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Exhibit 4.1
CHASE MORTGAGE FINANCE CORPORATION,
DEPOSITOR,
JPMORGAN CHASE BANK, N.A.,
SERVICER
and
[TRUSTEE],
TRUSTEE
POOLING AND SERVICING AGREEMENT
Dated as of [DATE]
$--------------
Multi-Class Mortgage Pass-Through Certificates
Series [_______]
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TABLE OF CONTENTS
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Page
ARTICLE I
DEFINITIONS....................................................................................1
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; TRUST
FUND......................................................24
Section 2.01.
Conveyance of Mortgage
Loans.....................................................24
Section 2.02.
Acceptance by
Trustee............................................................28
Section 2.03.
Trust Fund; Authentication of
Certificates.......................................29
Section 2.04.
REMIC
Election...................................................................30
Section 2.05.
Permitted Activities of
Trust....................................................31
Section 2.06.
Qualifying Special Purpose
Entity................................................31
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR AND THE SERVICER; REPURCHASE OF
MORTGAGE
LOANS................................................................................31
Section 3.01.
Representations and Warranties of the Depositor with respect to
the
Mortgage
Loans...................................................................31
Section 3.02.
Representations and Warranties of the
Servicer...................................32
Section 3.03.
Option to
Substitute.............................................................33
ARTICLE IV
THE
CERTIFICATES..............................................................................34
Section 4.01.
The
Certificates.................................................................34
Section 4.02.
Registration of Transfer and Exchange of
Certificates............................35
Section 4.03.
Mutilated, Destroyed, Lost or Stolen
Certificates................................38
Section 4.04.
Persons Deemed
Owners............................................................39
Section 4.05.
Appointment of Paying Agent and Certificate Registrar; Certificate
Account.......39
Section 4.06.
Authenticating
Agents............................................................40
ARTICLE V
ADMINISTRATION AND SERVICING OF MORTGAGE
LOANS................................................41
Section 5.01.
Servicer to Service Mortgage
Loans...............................................41
Section 5.02.
Sub-Servicing Agreements Between Servicer and Sub-Servicers;
Enforcement
of Sub-Servicer's
Obligations....................................................42
Section 5.03.
Successor
Sub-Servicers..........................................................42
Section 5.04.
Liability of the
Servicer........................................................42
Section 5.05.
No Contractual Relationship Between Sub-Servicer and Trustee or
Certificateholders...............................................................42
Section 5.06.
Termination of Sub-Servicing
Agreement...........................................43
Section 5.07.
Collection of Mortgage Loan
Payments.............................................43
Section 5.08.
Establishment of Collection Account; Deposit in Collection
Account...............43
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Section 5.09.
Permitted Withdrawals from the Collection
Account................................44
Section 5.10.
Establishment of Escrow Account; Deposits in Escrow
Account......................45
Section 5.11.
Permitted Withdrawals from Escrow
Account........................................45
Section 5.12.
Payment of Taxes, Insurance and Other
Charges....................................46
Section 5.13.
Transfer of
Accounts.............................................................46
Section 5.14.
[Reserved].......................................................................46
Section 5.15.
Maintenance of the Primary Insurance
Policies....................................46
Section 5.16.
Maintenance of Standard Hazard
Policies..........................................46
Section 5.17.
[Reserved].......................................................................47
Section 5.18.
[Reserved].......................................................................47
Section 5.19.
Fidelity Bond and Errors and Omissions
Insurance.................................47
Section 5.20.
Collections under Insurance Policies; Enforcement of Due-On-Sale
Clauses;
Assumption
Agreements............................................................48
Section 5.21.
Income and Realization from Defaulted Mortgage
Loans.............................48
Section 5.22.
Trustee to Cooperate; Release of Mortgage
Files..................................50
Section 5.23.
Servicing and Other
Compensation.................................................51
Section 5.24.
Reports..........................................................................51
Section 5.25.
Annual Statement as to Compliance; Notification as to Certain
Events.............51
Section 5.26.
Annual Independent Public Accountants' Servicing
Report..........................52
Section 5.27.
Access to Certain Documentation; Rights of the Depositor in Respect
of
the
Servicer.....................................................................52
Section 5.28.
REMIC-Related
Covenants..........................................................52
ARTICLE VI
PAYMENTS TO THE
CERTIFICATEHOLDERS............................................................54
Section 6.01.
Distributions....................................................................54
Section 6.02.
Statements to the
Certificateholders.............................................57
Section 6.03.
Advances by the
Servicer.........................................................58
Section 6.04.
Allocation of Realized
Losses....................................................59
Section 6.05.
Compensating Interest; Allocation of Certain Interest
Shortfalls.................60
Section 6.06.
Subordination....................................................................60
ARTICLE VII
REPORTS TO BE PREPARED BY THE
SERVICER........................................................61
Section 7.01.
Servicer Shall Provide Information as Reasonably
Required........................61
Section 7.02.
Federal Information Returns and Reports to
Certificateholders....................61
ARTICLE VIII THE
DEPOSITOR AND THE
SERVICER................................................................62
Section 8.01.
Indemnification; Third Party
Claims..............................................62
Section 8.02.
Merger or Consolidation of the Depositor or the
Servicer.........................63
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Section 8.03.
Limitation on Liability of the Depositor, the Servicer, the Trustee
and
Others...........................................................................63
Section 8.04.
Depositor and Servicer Not to
Resign.............................................64
Section 8.05.
Successor to the
Servicer........................................................64
Section 8.06.
Maintenance of
Ratings...........................................................65
ARTICLE IX
DEFAULT.......................................................................................65
Section 9.01.
Events of
Default................................................................65
Section 9.02.
Waiver of
Defaults...............................................................66
Section 9.03.
Trustee to Act; Appointment of
Successor.........................................67
Section 9.04.
Notification to Certificateholders and the Rating
Agencies.......................67
ARTICLE X
CONCERNING THE
TRUSTEE........................................................................67
Section 10.01.
Duties of
Trustee................................................................67
Section 10.02.
Certain Matters Affecting the
Trustee............................................68
Section 10.03.
Trustee Not Liable for Certificates or Mortgage
Loans............................69
Section 10.04.
Trustee May Own
Certificates.....................................................69
Section 10.05.
Fees and
Expenses................................................................69
Section 10.06.
Eligibility Requirements for
Trustee.............................................69
Section 10.07.
Resignation and Removal of the
Trustee...........................................70
Section 10.08.
Successor
Trustee................................................................70
Section 10.09.
Merger or Consolidation of
Trustee...............................................71
Section 10.10.
Appointment of Co-Trustee or Separate
Trustee....................................72
Section 10.11.
Appointment of Office or
Agency..................................................72
ARTICLE XI
TERMINATION...................................................................................72
Section 11.01.
Termination......................................................................72
ARTICLE XII
MISCELLANEOUS
PROVISIONS......................................................................74
Section 12.01.
Severability of
Provisions.......................................................74
Section 12.02.
Limitation on Rights of
Certificateholders.......................................74
Section 12.03.
Amendment........................................................................74
Section 12.04.
Counterparts.....................................................................75
Section 12.05.
Duration of
Agreement............................................................75
Section 12.06.
Governing
Law....................................................................75
Section 12.07.
Notices..........................................................................75
Section 12.08.
Further
Assurances...............................................................76
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<PAGE>
EXHIBIT A MORTGAGE LOAN SCHEDULE
EXHIBIT B CONTENTS OF MORTGAGE
FILE
EXHIBIT C FORM OF CLASS A
CERTIFICATES
EXHIBIT D FORM OF CLASS M
CERTIFICATE
EXHIBIT E FORM OF CLASS B
CERTIFICATES
EXHIBIT F FORM OF CLASS A-R
CERTIFICATE
EXHIBIT G FORM OF TRUSTEE
CERTIFICATION
EXHIBIT H FORM OF INVESTMENT
LETTER
EXHIBIT I FORM OF RULE 144A INVESTMENT
LETTER
EXHIBIT J FORM OF SPECIAL SERVICING
AND COLLATERAL FUND AGREEMENT
EXHIBIT K FORM OF CLASS A-R TRANSFEREE
LETTER
EXHIBIT L REQUEST FOR RELEASE OF
DOCUMENTS
EXHIBIT M TRANSFEREE ERISA
REPRESENTATION LETTER
EXHIBIT N FORM OF OFFICER'S
CERTIFICATE (SERVICER)
EXHIBIT O FORM OF OFFICER'S
CERTIFICATE (PAYING AGENT)
<PAGE>
This Pooling and Servicing Agreement, dated as of [DATE] is
executed
among Chase Mortgage Finance Corporation,
as depositor (together with its
permitted successors and assigns, the
"Depositor"), JPMorgan Chase Bank, N.A.,
as servicer (together with its permitted
successors and assigns, the "Servicer")
and [TRUSTEE], as trustee (together with
its permitted successors and assigns,
the "Trustee").
In consideration of the premises and the mutual agreements
hereinafter
set forth, the Depositor, the Servicer and
the Trustee agree as follows:
ARTICLE I
DEFINITIONS
Whenever used herein, 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 (including
collection procedures) of prudent
mortgage banking institutions which service
mortgage loans of the same type as
such Mortgage Loan in the jurisdiction
where the related Mortgaged Property (or
Underlying Mortgaged Property, in the case
of a Co-op Loan), is located, and
which are in accordance with FNMA servicing
practices and procedures for MBS
pool mortgages (as defined in the FNMA
Guides, including future updates).
ADVANCE: The aggregate of the advances made by the Servicer
with
respect to a particular Distribution Date
pursuant to Section 6.03.
AFFILIATE: With respect to any specified Person, any other
Person
controlling, controlled by or under common
control with such Person. For the
purposes of this definition, "control"
means the power to direct the management
and policies of a Person, directly or
indirectly, whether through ownership of
voting securities, by contract or
otherwise; and the terms "controlling" and
"controlled" have meanings correlative to
the foregoing.
AGENCY & TRUST OFFICE: The principal office of the Trustee at
which at
any particular time its corporate trust
business shall be administered, which
office at the date of execution of this
instrument is located at [ADDRESS].
AGGREGATE CLASS A INTEREST ACCRUAL AMOUNT: On any Distribution
Date, an
amount equal to the sum of the Class A-1
Interest Accrual Amount, the Class A-2
Interest Accrual Amount, the Class A-3
Interest Accrual Amount, the Class A-4
Interest Accrual Amount, the Class A-R
Interest Accrual Amount and the Class A-X
Interest Accrual Amount.
AGGREGATE CLASS A INTEREST SHORTFALL: On any Distribution Date,
an
amount equal to the sum of the Class A-1
Shortfall, the Class A-2 Shortfall, the
Class A-3 Shortfall, the Class A-4
Shortfall, the Class A-R Shortfall and the
Class A-X Shortfall.
AGREEMENT: This Pooling and Servicing Agreement and all
amendments
hereof and supplements hereto.
APPRAISED VALUE: The value set forth in an appraisal or
recertification
document made in connection with the
origination of the related Mortgage Loan as
the value of the Mortgaged Property (or the
related residential dwelling unit in
the Underlying Mortgaged Property, in the
case of a Co-op Loan).
<PAGE>
ASSIGNMENT OF MORTGAGE: An assignment of the Mortgage, notice
of
transfer (or UCC-3 assignment (or
equivalent instrument) with respect to each
Co-op Loan) or equivalent instrument, in
recordable form (except in the case of
a Co-op Loan), sufficient under the laws of
the jurisdiction where the related
Mortgaged Property (or Underlying Mortgaged
Property, in the case of a Co-op
Loan), is located to reflect of record the
sale and assignment of the Mortgage
Loan to the Trustee, which assignment,
notice of transfer or equivalent
instrument may, if permitted by law, be in
the form of one or more blanket
assignments covering Mortgages secured by
Mortgaged Properties located in the
same county.
AUTHENTICATING AGENT:
The meaning specified in Section 4.06.
AVAILABLE DISTRIBUTION AMOUNT: On any Distribution Date, an
amount
equal to the amount on deposit in the
Collection Account as of the close of
business on the Business Day immediately
preceding the related Distribution Date
except:
(a) amounts received on particular Mortgage Loans as late
payments or other recoveries of principal or interest
(including
Liquidation Proceeds, Insurance Proceeds and condemnation awards)
and
respecting which the Servicer previously made an unreimbursed
Advance
of such amounts;
(b) reimbursement for Nonrecoverable Advances and other
amounts permitted to be withdrawn by the Servicer pursuant to
Section
5.09 from, or not required to be deposited in, the Collection
Account;
(c) amounts representing the Servicing Fee with respect to
such Distribution Date;
(d) amounts representing all or part of a Monthly Payment due
(i) after the related Due Period or (ii) on or prior to the
Cut-off
Date;
(e) all Repurchase Proceeds, Principal Prepayments,
Liquidation Proceeds, Insurance Proceeds and condemnation awards
with
respect to Mortgage Loans received after the related Principal
Prepayment Period, and all related payments of interest
representing
interest for any period of time after the last day of the related
Due
Period for such Mortgage Loans; and
(f) all income from Eligible Investments held in the
Collection Account for the account of the Servicer.
BANKRUPTCY AMOUNT: As of any date of determination, $__________
minus
all Bankruptcy Losses on the Mortgage
Loans, if any, previously allocated to the
Certificates in accordance with Section
6.04.
BANKRUPTCY CODE: Title 11 of the United States Code, as the same
may be
amended from time to time.
BANKRUPTCY LOSS: With
respect to any Mortgage Loan, a Realized Loss
resulting from a Deficient Valuation or
Debt Service Reduction.
BENEFICIAL HOLDERS: A Person holding a beneficial interest in
any
Book-Entry Certificate through a
Participant or an Indirect Participant or a
Person holding a beneficial interest in any
Definitive Certificate.
2
<PAGE>
BOOK-ENTRY CERTIFICATES: The Class A Certificates (other than the
Class
A-R and Class A-X Certificates), Class M
Certificates, Class B-1 Certificates,
and Class B-2 Certificates, referred to
collectively.
BUSINESS DAY: Any day other than (a) a Saturday or Sunday, (b) a
legal
holiday in the State of New York or (c) a
day on which banking institutions in
the State of New York are authorized or
obligated by law or executive order to
be closed.
CARRY-OVER SUBORDINATED PRINCIPAL AMOUNT: As of any Distribution
Date,
with respect to any Class of Subordinated
Certificates, an amount, if any, equal
to the amount of principal distributable to
such Class on any prior Distribution
Date that has not been so distributed.
CASH LIQUIDATION: Recovery of all cash proceeds by the Servicer
with
respect to the liquidation of any Mortgage
Loan, including Insurance Proceeds
and other payments or recoveries (whether
made at one time or over a period of
time) which the Servicer deems to be
finally recoverable, in connection with the
sale, assignment or satisfaction of such
Mortgage Loan, trustee's sale,
foreclosure sale or otherwise, but only if
title to the related Mortgaged
Property (or stock allocated to a dwelling
unit, in the case of a Co-op Loan)
was not acquired by foreclosure or deed in
lieu of foreclosure by the Servicer
pursuant to Section 5.21.
CERTIFICATE: Any Class
A, Class M or Class B Certificate.
CERTIFICATE ACCOUNT: The account created and maintained pursuant
to
Section 4.05.
CERTIFICATEHOLDER or HOLDER: The Person in whose name a Certificate
is
registered in the Certificate Register,
except that, solely for the purposes of
giving any consent, waiver, request or
demand pursuant to this Agreement, any
Certificate registered in the name of the
Depositor, the Servicer, any
Sub-Servicer, or any of their respective
Affiliates shall be disregarded and the
undivided Percentage Interest evidenced
thereby shall not be taken into account
in determining whether the requisite amount
of Percentage Interests necessary to
effect any such consent, waiver, request or
demand has been obtained. The
Trustee shall be entitled to conclusively
rely upon the certificate of the
Depositor or the Servicer as to the
determination of which Certificates are
registered in the name of such
Affiliates.
CERTIFICATE OWNER: Any Person who is the beneficial owner of a
Book-Entry Certificate registered in the
name of the Depository or its nominee.
CERTIFICATE RATE: The per annum rate of interest borne by each
Class of
Certificates (other than the [Class ___,
Class ___,] Class A-X and Class A-P
Certificates), which rate shall equal ____%
with respect to the Class A-1, Class
A-2, Class A-3, Class A-4, Class A-R, Class
M, Class B-1, Class B-2, Class B-3,
Class B-4 and Class B-5 Certificates, in
each case on the Outstanding
Certificate Principal Balance of each
Class. [In the case of the Class ___
Certificates, the Certificate Rate shall
equal _____% with respect to the [DATE]
Distribution Date, and with respect to any
Distribution Date thereafter, the
Certificate Rate with respect to the Class
___ Certificates shall equal the
lesser of (i) ____% plus LIBOR and (ii)
_____%. In the case of the Class ___
Certificates, the Certificate Rate shall
equal _______% with respect to the
[DATE] Distribution Date, and with respect
to any Distribution Date thereafter,
the Certificate Rate with respect to the
Class ___ Certificates shall equal
____% minus the product of (i) 3.000 and
(ii) LIBOR, but not less than _____%.]
In the case of the Class A-X Certificates,
the Certificate Rate shall equal,
with respect to any Distribution Date, the
weighted average, expressed as a
percentage, of the Stripped Interest Rate
on each Non-Discount Mortgage Loan
having a Stripped Interest Rate exceeding
zero as of the Due Date in the month
immediately preceding the month in which
such Distribution Date occurs, weighted
on the basis of the respective Principal
Balances of the Non-Discount Mortgage
Loans, which Principal Balances shall be
the Principal Balances of the
Non-Discount Mortgage Loans at the close of
business on the immediately
preceding Distribution Date after giving
effect to distributions thereon
allocable to principal (or, in the case of
the Certificate Rate for the initial
Distribution Date, at the close of business
on the Cut-off Date). With respect
to any Distribution Date, (i) interest will
accrue on each Class of Certificates
from the first day of the calendar month
preceding the month in which such
Distribution Date occurs through the last
day of the month preceding the month
in which such Distribution Date occurs;
provided, however with respect to the
[DATE] Distribution Date, interest will
accrue on the Class ____ and Class ____
Certificates from [DATE] through [DATE]).
Interest with respect to each Class of
Certificates (other than the Class A-P
Certificates) at the Certificate Rate
shall be calculated based on a year of 360
days comprised of twelve 30-day
months.
3
<PAGE>
CERTIFICATE REGISTER: The register maintained pursuant to Section
4.02.
CERTIFICATE REGISTRAR. The Person appointed by the Trustee as
Certificate Registrar pursuant to Section
4.05.
CHASE: JPMorgan Chase Bank, a New York State banking corporation,
or
its successor in interest.
CHF: Chase Home Finance LLC, a Delaware limited liability company,
or
its successor in interest.
CLASS: Pertaining to the Class A-1, Class A-2, Class A-3, Class
A-4,
Class A-P, Class A-R, Class A-X, Class M,
Class B-1, Class B-2, Class B-3, Class
B-4 or Class B-5 Certificates, as the case
may be.
CLASS A, CLASS M OR CLASS B: Pertaining to Class A Certificates,
Class
M Certificates or Class B Certificates, as
the case may be.
CLASS A-P AMOUNT: With respect to any Distribution Date, the
applicable
PO Percentage of (i) all principal received
on or in respect of each Discount
Mortgage Loan (exclusive of any amounts in
respect of any Monthly Payment)
during the related Principal Prepayment
Period and (ii) all principal received
as part of a Monthly Payment on or in
respect of a Discount Mortgage Loan during
the related Due Period.
CLASS A CERTIFICATES: The Class A-1, Class A-2, Class A-3, Class
A-4,
Class A-P, Class A-R and Class A-X
Certificates, referred to collectively.
CLASS A-1 CERTIFICATE: Any one of the Class A-1 Certificates,
executed
by the Depositor and authenticated by the
Trustee, senior in right of payment to
the Class M and Class B Certificates,
substantially in the form of the Class A
Certificate set forth in Exhibit C
hereto.
CLASS A-2 CERTIFICATE: Any one of the Class A-2 Certificates,
executed
by the Depositor and authenticated by the
Trustee, senior in right of payment to
the Class M and Class B Certificates,
substantially in the form of the Class A
Certificate set forth in Exhibit C
hereto.
CLASS A-3 CERTIFICATE: Any one of the Class A-3 Certificates,
executed
by the Depositor and authenticated by the
Trustee, senior in right of payment to
the Class M and Class B Certificates,
substantially in the form of the Class A
Certificate set forth in Exhibit C
hereto.
CLASS A-4 CERTIFICATE: Any one of the Class A-4 Certificates,
executed
by the Depositor and authenticated by the
Trustee, senior in right of payment to
the Class M and Class B Certificates,
substantially in the form of the Class A
Certificate set forth in Exhibit C
hereto.
4
<PAGE>
CLASS A-P CERTIFICATE: Any one of the Class A-P Certificates,
executed
by the Depositor and authenticated by the
Trustee, senior in right of payment to
the Class M and Class B Certificates,
substantially in the form of the Class A
Certificate set forth in Exhibit C
hereto.
CLASS A-R CERTIFICATE: The Class A-R Certificate executed by
the
Depositor and authenticated by the Trustee,
senior in right of payment to the
Class M and Class B Certificates and
representing the Residual Interest,
substantially in the form of the Class A-R
Certificate set forth in Exhibit F
hereto.
CLASS A-X CERTIFICATE: Any one of the Class A-X Certificates
executed
by the Depositor and authenticated by the
Trustee, senior in right of payment to
the Class M and Class B Certificates,
substantially in the form of the Class A
Certificate set forth in Exhibit C
hereto.
CLASS A-1 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-1 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-1 Certificates on such
Distribution Date pursuant to Section
6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess
Loss allocated to the Class A-1
Certificates on such Distribution Date
pursuant to Section 6.05(c).
CLASS A-2 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-2 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-2 Certificates on such
Distribution Date pursuant to Section
6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess
Loss allocated to the Class A-2
Certificates on such Distribution Date
pursuant to Section 6.05(c).
CLASS A-3 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-3 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-3 Certificates on such
Distribution Date pursuant to Section
6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess
Loss allocated to the Class A-3
Certificates on such Distribution Date
pursuant to Section 6.05(c).
CLASS A-4 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-4 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-4 Certificates on such
Distribution Date pursuant to Section
6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess
Loss allocated to the Class A-4
Certificates on such Distribution Date
pursuant to Section 6.05(c).
CLASS A-R INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-R Certificate minus (i) any
Compensating Interest Shortfall allocated
to the Class A-R Certificate on such
Distribution Date pursuant to Section
6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess
Loss allocated to the Class A-R
Certificate on such Distribution Date
pursuant to Section 6.05(c).
CLASS A-X INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Class A-X Notional
Amount minus (i) any Compensating Interest
Shortfall allocated to the Class A-X
Certificates on such Distribution Date
pursuant to Section 6.05(b) and (ii) any
Realized Loss Interest Shortfall resulting
from an Excess Loss allocated to the
Class A-X Certificates on such Distribution
Date pursuant to Section 6.05(c).
5
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CLASS A-X NOTIONAL AMOUNT: With respect to any Distribution Date,
an
amount equal to the aggregate Scheduled
Principal Balance of the Non-Discount
Mortgage Loans.
CLASS A PERCENTAGE: As of any Distribution Date, the percentage
obtained by dividing the Class A Principal
Balance by the Mortgage Pool
Principal Balance, but not more than
100%.
CLASS A PRINCIPAL BALANCE: As of any Distribution Date, (a) the
Class A
Principal Balance for the immediately
preceding Distribution Date less (b)
amounts distributed to the Class A
Certificateholders on such preceding
Distribution Date allocable to principal
(including the principal portion of
Advances of the Servicer made pursuant to
Section 6.03 and Realized Losses
allocated to the Class A Certificates
pursuant to Section 6.04); provided that
the Class A Principal Balance on the first
Distribution Date shall be the
Original Class A Principal Balance.
CLASS A-1 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-1 Interest Accrual Amount over the
amount actually distributed to the Class
A-1 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(A).
CLASS A-2 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-2 Interest Accrual Amount over the
amount actually distributed to the Class
A-2 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(B).
CLASS A-3 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-3 Interest Accrual Amount over the
amount actually distributed to the Class
A-3 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(C).
CLASS A-4 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-4 Interest Accrual Amount over the
amount actually distributed to the Class
A-4 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(D).
CLASS A-R SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-R Interest Accrual Amount over the
amount actually distributed to the Class
A-R Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(E).
CLASS A-X SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-X Interest Accrual Amount over the
amount actually distributed to the Class
A-X Certificates on such Distribution
Date pursuant to Section 6.01(b)(i)(F).
CLASS A-P SHORTFALL AMOUNT: With respect to any Distribution Date
prior
to and including the Credit Support
Depletion Date, to the extent of amounts
available to pay the Subordinated Optimal
Principal Amount (without regard to
clause (b)(2) of the definition of such
term), an amount equal to the sum of (i)
the applicable PO Percentage of the
principal portion of any Realized Loss
(other than an Excess Loss) with respect to
a Discount Mortgage Loan and (ii)
the sum of amounts, if any, by which the
amounts specified in clause (i) with
respect to each prior Distribution Date
exceeded the amount actually distributed
in respect thereof on such prior
Distribution Date and not subsequently
distributed to the Class A-P
Certificateholders.
CLASS B CERTIFICATES: The Class B-1, Class B-2, Class B-3, Class
B-4
and Class B-5 Certificates, referred to
collectively.
6
<PAGE>
CLASS B-1 CERTIFICATE: Any one of the Class B-1 Certificates
executed
by the Depositor and authenticated by the
Trustee, subordinated in right of
payment to the Class A and Class M
Certificates, substantially in the form of
the Class B Certificate set forth in
Exhibit E hereto.
CLASS B-2 CERTIFICATE: Any one of the Class B-2 Certificates
executed
by the Depositor and authenticated by the
Trustee, subordinated in right of
payment to the Class A, Class M and Class
B-1 Certificates, substantially in the
form of the Class B Certificate set forth
in Exhibit E hereto.
CLASS B-3 CERTIFICATE: Any one of the Class B-3 Certificates
executed
by the Depositor and authenticated by the
Trustee, subordinated in right of
payment to the Class A, Class M, Class B-1
and Class B-2 Certificates,
substantially in the form of the Class B
Certificate set forth in Exhibit E
hereto.
CLASS B-4 CERTIFICATE: Any one of the Class B-4 Certificates
executed
by the Depositor and authenticated by the
Trustee, subordinated in right of
payment to the Class A, Class M, Class B-1,
Class B-2 and Class B-3
Certificates, substantially in the form of
the Class B Certificate set forth in
Exhibit E hereto.
CLASS B-5 CERTIFICATE: Any one of the Class B-5 Certificates
executed
by the Depositor and authenticated by the
Trustee, subordinated in right of
payment to the Class A, Class M, Class B-1,
Class B-2, Class B-3 and Class B-4
Certificates, substantially in the form of
the Class B Certificate set forth in
Exhibit E hereto.
CLASS B-1 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
B-1 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class B-1 Certificates on such
Distribution Date pursuant to Section
6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess
Loss allocated to the Class B-1
Certificates on such Distribution Date
pursuant to Section 6.05(c).
CLASS B-2 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
B-2 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class B-2 Certificates on such
Distribution Date pursuant to Section
6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess
Loss allocated to the Class B-2
Certificates on such Distribution Date
pursuant to Section 6.05(c).
CLASS B-3 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
B-3 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class B-3 Certificates on such
Distribution Date pursuant to Section
6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess
Loss allocated to the Class B-3
Certificates on such Distribution Date
pursuant to Section 6.05(c).
CLASS B-4 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
B-4 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class B-4 Certificates on such
Distribution Date pursuant to Section
6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess
Loss allocated to the Class B-4
Certificates on such Distribution Date
pursuant to Section 6.05(c).
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<PAGE>
CLASS B-5 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
B-5 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class B-5 Certificates on such
Distribution Date pursuant to Section
6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess
Loss allocated to the Class B-5
Certificates on such Distribution Date
pursuant to Section 6.05(c).
CLASS B-1 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
B-1 Interest Accrual Amount over the
amount actually distributed to the Class
B-1 Certificates on such Distribution
Date pursuant to Section 6.01(d)(1) (A) and
(B).
CLASS B-2 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
B-2 Interest Accrual Amount over the
amount actually distributed to the Class
B-2 Certificates on such Distribution
Date pursuant to Section 6.01(d)(2) (A) and
(B).
CLASS B-3 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
B-3 Interest Accrual Amount over the
amount actually distributed to the Class
B-3 Certificates on such Distribution
Date pursuant to Section 6.01(d)(3) (A) and
(B).
CLASS B-4 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
B-4 Interest Accrual Amount over the
amount actually distributed to the Class
B-4 Certificates on such Distribution
Date pursuant to Section 6.01(d)(4) (A) and
(B).
CLASS B-5
SHORTFALL: With respect to any Distribution Date, the amount
equal to the excess, if any, of the Class
B-5 Interest Accrual Amount over the
amount actually distributed to the Class
B-5 Certificates on such Distribution
Date pursuant to Section 6.01(d)(5) (A) and
(B).
CLASS B PERCENTAGE: As of any Distribution Date, the difference
between
100% and the sum of (i) the Class A
Percentage and (ii) the Class M Percentage
for such Distribution Date.
CLASS B PRINCIPAL BALANCE: As of any Distribution Date, the excess
of
the Mortgage Pool Principal Balance
(together with the principal portion of any
Monthly Payment due but not paid with
respect to which an Advance has not been
made) over the sum of (i) the Class A
Principal Balance and (ii) the Class M
Principal Balance.
CLASS M CERTIFICATE: Any one of the Class M Certificates executed
by
the Depositor and authenticated by the
Trustee, subordinated in right of payment
to the Class A Certificates, substantially
in the form of the Class M
Certificate set forth in Exhibit D
hereto.
CLASS M INTEREST ACCRUAL AMOUNT: With respect to any Distribution
Date,
one month's interest at the Certificate
Rate on the Outstanding Certificate
Principal Balance of the Class M
Certificates minus (i) any Compensating
Interest Shortfall allocated to the Class M
Certificates on such Distribution
Date pursuant to Section 6.05(b) and (ii)
any Realized Loss Interest Shortfall
resulting from an Excess Loss allocated to
the Class M Certificates on such
Distribution Date pursuant to Section
6.05(c).
CLASS M PERCENTAGE: As of any Distribution Date, the percentage
obtained by dividing the Class M Principal
Balance by the Mortgage Pool
Principal Balance, but not more than 100%;
provided, however, that on any
Distribution Date on which the Class B
Percentage equals 0%, the Class M
Percentage shall equal 100% minus the Class
A Percentage.
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<PAGE>
CLASS M PRINCIPAL BALANCE: As of any Distribution Date, (a) the
Class M
Principal Balance for the immediately
preceding Distribution Date less (b)
amounts distributed to the Class M
Certificateholders on such preceding
Distribution Date allocable to principal
(including the principal portion of
Advances of the Servicer made pursuant to
Section 6.03 and Realized Losses
allocated to the Class M Certificates
pursuant to Section 6.04); provided that
the Class M Principal Balance on the first
Distribution Date shall be the
Original Class M Principal Balance, and
provided further that if the aggregate
Outstanding Certificate Principal Balance
of the Class B Certificates has been
reduced to zero, as of any Distribution
Date, the Class M Principal Balance will
equal the excess of the Mortgage Pool
Principal Balance (together with the
portion of any Monthly Payment due but not
paid with respect to which an Advance
has not been made) over the Class A
Principal Balance.
CLASS M SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class M
Interest Accrual Amount over the
amount actually distributed to the Class M
Certificateholders on such
Distribution Date pursuant to Section
6.01(c)(A) and (B).
CLOSING DATE: [DATE].
CODE: The Internal Revenue Code of 1986, as amended from time to
time,
and any successor statutes thereto, and
applicable U.S. Department of Treasury
temporary or final regulations promulgated
thereunder.
COLLECTION ACCOUNT: The account created and maintained pursuant
to
Section 5.08.
COMPENSATING INTEREST: The meaning specified in Section
6.05(a).
COMPENSATING INTEREST SHORTFALL: The meaning specified in
Section
6.05(b).
CO-OP LEASE: With respect to a Co-op Loan, the lease with respect
to a
dwelling unit occupied by the Mortgagor and
relating to the stock allocated to
the related dwelling unit.
CO-OP LOAN: A Mortgage Loan secured by the pledge of stock
allocated to
a dwelling unit in a residential
cooperative housing corporation and a
collateral assignment of the related Co-op
Lease.
CREDIT SUPPORT: With respect to each Class of Subordinated
Certificates
(other than the Class B-5 Certificates),
the level of credit support supporting
such Class, expressed as a percentage of
the aggregate Outstanding Certificate
Principal Balance of all Classes of
Certificates (other than the Class A-P
Certificates). With respect to each
Distribution Date, Credit Support for each
such Class will equal in each case the
percentage, rounded to two decimal
places, obtained by dividing the aggregate
Outstanding Certificate Principal
Balances immediately prior to such
Distribution Date of all Classes of
Subordinated Certificates having higher
numerical class designations than such
Class (for this purpose, the Class M
Certificates shall be deemed to have a
lower numerical class designation than each
Class of Class B Certificates) by
the aggregate Outstanding Certificate
Principal Balance of all Classes of
Certificates (other than the Class A-P
Certificates) immediately prior to such
Distribution Date.
CREDIT SUPPORT DEPLETION DATE: The first Distribution Date on which
the
aggregate Outstanding Certificate Principal
Balance of the Subordinated
Certificates has been or will be reduced to
zero.
CUT-OFF DATE:
[DATE].
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<PAGE>
DEBT SERVICE REDUCTION: With respect to any Mortgage Loan, a
reduction
in the scheduled Monthly Payment for such
Mortgage Loan by a court of competent
jurisdiction in a proceeding under the
Bankruptcy Code, other than such a
reduction resulting from a Deficient
Valuation.
DEFICIENT VALUATION: With respect to any Mortgage Loan, a valuation
of
the related Mortgaged Property (or stock
allocated to a dwelling unit, in the
case of a Co-op Loan) 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 Bankruptcy Code.
DEFINITIVE CERTIFICATES: The Certificates referred to in
Section
4.01(c).
DEPOSITOR: Chase Mortgage Finance Corporation, a Delaware
corporation,
or its successor in interest or any
successor under this Agreement appointed as
herein provided.
DEPOSITORY: The Depository Trust Company, the nominee of which is
Cede
& Co.
DEPOSITORY AGREEMENT: The agreement referred to in Section
4.01(b).
DEPOSITORY PARTICIPANT: A broker, dealer, bank or other
financial
institution or other Person for whom from
time to time the Depository effects
book-entry transfers and pledges of
securities deposited with the Depository.
DETERMINATION DATE: The sixteenth day of the month in which the
related
Distribution Date occurs (or, if such
sixteenth day is not a Business Day, the
preceding Business Day).
DISCOUNT MORTGAGE LOAN: Any Mortgage Loan having a Net Mortgage
Rate
less than the Remittance Rate.
DISQUALIFIED ORGANIZATION: An organization referred to in
section
860E(e)(5) of the Code.
DISTRIBUTION DATE: The 25th day of any month, or if such 25th day
is
not a Business Day, the first Business Day
immediately following, beginning with
[DATE].
DUE DATE: The first day of each month, being the day of the month
on
which each Monthly Payment is due on a
Mortgage Loan, exclusive of any days of
grace.
DUE PERIOD: With respect to any Distribution Date, the period from
the
second day of the month preceding the month
in which such Distribution Date
occurs through the first day of the month
in which such Distribution Date
occurs.
ELIGIBLE ACCOUNT: An account that is (i) maintained with a
depository
institution the long-term unsecured debt
obligations of which are rated by each
Rating Agency in one of its two highest
rating categories, or (ii) maintained
with the corporate trust department of a
national bank or banking corporation
which (a) has a rating of at least Baa3 or
P-3 by Moody's and (b) is either
Chase or is the corporate trust department
of a national bank or banking
corporation which has a rating of at least
A- or F1 by Fitch, or (iii) an
account or accounts the deposits in which
are fully insured by the FDIC, or (iv)
an account or accounts in a depository
institution in which such accounts are
insured by the FDIC (to the limit
established by the FDIC), the uninsured
deposits in which accounts are otherwise
secured such that, as evidenced by an
Opinion of Counsel delivered to and
acceptable to the Trustee and each Rating
Agency, the Certificateholders have a claim
with respect to the funds in such
account and a perfected first security
interest against any collateral (which
shall be limited to Eligible Investments)
securing such funds that is superior
to claims of any other depositors or
creditors of the depository institution
with which such account is maintained,
provided, however, that such uninsured
deposits do not result in the reduction of
the ratings assigned to the
Certificates by the Rating Agencies as
evidenced by a letter from each Rating
Agency or (v) otherwise acceptable to each
Rating Agency without reduction or
withdrawal of the rating of any Class of
Certificates, as evidenced by a letter
from each Rating Agency.
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<PAGE>
ELIGIBLE INVESTMENTS: One or more of the following:
(i) obligations of, or guaranteed as to principal and interest by,
the
United States or obligations of any agency
or instrumentality thereof when such
obligations are backed by the full faith
and credit of the United States;
provided that any such obligation held as a
"cash flow investment" within the
meaning of section 860G(a)(6) of the Code
shall not have a remaining maturity of
more than 45 days;
(ii) repurchase agreements on obligations specified in clause
(i)
maturing not more than two months from the
date of acquisition thereof, provided
that the long-term unsecured obligations of
the party agreeing to repurchase
such obligations are at the time rated by
each Rating Agency with its highest
rating and the short-term debt obligations
of the party agreeing to repurchase
are rated with one of the two highest
ratings by S&P or Moody's;
(iii) federal funds, certificates of deposit, time deposits and
bankers' acceptances (other than bankers'
acceptances issued by Chase or any of
its Affiliates) (which shall each have an
original maturity of not more than 60
days and, in the case of bankers'
acceptances, shall in no event have an
original maturity of more than 365 days) of
any United States depository
institution or trust company incorporated
under the laws of the United States or
any state, provided that the long-term
unsecured debt obligations of such
depository institution or trust company at
the date of acquisition thereof have
been rated by each Rating Agency with its
highest rating and the short-term
obligations of such depository institution
or trust company are rated A-1+ by
S&P and P-1 by Moody's;
(iv) commercial paper (other than commercial paper issued by Chase
or
any of its Affiliates) (having original
maturities of not more than 365 days) of
any corporation incorporated under the laws
of the United States or any state
thereof which on the date of acquisition
has been rated by each Rating Agency in
its highest short-term unsecured commercial
paper rating category; provided that
such commercial paper shall have a
remaining maturity of not more than 45 days;
(v) units of taxable money market funds (including those for which
the
Trustee or the Servicer or any Affiliate
thereof receives compensation with
respect to such investment) which funds
have been rated by each Rating Agency in
its highest rating category or which have
been designated in writing by each
Rating Agency as Eligible Investments with
respect to this definition;
(vi) other obligations or securities (other than investments or
obligations of Chase or any of its
Affiliates) that are "permitted investments"
within the meaning of Section 860G(a)(5) of
the Code and acceptable to each
Rating Agency rating the Certificates as an
Eligible Investment hereunder and
will not result in a reduction or
withdrawal in the then current rating of any
Class of Certificates, as evidenced by a
letter to such effect from each Rating
Agency and short term unsecured debt or
deposits of the obligor on such
investments are rated A-1 by S&P and
P-1 by Moody's.
provided that no such instrument shall be
an Eligible Investment if such
instrument evidences either (a) a right to
receive only interest payments with
respect to the obligations underlying such
instrument, or (b) both principal and
interest payments derived from obligations
underlying such instrument where the
interest and principal payments with
respect to such instrument provide a yield
to maturity of greater than 120% of the
yield to maturity at par of such
underlying obligations; and provided
further that no such instrument shall be
purchased above par.
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<PAGE>
ERISA: The Employee Retirement Income Security Act of 1974, as
amended
from time to time, and any successor
statutes thereto, and applicable U.S.
Department of Labor temporary or final
regulations promulgated thereunder.
ERISA RESTRICTED CERTIFICATE: Any Class B-3, Class B-4 or Class
B-5
Certificate or any other Certificate which
at the date of determination is not
rated in one of the four highest generic
rating categories by any Rating Agency.
ESCROW ACCOUNT: The account or accounts created and maintained
pursuant
to Section 5.10.
ESCROW PAYMENTS: The amounts constituting applicable ground
rents,
taxes, assessments, water rates, Standard
Hazard Policy premiums and other
payments required to be escrowed by the
Mortgagor with the mortgagee pursuant to
a Mortgage Loan.
EVENT OF DEFAULT: Any of the events specified in Section 9.01.
EXCEPTION REPORT: The report of the Trustee referred to in
Section
2.02.
EXCESS BANKRUPTCY LOSS: Any Bankruptcy Loss, or portion thereof,
which
exceeds the then applicable Bankruptcy
Amount.
EXCESS FRAUD LOSS: Any Fraud Loss, or portion thereof, which
exceeds
the then applicable Fraud Loss Amount.
EXCESS LOSSES: Excess Bankruptcy Losses, Excess Fraud Losses and
Excess
Special Hazard Losses, referred to
collectively.
EXCESS PROCEEDS: All amounts (net of the related Servicing
Advances)
received on any Mortgage Loan (whether as
regular principal payments, Principal
Prepayments, Repurchase Proceeds,
Liquidation Proceeds, Insurance Proceeds,
condemnation awards, or with respect to a
disposition of a Mortgaged Property
(or stock allocated to a dwelling unit, in
the case of a Co-op Loan) which has
been acquired by foreclosure or deed in
lieu of foreclosure or otherwise) in
excess of the Principal Balance at the
Cut-off Date of such Mortgage Loan and
accrued interest thereon at its Mortgage
Rate to the Due Date immediately
succeeding the date of prepayment,
repurchase or liquidation, as the case may
be.
EXCESS SPECIAL HAZARD LOSS: Any Special Hazard Loss, or portion
thereof, that exceeds the then applicable
Special Hazard Amount.
FDIC: The Federal Deposit Insurance Corporation or any
successor
organization.
FHLMC: The Federal Home Loan Mortgage Corporation or any
successor
organization.
FIDELITY BOND: A fidelity bond and errors and omissions insurance
to be
maintained by the Servicer pursuant to
Section 5.19.
FITCH: Fitch, Inc. or its successor in interest.
FNMA: The Federal National Mortgage Association, or any
successor
organization.
FNMA GUIDES: The FNMA Sellers' Guide and the FNMA Servicers' Guide,
and
all amendments or additions thereto.
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<PAGE>
FRAUD LOSS: Any Realized Loss or portion thereof sustained by
reason of
a default arising from fraud, dishonesty or
misrepresentation in connection with
the related Mortgage Loan, including by
reason of the denial of coverage under
any related Primary Insurance Policy.
FRAUD LOSS AMOUNT: As of any date of determination after the
Cut-off
Date, an amount equal to: (X) prior to the
first anniversary of the Cut-off
Date, ____% (initially, $____________) of
the aggregate outstanding principal
balance of all of the Mortgage Loans as of
the Cut-off Date minus the aggregate
amount of Fraud Loss on the Mortgage Loans
allocated to the Certificates in
accordance with Section 6.04 since the
Cut-off Date up to such date of
determination and (Y) from the first to the
fifth anniversary of the Cut-off
Date, (1) ____% of the aggregate
outstanding principal balance of all of the
Mortgage Loans as of the most recent
anniversary of the Cut-off Date minus (2)
the Fraud Losses allocated to the
Certificates in accordance with Section 6.04
since the most recent anniversary of the
Cut-off Date up to such date of
determination. On and after the fifth
anniversary of the Cut-off Date, the Fraud
Loss Amount shall be zero.
INDIRECT PARTICIPANT: A broker, dealer, bank or other financial
institution or other Person that clears
through or maintains a custodial
relationship with a Depository Participant,
either directly or indirectly.
INSURANCE PROCEEDS: Proceeds paid by any insurer pursuant to
any
insurance policy covering a Mortgage Loan,
net of costs of collecting such
proceeds and net of amounts released to the
Mortgagor or applied to the
restoration of the Mortgaged Property (or
the underlying Mortgaged Property, in
the case of a Co-op Loan).
INSURED EXPENSES: Expenses covered by any insurance policy.
INTEREST ACCRUAL PERIOD: With respect to any Distribution Date and
any
Class of Certificates (other than the Class
A-P Certificates), the calendar
month immediately preceding the month in
which the related Distribution Date
occurs.
LATE COLLECTIONS: With respect to any Mortgage Loan, all
amounts
received during any Due Period, whether as
late payments of Monthly Payments or
as Liquidation Proceeds, condemnation
proceeds, Insurance Proceeds, or with
respect to a disposition of a Mortgaged
Property (or stock allocated to a
dwelling unit, in the case of a Co-op Loan)
which has been acquired by
foreclosure or deed in lieu of foreclosure
or otherwise, which represent late
payments or collections of Monthly Payments
due but delinquent for a previous
Due Period and not previously
recovered.
[LIBOR: With respect to any Distribution Date and the Certificate
Rates
on the Class ___ and Class ___
Certificates, LIBOR as determined in accordance
with Section 6.07.]
[LIBOR BUSINESS DAY: Any day other than (i) a Saturday or a Sunday
or
(ii) a day on which banking institutions in
the city of London, England are
required or authorized by law to be
closed.]
LIQUIDATED MORTGAGE LOAN: Any Mortgage Loan (a) as to which the
Servicer has determined that all amounts
which it expects to recover from or on
account of such Mortgage Loan or property
acquired in respect thereof have been
recovered, (b) as to which a Cash
Liquidation has taken place or (c) with
respect to which the Mortgaged Property (or
stock allocated to a dwelling unit,
in the case of a Co-op Loan) has been
acquired by foreclosure or deed in lieu of
foreclosure and a disposition (the term
disposition shall include, for purposes
of a repurchase pursuant to Section 11.01,
any repurchase of a Mortgaged
Property (or stock allocated to a dwelling
unit, in the case of a Co-op Loan)
pursuant to such Section) of such Mortgaged
Property (or stock allocated to a
dwelling unit, in the case of a Co-op Loan)
has occurred.
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<PAGE>
LIQUIDATION EXPENSES: Expenses which are incurred by the Servicer
or
any Sub-Servicer in connection with the
liquidation of any defaulted Mortgage
Loan or property acquired in respect
thereof including, without limitation,
legal fees and expenses, any unreimbursed
amount expended by the Servicer
pursuant to Sections 5.16 and 5.21
respecting the related Mortgage Loan and any
related and unreimbursed expenditures for
real estate property taxes or for
property restoration or preservation.
LIQUIDATION PROCEEDS: Cash (including Insurance Proceeds) received
by
the Servicer in connection with the
liquidation of any Mortgage Loan or
Mortgaged Property (or stock allocated to a
dwelling unit in the case of a Co-op
Loan) acquired in respect thereof, whether
through the sale or assignment of
such Mortgage Loan (other than pursuant to
Section 5.21), trustee's sale,
foreclosure sale or otherwise, or the sale
of the Mortgaged Property (or stock
allocated to a dwelling unit, in the case
of a Co-op Loan) if the Mortgaged
Property (or stock allocated to a dwelling
unit, in the case of a Co-op Loan) is
acquired in satisfaction of the Mortgage
Loan other than amounts required to be
paid to the Mortgagor pursuant to law or
the terms of the applicable Mortgage
Note.
LOAN-TO-VALUE RATIO: The fraction, expressed as a percentage,
the
numerator of which is the principal amount
of the related Mortgage Loan at the
time of origination (or, (i) for purposes
of Section 5.15, at the time of
determination and (ii) for purposes of a
Mortgage Loan with respect to which a
conversion from adjustable rate to fixed
rate has occurred, at the time of
initial origination) and the denominator of
which is the Appraised Value of the
related Mortgaged Property (or applicable
dwelling unit in the case of a Co-op
Loan) at the time of initial origination
or, in the case of a Mortgage Loan
financing the acquisition of the Mortgaged
Property (or applicable dwelling unit
in the case of a Co-op Loan), the sales
price of the Mortgaged Property (or
applicable dwelling unit in the case of a
Co-op Loan), if such sales price is
less than such Appraised Value.
LOCKOUT PERCENTAGE: With respect to any Distribution Date, the
lesser
of (I) (A) the Outstanding Certificate
Principal Balance of the Class A-4
Certificates divided by (B) the Non-PO
Class A Principal Balance, in each case
immediately prior to the Distribution Date
and (II) 100.00%.
LOCKOUT PRINCIPAL DISTRIBUTION AMOUNT: (A) With respect to any
Distribution Date through and including the
Distribution Date in January 2007,
zero and (B) with respect to any
Distribution Date in or after February 2007,
the lesser of (i) the sum of (x) the
product of (I) the Lockout Percentage and
(II) the amount which is referred to in
clause (i) of the definition of Non-PO
Class A Optimal Principal Amount and (y)
the product of (I) the Lockout
Percentage, (II) the Step Down Percentage
and (III) the amount which is referred
to in clause (ii) through (v) of the
definition of Non-PO Class A Optimal
Principal Amount and (ii) the Non-PO Class
A Optimal Principal Amount.
MERS: Mortgage Electronic Registration Systems, Inc., a
Delaware
corporation, or any successor in interest
thereto.
MERS MORTGAGE LOAN: Any Mortgage Loan as to which the related
Mortgage,
or an Assignment of Mortgage, has been or
will be recorded in the name of MERS
or otherwise assigned to MERS, as agent for
the holder from time to time of the
Mortgage Note.
MODIFIED MORTGAGE LOAN: Any Mortgage Loan which the Servicer
has
modified pursuant to Section 5.01.
MONTHLY PAYMENT: The minimum required monthly payment of principal
and
interest due on a Mortgage Loan as
specified in the Mortgage Note for any Due
Date (before any adjustment to such
scheduled amount by reason of any bankruptcy
or similar proceeding or any moratorium or
similar waiver or grace period).
Monthly Payments shall be deemed due on an
Outstanding Mortgage Loan until such
time as it becomes a Liquidated Mortgage
Loan.
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<PAGE>
MOODY'S: Moody's Investors Service, Inc. or its successor in
interest.
MORTGAGE: With respect to a Mortgage Loan that is not a Co-op Loan,
the
mortgage, deed of trust or other instrument
creating a first or second lien or a
first or second priority ownership interest
in an estate in fee simple in real
property securing a Mortgage Note. With
respect to a Co-op Loan, the security
agreement creating a security interest in
the stock allocated to a dwelling unit
in a residential cooperative housing
corporation and pledged to secure such
Co-op Loan and the related Co-op Lease.
MORTGAGE FILE: As to each Mortgage Loan, the items referred to
in
Exhibit B annexed hereto.
MORTGAGE LOAN: An individual mortgage loan and all rights with
respect
thereto, evidenced by a Mortgage and a
Mortgage Note, sold and assigned by the
Depositor to the Trustee and which is
subject to this Agreement and included in
the Trust Fund. The Mortgage Loans
originally sold and subject to this Agreement
are identified on the Mortgage Loan
Schedule.
MORTGAGE LOAN SCHEDULE: The schedule of Mortgage Loans attached
hereto
as Exhibit A as it may be amended in
accordance with Section 3.03, setting forth
the following information as to each
Mortgage Loan: (i) the Mortgage Loan
identifying number; (ii) the street address
of the Mortgaged Property (or
Underlying Mortgaged Property, in the case
of a Co-op Loan), including the zip
code; (iii) an indication of whether the
Mortgaged Property (or the related
residential dwelling unit in the Underlying
Mortgaged Property, in the case of a
Co-op Loan), is owner-occupied; (iv) the
property type of the Mortgaged Property
(or the related residential dwelling unit
in the Underlying Mortgaged Property,
in the case of a Co-op Loan); (v) the
original number of months to stated
maturity; (vi) the number of months
remaining to stated maturity from the
Cut-off Date; (vii) the original
Loan-to-Value Ratio; (viii) the original
principal balance of the Mortgage Loan;
(ix) the unpaid principal balance of the
Mortgage Loan as of the close of business
on the Cut-off Date; (x) the Mortgage
Rate; (xi) the amount of the current
Monthly Payment; and (xii) the PO
Percentage with respect to such Mortgage
Loan.
MORTGAGE NOTE: The note or other evidence of the indebtedness of
a
Mortgagor secured by a Mortgage.
MORTGAGE POOL: The pool of Mortgage Loans held in the Trust
Fund.
MORTGAGE POOL PRINCIPAL BALANCE: As of any date of determination,
the
aggregate of the Principal Balances of each
Outstanding Mortgage Loan on such
date of determination less the principal
portion of any Monthly Payment due but
not paid with respect to which an Advance
has not been made, initially
$______________.
MORTGAGED PROPERTY: The property securing a Mortgage Note.
MORTGAGE RATE: With respect to each Mortgage Loan, the per annum
rate
of interest borne by the Mortgage Loan, as
specified in the Mortgage Note. The
Mortgage Rate for any Mortgage Loan shall
be zero with respect to the period
prior to the period during which interest
accrues with respect to such Mortgage
Loan's first Monthly Payment.
MORTGAGOR: The obligor on a Mortgage Note.
NET LIQUIDATION PROCEEDS: As to any Liquidated Mortgage Loan,
Liquidation Proceeds net of Liquidation
Expenses.
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<PAGE>
NET MORTGAGE RATE: With respect to each Mortgage Loan, a per annum
rate
of interest for the applicable period equal
to the Mortgage Rate less the
Servicing Fee.
NON-DISCOUNT MORTGAGE LOANS: The Mortgage Loans having Net
Mortgage
Rates in excess of the Remittance Rate.
NON-MERS MORTGAGE LOAN: Any Mortgage Loan other than a MERS
Mortgage
Loan
NON-PO ALLOCATED AMOUNT: At the time of any determination, the
amount
derived by (i) multiplying the Principal
Balance of each Outstanding Mortgage
Loan on such date of determination by the
Non-PO Percentage with respect to such
Mortgage Loan and (ii) summing the
results.
NON-PO CLASS A CERTIFICATES: The Class A-1, Class A-2, Class A-3,
Class
A-4, Class A-R and Class A-X Certificates,
referred to collectively.
NON-PO CLASS A OPTIMAL PRINCIPAL AMOUNT: With respect to any
Distribution Date, the lesser of (a) the
Non-PO Class A Principal Balance and
(b) the sum of:
(i) the Non-PO Class A Percentage of the applicable Non-PO
Percentage
of the principal portion of all Monthly
Payments, whether or not received, which
were due during the related Due Period on
Mortgage Loans which were outstanding
during such Due Period;
(ii) the Non-PO Class A Prepayment Percentage of the applicable
Non-PO
Percentage of all Principal Prepayments
made on any Mortgage Loan during the
related Principal Prepayment Period;
(iii) with respect to each Mortgage Loan not described in (iv)
below,
the Non-PO Class A Percentage of the
applicable Non-PO Percentage of the
principal portion of all Insurance
Proceeds, condemnation awards and any other
cash proceeds from a source other than the
applicable Mortgagor, to the extent
required to be deposited in the Collection
Account pursuant to Section 5.08(d)
and (e), which were received during the
related Principal Prepayment Period, net
of related unreimbursed Servicing Advances
and net of any portion thereof which,
as to any such Mortgage Loan, constitutes
Late Collections that have been the
subject of an Advance on any prior
Distribution Date;
(iv) with respect to each Mortgage Loan which has become a
Liquidated
Mortgage Loan during the related Principal
Prepayment Period, the lesser of (A)
the Non-PO Class A Percentage of applicable
Non-PO Percentage of an amount equal
to the Principal Balance of such Liquidated
Mortgage Loan as of the Due Date
immediately preceding the date on which it
became a Liquidated Mortgage Loan and
(B) the Non-PO Class A Prepayment
Percentage of the applicable Non-PO Percentage
of the Net Liquidation Proceeds with
respect to such liquidated Mortgage Loan
(net of any unreimbursed Advances);
(v) with respect to each Mortgage Loan repurchased during the
related
Principal Prepayment Period pursuant to
Section 2.02, 3.01, 5.01, 5.21 or 11.01,
an amount equal to the Non-PO Class A
Prepayment Percentage of the applicable
Non-PO Percentage of the principal portion
of the Purchase Price (net of amounts
with respect to which a distribution of
principal has previously been made to
the Non-PO Class A Certificateholders);
and
(vi) on or after the Credit Support Depletion Date, the excess of
the
Non-PO Class A Principal Balance
(calculated after giving effect to reductions
thereof on such Distribution Date with
respect to the amounts described in (i) -
(v) above) over the Non-PO Allocated
Amount, if any, as of the preceding
Distribution Date.
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<PAGE>
NON-PO CLASS A PERCENTAGE: As of any Distribution Date, the
fraction,
expressed as a percentage (which shall
never exceed 100%), the numerator of
which is the Non-PO Class A Principal
Balance and the denominator of which is
the Non-PO Allocated Amount as of the
immediately preceding Due Date.
NON-PO CLASS A PREPAYMENT PERCENTAGE: As of any Distribution Date
up to
and including the Distribution Date in
[MONTH/YEAR], 100%; as of any
Distribution Date during the first year
thereafter, the Non-PO Class A
Percentage plus __% of the Subordinated
Percentage for such Distribution Date;
as of any Distribution Date during the
second year thereafter, the Non-PO Class
A Percentage plus __% of the Subordinated
Percentage for such Distribution Date;
as of any Distribution Date during the
third year thereafter, the Non-PO Class A
Percentage plus __% of the Subordinated
Percentage for such Distribution Date;
as of any Distribution Date during the
fourth year thereafter, the Non-PO Class
A Percentage plus __% of the Subordinated
Percentage for such Distribution Date;
and as of any Distribution Date after the
fourth year thereafter, the Non-PO
Class A Percentage; provided that if the
Non-PO Class A Percentage as of any
such Distribution Date is greater than the
Non-PO Class A Percentage on the
first Distribution Date, the Non-PO Class A
Prepayment Percentage shall be 100%;
and provided further that whenever the
Non-PO Class A Percentage equals 0%, the
Non-PO Class A Prepayment Percentage shall
equal 0%; and provided further,
however, that no reduction of the Non-PO
Class A Prepayment Percentage below the
level in effect for the most recent period
shall occur with respect to any
Distribution Date unless, as of the last
day of the month preceding such
Distribution Date, (A) the aggregate
outstanding Principal Balance of the
Outstanding Mortgage Loans 60 days or more
delinquent (including Mortgage Loans
in foreclosure and with respect to which
the related Mortgaged Property (or
stock allocated to a dwelling unit, in the
case of a Co-op Loan) has been
acquired by the Trust Fund) does not exceed
__% of the aggregate Outstanding
Certificate Balance of the Subordinated
Certificates as of such date and (B)
cumulative Realized Losses through the last
day of the month preceding such
Distribution Date (including Nonrecoverable
Advances) do not exceed (i) if such
Distribution Date occurs between
[MONTH/YEAR] and [MONTH/YEAR] inclusive, __% of
the Original Subordinated Principal
Balance, (ii) if such Distribution Date
occurs between [MONTH/YEAR] and
[MONTH/YEAR] inclusive, __% of the Original
Subordinated Principal Balance, (iii) if
such Distribution Date occurs between
[MONTH/YEAR] and [MONTH/YEAR] inclusive,
__% of the Original Subordinated
Principal Balance, (iv) if such
Distribution Date occurs between [MONTH/YEAR]
and [MONTH/YEAR] inclusive, __% of the
Original Subordinated Principal Balance
and (v) if such Distribution Date occurs in
[MONTH/YEAR] and thereafter, __% of
the Original Subordinated Principal
Balance.
NON-PO CLASS A PRINCIPAL BALANCE: As of any Distribution Date, (a)
the
Non-PO Class A Principal Balance for the
immediately preceding Distribution Date
less (b) amounts distributed (or deemed
distributed) to the Non-PO Class A
Certificateholders on such preceding
Distribution Date allocable to principal
(including the principal portion of
Advances of the Servicer made pursuant to
Section 6.03 and Realized Losses allocated
to the Non-PO Class A Certificates
pursuant to Section 6.04); provided that
the Non-PO Class A Principal Balance on
the first Distribution Date shall be the
Original Non-PO Class A Principal
Balance.
NON-PO CLASS A PRINCIPAL PAYMENT RULES: [Describe payment
methodology].
NON-PO PERCENTAGE: With respect to each Mortgage Loan, the
fraction,
expressed as a percentage (but not greater
than 100%), the numerator of which
equals the applicable Net Mortgage Rate and
the denominator of which equals the
Remittance Rate.
NONRECOVERABLE ADVANCE: Any Advance previously made or proposed to
be
made in respect of a Mortgage Loan by the
Servicer pursuant to Section 6.03
which, in the good faith judgment of the
Servicer, will not or, in the case of a
proposed Advance, would not, ultimately be
recoverable by the Servicer from Late
Collections or otherwise. The determination
by the Servicer that it has made, or
would be making, a Nonrecoverable Advance
shall be evidenced by a certificate of
a Servicing Officer of the Servicer
delivered to the Trustee, any co-trustee and
the Depositor and detailing the reasons for
such determination.
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<PAGE>
OFFICERS' CERTIFICATE: A certificate signed by two of the Chairman
of
the Board, the Vice Chairman of the Board,
the President or a Vice President,
the Treasurer or the Secretary or one of
the Assistant Treasurers or Assistant
Secretaries or any other duly authorized
officer of the Depositor or the
Servicer, and delivered to the Trustee.
OPINION OF COUNSEL: A written opinion of counsel, who may be
counsel
for the Depositor or the Servicer and who
is reasonably acceptable to the
Trustee.
ORIGINAL CERTIFICATE PRINCIPAL BALANCE: With respect to any Class
of
Certificates, the amount specified for such
Class in Section 4.01(d).
ORIGINAL CLASS A PRINCIPAL BALANCE:
$______________
ORIGINAL CLASS M PRINCIPAL BALANCE:
$____________
ORIGINAL CLASS B PRINCIPAL BALANCE:
$____________
ORIGINAL NON-PO CLASS A PRINCIPAL BALANCE:
$______________
ORIGINAL CREDIT SUPPORT: With respect to any Class of
Subordinated
Certificates (other than the Class B-5
Certificates), the level of Credit
Support indicated below:
Class M:
____%
Class B-1:
____%
Class B-2:
____%
Class B-3:
____%
Class B-4:
____%
ORIGINAL SUBORDINATED PRINCIPAL BALANCE: The aggregate Original
Certificate Principal Balance of the
Subordinated Certificates.
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE: With respect to any
Class
(other than the Class A-X Certificates) of
Certificates and any Distribution
Date, the Original Certificate Principal
Balance of such Class minus the sum of
(i) any distributions of principal made on
such Class prior to such Distribution
Date and (ii) any Realized Losses allocated
to such Class prior to such
Distribution Date; provided, however, that
(I) with respect to the Class of
Class B Certificates then outstanding
having the highest numerical class
designation, the Outstanding Certificate
Principal Balance of such Class shall
equal the excess of the Mortgage Pool
Principal Balance (together with the
principal portion of any Monthly Payment
due but not paid with respect to which
an Advance has not been made) over the sum
of the Outstanding Certificate
Principal Balances of all Classes of
Certificates (other than the Class of Class
B Certificates then outstanding having the
highest numerical class designation);
and (II) during such time as the
Outstanding Certificate Principal Balance of
the Class B-1 Certificates equals zero,
with respect to the Class M
Certificates, the Outstanding Certificate
Principal Balance of such Class shall
equal the excess of the Mortgage Pool
Principal Balance (together with the
principal portion of any Monthly Payment
due but not paid with respect to which
an Advance has not been made) over the
Class A Principal Balance.
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<PAGE>
OUTSTANDING MORTGAGE LOAN: As to any Distribution Date, a Mortgage
Loan
which was not paid in full during the
related or any previous Principal
Prepayment Period, which did not become a
Liquidated Mortgage Loan during the
related or any previous Principal
Prepayment Period and which was not
repurchased under Section 2.02, 3.01, 5.01,
5.21 or 11.01 during the related or
any previous Principal Prepayment
Period.
PASS-THRU ENTITY: A "Pass-Thru Entity" as defined in Section
860E(e)(6)
of the Code.
PAYING AGENT: The Person appointed by the Trustee as Paying
Agent
pursuant to Section 4.05.
PERCENTAGE INTEREST: As to any Certificate (other than the Class
A-X
Certificates), the percentage interest
evidenced thereby in distributions
required to be made hereunder, such
percentage interest being equal, with
respect to any Class, to the percentage
obtained by dividing the Outstanding
Certificate Principal Balance of such
Certificate by the aggregate of the
Outstanding Certificate Principal Balances
of all the Certificates of such Class
and with respect to all Certificates, the
percentage obtained by dividing the
Outstanding Certificate Principal Balance
of such Certificate by the aggregate
of the Outstanding Certificate Principal
Balances of all the Certificates. With
respect to any Class A-X Certificate, the
percentage interest specified on the
face of such Certificate.
PERMITTED ACTIVITIES: The primary activities of the Trust
created
pursuant to this Agreement which shall be:
(i) holding Mortgage Loans
transferred from the Depositor and other
assets of the Trust Fund, including any
credit enhancement and passive derivative
financial instruments that pertain to
beneficial interests issued or sold to
parties other than the Depositor, its
Affiliates, or its agents; (ii) issuing
certificates and other interests in the
assets of the Trust Fund; (iii) receiving
collections on the Mortgage Loans and
making payments on such certificates and
interests in accordance with the terms
of this Agreement; and (iv) engaging in
other activities that are necessary or
incidental to accomplish these limited
purposes, which activities cannot be
contrary to the status of the Trust Fund as
a qualified special purpose entity
under existing accounting literature.
PERSON: Any individual, corporation, partnership, limited
liability
company, limited liability partnership,
joint venture, association, joint-stock
company, trust, unincorporated organization
or government or any agency or
political subdivision thereof.
PO PERCENTAGE: The PO Percentage with respect to each Mortgage Loan
as
identified on the Mortgage Loan Schedule,
such percentage being equal to the
fraction, expressed as a percentage (but
not less than 0%), the numerator of
which equals the excess of the Remittance
Rate over the applicable Net Mortgage
Rate and the denominator of which equals
the Remittance Rate.
PRIMARY INSURANCE POLICY: Each primary policy of mortgage
guaranty
insurance or any replacement policy
therefor referred to in Section 5.15 hereof.
PRINCIPAL BALANCE: At the time of any determination, the
principal
balance of a Mortgage Loan remaining to be
paid at the close of business on the
Cut-off Date (after deduction of all
principal payments due on or before the
Cut-off Date whether or not paid) (or, in
the case of a substitute Mortgage Loan
included in the Trust Fund pursuant to
Section 3.04, the close of business as of
the date of substitution) reduced by all
amounts previously distributed to
Certificateholders that are allocable to
payments of principal on such Mortgage
Loan (including the principal portion of
Advances of the Servicer made pursuant
to Section 6.03).
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<PAGE>
PRINCIPAL PREPAYMENT: Any payment or other recovery of principal on
a
Mortgage Loan (other than Late Collections)
which is received other than as part
of a Monthly Payment; provided, however,
that the term Principal Prepayment does
not include Insurance Proceeds, Liquidation
Proceeds, condemnation awards or
other cash proceeds from a source other
than the applicable Mortgagor.
PRINCIPAL PREPAYMENT PERIOD: With respect to any Distribution Date,
the
period beginning on the first day of the
month preceding the month in which such
Distribution Date occurs and ending on the
last day of such month.
PURCHASE PRICE: With respect to any Mortgage Loan required to
be
purchased on any date pursuant to Section
2.02, 3.01, 5.01, 5.21 or 11.01, an
amount equal to the sum of (a) 100% of the
Principal Balance thereof, (b) unpaid
accrued interest at the Mortgage Rate
thereon from the Due Date on which
interest was last paid by the Mortgagor or
Advanced by the Servicer to the Due
Date next following the date of repurchase
and (c) the aggregate of any
unreimbursed Advances and any unreimbursed
Servicing Advances.
QUALIFIED INSURER: An insurance company duly qualified as such
under
the laws of the states in which the
Mortgaged Properties are located, duly
authorized and licensed in such states to
transact the applicable insurance
business and to write the insurance
provided, approved as an insurer by FNMA and
FHLMC and whose claims-paying ability is
rated in the two highest rating
categories by S&P and Moody's with
respect to primary mortgage insurance and in
the two highest rating categories for
general policyholder rating and financial
performance index rating by A.M. Best
Company or its successor in interest with
respect to hazard and flood insurance.
[RATE ADJUSTMENT DATE: The LIBOR Business Day prior to the first
day of
each Interest Accrual Period after the
initial Interest Accrual Period.]
RATING AGENCY: Any nationally recognized statistical rating
organization, or its successor, that rated
one or more Classes of Certificates
at the request of the Depositor at the time
of the initial issuance of the
Certificates. 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,
designated by the Depositor, notice of
which designation shall be given to the
Trustee and the Servicer. References
herein to the two highest long-term debt
rating categories of a Rating Agency
shall mean AA or better in the case of
Fitch and Aa or better in the case of
Moody's.
REALIZED LOSS: With respect to (i) a Liquidated Mortgage Loan,
the
amount, if any, by which the unpaid
Principal Balance and accrued interest
thereon at a rate equal to the Net Mortgage
Rate exceeds the amount actually
recovered by the Servicer with respect
thereto (net of reimbursement of Advances
and Servicing Advances) at the time such
Mortgage Loan became a Liquidated
Mortgage Loan or (ii) with respect to a
Mortgage Loan which is not a Liquidated
Mortgage Loan, any amount of principal that
the Mortgagor is no longer legally
required to pay (except for the
extinguishment of debt that results from the
exercise of remedies due to default by the
Mortgagor).
REALIZED LOSS INTEREST SHORTFALL: The meaning specified in
Section
6.05(c).
RECORD DATE: The close of business of the last Business Day of
the
month preceding the month of the related
Distribution Date.
[REFERENCE BANK RATE: As of 11:00 A.M. London time, on the day that
is
one LIBOR Business Day prior to the
immediately preceding Distribution Date, the
rate at which deposits are offered by the
reference banks (which shall be three
major banks engaged in transactions in the
London interbank market, selected by
the Servicer) to prime banks in the London
interbank market for a period of one
month in amounts approximately equal to the
aggregate Outstanding Certificate
Principal Balance of the Class ___ and
Class ___ Certificates in accordance with
the following procedures. The Servicer will
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
will be the arithmetic mean of the
quotations. If on such date fewer than two
quotations are provided as requested,
the rate will be the arithmetic mean of the
rates quoted by one or more major
banks in New York City, selected by the
Servicer as of 11:00 A.M., New York City
time, on such date for loans in U.S.
Dollars to leading European banks for a
period of one month in amounts
approximately equal to the aggregate Outstanding
Certificate Principal Balance of the Class
___ and Class ___ Certificates. In
the event no such quotations can be
obtained, the rate will be LIBOR for the
prior Distribution Date, or in the case of
the first Rate Adjustment Date,
_________%].
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<PAGE>
REGULATION AB: Regulation AB promulgated under the Securities Act
and
the Exchange Act, as the same may be
amended from time to time; and all
references to any rule, item, section or
subsection of, or definition or term
contained in, Regulation AB mean such rule,
item, section, subsection,
definition or term, as the case may be, or
any successor thereto, in each case
as the same may be amended from time to
time.
RELEVANT MORTGAGE LOAN: The meaning specified in Section 5.01.
REMIC: A "real estate mortgage investment conduit," as such term
is
defined in Section 860D of the Code.
References herein to "the REMIC" shall mean
the REMIC created hereunder.
REMIC PROVISIONS: Provisions of the federal income tax law relating
to
REMICs which appear at Sections 860A
through 860G of Part IV of Subchapter M of
Chapter 1 of Subtitle A of the Code, and
related provisions, and U.S. Department
of the Treasury temporary, proposed or
final regulations and rulings promulgated
thereunder, as the foregoing are in effect
(or with respect to proposed
regulations, are proposed to be in effect)
from time to time.
REMITTANCE RATE: ____% per annum.
REPURCHASE PROCEEDS: All proceeds of any Mortgage Loan or
property
acquired in respect thereof repurchased
pursuant to Section 2.02, 3.01, 5.01,
5.21 or 11.01.
RESIDUAL INTEREST: The interest in the Trust Fund represented by
(i)
amounts, if any, remaining in the
Collection Account following termination of
the Trust Fund after payments to the Class
A Certificateholders (other than the
Class A-R Certificateholder), the Class M
Certificateholders and the Class B
Certificateholders and (ii) the right to
receive payments of Excess Proceeds and
Substitute Excess Interest and payments
under Section 6.01(a)(v) hereof.
RESPONSIBLE OFFICER: When used with respect to the Trustee, any
Senior
Vice President, any Vice President, any
Assistant Vice President, any Senior
Trust Officer, any Trust Officer or any
other officer of the Trustee in its
Agency & Trust Office customarily
performing functions similar to those
performed by any of the above designated
officers and also, with respect to a
particular matter, any other officer in its
Agency & Trust Office to whom such
matter is referred because of such
officer's knowledge of and familiarity with
the particular subject.
SFAS 140: Statement of Financial Accounting Standard No. 140,
Accounting for Transfers and Servicing of
Financial Assets and Extinguishment of
Liabilities dated September 2000, published
by the Financial Accounting
Standards Board of the Financial Accounting
Foundation.
S&P: Standard & Poor's, a division of The McGraw-Hill
Companies, Inc.
or its successor in interest.
SALE AGREEMENT: The Mortgage Loan Sale Agreement dated as of
[DATE]
between the Depositor and CHF.
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<PAGE>
SCHEDULED PRINCIPAL BALANCE: With respect to any Mortgage Loan as
of
any Distribution Date, the unpaid principal
balance of such Mortgage Loan as
specified in the amortization schedule at
the time relating thereto (before any
adjustment to such schedule by reason of
bankruptcy or similar proceeding or any
moratorium or similar waiver or grace
period) as of the Due Date in the month
preceding the month of such Distribution
Date, or as the Cut-off Date, with
respect to the first Distribution Date,
after giving effect to any previously
applied prepayments, the payment of
principal due on such first day of the month
and any reduction of the principal balance
of such Mortgage Loan by a bankruptcy
court, irrespective of any delinquency in
payment by the related Mortgagor.
SECTION 302 REQUIREMENTS: Any rules or regulations promulgated
pursuant
to the Sarbanes-Oxley Act of 2002 (as such
may be amended from time to time).
SELLER: [CHF].
SERVICER: CHF or any successor under this Agreement as herein
provided.
SERVICING ADVANCES: All customary, reasonable and necessary "out
of
pocket" costs and expenses incurred in the
performance by the Servicer of its
servicing obligations and which are
"unanticipated expenses" of the REMIC, as
defined in the REMIC Provisions, including,
but not limited to, the cost of (i)
the preservation, restoration and
protection of the Mortgaged Property (or
Underlying Mortgaged Property, in the case
of a Co-op Loan), (ii) any
enforcement or judicial proceedings,
including foreclosures, (iii) the
management and liquidation of the Mortgaged
Property (or stock allocated to a
dwelling unit, in the case of a Co-op Loan)
if the Mortgaged Property (or stock
allocated to a dwelling unit, in the case
of a Co-op Loan) is acquired in
satisfaction of the Mortgage, (iv) taxes
and assessments on the Mortgaged
Properties subject to the Mortgage Loans
and (v) compliance with the obligations
under Section 5.21.
SERVICING FEE: The amount of the monthly fee paid for the servicing
of
the Mortgage Loans, equal to, as of any
Distribution Date, the total of, with
respect to each Mortgage Loan, one-twelfth
of ______% per annum of the Principal
Balance thereof as of the Determination
Date in the preceding month, subject to
adjustment as provided in Section 6.05. The
Servicing Fee shall be payable only
at the time of and with respect to those
Mortgage Loans for which payment is in
fact made of the entire amount of the
Monthly Payments that shall have come due
and only at the time such Monthly Payment
shall be made. The right to receive
the Servicing Fee is limited to, and the
Servicing Fee is payable solely from,
the interest portion of such Monthly
Payments (or the interest portion of any
Principal Prepayment in full) collected by
the Servicer, or as otherwise
provided under Section 5.09 or 5.23.
SERVICING OFFICER: Any officer of the Servicer or any
Sub-Servicer
involved in, or responsible for, the
administration and servicing of the
Mortgage Loans whose name appears on a
written certificate listing servicing
officers furnished to the Trustee by the
Servicer on or prior to the Closing
Date, and signed on behalf of the Servicer
or any Sub-servicer by its President,
any Vice President or its Treasurer, as
such certificate may from time to time
be amended.
SIMILAR LAW: The meaning specified in Section 4.02(d).
SINGLE CERTIFICATE: A Certificate of any Class that evidences
the
smallest permissible original denomination
for such Class of Certificates as
specified in Section 4.01(d).
SPECIAL HAZARD AMOUNT: Initially, $____________. As of the
first
anniversary of the Cut-off Date, the
Special Hazard Amount shall be reduced, but
not increased, to the lesser of (i) the
initial Special Hazard Amount less the
sum of all amounts allocated to the
Subordinated Certificates in respect of
Special Hazard Losses on the Mortgage Loans
during such year and (ii) the
Adjustment Amount for such anniversary. As
of each subsequent anniversary of the
Cut-off Date, the Special Hazard Amount
shall be reduced, but not increased, to
the lesser of (i) the Special Hazard Amount
on the immediately preceding
anniversary of the Cut-off Date less the
sum of all amounts allocated to the
Subordinated Certificates in respect of
Special Hazard Losses on the Mortgage
Loans during such year and (ii) the
Adjustment Amount for such anniversary. The
"Adjustment Amount" with respect to each
anniversary of the Cut-off Date will be
equal to the greatest of (i) ____%
multiplied by the aggregate outstanding
Principal Balance of the Mortgage Loans,
(ii) the aggregate outstanding
Principal Balance of the Mortgage Loans
secured by Mortgaged Properties located
in the California postal zip code area in
which the highest percentage of
Mortgage Loans by Principal Balance are
located and (iii) twice the outstanding
Principal Balance of the Mortgage Loan
having the largest outstanding Principal
Balance.
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<PAGE>
SPECIAL HAZARD LOSS: With respect to any Mortgage Loan, any
Realized
Loss or portion thereof resulting from
direct physical loss or damage to the
related Mortgaged Property (or Underlying
Mortgaged Property, in the case of a
Co-op Loan), which is not insured against
under the Standard Hazard Policy
required to be maintained hereunder.
STANDARD HAZARD POLICY: Each standard hazard insurance policy
or
replacement therefor referred to in Section
5.16.
STARTUP DAY: The meaning specified in Section 2.04(a).
STEP-DOWN PERCENTAGE: With respect to any Distribution Date,
the
percentage indicated below:
Distribution Date Occurring in
Step Down Percentage
[MONTH/YEAR] through
[MONTH/YEAR].................
0%
[MONTH/YEAR] through
[MONTH/YEAR].................
__%
[MONTH/YEAR] through
[MONTH/YEAR].................
__%
[MONTH/YEAR] through
[MONTH/YEAR].................
__%
[MONTH/YEAR] through
[MONTH/YEAR].................
__%
[MONTH/YEAR] and
thereafter.......................
100%
STRIPPED INTEREST RATE: For each Mortgage Loan, the excess, if any,
of
the Net Mortgage Rate for such Mortgage
Loan over the Remittance Rate.
SUBORDINATED CERTIFICATES: The Class M and Class B
Certificates,
referred to collectively.
SUBORDINATED OPTIMAL PRINCIPAL AMOUNT: With respect to any
Distribution
Date, the lesser of (a) the aggregate
Outstanding Certificate Principal Balance
of the Subordinated Certificates (before
giving effect to any distributions of
principal on such Distribution Date) and
(b)(1) the sum of: (i) the Subordinated
Percentage of the applicable Non-PO
Percentage of the principal portion of all
Monthly Payments, whether or not received,
which were due during the related Due
Period on Mortgage Loans which were
outstanding during such Due Period; (ii) the
Subordinated Prepayment Percentage of the
applicable Non-PO Percentage of all
Principal Prepayments made on any Mortgage
Loan during the related Principal
Prepayment Period; (iii) with respect to
each Mortgage Loan not described in
(iv) below, the Subordinated Percentage of
the applicable Non-PO Percentage of
the principal portion of all Insurance
Proceeds, condemnation awards and any
other cash proceeds from a source other
than the applicable Mortgagor, to the
extent required to be deposited in the
Collection Account pursuant to Section
5.08(iv) and (v), which were received
during the related Principal Prepayment
Period, net of related unreimbursed
Servicing Advances and net of any portion
thereof which, as to any such Mortgage
Loan, constitutes Late Collections that
have been the subject of an Advance on any
prior Distribution Date; (iv) with
respect to each Mortgage Loan which has
become a Liquidated Mortgage Loan during
the related Principal Prepayment Period, an
amount equal to the portion (if any)
of the Net Liquidation Proceeds with
respect to such liquidated Mortgage Loan
(net of any unreimbursed Advances) that was
not included in the Class A-P Amount
or the Non-PO Class A Optimal Principal
Amount with respect to such Distribution
Date; and (v) with respect to each Mortgage
Loan repurchased during the related
Principal Prepayment Period pursuant to
Section 2.02, 3.01, 5.01, 5.21 or 11.01,
an amount equal to the Subordinated
Prepayment Percentage of the applicable
Non-PO Percentage of the principal portion
of the Purchase Price (net of amounts
with respect to which a distribution of
principal has previously been made to
the Subordinated Certificateholders) minus
(2) the Class A-P Shortfall Amount
with respect to such Distribution Date.
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<PAGE>
SUBORDINATED PERCENTAGE: As of any Distribution Date, the
difference
between 100% and the Non-PO Class A
Percentage.
SUBORDINATED PREPAYMENT PERCENTAGE: As of any Distribution Date,
the
difference between 100% and the Non-PO
Class A Prepayment Percentage.
SUB-SERVICER: Any Person with whom the Servicer enters into a
Sub-Servicing Agreement.
SUB-SERVICING AGREEMENT: Any agreement between the Servicer and
any
Sub-Servicer, relating to servicing or
administration of certain Mortgage Loans
as provided in Section 5.02, in such form
as has been approved by the Servicer
and the Depositor.
SUBSTITUTE EXCESS INTEREST: As defined in Section 3.03.
TRUST: The Trust created pursuant to this Agreement.
TRUST FUND: The corpus of the Trust consisting of (i) the
Mortgage
Loans, (ii) such assets as shall from time
to time be identified as deposited in
the Collection Account and the Certificate
Account, (iii) property which secured
a Mortgage Loan and which has been acquired
by foreclosure or deed in lieu of
foreclosure, (iv) Standard Hazard Policies
and any other insurance policies, and
the proceeds thereof and (v) any proceeds
of any of the foregoing.
TRUSTEE: [TRUSTEE], a _____________________ and its successors and
any
corporation resulting from or surviving any
consolidation or merger to which it
or its successors may be a party, and any
successor trustee at the time serving
as successor trustee hereunder, appointed
as herein provided.
UNDERLYING MORTGAGED PROPERTY: With respect to each Co-op Loan,
the
underlying real property owned by the
related residential cooperative housing
corporation.
U.S. PERSON: A "United States Person" as defined in Section
7701(a)(30)
of the Code.
[END OF ARTICLE I]
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; TRUST FUND
Section 2.01. Conveyance of Mortgage Loans.
The Depositor, concurrently with the execution and delivery
hereof,
does hereby sell, transfer, assign, set
over and convey to the Trustee without
recourse all the right, title and interest
of the Depositor in and to the
Mortgage Loans, including all interest and
principal received on or with respect
to the Mortgage Loans on or after the
Cut-off Date (other than Monthly Payments
due on the Mortgage Loans on or before the
Cut-off Date).
In connection with such assignment, the Depositor does hereby
deliver
to, and deposit with, the Trustee the
following documents or instruments with
respect to each Mortgage Loan so
assigned.
24
<PAGE>
(i) With respect to each Mortgage Loan which is not a Co-op
Loan:
(A) Original Mortgage Note (or a lost note affidavit
(including a copy of the original Mortgage Note)) or (II)
original
consolidation, extension and modification agreement (or a lost
note
affidavit (including a copy of the original consolidation,
extension
and modification agreement)), in either case endorsed "Pay to the
order
of [TRUSTEE], as trustee, without recourse".
(B) The original Mortgage (including all riders thereto) with
evidence of recording thereon, or a copy thereof certified by
the
public recording office in which such Mortgage has been recorded
or, if
the original Mortgage has not been returned from the applicable
public
recording office, a true certified copy, certified by the Seller,
of
the original Mortgage together with a certificate of the Seller
certifying that the original Mortgage has been delivered for
recording
in the appropriate public recording office of the jurisdiction in
which
the Mortgaged Property is located.
(ii) With respect to each Non-MERS Mortgage Loan which is not a
Co-op
Loan:
(A) The original Assignment of Mortgage to "[TRUSTEE], as
trustee," which assignment shall be in form and substance
acceptable
for recording, or a copy certified by the Seller as a true and
correct
copy of the original Assignment of Mortgage which has been sent
for
recordation. Subject to the foregoing, such assignments may, if
permitted by law, be by blanket assignments for Mortgage Loans
covering
Mortgaged Properties situated within the same county. If the
Assignment
of Mortgage is in blanket form, a copy of the Assignment of
Mortgage
shall be included in the related individual Mortgage File.
(B) The original policy of title insurance, including riders
and endorsements thereto, or if the policy has not yet been issued,
a
written commitment or interim binder or preliminary report of
title
issued by the title insurance or escrow company.
(C) Originals of all recorded intervening Assignments of
Mortgage, or copies thereof, certified by the public recording
office
in which such Assignments or Mortgage have been recorded showing
a
complete chain of title from the originator to the Depositor,
with
evidence of recording, thereon, or a copy thereof certified by
the
public recording office in which such Assignment of Mortgage has
been
recorded or, if the original Assignment of Mortgage has not
been
returned from the applicable public recording office, a true
certified
copy, certified by the Seller of the original Assignment of
Mortgage
together with a certificate of the Seller certifying that the
original
Assignment of Mortgage has been delivered for recording in the
appropriate public recording office of the jurisdiction in which
the
Mortgaged Property is located.
(D) Originals, or copies thereof certified by the public
recording office in which such documents have been recorded, of
each
assumption, extension, modification, written assurance or
substitution
agreements, if applicable, or if the original of such document has
not
been returned from the applicable public recording office, a
true
certified copy, certified by the Seller, of such original
document
together with certificate of Seller certifying the original of
such
document has been delivered for recording in the appropriate
recording
office of the jurisdiction in which the Mortgaged Property is
located.
25
<PAGE>
(E) If the Mortgage Note or Mortgage or any other material
document or instrument relating to the Mortgage Loan has been
signed by
a person on behalf of the Mortgagor, the original power of attorney
or
other instrument that authorized and empowered such person to
sign
bearing evidence that such instrument has been recorded, if so
required
in the
appropriate jurisdiction where the Mortgaged Property is
located
(or, in lieu thereof, a duplicate or conformed copy of such
instrument,
together with a certificate of receipt from the recording
office,
certifying that such copy represents a true and complete copy of
the
original and that such original has been or is currently submitted
to
be recorded in the appropriate governmental recording office of
the
jurisdiction where the Mortgaged Property is located), or if
the
original power of attorney or other such instrument has been
delivered
for recording in the appropriate public recording office of the
jurisdiction in which the Mortgaged Property is located.
(iii) With respect to each Co-op Loan:
(A) (I) The original Mortgage Note (or a lost note affidavit
(including a copy of the original Mortgage Note)) or (II)
original
consolidation, extension and modification agreement (or a lost
note
affidavit (including a copy of the original consolidation,
extension
and modification agreement)), in either case endorsed "Pay to the
order
of [TRUSTEE], as trustee, without recourse."
(B) The original Mortgage entered into by the Mortgagor with
respect to such Co-Op Loan.
(C) The original Assignment of Mortgage to "[TRUSTEE] as
trustee".
(D) Original assignments of Mortgage showing a complete chain
of assignment from the originator of the related Co-Op Loan to
the
Seller.
(E) Original Form UCC-1 and any continuation statements with
evidence of filing thereon entered into by the Mortgagor with
respect
to such Co-Op Loan.
(F) Form UCC-3 (or copy thereof) by the applicable Mortgage
Loan Seller or its agent assigning the security interest covered
by
such Form UCC-1 to "[TRUSTEE] as trustee", together with all
Forms
UCC-3 (or copies thereof) showing a complete chain of assignment
from
the originator of the related Co-op Loan to the Seller, with
evidence
of recording thereon.
(G) Stock certificate representing the stock allocated to the
related dwelling unit in the related residential cooperative
housing
corporation and pledged by the related Mortgagor to the originator
of
such Co-op Loan with a stock power in blank attached.
(H) Original proprietary lease.
(I) Original assignment of proprietary lease, to the Trustee,
and all intervening assignments thereof.
(J) Original recognition agreement of the interests of the
mortgagee with
respect to the Co-op Loan by the residential cooperative
housing corporation, the stock of which was pledged by the
related
Mortgagor to the originator of such Co-op Loan.
26
<PAGE>
(K) Originals of any assumption, consolidation or modification
agreements relating to any of the items specified in (A) through
(F)
above with respect to such Co-op Loan.
If in connection with any Mortgage Loan which is not a Co-op Loan
the
Depositor cannot deliver the Mortgage,
Assignments of Mortgage, or assumption,
consolidation or modification agreement, as
the case may be, with evidence of
recording thereon concurrently with the
execution and delivery of this Agreement
solely because of a delay caused by the
public recording office where such
Mortgage, Assignments of Mortgage, or
assumption, consolidation or modification
agreement, as the case may be, has been
delivered for recordation, the Depositor
shall deliver or cause to be delivered to
the Trustee written notice stating
that such Mortgage, Assignments of
Mortgage, or assumption, consolidation or
modification agreement, as the case may be,
has been delivered to the
appropriate public recording office for
recordation. Thereafter, the Depositor
shall deliver or cause to be delivered to
the Trustee such Mortgage, Assignments
of Mortgage, or assumption, consolidation
or modification agreement, as the case
may be, with evidence of recording
indicated thereon upon receipt thereof from
the public recording office.
With respect to any Non-MERS Mortgage Loans which are not Co-op
Loans,
and as to which the related Mortgaged
Property is located in Florida, the
Servicer shall cause to be recorded in the
appropriate public recording office
for real property records each Assignment
of Mortgage referred to in this
Section 2.01 as soon as practicable. With
respect to any Non-MERS Mortgage Loans
which are not Co-op Loans as to which the
related Mortgaged Property is located
outside of Florida, the Servicer shall not
be obligated to cause to be recorded
the Assignment of Mortgage referred to in
this Section 2.01. With respect to
Co-op Loans as to which the related
dwelling unit is located in Florida, the
Servicer shall cause to be filed in the
appropriate filing office the Form UCC-3
referred to in this Section 2.01 as soon as
practicable. With respect to any
Co-op Loans as to which the related
dwelling unit is located outside Florida,
the Servicer shall not be obligated to
cause to be filed the Form UCC-3 referred
to in this Section 2.01. While each such
Assignment of Mortgage or Form UCC-3 is
being recorded or filed, as applicable, the
Servicer shall deliver to the
Trustee a photocopy of such document. If
any such Assignment of Mortgage or Form
UCC-3 is returned unrecorded or unfiled to
the Servicer because of any defect
therein, the Servicer shall cause such
defect to be cured and such document to
be recorded or filed in accordance with
this paragraph. The Depositor shall
deliver or cause to be delivered each such
original recorded or filed Assignment
of Mortgage and intermediate assignment or
Form UCC-3 to the Trustee within 270
days of the Closing Date or shall deliver
to the Trustee on or before such date
an Officer's Certificate stating that such
document has been delivered to the
appropriate public recording or filing
office for recording or filing, but has
not been returned solely because of a delay
caused by such recording or filing
office. In any event, the Depositor shall
use all reasonable efforts to cause
each such document with evidence of
recording or filing thereon to be delivered
to the Trustee within 300 days of the
Closing Date.
With respect to each MERS Mortgage Loan, the Trustee, at the
expense of
the Depositor and at the direction and with
the cooperation of the Servicer,
shall cause to be taken such actions as are
necessary to cause the Trustee to be
clearly identified as the owner of each
such Mortgage Loan on the records of
MERS for purposes of the system of
recording transfers of beneficial ownership
of mortgages maintained by MERS.
27
<PAGE>
The ownership of each Mortgage Note, the Mortgage and the contents
of
the related Mortgage File is vested in the
Trustee. Neither the Depositor nor
the Servicer shall take any action
inconsistent with such ownership and shall
not claim any ownership interest therein.
The Depositor and the Servicer shall
respond to any third party inquiries with
respect to ownership of the Mortgage
Loans by stating that such ownership is
held by the Trustee on behalf of the
Certificateholders. Mortgage documents
relating to the Mortgage Loans not
delivered to the Trustee are and shall be
held in trust by the Servicer or any
Sub-Servicer, for the benefit of the
Trustee as the owner thereof, and the
Servicer's or such Sub-Servicer's
possession of the contents of each Mortgage
File so retained is for the sole purpose of
servicing the related Mortgage Loan,
and such retention and possession by the
Servicer or such Sub-Servicer is in a
custodial capacity only. The Depositor
agrees to take no action inconsistent
with the Trustee's ownership of the
Mortgage Loans, to promptly indicate to all
inquiring parties that the Mortgage Loans
have been sold and to claim no
ownership interest in the Mortgage Loans.
Each Mortgage File and the mortgage
documents relating to the Mortgage Loans
contain proprietary business
information of the Servicer and its
customers. The Trustee and the Depositor
agree that they will not use such
information for business purposes without the
express written consent of the Servicer and
that all such information shall be
kept strictly confidential.
It is the intention of this Agreement that the conveyance of
the
Depositor's right, title and interest in
and to the Trust Fund pursuant to this
Agreement shall constitute a purchase and
sale and not a loan. If a conveyance
of Mortgage Loans from the Seller to the
Depositor is characterized as a pledge
and not a sale, then the Depositor shall be
deemed to have transferred to the
Trustee all of the Depositor's right, title
and interest in, to and under the
obligations of the Seller deemed to be
secured by said pledge; and it is the
intention of this Agreement that the
Depositor shall also be deemed to have
granted to the Trustee a first priority
security interest in all of the
Depositor's right, title, and interest in,
to and under the obligations of the
Seller to the Depositor deemed to be
secured by said pledge and that the Trustee
shall be deemed to be an independent
custodian for purposes of perfection of the
security interest granted to the Depositor.
If the conveyance of the Mortgage
Loans from the Depositor to the Trustee is
characterized as a pledge, it is the
intention of this Agreement that this
Agreement shall constitute a security
agreement under applicable law, and that
the Depositor shall be deemed to have
granted to the Trustee a first priority
security interest in all of the
Depositor's right, title and interest in,
to and under the Mortgage Loans, all
payments of principal of or interest on
such Mortgage Loans, all other rights
relating to and payments made in respect of
the Trust Fund, and all proceeds of
any thereof. If the trust created by this
Agreement terminates prior to the
satisfaction of the claims of any Person in
any Certificates, the security
interest created hereby shall continue in
full force and effect and the Trustee
shall be deemed to be the collateral agent
for the benefit of such Person.
In addition to the conveyance made in the first paragraph of
this
Section 2.01, the Depositor does hereby
convey, assign and set over to the
Trustee all of its right, title and
interest in that portion of the Trust Fund
described in items (ii), (iii), (iv) and
(v) of the definition thereof and
further assigns to the Trustee for the
benefit of the Certificateholders those
representations and warranties of the
Seller contained in the Sale Agreement and
described in Section 3.01 hereof and the
benefit of the repurchase obligations
of the Seller described in Sections 2.02
and 3.01 hereof and the obligations of
the Seller contained in the Sale Agreement
to take, at the request of the
Depositor or the Trustee, all action on its
part which is reasonably necessary
to ensure the enforceability of a Mortgage
Loan.
Section 2.02. Acceptance by Trustee.
Except as set forth in the Exception Report delivered
contemporaneously
herewith (the "Exception Report"), the
Trustee acknowledges receipt of the
Mortgage Note for each Mortgage Loan and
delivery of a Mortgage File (but does
not acknowledge receipt of all documents
required to be included in such
Mortgage File) with respect to each
Mortgage Loan and declares that it holds and
will hold such documents and any other
documents constituting a part of the
Mortgage Files delivered to it in trust for
the use and benefit of all present
and future Certificateholders. The
Depositor will cause the Seller to repurchase
any Mortgage Loans to which an exception
was taken in the Exception Report
unless such exception is cured to the
satisfaction of the Trustee within 45
Business Days of the Closing Date.
28
<PAGE>
The Trustee agrees, for the benefit of Certificateholders, to
review
each Mortgage File delivered to it within
270 days after the Closing Date to
ascertain that all documents required by
Section 2.01 have been executed and
received, and that such documents relate to
the Mortgage Loans identified in
Exhibit A that have been conveyed to it. If
the Trustee finds any document or
documents constituting a part of a Mortgage
File to be missing or defective
(that is, mutilated, damaged, defaced or
unexecuted) in any material respect,
the Trustee shall promptly (and in any
event within no more than five Business
Days) after such finding so notify the
Servicer, the Seller and the Depositor.
In addition, the Trustee shall also notify
the Servicer, the Seller and the
Depositor, if (a) in examining the Mortgage
Files, the documentation shows on
its face (i) any adverse claim, lien or
encumbrance, (ii) that any Mortgage Note
was overdue or had been dishonored, (iii)
any evidence on the face of any
Mortgage Note or Mortgage of any security
interest or other right or interest
therein, or (iv) any defense against or
claim to the Mortgage Note by any party
or (b) the original Mortgage with evidence
of recording thereon with respect to
a Mortgage Loan is not received within 270
days of the Closing Date; provided,
however, that if the Depositor cannot
deliver the original Mortgage with
evidence of recording thereon because of a
delay caused by the public recording
office where such Mortgage has been
delivered for recordation, the Depositor
shall deliver or cause to be delivered to
the Trustee written notice stating
that such Mortgage has been delivered to
the appropriate public recording
officer for recordation and thereafter the
Depositor shall deliver or cause to
be delivered such Mortgage with evidence of
recording thereon upon receipt
thereof from the public recording office.
The Trustee shall request that the
Seller correct or cure such omission,
defect or other irregularity, or
substitute a Mortgage Loan pursuant to the
provisions of Section 3.03, within 60
days from the date the Seller was notified
of such omission or defect and, if
the Seller does not correct or cure such
omission or defect within such period,
that the Seller purchase such Mortgage Loan
from the Trustee within 90 days from
the date the Trustee notified the Seller of
such omission, defect or other
irregularity at the Purchase Price of such
Mortgage Loan. The Purchase Price for
any Mortgage Loan purchased pursuant to
this Section 2.02 shall be paid to the
Servicer and deposited by the Servicer in
the Collection Account promptly upon
receipt, and, upon receipt by the Trustee
of written notification of such
deposit signed by a Servicing Officer, the
Trustee shall promptly release to the
Seller the related Mortgage File and the
Trustee shall execute and deliver such
instruments of transfer or assignment,
without recourse, as shall be necessary
to vest in the Seller or its designee, as
the case may be, any Mortgage Loan
released pursuant hereto, and the Trustee
shall have no further responsibility
with regard to such Mortgage Loan. It is
understood and agreed that the
obligation of the Seller to purchase, cure
or substitute any Mortgage Loan as to
which a material defect in or omission of a
constituent document exists shall
constitute the sole remedy respecting such
defect or omission available to the
Trustee on behalf of Certificateholders.
The Trustee shall be under no duty or
obligation to inspect, review and examine
such documents, instruments,
certificates or other papers to determine
that they are genuine, enforceable or
appropriate to the represented purpose, or
that they have actually been
recorded, or that they are other than what
they purport to be on their face. The
Trustee shall keep confidential the name of
each Mortgagor and shall not solicit
any such Mortgagor for the purpose of
refinancing the related Mortgage Loan.
Within 280 days of the Closing Date, the Trustee shall deliver to
the
Depositor and the Servicer the Trustee's
Certification, substantially in the
form of Exhibit G attached hereto, setting
forth the status of the Mortgage
Files as of such date.
Section 2.03. Trust Fund; Authentication of Certificates.
The Trustee acknowledges and accepts the assignment to it of the
Trust
Fund created pursuant to this Agreement in
trust for the use and benefit of all
present and future Certificateholders. The
Trustee acknowledges the assignment
to it for the benefit of the Trust Fund of
the Mortgage Loans and has caused to
be authenticated and delivered to or upon
the order of the Depositor, in
exchange for the Mortgage Loans,
Certificates duly authenticated by the Trustee
or, if an Authenticating Agent has been
appointed pursuant to Section 4.06, the
Authenticating Agent in authorized
denominations evidencing ownership of the
entire Trust Fund.
29
<PAGE>
Section 2.04. REMIC Election.
(a) The Depositor hereby instructs and authorizes the Trustee to
make
an appropriate election to treat each of
the Trust Fund as a REMIC. This
Agreement shall be construed so as to carry
out the intention of the parties
that the Trust Fund be treated as a REMIC
at all times prior to the date on
which the Trust Fund is terminated. The
Closing Date is hereby designated as the
"startup day" of the REMIC within the
meaning of Section 860G(a)(9) of the Code.
The "regular interests" (within the meaning
of Section 860G(a)(1) of the Code)
in the REMIC shall consist of the Class A
Certificates (other than the Class A-R
Certificate), the Class M Certificates and
the Class B Certificates, and the
"residual interest" (within the meaning of
Section 860G(a)(2) of the Code) in
the REMIC shall consist of the Class A-R
Certificate, and all such interests
shall be designated as such on the Startup
Day. Solely for the purposes of
Section 1.860G-1(a)(4)(iii) of the Treasury
regulations, the "latest possible
maturity date" by which the Outstanding
Certificate Principal Balance of each
Class of Certificates representing a
regular interest in the REMIC would be
reduced to zero is the Distribution Date
immediately following the latest
scheduled maturity of any Mortgage
Loan.
(b) The "tax matters person" with respect to the Trust Fund for
purposes of the REMIC provisions shall be
the beneficial owner of the Class A-R
Certificate; provided, however, that such
beneficial owner of a Class A-R
Certificate, by its acceptance thereof,
irrevocably appoints the Servicer as its
agent and attorney-in-fact to act as "tax
matters person" with respect to the
Trust Fund for purposes of the REMIC
provisions.
(c) It is intended that the Trust Fund shall constitute, and that
the
affairs of the Trust Fund shall be
conducted so as to qualify the Trust Fund as,
a "real estate mortgage investment conduit"
as defined in and in accordance with
the REMIC Provisions. In furtherance of
such intention, the Servicer covenants
and agrees that it shall act as agent (and
the Servicer is hereby appointed to
act as agent) on behalf of the Trust Fund
and the Holder of the Class A-R
Certificate and that in such capacity it
shall:
(i) prepare and file, or cause to be prepared and filed, in a
timely manner, a U.S. Real Estate Mortgage Investment Conduit
Income
Tax Return (Form 1066) and prepare and file or cause to be prepared
and
filed with the Internal Revenue Service and applicable state or
local
tax authorities income tax or information returns for each taxable
year
with respect to the Trust Fund using the calendar year as the
taxable
year and the accrual method of accounting, containing such
information
and at the times and in the manner as may be required by the Code
or
state or local tax laws, regulations, or rules, and shall furnish
or
cause to be furnished to Certificateholders the schedules,
statements
or information at such times and in such manner as may be
required
thereby;
(ii) within thirty days of the Closing Date, shall furnish or
cause to be furnished to the Internal Revenue Service, on Form 8811
or
as otherwise may be required by the Code, the name, title, address,
and
telephone number of the person that the holders of the Certificates
may
contact for tax information relating thereto (and the Servicer
shall
act as the representative of the Trust Fund for this purpose),
together
with such additional information as may be required by such Form,
and
shall update such information at the time or times in the
manner
required by the Code;
(iii) make or cause to be made an election, on behalf of the
Trust Fund, to be treated as a REMIC, and make the appropriate
designations, if applicable, in accordance with this Section 2.04
on
the federal tax return of the Trust Fund for its first taxable
year
(and, if necessary, under applicable state law);
30
<PAGE>
(iv) prepare and forward, or cause to be prepared and
forwarded, to the Certificateholders and to the Internal
Revenue
Service and, if necessary, state tax authorities, all
information
returns or reports, or furnish or cause to be furnished by
telephone,
mail, publication or other appropriate method such information, as
and
when required to be provided to them in accordance with the
REMIC
Provisions, including without limitation, the calculation of
any
original issue discount;
(v) provide information necessary for the computation of tax
imposed on the transfer of the Class A-R Certificate to a
Disqualified
Organization, or an agent (including a broker, nominee or other
middleman) of a Disqualified Organization, or a pass-through entity
in
which a Disqualified Organization is the record holder of an
interest
(the reasonable cost of computing and furnishing such information
may
be charged to the Person liable for such tax);
(vi) ensure that federal, state or local income tax or
information returns shall be signed by the Trustee or such other
person
as may be required to sign such returns by the Code or state or
local
laws, regulations or rules; and
(vii) maintain such records relating to the Trust Fund, as may
be required by the Code and, as may be necessary to prepare the
foregoing returns, schedules, statements or information.
Section 2.05. Permitted Activities of Trust.
The Trust is created for the object and purpose of engaging in
the
Permitted Activities.
Section 2.06. Qualifying Special Purpose Entity.
For purposes of SFAS 140, the parties hereto intend that the
Trust
shall be treated as a "qualifying special
purpose entity" as such term is used
in SFAS 140 and any successor rule thereto
and its power and authority as stated
in Section 2.05 of this Agreement shall be
limited in accordance with paragraph
35 thereof.
[END OF ARTICLE II]
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR AND
THE SERVICER; REPURCHASE OF MORTGAGE LOANS
Section 3.01. Representations and Warranties of the Depositor
with
respect to the Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee for
the
benefit of the Certificateholders that on
the Closing Date it has entered into
the Sale Agreement with CHF as Seller, that
the Seller has made the following
representations and warranties with respect
to each Mortgage Loan in such Sale
Agreement as of the Closing Date, which
representations and warranties run to
and are for the benefit of the Depositor
and the Trustee for the benefit of the
Certificateholders, and as to which the
Depositor has assigned to the Trustee
for the benefit of the Certificateholders,
pursuant to Section 2.01 hereof, the
right to cause the Seller to repurchase a
Mortgage Loan as to which there has
occurred an uncured breach of
representations and warranties in accordance with
the provisions of the Sale Agreement.
31
<PAGE>
[Insert Representations and Warranties]
Upon discovery by any of the Depositor, the Servicer or the Trustee
of
a breach of any of the foregoing
representations and warranties which materially
and adversely affects the value of a
Mortgage Loan or the interest of the
Certificateholders (or which materially and
adversely affects the interests of
the Certificateholders in the related
Mortgage Loan in the case of a
representation and warranty relating to a
particular Mortgage Loan), the party
discovering such breach shall give prompt
written notice to the other parties
and to the Seller, which notice shall
specify the date of discovery. Pursuant to
the Sale Agreement, the Seller shall within
90 days from the earlier of (i) the
date specified in the notice as the date of
discovery of such breach or (ii) the
date the Seller otherwise discovers such
breach, cure such breach, substitute a
Mortgage Loan pursuant to the provisions of
Section 3.03 or, if the breach
relates to a particular Mortgage Loan,
purchase such Mortgage Loan from the
Trustee at the Purchase Price. The Purchase
Price for the purchased Mortgage
Loan shall be paid to the Servicer and
shall be deposited by the Servicer in the
Collection Account promptly upon receipt,
and, upon receipt by the Trustee of
written notification of such deposit signed
by a Servicing Officer, the Trustee
shall promptly release to the Seller the
related Mortgage File, and the Trustee
shall execute and deliver such instruments
of transfer or assignment as may be
provided to it by the Servicer, without
recourse, as shall be necessary to vest
in the Seller or its designee, as the case
may be, any Mortgage Loan released
pursuant hereto, and the Trustee shall have
no further responsibility with
regard to such Mortgage Loan. It is
understood and agreed that the obligation of
the Seller to cure, substitute or purchase
any Mortgage Loan as to which such a
breach has occurred shall constitute the
sole remedy respecting such breach
available to Certificateholders or the
Trustee on behalf of Certificateholders.
Section 3.02. Representations and Warranties of the Servicer.
The Servicer represents and warrants to, and covenants with,
the
Trustee for the benefit of the
Certificateholders that as of the Closing Date:
(a) The Servicer is a corporation duly chartered and validly
existing
in good standing under the laws of the
State of New Jersey, and the Servicer is
duly qualified or registered as a foreign
corporation in good standing in each
jurisdiction in which the ownership or
lease or its properties or the conduct of
its business requires such
qualification;
(b) The execution and delivery of this Agreement by the Servicer
and
its performance and compliance with the
terms of this Agreement will not violate
the Servicer's corporate charter or by-laws
or constitute a default (or an event
which, with notice or lapse of time, or
both, would constitute a default) under,
or result in the breach of, any material
contract, agreement or other instrument
to which the Servicer is a party or which
may be applicable to the Servicer or
any of its assets;
(c) This Agreement, assuming due authorization, execution and
delivery
by the Trustee and the Depositor,
constitutes a valid, legal and binding
obligation of the Servicer, enforceable
against it in accordance with the terms
hereof subject to applicable bankruptcy,
insolvency, reorganization, moratorium
and other laws affecting the enforcement of
creditors' rights generally and to
general principles of equity, regardless of
whether such enforcement is
considered in a proceeding in equity or at
law;
(d) The Servicer 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, which default might
have consequences that would
materially and adversely affect the
condition (financial or other) or operations
of the Servicer or its properties or might
have consequences that would affect
its performance hereunder; and
32
<PAGE>
(e) No litigation is pending or, to the best of the Servicer's
knowledge, threatened against the Servicer
which would prohibit its entering
into this Agreement or performing its
obligations under this Agreement.
It is understood and agreed that the representations and warranties
set
forth in this Section 3.02 shall survive
the issuance and delivery of the
Certificates and shall be continuing as
long as any Certificate shall be
outstanding or this Agreement has been
terminated.
Section 3.03. Option to Substitute.
If the Seller is required to repurchase any Mortgage Loan pursuant
to
Section 2.02 or 3.01, the Seller may, at
its option, within two years from the
Closing Date, remove such defective
Mortgage Loan from the terms of this
Agreement and substitute another mortgage
loan for such defective Mortgage Loan,
in lieu of repurchasing such defective
Mortgage Loan. Any substitute Mortgage
Loan shall (a) have a Principal Balance at
the time of substitution not in
excess of the Principal Balance of the
removed Mortgage Loan (the amount of any
difference, plus one month's interest
thereon at the Mortgage Rate borne by the
removed Mortgage Loan, being paid by the
Seller and deemed to be a Principal
Prepayment to be deposited by the Servicer
in the Collection Account), (b) have
a Mortgage Rate not less than, and not more
than one percentage point greater
than, the Mortgage Rate of the removed
Mortgage Loan (provided, however, that if
the Mortgage Rate on the substitute
Mortgage Loan exceeds the Mortgage Rate on
the removed Mortgage Loan, the amount of
that excess interest (the "Substitute
Excess Interest") shall be payable to the
Residual Interest), (c) have a
remaining term to stated maturity not later
than, and not more than one year
less than, the remaining term to stated
maturity of the removed Mortgage Loan,
(d) be, in the reasonable determination of
the Servicer, of the same type,
quality and character (including location
of the Mortgaged Property (or
Underlying Mortgaged Property, in the case
of a Co-op Loan)) as the removed
Mortgage Loan as if the breach had not
occurred, (e) have a Loan-to-Value Ratio
at origination no greater than that of the
removed Mortgage Loan and (f) be, in
the reasonable determination of the
Servicer, in material compliance with the
representations and warranties contained in
the Sale Agreement and described in
Section 3.01, as of the date of
substitution.
The Servicer shall amend the Mortgage Loan Schedule to reflect
the
withdrawal of the removed Mortgage Loan
from this Agreement and the substitution
of such substitute Mortgage Loan therefor
and shall send a copy of such amended
Mortgage Loan Schedule to the Trustee. The
Sale Agreement provides that upon
such amendment the Seller shall be deemed
to have made as to such substitute
Mortgage Loan the representations and
warranties set forth in Section 3.01 as of
the date of such substitution, which shall
be continuing as long as any
Certificate shall be outstanding or this
Agreement has not been terminated, and
the remedies for breach of any such
representation or warranty shall be as set
forth in Section 3.01. Upon such amendment,
the Trustee shall review the
Mortgage File delivered to it relating to
the substitute Mortgage Loan, within
the time and in the manner and with the
remedies specified in Section 2.02,
except that for purposes of this Section
3.03 (other than the two-year period
specified in the first sentence of this
Section), such time shall be measured
from the date of the applicable
substitution. In the event of such a
substitution, accrued interest on the
substitute Mortgage Loan for the month in
which the substitution occurs and any
Principal Prepayments made thereon during
such month shall be the property of the
Trust Fund, and accrued interest for
such month on the Mortgage Loan for which
the substitution is made and any
Principal Prepayments made thereon during
such month shall be the property of
the Seller. The principal payment on a
substitute Mortgage Loan due on the Due
Date in the month of substitution shall be
the property of the Seller, and the
principal payment on the Mortgage Loan for
which the substitution is made due on
such date shall be the property of the
Trust Fund.
33
<PAGE>
[END OF ARTICLE III]
ARTICLE IV
THE CERTIFICATES
Section 4.01. The Certificates.
(a) The Class A, Class M and Class B Certificates shall be
substantially in the forms thereof included
within Exhibits C, D, E and F and
shall, on original issue, be executed by
the Depositor and authenticated by the
Trustee (or, if an Authenticating Agent has
been appointed pursuant to Section
4.06, the Authenticating Agent) upon
receipt by the Trustee of the documents
specified in Section 2.01, delivered to or
upon the order of the Depositor.
(b) The Depository, the Depositor, the Paying Agent and the
Trustee
have entered into a Depository Agreement
dated as of [DATE] (the "Depository
Agreement"). Except as provided in
paragraph (c) below, the Book-Entry
Certificates shall at all times remain
registered in the name of the Depository
or its nominee and at all times: (i)
registration of the Book-Entry Certificates
may not be transferred as provided in
Section 4.02 except to a successor to the
Depository; (ii) ownership and transfers of
registration of the Book-Entry
Certificates on the books of the Depository
shall be governed by applicable
rules established by the Depository; (iii)
the Depository may collect its usual
and customary fees, charges and expenses
from its Depository Participants; (iv)
the Trustee shall deal with the Depository,
Depository Participants and Indirect
Participants as representatives of the
Certificate Owners of the Book-Entry
Certificates for purposes of exercising the
rights of such Holders under this
Agreement, and requests and directions for
and votes of such representatives
shall not be deemed to be inconsistent if
they are made with respect to
different Certificate Owners; and (v) the
Trustee may rely and shall be fully
protected in relying upon information
furnished by the Depository with respect
to its Depository Participants and
furnished by the Depository Participants with
respect to Indirect Participants and
persons shown on the books of such Indirect
Participants as direct or indirect
Certificate Owners. The Depository Agreement
provides that the Depository shall maintain
book-entry records with respect to
the Certificate Owners and with respect to
ownership and transfers of such
Certificates.
All transfers by Certificate Owners of Book-Entry Certificates
shall be
made in accordance with the procedures
established by the Depository Participant
or brokerage firm representing such
Certificate Owners. Each Depository
Participant shall only transfer Book-Entry
Certificates of Certificate Owners it
represents or of brokerage firms for which
it acts as agent in accordance with
the Depository's normal procedures.
(c) If (i)(A) the Depository advises the Depositor, the Paying
Agent or
the Trustee in writing that the Depository
is no longer willing or able to
properly discharge its responsibilities as
Depository and (B) the Trustee, the
Paying Agent or the Depositor are unable
after exercise of their reasonable best
efforts to locate a qualified successor or
(ii) the Depositor at its option
advises the Trustee in writing that it
elects to terminate the book-entry system
through the Depository, the Trustee or, if
a Paying Agent has been appointed
under Section 4.05, the Paying Agent, shall
notify all Certificate Owners,
through the Depository, of the occurrence
of any such event and of the
availability of definitive, fully
registered Certificates (the "Definitive
Certificates") to Certificate Owners
requesting the same. Upon surrender to the
Trustee or, if a Paying Agent has been
appointed under Section 4.05, the Paying
Agent, of the Book-Entry Certificates by
the Depository for registration and
receipt by the Trustee or, if a Paying
Agent has been appointed under Section
4.05, the Paying Agent, of an adequate
supply of certificates from the
Depositor, the Trustee or if the Paying
Agent is appointed under Section 4.05,
the Paying Agent shall issue the Definitive
Certificates based on information
received from the Depository. Neither the
Depositor, the Servicer, the Paying
Agent nor the Trustee shall be liable for
any delay in delivery of such
instructions and may conclusively rely on,
and shall be protected in relying on,
such instructions.
34
<PAGE>
(d) The Certificates (other than the Class A-R Certificate) shall
be
issuable in the minimum original dollar
denominations (and integral multiples of
$________ in excess of such amount) and
aggregate original dollar denominations
per Class as set forth in the following
table (except that one Certificate of
each of the Class A-P and Class B-5
Certificates may be issued in a different
denomination). A single Class A-R
Certificate will be issued in definitive form
in a $___ denomination.
Aggregate Original Certificate
Minimum
Principal Balance of all
Original
Certificates of the
CUSIP
Class
Denomination
Indicated Class
Number
-----
------------
------------------------------ -----------
A-1
$_________
$________________
16162T __ _
A-2
$_________
$________________
16162T __ _
A-3
$_________
$________________
16162T __ _
A-4
$_________
$________________
16162T __ _
A-P(2)
$_________
$________________
16162T __ _
A-R(3)
$______
$________________
16162T __ _
A-X
(1)
(1)
16162T __ _
M
$_________
$________________
16162T __ _
B-1
$_________
$________________
16162T __ _
B-2
$_________
$________________
16162T __ _
B-3
$__________
$________________
16162T __ _
B-4
$__________
$________________
16162T __ _
B-5
$__________
$________________
16162T __ _
---------------
(1) The Class
A-X Certificates have no Principal Balance, but accrue
interest on the Class A-X Notional Amount (initially,
$______________).
(2) The Class
A-P Certificates are principal only certificates and are not
entitled to payments of interest.
(3) The Class
A-R Certificate represents the Residual Interest.
The Certificates shall be signed by manual or facsimile signature
on
behalf of the Depositor by an officer of
the Depositor. Certificates bearing the
manual or facsimile signatures of
individuals who were at the time of signature
officers of the Depositor shall bind the
Depositor, notwithstanding that such
individuals or any of them have ceased to
be an officer prior to the
authentication and delivery of such
Certificate or did not hold such offices at
the date of such Certificates. No
Certificate shall be entitled to any benefit
under this Agreement, or be valid for any
purpose, unless there appears on such
Certificate a manual authentication by an
officer of the Trustee (or, if an
Authenticating Agent has been appointed
pursuant to Section 4.06, the
Authenticating Agent) and such
authentication upon any Certificate shall be
conclusive evidence, and the only evidence,
that such Certificate has been duly
authenticated and delivered hereunder. All
Certificates shall be dated the date
of their authentication.
Section 4.02. Registration of Transfer and Exchange of
Certificates.
(a) The Trustee or, if a Paying Agent has been appointed
hereunder
pursuant to Section 4.05, the Paying Agent,
shall cause to be kept a Certificate
Register in which, subject to such
reasonable regulations as it may prescribe,
the Trustee shall provide for the
registration of Certificates and of transfers
and exchanges of Certificates as herein
provided.
35
<PAGE>
(b) Upon surrender for registration of transfer of any Certificate
at
any office or agency of the Trustee or, if
a Paying Agent has been appointed
under Section 4.05, the Paying Agent,
maintained for such purpose, the Depositor
shall execute and the Trustee (or, if an
Authenticating Agent is appointed under
Section 4.06, the Authenticating Agent)
shall authenticate and deliver, in the
name of the designated transferee or
transferees, a Certificate of a like Class
and aggregate Percentage Interest and dated
the date of authentication.
(c) No transfer of a Class A-X, Class B-3, Class B-4 or Class
B-5
Certificate shall be made unless such
transfer is made pursuant to an effective
registration statement or otherwise in
accordance with the requirements under
the Securities Act of 1933, as amended. If
such a transfer is to be made in
reliance upon an exemption from said Act,
(i) the Depositor may require (except
with respect to the initial transfer of a
Class B-3, Class B-4 or Class B-5
Certificate from [Placement Agent] and
except if the transferee executes a
certificate substantially in the form of
Exhibit I hereto) a written opinion of
independent counsel acceptable to and in
form and substance satisfactory to the
Depositor that such transfer may be made
pursuant to an exemption, describing
the applicable exemption and the basis
therefor, from said Act and laws or is
being made pursuant to said Act and laws,
which opinion of counsel shall not be
an expense of the Trust Fund, the Trustee,
the Depositor or the Servicer, and
(ii) the Depositor shall require the
transferee to execute a certification
substantially in the form of Exhibit H or
Exhibit I.
(d) No transfer of an ERISA Restricted Certificate or the Class
A-R
Certificate shall be made unless the
Depositor or, if a Paying Agent has been
appointed under Section 4.05, the Paying
Agent shall have received either (i) a
representation letter, substantially in the
form of Exhibit M, from the
transferee of such Certificate acceptable
to and in form and substance
satisfactory to the Depositor, to the
effect that (A) such transferee is not an
employee benefit plan subject to Title I of
ERISA or Section 4975 of the Code or
any materially similar provisions of
applicable federal, state or local law
("Similar Law"), or a person acting on
behalf of any such plan or using the
assets of such plan, or in the case of an
insurance company, the assets of any
separate accounts, or alternatively, (B) in
the case of an ERISA Restricted
Certificate only, such transferee is an
insurance company and the source of
funds for the purchase of such Certificate
is an "insurance company general
account" within the meaning of Prohibited
Transaction Class Exemption 95-60
("PTCE 95-60"), 60 Fed. Reg. 35925 (July
12, 1995), and the acquisition and
holding of such Certificate is exempt under
PTCE 95-60, which representation
letter shall not be an expense of the
Trustee, the Depositor or the Servicer, or
(ii) in the case of an ERISA Restricted
Certificate presented for registration
in the name of an employee benefit plan
subject to Title I of ERISA or Section
4975 of the Code or Similar Law (or
comparable provisions of any subsequent
enactments) or a trustee of any such plan
or any other Person who is using the
assets of any such plan to effect such
acquisition, an Opinion of Counsel or
such other representation as required by
and satisfactory to the Depositor to
the effect that the purchase and holding of
such ERISA Restricted Certificate
will not result in the assets of the Trust
Fund being deemed to be "plan assets"
pursuant to the Department of Labor
regulations set forth in 29 C.F.R.
"2510.3-101 or to be subject to the
fiduciary responsibility provisions of ERISA
or the prohibited transaction provisions of
ERISA or the Code or Similar Law,
will not constitute or result in a
prohibited transaction within the meaning of
Section 406 or 407 of ERISA or Section 4975
of the Code or Similar Law, and will
not subject the Trustee, the Depositor or
the Servicer to any obligation in
addition to those undertaken in this
Agreement, which Opinion of Counsel or
other representation shall not be an
expense of the Trustee, the Depositor or
the Servicer.
(e) At the option of a Certificateholder, a Certificate may be
exchanged for another Certificate or
Certificates of authorized denominations of
a like Class, upon surrender of the
Certificate to be exchanged at any office or
agency of the Trustee or, if a Paying Agent
has been appointed under Section
4.05, the Paying Agent, maintained for such
purpose. Whenever the Certificate is
so surrendered for exchange, the Depositor
shall execute and the Authenticating
Agent shall authenticate and deliver, the
Certificate which the
Certificateholder making the exchange is
entitled to receive. Every Certificate
presented or surrendered for transfer or
exchange shall (if so required by the
Authenticating Agent) be duly endorsed by,
or be accompanied by a written
instrument of transfer in the form
satisfactory to the Authenticating Agent duly
executed by, the Holder thereof or his
attorney duly authorized in writing.
36
<PAGE>
(f) No service charge shall be made to the Holder for any transfer
or
exchange of a Certificate, but the Servicer
may require payment by the
Certificateholders of a sum sufficient to
cover any tax or governmental charge
that may be imposed in connection with any
transfer or exchange of such
Certificate.
(g) All Certificates surrendered for transfer or exchange shall
be
destroyed by the Trustee or, if a Paying
Agent has been appointed under Section
4.05, the Paying Agent, in accordance with
the Trustee's or, if a Paying Agent
has been appointed under Section 4.05, the
Paying Agent's, standard procedures.
(h) [Reserved].
(i) A Disqualified Organization is prohibited from acquiring
beneficial
ownership of a Class A-R Certificate.
Notwithstanding anything to the contrary
contained herein, (i) unless and until the
Servicer shall have received an
Opinion of Counsel, satisfactory to it in
form and substance, to the effect that
the absence of the conditions contained in
this Section 4.02(i) would not result
in the imposition of federal tax upon the
Trust Fund or cause the Trust Fund to
fail to qualify as a REMIC, no transfer,
sale or other disposition of the Class
A-R Certificate (including for purposes of
this section any beneficial interest
therein) may be made without the express
written consent of the Certificate
Registrar or, if no Certificate Registrar
is appointed, the Trustee, which
consent is to be granted by the Certificate
Registrar or, if no Certificate
Registrar is appointed, the Trustee only
upon compliance with the requirements
of this Section and (ii) no transfer, sale
or other disposition of the Class A-R
Certificate (or any beneficial interest
therein) may be made to a Person who is
not a U.S. Person unless such Person
furnishes the transferor and the
Certificate Registrar or, if no Certificate
Registrar is appointed, the Trustee,
with a duly completed and effective Form
W-8ECI (or any successor thereto) or an
Opinion of Counsel to the effect that the
transfer will not be disregarded for
federal income tax purposes. As a condition
to granting its consent to a
transfer of a Class A-R Certificate, the
Certificate Registrar or, if no
Certificate Registrar is appointed, the
Trustee, shall require the proposed
transferee of such Certificate (including,
in the case of the initial issuance
of the Class A-R Certificate, the initial
Holder thereof) to execute a letter
and affidavit substantially in the form
attached hereto as Exhibit K. In the
absence of a contrary instruction from the
transferor of such Certificate,
declaration (11) in such affidavit may be
left blank. If the transferor requests
by written notice to the Certificate
Registrar or, if no Certificate Registrar
is appointed, the Trustee, prior to the
date of the proposed transfer that one
of the two other forms of declaration (11)
of such affidavit be used, then the
Certificate Registrar or, if no Certificate
Registrar is appointed, the Trustee,
shall require that such form of declaration
(11) be included in such affidavit.
37
<PAGE>
As a condition to the granting of the consent referred to in
this
Section 4.02(i), prior to the transfer,
sale, pledge, hypothecation or other
disposition of the Class A-R Certificate or
any interest therein, the
Certificate Registrar or, if no Certificate
Registrar is appointed, the Trustee
shall require that (1) the proposed
transferee deliver to the Trustee its
taxpayer identification number and state,
under penalties of perjury that such
number is the social security or employer
identification number, as the case may
be, of the transferee or provide an
affidavit under penalties of perjury stating
that as of the date of such transfer such
transferee is not and has no intention
of becoming a Disqualified Organization;
(2) the proposed transferee deliver to
the Trustee an affidavit stating (i) that
such transferee is not acquiring such
Class A-R Certificate as an agent, broker,
nominee, or middleman for a
Disqualified Organization, (ii) if the
Class A-R Certificate is a "non-economic
residual interest" within the meaning of
Treas. Reg. "1.860E-1(c)(2), (X) that
no purpose of the acquisition of the Class
A-R Certificate is to avoid or impede
the assessment or collection of tax, (Y)
that such transferee has historically
paid its debts as they came due and will
continue to pay its debts as they come
due, and (Z) that such transferee
represents that it understands that, as the
holder of the non-economic residual
interest, the transferee may incur tax
liabilities in excess of any cash flows
generated by the interest and that the
transferee intends to pay taxes associated
with holding the residual interest,
and (iii) unless the Certificate Registrar
or, if no Certificate Registrar is
appointed, the Trustee consents to the
transfer of the Class A-R Certificate to
a Person who is not a U.S. Person and who
has furnished either a duly completed
and effective Form W-8ECI (or any successor
thereto) or an Opinion of Counsel to
the effect that the transfer will not be
disregarded for federal income tax
purposes, that it is a U.S. Person; (3) if
so requested by the transferor in
written notice provided to the Certificate
Registrar or, if no Certificate
Registrar is appointed, the Trustee, prior
to the date of the proposed transfer,
the proposed transferee deliver to the
Trustee an affidavit that includes a
declaration made in the form of declaration
(11) in the affidavit set forth in
Exhibit K requested by the transferor; and
(4) the transferor deliver to the
Certificate Registrar or, if no Certificate
Registrar is appointed, the Trustee
a written certification that as of the date
of such transfer it has no knowledge
and no reason to know that the affirmations
described in clauses (1), (2) and
(3) were false. The Certificate Registrar
or, if no Certificate Registrar is
appointed, the Trustee shall not grant the
consent referred to in this Section
4.02(i) if it has actual knowledge that any
statement made in the affidavit
issued pursuant to the preceding sentence
is not true. Notwithstanding any
purported transfer, sale or other
disposition of the Class A-R Certificate to a
Disqualified Organization, such transfer,
sale or other disposition shall be
deemed to be of no legal force or effect
whatsoever and such Disqualified
Organization shall not be deemed to be a
Class A-R Certificateholder for any
purpose hereunder, including, but not
limited to, the receipt of distributions
on such Class A-R Certificate. If any
purported transfer shall be in violation
of the provisions of this Section 4.02(i)
then the prior holder of the Class A-R
Certificate shall, upon discovery that the
transfer of such Class A-R
Certificate was not in fact permitted by
this Section 4.02(i), be restored to
all rights and obligations as a Holder
thereof retroactive to the date of the
purported transfer of such Class A-R
Certificate. The Trustee and the Servicer
shall be under no liability to any Person
for any registration or transfer of a
Class A-R Certificate that is not permitted
by this Section 4.02(i) or for
making payments due on such Class A-R
Certificate to the purported Holder
thereof or taking any other action with
respect to such purported Holder under
the provisions of this Agreement so long as
the transfer was not registered
under the written certification of the
Certificate Registrar or, if no
Certificate Registrar is appointed, the
Trustee as described in this Section
4.02(i). The prior Holder shall be entitled
to recover from any purported Holder
of a Class A-R Certificate that was in fact
not a permitted purported transferee
under this Section 4.02(i) at the time it
became a purported Holder all payments
made to such purported Holder on such Class
A-R Certificate; provided that the
Servicer shall not be responsible for such
recovery. Each Class A-R
Certificateholder, by the acceptance of the
Class A-R Certificate, shall be
deemed for all purposes to have consented
to the provisions of this Section
4.02(i) and to any amendment to this
Agreement deemed necessary by counsel of
the Trustee or the Servicer to ensure that
the Class A-R Certificate is not
transferred to a Disqualified Organization
and that any transfer of such Class
A-R Certificate will not cause the
imposition of a tax upon the Trust Fund or
cause the Trust Fund to fail to qualify as
a REMIC. The restrictions on transfer
of the Class A-R Certificate will cease to
apply and be void upon receipt by the
Certificate Registrar or, if no Certificate
Registrar is appointed, the Trustee
of an Opinion of Counsel to the effect that
such restrictions on transfer are no
longer necessary to avoid the risk of
material federal taxation to the Trust
Fund or prevent the Trust Fund from
qualifying as a REMIC.
(j) The Servicer shall make available upon written request to
each
Holder and each proposed transferee of a
Class A-X, Class B-3, Class B-4 or
Class B-5 Certificate such information as
may be required to permit the proposed
transfer to be effected pursuant to Rule
144A under the Securities Act of 1933,
as amended.
Section 4.03. Mutilated, Destroyed, Lost or Stolen
Certificates.
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If (a) any mutilated Certificate is surrendered to the Trustee or,
if a
Paying Agent has been appointed under
Section 4.05, the Paying Agent, or the
Trustee or, if a Paying Agent has been
appointed under Section 4.05, the Paying
Agent, receives evidence to its
satisfaction of the destruction, loss or theft
of any Certificate, and (b) there is
delivered to the Trustee or, if a Paying
Agent has been appointed under Section
4.05, the Paying Agent, such security or
indemnity as may be required by it to save
it harmless, then, in the absence of
notice to the Trustee or, if a Paying Agent
has been appointed under Section
4.05, the Paying Agent, that such
Certificate has been acquired by a bona fide
purchaser, the Trustee or, if a Paying
Agent has been appointed under Section
4.05, the Paying Agent, shall authenticate
and deliver, in exchange for or in
lieu of any such mutilated, destroyed, lost
or stolen Certificate, a new
Certificate of like tenor and Class. Upon
the issuance of any new Certificate
under this Section, the Trustee or, if a
Paying Agent has been appointed under
Section 4.05, the Paying Agent, may require
of the Certificateholder the payment
of a sum sufficient to cover any tax or
other governmental charge that may be
imposed in relation thereto and any other
expenses connected therewith. Any
replacement Certificate of any Class issued
pursuant to this Section shall
constitute complete and indefeasible
evidence of ownership of the Percentage
Interest in the distributions to which the
Certificateholders of such Class are
entitled, as if originally issued, whether
or not the mutilated, destroyed, lost
or stolen Certificate shall be found at any
time, and such mutilated, destroyed,
lost or stolen Certificate shall be of no
force or effect under this Agreement,
to the extent permitted by law.
Section 4.04. Persons Deemed Owners.
Prior to due presentation of a Certificate of any Class for
registration of transfer, the Depositor,
the Servicer, the Paying Agent and the
Trustee may treat the person in whose name
any Certificate is registered on the
Record Date as the owner of such
Certificate and the Percentage Interest in the
distributions to which the
Certificateholders of such Class are entitled on the
relevant date as the Holder of such
Certificate and the Percentage Interest
represented by such Certificate for the
purpose of receiving remittances
pursuant to Section 6.01 and for all other
purposes whatsoever, and neither the
Depositor, the Servicer nor the Trustee
shall be affected by notice to the
contrary.
Section 4.05. Appointment of Paying Agent and Certificate
Registrar;
Certificate Account.
The Trustee may appoint a Paying Agent and a Certificate
Registrar
hereunder, but such Paying Agent and such
Certificate Registrar shall not be the
Depositor, the Seller, or an Affiliate of
the Depositor or the Seller unless
such Paying Agent or such Certificate
Registrar is the Corporate Trust
Department of Chase. In the event of an
appointment of such Paying Agent, no
later than two Business Days prior to each
Distribution Date, the Servicer shall
deposit or cause to be deposited with the
Paying Agent from funds on deposit in
the Collection Account a sum up to the
Available Distribution Amount, such sum
to be held in trust for the benefit of
Certificateholders in a segregated
account (the "Certificate Account") which
shall be an Eligible Account in the
name of "[TRUSTEE], as Trustee, in trust
for and for the benefit of the
Certificateholders of Multi-Class Mortgage
Pass-Through Certificates, Chase
Mortgage Finance Corporation, Series
[_______] Certificate Account". The
Servicer shall cause the Paying Agent to
perform each of the obligations of the
Paying Agent set forth herein and shall be
liable to the Trustee and the
Certificateholders for failure of the
Paying Agent to perform such obligations.
If the Paying Agent is a party other than
the Trustee, the Trustee shall have no
liability in connection with the
performance or failure of performance of the
Paying Agent. The Trustee designates the
Corporate Trust Department of Chase as
the initial Paying Agent and initial
Certificate Registrar. Only the Trustee may
remove the Paying Agent and the Certificate
Registrar, and may do so at will.
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If, on any Distribution Date, the Paying Agent fails to distribute
to
Certificateholders the amounts then on
deposit in the Certificate Account for
the purposes specified herein, the Trustee
shall be obligated promptly upon its
knowledge thereof to distribute such
amounts to Certificateholders in the manner
and in such amounts based upon information
provided by the Servicer; provided
that in no event shall the Trustee be
obligated for purposes of this paragraph
to distribute to Certificateholders any
amounts other than those on deposit in
the Certificate Account or expend any funds
not reimbursable pursuant to Section
10.05 hereof, except as otherwise provided
herein. Notwithstanding anything in
this Agreement to the contrary, the Trustee
shall be liable to the Servicer and
the Certificateholders only for its
negligence in connection with the withdrawal
of funds from the Certificate Account by
the Trustee and the distribution of
such funds by the Trustee to
Certificateholders pursuant to this paragraph.
The Servicer shall cause each Paying Agent other than the Trustee
to
execute and deliver to the Servicer and the
Trustee on the Closing Date or, if
subsequently appointed, on the date of
appointment, a written instrument
executed by an officer of the Paying Agent
in which such Paying Agent shall
agree with the Servicer and the Trustee
that such Paying Agent will hold all
sums held by it for the payment to
Certificateholders in trust for the benefit
of the Certificateholders entitled thereto
until such sums shall be paid to such
Certificateholders.
Section 4.06. Authenticating Agents.
(a) The Trustee may appoint one or more Authenticating Agents
(each, an
"Authenticating Agent") which shall be
authorized to act on behalf of the
Trustee in authenticating the Certificates.
Wherever reference is made in this
Agreement to the authentication of
Certificates by the Trustee or the Trustee's
certificate of authentication, such
reference shall be deemed to include
authentication on behalf of the Trustee by
an Authenticating Agent and a
certificate of authentication executed on
behalf of the Trustee by an
Authenticating Agent. Each Authenticating
Agent must be an entity organized and
doing business under the laws of the United
States of America or of any state,
having a combined capital and surplus of at
least $15,000,000, authorized under
such laws to do a trust business and
subject to supervision or examination by
federal or state authorities. If the
Authenticating Agent is a party other than
the Trustee, the Trustee shall have no
liability in connection with the
performance or failure of performance of
the Authenticating Agent. [The Trustee
hereby appoints Chase as the initial
Authenticating Agent.]
(b) Any Person into which any Authenticating Agent may be merged
or
converted or with which it may be
consolidated, or any Person resulting from any
merger, conversion or consolidation to
which any Authenticating Agent shall be a
party, or any Person succeeding to the
corporate agency business of any
Authenticating Agent, shall continue to be
the Authenticating Agent without the
execution or filing of any paper or any
further act on the part of the Trustee
or the Authenticating Agent.
(c) Any Authenticating Agent may at any time resign by giving at
least
30 days' advance written notice of
resignation to the Trustee and the Depositor.
The Trustee may at any time terminate the
agency of any Authenticating Agent by
giving written notice of termination to
such Authenticating Agent and the
Depositor. Upon receiving a notice of
resignation or upon such a termination, or
in case at any time any Authenticating
Agent shall cease to be eligible in
accordance within the provisions of this
Section 4.06, the Trustee may appoint a
successor Authenticating Agent, shall give
written notice of such appointment to
the Depositor and shall mail notice of such
appointment to all Holders of
Certificates. Any successor Authenticating
Agent upon acceptance of its
appointment hereunder shall become vested
with all the rights, powers, duties
and responsibilities of its predecessor
hereunder, with like effect as if
originally named as Authenticating Agent.
No successor Authenticating Agent
shall be appointed unless eligible under
the provisions of this Section 4.06. No
Authenticating Agent shall have
responsibility or liability for any action taken
by it as such at the direction of the
Trustee. Any Authenticating Agent shall be
entitled to reasonable compensation for its
services and any such compensation
shall be payable solely by the Trustee,
without any right of reimbursement from
the Depositor, the Servicer or the Trust
Fund.
[END OF ARTICLE IV]
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ARTICLE V
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 5.01. Servicer to Service Mortgage Loans.
The Servicer shall service and administer the Mortgage Loans and
shall
have full power and authority, acting alone
or through Sub-Servicers as provided
in Section 5.02, to do any and all things
which it may deem necessary or
desirable in connection with such servicing
and administration, all in
accordance with Accepted Servicing
Practices. Without limiting the generality of
the foregoing, the Servicer in its own name
or in the name of a Sub-Servicer
shall, pursuant to a power of attorney
granted hereby by the Trustee for such
purposes, when the Servicer or the
Sub-Servicer, as the case may be, believes it
appropriate in its best judgment, execute
and deliver, on behalf of the
Certificateholders and the Trustee or any
of them, any and all instruments of
satisfaction or cancellation, or of partial
or full release or discharge and all
other comparable instruments, with respect
to the Mortgage Loans and with
respect to the Mortgaged Properties;
provided, however, that subject to the
provisions of this paragraph, the Servicer
may allow a modification with respect
to a Mortgage Loan if the Servicer would
take such action in the ordinary course
of its business if it were the owner of the
Mortgage Loan. The Servicer may
agree to a modification of any Mortgage
Loan (the "Relevant Mortgage Loan") upon
the request of the related Mortgagor,
provided that (i) the modification is in
lieu of a refinancing and the Mortgage Rate
on the Relevant Mortgage Loan, as
modified, is approximately a prevailing
market rate of newly-originated mortgage
loans having similar terms, (ii) the
aggregate of the adjusted bases of all
Modified Mortgage Loans (including the
Relevant Mortgage Loans) plus the
aggregate adjusted bases of any assets that
are not qualified mortgages or
permitted investments under Section 860G(a)
of the Code that are assets of the
Trust Fund established hereunder at all
times on any day is less than one
percent of the aggregate of the adjusted
bases of all assets of the Trust Fund
(including such Modified Mortgage Loans) on
such day, and (iii) the Servicer
purchases the Relevant Mortgage Loan from
the Trust Fund as described below.
Effective immediately after such
modification, and, in any event, on the same
Business Day on which the modification
occurs, all right, title and interest of
the Trustee in and to the Modified Mortgage
Loan shall automatically be deemed
transferred and assigned to the Servicer
and all benefits and burdens of
ownership thereof, including without
limitation the right to accrued interest
thereon from and including the date of
modification and the risk of default
thereon, shall pass to the Servicer. To
confirm such transfer and assignment,
the Servicer, as servicer hereunder, as
soon as practicable shall execute an
instrument of assignment of the Modified
Mortgage Loan without recourse in
customary form to the Servicer in its
individual capacity. The Servicer shall
deposit the Purchase Price for any Modified
Mortgage Loan in the Collection
Account pursuant to Section 5.08. Upon
receipt by the Trustee of written
notification of any such deposit signed by
a Servicing Officer, the Trustee
shall release to the Servicer the related
Mortgage File and shall execute and
deliver such instruments of transfer or
assignment, in each case without
recourse, as shall be necessary more fully
to vest in the Servicer any Modified
Mortgage Loan previously transferred and
assigned pursuant thereto.
The Servicer shall furnish to the Trustee for execution and
redelivery
to the Servicer or, at the request of the
Servicer, a Sub-Servicer, such
documents necessary or appropriate to
enable the Servicer to service and
administer the Mortgage Loans and the
Trustee shall not be responsible for the
Servicer's application thereof. The
Servicer agrees to remain eligible as either
a FNMA or FHLMC seller/servicer, or both,
for so long as it is Servicer.
All Servicing Advances made by the Servicer in effecting the
timely
payment of taxes, insurance and assessments
on the properties subject to the
Mortgage Loans shall not, for the purpose
of calculating monthly distributions
to Certificateholders, be added to the
amount owing under the related Mortgage
Loans, notwithstanding that the terms of
such Mortgage Loan so permit, and such
Servicing Advances shall be recoverable by
the Servicer to the extent permitted
by Sections 5.09 and 5.23.
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Section 5.02. Sub-Servicing Agreements Between Servicer and
Sub-Servicers; Enforcement of Sub-Servicer's Obligations.
(a) The Servicer may enter into Sub-Servicing Agreements with
Sub-Servicers for the servicing and
administration of all or part of the
Mortgage Loans; provided, however, that any
subservicer or other subcontractor
that performs any of the functions
indentified in Item 1122(d) of Regulation AB
must agree in writing that, if the Servicer
or the Depositor determines that
such subcontractor was "participating in
the servicing function" within the
meaning of Item 1122, such subcontractor
will comply with the provisions of
Sections 5.25 and 5.26 to the same extent
as if it were the Servicer. References
in this Agreement to actions taken or to be
taken by the Servicer in servicing
the Mortgage Loans include actions taken or
to be taken by a Sub-Servicer on
behalf of the Servicer. Each Sub-Servicing
Agreement will be upon such terms and
conditions as are not inconsistent with
this Agreement and as the Servicer and
the Sub-Servicer have agreed. The Servicer
shall notify the Trustee in writing
promptly upon the appointment of any
Sub-Servicer. For purposes of this
Agreement, the receipt by the Sub-Servicer
of any amount with respect to a
Mortgage Loan (other than amounts
representing servicing compensation or
reimbursement for an advance) shall be
treated as the receipt by the Servicer of
such amount. The Sub-Servicer shall deposit
all such funds in an Eligible
Account.
(b) As part of its servicing activities hereunder, the Servicer,
for
the benefit of the Trustee and the
Certificateholders, shall enforce the
obligations of each Sub-Servicer under the
related Sub-Servicing Agreement. Such
enforcement, including, without limitation,
the legal prosecution of claims,
termination of Sub-Servicing Agreements as
appropriate, and the pursuit of other
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 but
shall be reimbursed therefor only (i)
from a general recovery resulting from such
enforcement only to the extent, if
any, that such recovery exceeds all amounts
due in respect of the related
Mortgage Loans or (ii) from a specific
recovery of costs, expenses or attorneys'
fees against the party against whom such
enforcement is directed.
Section 5.03. Successor Sub-Servicers.
The Servicer shall be entitled to terminate any Sub-Servicing
Agreement
that may exist in accordance with the terms
and conditions of such Sub-Servicing
Agreement and without any limitation by
virtue of this Agreement.
Section 5.04. Liability of the Servicer.
Notwithstanding any Sub-Servicing Agreement, any of the provisions
of
this Agreement relating to agreements or
arrangements between the Servicer and a
Sub-Servicer or reference to actions taken
through a Sub-Servicer or otherwise,
the Servicer shall remain obligated and
liable to the Trustee and
Certificateholders for the servicing and
administering of the Mortgage Loans in
accordance with the provisions of this
Agreement without diminution of such
obligation or liability by virtue of such
Sub-Servicing Agreements or
arrangements or by virtue of
indemnification from the Sub-Servicer and to the
same extent and under the same terms and
conditions as if the Servicer alone
were servicing and administering the
Mortgage Loans. The Servicer shall be
entitled to enter into any agreement with a
Sub-Servicer for indemnification of
the Servicer and nothing contained in this
Agreement shall be deemed to limit or
modify such indemnification.
Section 5.05. No Contractual Relationship Between Sub-Servicer
and
Trustee or Certificateholders.
Any Sub-Servicing Agreement that may be entered into and any
other
transactions or services relating to the
Mortgage Loans involving a Sub-Servicer
in its capacity as such and not as an
originator shall be deemed to be between
the Sub-Servicer and the Servicer alone,
and the Trustee and Certificateholders
shall not be deemed parties thereto and
shall have no claims, rights,
obligations, duties or liabilities with
respect to the Sub-Servicer.
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<PAGE>
Section 5.06.
Termination of Sub-Servicing Agreement.
If the Servicer shall for any reason no longer be the Servicer
hereunder (including by reason of any Event
of Default), the Servicer shall
thereupon terminate each Sub-Servicing
Agreement that may have been entered
into, and the Trustee, its designee or the
successor servicer and the Trustee
shall not be deemed to have assumed any of
the Servicer's interest therein or to
have replaced the Servicer as a party to
any such Sub-Servicing Agreement.
Section 5.07. Collection of Mortgage Loan Payments.
Continuously from the date hereof until the principal and interest
on
all Mortgage Loans are paid in full, the
Servicer will proceed diligently to
collect all payments due under each of the
Mortgage Loans when the same shall
become due and payable; provided, however,
that the Servicer may elect, to the
extent consistent with Accepted Servicing
Practices, to waive any late payment
charge and shall, to the extent such
procedures shall be consistent with this
Agreement, follow such collection
procedures as it follows with respect to
conventional mortgage loans held in its own
portfolio. Any such arrangements
shall not diminish or otherwise affect the
Servicer's obligation to make
Advances pursuant to Section 6.03.
Section 5.08. Establishment of Collection Account; Deposit in
Collection Account.
With respect to all of the Mortgage Loans, the Servicer shall
segregate
and hold all funds collected and received
pursuant to a Mortgage Loan separate
and apart from any of its own funds and
general assets and shall establish and
maintain one or more Collection Accounts
for the benefit of the
Certificateholders (collectively, the
"Collection Account") which are Eligible
Accounts, in the form of a trust account,
in the name of "[TRUSTEE], as Trustee,
in trust for and for the benefit of the
Certificateholders of Multi-Class
Mortgage Pass-Through Certificates,
JPMorgan Chase Bank, N.A. as Servicer, Chase
Mortgage Finance Corporation, Series
[_______] - Collection Account." Such
Collection Account shall be established
with a commercial bank, a savings bank
or a savings and loan association. The
Servicer may invest, or cause the
institution maintaining the Collection
Account to invest, moneys in the
Collection Account in Eligible Investments,
which shall mature not later than
the second Business Day next preceding the
Distribution Date next following the
date of such investment and shall not be
sold or disposed of prior to its
maturity. All income and gain realized from
any such investment shall be for the
benefit of the Servicer as additional
compensation and shall be subject to its
withdrawal or order from time to time. The
amount of any losses incurred in
respect of any such investments (to the
extent not offset by income from other
such investments) shall be deposited in the
Collection Account by the Servicer
out of its own funds immediately as
realized; provided, however, that if the
Trustee becomes Servicer, the Trustee shall
not be required to deposit the
amount of any loss incurred prior to it
becoming Servicer.
The Servicer shall deposit or cause to be deposited in the
Collection
Account on a daily basis (and not later
than the second Business Day following
receipt), and retain therein:
(a) All payments which were received after the Cut-off Date on
account
of principal of the Mortgage Loans (other
than the principal portion of Monthly
Payments due on or before the Cut-off
Date), and all Principal Prepayments
collected on or after the Cut-off Date;
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(b) All payments which were received after the Cut-off Date on
account
of interest on the Mortgage Loans (net of
the Servicing Fee)(other than the
interest portion of Monthly Payments due on
or before the Cut-off Date);
(c) Net Liquidation Proceeds;
(d) All Insurance Proceeds received by the Servicer under any
title,
hazard or other insurance policy, including
amounts required to be deposited
pursuant to Sections 5.16 and 5.20, other
than proceeds to be held in the Escrow
Account or applied to the restoration or
repair of the Mortgaged Property (or
Underlying Mortgaged Property, in the case
of a Co-op Loan) or released to the
Mortgagor in accordance with the Servicer's
normal servicing procedures or
otherwise applied or held as required by
applicable law;
(e) All awards or settlements in respect of condemnation
proceedings
affecting any Mortgaged Property (or
Underlying Mortgaged Property, in the case
of a Co-op Loan), which are not released to
the Mortgagor in accordance with the
Servicer's normal servicing procedures;
(f) All Repurchase Proceeds;
(g) All Advances made by the Servicer pursuant to Section 6.03;
(h) All amounts representing revenues under the insurance
provided
pursuant to Section 5.19 to the extent of
any losses borne by any
Certificateholder;
(i) All revenues from any Mortgaged Property (or Underlying
Mortgaged
Property in the case of a Co-op Loan)
acquired by the Servicer by foreclosure or
deed in lieu of foreclosure net of any
Servicing Advances with respect to such
Mortgaged Property; and
(j) Any other amounts required to be deposited therein pursuant to
this
Agreement.
The Servicer shall maintain accounting records on a Mortgage
Loan-by-Mortgage Loan basis with respect to
the Collection Account. The Servicer
shall give notice to the Trustee, the
Depositor and each Rating Agency of any
change in the location of the Collection
Account, prior to the use thereof.
Notwithstanding anything to the contrary
herein, no Monthly Payment or any
portion thereof shall be permitted to
remain in the Collection Account for more
than 12 months. Any Monthly Payment or any
portion thereof that has remained in
the Collection Account for 12 months shall
be deemed a Principal Prepayment and
distributed to Certificateholders pursuant
to the provisions of this Agreement
on the Distribution Date immediately
following the end of such 12 month period.
Section 5.09. Permitted Withdrawals from the Collection
Account.
The Servicer may, from time to time, withdraw funds from the
Collection
Account for the following purposes:
(a) to reimburse itself for Advances made pursuant to Section
6.03
(including amounts to reimburse the related
Sub-Servicer for advances made
pursuant to the applicable Sub-Servicing
Agreement), the Servicer's and the
Sub-Servicer's right to receive
reimbursement pursuant to this subclause (i)
being limited to amounts received on
particular Mortgage Loans which represent
Late Collections (net of the Servicing
Fees) with respect to those particular
Mortgage Loans;
(b) to pay itself the Servicing Fee;
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(c) to reimburse itself for unreimbursed Servicing Advances, or to
pay
the related Sub-Servicer any unreimbursed
Servicing Advances, the Servicer's
right to receive reimbursement or make
payments to the Sub-Servicer pursuant to
this subclause (iii) with respect to any
Mortgage Loan being limited to related
Liquidation Proceeds, Insurance Proceeds,
and condemnation awards;
(d) to reimburse itself (or the related Sub-Servicer) or the
Depositor
for expenses incurred by and recoverable by
or reimbursable to it pursuant to
Section 5.01 or 5.16;
(e) to reimburse itself (or the related Sub-Servicer) for any
Nonrecoverable Advances;
(f) to pay to itself (or the related Sub-Servicer) income earned on
the
investment of funds deposited in the
Collection Account;
(g) to make deposits into the Certificate Account in the amounts
and in
the manner provided for herein;
(h) to make payments to itself or others pursuant to any provision
of
this Agreement, and to clear and terminate
the Collection Account upon the
termination of this Agreement; and
(i) to withdraw amounts deposited in error.
Section 5.10. Establishment of Escrow Account; Deposits in
Escrow
Account.
With respect to those Mortgage Loans on which the Servicer or
any
Sub-Servicer collects Escrow Payments, if
any, the Servicer shall, and shall
cause the Sub-Servicer to, segregate and
hold all funds collected and received
pursuant to each such Mortgage Loan which
constitute Escrow Payments separate
and apart from any of its own funds and
general assets and shall establish and
maintain one or more Escrow Accounts, in
the form of trust accounts. Such Escrow
Accounts shall be established with a
commercial bank, a mutual savings bank or a
savings and loan association the deposits
of which are insured by the FDIC in a
manner which shall provide maximum
available insurance thereunder, and which may
be drawn on by the Servicer. The Servicer
shall give notice to the Trustee of
the location of any Escrow Account, and of
any change thereof, prior to the use
thereof. Nothing in this paragraph shall be
deemed to require the Servicer to
collect Escrow Payments in the absence of a
provision in the related Mortgage
requiring such collection.
The Servicer shall deposit, or cause to be deposited, in any
Escrow
Account or Accounts on a daily basis, and
retain therein, (i) all Escrow
Payments collected on account of any
Mortgage Loans, for the purpose of
effecting timely payment of any such items
as required under the terms of this
Agreement and (ii) all amounts representing
proceeds of any hazard insurance
policy which are to be applied to the
restoration or repair of any Mortgaged
Property (or Underlying Mortgaged Property,
in the case of a Co-op Loan). The
Servicer shall make withdrawals therefrom
only to effect such payments as are
required under this Agreement, and for such
other purposes as are set forth in
Section 5.11. The Servicer shall be
entitled to retain any interest paid on
funds deposited in the Escrow Account by
the depository institution other than
interest on escrowed funds required by law
to be paid to the related Mortgagor
and, to the extent required by law, the
Servicer shall pay interest on escrowed
funds to the related Mortgagor
notwithstanding that the Escrow Account is
non-interest-bearing or that interest paid
thereon is insufficient for such
purposes.
Section 5.11. Permitted Withdrawals from Escrow Account.
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<PAGE>
Withdrawals from any Escrow Account or Accounts may be made by
the
Servicer only (i) to effect timely payments
of ground rents, taxes, assessments,
water rates, Standard Hazard Policy
premiums, or other items constituting Escrow
Payments for the related Mortgage, (ii) to
reimburse the Servicer for any
Servicing Advance made by the Servicer,
with respect to a related Mortgage Loan
but only from amounts received on the
related Mortgage Loan which represent late
payments or collections of Escrow Payments
thereunder, (iii) to refund to any
Mortgagor any funds found to be in excess
of the amounts required under the
terms of the related Mortgage Loan or under
applicable law, (iv) for application
to restoration or repair of the property
subject to the related Mortgage, (v) to
pay to the Servicer, or to the Mortgagor to
the extent required by law, any
interest paid on the funds deposited in the
Escrow Account, (vi) to clear and
terminate the Escrow Account on the
termination of this Agreement or (vii) to
withdraw amounts deposited in error.
Section 5.12. Payment of Taxes, Insurance and Other Charges.
With respect to each Mortgage Loan, the Servicer shall maintain,
or
cause to be maintained, accurate records
reflecting any delinquencies or
nonpayments with regard to taxes,
assessments and Standard Hazard Policy
premiums. The Servicer assumes full
responsibility for ensuring the payment of
all such bills and shall effect payments of
all such bills irrespective of each
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.
Section 5.13. Transfer of Accounts.
The Servicer may transfer the Collection Account or Escrow Account
to
an Eligible Account maintained with a
different depository institution from time
to time.
Section 5.14. [Reserved].
Section 5.15. Maintenance of the Primary Insurance Policies.
The Servicer shall not take, or permit any Sub-Servicer to take,
any
action which would result in non-coverage
under any applicable Primary Insurance
Policy of any loss which, but for the
actions of the Servicer or Sub-Servicer,
would have been covered thereunder. Except
as otherwise required by applicable
law, to the extent coverage is available
and until the Loan-to-Value Ratio of
the related Mortgage Loan is reduced to
80%, the Servicer shall keep or cause to
be kept in full force and effect each such
Primary Insurance Policy in an amount
equal to the amount by which the unpaid
principal balance of the related
Mortgage Loan exceeds 75% of the value (as
described in the definition of
Loan-to-Value Ratio) of the related
Mortgaged Property (or Underlying Mortgaged
Property, in the case of a Co-op Loan). The
Servicer shall not cancel or refuse
to renew any such Primary Insurance Policy
or consent to any Sub-Servicer
canceling or refusing to renew any such
Primary Insurance Policy applicable to a
Mortgage Loan subserviced by it, that is in
effect at the date of the initial
issuance of the Certificates and is
required to be kept in force hereunder
unless the replacement Primary Insurance
Policy for such canceled or non-renewed
policy is maintained with an insurer whose
claims-paying ability is rated at
least as high as the original insurer or is
acceptable to each Rating Agency as
confirmed in writing by each such Rating
Agency, unless otherwise required by
law.
Section 5.16. Maintenance of Standard Hazard Policies.
46
<PAGE>
(a) The Servicer shall cause to be maintained for each Mortgage
Loan
(other than a Co-op Loan) a Standard Hazard
Policy with extended coverage as is
prudent in the area where the Mortgaged
Property is located in an amount which
is equal to the greater of (i) the lesser
of (A) 100% of the maximum insurable
value of the improvements securing such
Mortgage Loan or (B) the principal
balance owing on such Mortgage Loan, or
(ii) such amount required to prevent the
Mortgagor or mortgagee from becoming a
co-insurer. If the Mortgaged Property is
in an area identified at the time of
origination in the Federal Register by the
Federal Emergency Management Agency as
having special flood hazards (and such
flood insurance has been made available)
the Servicer will cause to be
maintained a flood insurance policy meeting
the requirements of the current
guidelines of the Federal Insurance
Administration with a generally acceptable
insurance carrier, in an amount
representing coverage not less than the least of
(i) the outstanding Principal Balance of
the Mortgage Loan, (ii) the full
insurable value or (iii) the maximum amount
of insurance which is available
under the Flood Disaster Protection Act of
1973, as amended. The Servicer shall
also maintain on property acquired upon
foreclosure, or by deed in lieu of
foreclosure, of any Mortgage Loan, fire and
hazard insurance with extended
coverage in an amount which is not less
than the lesser of (i) the outstanding
principal balance of the Mortgage Loan or
(ii) the maximum insurable value of
the improvements which are a part of such
property, liability insurance, and, to
the extent available, flood insurance in an
amount as provided above. Any
amounts 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 property acquired in
liquidation of the Mortgage Loan, or released
to the Mortgagor in accordance with the
Servicer's normal servicing procedures)
shall be deposited, subject to applicable
law, in the Collection Account. It is
understood and agreed that no earthquake or
other additional insurance need be
required by the Servicer of any Mortgagor
or maintained on property acquired in
respect of a Mortgage Loan, other than
pursuant to such applicable laws and
regulations as shall at any time be in
force and as shall require such
additional insurance. All such Standard
Hazard Policies and other policies shall
be endorsed with standard mortgagee clauses
with loss payable to the Servicer or
its designee. Any such Standard Hazard
Policies or other policies may be in the
form of blanket policies; provided,
however, that in the event of any claim
arising in connection with a hazard loss
the Servicer shall be obligated, in the
case of blanket insurance policies, to
deposit in the Collection Account any
amount not payable under such blanket
policy because of a deductible clause in
such policy and not otherwise payable under
an individual policy. The Servicer
shall not interfere with the Mortgagor's
freedom of choice in selecting either
his insurance carrier or agent; provided,
however, that the Servicer shall not
accept any such insurance policies from
insurance companies unless such
companies are acceptable insurers in the
discretion of the Servicer.
(b) Any cost incurred by the Servicer in maintaining any of the
foregoing insurance shall not, for the
purpose of calculating monthly
distributions to Certificateholders, be
added to the amount owing under the
Mortgage Loan, notwithstanding that the
terms of the Mortgage Loan so permit.
Such costs (other than the costs of
maintaining a blanket hazard insurance
policy not attributable to a specific
Mortgaged Property) shall be recoverable
by the Servicer from the Mortgagor or out
of Insurance Proceeds or Liquidation
Proceeds or to the extent permitted by
Section 5.09.
Section 5.17. [Reserved].
Section 5.18. [Reserved].
Section 5.19. Fidelity Bond and Errors and Omissions Insurance.
The Servicer shall maintain, at its own expense, a blanket
fidelity
bond and an errors and omissions insurance
policy, with broad coverage with
responsible companies on all officers,
employees or other persons acting on
behalf of the Servicer in any capacity with
regard to the Mortgage Loans to
handle funds, money, documents and papers
relating to the Mortgage Loans. Any
such fidelity bond and errors and omissions
insurance shall protect and insure
the Servicer against losses, including
forgery, theft, embezzlement, fraud,
errors and omissions and negligent acts of
such persons and shall be maintained
at a level acceptable to FNMA. No provision
of this Section 5.19 requiring such
fidelity bond and errors and omissions
insurance shall diminish or relieve the
Servicer from its duties and obligations as
set forth in this Agreement. Upon
request of the Trustee, the Servicer shall
cause to be delivered to the Trustee
a certification evidencing coverage under
such fidelity bond and insurance
policy. Promptly upon receipt of any notice
from the surety or the insurer that
such fidelity bond or insurance policy has
been terminated or modified in a
materially adverse manner, the Servicer
shall notify the Trustee and each Rating
Agency of any such termination or
modification.
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Section 5.20. Collections under Insurance Policies; Enforcement
of
Due-On-Sale Clauses; Assumption Agreements.
(a) In connection with its activities as administrator and servicer
of
the Mortgage Loans, the Servicer agrees to
present, on behalf of itself, the
Trustee and the Certificateholders, claims
to the insurer under any Standard
Hazard Policies and, in this regard, to
take such reasonable action as shall be
necessary to permit recovery under any
insurance policies. Pursuant to Section
5.08, the Servicer shall deposit Insurance
Proceeds in the Collection Account.
(b) When any Mortgaged Property (or stock allocated to a dwelling
unit,
in the case of a Co-op Loan) is conveyed by
the Mortgagor, the Servicer shall
enforce any due-on-sale clause contained in
any Mortgage Note or Mortgage, to
the extent permitted by such Mortgage Note
or Mortgage, applicable law and
governmental regulations. Subject to the
foregoing, the Servicer is authorized
to take or enter into an assumption or
substitution agreement from or with the
Person to whom such property has been or is
about to be conveyed. In connection
with such assumption or substitution, the
Servicer shall apply such underwriting
standards and follow such practices and
procedures as shall be normal and usual
and a
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