or Scheduled Payment in accordance
with the terms of the related Mortgage
Note, the Servicer shall deposit in the
Collection Account from its own funds the
amount of any interest loss caused as
such interest loss occurs.
Section 3.19 Access to Certain Documentation and Information
Regarding the Mortgage Loans. The Servicer
shall provide, or cause the
Subservicer to provide, to the Depositor,
the Trustee, the OTS or the FDIC and
the examiners and supervisory agents
thereof access to the documentation
regarding the Mortgage Loans in its
possession required by applicable
regulations of the OTS. Such access shall
be afforded without charge, but only
upon reasonable and prior written request
and during normal business hours at
the offices of the Servicer, the Depositor,
the Trustee or any Subservicer.
Nothing in this Section shall derogate from
the obligation of such party to
observe any applicable law prohibiting
disclosure of information regarding the
Mortgagors and the failure of such party to
provide access as provided in this
Section as a result of such obligation
shall not constitute a breach of this
Section.
Section 3.20 Documents, Records and Funds in Possession of the
Servicer to Be Held for the Trustee. The
Servicer shall account fully to the
Trustee for any funds received by the
Servicer or which otherwise are collected
by the Servicer as Liquidation Proceeds,
Condemnation Proceeds or Insurance
Proceeds in respect of any Mortgage Loan.
All Mortgage Files and funds collected
or held by, or under the control of, the
Servicer in respect of any Mortgage
Loans, whether from the collection of
principal and interest payments or from
Liquidation Proceeds, including, but not
limited to, any funds on deposit in the
Collection Account, shall be held by the
Servicer for and on behalf of the
Trustee and shall be and remain the sole
and exclusive property of the Trustee,
subject to the applicable provisions of
this Agreement. The Servicer also agrees
that it shall not create, incur or subject
any Mortgage File or any funds that
are deposited in the Collection Account,
the Distribution Account or any Escrow
Account, or any funds that otherwise are or
may become due or payable to the
Trustee for the benefit of the
Certificateholders, to any claim, lien, security
interest, judgment, levy, writ of
attachment or other encumbrance, or assert by
legal action or otherwise any claim or
right of setoff against any Mortgage File
or any funds collected on, or in connection
with, a Mortgage Loan, except,
however, that the Servicer shall be
entitled to set off against and deduct from
any such funds any amounts that are
properly due and payable to the Servicer
under this Agreement.
Section 3.21 Servicing Compensation. (a) As compensation for
its
activities hereunder, the Servicer shall,
with respect to each Mortgage Loan, be
entitled to retain from deposits to the
Collection Account and from Liquidation
Proceeds, Insurance Proceeds and
Condemnation Proceeds related to such Mortgage
Loan, the Servicing Fee with respect to
each Mortgage Loan (less any portion of
such amounts retained by any Subservicer).
In addition, the Servicer shall be
entitled to recover unpaid Servicing Fees
out of related late collections to the
extent permitted in Section 3.11. The right
to receive the Servicing Fee may not
be transferred in whole or in part except
as provided in Section 6.06 or in
connection with the transfer of all of the
Servicer's responsibilities and
obligations under this Agreement; provided,
however, that the Servicer may pay
from the Servicing Fee any amounts due to a
Subservicer pursuant to a
Subservicing Agreement entered into under
Section 3.02.
(b) Additional servicing compensation in the form of assumption
or
modification fees, late payment charges,
NSF fees, reconveyance fees and other
similar fees and charges (other than
Prepayment Premiums) shall be retained by
the Servicer only to the extent such fees
or charges are received by the
Servicer. The Servicer shall also be
entitled pursuant to Section 3.11(a)(iv) to
withdraw from the Collection Account, as
additional servicing compensation,
interest or other income earned on deposits
therein.
(c) The Servicer shall be required to pay all expenses incurred
by
it in connection with its servicing
activities hereunder (including payment of
premiums for any blanket policy insuring
against hazard losses pursuant to
Section 3.13, servicing compensation of the
Subservicer to the extent not
retained by it and the fees and expenses of
independent accountants and any
agents appointed by the Servicer), and
shall not be entitled to reimbursement
therefor except as specifically provided in
Section 3.11.
Section 3.22 Annual Statement as to Compliance. The Servicer
will
deliver or cause to be delivered to the
Depositor, the Rating Agencies and the
Trustee on or before March 15th of each
calendar year, commencing in 2006, an
Officer's Certificate stating, as to each
signatory thereof, that (i) a review
of the activities of the Servicer during
the preceding calendar year and of
performance under this Agreement or a
similar agreement has been made under such
officers' supervision, and (ii) to the best
of such officers' knowledge, based
on such review, the Servicer has fulfilled
all of its obligations under this
Agreement throughout such year, or, if
there has been a default in the
fulfillment of any such obligation,
specifying each such default known to such
officers and the nature and status thereof.
Promptly after receipt of such
Officer's Certificate, the Depositor shall
review such Officer's Certificate
and, if applicable, consult with the
Servicer as to the nature of any defaults
by the Servicer in the fulfillment of any
of the Servicer's obligations. The
obligations of the Servicer under this
Section apply to each Servicer that
serviced during the applicable period,
whether or not such Servicer is acting as
the Servicer at the time such Officer's
Certificate is required to be delivered.
Section 3.23 Annual Independent Public Accountants' Servicing
Statement; Financial Statements. Not later
than March 15th of each calendar year
commencing in 2006, the Servicer, at its
expense, shall cause a nationally
recognized firm of independent certified
public accountants to furnish to the
Depositor, the Rating Agencies and the
Trustee a report stating that (i) it has
obtained a letter of representation
regarding certain matters from the
management of the Servicer which includes
an assertion that the Servicer has
complied with certain minimum residential
mortgage loan servicing standards,
identified in the Uniform Single
Attestation Program for Mortgage Bankers
established by the Mortgage Bankers
Association of America, with respect to the
servicing of residential mortgage loans
during the most recently completed
calendar year and (ii) on the basis of an
examination conducted by such firm in
accordance with standards established by
the American Institute of Certified
Public Accountants, such representation is
fairly stated in all material
respects, subject to such exceptions and
other qualifications that may be
appropriate. In rendering its report such
firm may rely, as to matters relating
to the direct servicing of residential
mortgage loans by Subservicers, upon
comparable reports of firms of independent
certified public accountants rendered
on the basis of examinations conducted in
accordance with the same standards
(rendered within one year of such report)
with respect to those Subservicers.
Promptly after receipt of such report, the
Depositor shall review such report
and, if applicable, consult with the
Servicer as to the nature of any defaults
by the Servicer in the fulfillment of any
of the Servicer's obligations. The
obligations of the Servicer under this
Section apply to each Servicer that
serviced during the applicable period,
whether or not such Servicer is acting as
the Servicer at the time such report is
required to be delivered.
Section 3.24 Trustee to Act as Servicer. (a) In the event that
the
Servicer shall for any reason no longer be
the Servicer hereunder (including by
reason of an Event of Default), the Trustee
or its successor, subject to the
rights of the Servicing Rights Pledgee,
shall thereupon assume all of the rights
and obligations of the Servicer hereunder
arising thereafter (except that the
Trustee shall not be (i) liable for losses
of the predecessor Servicer pursuant
to Section 3.10 or any acts or omissions of
the predecessor Servicer hereunder,
(ii) obligated to make Advances if it is
prohibited from doing so by applicable
law, (iii) obligated to effectuate
repurchases or substitutions of Mortgage
Loans hereunder, including but not limited
to repurchases or substitutions
pursuant to Section 2.03, (iv) responsible
for expenses of the Servicer pursuant
to Section 2.03 or (v) deemed to have made
any representations and warranties of
the Servicer hereunder). Any such
assumption shall be subject to Sections 6.06
and 7.02.
(b) Every Subservicing Agreement entered into by the Servicer
shall
contain a provision giving the successor
Servicer the option to terminate such
agreement in the event a successor Servicer
is appointed.
(c) If the Servicer shall for any reason no longer be the
Servicer
(including by reason of any Event of
Default), the Trustee (or any other
successor Servicer) may, at its option,
succeed to any rights and obligations of
the Servicer under any Subservicing
Agreement in accordance with the terms
thereof; provided, that the Trustee (or any
other successor Servicer) shall not
incur any liability or have any obligations
in its capacity as successor
Servicer under a Subservicing Agreement
arising prior to the date of such
succession unless it expressly elects to
succeed to the rights and obligations
of the Servicer thereunder; and the
Servicer shall not thereby be relieved of
any liability or obligations under the
Subservicing Agreement arising prior to
the date of such succession.
(d) The Servicer shall, upon request of the Trustee, but at the
expense of the Servicer, deliver to the
assuming party all documents and records
relating to each Subservicing Agreement (if
any) and the Mortgage Loans then
being serviced thereunder and an accounting
of amounts collected held by it and
otherwise use its best efforts to effect
the orderly and efficient transfer of
the Subservicing Agreement to the assuming
party.
Section 3.25 Compensating Interest. The Servicer shall remit to
the
Trustee on each Remittance Date an amount
from its own funds equal to
Compensating Interest payable by the
Servicer for such Remittance Date.
Section 3.26 Credit Reporting; Gramm-Leach-Bliley Act. (a) With
respect to each Mortgage Loan, the Servicer
shall fully furnish, in accordance
with the Fair Credit Reporting Act and its
implementing regulations, accurate
and complete information (e.g., favorable
and unfavorable) on the related
Mortgagor credit files to Equifax,
Experian, and TransUnion Credit Information
Company (three of the national credit
repositories), on a monthly basis.
(b) The Servicer shall comply with all provisions of the
Privacy
Laws, relating to the Mortgage Loans, the
related borrowers and any "nonpublic
personal information" (as defined in the
Privacy Laws) received by the Servicer
incidental to the performance of its
obligations under this Agreement,
including, maintaining adequate information
security procedures to protect such
nonpublic personal information and
providing all privacy notices required by the
Privacy Laws.
Section 3.27 Excess Reserve Fund Account; Distribution Account.
(a) The Trustee shall establish and maintain the Excess Reserve
Fund
Account, on behalf of the Class N and Class
X Certificateholders, to receive any
Basis Risk Payment to pay to the LIBOR
Certificateholders Basis Risk Carry
Forward Amounts.
On each Distribution Date on which there exists a Basis Risk
Carry
Forward Amount on any Class of LIBOR
Certificates, the Trustee shall (1)
withdraw from the Distribution Account and
deposit in the Excess Reserve Fund
Account, as set forth in Section
4.02(a)(iii)(H), the lesser of the Class X
Distributable Amount (to the extent
remaining after the distributions specified
in Sections 4.02(a)(iii)(A)-(G)) and the
aggregate Basis Risk Carry Forward
Amount and (2) withdraw from the Excess
Reserve Fund Account amounts necessary
to pay to such Class or Classes of
Certificates the applicable Basis Risk Carry
Forward Amounts. Such payments shall be
allocated to those Classes based upon
the amount of Basis Risk Carry Forward
Amount owed to each such Class and shall
be paid in the priority set forth in
Section 4.02(a)(iii)(I).
The Trustee shall account for the Excess Reserve Fund Account as
an
asset of a grantor trust under subpart E,
Part I of subchapter J of the Code and
not as an asset of any Trust REMIC created
pursuant to this Agreement. The
beneficial owners of the Excess Reserve
Fund Account are the Class N and Class X
Certificateholders (or a partnership, the
beneficial holders of which are the
Class N and Class X Certificates, as the
case may be). For all federal income
tax purposes, amounts transferred by the
Class X REMIC to the Excess Reserve
Fund Account shall be treated as
distributions by the Trustee, for federal
income tax purposes, in respect of the
Class X/N Regular Interest from the Class
X REMIC to the Class N and Class X
Certificateholders (or to a partnership, the
beneficial holders of which are the Class N
and Class X Certificates, as the
case may be).
Any Basis Risk Carry Forward Amounts distributed by the Trustee
to
the LIBOR Certificateholders shall be
accounted for by the Trustee as amounts
paid first to the Holders of the Class N
and Class X Certificates (or a
partnership, the beneficial holders of
which are the Class N and Class X
Certificates, as the case may be) (as
recipient of 100% of amounts payable in
respect of the Class X/N Regular Interest)
and then to the respective Class or
Classes of LIBOR Certificates. In addition,
the Trustee shall account for the
rights of Holders of each Class of LIBOR
Certificates to receive payments of
Basis Risk Carry Forward Amounts as rights
in a separate limited recourse
interest rate cap contract written by the
Class N and Class X Certificateholders
(or such partnership) in favor of Holders
of each such Class.
Notwithstanding any provision contained in this Agreement, the
Trustee shall not be required to make any
payments from the Excess Reserve Fund
Account except as expressly set forth in
this Section 3.27(a).
(b) The Trustee shall establish and maintain the Distribution
Account on behalf of the
Certificateholders. The Trustee shall, promptly upon
receipt on the Business Day received,
deposit in the Distribution Account and
retain therein the following:
(i) the aggregate amount remitted by the Servicer to the
Trustee
pursuant
to Section 3.11;
(ii) any amount deposited by the Servicer pursuant to Section
3.12(b) in
connection with an
