Exhibit 4
---------
EXECUTION COPY
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GS MORTGAGE SECURITIES CORP.,
Depositor,
COUNTRYWIDE HOME LOANS SERVICING LP,
Servicer,
AMERIQUEST MORTGAGE COMPANY,
Responsible Party,
and
DEUTSCHE BANK NATIONAL TRUST COMPANY,
Trustee
------------------------------------------------
POOLING AND SERVICING AGREEMENT
Dated as of August 1, 2005
------------------------------------------------
GSAA HOME EQUITY TRUST 2005-10
ASSET-BACKED CERTIFICATES,
SERIES 2005-10
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<TABLE>
<CAPTION>
TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS
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Section 1.01
Definitions..................................................................................7
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES
Section 2.01
Conveyance of Mortgage
Loans................................................................42
Section 2.02
Acceptance by the Trustee of the Mortgage
Loans.............................................45
Section 2.03
Representations, Warranties and Covenants of the Responsible Party
and the Servicer.........46
Section 2.04
Non Qualified
Mortgages.....................................................................48
Section 2.05
Execution and Delivery of
Certificates......................................................48
Section 2.06
REMIC
Matters...............................................................................48
Section 2.07
Representations and Warranties of the
Depositor.............................................48
ARTICLE III
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 3.01
Servicer to Service Mortgage
Loans..........................................................50
Section 3.02
Subservicing Agreements between the Servicer and
Subservicers...............................51
Section 3.03
Successor
Subservicers......................................................................52
Section 3.04
Liability of the
Servicer...................................................................53
Section 3.05
No Contractual Relationship between Subservicers and the
Trustee............................53
Section 3.06
Assumption or Termination of Subservicing Agreements by
Trustee.............................53
Section 3.07
Collection of Certain Mortgage Loan
Payments................................................53
Section 3.08
Subservicing
Accounts.......................................................................55
Section 3.09
Collection of Taxes, Assessments and Similar Items; Escrow
Accounts.........................55
Section 3.10
Collection
Account..........................................................................56
Section 3.11
Withdrawals from the Collection
Account.....................................................57
Section 3.12
Investment of Funds in the Collection Account and the Distribution
Account..................59
Section 3.13
Maintenance of Hazard Insurance, Errors and Omissions and Fidelity
Coverage.................60
Section 3.14
Enforcement of Due on Sale Clauses; Assumption
Agreements...................................62
Section 3.15
Realization upon Defaulted Mortgage
Loans...................................................63
Section 3.16
Release of Mortgage
Files...................................................................64
Section 3.17
Title, Conservation and Disposition of REO
Property.........................................65
i
<PAGE>
Section 3.18
Notification of
Adjustments.................................................................67
Section 3.19
Access to Certain Documentation and Information Regarding the
Mortgage Loans................67
Section 3.20
Documents, Records and Funds in Possession of the Servicer to Be
Held for the Trustee.......68
Section 3.21
Servicing
Compensation......................................................................68
Section 3.22
Annual Statement as to
Compliance...........................................................69
Section 3.23
Annual Independent Public Accountants' Servicing Statement;
Financial Statements............69
Section 3.24
Trustee to Act as
Servicer..................................................................69
Section 3.25
Compensating
Interest.......................................................................70
Section 3.26
Credit Reporting; Gramm-Leach-Bliley
Act....................................................70
Section 3.27
Excess Reserve Fund Account; Distribution
Account...........................................70
Section 3.28
Optional Purchase of Delinquent Mortgage
Loans..............................................72
ARTICLE IV
DISTRIBUTIONS AND ADVANCES BY THE SERVICER
Section 4.01
Advances....................................................................................72
Section 4.02
Priorities of
Distribution..................................................................73
Section 4.03
Monthly Statements to
Certificateholders....................................................81
Section 4.04
Certain Matters Relating to the Determination of
LIBOR......................................84
Section 4.05
Allocation of Applied Realized Loss
Amounts.................................................85
ARTICLE V
THE CERTIFICATES
Section 5.01
The
Certificates............................................................................85
Section 5.02
Certificate Register; Registration of Transfer and Exchange of
Certificates.................86
Section 5.03
Mutilated, Destroyed, Lost or Stolen
Certificates...........................................91
Section 5.04
Persons Deemed
Owners.......................................................................91
Section 5.05
Access to List of Certificateholders' Names and
Addresses...................................91
Section 5.06
Maintenance of Office or
Agency.............................................................92
ARTICLE VI
THE DEPOSITOR AND THE SERVICER
Section 6.01
Respective Liabilities of the Depositor and the
Servicer....................................92
Section 6.02
Merger or Consolidation of the Depositor or the
Servicer....................................92
Section 6.03
Limitation on Liability of the Depositor, the Servicer and
Others...........................92
Section 6.04
Limitation on Resignation of the
Servicer...................................................93
Section 6.05
Additional Indemnification by the Servicer; Third Party
Claims..............................93
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ARTICLE VII
DEFAULT
Section 7.01
Events of
Default...........................................................................94
Section 7.02
Trustee to Act;
Appointment of
Successor....................................................96
Section 7.03
Notification to
Certificateholders..........................................................98
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.01
Duties of the
Trustee.......................................................................98
Section 8.02
Certain Matters Affecting the
Trustee.......................................................99
Section 8.03
Trustee Not Liable for Certificates or Mortgage
Loans......................................100
Section 8.04
Trustee May Own
Certificates...............................................................100
Section 8.05
Trustee's Fees and
Expenses................................................................101
Section 8.06
Eligibility Requirements for the
Trustee...................................................101
Section 8.07
Resignation and Removal of the
Trustee.....................................................102
Section 8.08
Successor
Trustee..........................................................................103
Section 8.09
Merger or Consolidation of the
Trustee.....................................................103
Section 8.10
Appointment of Co Trustee or Separate
Trustee..............................................103
Section 8.11
Tax
Matters................................................................................104
Section 8.12
Periodic
Filings...........................................................................108
Section 8.13
Tax Classification of the Excess Reserve Fund Account and the
Interest Rate Corridor
Agreement..................................................................................109
ARTICLE IX
TERMINATION
Section 9.01
Termination upon Liquidation or Purchase of the Mortgage
Loans.............................110
Section 9.02
Final Distribution on the
Certificates.....................................................111
Section 9.03
Additional Termination
Requirements........................................................112
ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.01
Amendment..................................................................................113
Section 10.02
Recordation of Agreement;
Counterparts.....................................................114
Section 10.03
Governing
Law..............................................................................115
Section 10.04
Intention of
Parties.......................................................................115
Section 10.05
Notices....................................................................................115
Section 10.06
Severability of
Provisions.................................................................116
Section 10.07
Assignment; Sales; Advance
Facilities......................................................116
Section 10.08
Limitation on Rights of
Certificateholders.................................................118
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iii
Section 10.09
Inspection and Audit
Rights................................................................119
Section 10.10
Certificates Nonassessable and Fully
Paid..................................................119
Section 10.11
Waiver of Jury
Trial.......................................................................119
SCHEDULES
Schedule I
Mortgage Loan Schedule
Schedule II
Representations and Warranties of Countrywide Home Loans Servicing
LP
Schedule III
Representations and Warranties of the Responsible Party as to the
Mortgage Loans
Schedule IV
Representations and Warranties of the Responsible Party
</TABLE>
EXHIBITS
Exhibit A Form
of Class A, Class M and Class B Certificates
Exhibit B Form
of Class R-1 and Class R-2 Certificates
Exhibit C Form
of Class P Certificates
Exhibit D Form
of Class X Certificates
Exhibit E Form
of Class C Certificates
Exhibit F Form
of Initial Certification of Trustee
Exhibit G Form
of Document Certification and Exception Report of Trustee
Exhibit H Form
of Residual Transfer Affidavit
Exhibit I Form
of Transferor Certificate
Exhibit J Form
of Rule 144A Letter
Exhibit K Form
of Request for Release
Exhibit L Form
of Contents for Each Mortgage File
Exhibit M
Countrywide Reporting Requirements
Exhibit N Form
of Certification to be provided with Form 10-K
Exhibit O Form
of Trustee Certification to be provided to Depositor
Exhibit P Form
of Servicer Certification to be provided to Depositor
iv
<PAGE>
THIS POOLING AND SERVICING AGREEMENT, dated as of August 1,
2005,
among GS MORTGAGE SECURITIES CORP., a
Delaware corporation (the "Depositor"),
COUNTRYWIDE HOME LOANS SERVICING LP, a
Texas limited partnership (the
"Servicer"), AMERIQUEST MORTGAGE COMPANY, a
Delaware corporation (the
"Responsible Party") and DEUTSCHE BANK
NATIONAL TRUST COMPANY, a national
banking association (the "Trustee"),
W I T N E S S E T H:
- - - - - - - - - -
In consideration of the mutual agreements herein contained, the
parties hereto agree as follows:
PRELIMINARY STATEMENT
The Trustee shall elect that two segregated asset pools within
the
Trust Fund be treated for federal income
tax purposes as comprising two REMICs
(each, a "Trust REMIC" or, in the
alternative, the "Lower-Tier REMIC" and the
"Upper-Tier REMIC", respectively). The
Class X Interest and each Class of
Principal Certificates (other than the
right of each Class of Principal
Certificates to receive Basis Risk Carry
Forward Amounts), represents
ownership of a regular interest in the
Upper-Tier REMIC for purposes of the
REMIC Provisions. The Class R-1
Certificates represent ownership of the sole
class of residual interest in the
Upper-Tier REMIC and the Class R-2
Certificates represent ownership of the
sole class of residual interest in the
Lower-Tier REMIC for purposes of the REMIC
Provisions. The Start-up Day for
each REMIC described herein is the Closing
Date. The latest possible maturity
date for each Certificate is the latest
date referenced in Section 2.06. The
Upper-Tier REMIC shall hold as assets the
several classes of uncertificated
Lower-Tier Regular Interests, set out
below. The Lower-Tier REMIC shall hold
as assets the assets described in the
definition of "Trust Fund" herein (other
than the Prepayment Premiums, the Interest
Rate Corridor Agreement and the
Excess Reserve Fund Account). Each such
Lower-Tier Regular Interest is hereby
designated as a regular interest in the
Lower-Tier REMIC. The Class LT-1A1,
Class LT-2A1, Class LT-2A2, Class LT-2A3,
Class LT-2A4, Class LT-2A5, Class
LT-M-1, Class LT-M-2, Class LT-M-3, Class
LT-M-4, Class LT-M-5, Class LT-M-6,
Class LT-B-1, Class LT-B-2, Class LT-B-3
and Class LT-B-4 Interests are hereby
designated the LT Accretion Directed
Classes (the "LT-Accretion Directed
Classes"). Each Class of Regular
Certificates represents a beneficial
ownership of a regular interest in the
Upper-Tier REMIC and the right to
receive Basis Risk Carry Forward Amounts,
the Class P Certificates represent a
beneficial ownership of the Prepayment
Premiums, the Class X Interest
represent beneficial ownership of a regular
interest in the Upper-Tier REMIC,
the Interest Rate Corridor Agreement and
the Excess Reserve Fund Account and
the Class C Certificates represent
beneficial ownership of the right to
receive payment of the Fair Market Value
Excess, on or after the Optional
Termination Date, by the Servicer of all of
the Mortgage Loans (and REO
Properties).
1
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<TABLE>
<CAPTION>
Corresponding
Lower-Tier
Interest
Lower-Tier
Upper-Tier
Designation
Interest Rate
Initial Lower-Tier Principal Amount
REMIC Class
---------------------------
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<S>
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<C>
<C>
Class LT-1A1
(1)
1/2 initial Class Certificate Balance of
1A1
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-2A1
(1)
1/2 initial Class Certificate Balance of
2A1
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-2A2
(1)
1/2 initial Class Certificate Balance of
2A2
Corresponding
Upper-Tier REMIC Regular
Interest
Class LT-2A3
(1)
1/2 initial Class Certificate Balance of
2A3
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-2A4
(1)
1/2 initial Class Certificate Balance of
2A4
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-2A5
(1)
1/2 initial Class Certificate Balance of
2A5
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-M-1
(1)
1/2 initial Class Certificate Balance of
M-1
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-M-2
(1)
1/2 initial Class Certificate Balance of
M-2
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-M-3
(1)
1/2 initial Class Certificate Balance of
M-3
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-M-4
(1)
1/2 initial Class Certificate Balance of
M-4
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-M-5
(1)
1/2 initial Class Certificate Balance of
M-5
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-M-6
(1)
1/2 initial Class Certificate Balance of
M-6
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-B-1
(1)
1/2
initial Class Certificate Balance of
B-1
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-B-2
(1)
1/2 initial Class Certificate Balance of
B-2
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-B-3
(1)
1/2 initial Class Certificate Balance of
B-3
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-B-4
(1)
1/2 initial Class Certificate Balance of
B-4
Corresponding Upper-Tier REMIC Regular
Interest
2
<PAGE>
Class LT-Accrual
(1)
1/2 Pool Stated Principal Balance plus 1/2
Overcollateralized Amount, less aggregate
initial Lower-Tier Principal Amounts of Class
LT-Group I and Class LT-Group II Interests
Class LT-Group I
(2)
0.001% aggregated Stated Principal Balance of
Group I Mortgage Loans (4)
Class LT-Group II
(3)
0.001% aggregated Stated Principal Balance of
Group II Mortgage Loans (4)
</TABLE>
-----------------------------
(1) The
interest rate with respect to any Distribution Date for these
interests is a per annum variable rate equal to the WAC Cap.
(2) The
interest rate with respect to any Distribution Date for the
Class
LT-Group I Interest is a per annum variable rate (expressed as
a
percentage rounded to eight decimal places) equal to the Loan Group
I
Cap.
(3) The
interest rate with respect to any Distribution Date for the
Class
LT-Group II Interest is a per annum variable rate (expressed as
a
percentage rounded to eight decimal places) equal to the Loan
Group
II Cap.
(4) For all
Distribution Dates, the Lower-Tier Principal Amount of these
Lower-Tier Regular Interests shall be rounded to eight decimal
places.
The Lower-Tier REMIC shall hold as assets all of the assets
included
in the Trust Fund, other than the
Prepayment Premiums, the Interest Rate
Corridor Agreement and the Excess Reserve
Fund Account.
On each Distribution Date, 50% of the increase in the
Overcollateralized Amount will be payable
as a reduction of the Lower-Tier
Principal Amount of the LT-Accretion
Directed Classes (each such Class will be
reduced by an amount equal to 50% of any
increase in the Overcollateralized
Amount that is attributable to a reduction
in the Class Certificate Balance of
its Corresponding Class) and will be
accrued and added to the Lower-Tier
Principal Amount of the Class LT-Accrual
Interest. On each Distribution Date,
the increase in the Lower-Tier Principal
Amount of the Class LT-Accrual
Interest may not exceed interest accruals
for such Distribution Date for the
Class LT-Accrual Interest. In the event
that: (i) 50% of the increase in the
Overcollateralized Amount exceeds (ii)
interest accruals on the Class
LT-Accrual Interest for such Distribution
Date, the excess for such
Distribution Date (accumulated with all
such excesses for all prior
Distribution Dates) will be added to any
increase in the Overcollateralized
Amount for purposes of determining the
amount of interest accrual on the Class
LT-Accrual Interest payable as principal on
the LT-Accretion Directed Classes
on the next Distribution Date pursuant to
the first sentence of this
paragraph. All payments of scheduled
principal and prepayments of principal
generated by the Mortgage Loans shall be
allocated (i) 50% to the Class
LT-Accrual Interest, the Class LT-Group I
Interest and Class LT-Group II
Interest (and further allocated among these
Lower-Tier Regular Interests in
the manner described below) and (ii) 50% to
the LT-Accretion Directed Classes
(principal payments shall be allocated
among such LT-Accretion Directed
Classes in an amount equal to 50% of the
principal amounts allocated to their
respective Corresponding Classes), until
paid in full. Notwithstanding the
above, principal payments allocated to the
Class X Interest that result in the
reduction in the Overcollateralized Amount
shall be allocated to the Class
LT-Accrual Interest (until paid in full).
Realized Losses shall be applied so
that after all distributions have been made
on each Distribution Date (i) the
Lower-Tier Principal Amount of each of the
LT-Accretion Directed Classes is
equal to 50% of
3
<PAGE>
the Class Certificate Balance of its
Corresponding Class, and (ii) the Class
LT-Accrual Interest, the Class LT-Group I
Interest and the Class LT-Group II
Interest (and further allocated among these
Lower-Tier Regular Interests in
the manner described below) is equal to 50%
of the aggregate Stated Principal
Balance of the Mortgage Loans plus 50% of
the Overcollateralized Amount. As
among the Class LT-Accrual Interest, the
Class LT-Group I Interest and the
Class LT-Group II Interest, all payments of
scheduled principal and
prepayments of principal generated by the
Mortgage Loans, and all Realized
Losses, allocable to such Lower-Tier
Regular Interests shall be allocated (i)
to the Class LT-Group I Interest and the
Class LT-Group II Interest, each from
the related Loan Group so that their
respective Lower-Tier Principal Amounts
(computed to at least eight decimal places)
are equal to 0.001% of the
aggregate Stated Principal Balance of the
Mortgage Loans in the related Loan
Group and (ii) the remainder of such
Realized Losses to the Class LT-Accrual
Interest.
In addition to issuing the Lower-Tier Regular Interests, the
Lower-Tier REMIC shall issue the Class R-2
Certificates, which shall be the
sole class of residual interests in the
Lower-Tier REMIC. The Class R-2
Certificates will be issued as a single
certificate in definitive form in a
principal amount of $100 and shall have no
interest rate. Amounts received by
the Class R-2 Certificates shall be deemed
paid from the Lower-Tier REMIC. The
Class LT R-2 Interest shall be deemed to
receive amounts received by the Class
R-2 Certificates.
The Upper-Tier REMIC shall issue the following classes of
Upper-Tier
Regular Interests, and each such interest,
other than the Class UT-R Interest,
is hereby designated as a regular interest
in the Upper-Tier REMIC.
<TABLE>
<CAPTION>
Upper-Tier Interest Initial Upper-Tier
Rate and
Principal Amount and
Upper-Tier Class
Corresponding Class Corresponding Class
Corresponding Class
Designation
Pass-Through Rate Certificate Balance
of
Certificates
-------------------------- -------------------
--------------------
--------------------
<S>
<C>
<C>
<C>
Class 1A1
(1)
$
149,186,000
Class 1A1(10)
Class 2A1
(2)
$
254,412,000
Class 2A1(10)
Class 2A2
(3)
$
57,699,000
Class 2A2(10)
Class 2A3
(4)
$ 6,412,000
Class 2A3(10)
Class 2A4
(5)
$
36,079,000
Class 2A4(10)
Class 2A5
(6)
$ 4,010,000
Class 2A5(10)
Class M-1
(7)
$
25,109,000
Class M-1(10)
Class M-2
(7)
$
23,457,000
Class M-2(10)
Class M-3
(7)
$
13,876,000
Class M-3(10)
Class M-4
(7)
$
12,224,000
Class M-4(10)
Class M-5
(7)
$
11,233,000
Class M-5(10)
Class M-6
(7)
$
10,241,000
Class M-6(10)
Class B-1
(7)
$ 9,250,000
Class B-1(10)
Class B-2
(7)
$ 8,259,000
Class B-2(10)
Class B-3
(7)
$ 7,598,000
Class B-3(10)
Class B-4
(8)
$
15,197,000
Class B-4(10)
Class X
(9)
(9)
Class X(9)
</TABLE>
(1) The Class
1A1 Interest will bear interest during each Interest
Accrual Period at a per annum rate equal to (a) on or prior to
the
first possible Optional Termination Date, the least of (i) LIBOR
plus
0.290%, (ii) the Loan Group I Cap and (iii) the WAC Cap or (b)
after
the first possible Optional Termination Date, the least of (i)
LIBOR
plus 0.580%, (ii) the Loan Group I Cap and (iii) the WAC Cap.
4
<PAGE>
(2) The Class
2A1 Interest will bear interest during each Interest
Accrual Period at a per annum rate equal to (a) on or prior to
the
first possible Optional Termination Date, the least of (i) LIBOR
plus
0.130%, (ii) the Loan Group II Cap and (iii) the WAC Cap or (b)
after
the first possible Optional Termination Date, the least of (i)
LIBOR
plus 0.260%, (ii) the Loan Group II Cap and (iii) the WAC Cap.
(3) The Class
2A2 Interest will bear interest during each Interest
Accrual Period at a per annum rate equal to (a) on or prior to
the
first possible Optional Termination Date, the least of (i) LIBOR
plus
0.280%, (ii) the Loan Group II Cap and (iii) the WAC Cap or (b)
after
the first possible Optional Termination Date, the least of (i)
LIBOR
plus 0.560%, (ii) the Loan Group II Cap and (iii) the WAC Cap.
(4) The Class
2A3 Interest will bear interest during each Interest
Accrual Period at a per annum rate equal to (a) on or prior to
the
first possible Optional Termination Date, the least of (i) LIBOR
plus
0.320%, (ii) the Loan Group II Cap and (iii) the WAC Cap or (b)
after
the first possible Optional Termination Date, the least of (i)
LIBOR
plus 0.640%, (ii) the Loan Group II Cap and (iii) the WAC Cap.
(5) The Class
2A4 Interest will bear interest during each Interest
Accrual Period at a per annum rate equal to (a) on or prior to
the
first possible Optional Termination Date, the least of (i) LIBOR
plus
0370%, (ii) the Loan Group II Cap and (iii) the WAC Cap or (b)
after
the first possible Optional Termination Date, the least of (i)
LIBOR
plus 0.740%, (ii) the Loan Group II Cap and (iii) the WAC Cap.
(6) The Class
2A5 Interest will bear interest during each Interest
Accrual
Period at a per annum rate equal to (a) on or prior to the
first possible Optional Termination Date, the least of (i) LIBOR
plus
0.400%, (ii) the Loan Group II Cap and (iii) the WAC Cap or (b)
after
the first possible Optional Termination Date, the least of (i)
LIBOR
plus 0.800%, (ii) the Loan Group II Cap and (iii) the WAC Cap.
(7) The Class
M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6,
Class B-1, Class B-2 and Class B-3 Interests will bear interest
during each Interest Accrual Period at a per annum rate equal to
(a)
on or prior to the first possible Optional Termination Date,
the
lesser of (i) LIBOR plus 0.500%, 0.530%, 0.550%, 0.650%,
0.710%,
0.770%, 1.350%, 1.450% and 1.900%, respectively, and (ii) the WAC
Cap
or (b) after the first possible Optional Termination Date, the
lesser
of (i) LIBOR plus 0.750%, 0.795%, 0.825%, 0.975%, 1.065%,
1.155%,
2.025%, 2.175% and 2.850%, respectively, and (ii) the WAC Cap.
(8) The Class
B-4 Interests will bear interest during each Interest
Accrual Period at a per annum rate equal to (a) on or prior to
the
first possible Optional Termination Date, the lesser of (i)
5.000%
and (ii) the weighted average of the interest rates for each
mortgage
loan (in each case, less the applicable Expense Fee Rate) then
in
effect at the beginning of the related Due Period on the
mortgage
loans or (b) after the first possible Optional Termination Date,
the
lesser of (i) 5.500% and (ii) the weighted average of the
interest
rates for each mortgage loan (in each case, less the applicable
Expense Fee Rate) then in effect at the beginning of the related
Due
Period on the mortgage loans.
(9) The Class
X Interest will have a principal balance to the extent of
any Overcollateralized Amount. The Class X Interest will not
accrue
interest on such balance but will accrue interest on a notional
principal balance. As of any Distribution Date, the Class X
Interest
shall have a notional principal balance equal to the aggregate of
the
principal balances of the Lower-Tier Regular Interests as of
the
first day of the related Interest Accrual Period. With respect to
any
Interest Accrual Period, the Class X Interest shall bear interest
at
a rate equal to the excess, if any, of the WAC Cap over the
product
of (i) 2
and (ii) the weighted average Lower-Tier Interest Rate of
the Lower-Tier Regular Interests, where the Lower-Tier Interest
Rates
on the Class LT-Accrual, Class LT-Group I and Class LT-Group II
Interests are subject to a cap equal to zero and each
LT-Accretion
Directed Class is subject to a cap equal to the Pass-Through Rate
on
its Corresponding Class. With respect to any Distribution Date,
interest that so accrues on the notional principal balance of
the
Class X Interest shall be deferred in an amount equal to any
increase
in the Overcollateralized Amount on such Distribution Date.
Such
deferred interest shall not itself bear interest. The Class X
Certificates will represent beneficial ownership of the Class X
Interest, the Interest Rate Corridor Agreement and amounts in
the
Excess Reserve Fund Account, subject to the obligation to make
payments from the Excess Reserve Fund Account in respect of
Basis
Risk Carry Forward Amounts. For federal income tax purposes,
the
Trustee will treat the Class X Certificateholder's obligation to
make
payments from the Excess Reserve Fund Account as payments made
pursuant to an interest rate cap contract written by the Class
X
Certificateholders in favor of each Class of Principal
Certificates.
Such rights of the Class X Certificateholders and Principal
5
<PAGE>
Certificateholders shall be treated as held in a portion of the
Trust
Fund that is treated as a grantor trust under subpart E, Part I
of
subchapter J of the Code.
(10) Each of these
Certificates will represent not only the ownership of
the Corresponding Class of Upper-Tier Regular Interest but also
the
right to receive payments from the Excess Reserve Fund Account
in
respect of any Basis Risk Carry Forward Amounts. For federal
income
tax purposes, the Trustee will treat a Principal
Certificateholder's
right to receive payments from the Excess Reserve Fund Account
as
payments made pursuant to an interest rate cap contract written
by
the Class X Certificateholders.
In addition to issuing the Upper-Tier Regular Interests, the
Upper-Tier REMIC shall issue the Class R-1
Certificates, which shall be the
sole class of residual interests in the
Upper-Tier REMIC. The Class R-1
Certificates will be issued as a single
certificate in definitive form in a
principal amount of $100 and shall have no
interest rate. Amounts received by
the Class R-1 Certificates shall be deemed
paid from the Upper-Tier REMIC.
The foregoing REMIC structure is intended to cause all of the
cash
from the Mortgage Loans to flow through to
the Upper-Tier REMIC as cash flow
on a REMIC regular interest, without
creating any shortfall--actual or
potential (other than for credit losses) to
any REMIC regular interest. It is
not intended that the Class R-1 or Class
R-2 Certificates be entitled to any
cash flow pursuant to this Agreement except
as provided in Section
4.02(a)(ii)(A)(a) hereunder.
For any purpose for which the Pass-Through Rates are calculated,
the
interest rate on the Mortgage Loans shall
be appropriately adjusted to account
for the difference between the monthly day
count convention of the Mortgage
Loans and the monthly day count convention
of the regular interests issued by
each of the REMICs. For purposes of
calculating the Pass-Through Rates for
each of the interests issued by the
Lower-Tier REMIC such rates shall be
adjusted to equal a monthly day count
convention based on a 30 day month for
each Due Period and a 360-day year so that
the Mortgage Loans and all regular
interests will be using the same monthly
day count convention.
The minimum denomination for each Class of Principal
Certificates
will be $25,000 initial Certificate
Balance, with integral multiples of $1 in
excess thereof except that one Certificate
in each Class may be issued in a
different amount. The minimum denomination
for (a) the Class R-1 and Class R-2
Certificates will each be $100 and each
will be a 100% Percentage Interest in
such Class and (b) the Class P, Class X and
Class C Certificates will be a 1%
Percentage Interest in each such Class.
Set forth below are designations of Classes of Certificates to
the
categories used herein:
<TABLE>
<CAPTION>
<S>
<C>
Book-Entry
Certificates........................... All Classes of
Certificates other than the Physical
Certificates.
Class A
Certificates.............................. The Class 1A1,
Class 2A1, Class 2A2, Class 2A3, Class 2A4 and
Class 2A5 Certificates, collectively.
Class B
Certificates.............................. The Class B-1,
Class B-2, Class B-3 and Class B-4 Certificates,
collectively.
6
<PAGE>
Class M
Certificates.............................. The Class M-1,
Class M-2, Class M-3, Class M-4, Class M-5 and
Class M-6, collectively.
ERISA Restricted
Certificates..................... The Class R,
Class P and Class X Certificates; any Certificate
with a rating below the lowest applicable permitted rating
under the Underwriters' Exemption.
Fixed Rate
Certificates........................... The Class B-4
Certificates.
LIBOR
Certificates................................ The Offered
Certificates (other than the Residual
Certificates).
Offered
Certificates.............................. The Class 1A1,
Class 2A1, Class 2A2, Class 2A3, Class 2A4,
Class 2A5, Class M-1, Class M-2, Class M-3, Class M-4, Class
M-5, Class M-6, Class R-1 and Class R-2 Certificates,
collectively.
Physical
Certificates............................. The Class X,
Class P, Class C, Class R-1 and Class R-2
Certificates.
Principal
Certificates............................ The LIBOR
Certificates and the Fixed Rate Certificates.
Private
Certificates.............................. The Class B-4,
Class X, Class P and Class C Certificates.
Rating
Agencies................................... S&P and
Moody's.
Regular
Certificates.............................. All Classes of
Certificates other than the Residual
Certificates.
Residual
Certificates............................. Class R-1 and
Class R-2 Certificates.
Subordinated
Certificates......................... The Class M and
Class B Certificates.
</TABLE>
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. Whenever used in this Agreement, the
following words and phrases, unless the
context otherwise requires, shall have
the following meanings:
60+ Day Delinquent Mortgage Loan: Each Mortgage Loan with respect
to
which any portion of a Scheduled Payment
is, as of the last day of the prior
Due Period, two months or
7
<PAGE>
more past due (without giving effect to any
grace period), each Mortgage Loan
in foreclosure, each REO Property and each
Mortgage Loan for which the
Mortgagor has filed for bankruptcy.
90+ Day Delinquent Mortgage Loan: Each Mortgage Loan with respect
to
which any portion of a Scheduled Payment
is, as of the last day of the prior
Due Period, three months or more past due
(without giving effect to any grace
period), including each Mortgage Loan in
foreclosure, all REO Property and
each Mortgage Loan for which the Mortgagor
has filed for bankruptcy.
Accepted Origination Practices: With respect to any Mortgage
Loan
those reasonable and customary nonprime
origination practices in the industry
for the same type of mortgage loans as the
Mortgage Loan in the jurisdiction
where the related Mortgaged Property is
located.
Accepted Servicing Practices: With respect to any Mortgage
Loan,
those mortgage servicing practices set
forth in Section 3.01(a) of this
Agreement.
Account: Any of the Collection Account, the Distribution Account,
any
Escrow Account or the Excess Reserve Fund
Account. Each Account shall be an
Eligible Account.
Accrued Certificate Interest Distribution Amount: With respect to
any
Distribution Date for each Class of
Principal Certificates, the amount of
interest accrued during the related
Interest Accrual Period at the applicable
Pass-Through Rate on the related Class
Certificate Balance immediately prior
to such Distribution Date, as reduced by
such Class's share of Net Prepayment
Interest Shortfalls and Relief Act Interest
Shortfalls for such Distribution
Date allocated to such Class pursuant to
Section 4.02.
Adjusted Net Mortgage Interest Rate: As to each Mortgage Loan and
at
any time, the per annum rate equal to the
Mortgage Interest Rate less the
Expense Fee Rate.
Adjustment Date: As to any Mortgage Loan, the first Due Date on
which
the related Mortgage Interest Rate adjusts
as set forth in the related
Mortgage Note and each Due Date thereafter
on which the Mortgage Interest Rate
adjusts as set forth in the related
Mortgage Note.
Advance: Any P&I Advance or Servicing Advance.
Advance Facility: A financing or other facility as described in
Section 10.07.
Advance Reimbursement Amounts: As defined in Section 10.07.
Advancing Person: The Person to whom the Servicer's rights under
this
Agreement to be reimbursed for any P&I
Advances or Servicing Advances have
been assigned pursuant to Section
10.07.
Affiliate: With respect to any Person, any other Person
controlling,
controlled by or under common control with
such first Person. For the purposes
of this definition, "control" means the
power to direct the management and
policies of such Person, directly or
indirectly,
8
<PAGE>
whether through the ownership of voting
securities, by contract or otherwise;
and the terms "controlling" and
"controlled" have meanings correlative to the
foregoing.
Agreement: This Pooling and Servicing Agreement and all amendments
or
supplements hereto.
Amount Held for Future Distribution: As to the Certificates on
any
Distribution Date, the aggregate amount
held in the Collection Account at the
close of business on the related Remittance
Date on account of (i) Principal
Prepayments, Insurance Proceeds,
Condemnation Proceeds and Liquidation
Proceeds on the Mortgage Loans received
after the end of the related
Prepayment Period and (ii) all Scheduled
Payments on the Mortgage Loans due
after the end of the related Due
Period.
Applied Realized Loss Amount: With respect to any Distribution
Date,
the amount, if any, by which the aggregate
Class Certificate Balance of the
Principal Certificates after distributions
of principal on such Distribution
Date exceeds the aggregate Stated Principal
Balance of the Mortgage Loans for
such Distribution Date.
Appraised Value: With respect to any Mortgage Loan, the value of
the
related Mortgaged Property based upon
either the appraisal made or Insured
AVM, if any, for the originator at the time
of origination of the Mortgage
Loan or the sales price of the Mortgaged
Property at such time of origination,
whichever is less; provided, however, that
in the case of a refinanced
Mortgage Loan, such value is based solely
upon the appraisal made or the
Insured AVM supplied, if any, at the time
of origination of such refinanced
Mortgage Loan.
Assignment of Mortgage: An assignment of the Mortgage, notice
of
transfer or equivalent instrument in
recordable form (other than the
assignee's name and recording information
not yet returned from the recording
office), reflecting the sale of the
Mortgage to the Trustee.
Available Funds: With respect to any Distribution Date and the
Mortgage Loans to the extent received by
the Trustee (x) the sum of (without
duplication) (i) all scheduled installments
of interest (net of the related
Expense Fees) and principal due on the Due
Date on such Mortgage Loans in the
related Due Period and received on or prior
to the related Determination Date,
together with any P&I Advances in
respect thereof; (ii) all Condemnation
Proceeds, Insurance Proceeds and
Liquidation Proceeds received during the
related Prepayment Period (in each case,
net of unreimbursed expenses incurred
in connection with a liquidation or
foreclosure and unreimbursed Advances, if
any); (iii) all partial or full prepayments
on the Mortgage Loans (excluding
Prepayment Premiums) received during the
related Prepayment Period together
with all Compensating Interest paid by the
Servicer in connection therewith;
(iv) all amounts received with respect to
such Distribution Date as the
purchase price in respect of a Mortgage
Loan repurchased by the Responsible
Party or the Depositor as of such
Distribution Date; and (v) the proceeds
received with respect to the termination of
the Trust Fund pursuant to clause
(a) of Section 9.01, reduced by (y) amounts
in reimbursement for P&I Advances
and Servicing Advances previously made with
respect to the Mortgage Loans and
other amounts as to which the Servicer, the
Depositor or the Trustee (or co
trustee) are entitled to be paid or
reimbursed pursuant to this Agreement.
9
<PAGE>
Balloon Loan: Any Mortgage Loan that provided on the date of
origination for an amortization schedule
extending beyond its stated maturity
date.
Basic Principal Distribution Amount: With respect to any
Distribution
Date, the excess of (i) the Principal
Remittance Amount for such Distribution
Date over (ii) the Excess
Overcollateralized Amount, if any, for such
Distribution Date.
Basis Risk Carry Forward Amount: With respect to each Class of
Principal Certificates, as of any
Distribution Date, the sum of (A) if on such
Distribution Date the Pass-Through Rate for
any Class of Principal
Certificates is based upon a Loan Group Cap
or the WAC Cap, as applicable, the
excess of (i) the amount of interest such
Class of Principal Certificates
would otherwise be entitled to receive on
such Distribution Date had such rate
been calculated as the sum of LIBOR and the
applicable Pass-Through Margin, in
the case of the LIBOR Certificates, or at
the applicable Fixed Rate, in the
case of the Fixed Rate Certificates for
such Class of Certificates for such
Distribution Date, over (ii) the amount of
interest payable on such Class of
Certificates with respect to the Class 1A1
Certificates, the lesser of the
Loan Group I Cap or the WAC Cap, and with
respect to the Class A-2
Certificates, the lesser of the Loan Group
II Cap or the WAC Cap, and (B) the
Basis Risk Carry Forward Amount for such
Class of Certificates for all
previous Distribution Dates not previously
paid, together with interest
thereon at a rate equal to the sum of LIBOR
and the applicable Pass-Through
Margin, in the case of the LIBOR
Certificates, or at the applicable Fixed
Rate, in the case of the Fixed Rate
Certificates for such Class of
Certificates for such Distribution
Date.
Basis Risk Payment: For any Distribution Date, an amount equal to
the
lesser of (i) the aggregate of the Basis
Risk Carry Forward Amounts for such
Distribution Date and (ii) the Class X
Distributable Amount (prior to any
reduction for Basis Risk Payments).
Best's: Best's Key Rating Guide, as the same shall be amended
from
time to time.
Book-Entry Certificates: As specified in the Preliminary
Statement.
BPO: A broker's price opinion.
Business Day: Any day other than (i) Saturday or Sunday, or (ii)
a
day on which banking and savings and loan
institutions, in (a) the States of
New York or California, (b) the State in
which the Servicer's servicing
operations are located, or (c) the State in
which the Trustee's operations are
located, are authorized or obligated by law
or executive order to be closed.
Certificate: Any one of the Certificates executed by the Trustee
in
substantially the forms attached hereto as
exhibits.
Certificate Balance: With respect to any Class of Principal
Certificates, at any date, the maximum
dollar amount of principal to which the
Holder thereof is then entitled hereunder,
such amount being equal to the
Denomination thereof minus all
distributions of principal previously made with
respect thereto and in the case of any
Subordinated Certificates, reduced by
any Applied Realized Loss Amounts
applicable to such Class of Subordinated
10
<PAGE>
Certificates; provided, however, that
immediately following the Distribution
Date on which a Subsequent Recovery is
distributed, the Class Certificate
Balances of any Class or Classes of
Certificates that have been previously
reduced by Applied Realized Loss Amounts
will be increased, in order of
seniority, by the amount of the Subsequent
Recovery distributed on such
Distribution Date (up to the amount of
Applied Realized Loss Amounts allocated
to such Class or Classes). The Class P,
Class X and Class C Certificates have
no Certificate Balance.
Certificate Owner: With respect to a Book-Entry Certificate,
the
Person who is the beneficial owner of such
Book-Entry Certificate.
Certificate Register: The register maintained pursuant to
Section
5.02.
Certificateholder or Holder: The Person in whose name a
Certificate
is registered in the Certificate Register,
except that, solely for the purpose
of giving any consent pursuant to this
Agreement, any Certificate registered
in the name of the Depositor or any
affiliate of the Depositor shall be deemed
not to be Outstanding and the Percentage
Interest evidenced thereby shall not
be taken into account in determining
whether the requisite amount of
Percentage Interests necessary to effect
such consent has been obtained;
provided, however, that if any such Person
(including the Depositor) owns 100%
of the Percentage Interests evidenced by a
Class of Certificates, such
Certificates shall be deemed to be
Outstanding for purposes of any provision
hereof that requires the consent of the
Holders of Certificates of a
particular Class as a condition to the
taking of any action hereunder. The
Trustee is entitled to rely conclusively on
a certification of the Depositor
or any affiliate of the Depositor in
determining which Certificates are
registered in the name of an affiliate of
the Depositor.
Certification: As defined in Section 8.12(b).
Class: All Certificates bearing the same class designation as
set
forth in the Preliminary Statement.
Class 1A1 Certificates: All Certificates bearing the class
designation of "Class 1A1."
Class 2A1 Certificates: All Certificates bearing the class
designation of "Class 2A1."
Class 2A2 Certificates: All Certificates bearing the class
designation of "Class 2A2."
Class 2A3 Certificates: All Certificates bearing the class
designation of "Class 2A3."
Class 2A4 Certificates: All Certificates bearing the class
designation of "Class 2A4."
Class 2A5
Certificates: All Certificates bearing the class
designation of "Class 2A5."
11
<PAGE>
Class A Certificate Group: Either the Class 1A1 Certificates or
the
Class A-2 Certificates, as applicable.
Class A Certificates: The Class 1A1 Certificates and the Class
A-2
Certificates.
Class A-2 Certificates: The Class 2A1, Class 2A2, Class 2A3,
Class
2A4 and Class 2A5 Certificates,
collectively.
Class A Principal Allocation Percentage: For any Distribution
Date,
the percentage equivalent of a fraction,
determined as follows: (A) with
respect to the Class 1A1 Certificates, a
fraction, the numerator of which is
the portion of the Principal Remittance
Amount for such Distribution Date that
is attributable to the principal received
or advanced on the Group I Mortgage
Loans and the denominator of which is the
Principal Remittance Amount for such
Distribution Date; and (B) with respect to
the Class A-2 Certificates, a
fraction, the numerator of which is the
portion of the Principal Remittance
Amount for such Distribution Date that is
attributable to the principal
received or advanced on the Group II
Mortgage Loans and the denominator of
which is the Principal Remittance Amount
for such Distribution Date.
Class A Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
aggregate Class Certificate Balance
of the Class A Certificates immediately
prior to such Distribution Date over
(ii) the lesser of (A) 53.70% (rounded to
two decimal places) of the aggregate
Stated Principal Balance of the Mortgage
Loans for such Distribution Date and
(B) the excess, if any, of the aggregate
Stated Principal Balance of the
Mortgage Loans for such Distribution Date
over the Overcollateralization
Floor.
Class B Certificates: The B-1, Class B-2, Class B-3 and Class
B-4
Certificates.
Class B-1 Certificates: All Certificates bearing the class
designation of "Class B-1."
Class B-1 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
sum of (A) the aggregate Class
Certificate Balances of the Class A
Certificates (after taking into account
the distribution of the Class A Principal
Distribution Amount on such
Distribution Date), (B) the Class
Certificate Balance of the Class M-1
Certificates (after taking into account the
distribution of the Class M-1
Principal Distribution Amount on such
Distribution Date), (C) the Class
Certificate Balance of the Class M-2
Certificates (after taking into account
the distribution of the Class M-2 Principal
Distribution Amount on such
Distribution Date), (D) the Class
Certificate Balance of the Class M-3
Certificates (after taking into account the
distribution of the Class M-3
Principal Distribution Amount on such
Distribution Date), (E) the Class
Certificate Balance of the Class M-4
Certificates (after taking into account
the distribution of the Class M-4 Principal
Distribution Amount on such
Distribution Date), (F) the Class
Certificate Balance of the Class M-5
Certificates (after taking into account the
distribution of the Class M-5
Principal Distribution Amount on such
Distribution Date), (G) the Class
Certificate Balance of the Class M-6
Certificates (after taking into account
the distribution of the Class M-6 Principal
Distribution Amount on such
Distribution Date) and (H) the Class
Certificate Balance of the Class B-1
Certificates immediately prior to such
Distribution Date over (ii) the lesser
of (A) 85.60%
12
<PAGE>
(rounded to two decimal places) of the
aggregate Stated Principal Balance of
the Mortgage Loans for such Distribution
Date and (B) the excess, if any, of
the aggregate Stated Principal Balance of
the Mortgage Loans for such
Distribution Date over the
Overcollateralization Floor.
Class B-2 Certificates: All Certificates bearing the class
designation of "Class B-2."
Class B-2 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
sum of (A) the aggregate Class
Certificate Balances of the Class A
Certificates (after taking into account
the distribution of the Class A Principal
Distribution Amount on such
Distribution Date), (B) the Class
Certificate Balance of the Class M-1
Certificates (after taking into account the
distribution of the Class M-1
Principal Distribution Amount on such
Distribution Date), (C) the Class
Certificate Balance of the Class M-2
Certificates (after taking into account
the distribution of the Class M-2 Principal
Distribution Amount on such
Distribution Date), (D) the Class
Certificate Balance of the Class M-3
Certificates (after taking into account the
distribution of the Class M-3
Principal Distribution Amount on such
Distribution Date), (E) the Class
Certificate Balance of the Class M-4
Certificates (after taking into account
the distribution of the Class M-4 Principal
Distribution Amount on such
Distribution Date), (F) the Class
Certificate Balance of the Class M-5
Certificates (after taking into account the
distribution of the Class M-5
Principal Distribution Amount on such
Distribution Date), (G) the Class
Certificate Balance of the Class M-6
Certificates (after taking into account
the distribution of the Class M-6 Principal
Distribution Amount on such
Distribution Date), (H) the Class
Certificate Balance of the Class B-1
Certificates (after taking into account the
distribution of the Class B-1
Principal Distribution Amount on such
Distribution Date) and (I) the Class
Certificate Balance of the Class B-2
Certificates immediately prior to such
Distribution Date over (ii) the lesser of
(A) 88.10% (rounded to two decimal
places) of the aggregate Stated Principal
Balance of the Mortgage Loans for
such Distribution Date and (B) the excess,
if any, of the aggregate Stated
Principal Balance of the Mortgage Loans for
such Distribution Date over the
Overcollateralization Floor.
Class B-3 Certificates: All Certificates bearing the class
designation of "Class B-3."
Class B-3 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
sum of (A) the aggregate Class
Certificate Balances of the Class A
Certificates (after taking into account
the distribution of the Class A Principal
Distribution Amount on such
Distribution Date), (B) the Class
Certificate Balance of the Class M-1
Certificates (after taking into account the
distribution of the Class M-1
Principal Distribution Amount on such
Distribution Date), (C) the Class
Certificate Balance of the Class M-2
Certificates (after taking into account
the distribution of the Class M-2 Principal
Distribution Amount on such
Distribution Date), (D) the Class
Certificate Balance of the Class M-3
Certificates (after taking into account the
distribution of the Class M-3
Principal Distribution Amount on such
Distribution Date), (E) the Class
Certificate Balance of the Class M-4
Certificates (after taking into account
the distribution of the Class M-4 Principal
Distribution Amount on such
Distribution Date), (F) the Class
Certificate Balance of the Class M-5
Certificates (after taking into account the
distribution of the Class M-5
Principal Distribution Amount on such
Distribution Date), (G) the Class
Certificate Balance of the Class M-6
13
<PAGE>
Certificates (after taking into account the
distribution of the Class M-6
Principal Distribution Amount on such
Distribution Date), (H) the Class
Certificate Balance of the Class B-1
Certificates (after taking into account
the distribution of the Class B-1 Principal
Distribution Amount on such
Distribution Date), (I) the Class
Certificate Balance of the Class B-2
Certificates (after taking into account the
distribution of the Class B-2
Principal Distribution Amount on such
Distribution Date) and (J) the Class
Certificate Balance of the Class B-3
Certificates immediately prior to such
Distribution Date over (ii) the lesser of
(A) 90.40% (rounded to two decimal
places) of the aggregate Stated Principal
Balance of the Mortgage Loans for
such Distribution Date and (B) the excess,
if any, of the aggregate Stated
Principal Balance of the Mortgage Loans for
such Distribution Date over the
Overcollateralization Floor.
Class B-4 Certificates: All Certificates bearing the class
designation of "Class B-4."
Class B-4 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
sum of (A) the aggregate Class
Certificate Balances of the Class A
Certificates (after taking into account
the distribution of the Class A Principal
Distribution Amount on such
Distribution Date), (B) the Class
Certificate Balance of the Class M-1
Certificates (after taking into account the
distribution of the Class M-1
Principal Distribution Amount on such
Distribution Date), (C) the Class
Certificate Balance of the Class M-2
Certificates (after taking into account
the distribution of the Class M-2 Principal
Distribution Amount on such
Distribution Date), (D) the Class
Certificate Balance of the Class M-3
Certificates (after taking into account the
distribution of the Class M-3
Principal Distribution Amount on such
Distribution Date), (E) the Class
Certificate Balance of the Class M-4
Certificates (after taking into account
the distribution of the Class M-4 Principal
Distribution Amount on such
Distribution Date), (F) the Class
Certificate Balance of the Class M-5
Certificates (after taking into account the
distribution of the Class M-5
Principal Distribution Amount on such
Distribution Date), (G) the Class
Certificate Balance of the Class M-6
Certificates (after taking into account
the distribution of the Class M-6 Principal
Distribution Amount on such
Distribution Date), (H) the Class
Certificate Balance of the Class B-1
Certificates (after taking into account the
distribution of the Class B-1
Principal Distribution Amount on such
Distribution Date), (I) the Class
Certificate Balance of the Class B-2
Certificates (after taking into account
the distribution of the Class B-2 Principal
Distribution Amount on such
Distribution Date), (J) the Class
Certificate Balance of the Class B-3
Certificates (after taking into account the
distribution of the Class B-3
Principal Distribution Amount on such
Distribution Date) and (K) the Class
Certificate Balance of the Class B-4
Certificates immediately prior to such
Distribution Date over (ii) the lesser of
(A) 95.00% (rounded to two decimal
places) of the aggregate Stated Principal
Balance of the Mortgage Loans for
such Distribution Date and (B) the excess,
if any, of the aggregate Stated
Principal Balance of the Mortgage Loans for
such Distribution Date over the
Overcollateralization Floor.
Class C Certificates: All Certificates bearing the class
designation
of "Class C."
Class Certificate Balance: With respect to any Class and as to
any
date of determination, the aggregate of the
Certificate Balances of all
Certificates of such Class as of such
date.
14
<PAGE>
Class M Certificates: The Class M-1, Class M-2, Class M-3, Class
M-4,
Class M-5 and Class M-6 Certificates.
Class M-1 Certificates: All Certificates bearing the class
designation of "Class M-1."
Class M-1 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
sum of (A) the aggregate Class
Certificate Balances of the Class A
Certificates (after taking into account
the distribution of the Class A Principal
Distribution Amount on such
Distribution Date), and (B) the Class
Certificate Balance of the Class M-1
Certificates immediately prior to such
Distribution Date over (ii) the lesser
of (A) 61.30% (rounded to two decimal
places) of the aggregate Stated
Principal Balance of the Mortgage Loans for
such Distribution Date and (B) the
excess, if any, of the aggregate Stated
Principal Balance of the Mortgage
Loans for such Distribution Date over the
Overcollateralization Floor.
Class M-2 Certificates: All Certificates bearing the class
designation of "Class M-2."
Class M-2 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
sum of (A) the aggregate Class
Certificate Balances of the Class A
Certificates (after taking into account
the distribution of the Class A Principal
Distribution Amount on such
Distribution Date), (B) the Class
Certificate Balance of the Class M-1
Certificates (after taking into account the
distribution of the Class M-1
Principal Distribution Amount on such
Distribution Date) and (C) the Class
Certificate Balance of the Class M-2
Certificates immediately prior to such
Distribution Date over (ii) the lesser of
(A) 68.40% (rounded to two decimal
places) of the aggregate Stated Principal
Balance of the Mortgage Loans for
such Distribution Date and (B) the excess,
if any, of the aggregate Stated
Principal Balance of the Mortgage Loans for
such Distribution Date over the
Overcollateralization Floor.
Class M-3 Certificates: All Certificates bearing the class
designation of "Class M-3."
Class M-3 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
sum of (A) the aggregate Class
Certificate Balances of the Class A
Certificates (after taking into account
the distribution of the Class A Principal
Distribution Amount on such
Distribution Date), (B) the Class
Certificate Balance of the Class M-1
Certificates (after taking into account the
distribution of the Class M-1
Principal Distribution Amount on such
Distribution Date), (C) the Class
Certificate Balance of the Class M-2
Certificates (after taking into account
the distribution of the Class M-2 Principal
Distribution Amount on such
Distribution Date) and (D) the Class
Certificate Balance of the Class M-3
Certificates immediately prior to such
Distribution Date over (ii) the lesser
of (A) 72.60% (rounded to two decimal
places) of the aggregate Stated
Principal Balance of the Mortgage Loans for
such Distribution Date and (B) the
excess, if any, of the aggregate Stated
Principal Balance of the Mortgage
Loans for such Distribution Date over the
Overcollateralization Floor.
Class M-4 Certificates: All Certificates bearing the class
designation of "Class M-4."
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<PAGE>
Class M-4 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
sum of (A) the aggregate Class
Certificate Balances of the Class A
Certificates (after taking into account
the distribution of the Class A Principal
Distribution Amount on such
Distribution Date), (B) the Class
Certificate Balance of the Class M-1
Certificates (after taking into account the
distribution of the Class M-1
Principal Distribution Amount on such
Distribution Date), (C) the Class
Certificate Balance of the Class M-2
Certificates (after taking into account
the distribution of the Class M-2 Principal
Distribution Amount on such
Distribution Date), (D) the Class
Certificate Balance of the Class M-3
Certificates (after taking into account the
distribution of the Class M-3
Principal Distribution Amount on such
Distribution Date) and (E) the Class
Certificate Balance of the Class M-4
Certificates immediately prior to such
Distribution Date over (ii) the lesser of
(A) 76.30% (rounded to two decimal
places) of the aggregate Stated Principal
Balance of the Mortgage Loans for
such Distribution Date and (B) the excess,
if any, of the aggregate Stated
Principal Balance of the Mortgage Loans for
such Distribution Date over the
Overcollateralization Floor.
Class M-5 Certificates: All Certificates bearing the class
designation of "Class M-5."
Class M-5 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
sum of (A) the aggregate Class
Certificate Balances of the Class A
Certificates (after taking into account
the distribution of the Class A Principal
Distribution Amount on such
Distribution Date), (B) the Class
Certificate Balance of the Class M-1
Certificates (after taking into account the
distribution of the Class M-1
Principal Distribution Amount on such
Distribution Date), (C) the Class
Certificate Balance of the Class M-2
Certificates (after taking into account
the distribution of the Class M-2 Principal
Distribution Amount on such
Distribution Date), (D) the Class
Certificate Balance of the Class M-3
Certificates (after taking into account the
distribution of the Class M-3
Principal Distribution Amount on such
Distribution Date), (E) the Class
Certificate Balance of the Class M-4
Certificates (after taking into account
the distribution of the Class M-4 Principal
Distribution Amount on such
Distribution Date) and (F) the Class
Certificate Balance of the Class M-5
Certificates immediately prior to such
Distribution Date over (ii) the lesser
of (A) 79.70% (rounded to two decimal
places) of the aggregate Stated
Principal Balance of the Mortgage Loans for
such Distribution Date and (B) the
excess, if any, of the aggregate Stated
Principal Balance of the Mortgage
Loans for such Distribution Date over the
Overcollateralization Floor.
Class M-6 Certificates: All Certificates bearing the class
designation of "Class M-6."
Class M-6 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the
sum of (A) the aggregate Class
Certificate Balances of the Class A
Certificates (after taking into account
the distribution of the Class A Principal
Distribution Amount on such
Distribution Date), (B) the Class
Certificate Balance of the Class M-1
Certificates (after taking into account the
distribution of the Class M-1
Principal Distribution Amount on such
Distribution Date), (C) the Class
Certificate Balance of the Class M-2
Certificates (after taking into account
the distribution of the Class M-2 Principal
Distribution Amount on such
Distribution Date), (D) the Class
Certificate Balance of the Class M-3
Certificates (after taking into account the
distribution of the Class M-3
Principal Distribution
16
<PAGE>
Amount on such Distribution Date), (E) the
Class Certificate Balance of the
Class M-4 Certificates (after taking into
account the distribution of the
Class M-4 Principal Distribution Amount on
such Distribution Date), (F) the
Class Certificate Balance of the Class M-5
Certificates (after taking into
account the distribution of the Class M-5
Principal Distribution Amount on
such Distribution Date) and (G) the Class
Certificate Balance of the Class M-6
Certificates immediately prior to such
Distribution Date over (ii) the lesser
of (A) 82.80% (rounded to two decimal
places) of the aggregate Stated
Principal Balance of the Mortgage Loans for
such Distribution Date and (B) the
excess, if any, of the aggregate Stated
Principal Balance of the Mortgage
Loans for such Distribution Date over the
Overcollateralization Floor.
Class P Certificates: All Certificates bearing the class
designation
of "Class P."
Class R Certificates: The Class R-1 and Class R-2 Certificates.
Class R-1 Certificates: All Certificates bearing the class
designation of "Class R-1."
Class R-2 Certificates: All Certificates bearing the class
designation of "Class R-2."
Class X Certificates: All Certificates bearing the class
designation
of "Class X."
Class X Distributable Amount: On any Distribution Date, (i) as
a
distribution in respect of interest, the
amount of interest that has accrued
on the Class X Interest and not applied as
an Extra Principal Distribution
Amount on such Distribution Date, plus any
such accrued interest remaining
undistributed from prior Distribution
Dates, plus, without duplication, (ii)
as a distribution in respect of principal,
any portion of the principal
balance of the Class X Interest which is
distributable as an
Overcollateralization Reduction Amount,
minus (iii) any amounts paid as a
Basis Risk Payment.
Class X Interest: The Upper-Tier Regular Interest represented by
the
Class X Certificates as specified and
described in the Preliminary Statement
and the related footnote thereto.
Closing Date: August 26, 2005.
Code: The Internal Revenue Code of 1986, including any successor
or
amendatory provisions.
Collection Account: As defined in Section 3.10(a).
Compensating Interest: For any Distribution Date, the lesser of
(a)
the Prepayment Interest Shortfall, if any,
for such Distribution Date, with
respect to voluntary Principal Prepayments
in full or in part by the Mortgagor
(excluding any payments made upon
liquidation of the Mortgage Loan), and (b)
the Servicing Fee payable to the Servicer
for such Distribution Date.
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<PAGE>
Condemnation Proceeds: All awards, compensation and/or settlements
in
respect of a Mortgaged Property, whether
permanent or temporary, partial or
entire, by exercise of the power of eminent
domain or condemnation.
Corporate Trust Office: The designated office of the Trustee in
the
State of California at which at any
particular time its corporate trust
business with respect to this Agreement is
administered, which office at the
date of the execution of this Agreement is
located at 1761 East St. Andrew
Place, Santa Ana, California 92705-4934,
Attn: Trust Administration - GS0510,
facsimile no. (714) 247-6478, and which is
the address to which notices to and
correspondence with the Trustee should be
directed.
Corresponding Class: The Class of interests in one Trust REMIC
created under this Agreement that
corresponds to the Class of interests in the
other Trust REMIC or to a Class of
Certificates in the manner set out below:
Corresponding
Lower-Tier
Upper-Tier
Class of
Regular Interest
Regular Interest
Certificates
------------------
------------------
----------------
Class LT-1A1
Class 1A1
Class 1A1
Class LT-2A1
Class 2A1
Class 2A1
Class LT-2A2
Class 2A2
Class 2A2
Class LT-2A3
Class 2A3
Class 2A3
Class LT-2A4
Class 2A4
Class 2A4
Class LT-2A5
Class 2A5
Class 2A5
Class LT-M-1
Class M-1
Class M-1
Class LT-M-2
Class M-2
Class M-2
Class LT-M-3
Class M-3
Class M-3
Class LT-M-4
Class M-4
Class M-4
Class LT-M-5
Class M-5
Class M-5
Class LT-M-6
Class M-6
Class M-6
Class LT-B-1
Class B-1
Class B-1
Class LT-B-2
Class B-2
Class B-2
Class LT-B-3
Class B-3
Class B-3
Class LT-B-4
Class B-4
Class B-4
N/A
Class X
Class X
Corridor Provider: Goldman Sachs Capital Markets, L.P., a
Delaware
limited partnership, and its successors in
interest.
Countrywide Servicing: Countrywide Home Loans Servicing LP, a
Texas
limited partnership, and its successors in
interest.
Covered Loan: A Mortgage Loan categorized as Covered pursuant
to
Appendix E of S&P Glossary.
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<PAGE>
Cumulative Loss Percentage: With respect to any Distribution
Date,
the percentage equivalent of a fraction,
the numerator of which is the
aggregate amount of Realized Losses
incurred from the Cut-off Date to the last
day of the calendar month preceding the
month in which such Distribution Date
occurs and the denominator of which is the
Cut-off Date Pool Principal Balance
of the Mortgage Loans.
Custodial File: With respect to each Mortgage Loan, any Mortgage
Loan
Document which is delivered to the Trustee
or which at any time comes into the
possession of the Trustee.
Cut-off Date: August 1, 2005.
Cut-off Date Pool Principal Balance: The aggregate Stated
Principal
Balances of all Mortgage Loans as of the
Cut-off Date.
Cut-off Date Principal Balance: As to any Mortgage Loan, the
Stated
Principal Balance thereof as of the close
of business on the Cut-off Date
(after giving effect to payments of
principal due on that date, whether or not
received).
Data File: As defined in Section 4.03(e).
Data File Delivery Date: As defined in Section 4.03(e).
Data Tape Information: The information previously provided as of
the
Cut-off Date to the Depositor setting forth
the following information with
respect to each Mortgage Loan: (1) the
Responsible Party's Mortgage Loan
identifying number; (2) the Mortgagor's
name; (3) the street address of the
Mortgaged Property including the city,
state and zip code; (4) a code
indicating whether the Mortgaged Property
is owner-occupied, a second home or
investment property (as indicated by the
Mortgagor at the time of origination
of the Mortgage Loan); (5) the number and
type of residential units
constituting the Mortgaged Property (i.e.,
a single family residence, a 2-4
family residence, a unit in a condominium
project or a unit in a planned unit
development, manufactured housing); (6) the
Mortgage Loan origination date;
(7) the original months to maturity or the
remaining months to maturity from
the related Cut-off Date, in any case based
on the original amortization
schedule and, if different, the maturity
expressed in the same manner but
based on the actual amortization schedule;
(8) the Loan-to-Value Ratio at
origination; (9) with respect to First Lien
Loans, the LTV; (10) the Mortgage
Interest Rate as of the related Cut-off
Date; (11) the date on which the
Monthly Payment was due on the Mortgage
Loan and, if such date is not
consistent with the Due Date currently in
effect, such Due Date; (12) the
stated maturity date; (13) the amount of
the Monthly Payment as of the related
Cut-off Date; (14) the last payment date as
of which a payment was actually
applied to the outstanding principal
balance (i.e. the paid through date);
(15) the original principal amount of the
Mortgage Loan; (16) the principal
balance of the Mortgage Loan as of the
close of business on the related
Cut-off Date, after deduction of payments
of principal due and collected on or
before the Cut-off Date; (17) the Interest
Rate Adjustment Date; (18) the
Gross Margin; (19) the Lifetime Rate Cap
under the terms of the Mortgage Note;
(20) a code indicating the type of Index;
(21) the Mortgage Interest Rate as
of origination; (22) the type of Mortgage
Loan (i.e., fixed-rate,
adjustable-rate); (23) the lien status of
the Mortgage Loan; (24) a code
indicating the
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<PAGE>
purpose of the loan (i.e., purchase,
refinance, cash-out refinance); (25) a
code indicating the documentation style
(i.e., full, limited, or stated
income); (26) the credit risk
classification (as described in the Underwriting
Guidelines); (27) the applicable Cut-off
Date; (28) the applicable Closing
Date; (29) a code indicating whether the
Mortgage Loan is a High Cost Loan or
Home Loan as such terms are defined in the
then current S&P Glossary; (30) the
FICO score; (31) with respect to the
related Mortgagor, the debt-to-income
ratio; (32) the Appraised Value of the
Mortgaged Property; (33) the sale price
of the Mortgaged Property if the Mortgage
Loan was originated in connection
with the purchase of the Mortgaged
Property; (34) the Periodic Rate Cap under
the terms of the Mortgage Note; (35) the
Periodic Rate Floor under the terms
of the Mortgage Note; (36) whether such
Mortgage Loan provides for a
prepayment charge; (37) the prepayment
charge period of such Mortgage Loan, if
applicable; (38) a description of the type
of prepayment charge, if
applicable; (39) a code indicating if the
Mortgage Loan is a Balloon Mortgage
Loan; (40) the initial and periodic
mortgage interest rate adjustment period;
(41) mortgage interest rate adjustment
percentage; (42) a code indicating
whether Mortgage Loan is assumable; (43) a
code indicating whether Mortgage
Loan has been modified; (44) one year
payment history; (45) due date for first
monthly payment; (46) original monthly
payment due; (47) S&P doc type code;
(48) S&P appraisal type code; (49)
escrow holdbacks, if any; and (50) total
points and fees paid by the Mortgagor. With
respect to the Mortgage Loans in
the aggregate, the Mortgage Loan Schedule
shall set forth the following
information, as of the related Cut-off
Date: (1) the number of Mortgage Loans;
(2) the current aggregate outstanding
principal balance of the Mortgage Loans;
(3) the weighted average Mortgage Interest
Rate of the Mortgage Loans; and (4)
the weighted average maturity of the
Mortgage Loans.
Debt Service Reduction: With respect to any Mortgage Loan, a
reduction by a court of competent
jurisdiction in a proceeding under the
United States Bankruptcy Code in the
Scheduled Payment for such Mortgage Loan
which became final and non-appealable,
except for such a reduction resulting
from a Deficient Valuation or any reduction
that results in a permanent
forgiveness of principal.
Deficient Valuation: With respect to any Mortgage Loan, a
valuation
of the related Mortgaged Property by a
court of competent jurisdiction in an
amount less than the then outstanding
principal balance of the Mortgage Loan,
which valuation results from a proceeding
initiated under the United States
Bankruptcy Code.
Definitive Certificates: Any Certificate evidenced by a
Physical
Certificate and any Certificate issued in
lieu of a Book-Entry Certificate
pursuant to Section 5.02(e).
Denomination: With respect to each Certificate, the amount set
forth
on the face thereof as the "Initial
Certificate Balance of this Certificate"
or the Percentage Interest appearing on the
face thereof.
Depositor: GS Mortgage Securities Corp., a Delaware corporation,
and
its successors in interest.
Depository: The initial Depository shall be The Depository
Trust
Company, the nominee of which is CEDE &
Co., as the registered Holder of the
Book-Entry Certificates. The
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<PAGE>
Depository shall at all times be a
"clearing corporation" as defined in
Section 8 102(a)(5) of the Uniform
Commercial Code of the State of New York.
Depository Institution: Any depository institution or trust
company,
including the Trustee, that (a) is
incorporated under the laws of the United
States of America or any State thereof, (b)
is subject to supervision and
examination by federal or state banking
authorities and (c) has outstanding
unsecured commercial paper or other short
term unsecured debt obligations that
are rated P-1 by Moody's, A-1 by S&P
and F1+ by Fitch (in each case, to the
extent they are designated as Rating
Agencies in the Preliminary Statement).
Depository Participant: A broker, dealer, bank or other
financial
institution or other Person for whom from
time to time a Depository effects
book-entry transfers and pledges of
securities deposited with the Depository.
Determination Date: With respect to each Distribution Date, the
18th
day of the calendar month in which such
Distribution Date occurs, or if such
day is not a Business Day, the immediately
preceding Business Day.
Distribution Account: The separate Eligible Account created and
maintained by the Trustee pursuant to
Section 3.27(b) in the name of the
Trustee for the benefit of the
Certificateholders and designated "Deutsche
Bank National Trust Company in trust for
registered holders of GSAA Home
Equity Trust 2005-10 Asset Backed
Certificates, Series 2005-10." Funds in the
Distribution Account shall be held in trust
for the Certificateholders for the
uses and purposes set forth in this
Agreement and may be invested in Permitted
Investments.
Distribution Date: The 25th day of each calendar month after
the
initial issuance of the Certificates, or if
such day is not a Business Day,
the next succeeding Business Day,
commencing in September 2005.
Document Certification and Exception Report: The report attached
to
Exhibit F hereto.
Due Date: The day of the month on which the Scheduled Payment is
due
on a Mortgage Loan, exclusive of any days of
grace.
Due Period: With respect to any Distribution Date, the period
commencing on the second day of the
calendar month preceding the month in
which the Distribution Date occurs and
ending on the first day of the calendar
month in which the Distribution Date
occurs.
Eligible Account: Either (i) an account maintained with a federal
or
state chartered depository institution or
trust company the short-term
unsecured debt obligations of which (or, in
the case of a depository
institution or trust company that is a
subsidiary of a holding company, the
short term unsecured debt obligations of
such holding company) are rated "A-1"
by S&P, "F-1" by Fitch and "P-1" by
Moody's (in each case, to the extent they
are designated as Rating Agencies in the
Preliminary Statement) (and a
comparable rating if another Rating Agency
is specified by the Depositor by
written notice to the Servicer) at the time
any amounts are held on deposit
therein, (ii) a trust account or accounts
maintained with a federal or state
chartered depository institution or trust
company acting in its fiduciary
capacity or (iii) any other
21
<PAGE>
account acceptable to each Rating Agency.
Eligible Accounts may bear interest,
and may include, if otherwise qualified
under this definition, accounts
maintained with the Trustee.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA-Qualifying Underwriting: A best efforts or firm
commitment
underwriting or private placement that
meets the requirements of Prohibited
Transaction Exemption ("PTE") 2002-41, 67
Fed. Reg. 54487 --- (2002) (or any
successor thereto), or any substantially
similar administrative exemption
granted by the U.S. Department of
Labor.
ERISA-Restricted
Certificate: As specified in the Preliminary
Statement.
Escrow Account: The Eligible Account or Accounts established
and
maintained pursuant to Section 3.09(b).
Escrow Payments: As defined in Section 3.09(b) of this
Agreement.
Event of Default: As defined in Section 7.01.
Excess Overcollateralized Amount: With respect to any
Distribution
Date, the excess, if any, of (a) the
Overcollateralized Amount on such
Distribution Date over (b) the Specified
Overcollateralized Amount for such
Distribution Date.
Excess Reserve Fund Account: The separate Eligible Account
created
and maintained by the Trustee pursuant to
Sections 3.27(a) in the name of the
Trustee for the benefit of the Regular
Certificateholders and designated
"Deutsche Bank National Trust Company in
trust for registered holders of GSAA
Home Equity Trust 2005-10, Asset Backed
Certificates, Series 2005-10." Funds
in the Excess Reserve Fund Account shall be
held in trust for the Regular
Certificateholders for the uses and
purposes set forth in this Agreement.
Amounts on deposit in the Excess Reserve
Fund Account shall not be invested.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Expense Fee Rate: As to each Mortgage Loan, a per annum rate equal
to
the sum of the Servicing Fee Rate and the
Trustee Fee Rate.
Expense Fees: As to each Mortgage Loan, the sum of the Servicing
Fee
and the Trustee Fee.
Extra Principal Distribution Amount: As of any Distribution Date,
the
lesser of (x) the related Total Monthly
Excess Spread for such Distribution
Date and (y) the related
Overcollateralization Deficiency for such
Distribution Date.
Fair Market Value Excess: As defined in Section 9.01.
Fannie Mae: The Federal National Mortgage Association and its
successors in interest.
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<PAGE>
Fannie Mae Guides: The Fannie Mae Seller's Guide and the Fannie
Mae
Servicer's Guide and all amendments or
additions thereto.
FDIC: The Federal Deposit Insurance Corporation, and its
successors
in interest.
Final Recovery Determination: With respect to any defaulted
Mortgage
Loan or any REO Property (other than a
Mortgage Loan or REO Property purchased
by the Responsible Party as contemplated by
this Agreement), a determination
made by the Servicer that all Insurance
Proceeds, Condemnation Proceeds,
Liquidation Proceeds and other payments or
recoveries which the Servicer, in
its reasonable good faith judgment, expects
to be finally recoverable in
respect thereof have been so recovered. The
Servicer shall maintain records,
prepared by a Servicing Officer, of each
Final Recovery Determination made
thereby.
Final Scheduled Distribution Date: The Final Scheduled
Distribution
Date for each Class of Certificates is the
Distribution Date occurring in June
2035.
First Lien Mortgage Loan: Any Mortgage Loan secured by a first
lien
Mortgage on the related Mortgaged
Property.
Fitch:
Fitch, Inc., and its successors in interest.
Fixed Rate: With respect to the Fixed Rate Certificates, 5.000%
per
annum on or prior to the first possible
Optional Termination Date, and 5.500%
per annum thereafter.
Fixed Rate Certificates: As specified in the Preliminary
Statement.
Forbearance: As defined in Section 3.07(a).
Freddie Mac: The Federal Home Loan Mortgage Corporation, a
corporate
instrumentality of the United States
created and existing under Title III of
the Emergency Home Finance Act of 1970, as
amended, and its successors in
interest.
Gross Margin: With respect to each Mortgage Loan, the fixed
percentage amount set forth in the related
Mortgage Note to be added to the
applicable Index to determine the Mortgage
Interest Rate.
Group I Mortgage Loans: The Mortgage Loans identified on the
Mortgage
Loan Schedule as Group I Mortgage
Loans.
Group II Mortgage Loans: The Mortgage Loans identified on the
Mortgage Loan Schedule as Group II Mortgage
Loans.
Group II Sequential Trigger Event: If, (i) on any Distribution
Date
before the 37th Distribution Date, (a) the
rolling three month average of the
aggregate unpaid principal balances of 60+
Day Delinquent Mortgage Loans
equals or exceeds 34.00% of the Senior
Enhancement Percentage as of the last
day of the prior Due Period or (b) the
aggregate amount of Realized Losses
incurred since the Cut-off Date through the
last day of the related Principal
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<PAGE>
Prepayment Period divided by the Cut-off
Date Pool Principal Balance exceeds
2.70%, or (ii) on any Distribution Date on
or after the 37th Distribution
Date, a Trigger Event is in effect.
High-Cost Mortgage Loan: A Mortgage Loan (a) covered by the
Home
Ownership and Equity Protection Act of
1994, (b) classified as "High-Cost,"
"threshold," "covered" or "predatory" loan
under any other applicable state,
federal or local law (or a similarly
classified loan using different
terminology under a law imposing heightened
regulatory scrutiny or additional
legal liability for residential mortgage
loans having high interest rates,
points and/or fees), or (c) a Mortgage Loan
categorized as High-Cost pursuant
to Appendix E of S&P Glossary.
Index: As to each Mortgage Loan, the index from time to time in
effect for the adjustment of the Mortgage
Interest Rate set forth as such on
the related Mortgage Note.
Insurance Policy: With respect to any Mortgage Loan included in
the
Trust Fund, any insurance policy, including
all riders and endorsements
thereto in effect, including any
replacement policy or policies for any
Insurance Policies.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds
of
insurance policies insuring the Mortgage
Loan or the related Mortgaged
Property.
Interest Accrual Period: With respect to any Distribution Date,
(i)
with respect to the LIBOR Certificates, the
period commencing on the
immediately preceding Distribution Date (or
commencing on the Closing Date in
the case of the first Distribution Date)
and ending on the day immediately
preceding the current Distribution Date,
and (ii) with respect to the Fixed
Rate Certificates, the calendar month
immediately preceding the month which
such Distribution Date occurs. For purposes
of computing interest accruals on
each Class of LIBOR Certificates, each
Interest Accrual Period has the actual
number of days in such period and each year
is assumed to have 360 days. For
purposes of computing interest accruals on
each Class of Fixed Rate
Certificates, each Interest Accrual Period
has 30 days in such period and each
year is assumed to have 360 days.
Interest Remittance Amount: With respect to any Distribution Date
and
the Mortgage Loans in a Loan Group, that
portion of Available Funds
attributable to interest relating to the
Mortgage Loans in such Loan Group.
Interest Rate Corridor Agreement: The interest rate corridor
agreement, dated August 10, 2005, between
Goldman Sachs Mortgage Company, L.P.
and the Corridor Provider, for the benefit
of the LIBOR Certificates.
Interest Rate Corridor Payment: For the first 32 Distribution
Dates,
the amount, if any, as calculated by the
Corridor Provider and reported to the
Trustee, equal to the product of (a) the
excess, if any, of one-month LIBOR
(as determined pursuant to the Interest
Rate Corridor Agreement) as of the
related reset date over a cap strike rate
set forth on the interest rate
corridor agreement schedule attached to the
Interest Rate Corridor Agreement,
up to 9.69841% per annum, (b) the interest
rate cap notional amount for such
date set forth on such schedule and (c) the
actual number of days in the
applicable Interest Accrual Period divided
by 360.
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<PAGE>
Investment Account: As defined in Section 3.12(a).
Late Collections: With respect to any Mortgage Loan and any Due
Period, all amounts received after the
Remittance Date immediately following
such Due Period, whether as late payments
of Scheduled Payments or as
Insurance Proceeds, Condemnation Proceeds,
Liquidation Proceeds or otherwise,
which represent late payments or
collections of principal and/or interest due
(without regard to any acceleration of
payments under the related Mortgage and
Mortgage Note) but delinquent for such Due
Period and not previously
recovered.
LIBOR: With respect to any Interest Accrual Period for the
LIBOR
Certificates, the rate determined by the
Trustee on the related LIBOR
Determination Date on the basis of the
offered rate for one month U.S. dollar
deposits as such rate appears on Telerate
Page 3750 as of 11:00 a.m. (London
time) on such date; provided, that if such
rate does not appear on Telerate
Page 3750, the rate for such date will be
determined on the basis of the rates
at which one-month U.S. dollar deposits are
offered by the Reference Banks at
approximately 11:00 a.m. (London time) on
such date to prime banks in the
London interbank market. In such event, the
Trustee shall request the
principal London office of each of the
Reference Banks to provide a quotation
of its rate. If at least two such
quotations are provided, the rate for that
date will be the arithmetic mean of the
quotations (rounded upwards if
necessary to the nearest whole multiple of
1/16%). If fewer than two
quotations are provided as requested, the
rate for that date will be the
arithmetic mean of the rates quoted by
major banks in New York City, selected
by the Trustee (after consultation with the
Depositor), at approximately 11:00
a.m. (New York City time) on such date for
one month U.S. dollar deposits of
leading European banks.
LIBOR Certificates: As specified in the Preliminary Statement.
LIBOR Determination Date: With respect to any Interest Accrual
Period
for each Class of LIBOR Certificates, the
second London Business Day preceding
the commencement of such Interest Accrual
Period.
Lifetime Rate Cap: The provision of each Mortgage Note which
provides
for an absolute maximum Mortgage Interest
Rate thereunder. The Mortgage
Interest Rate during the term of each
Mortgage Loan shall not at any time
exceed the Mortgage Interest Rate at the
time of origination of such
Adjustable Rate Mortgage Loan by more than
the amount per annum set forth on
the Mortgage Loan Schedule.
Liquidated Mortgage Loan: With respect to any Distribution Date,
a
defaulted Mortgage Loan (including any REO
Property) which was liquidated or
charged off in the calendar month preceding
the month of such Distribution
Date and as to which the Servicer has
certified (in accordance with this
Agreement) that it has made a Final
Recovery Determination.
Liquidation Event: With respect to any Mortgage Loan, any of
the
following events: (i) such Mortgage Loan is
paid in full; (ii) a Final
Recovery Determination is made as to such
Mortgage Loan; or (iii) such
Mortgage Loan is removed from coverage
under this Agreement by reason of its
being purchased, sold or replaced pursuant
to or as contemplated by this
Agreement. With respect to any REO
Property, either of the following events:
(i) a Final Recovery Determination is made
as to such REO Property; or (ii)
such REO Property is removed
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from coverage under this Agreement by
reason of its being purchased pursuant
to this Agreement.
Liquidation Proceeds: The amounts, other than Insurance
Proceeds,
Condemnation Proceeds or those received
following the acquisition of REO
Property, received in connection with the
liquidation of a defaulted Mortgage
Loan, whether through a trustee's sale,
foreclosure sale or otherwise,
including any Subsequent Recoveries.
Loan Group: The Group I Mortgage Loans or the Group II Mortgage
Loans, as applicable.
Loan Group Cap: The Loan Group I Cap or the Loan Group II Cap,
as
applicable.
Loan Group I Cap: With respect to the Group I Mortgage Loans as
of
any Distribution Date, the product of the
weighted average of the Adjusted Net
Mortgage Interest Rates then in effect on
the beginning of the related Due
Period on the Group I Mortgage Loans,
multiplied by 30 and divided by the
actual number of days in the related
Interest Accrual Period.
Loan Group II Cap: With respect to the Group II Mortgage Loans as
of
any Distribution Date, the product of the
weighted average of the Adjusted Net
Mortgage Interest Rates then in effect on
the beginning of the related Due
Period on the Group II Mortgage Loans,
multiplied by 30 and divided by the
actual number of days in the related
Interest Accrual Period.
Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan,
the
ratio (expressed as a percentage) of the
original outstanding principal amount
of the Mortgage Loan as of the Cut-off Date
(unless otherwise indicated), to
the lesser of (a) if the Mortgage Loan was
made to finance the acquisition of
the related Mortgaged Property, the
purchase price of the Mortgaged Property
and (ii) the Appraisal Value of the
Mortgaged Property at origination.
London Business Day: Any day on which dealings in deposits of
United
States dollars are transacted in the London
interbank market.
Lower-Tier Principal Amount: As described in the Preliminary
Statement.
Lower-Tier Regular Interest: Each of the Class LT-1A1, Class
LT-2A1,
Class LT-2A2, Class LT-2A3, Class LT-2A4,
Class LT-2A5, Class LT-M-1, Class
LT-M-2, Class LT-M-3, Class LT-M-4, Class
LT-M-5, Class LT-M-6 Class LT-B-1,
Class LT-B-2, Class LT-B-3, Class LT-B-4,
Class LT-Group I, Class LT-Group II
and Class LT-Accrual Interests as described
in the Preliminary Statement.
Lower-Tier REMIC: As described in the Preliminary Statement.
Market Value Change Report: A report setting forth changes in
property value of the Mortgaged Properties
in a format agreed upon by the
Servicer and the Depositor.
Monthly Statement: The statement made available to the
Certificateholders pursuant to Section
4.03.
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Moody's: Moody's Investors Service, Inc. If Moody's is designated
as
a Rating Agency in the Preliminary
Statement, for purposes of Section 10.05(b)
the address for notices to Moody's shall be
Moody's Investors Service, Inc.,
99 Church Street, New York, New York 10007,
Attention: Residential Mortgage
Pass-Through Group, or such other address
as Moody's may hereafter furnish to
the Depositor, the Servicer and the
Trustee.
Mortgage: The mortgage, deed of trust or other instrument
identified
on the Mortgage Loan Schedule as securing a
Mortgage Note.
Mortgage File: The items pertaining to a particular Mortgage
Loan
contained in either the Servicing File or
Custodial File.
Mortgage Interest Rate: The annual rate of interest borne on a
Mortgage Note with respect to each Mortgage
Loan.
Mortgage Loan: An individual Mortgage Loan which is the subject
of
this Agreement, each Mortgage Loan
originally sold and subject to this
Agreement being identified on the Mortgage
Loan Schedule, which Mortgage Loan
includes, without limitation, the Mortgage
File, the Custodial File, the
Servicing File, the Scheduled Payments,
Principal Prepayments, Liquidation
Proceeds, Condemnation Proceeds, Insurance
Proceeds, REO Disposition proceeds,
Prepayment Premiums and all other rights,
benefits, proceeds and obligations
arising from or in connection with such
Mortgage Loan, excluding repurchased
Mortgage Loans.
Mortgage Loan Documents: The mortgage loan documents pertaining
to
each Mortgage Loan.
Mortgage Loan Schedule: A schedule of Mortgage Loans annexed
hereto
as Schedule I, such schedule setting forth
the following information with
respect to each Mortgage Loan as of the
Cut-off Date: (1) the Responsible
Party's Mortgage Loan identifying number;
(2) the Mortgagor's name; (3) the
street address of the Mortgaged Property
including the city, state and zip
code; (4) a code indicating whether the
Mortgaged Property is owner-occupied,
a second home or investment property (as
indicated by the Mortgagor at the
time of origination of the Mortgage Loan);
(5) the number and type of
residential units constituting the
Mortgaged Property (i.e., a single family
residence, a 2-4 family residence, a unit
in a condominium project or a unit
in a planned unit development, manufactured
housing); (6) the Mortgage Loan
origination date; (7) the original months
to maturity or the remaining months
to maturity from the related Cut-off Date,
in any case based on the original
amortization schedule and, if different,
the maturity expressed in the same
manner but based on the actual amortization
schedule; (8) the Loan-to-Value
Ratio at origination; (9) with respect to
First Lien Loans, the LTV; (10) the
Mortgage Interest Rate as of the related
Cut-off Date; (11) the date on which
the Monthly Payment was due on the Mortgage
Loan and, if such date is not
consistent with the Due Date currently in
effect, such Due Date; (12) the
stated maturity date; (13) the amount of
the Monthly Payment as of the related
Cut-off Date; (14) the last payment date as
of which a payment was actually
applied to the outstanding principal
balance (i.e. the paid through date);
(15) the original principal amount of the
Mortgage Loan; (16) the principal
balance of the Mortgage Loan as of the
close of business on the related
Cut-off Date, after deduction of payments
of principal due
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<PAGE>
and collected on or before the Cut-off
Date; (17) the Interest Rate Adjustment
Date; (18) the Gross Margin; (19) the
Lifetime Rate Cap under the terms of the
Mortgage Note; (20) a code indicating the
type of Index; (21) the Mortgage
Interest Rate as of origination; (22) the
type of Mortgage Loan (i.e.,
fixed-rate, adjustable-rate); (23) the lien
status of the Mortgage Loan; (24)
a code indicating the purpose of the loan
(i.e., purchase, refinance, cash-out
refinance); (25) a code indicating the
documentation style (i.e., full,
limited, or stated income); (26) the credit
risk classification (as described
in the Underwriting Guidelines); (27) the
applicable Cut-off Date; (28) the
applicable Closing Date; (29) a code
indicating whether the Mortgage Loan is a
High Cost Loan or Home Loan as such terms
are defined in the then current S&P
Glossary; (30) the FICO score; (31) with
respect to the related Mortgagor, the
debt-to-income ratio; (32) the Appraised
Value of the Mortgaged Property; (33)
the sale price of the Mortgaged Property if
the Mortgage Loan was originated
in connection with the purchase of the
Mortgaged Property; (34) the Periodic
Rate Cap under the terms of the Mortgage
Note; (35) the Periodic Rate Floor
under the terms of the Mortgage Note; (36)
whether such Mortgage Loan provides
for a prepayment charge; (37) the
prepayment charge period of such Mortgage
Loan, if applicable; (38) a description of
the type of prepayment charge, if
applicable; (39) a code indicating if the
Mortgage Loan is a Balloon Mortgage
Loan; (40) the initial and periodic
mortgage interest rate adjustment period;
(41) mortgage interest rate adjustment
percentage; (42) a code indicating
whether Mortgage Loan is assumable; (43) a
code indicating whether Mortgage
Loan has been modified; (44) one year
payment history; (45) due date for first
monthly payment; (46) original monthly
payment due; (47) S&P doc type code;
(48) S&P appraisal type code; (49)
escrow holdbacks, if any; and (50) total
points and fees paid by the Mortgagor. With
respect to the Mortgage Loans in
the aggregate, the Mortgage Loan Schedule
shall set forth the following
information, as of the related Cut-off
Date: (1) the number of Mortgage Loans;
(2) the current aggregate outstanding
principal balance of the Mortgage Loans;
(3) the weighted average Mortgage Interest
Rate of the Mortgage Loans; and (4)
the weighted average maturity of the
Mortgage Loans.
Mortgage Note: The note or other evidence of the indebtedness of
a
Mortgagor under a Mortgage Loan, including
all riders thereto.
Mortgaged Property: The real property (or leasehold estate, if
applicable) identified on the Mortgage Loan
Schedule as securing repayment of
the debt evidenced by a Mortgage Note.
Mortgagor: The obligor(s) on a Mortgage Note.
Net Monthly Excess Cash Flow: For any Distribution Date the
amount
remaining for distribution pursuant to
Section 4.02(a)(iii) (before giving
effect to distributions pursuant to such
Section 4.02(a)(iii)).
Net Prepayment Interest Shortfall: For any Distribution Date,
the
amount by which the sum of the Prepayment
Interest Shortfalls exceeds the sum
of the Compensating Interest payments made
with respect to such Distribution
Date.
NIM Issuer: The entity established as the issuer of the NIM
Securities.
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<PAGE>
NIM Securities:
Any debt securities secured or otherwise backed by
some or all of the Class X, Class P and
Class C Certificates.
NIM Trustee: The trustee for the NIM Securities.
Nonrecoverable P&I Advance: Any P&I Advance previously made
or
proposed to be made in respect of a
Mortgage Loan or REO Property that, in the
good faith business judgment of the
Servicer, will not or, in the case of a
proposed P&I Advance, would not be
ultimately recoverable from related late
payments, Insurance Proceeds, Condemnation
Proceeds or Liquidation Proceeds on
such Mortgage Loan or REO Property as
provided herein.
Nonrecoverable Servicing Advance: Any Servicing Advances
previously
made or proposed to be made in respect of a
Mortgage Loan or REO Property,
which, in the good faith business judgment
of the Servicer, will not or, in
the case of a proposed Servicing Advance,
would not, be ultimately recoverable
from related Insurance Proceeds,
Condemnation Proceeds, Liquidation Proceeds
or otherwise.
Notice of Final Distribution: The notice to be provided pursuant
to
Section 9.02 to the effect that final
distribution on any of the Certificates
shall be made only upon presentation and
surrender thereof.
Offered Certificates: As specified in the Preliminary
Statement.
Officer's Certificate: A certificate signed by an officer of
the
Servicer with responsibility for the
servicing of the Mortgage Loans and
listed on a list delivered to the Trustee
pursuant to this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be
in-house
counsel for the Servicer or the
Subservicer, reasonably acceptable to the
Trustee; provided, that any Opinion of
Counsel relating to (a) qualification
of either Trust REMIC as a REMIC or (b)
compliance with the REMIC Provisions,
must be (unless otherwise stated in such
Opinion of Counsel) an opinion of
counsel who (i) is in fact independent of
the Servicer of the Mortgage Loans,
(ii) does not have any material direct or
indirect financial interest in the
Servicer of the Mortgage Loans or in an
affiliate of either and (iii) is not
connected with the Servicer of the Mortgage
Loans as an officer, employee,
director or person performing similar
functions.
Optional Termination Date: The date determined as follows: the
Servicer shall cause the Optional
Termination Date to occur on any
Distribution Date when the aggregate Stated
Principal Balance of the Mortgage
Loans, as of the last day of the related
Due Period, is equal to 10% or less
of the Cut-off Date Pool Principal
Balance.
Original Sale Date: June 15, 2005.
OTS: Office of Thrift Supervision, and any successor thereto.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore
executed and authenticated under
this Agreement except:
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<PAGE>
(i) Certificates theretofore canceled by the Trustee or delivered
to
the Trustee for
cancellation; and
(ii) Certificates in exchange for which or in lieu of which
other
Certificates
have been executed and delivered by the Trustee pursuant to
this
Agreement.
Outstanding Mortgage Loan: As of any Due Date, a Mortgage Loan with
a
Stated Principal Balance greater than zero
which was not the subject of a
Principal Prepayment in Full prior to such
Due Date and which did not become a
Liquidated Mortgage Loan prior to such Due
Date.
Overcollateralized Amount: As of any Distribution Date, the
excess,
if any, of (a) the aggregate Stated
Principal Balance of the Mortgage Loans
for such Distribution Date over (b) the
aggregate of the Class Certificate
Balances of the Principal Certificates as
of such Distribution Date (after
giving effect to the payment of the
Principal Remittance Amount on such
Certificates on such Distribution
Date).
Overcollateralization Deficiency: With respect to any
Distribution
Date, the excess, if any, of (a) the
Specified Overcollateralized Amount
applicable to such Distribution Date over
(b) the Overcollateralized Amount
applicable to such Distribution Date.
Overcollateralization Floor: With respect to any Distribution
Date,
0.50% of the aggregate Stated Principal
Balance of the Mortgage Loans as of
the Cut-off Date.
Overcollateralization Reduction Amount: With respect to any
Distribution Date, an amount equal to the
lesser of (a) the Excess
Overcollateralized Amount and (b) the Net
Monthly Excess Cash Flow.
Ownership Interest: As to any Residual Certificate, any
ownership
interest in such Certificate including any
interest in such Certificate as the
Holder thereof and any other interest
therein, whether direct or indirect,
legal or beneficial.
P&I Advance: As to any Mortgage Loan or REO Property, any
advance
made by the Servicer in respect of any
Remittance Date representing the
aggregate of all payments of principal and
interest, net of the Servicing Fee,
that were due during the related Due Period
on the Mortgage Loans and that
were delinquent on the related Remittance
Date, plus certain amounts
representing assumed payments not covered
by any current net income on the
Mortgaged Properties acquired by
foreclosure or deed in lieu of foreclosure as
determined pursuant to Section 4.01.
Pass-Through Margin: With respect to each Class of LIBOR
Certificates, the following percentages:
Class 1A1 Certificates, 0.290%; Class
2A1 Certificates, 0.130%; Class 2A2
Certificates, 0.280%; Class 2A3
Certificates, 0.320%; Class 2A4
Certificates, 0.370%; Class 2A5 Certificates,
0.400%; Class M-1 Certificates, 0.500%;
Class M-2 Certificates, 0.530%; Class
M-3 Certificates, 0.550%; Class M-4
Certificates, 0.650%; Class M-5
Certificates, 0.710%; Class M-6
Certificates, 0.770%; Class B-1 Certificates,
1.350%; Class B-2 Certificates, 1.450%; and
Class B-3 Certificates, 1.900%. On
the first Distribution Date after the first
possible Optional Termination
Date, the Pass-Through Margins shall
increase to: Class 1A1
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Certificates, 0.580%; Class 2A1
Certificates, 0.260%; Class 2A2 Certificates,
0.560%; Class 2A3 Certificates, 0.640%;
Class 2A4 Certificates, 0.740%; Class
2A5 Certificates, 0.800%; Class M-1
Certificates, 0.750%; Class M-2
Certificates, 0.795%; Class M-3
Certificates, 0.825%; Class M-4 Certificates,
0.975%; Class M-5 Certificates, 1.065%;
Class M-6 Certificates, 1.155%; Class
B-1 Certificates, 2.025%; Class B-2
Certificates, 2.175% and Class B-3
Certificates, 2.850%.
Pass-Through Rate: For each Class of Certificates and each
Lower-Tier
Regular Interest, the per annum rate set
forth or calculated in the manner
described in the Preliminary Statement.
Percentage Interest: As to any Certificate, the percentage
interest
evidenced thereby in distributions required
to be made on the related Class,
such percentage interest being set forth on
the face thereof or equal to the
percentage obtained by dividing the
Denomination of such Certificate by the
aggregate of the Denominations of all
Certificates of the same Class.
Periodic Mortgage Interest Rate Cap: With respect to each
Mortgage
Loan, the provision of each Mortgage Note
which provides for an absolute
maximum amount by which the Mortgage
Interest Rate therein may increase or
decrease on an Adjustment Date above or
below the Mortgage Interest Rate
previously in effect. The Periodic Mortgage
Interest Rate Cap for each
Mortgage Loan is the rate set forth on the
Mortgage Loan Schedule.
Periodic Mortgage Interest Rate Floor: With respect to each
Mortgage
Loan, the provision of each Mortgage Note
which provides for an absolute
minimum amount by which the Mortgage
Interest Rate therein may increase or
decrease on an Adjustment Date above or
below the Mortgage Interest Rate
previously in effect. The Periodic Mortgage
Interest Rate Floor for each
Mortgage Loan is the rate set forth on the
Mortgage Loan Schedule.
Permitted Investments: Any one or more of the following
obligations
or securities acquired at a purchase price
of not greater than par, regardless
of whether issued by the Servicer, the
Trustee or any of their respective
Affiliates:
(i) direct obligations of, or obligations fully guaranteed as
to
timely payment
of principal and interest by, the United States or any
agency or
instrumentality thereof, provided such obligations are backed
by the full
faith and credit of the United States;
(ii) demand and time deposits in, certificates of deposit of,
or
bankers'
acceptances (which shall each have an original maturity of not
more than 90
days and, in the case of bankers' acceptances, shall in no
event have an
original maturity of more than 365 days or a remaining
maturity of more
than 30 days) denominated in United States dollars and
issued by any
Depository Institution and rated P-1 by Moody's and "F1+"
by Fitch;
(iii) repurchase obligations with respect to any security
described
in clause (i)
above entered into with a Depository Institution (acting as
principal);
(iv) securities bearing interest or sold at a discount that are
issued by any
corporation incorporated under the laws of the United
States of
America or any state
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thereof and that
are rated by each Rating Agency that rates such
securities in
its highest long term unsecured rating categories at the
time of such
investment or contractual commitment providing for such
investment;
(v) commercial paper (including both non interest bearing
discount
obligations and
interest bearing obligations payable on demand or on a
specified date
not more than 30 days after the date of acquisition
thereof) that is
rated by each Rating Agency that rates such securities
in its highest
short term unsecured debt rating available at the time of
such
investment;
(vi) units of money market funds, including money market funds
advised by the
Depositor or the Trustee or an Affiliate thereof, that
have been rated
"Aaa" by Moody's and "AAAm," "AAAm-G" by S&P and at least
"AA" by Fitch
(in each case, to the extent they are designated as Rating
Agencies in the
Preliminary Statement); and
(vii) if previously confirmed in writing to the Trustee, any
other
demand, money
market or time deposit, or any other obligation, security
or investment,
as may be acceptable to the Rating Agencies as a permitted
investment of
funds backing "Aaa" or "AAA" rated securities;
provided, however, that no instrument
described hereunder shall evidence
either the right to receive (a) only
interest with respect to the obligations
underlying such instrument or (b) both
principal and interest payments derived
from obligations underlying such instrument
and the interest and principal
payments with respect to such instrument
provide a yield to maturity at par
greater than 120% of the yield to maturity
at par of the underlying
obligations. For investments in the
Distribution Account (except during the
Trustee Float Period), only the obligations
or securities (or instruments
which invest in the obligations or
securities) specified in clause (i) above
shall constitute Permitted Investments.
Permitted Transferee: Any Person other than (i) the United
States,
any State or political subdivision thereof,
or any agency or instrumentality
of any of the foregoing, (ii) a foreign
government, international organization
or any agency or instrumentality of either
of the foregoing, (iii) an
organization (except certain farmers'
cooperatives described in Section 521 of
the Code) which is exempt from tax imposed
by Chapter 1 of the Code (including
the tax imposed by Section 511 of the Code
on unrelated business taxable
income) on any excess inclusions (as
defined in Section 860E(c)(1) of the
Code) with respect to any Residual
Certificate, (iv) rural electric and
telephone cooperatives described in Section
1381(a)(2)(C) of the Code, (v) a
Person that is not a U.S. Person or a U.S.
Person with respect to whom income
from a Residual Certificate is attributable
to a foreign permanent
establishment or fixed base (within the
meaning of an applicable income tax
treaty) of such Person or any other U.S.
Person, (vi) an "electing large
partnership" within the meaning of Section
775 of the Code and (vii) any other
Person so designated by the Depositor based
upon an Opinion of Counsel that
the Transfer of an Ownership Interest in a
Residual Certificate to such Person
may cause either the Lower-Tier REMIC or
the Upper-Tier REMIC to fail to
qualify as a REMIC at any time that the
Certificates are outstanding. The
terms "United States," "State" and
"international organization" shall have the
meanings set forth in Section 7701 of the
Code or successor provisions. A
corporation will not be treated as an
instrumentality of the United States or
of any State or
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political subdivision thereof for these
purposes if all of its activities are
subject to tax and, with the exception of
Freddie Mac, a majority of its board
of directors is not selected by such
government unit.
Person: Any individual, corporation, partnership, joint
venture,
association, limited liability company,
joint stock company, trust,
unincorporated organization or government,
or any agency or political
subdivision thereof.
Physical Certificates: As specified in the Preliminary
Statement.
Pool Stated Principal Balance: As to any Distribution Date, the
aggregate of the Stated Principal Balances
of the Mortgage Loans for such
Distribution Date that were Outstanding
Mortgage Loans on the Due Date in the
related Due Period.
Prepayment Interest Shortfall: With respect to any Remittance
Date,
the sum of, for each Mortgage Loan that was
during the related Prepayment
Period the subject of a Principal
Prepayment that was applied by the Servicer
to reduce the outstanding principal balance
of such Mortgage Loan on a date
preceding the Due Date in the succeeding
Prepayment Period, an amount equal to
the product of (a) the Mortgage Interest
Rate net of the Servicing Fee Rate
for such Mortgage Loan, (b) the amount of
the Principal Prepayment for such
Mortgage Loan, (c) 1/360 and (d) the number
of days commencing on the date on
which such Principal Prepayment was applied
and ending on the last day of the
related Prepayment Period.
Prepayment Period: With respect to any Remittance Date, the
calendar
month preceding the calendar month in which
such Remittance Date occurs.
Prepayment Premium: Any prepayment premium, penalty or charge
collected by the Servicer with respect to a
Mortgage Loan from a Mortgagor in
connection with any voluntary Principal
Prepayment pursuant to the terms of
the related Mortgage Note.
Principal Certificates: As specified in the Preliminary
Statement.
Principal Distribution Amount: For any Distribution Date, the sum
of
(i) the Basic Principal Distribution Amount
for such Distribution Date and
(ii) the Extra Principal Distribution
Amount for such Distribution Date.
Principal Prepayment: Any full or partial payment or other
recovery
of principal on a Mortgage Loan (including
upon liquidation of a Mortgage
Loan) which is received in advance of its
scheduled Due Date, excluding any
Prepayment Premium and which is not
accompanied by an amount of interest
representing scheduled interest due on any
date or dates in any month or
months subsequent to the month of
prepayment.
Principal Prepayment in Full: Any Principal Prepayment made by
a
Mortgagor of the entire principal balance
of a Mortgage Loan.
Principal Remittance Amount: With respect to any Distribution
Date,
the amount equal to the sum of the
following amounts (without duplication)
with respect to the related Due Period: (i)
each scheduled payment of
principal on a Mortgage Loan due during
such Due
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Period and received by the Servicer on or
prior to the related Determination
Date or advanced by the Servicer prior to
the related Remittance Date, (ii)
all Principal Prepayments received during
the related Prepayment Period, (iii)
all Liquidation Proceeds, Condemnation
Proceeds and Insurance Proceeds on the
Mortgage Loans allocable to principal
actually collected by the Servicer
during the related Prepayment Period, (iv)
the portion of the Repurchase Price
allocable to principal with respect to each
Mortgage Loan, the repurchase
obligation for which arose during the
related Prepayment Period, that was
repurchased during the period from the
Remittance Date prior to the prior
Distribution Date (or from the Closing Date
in the case of the first
Distribution Date) through the Remittance
Date for the current Distribution
Date and (v) the allocable portion of the
proceeds received with respect to
the termination of the Trust Fund pursuant
to clause (a) of Section 9.01 (to
the extent such proceeds relate to
principal).
Privacy Laws: Title V of the Gramm Leach Bliley Act of 1999, as
amended, and all applicable regulations
promulgated thereunder.
Private Certificates: As specified in the Preliminary
Statement.
Prospectus Supplement: The Prospectus Supplement, dated August
22,
2005, relating to the Offered
Certificates.
PTCE 95-60: As defined in Section 5.02(b).
PUD: A planned unit development.
Purchase Agreement: The Amended and Restated Flow Mortgage Loan
Purchase and Warranties Agreement, dated as
of June 1, 2005, between the
Purchaser and the Responsible Party.
Purchaser: Goldman Sachs Mortgage Company, a New York limited
partnership, and its successors in
interest.
Rating Agency: Each of the Rating Agencies specified in the
Preliminary Statement. If such organization
or a successor is no longer in
existence, "Rating Agency" shall be such
nationally recognized statistical
rating organization, or other comparable
Person, as is designated by the
Depositor, notice of which designation
shall be given to the Trustee.
References herein to a given rating or
rating category of a Rating Agency
shall mean such rating category without
giving effect to any modifiers. For
purposes of Section 10.05(b), the addresses
for notices to each Rating Agency
shall be the address specified therefor in
the definition corresponding to the
name of such Rating Agency, or such other
address as either such Rating Agency
may hereafter furnish to the Depositor and
the Servicer.
Realized Losses: With respect to any date of determination and
any
Liquidated Mortgage Loan, the amount, if
any, by which (a) the unpaid
principal balance of such Liquidated
Mortgage Loan together with accrued and
unpaid interest thereon exceeds (b) the
Liquidation Proceeds with respect
thereto net of the expenses incurred by the
Servicer in connection with the
liquidation of such Liquidated Mortgage
Loan and net of the amount of
unreimbursed Servicing Advances with
respect to such Liquidated Mortgage Loan.
34
<PAGE>
Record Date: With respect to any Distribution Date, the close
of
business on the last day of the related
Interest Accrual Period; provided,
however, that for any Certificate issued in
definitive form, the Record Date
shall be the close of business on the last
Business Day of the month preceding
the month in which such applicable
Distribution Date occurs.
Reference Bank: As defined in Section 4.04.
Regular Certificates: As specified in the Preliminary
Statement.
Relief Act Interest Shortfall: With respect to any Distribution
Date
and any Mortgage Loan, any reduction in the
amount of interest collectible on
such Mortgage Loan for the most recently
ended Due Period as a result of the
application of the Servicemembers Civil
Relief Act or any similar state
statutes.
REMIC: A "real estate mortgage investment conduit" within the
meaning
of Section 860D of the Code.
REMIC Opinion: As defined in Section 9.03.
REMIC Provisions: Provisions of the federal income tax law
relating
to real estate mortgage investment
conduits, which appear at Sections 860A
through 860G of Subchapter M of Chapter 1
of the Code, and related provisions,
and regulations promulgated thereunder, as
the foregoing may be in effect from
time to time as well as provisions of
applicable state laws.
Remittance Date: With respect to any Distribution Date, no later
than
12:30 PM, Central Time on the Business Day
immediately preceding such
Distribution Date.
REO Disposition: The
final sale by the Servicer of any REO Property.
REO Imputed Interest: As to any REO Property, for any period,
an
amount equivalent to interest (at the
Mortgage Interest Rate net of the
Servicing Fee Rate that would have been
applicable to the related Mortgage
Loan had it been outstanding) on the unpaid
principal balance of the Mortgage
Loan as of the date of acquisition thereof
(as such balance is reduced
pursuant to Section 3.15 by any income from
the REO Property treated as a
recovery of principal).
REO Property: A Mortgaged Property acquired by the Trust Fund
through
foreclosure or deed in lieu of foreclosure
in connection with a defaulted
Mortgage Loan.
Reporting Date: The 18th day of each calendar month or the
immediately following Business Day if the
18th is not a Business Day.
Repurchase Price: With respect to any Mortgage Loan, an amount
equal
to the sum of (i) the unpaid principal
balance of such Mortgage Loan as of the
date of repurchase, (ii) interest on such
unpaid principal balance of such
Mortgage Loan at the Mortgage Interest Rate
from the last date through which
interest has been paid and distributed to
the Trustee to the date of
repurchase, (iii) all unreimbursed
Servicing Advances and (iv) all expenses
incurred by the
35
<PAGE>
Servicer, the Trust or the Trustee, as the
case may be, in respect of a breach
or defect, including, without limitation,
expenses arising out of the
Servicer's or Trustee's, as the case may
be, enforcement of the Responsible
Party's repurchase obligation, to the
extent not included in clause (iii) and
(v) any costs and damages incurred by the
Trust in connection with any
violation by such Mortgage Loan of any
predatory lending law or abusive
lending law.
Request for Release: The Request for Release submitted by the
Servicer to the Trustee, substantially in
the form of Exhibit J.
Residual Certificates: As specified in the Preliminary
Statement.
Responsible Officer: When used with respect to the Trustee, any
vice
president, any assistant vice president,
any assistant secretary, any
assistant treasurer, any associate or any
other officer of the Trustee
customarily performing functions similar to
those performed by any of the
above designated officers who at such time
shall be officers to whom, with
respect to a particular matter, such matter
is referred because of such
officer's knowledge of and familiarity with
the particular subject and who
shall have direct responsibility for the
administration of this Agreement.
Responsible Party: Ameriquest Mortgage Company, a Delaware
corporation, and its successors in
interest.
Review Appraisal Value: As defined in the Underwriting
Guidelines.
Rule 144A Letter: As defined in Section 5.02(b).
S&P: Standard & Poor's Ratings Services, a division of
The
McGraw-Hill Companies, Inc, and its
successors in interest. If S&P is
designated as a Rating Agency in the
Preliminary Statement, for purposes of
Section 10.05(b) the address for notices to
S&P shall be Standard & Poor's, 55
Water Street, New York, New York 10041,
Attention: Residential Mortgage
Surveillance Group - GSAA Home Equity Trust
2005-10, or such other address as
S&P may hereafter furnish to the
Depositor, the Servicer and the Trustee.
S&P Glossary: Version 5.6 of the Standard & Poor's
LEVELS(R)
Glossary.
Scheduled Payment: The scheduled monthly payment on a Mortgage
Loan
due on any Due Date allocable to principal
and/or interest on such Mortgage
Loan which, unless otherwise specified
herein, shall give effect to any
related Debt Service Reduction and any
Deficient Valuation that affects the
amount of the monthly payment due on such
Mortgage Loan.
Securities Act: The Securities Act of 1933, as amended.
Senior Enhancement Percentage: With respect to any Distribution
Date,
the percentage obtained by dividing (x) the
sum of (i) the aggregate Class
Certificate Balance of the Subordinated
Certificates and (ii) the
Overcollateralized Amount (in each case
after taking into account the
distributions of the Principal Distribution
Amount for such Distribution Date)
by (y) the aggregate Stated Principal
Balance of the Mortgage Loans for such
Distribution Date.
36
<PAGE>
Senior Specified Enhancement Percentage: As of any date of
determination, 46.30%.
Servicer: Countrywide Servicing and if a successor servicer is
appointed hereunder, such successor
servicer.
Servicer Remittance Report: As defined in Section 4.03(d).
Servicing Advances: The reasonable "out of pocket" costs and
expenses
(including legal fees) incurred by the
Servicer in the performance of its
servicing obligations in connection with a
default, delinquency or other
unanticipated event, including, but not
limited to, the cost of (i) the
preservation, restoration, inspection and
protection of a Mortgaged Property,
(ii) any enforcement or judicial
proceedings, including foreclosures and
litigation, in respect of a particular
Mortgage Loan, (iii) the management
(including reasonable fees in connection
therewith) and liquidation of any REO
Property, (iv) the performance of its
obligations under Sections 3.01, 3.09,
3.13 and 3.15. Servicing Advances also
include any reasonable "out of pocket"
costs and expenses (including legal fees)
incurred by the Servicer in
connection with executing and recording
instruments of satisfaction, deeds of
reconveyance or Assignments of Mortgage in
connection with any satisfaction or
foreclosures in respect of any Mortgage
Loan to the extent not recovered from
the Mortgagor or otherwise payable under
this Agreement and (v) obtaining or
correcting any legal documentation required
to be included in the Mortgage
Files and necessary for the Servicer to
perform its obligations under this
Agreement. The Servicer shall not be
required to make any Nonrecoverable
Servicing Advances.
Servicing Fee: With respect to each Mortgage Loan and any
Distribution Date, an amount equal to the
product of (i) one twelfth of the
Servicing Fee Rate, and (ii) the Stated
Principal Balance of such Mortgage
Loan as of the first day of the calendar
month preceding the month in which
such Distribution Date occurs. Such fee
shall be payable monthly, and shall be
pro rated for any portion of a month during
which the Mortgage Loan is
serviced by the Servicer under this
Agreement. The Servicing Fee is payable
solely from the interest portion (including
recoveries with respect to
interest from Liquidation Proceeds,
Insurance Proceeds, Condemnation Proceeds
and proceeds received with respect to REO
Properties, to the extent permitted
by Section 3.11) of such Scheduled Payment
collected by the Servicer or as
otherwise provided under Section 3.11.
Servicing Fee Rate: With respect to each Mortgage Loan, 0.50%
per
annum.
Servicing File: With respect to each Mortgage Loan, the file
retained
by the Servicer consisting of originals or
copies of all documents in the
Mortgage File which are not delivered to
the Trustee in the Custodial File and
copies of the Mortgage Loan Documents set
forth in Exhibit K hereto.
Servicing Officer: Any officer of the Servicer involved in, or
responsible for, the administration and
servicing of the Mortgage Loans whose
name and facsimile signature appear on a
list of servicing officers furnished
to the Trustee by the Servicer on the
Closing Date pursuant to this Agreement,
as such list may from time to time be
amended.
Similar Law: As defined in Section 5.02(b).
37
<PAGE>
Six-Month LIBOR Index: With respect to each Mortgage Loan, the
rate
as determined on the basis of rates at
which six-month U.S. dollar deposits
are offered to prime banks in the London
interbank market on such date as
provided in the related Mortgage Note.
Specified Overcollateralized Amount: Prior to the Stepdown Date,
an
amount equal to 2.50% of the Cut-off Date
Pool Principal Balance. On and after
the Stepdown Date, an amount equal to 5.00%
of the aggregate Stated Principal
Balance of the Mortgage Loans for such
Distribution Date, subject, until the
Class Certificate Balance of each Class of
Principal Certificates has been
reduced to zero, to a minimum amount equal
to the Overcollateralization Floor;
provided, however, that if, on any
Distribution Date, a Trigger Event has
occurred, the Specified Overcollateralized
Amount shall not be reduced to the
applicable percentage of the then current
aggregate Stated Principal Balance
of the Mortgage Loans but instead will
remain the same as the prior period's
Specified Overcollateralized Amount until
the Distribution Date on which a
Trigger Event is no longer occurring. When
the Class Certificate Balance of
each class of Principal Certificates has
been reduced to zero, the Specified
Overcollateralized Amount will thereafter
be equal to zero.
Start-up Day: As defined in Section 2.06.
Stated Principal Balance: As to each Mortgage Loan and as of any
date
of determination, (i) the principal balance
of the Mortgage Loan at the
Cut-off Date after giving effect to
payments of principal due on or before
such date, minus (ii) all amounts
previously remitted to the Trustee with
respect to the related Mortgage Loan
representing payments or recoveries of
principal including advances in respect of
scheduled payments of principal.
For purposes of any Distribution Date, the
Stated Principal Balance of any
Mortgage Loan will give effect to any
scheduled payments of principal received
by the Servicer on or prior to the related
Determination Date or advanced by
the Servicer for the related Remittance
Date and any unscheduled principal
payments and other unscheduled principal
collections received during the
related Prepayment Period, and the Stated
Principal Balance of any Mortgage
Loan that has prepaid in full or has become
a Liquidated Mortgage Loan during
the related Prepayment Period shall be
zero.
Stepdown Date: The earlier to occur of (a) the date on which
the
aggregate Class Certificate Balances of the
Class A Certificates have been
reduced to zero, and (b) the later to occur
of (i) the Distribution Date in
September 2008, and (ii) the first
Distribution Date on which the Senior
Enhancement Percentage is greater than or
equal to the Senior Specified
Enhancement Percentage.
Subordinated Certificates: As specified in the Preliminary
Statement.
Subsequent Recoveries: Amounts received with respect to any
Liquidated Mortgage Loan after it has
become a Liquidated Mortgage Loan.
Subservicer: As defined in Section 3.02(a).
Subservicing Account: As defined in Section 3.08.
Subservicing Agreements: As defined in Section 3.02(a).
38
<PAGE>
Tax Matters Person: The Holder of the Class R-1 and Class R-2
Certificates is designated as "tax matters
person" of the Lower-Tier REMIC and
the Upper-Tier REMIC, respectively, in the
manner provided under Treasury
Regulations Section 1.806F-4(d) and
Treasury Regulations Section
301.6234(a)(7)-1.
Tax Service Contract: As defined in Section 3.09(a).
Telerate Page 3750: The display page currently so designated on
the
Bridge Telerate Service (or such other page
as may replace that page on that
service for displaying comparable rates or
prices).
Termination Price: As defined in Section 9.01.
Total Monthly Excess Spread: As to any Distribution Date, an
amount
equal to the excess if any, of (i) the
interest collected on the Mortgage
Loans received by the Servicer on or prior
to the related Determination Date
or advanced by the Servicer for the related
Remittance Date (net of Expense
Fees over (ii) the sum of amounts payable
to the Principal Certificates on
such Distribution Date pursuant to Section
4.02(a)(i).
Transfer: Any direct or indirect transfer or sale of any
Ownership
Interest in a Residual Certificate.
Transfer Affidavit: As defined in Section 5.02(c).
Transferor Certificate: As defined in Section 5.02(b).
Trigger Event: With respect to any Distribution Date, a Trigger
Event
exists if (i) the quotient (expressed as a
percentage) of (1) the rolling
three month average of the aggregate unpaid
principal balance of 60+ Day
Delinquent Mortgage Loans, divided by (2)
the aggregate unpaid principal
balance of the Mortgage Loans as of the
last day of the related Due Period,
equals or exceeds 34.00% of the Senior
Enhancement Percentage as of the last
day of the prior Due Period or (ii) the
quotient (expressed as a percentage)
of (x) the aggregate amount of Realized
Losses incurred since the Cut-off Date
through the last day of the related
Prepayment Period divided by (y) the
Cut-off Date Pool Principal Balance exceeds
the applicable percentages set
forth below with respect to such
Distribution Date:
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------------
Distribution Date Occurring In
Cumulative Realized Loss Percentage
--------------------------------------------------------------------------------------------------------------------------
<S>
<C>
September 2007 through August 2008
1.200% for the first month, plus an additional 1/12th of
1.500% for each
month thereafter (e.g., approximately
1.325% in October 2007)
--------------------------------------------------------------------------------------------------------------------------
September 2008 through August 2009
2.700% for the first month, plus an additional 1/12th of
1.550% for each
month thereafter (e.g., approximately
2.829% in October 2008)
--------------------------------------------------------------------------------------------------------------------------
September 2009 through August 2010
4.250% for
the first month, plus
an additional
--------------------------------------------------------------------------------------------------------------------------
39
<PAGE>
--------------------------------------------------------------------------------------------------------------------------
1/12th of 1.250% for
each month
thereafter
(e.g.,
approximately 4.354% in October 2009)
---------------------------------------------------------------------------------------------------------------------------
September 2010 through August 2011
5.500% for the first month, plus an additional 1/12th of
0.650% for each
month thereafter (e.g., approximately
5.554% in October 2010)
---------------------------------------------------------------------------------------------------------------------------
September 2011 and thereafter
6.150%
--------------------------------------------------------------------------------------------------------------------------
</TABLE>
Trust: The express trust created hereunder in Section 2.01(c).
Trust Fund: The corpus of the trust created hereunder consisting
of
(i) the Mortgage Loans and all interest and
principal received on or with
respect thereto after the related Cut-off
Date, other than such amounts which
were due on the Mortgage Loans on or before
the related Cut-off Date; (ii) the
Interest Rate Corridor Agreement and all
amounts received thereunder; (iii)
the Collection Account, Excess Reserve Fund
Account, the Distribution Account,
and all amounts deposited therein pursuant
to the applicable provisions of
this Agreement; (iv) property that secured
a Mortgage Loan and has been
acquired by foreclosure, deed in lieu of
foreclosure or otherwise; and (v) all
proceeds of the conversion, voluntary or
involuntary, of any of the foregoing.
Trust REMIC: Either the Lower-Tier REMIC or the Upper-Tier REMIC,
as
applicable.
Trustee: Deutsche Bank National Trust Company, and its successors
in
interest and, if a successor trustee is
appointed hereunder, such successor.
Trustee Fee: As to each Mortgage Loan and any Distribution Date,
an
amount equal to one month's interest at the
related Trustee Fee Rate on the
Stated Principal Balance of such Mortgage
Loan as of the preceding
Distribution Date (or as of the Closing
Date in the case of the first
Distribution Date) or, in the event of any
payment of interest which
accompanies a Principal Prepayment in Full
made by the Mortgagor, interest at
the Trustee Fee Rate on the Stated
Principal Balance of such Mortgage Loan for
the period covered by such payment of
interest.
Trustee Fee Rate: With respect to each Mortgage Loan, 0.0070%
per
annum.
Trustee Float Period: With respect to any Distribution Date and
the
related amounts in the Distribution
Account, the period commencing on the
Business Day immediately preceding such
Distribution Date and ending on such
Distribution Date.
Underwriters' Exemption: Any exemption listed in footnote 1 of,
and
amended by, Prohibited Transaction
Exemption 2002-41, 67 Fed. Reg. 54487
(2002), or amended by Prohibited
Transaction Exemption 2002-19, 67 Fed. Reg.
14979, or any successor exemption.
40
<PAGE>
Underwriting Guidelines: The underwriting guidelines attached to
the
Purchase Agreement.
Unpaid Interest Amount: As of any Distribution Date and any Class
of
Certificates, the sum of (a) the portion of
the Accrued Certificate Interest
Distribution Amount from Distribution Dates
prior to the current Distribution
Date remaining unpaid immediately prior to
the current Distribution Date and
(b) interest on the amount in clause (a)
above at the applicable Pass-Through
Rate (to the extent permitted by applicable
law).
Upper-Tier Regular Interest: As described in the Preliminary
Statement.
Upper-Tier REMIC: As described in the Preliminary Statement.
U.S.
Person: (i) A citizen or resident of the United States; (ii) a
corporation (or entity treated as a
corporation for tax purposes) created or
organized in the United States or under the
laws of the United States or of
any State thereof, including, for this
purpose, the District of Columbia;
(iii) a partnership (or entity treated as a
partnership for tax purposes)
organized in the United States or under the
laws of the United States or of
any State thereof, including, for this
purpose, the District of Columbia
(unless provided otherwise by future
Treasury regulations); (iv) an estate
whose income is includible in gross income
for United States income tax
purposes regardless of its source; or (v) a
trust, if a court within the
United States is able to exercise primary
supervision over the administration
of the trust and one or more U.S. Persons
have authority to control all
substantial decisions of the trust.
Notwithstanding the last clause of the
preceding sentence, to the extent provided
in Treasury regulations, certain
trusts in existence on August 20, 1996, and
treated as U.S. Persons prior to
such date, may elect to continue to be U.S.
Persons.
Voting Rights: The portion of the voting rights of all of the
Certificates which is allocated to any
Certificate. As of any date of
determination, (a) 1% of all Voting Rights
shall be allocated to the Class X
Certificates, if any (such Voting Rights to
be allocated among the holders of
Certificates of each such Class in
accordance with their respective Percentage
Interests), (b) 1% of all Voting Rights
shall be allocated to the Class P
Certificates, if any (such Voting Rights to
be allocated among the holders of
Certificates of each such Class in
accordance with their respective Percentage
Interests), (c) 1% of all Voting Rights
shall be allocated to the Class C
Certificates, if any (such Voting Rights to
be allocated among the holders of
Certificates of each such Class in
accordance with their respective Percentage
Interests), and (d) the remaining Voting
Rights shall be allocated among
Holders of the remaining Classes of
Certificates in proportion to the
Certificate Balances of their respective
Certificates on such date.
WAC Cap: With respect to the Mortgage Loans as of any
Distribution
Date, a per annum rate equal to (a) the
weighted average of the Mortgage
Interest Rates for each Mortgage Loan (in
each case, less the applicable
Expense Fee Rate) on the beginning of the
related Due Period on the Mortgage
Loans, multiplied by (b) 30 divided by the
actual number of days in the
related Interest Accrual Period, in the
case of the LIBOR Certificates, and 30
divided by 360, in the case of the Fixed
Rate Certificates.
41
<PAGE>
ARTICLE
II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
Section 2.01 Conveyance of Mortgage Loans. (a) The Depositor,
concurrently with the execution and
delivery hereof, hereby sells, transfers,
assigns, sets over and otherwise conveys to
the Trustee for the benefit of the
Certificateholders, without recourse, all
the right, title and interest of the
Depositor in and to the Trust Fund and the
Trustee, on behalf of the Trust,
hereby accepts the Trust Fund.
(b) In connection with the transfer and assignment of each
Mortgage
Loan, the Depositor has delivered or caused
to be delivered to the Trustee for
the benefit of the Certificateholders the
following documents or instruments
with respect to each Mortgage Loan so
assigned:
(i) either (a) the original Mortgage Note bearing all
intervening
endorsements,
evidencing a complete chain of assignments from the
originator to
the last endorsee, endorsed "Pay to the order of
_____________,
without recourse" and signed in the name of the last
endorsee. To the
extent that there is no room on the face of the Mortgage
Notes for
endorsements, the endorsement may be contained on an allonge
and the Trustee
is so advised that state law does not allow. If the
Mortgage Loan
was acquired by the last endorsee in a merger, the
endorsement must
be by "[last endorsee], successor by merger to [name of
predecessor]".
If the Mortgage Loan was acquired or originated by the last
endorsee while
doing business under another name, the endorsement must be
by "[last
endorsee], formerly known as [previous name]" or (b) with
respect to not
more than 1% of the Mortgage Loans, a lost note affidavit
acceptable in
form and substance to the Trustee;
(ii) the original of any guarantee executed in connection with
the
Mortgage
Note;
(iii) the original Mortgage with evidence of recording thereon. If
in
connection with
any Mortgage Loan, the Depositor cannot deliver or cause
to be delivered
the original Mortgage with evidence of recording thereon
on or prior to
the Closing Date because of a delay caused by the public
recording office
where such Mortgage has been delivered for recordation
or because such
Mortgage has been lost or because such public recording
office retains
the original recorded Mortgage, the Depositor shall
deliver or cause
to be delivered to the Trustee, a photocopy of such
Mortgage,
together with (A) in the case of a delay caused by the public
recording
office, an Officer's Certificate (or certified by the title
company, escrow
agent or closing attorney) stating that such Mortgage has
been dispatched
to the appropriate public recording office for
recordation and
that the original recorded Mortgage or a copy of such
Mortgage
certified by such public recording office to be a true and
complete copy of
the original recorded Mortgage will be promptly
delivered or
caused to be delivered to the Trustee upon receipt thereof
by the
Depositor; or (B) in the case of a Mortgage where a public
recording office
retains the original recorded Mortgage or in the case
where a Mortgage
is lost after recordation in a
42
<PAGE>
public recording
office, a copy of such Mortgage certified by such public
recording office
to be a true and complete copy of the original recorded
Mortgage;
(iv) the
originals of all assumption, modification, consolidation or
extension
agreements, if any, with evidence of recording thereon;
(v) the original Assignment of Mortgage for each Mortgage Loan,
in
form and
substance acceptable for recording. The Assignment of Mortgage
must be duly
recorded only if recordation is either necessary under
applicable law
or commonly required by private institutional mortgage
investors in the
area where the Mortgaged Property is located or as
provided in this
Agreement. If the Assignment of Mortgage is to be
recorded, the
Mortgage shall be assigned to the Trustee. If the
Assignment of
Mortgage is not to be recorded, the Assignment of Mortgage
shall be
delivered in blank. If the Mortgage Loan was acquired by the
last endorsee in
a merger, the Assignment of Mortgage must be made by
"[last
endorsee], successor by merger to [name of predecessor]". If
the
Mortgage Loan
was acquired or originated by the last endorsee while doing
business under
another name, the Assignment of Mortgage must be by "[last
endorsee],
formerly known as [previous name]";
(vi) the originals of all intervening Assignments of Mortgage,
evidencing a
complete chain of assignment from the originator to the last
endorsee, either
unrecorded or with evidence of recording thereon, or if
any such
intervening assignment has not been returned from the
applicable
recording office
or has been lost or if such public recording office
retains the
original recorded Assignments of Mortgage, the Depositor
shall deliver or
cause to be delivered to the Trustee, a photocopy of
such intervening
assignment, together with (A) in the case of a delay
caused by the
public recording office, an Officer's Certificate stating
that such
intervening Assignment of Mortgage has been dispatched to the
appropriate
public recording office for recordation and that such
original
recorded intervening Assignment of Mortgage or a copy of such
intervening
Assignment of Mortgage certified by the appropriate public
recording office
to be a true and complete copy of the original recorded
intervening
Assignment of Mortgage will be promptly delivered or caused to
be delivered to
the Trustee upon receipt thereof by the Depositor; or (B)
in the case of
an intervening assignment where a public recording office
retains the
original recorded intervening assignment or in the case where
an intervening
assignment is lost after recordation in a public recording
office, a copy
of such intervening assignment certified by such public
recording office
to be a true and complete copy of the original recorded
intervening
assignment;
(vii) the original mortgagee policy of title insurance or, in
the
event such
original title policy is unavailable, a certified true copy of
the related
policy binder or commitment for title certified to be true
and complete by
the title insurance company; and
(viii) a security agreement, chattel mortgage or equivalent
document
executed in
connection with the Mortgage (if provided).
43
<PAGE>
The Depositor shall deliver or cause to be delivered to the
Trustee
the applicable recorded document promptly
upon receipt from the respective
recording office but in no event later than
120 days from the Closing Date.
From time to time, the Depositor shall cause to be forwarded,
with
respect to the Mortgage Loans, to the
Trustee additional original documents,
additional documents evidencing an
assumption, modification, consolidation or
extension of a Mortgage Loan approved by
the Responsible Party, in accordance
with the terms of this Agreement. All such
mortgage documents held by the
Trustee as to each Mortgage Loan shall
constitute the "Custodial File."
On or prior to the Closing Date, the Depositor shall deliver or
cause
to be delivered to the Trustee Assignments
of Mortgages, in blank, for each
Mortgage Loan. The Depositor shall cause
the Assignments of Mortgage with
completed recording information to be
provided to the Servicer in a reasonably
acceptable manner. No later than thirty
(30) Business Days following the later
of the Closing Date and the date of receipt
by the Servicer of the fully
completed Assignments of Mortgages in
recordable form, the Servicer shall
promptly submit or cause to be submitted
for recording, at the expense of the
Depositor, at no expense to the Trust Fund,
the Servicer or the Trustee in the
appropriate public office for real property
records, each Assignment of
Mortgage referred to in Section 2.01(b)(v).
Notwithstanding the foregoing,
however, for administrative convenience and
facilitation of servicing and to
reduce closing costs, the Assignments of
Mortgage shall not be required to be
completed and submitted for recording with
respect to any Mortgage Loan if the
Trustee and each Rating Agency has received
an opinion of counsel,
satisfactory in form and substance to the
Trustee and each Rating Agency, to
the effect that the recordation of such
Assignments of Mortgage in any
specific jurisdiction is not necessary to
protect the Trustee's interest in
the related Mortgage Note. If the
Assignment of Mortgage is to be recorded,
the Depositor shall cause the Mortgage to
be assigned at its expense to
"Deutsche Bank National Trust Company as
trustee under the Pooling and
Servicing Agreement dated as of August 1,
2005, GSAA Home Equity Trust
2005-10." In the event that any such
assignment is lost or returned unrecorded
because of a defect therein, the Depositor
shall promptly cause to be prepared
a substitute assignment to cure such defect
and thereafter cause each such
assignment to be duly recorded.
On or prior to the Closing Date, the Depositor shall deliver to
the
Trustee a copy of the Data Tape Information
in electronic, machine readable
medium in a form mutually acceptable to the
Depositor and the Trustee. Within
ten (10) Business Days of the Closing Date,
the Depositor shall deliver a copy
of the complete Mortgage Loan Schedule to
the Trustee.
In the event, with respect to each Mortgage Loan, that such
original
or copy of any document submitted for
recordation to the appropriate public
recording office is not so delivered to the
Trustee within 90 days following
the Closing Date, and in the event that the
Depositor does not cure or cause
to be cured such failure within 30 days of
discovery or receipt of written
notification of such failure, the
Responsible Party shall repurchase such
Mortgage Loan pursuant to its obligations
under the Purchase Agreement at the
price and in the manner specified in
Section 2.03. The foregoing repurchase
obligation shall not apply in the event
that the Responsible Party cannot
deliver such original or copy of any
document submitted for recordation to the
appropriate public recording office within
the specified period due to a delay
caused by the recording office in the
applicable
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jurisdiction; provided, that the
Responsible Party shall instead deliver a
recording receipt of such recording office
or, if such recording receipt is
not available, an officer's certificate of
an officer of the Responsible Party
confirming that such document has been
accepted for recording.
Notwithstanding anything to the contrary contained in this
Section
2.01, in those instances where the public
recording office retains or loses
the original Mortgage or assignment after
it has been recorded, the
obligations of the Depositor shall be
deemed to have been satisfied upon the
Depositor delivering or causing to be
delivered to the Trustee prior to the
Closing Date a copy of such Mortgage or
assignment, as the case may be,
certified (such certification to be an
original thereof) by the public
recording office to be a true and complete
copy of the recorded original
thereof.
(c) The Depositor does hereby establish, pursuant to the
further
provisions of this Agreement and the laws
of the State of New York, an express
trust (the "Trust") to be known, for
convenience, as "GSAA Home Equity Trust
2005-10" and Deutsche Bank National Trust
Company is hereby appointed as
Trustee in accordance with the provisions
of this Agreement. The parties
hereto acknowledge and agree that it is the
policy and intention of the Trust
to acquire only Mortgage Loans meeting the
requirements set forth in this
Agreement, including without limitation,
the representations and warranties
set forth in paragraph (49) of Schedule III
to this Agreement.
(d) The Trust shall have the capacity, power and authority, and
the
Trustee on behalf of the Trust is hereby
authorized, to accept the sale,
transfer, assignment, set over and
conveyance by the Depositor to the Trust of
all the right, title and interest of the
Depositor in and to the Trust Fund
(including, without limitation, the
Mortgage Loans) pursuant to Section
2.01(a).
Section 2.02 Acceptance by the Trustee of the Mortgage Loans.
The
Trustee acknowledges receipt of the
documents identified in the Initial
Certification in the form annexed hereto as
Exhibit E, and declares that it
holds and will hold such documents and the
other documents delivered to it
pursuant to Section 2.01, and that it holds
or will hold such other assets as
are included in the Trust Fund, in trust
for the exclusive use and benefit of
all present and future Certificateholders.
The Trustee acknowledges that it
will maintain possession of the related
Mortgage Notes in the State of
California, unless otherwise permitted by
the Rating Agencies.
Prior to and as a condition to the Closing Date, the Trustee
shall
deliver via facsimile (with original to
follow the next Business Day) to the
Depositor and the Servicer an Initial
Certification prior to the Closing Date,
or as the Depositor agrees to, on the
Closing Date, certifying receipt of a
Mortgage Note and Assignment of Mortgage
for each Mortgage Loan with any
exceptions thereon. The Trustee shall not
be responsible to verify the
validity, sufficiency or genuineness of any
document in any Custodial File.
On the Closing Date, the Trustee shall ascertain that all
documents
required to be reviewed by it are in its
possession, and shall deliver to the
Depositor and the Servicer an Initial
Certification, in the form annexed
hereto as Exhibit E, and shall deliver to
the Depositor and the Servicer a
Document Certification and Exception
Report, in the form annexed hereto as
Exhibit
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F, within 90 days after the Closing Date to
the effect that, as to each
Mortgage Loan listed in the Mortgage Loan
Schedule (other than any Mortgage
Loan paid in full or any Mortgage Loan
specifically identified in such
certification as an exception and not
covered by such certification): (i) all
documents required to be reviewed by it are
in its possession; (ii) such
documents have been reviewed by it and
appear regular on their face and relate
to such Mortgage Loan; (iii) based on its
examination and only as to the
foregoing documents, the information set
forth in items (1), (2), (3), (7)
(solely with respect to the original months
to maturity), (10) (solely as of
origination, not as of the Cut-off Date)
and (15) of the Mortgage Loan
Schedule and items (1), (2), (3), (7)
(solely with respect to the original
months to maturity), (10) (solely as of
origination, not as of the Cut-off
Date) and (15) of the Data Tape Information
respecting such Mortgage Loan is
correct; and (iv) each Mortgage Note has
been endorsed as provided in Section
2.01 of this Agreement. The Trustee shall
not be responsible to verify the
validity, sufficiency or genuineness of any
document in any Custodial File.
The Trustee shall retain possession and custody of each
Custodial
File in accordance with and subject to the
terms and conditions set forth
herein. The Servicer shall promptly deliver
to the Trustee, upon the execution
or receipt thereof, the originals of such
other documents or instruments
constituting the Custodial File as come
into the possession of the Servicer
from time to time.
The Depositor shall cause to be delivered to the Servicer copies
of
all trailing documents required to be
included in the Custodial File at the
same time the original or certified copies
thereof are delivered to the
Trustee, including but not limited to such
documents as the title insurance
policy and any other Mortgage Loan
documents upon return from the public
recording office. The Depositor, at its
expense, shall cause the documents to
be delivered to the Servicer.
Section 2.03 Representations, Warranties and Covenants of the
Responsible Party and the Servicer. (a)
Countrywide Servicing hereby makes the
representations and warranties set forth in
Schedule II hereto, respectively,
to the Depositor, the Responsible Party and
the Trustee as of the Closing
Date.
(b) The Responsible Party hereby makes the representations and
warranties set forth in Schedule III and
Schedule IV hereto to the Depositor,
Countrywide Servicing and the Trustee.
(c) It is understood and agreed by the Countrywide Servicing and
the
Responsible Party that the representations
and warranties set forth in this
Section 2.03 shall survive the transfer of
the Mortgage Loans by the Depositor
to the Trustee, and shall inure to the
benefit of the Depositor and the
Trustee notwithstanding any restrictive or
qualified endorsement on any
Mortgage Note or Assignment of Mortgage or
the examination or failure to
examine any Mortgage File. Upon discovery
by any of the Responsible Party, the
Depositor, the Trustee or the Servicer of a
breach of any of the foregoing
representations and warranties, the party
discovering such breach shall give
prompt written notice to the others.
(d) Within 30 days of the earlier of either discovery by or notice
to
the Responsible Party that any Mortgage
Loan does not conform to the
requirements as determined
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in the Trustee's review of the related
Custodial File or within 60 days of the
earlier of either discovery by or notice to
the Responsible Party of any
breach of a representation or warranty set
forth in Section 2.03(b) that
materially and adversely affects the value
of any Mortgage Loan or the
interest of the Trustee or the
Certificateholders therein, the Responsible
Party shall use its best efforts to cause
to be remedied a material defect in
a document constituting part of a Mortgage
File or promptly to cure such
breach in all material respects and, if
such defect or breach cannot be
remedied, the Responsible Party shall
repurchase such Mortgage Loan at the
Repurchase Price. In the event that a
breach which materially and adversely
affects the value of the related Mortgage
Loan or Mortgage Loans, as the case
may be, or the interests of the Trustee or
the Certificateholders therein,
shall involve any representation or
warranty set forth in Schedule III, and
such breach cannot be cured within 60 days
of the earlier of either discovery
by or notice to the Responsible Party of
such breach, all of the Mortgage
Loans shall, at the Depositor's option, be
repurchased by the Responsible
Party at the Repurchase Price.
Notwithstanding the foregoing, a breach by the
Responsible Party of any of the
representations and warranties set forth in
paragraphs (39), (45), (46), (47), (49) or
(56) of Schedule III, in each case,
will be deemed automatically to materially
and adversely affect the value of
such Mortgage Loan and the interests of the
Trustee and Certificateholders in
such Mortgage Loan. In the event that the
Trustee receives notice of a breach
by the Responsible Party of any of the
representations and warranties set
forth in paragraphs (39), (45), (46), (47),
(49) or (56) of Schedule III, the
Trustee shall give notice of such breach to
the Responsible Party and request
the Responsible Party to repurchase the
Mortgage Loan at the Repurchase Price
within sixty (60) days of the Responsible
Party's receipt of such notice. In
addition, in the event of a breach of the
representation and warranty set
forth in paragraph (m) of Schedule IV, the
Responsible Party shall repurchase
the Mortgage Loans such that the aggregate
principal balance of the Mortgage
Loans with lost note affidavits shall not
be in excess of 1.0% of the total
aggregate principal balance of all the
Mortgage Loans.
(e) In connection with any repurchase of a Mortgage Loan pursuant
to
this Section 2.03, the Servicer shall,
based on information provided by the
Responsible Party, amend the Mortgage Loan
Schedule for the benefit of the
Certificateholders to reflect the removal
of such Mortgage Loan and the
Servicer shall deliver the amended Mortgage
Loan Schedule to the Trustee.
(f) In addition to such repurchase obligation, the Responsible
Party
shall indemnify the Depositor, any of its
Affiliates, the Servicer and the
Trustee and hold such parties harmless
against any losses, damages, penalties,
fines, forfeitures, reasonable and
necessary legal fees and related costs,
judgments, and other costs and expenses
resulting from any claim, demand,
defense or assertion based on or grounded
upon, or resulting from, a breach by
the Responsible Party of any of its
representations and warranties contained
in the Purchase Agreement or this
Agreement.
(g) In the event that the Responsible Party shall have repurchased
a
Mortgage Loan, the Repurchase Price
therefor shall be deposited in the
Collection Account pursuant to Section 3.10
on or before the next Remittance
Date and upon such deposit of the
Repurchase Price and receipt of a Request
for Release in the form of Exhibit J
hereto, the Trustee shall release the
related Custodial File held for the benefit
of the Certificateholders to such
Person as directed by the Servicer, and the
Trustee shall execute and deliver
at such Person's direction such
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instruments of transfer or assignment
prepared by such Person, in each case
without recourse, as shall be necessary to
transfer title from the Trustee. It
is understood and agreed that the
obligation under this Agreement of any
Person to cure, repurchase or replace any
Mortgage Loan as to which a breach
has occurred and is continuing shall
constitute the sole remedy against such
Persons respecting such breach available to
Certificateholders, the Depositor,
the Servicer or the Trustee on their
behalf.
The representations and warranties made pursuant to this Section
2.03
shall survive delivery of the respective
Custodial Files to the Trustee for
the benefit of the Certificateholders.
Section 2.04
[Reserved.]
Section 2.05 Execution and Delivery of Certificates. The
Trustee
acknowledges the transfer and assignment to
it of the Trust Fund and,
concurrently with such transfer and
assignment, has executed and delivered to
or upon the order of the Depositor, the
Certificates in authorized
denominations evidencing directly or
indirectly the entire ownership of the
Trust Fund. The Trustee agrees to hold the
Trust Fund and exercise the rights
referred to above for the benefit of all
present and future Holders of the
Certificates.
Section 2.06 REMIC Matters. The Preliminary Statement sets forth
the
designations for federal income tax
purposes of all interests created hereby.
The "Start-up Day" for purposes of the
REMIC Provisions shall be the Closing
Date. The "latest possible maturity date"
is the Distribution Date in June
2035, which is the Distribution Date
following the latest Mortgage Loan
maturity date. Amounts paid to the Class X
Certificates (prior to any
reduction for any Basis Risk Payment) shall
be deemed paid from the Upper-Tier
REMIC in respect of the Class X Interest to
the holders of the Class X
Certificates prior to distribution of Basis
Risk Payments to the Principal
Certificates.
Section 2.07 Representations and Warranties of the Depositor.
The
Depositor hereby represents, warrants and
covenants to the Trustee, the
Servicer and the Responsible Party that as
of the date of this Agreement or as
of such date specifically provided
herein:
(a) The Depositor is a corporation duly organized, validly
existing
and in good standing under the laws of the
State of Delaware;
(b) The Depositor has the corporate power and authority to convey
the
Mortgage Loans and to execute, deliver and
perform, and to enter into and
consummate the transactions contemplated
by, this Agreement;
(c) This Agreement has been duly and validly authorized, executed
and
delivered by the Depositor, all requisite
corporate action having been taken,
and, assuming the due authorization,
execution and delivery hereof by the
parties hereto, constitutes or will
constitute the legal, valid and binding
agreement of the Depositor, enforceable
against the Depositor in accordance
with its terms, except as such enforcement
may be limited by bankruptcy,
insolvency, reorganization, moratorium or
other similar laws relating to or
affecting the rights of creditors
generally, and by general equity principles
(regardless of whether such enforcement is
considered in a proceeding in
equity or at law);
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(d) No consent, approval, authorization or order of or
registration
or filing with, or notice to, any
governmental authority or court is required
for the execution, delivery and performance
of or compliance by the Depositor
with this Agreement or the consummation by
the Depositor of any of the
transactions contemplated hereby, except as
have been made on or prior to the
Closing Date;
(e) None of the execution and delivery of this Agreement, the
consummation of the transactions
contemplated hereby or thereby, or the
fulfillment of or compliance with the terms
and conditions of this Agreement,
(i) conflicts or will conflict with or
results or will result in a breach of,
or constitutes or will constitute a default
or results or will result in an
acceleration under (A) the charter or
bylaws of the Depositor, or (B) of any
term, condition or provision of any
material indenture, deed of trust,
contract or other agreement or instrument
to which the Depositor or any of its
subsidiaries is a party or by which it or
any of its subsidiaries is bound;
(ii) results or will result in a violation
of any law, rule, regulation,
order, judgment or decree applicable to the
Depositor of any court or
governmental authority having jurisdiction
over the Depositor or its
subsidiaries; or (iii) results in the
creation or imposition of any lien,
charge or encumbrance which would have a
material adverse effect upon the
Mortgage Loans or any documents or
instruments evidencing or securing the
Mortgage Loans;
(f) There are no actions, suits or proceedings before or against
or
investigations of, the Depositor pending,
or to the knowledge of the
Depositor, threatened, before any court,
administrative agency or other
tribunal, and no notice of any such action,
which, in the Depositor's
reasonable judgment, might materially and
adversely affect the performance by
the Depositor of its obligations under this
Agreement, or the validity or
enforceability of this Agreement;
(g) The Depositor is not in default with respect to any order
or
decree of any court or any order,
regulation or demand of any federal, state,
municipal or governmental agency that may
materially and adversely affect its
performance hereunder; and
(h) Immediately prior to the transfer and assignment by the
Depositor
to the Trustee on the Closing Date, the
Depositor had good title to, and was
the sole owner of each Mortgage Loan, free
of any interest of any other
Person, and the Depositor has transferred
all right, title and interest in
each Mortgage Loan to the Trustee. The
transfer of each Mortgage Note and each
Mortgage as and in the manner contemplated
by this Agreement is sufficient
either (i) fully to transfer to the
Trustee, for the benefit of the
Certificateholders, all right, title, and
interest of the Depositor thereto as
note holder and mortgagee or (ii) to grant
to the Trustee, for the benefit of
the Certificateholders, the security
interest referred to in Section 10.04.
It is understood and agreed that the representations, warranties
and
covenants set forth in this Section 2.07
shall survive delivery of the
respective Custodial Files to the Trustee
or to a custodian, as the case may
be, and shall inure to the benefit of the
Trustee.
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ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01 Servicer to Service Mortgage Loans. (a) For and on
behalf of the Certificateholders, the
Servicer shall service and administer
the Mortgage Loans in accordance with the
terms of this Agreement and the
respective Mortgage Loans and, to the
extent consistent with such terms, in
compliance with all applicable federal,
state and local laws, and in the same
manner in which it services and administers
similar mortgage loans for its own
portfolio, giving due consideration to
customary and usual standards of
practice of mortgage lenders and loan
servicers administering similar mortgage
loans but without regard to:
(i) any
relationship that the Servicer, any Subservicer or any
Affiliate
of the Servicer or any Subservicer may have with the related
Mortgagor;
(ii) the ownership or
non ownership of any Certificate by the Servicer or
any Affiliate of the Servicer;
(iii) the Servicer's
obligation to make P&I Advances or Servicing Advances;
or
(iv) the Servicer's
or any Subservicer's right to receive compensation for
its services hereunder or with respect to any particular
transaction.
To the extent consistent with the foregoing, the Servicer shall
seek
to maximize the timely and complete
recovery of principal and interest on the
Mortgage Notes. Subject only to the above
described servicing standards and
the terms of this Agreement and of the
respective Mortgage Loans, the Servicer
shall have full power and authority, acting
alone or through Subservicers as
provided in Section 3.02, to do or cause to
be done any and all things in
connection with such servicing and
administration which it may deem necessary
or desirable. Without limiting the
generality of the foregoing, the Servicer
in its own name or in the name of a
Subservicer is hereby authorized and
empowered by the Trustee when the Servicer
believes it appropriate in its best
judgment in accordance with the Accepted
Servicing Practices set forth above,
to execute and deliver any and all
instruments of satisfaction or
cancellation, or of partial or full release
or discharge, and all other
comparable instruments, with respect to the
Mortgage Loans and the Mortgaged
Properties and to institute foreclosure
proceedings or obtain a deed in lieu
of foreclosure so as to convert the
ownership of such properties, and to hold
or cause to be held title to such
properties, on behalf of the Trustee and in
the name of the Trust. The Servicer shall
service and administer the Mortgage
Loans in accordance with applicable state
and federal law and shall provide to
the Mortgagors any reports required to be
provided to them thereby. The
Servicer shall also comply in the
performance of this Agreement with all
reasonable rules and requirements of each
insurer under any standard hazard
insurance policy. Subject to Section 3.16,
the Trustee shall execute, at the
written request of the Servicer, and
furnish to the Servicer and any
Subservicer such documents as are necessary
or appropriate to enable the
Servicer or any Subservicer to carry out
their servicing and administrative
duties hereunder, and the Trustee hereby
grants to the Servicer, and this
Agreement shall constitute, a power of
attorney to carry
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out such duties including a power of
attorney to take title to Mortgaged
Properties after foreclosure on behalf of
the Trustee and in the name of the
Trust. The Trustee shall execute a power of
attorney in favor of the Servicer
for the purposes described herein to the
extent necessary or desirable to
enable the Servicer to perform its duties
hereunder. The Trustee shall not be
liable for the actions of the Servicer or
any Subservicers under such powers
of attorney.
(b) Subject to Section 3.09(b), in accordance with the standards
of
the preceding paragraph, the Servicer shall
advance or cause to be advanced
funds as necessary for the purpose of
effecting the timely payment of taxes
and assessments on the Mortgaged
Properties, which advances shall be Servicing
Advances reimbursable in the first instance
from related collections from the
Mortgagors pursuant to Section 3.09(b), and
further as provided in Section
3.11. Any cost incurred by the Servicer or
by Subservicers in effecting the
timely payment of taxes and assessments on
a Mortgaged Property shall not be
added to the unpaid principal balance of
the related Mortgage Loan,
notwithstanding that the terms of such
Mortgage Loan so permit.
(c) Notwithstanding anything in this Agreement to the contrary,
the
Servicer may not make any future advances
with respect to a Mortgage Loan
(except as provided in Section 4.01) and
the Servicer shall not (i) permit any
modification with respect to any Mortgage
Loan that would change the Mortgage
Interest Rate, reduce or increase the
principal balance (except for reductions
resulting from actual payments of
principal) or change the final maturity date
on such Mortgage Loan (except for (A) a
reduction of interest payments
resulting from the application of the
Servicemembers Civil Relief Act or any
similar state statutes or (B) as provided
in Section 3.07, if the Mortgagor is
in default with respect to the Mortgage
Loan or such default is, in the
judgment of the Servicer, reasonably
foreseeable or (ii) permit any
modification, waiver or amendment of any
term of any Mortgage Loan that would
both (A) effect an exchange or reissuance
of such Mortgage Loan under Section
1001 of the Code (or final, temporary or
proposed Treasury regulations
promulgated thereunder) and (B) cause
either Trust REMIC to fail to qualify as
a REMIC under the Code or the imposition of
any tax on "prohibited
transactions" or "contributions after the
Start-up day" under the REMIC
Provisions, or (iii) except as provided in
Section 3.07(a), waive any
Prepayment Premiums.
(d) The Servicer may delegate its responsibilities under this
Agreement; provided, however, that no such
delegation shall release the
Servicer from the responsibilities or
liabilities arising under this
Agreement.
Section 3.02 Subservicing Agreements between the Servicer and
Subservicers. (a) The Servicer may enter
into subservicing agreements with
subservicers (each, a "Subservicer"), for
the servicing and administration of
the Mortgage Loans ("Subservicing
Agreements").
(b) Each Subservicer shall be (i) authorized to transact business
in
the state or states in which the related
Mortgaged Properties it is to service
are situated, if and to the extent required
by applicable law to enable the
Subservicer to perform its obligations
hereunder and under the Subservicing
Agreement, (ii) an institution approved as
a mortgage loan originator by the
Federal Housing Administration or an
institution that has deposit accounts
insured by the FDIC and (iii) a Freddie Mac
or Fannie Mae approved mortgage
servicer. Each Subservicing
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Agreement must impose on the Subservicer
requirements conforming to the
provisions set forth in Section 3.08 and
provide for servicing of the Mortgage
Loans consistent with the terms of this
Agreement. The Servicer will examine
each Subservicing Agreement and will be
familiar with the terms thereof. The
terms of any Subservicing Agreement will
not be inconsistent with any of the
provisions of this Agreement. The Servicer
and the Subservicers may enter into
and make amendments to the Subservicing
Agreements or enter into different
forms of Subservicing Agreements; provided,
however, that any such amendments
or different forms shall be consistent with
and not violate the provisions of
this Agreement, and that no such amendment
or different form shall be made or
entered into which could be reasonably
expected to be materially adverse to
the interests of the Trustee, without the
consent of the Trustee. Any
variation without the consent of the
Trustee from the provisions set forth in
Section 3.08 relating to insurance or
priority requirements of Subservicing
Accounts, or credits and charges to the
Subservicing Accounts or the timing
and amount of remittances by the
Subservicers to the Servicer, are
conclusively deemed to be inconsistent with
this Agreement and therefore
prohibited. The Servicer shall deliver to
the Trustee and the Depositor copies
of all Subservicing Agreements, and any
amendments or modifications thereof,
promptly upon the Servicer's execution and
delivery of such instruments.
(c) As part of its servicing activities hereunder, the Servicer
(except as otherwise provided in the last
sentence of this paragraph), for the
benefit of the Trustee, shall enforce the
obligations of each Subservicer
under the related Subservicing Agreement,
including, without limitation, any
obligation to make advances in respect of
delinquent payments as required by a
Subservicing Agreement. Such enforcement,
including, without limitation, the
legal prosecution of claims, termination of
Subservicing Agreements, and the
pursuit of other appropriate remedies,
shall be in such form and carried out
to such an extent and at such time as the
Servicer, in its good faith business
judgment, would require were it the owner
of the related Mortgage Loans. The
Servicer shall pay the costs of such
enforcement at its own expense, and shall
be reimbursed therefor only (i) from a
general recovery resulting from such
enforcement, to the extent, if any, that
such recovery exceeds all amounts due
in respect of the related Mortgage Loans or
(ii) from a specific recovery of
costs, expenses or attorneys' fees against
the party against whom such
enforcement is directed.
Section 3.03 Successor Subservicers. The Servicer shall be
entitled
to terminate any Subservicing Agreement and
the rights and obligations of any
Subservicer pursuant to any Subservicing
Agreement in accordance with the
terms and conditions of such Subservicing
Agreement. In the event of
termination of any Subservicer, all
servicing obligations of such Subservicer
shall be assumed simultaneously by the
Servicer without any act or deed on the
part of such Subservicer or the Servicer,
and the Servicer either shall
service directly the related Mortgage Loans
or shall enter into a Subservicing
Agreement with a successor Subservicer
which qualifies under Section 3.02.
Any Subservicing Agreement shall include the provision that
such
agreement may be immediately terminated by
the Depositor or the Trustee
without fee, in accordance with the terms
of this Agreement, in the event that
the Servicer shall, for any reason, no
longer be the Servicer (including
termination due to an Event of
Default).
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Section 3.04 Liability of the Servicer. Notwithstanding any
Subservicing Agreement, any of the
provisions of this Agreement relating to
agreements or arrangements between the
Servicer and a Subservicer or reference
to actions taken through a Subservicer or
otherwise, the Servicer shall remain
obligated and primarily liable to the
Trustee for the servicing and
administering of the Mortgage Loans in
accordance with the provisions of
Section 3.01 without diminution of such
obligation or liability by virtue of
such Subservicing Agreements or
arrangements or by virtue of indemnification
from the Subservicer and to the same extent
and under the same terms and
conditions as if the Servicer alone were
servicing and administering such
Mortgage Loans. The Servicer shall be
entitled to enter into any agreement
with a Subservicer for indemnification of
the Servicer by such Subservicer and
nothing contained in this Agreement shall
be deemed to limit or modify such
indemnification.
Section 3.05 No Contractual Relationship between Subservicers and
the
Trustee. Any Subservicing Agreement that
may be entered into and any
transactions or services relating to the
Mortgage Loans involving a
Subservicer in its capacity as such shall
be deemed to be between the
Subservicer and the Servicer alone, and the
Trustee (or any successor
Servicer) shall not be deemed a party
thereto and shall have no claims,
rights, obligations, duties or liabilities
with respect to the Subservicer
except as set forth in Section 3.06. The
Servicer shall be solely liable for
all fees owed by it to any Subservicer,
irrespective of whether the Servicer's
compensation pursuant to this Agreement is
sufficient to pay such fees.
Section 3.06 Assumption or Termination of Subservicing Agreements
by
Trustee. In the event the Servicer at any
time shall for any reason no longer
be the Servicer (including by reason of the
occurrence of an Event of
Default), the Trustee, or its designee, or
the successor Servicer if the
successor Servicer is not the Trustee,
shall thereupon assume all of the
rights and obligations of the Servicer
under each Subservicing Agreement that
the Servicer may have entered into, with
copies thereof provided to the
Trustee prior to the Trustee assuming such
rights and obligations, unless the
Trustee elects to terminate any
Subservicing Agreement in accordance with its
terms as provided in Section 3.03.
Upon such assumption, the Trustee, its designee or the
successor
servicer shall be deemed, subject to
Section 3.03, to have assumed all of the
Servicer's interest therein and to have
replaced the Servicer as a party to
each Subservicing Agreement to the same
extent as if each Subservicing
Agreement had been assigned to the assuming
party, except that (i) the
Servicer shall not thereby be relieved of
any liability or obligations under
any Subservicing Agreement that arose
before it ceased to be the Servicer and
(ii) none of the Depositor, the Trustee,
their designees or any successor
Servicer shall be deemed to have assumed
any liability or obligation of the
Servicer that arose before it ceased to be
the Servicer.
The Servicer at its expense shall, upon request of the Trustee,
deliver to the assuming party all documents
and records relating to each
Subservicing Agreement and the Mortgage
Loans then being serviced and an
accounting of amounts collected and held by
or on behalf of it, and otherwise
use its best efforts to effect the orderly
and efficient transfer of the
Subservicing Agreements to the assuming
party.
Section 3.07 Collection of Certain Mortgage Loan Payments. (a)
The
Servicer shall make reasonable efforts to
collect all payments called for
under the terms and provisions of
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the Mortgage Loans, and shall, to the
extent such procedures shall be
consistent with this Agreement and the
terms and provisions of any applicable
Insurance Policies, follow such collection
procedures as it would follow with
respect to mortgage loans comparable to the
Mortgage Loans and held for its
own account. Consistent with the foregoing
and Accepted Servicing Practices,
the Servicer may (i) waive any late payment
charge or, if applicable, any
penalty interest, or (ii) extend the due
dates for the Scheduled Payments due
on a Mortgage Note for a period of not
greater than 180 days; provided, that
any extension pursuant to clause (ii) above
shall not affect the amortization
schedule of any Mortgage Loan for purposes
of any computation hereunder,
except as provided below. In the event of
any such arrangement pursuant to
clause (ii) above, the Servicer shall make
timely advances on such Mortgage
Loan during such extension pursuant to
Section 4.01 and in accordance with the
amortization schedule of such Mortgage Loan
without modification thereof by
reason of such arrangements, subject to
Section 4.01(d) pursuant to which the
Servicer shall not be required to make any
such advances that are
Nonrecoverable P&I Advances.
Notwithstanding the foregoing, in the event that
any Mortgage Loan is in default or, in the
judgment of the Servicer, such
default is reasonably foreseeable, the
Servicer, consistent with the standards
set forth in Section 3.01, may also waive,
modify or vary any term of such
Mortgage Loan (including modifications that
would change the Mortgage Interest
Rate, forgive the payment of principal or
interest, extend the final maturity
date of such Mortgage Loan or waive, in
whole or in part, a Prepayment
Premium), accept payment from the related
Mortgagor of an amount less than the
Stated Principal Balance in final
satisfaction of such Mortgage Loan, or
consent to the postponement of strict
compliance with any such term or
otherwise grant indulgence to any Mortgagor
(any and all such waivers,
modifications, variances, forgiveness of
principal or interest, postponements,
or indulgences collectively referred to
herein as "Forbearance"); provided,
however, that the Servicer's approval of a
modification of a Due Date shall
not be considered a modification for
purposes of this sentence; provided,
further, that the final maturity date of
any Mortgage Loan may not be extended
beyond the Final Scheduled Distribution
Date for the Principal Certificates.
The Servicer's analysis supporting any
Forbearance and the conclusion that any
Forbearance meets the standards of Section
3.01 shall be reflected in writing
in the Servicing File or on the Servicer's
servicing records. In addition,
notwithstanding the foregoing, the Servicer
may also waive (or permit a
Subservicer to waive), in whole or in part,
a Prepayment Premium if such
waiver would, in the reasonable judgment of
the Servicer, maximize recovery on
the related Mortgage Loan, or if such
Prepayment Premium is (i) not permitted
to be collected by applicable law or the
collection thereof would be
considered "predatory" pursuant to written
guidance published by any
applicable federal, state or local
regulatory authority having jurisdiction
over such matters, or (ii) the
enforceability thereof is limited (1) by
bankruptcy, insolvency, moratorium,
receivership or other similar laws
relating to creditor's rights or (2) due to
acceleration in connection with a
foreclosure or other involuntary payment.
If a Prepayment Premium is waived
other than as permitted in this Section
3.07(a), then the Servicer is required
to pay the amount of such waived Prepayment
Premium, for the benefit of the
Holders of the Class P Certificates, by
depositing such amount into the
Collection Account together with and at the
time that the amount prepaid on
the related Mortgage Loan is required to be
deposited into the Collection
Account; provided, however, that the
Servicer shall not have an obligation to
pay the amount of any uncollected
Prepayment Premium if the failure to collect
such amount is in the direct result of
inaccurate or incomplete information on
the Mortgage Loan Schedule in effect at
such time.
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(b) The Servicer shall give notice to the Trustee, each Rating
Agency
and the Depositor of any proposed change of
the location of the Collection
Account within a reasonable period of time
prior to any change thereof.
Section 3.08 Subservicing Accounts. In those cases where a
Subservicer is servicing a Mortgage Loan
pursuant to a Subservicing Agreement,
the Subservicer will be required to
establish and maintain one or more
accounts (collectively, the "Subservicing
Account"). The Subservicing Account
shall be an Eligible Account and shall
otherwise be acceptable to the
Servicer. The Subservicer shall deposit in
the clearing account (which account
must be an Eligible Account) in which it
customarily deposits payments and
collections on mortgage loans in connection
with its mortgage loan servicing
activities on a daily basis, and in no
event more than one Business Day after
the Subservicer's receipt thereof, all
proceeds of Mortgage Loans received by
the Subservicer less its servicing
compensation to the extent permitted by the
Subservicing Agreement, and shall
thereafter deposit such amounts in the
Subservicing Account, in no event more than
two Business Days after the
deposit of such funds into the clearing
account. The Subservicer shall
thereafter deposit such proceeds in the
Collection Account or remit such
proceeds to the Servicer for deposit in the
Collection Account not later than
two Business Days after the deposit of such
amounts in the Subservicing
Account. For purposes of this Agreement,
the Servicer shall be deemed to have
received payments on the Mortgage Loans
when the Subservicer receives such
payments.
Section 3.09 Collection of Taxes, Assessments and Similar
Items;
Escrow Accounts. (a) The Servicer shall
ensure that each of the Mortgage Loans
shall be covered by a paid in full,
life-of-the-loan tax service contract in
effect with respect to each Mortgage Loan
(each, a "Tax Service Contract");
provided, that the Responsible Party
transferred a Tax Service Contract to the
Servicer. Each Tax Service Contract shall
be assigned to the Trustee, or its
designee, at the Servicer's expense in the
event that the Servicer is
terminated as Servicer of the related
Mortgage Loan.
(b) To the extent that the services described in this paragraph
(b)
are not otherwise provided pursuant to the
Tax Service Contracts described in
paragraph (a) hereof, the Servicer
undertakes to perform such functions. To
the extent the related Mortgage Loan
provides for Escrow Payments, the
Servicer shall establish and maintain, or
cause to be established and
maintained, one or more accounts (the
"Escrow Accounts"), which shall be
Eligible Accounts. The Servicer shall
deposit in the clearing account (which
account must be an Eligible Account) in
which it customarily deposits payments
and collections on mortgage loans in
connection with its mortgage loan
servicing activities on a daily basis, and
in no event more than one Business
Day after the Servicer's receipt thereof,
all collections from the Mortgagors
(or related advances from Subservicers) for
the payment of taxes, assessments,
hazard insurance premiums and comparable
items for the account of the
Mortgagors ("Escrow Payments") collected on
account of the Mortgage Loans and
shall thereafter deposit such Escrow
Payments in the Escrow Accounts, in no
event more than two Business Days after the
deposit of such funds in the
clearing account, for the purpose of
effecting the payment of any such items
as required under the terms of this
Agreement. Withdrawals of amounts from an
Escrow Account may be made only to (i)
effect payment of taxes, assessments,
fire and hazard insurance premiums,
condominium charges and comparable items;
(ii) reimburse the Servicer (or a
Subservicer to the extent provided in the
related Subservicing Agreement) out of
related collections for any
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advances made pursuant to Section 3.01
(with respect to taxes and assessments)
and Section 3.13 (with respect to hazard
insurance); (iii) refund to
Mortgagors any sums as may be determined to
be overages; (iv) apply to the
restoration or repair of the Mortgaged
Property in accordance with the Section
3.13; (v) transfer to the Collection
Account an application to reduce the
principal balance of the Mortgage Loan in
accordance with the terms of the
related Mortgage and Mortgage Note; (vi)
pay interest to the Servicer and, if
required and as described below, to
Mortgagors on balances in the Escrow
Account; (vii) clear and terminate the
Escrow Account at the termination of
the Servicer's obligations and
responsibilities in respect of the Mortgage
Loans under this Agreement; or (viii)
recover amounts deposited in error or
for which amounts previously deposited are
returned due to a "not sufficient
funds" or other denial of payment by the
related Mortgagor's banking
institution. As part of its servicing
duties, the Servicer or Subservicers
shall pay to the Mortgagors interest on
funds in Escrow Accounts, to the
extent required by law and, to the extent
that interest earned on funds in the
Escrow Accounts is insufficient, to pay
such interest from its or their own
funds, without any reimbursement therefor.
To the extent that a Mortgage does
not provide for Escrow Payments, the
Servicer shall use commercially
reasonable efforts consistent with Accepted
Servicing Practices to determine
whether any such payments are made by the
Mortgagor in a manner and at a time
that avoids the loss of the Mortgaged
Property due to a tax sale or the
foreclosure as a result of a tax lien. The
Servicer assumes full
responsibility for the payment of all such
bills within such time and shall
effect payments of all such bills
irrespective of the Mortgagor's faithful
performance in the payment of same or the
making of the Escrow Payments and
shall make advances from its own funds to
effect such payments; provided,
however, that such advances are deemed to
be Servicing Advances.
Section 3.10 Collection Account. (a) On behalf of the Trustee,
the
Servicer shall establish and maintain for
the benefit of the
Certificateholders, or cause to be
established and maintained, one or more
Eligible Accounts (such account or
accounts, the "Collection Account"), held
in trust for the benefit of the Trustee. On
behalf of the Trustee, the
Servicer shall deposit or cause to be
deposited in the clearing account (which
account must be an Eligible Account) in
which it customarily deposits payments
and collections on mortgage loans in
connection with its mortgage loan
servicing activities on a daily basis, and
in no event more than one Business
Day after the Servicer's receipt thereof,
and shall thereafter deposit in the
Collection Account, in no event more than
two Business Days after the deposit
of such funds into the clearing account, as
and when received or as otherwise
required hereunder, the following payments
and collections received or made by
it subsequent to the Cut-off Date (other
than in respect of principal or
interest on the related Mortgage Loans due
on or before the Cut-off Date), or
payments (other than Principal Prepayments)
received by it on or prior to the
Cut-off Date but allocable to a Due Period
subsequent thereto:
(i) all payments on account of principal, including Principal
Prepayments, on
the Mortgage Loans;
(ii) all payments on account of interest (net of the related
Servicing Fee)
on each Mortgage Loan;
(iii) all Insurance Proceeds and Condemnation Proceeds to the
extent
such Insurance
Proceeds and Condemnation Proceeds are not to be applied
to the
restoration
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of the related
Mortgaged Property or released to the related Mortgagor in
accordance with
the express requirements of law or in accordance with
prudent and
customary servicing practices and Liquidation Proceeds;
(iv) any amounts required to be deposited pursuant to Section 3.12
in
connection with
any losses realized on Permitted Investments with respect
to funds held in
the Collection Account;
(v) any amounts required to be deposited by the Servicer pursuant
to
the second
paragraph of Section 3.13(a) in respect of any blanket policy
deductibles;
(vi) all proceeds of any Mortgage Loan repurchased or purchased
in
accordance with
this Agreement; and
(vii) all Prepayment Premiums collected by the Servicer.
The foregoing requirements for deposit in the Collection
Account
shall be exclusive, it being understood and
agreed that, without limiting the
generality of the foregoing, payments in
the nature of late payment charges,
NSF fees, reconveyance fees, assumption
fees and other similar fees and
charges need not be deposited by the
Servicer in the Collection Account and
shall, upon collection, belong to the
Servicer as additional compensation for
its servicing activities. In the event the
Servicer shall deposit in the
Collection Account any amount not required
to be deposited therein, it may at
any time withdraw such amount from the
Collection Account, any provision
herein to the contrary notwithstanding.
(b) Funds in the Collection Account may be invested in
Permitted
Investments in accordance with the
provisions set forth in Section 3.12. The
Servicer shall give notice to the Trustee
and the Depositor of the location of
the Collection Account maintained by it
when established and prior to any
change thereof.
Section 3.11 Withdrawals from the Collection Account. (a) The
Servicer shall, from time to time, make
withdrawals from the Collection
Account for any of the following purposes
or as described in Section 4.01:
(i) on or prior to the Remittance Date, to remit to the Trustee
(A)
the Trustee Fee
with respect to such Distribution Date and (B) all
Available Funds
in respect of the related Distribution Date together with
all amounts
representing Prepayment Premiums from the Mortgage Loans
received during
the related Prepayment Period;
(ii) to reimburse the Servicer for P&I Advances, but only to
the
extent of
amounts received which represent Late Collections (net of the
related
Servicing Fees) of Scheduled Payments on Mortgage Loans with
respect to which
such P&I Advances were made in accordance with the
provisions of
Section 4.01;
(iii) to pay the
Servicer or any Subservicer (A) any unpaid Servicing
Fees or (B) any
unreimbursed Servicing Advances with respect to each
Mortgage Loan,
but only to the extent of any Late Collections,
Liquidation
Proceeds, Condemnation Proceeds, Insurance Proceeds or other
amounts as may
be collected by the Servicer from a
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Mortgagor, or
otherwise received with respect to such Mortgage Loan (or
the related REO
Property);
(iv)
to pay to the Servicer as servicing compensation (in addition
to
the Servicing
Fee) on the Remittance Date any interest or investment
income earned on
funds deposited in the Collection Account;
(v) to pay to the Responsible Party, with respect to each
Mortgage
Loan that has
previously been repurchased pursuant to this Agreement all
amounts received
thereon subsequent to the date of purchase;
(vi) to reimburse the Servicer for (A) any P&I Advance or
Servicing
Advance
previously made which the Servicer has determined to be a
Nonrecoverable
P&I Advance or Nonrecoverable Servicing Advance in
accordance with
the provisions of Section 4.01 and (B) any unpaid
Servicing Fees
to the extent not recoverable from Liquidation Proceeds,
Insurance
Proceeds or other amounts received with respect to the related
Mortgage Loan
under Section 3.11(a)(iii);
(vii) to pay, or to reimburse the Servicer for advances in
respect
of, expenses
incurred in connection with any Mortgage Loan pursuant to
Section
3.15;
(viii) to reimburse the Servicer, the Depositor or the Trustee
for
expenses
incurred by or reimbursable to the Servicer, the Depositor or
the Trustee, as
the case may be, pursuant to Section 6.03, Section 7.02
or Section
8.05;
(ix) to reimburse the Servicer or the Trustee, as the case may
be,
for expenses
reasonably incurred in respect of the breach or defect
giving rise to
the repurchase obligation under Section 2.03 of this
Agreement that
were included in the Repurchase Price of the Mortgage
Loan, including
any expenses arising out of the enforcement of the
repurchase
obligation, to the extent not otherwise paid pursuant to the
terms
hereof;
(x) to withdraw any amounts deposited in the Collection Account
in
error or for
which amounts previously deposited are returned due to a
"not sufficient
funds" or other denial of payment by the related
Mortgagor's
banking institution;
(xi) to withdraw any amounts held in the Collection Account and
not
required to be
remitted to the Trustee on the Remittance Date occurring
in the month in
which such amounts are deposited into the Collection
Account, to
reimburse the Servicer for unreimbursed P&I Advances;
(xii) to invest funds in Permitted Investments in accordance
with
Section 3.12;
and
(xiii) to clear and terminate the Collection Account upon
termination
of this Agreement.
(xiv) to the extent that the Servicer does not timely make the
remittance
referred to in clause (i) above, the Servicer shall pay the
Trustee for the
account of the Trustee
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interest on any
amount not timely remitted at the prime rate, from and
including the
applicable Remittance Date to but excluding the date such
remittance is
actually made.
(b) The Servicer shall keep and maintain separate accounting, on
a
Mortgage Loan by Mortgage Loan basis, for
the purpose of justifying any
withdrawal from the Collection Account, to
the extent held by or on behalf of
it, pursuant to subclauses (a)(ii), (iii),
(iv), (v), (vi), (vii), (viii) and
(ix) above. The Servicer shall provide
written notification to the Depositor,
on or prior to the next succeeding
Remittance Date, upon making any
withdrawals from the Collection Account
pursuant to subclause (a)(vi) above.
Section 3.12 Investment of Funds in the Collection Account and
the
Distribution Account. (a) The Servicer may
invest the funds in the Collection
Account and the Trustee may invest funds in
the Distribution Account during
the Trustee Float Period, and shall (except
during the Trustee Float Period),
invest such funds in the Distribution
Account at the direction of the
Depositor (for purposes of this Section
3.12, each of the Collection Account
and Distribution Account are referred to as
an "Investment Account"), in one
or more Permitted Investments bearing
interest or sold at a discount, and
maturing, unless payable on demand no later
than the Business Day on which
such funds are required to be withdrawn
from such account pursuant to this
Agreement (except for investments made at
the Depositor's direction, which
shall mature no later than the Business Day
immediately preceding the date of
the required withdrawal). All such
Permitted Investments shall be held to
maturity, unless payable on demand. Any
investment of funds in an Investment
Account shall be made in the name of the
Trustee. The Trustee shall be
entitled to sole possession (except with
respect to investment direction of
funds held in the related Account and any
income and gain realized thereon in
any Account other than the Distribution
Account during the Trustee Float
Period) over each such investment, and any
certificate or other instrument
evidencing any such investment shall be
delivered directly to the Trustee or
its agent, together with any document of
transfer necessary to transfer title
to such investment to the Trustee. In the
event amounts on deposit in an
Investment Account are at any time invested
in a Permitted Investment payable
on demand, the Trustee may:
(x) consistent
with any notice required to be given thereunder,
demand that payment thereon be made on the last day such
Permitted Investment may otherwise mature hereunder in an
amount equal to the lesser of (1) all amounts then payable
thereunder and
(2) the amount required to be withdrawn on
such date; and
(y) demand
payment of all amounts due thereunder that such
Permitted Investment would not constitute a Permitted
Investment in respect
of funds thereafter on deposit in the
Investment Account.
(b) All income and gain realized from the investment of funds
deposited in the Collection Account and
Escrow Account held by or on behalf of
the Servicer, shall be for the benefit of
the Servicer and shall be subject to
its withdrawal in the manner set forth in
Section 3.11. Any other benefit
derived from the Collection Account and
Escrow Account associated with the
receipt, disbursement and accumulation of
principal, interest, taxes, hazard
insurance, mortgage blanket insurance, and
like sources, shall accrue to the
benefit of the Servicer, except that the
Servicer shall not realize any
economic benefit from any forced charging
of services.
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The Servicer shall deposit in the
Collection Account and the Escrow Account
the amount of any loss of principal
incurred in respect of any such Permitted
Investment made with funds in such accounts
immediately upon realization of
such loss.
(c) All income and gain realized from the investment of funds
deposited in the Distribution Account held
by the Trustee, shall be for the
benefit of the Depositor (except for any
income or gain realized from the
investment of funds on deposit in the
Distribution Account during the Trustee
Float Period, which shall be for the
benefit of the Trustee). The Depositor
shall deposit in the Distribution Account
(except with respect to the Trustee
Float Period, in which case the Trustee
shall so deposit) the amount of any
loss of principal incurred in respect of
any such Permitted Investment made
with funds in such accounts immediately
upon realization of such loss.
(d) Except as otherwise expressly provided in this Agreement, if
any
default occurs in the making of a payment
due under any Permitted Investment,
or if a default occurs in any other
performance required under any Permitted
Investment, the Trustee shall take such
action as may be appropriate to
enforce such payment or performance,
including the institution and prosecution
of appropriate proceedings.
(e) The Trustee or its Affiliates are permitted to receive
additional
compensation that could be deemed to be in
the Trustee's economic self
interest for (i) serving as investment
adviser, administrator, shareholder,
servicing agent, custodian or sub custodian
with respect to certain of the
Permitted Investments, (ii) using
Affiliates to effect transactions in certain
Permitted Investments and (iii) effecting
transactions in certain Permitted
Investments.
(f) The Trustee shall not be liable for the amount of any loss
incurred with respect of any investment
(except that during the Trustee Float
Period, it will be responsible for
reimbursing the Trust for such loss) or
lack of investment of funds held in any
Investment Account or the Distribution
Account if made in accordance with this
Section 3.12.
Section 3.13 Maintenance of Hazard Insurance, Errors and
Omissions
and Fidelity Coverage. (a) The Servicer
shall cause to be maintained for each
Mortgage Loan fire insurance with extended
coverage on the related Mortgaged
Property in an amount which is at least
equal to the least of (i) the
outstanding principal balance of such
Mortgage Loan, (ii) the amount necessary
to fully compensate for any damage or loss
to the improvements that are a part
of such property on a replacement cost
basis, (iii) the maximum insurable
value of the improvements which are a part
of such Mortgaged Property and (iv)
the amount determined by applicable federal
or state law, in each case in an
amount not less than such amount as is
necessary to avoid the application of
any coinsurance clause contained in the
related hazard insurance policy. The
Servicer shall also cause to be maintained
fire insurance with extended
coverage on each REO Property in an amount
which is at least equal to the
lesser of (i) the maximum insurable value
of the improvements which are a part
of such property and (ii) the outstanding
principal balance of the related
Mortgage Loan at the time it became an REO
Property, plus accrued interest at
the Mortgage Interest Rate and related
Servicing Advances. The Servicer will
comply in the performance of this Agreement
with all reasonable rules and
requirements of each insurer under any such
hazard policies. Any amounts to be
collected by the Servicer under any such
policies (other than amounts to be
applied to the restoration or repair of
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the property subject to the related
Mortgage or amounts to be released to the
Mortgagor in accordance with the procedures
that the Servicer would follow in
servicing loans held for its own account,
subject to the terms and conditions
of the related Mortgage and Mortgage Note)
shall be deposited in the
Collection Account, subject to withdrawal
pursuant to Section 3.11. If the
Mortgagor fails to provide Mortgage Loan
hazard insurance coverage after
thirty (30) days of Servicer's written
notification, the Servicer shall put in
place such hazard insurance coverage on the
Mortgagor's behalf. Any out of
pocket expense or advance made by the
Servicer on such force placed hazard
insurance coverage shall be deemed a
Servicing Advance. Any cost incurred by
the Servicer in maintaining any such
insurance shall not, for the purpose of
calculating distributions to the Trustee,
be added to the unpaid principal
balance of the related Mortgage Loan,
notwithstanding that the terms of such
Mortgage Loan so permit. It is understood
and agreed that no earthquake or
other additional insurance is to be
required of any Mortgagor other than
pursuant to such applicable laws and
regulations as shall at any time be in
force and as shall require such additional
insurance. If the Mortgaged
Property or REO Property is at any time in
an area identified in the Federal
Register by the Federal Emergency
Management Agency as having special flood
hazards and flood insurance has been made
available, the Servicer will cause
to be maintained a flood insurance policy
in respect thereof. Such flood
insurance shall be in an amount equal to
the lesser of (i) the minimum amount
required, under the terms of coverage, to
compensate for any damage or loss on
a replacement cost basis (or the unpaid
principal balance of the related
Mortgage Loan if replacement cost coverage
is not available for the type of
building insured) and (ii) the maximum
amount of insurance which is available
under the Flood Disaster Protection Act of
1973, as amended. If at any time
during the term of the Mortgage Loan, the
Servicer determines in accordance
with applicable law and pursuant to the
Federal Emergency Management Agency
Guides that a Mortgaged Property is located
in a special flood hazard area and
is not covered by flood insurance or is
covered in an amount less than the
amount required by the Flood Disaster
Protection Act of 1973, as amended, the
Servicer shall notify the related Mortgagor
to obtain such flood insurance
coverage, and if said Mortgagor fails to
obtain the required flood insurance
coverage within forty five (45) days after
such notification, the Servicer
shall immediately force place the required
flood insurance on the Mortgagor's
behalf. Any out of pocket expense or
advance made by the Servicer on such
force placed flood insurance coverage shall
be deemed a Servicing Advance.
In the event that the Servicer shall obtain and maintain a
blanket
policy with an insurer either (i)
acceptable to Fannie Mae or Freddie Mac, or
(ii) having a General Policy Rating of B:VI
or better in Best's (or such other
rating that is comparable to such rating)
insuring against hazard losses on
all of the Mortgage Loans, it shall
conclusively be deemed to have satisfied
its obligations as set forth in the first
two sentences of this Section 3.13,
it being understood and agreed that such
policy may contain a deductible
clause, in which case the Servicer shall,
in the event that there shall not
have been maintained on the related
Mortgaged Property or REO Property a
policy complying with the first two
sentences of this Section 3.13, and there
shall have been one or more losses which
would have been covered by such
policy, deposit to the Collection Account
from its own funds the amount not
otherwise payable under the blanket policy
because of such deductible clause.
In connection with its activities as
administrator and servicer of the
Mortgage Loans, the Servicer agrees to
prepare and present, on behalf of
itself, the Trustee claims under any such
blanket policy in a timely fashion
in accordance with the terms of such
policy.
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(b) The Servicer shall keep in force during the term of this
Agreement a policy or policies of insurance
covering errors and omissions for
failure in the performance of the
Servicer's obligations under this Agreement,
which policy or policies shall be in such
form and amount that would meet the
requirements of Fannie Mae or Freddie Mac
if it were the purchaser of the
Mortgage Loans, unless the Servicer has
obtained a waiver of such requirements
from Fannie Mae or Freddie Mac. The
Servicer shall also maintain a fidelity
bond in the form and amount that would meet
the requirements of Fannie Mae or
Freddie Mac, unless the Servicer has
obtained a waiver of such requirements
from Fannie Mae or Freddie Mac. The
Servicer shall provide the Trustee upon
request with copies of any such insurance
policies and fidelity bond. The
Servicer shall be deemed to have complied
with this provision if an Affiliate
of the Servicer has such errors and
omissions and fidelity bond coverage and,
by the terms of such insurance policy or
fidelity bond, the coverage afforded
thereunder extends to the Servicer. Any
such errors and omissions policy and
fidelity bond shall by its terms not be
cancelable without thirty days' prior
written notice to the Trustee. The Servicer
shall also cause each Subservicer
to maintain a policy of insurance covering
errors and omissions and a fidelity
bond which would meet such
requirements.
Section 3.14 Enforcement of Due on Sale Clauses; Assumption
Agreements. The Servicer will, to the
extent it has knowledge of any
conveyance or prospective conveyance of any
Mortgaged Property by any
Mortgagor (whether by absolute conveyance
or by contract of sale, and whether
or not the Mortgagor remains or is to
remain liable under the Mortgage Note
and/or the Mortgage), exercise its rights
to accelerate the maturity of such
Mortgage Loan under the "due on sale"
clause, if any, applicable thereto;
provided, however, that the Servicer shall
not be required to take such action
if, in its sole business judgment, the
Servicer believes it is not in the best
interests of the Trust Fund and shall not
exercise any such rights if
prohibited by law from doing so. If the
Servicer reasonably believes it is
unable under applicable law to enforce such
"due-on-sale" clause or if any of
the other conditions set forth in the
proviso to the preceding sentence apply,
the Servicer will enter into an assumption
and modification agreement from or
with the person to whom such property has
been conveyed or is proposed to be
conveyed, pursuant to which such person
becomes liable under the Mortgage
Note, if any, and, to the extent permitted
by applicable state law, the
Mortgagor remains liable thereon. The
Servicer is also authorized to enter
into a substitution of liability agreement
with such person, pursuant to which
the original Mortgagor is released from
liability and such person is
substituted as the Mortgagor and becomes
liable under the Mortgage Note;
provided, that no such substitution shall
be effective unless such person
satisfies the underwriting criteria of the
Servicer and such substitution is
in the best interest of the
Certificateholders as determined by the Servicer.
In connection with any assumption,
modification or substitution, the Servicer
shall apply such underwriting standards and
follow such practices and
procedures as shall be normal and usual in
its general mortgage servicing
activities and as it applies to other
mortgage loans owned solely by it. The
Servicer shall not take or enter into any
assumption and modification
agreement, however, unless (to the extent
practicable in the circumstances) it
shall have received confirmation, in
writing, of the continued effectiveness
of any applicable hazard insurance policy,
or a new policy meeting the
requirements of this Section is obtained.
Any fee collected by the Servicer in
respect of an assumption or substitution of
liability agreement will be
retained by the Servicer as additional
servicing compensation. In connection
with any such assumption, no material term
of the Mortgage Note (including but
not limited to the related Mortgage
Interest Rate and the amount of the
Scheduled Payment) may be amended or
modified, except as
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otherwise required pursuant to the terms
thereof. The Servicer shall notify
the Trustee that any such substitution,
modification or assumption agreement
has been completed by forwarding to the
Trustee the executed original of such
substitution or assumption agreement, which
document shall be added to the
related Mortgage File and shall, for all
purposes, be considered a part of
such Mortgage File to the same extent as
all other documents and instruments
constituting a part thereof.
Notwithstanding the foregoing paragraph or any other provision
of
this Agreement, the Servicer shall not be
deemed to be in default, breach or
any other violation of its obligations
hereunder by reason of any assumption
of a Mortgage Loan by operation of law or
by the terms of the Mortgage Note or
any assumption which the Servicer may be
restricted by law from preventing,
for any reason whatsoever. For purposes of
this Section 3.14, the term
"assumption" is deemed to also include a
sale (of the Mortgaged Property)
subject to the Mortgage that is not
accompanied by an assumption or
substitution of liability agreement.
Section 3.15 Realization upon Defaulted Mortgage Loans. The
Servicer
shall use its best efforts, consistent with
Accepted Servicing Practices, to
foreclose upon or otherwise comparably
convert (which may include an
acquisition of REO Property) the ownership
of properties securing such of the
Mortgage Loans as come into and continue in
default and as to which no
satisfactory arrangements can be made for
collection of delinquent payments
pursuant to Section 3.07, and which are not
released from this Agreement
pursuant to any other provision hereof. The
Servicer shall use reasonable
efforts to realize upon such defaulted
Mortgage Loans in such manner as will
maximize the receipt of principal and
interest by the Trustee, taking into
account, among other things, the timing of
foreclosure proceedings. The
foregoing is subject to the provisions
that, in any case in which a Mortgaged
Property shall have suffered damage from an
uninsured cause, the Servicer
shall not be required to expend its own
funds toward the restoration of such
property unless it shall determine in its
sole discretion (i) that such
restoration will increase the net proceeds
of liquidation of the related
Mortgage Loan to the Trustee, after
reimbursement to itself for such expenses,
and (ii) that such expenses will be
recoverable by the Servicer through
Insurance Proceeds, Condemnation Proceeds
or Liquidation Proceeds from the
related Mortgaged Property, as contemplated
in Section 3.11. The Servicer
shall be responsible for all other costs
and expenses incurred by it in any
such proceedings; provided, however, that
it shall be entitled to
reimbursement thereof from the related
property, as contemplated in Section
3.11.
The proceeds of any Liquidation Event or REO Disposition, as well
as
any recovery resulting from a partial
collection of Insurance Proceeds,
Condemnation Proceeds or Liquidation
Proceeds or any income from an REO
Property, will be applied in the following
order of priority: first, to
reimburse the Servicer or any Subservicer
for any related unreimbursed
Servicing Advances, pursuant to Section
3.11 or 3.17; second, to reimburse the
Servicer for any related unreimbursed
P&I Advances, pursuant to Section 3.11,
third, to accrued and unpaid interest on
the Mortgage Loan or REO Imputed
Interest, at the Mortgage Interest Rate, to
the date of the liquidation or REO
Disposition, or to the Due Date prior to
the Remittance Date on which such
amounts are to be distributed if not in
connection with a Liquidation Event or
REO Disposition; and fourth, as a recovery
of principal of the Mortgage Loan.
If the amount of the recovery so allocated
to interest is less than a full
recovery thereof, that amount will be
allocated as follows: first, to unpaid
Servicing Fees; and second, as interest at
the Mortgage Interest Rate
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(net of the Servicing Fee Rate). The
portion of the recovery so allocated to
unpaid Servicing Fees shall be reimbursed
to the Servicer or any Subservicer
pursuant to Section 3.11 or 3.17. The
portions of the recovery so allocated to
interest at the Mortgage Interest Rate (net
of the Servicing Fee Rate) and to
principal of the Mortgage Loan shall be
applied as follows: first, to
reimburse the Servicer or any Subservicer
for any related unreimbursed
Servicing Advances in accordance with
Section 3.11 or 3.17, and second, to the
Trustee in accordance with the provisions
of Section 4.02, subject to the last
paragraph of Section 3.17 with respect to
certain excess recoveries from an
REO Disposition.
Notwithstanding anything to the contrary contained herein, in
connection with a foreclosure or acceptance
of a deed in lieu of foreclosure,
in the event the Servicer has received
actual notice of, or has actual
knowledge of the presence of, hazardous or
toxic substances or wastes on the
related Mortgaged Property, or if the
Trustee otherwise requests, the Servicer
shall cause an environmental inspection or
review of such Mortgaged Property
to be conducted by a qualified inspector.
Upon completion of the inspection,
the Servicer shall promptly provide the
Trustee and the Depositor with a
written report of the environmental
inspection.
After reviewing the environmental inspection report, the
Servicer
shall determine consistent with Accepted
Servicing Practices, to proceed with
respect to the Mortgaged Property. In the
event (a) the environmental
inspection report indicates that the
Mortgaged Property is contaminated by
hazardous or toxic substances or wastes and
(b) the Servicer determines,
consistent with Accepted Servicing
Practices, to proceed with foreclosure or
acceptance of a deed in lieu of
foreclosure, the Servicer shall be reimbursed
for all reasonable costs associated with
such foreclosure or acceptance of a
deed in lieu of foreclosure and any related
environmental clean up costs, as
applicable, from the related Liquidation
Proceeds, or if the Liquidation
Proceeds are insufficient to fully
reimburse the Servicer, the Servicer shall
be entitled to be reimbursed from amounts
in the Collection Account pursuant
to Section 3.11. In the event the Servicer
determines not to proceed with
foreclosure or acceptance of a deed in lieu
of foreclosure, the Servicer shall
be reimbursed from general collections for
all Servicing Advances made with
respect to the related Mortgaged Property
from the Collection Account pursuant
to Section 3.11. The Trustee shall not be
responsible for any determination
made by the Servicer pursuant to this
paragraph or otherwise.
Section 3.16 Release of Mortgage Files. (a) Upon the payment in
full
of any Mortgage Loan, or the receipt by the
Servicer of a notification that
payment in full shall be escrowed in a
manner customary for such purposes, the
Servicer will, within five (5) Business
Days of the payment in full, notify
the Trustee by a certification (which
certification shall include a statement
to the effect that all amounts received or
to be received in connection with
such payment which are required to be
deposited in the Collection Account
pursuant to Section 3.10 have been or will
be so deposited) of a Servicing
Officer and shall request delivery to it of
the Custodial File by completing a
Request for Release. Upon receipt of such
certification and a Request for
Release, the Trustee shall promptly release
the related Custodial File to the
Servicer within three (3) Business Days. No
expenses incurred in connection
with any instrument of satisfaction or deed
of reconveyance shall be
chargeable to the Collection Account.
(b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan,
including, for this purpose, collection
under any Insurance Policy relating to
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the Mortgage Loans, the Trustee shall, upon
request of the Servicer and
delivery to the Trustee, of a Request for
Release, release the related
Custodial File to the Servicer, and the
Trustee shall, at the direction of the
Servicer, execute such documents provided
to it as shall be necessary to the
prosecution of any such proceedings and the
Servicer shall retain the Mortgage
File in trust for the benefit of the
Trustee. Such Request for Release shall
obligate the Servicer to return each and
every document previously requested
from the Custodial File to the Trustee when
the need therefor by the Servicer
no longer exists, unless the Mortgage Loan
has been liquidated and the
Liquidation Proceeds relating to the
Mortgage Loan have been deposited in the
Collection Account or the Mortgage File or
such document has been delivered to
an attorney, or to a public trustee or
other public official as required by
law, for purposes of initiating or pursuing
legal action or other proceedings
for the foreclosure of the Mortgaged
Property either judicially or non
judicially, and the Servicer has delivered
to the Trustee a certificate of a
Servicing Officer certifying as to the name
and address of the Person to which
such Mortgage File or such document was
delivered and the purpose or purposes
of such delivery. Upon receipt of a
certificate of a Servicing Officer stating
that such Mortgage Loan was liquidated and
that all amounts received or to be
received in connection with such
liquidation that are required to be deposited
into the related Collection Account have
been so deposited, or that such
Mortgage Loan has become an REO Property, a
copy of the Request for Release
shall be released by the Trustee to the
Servicer or its designee. Upon receipt
of a Request for Release under this Section
3.16, the Trustee shall deliver
the related Custodial File to the Servicer
by regular mail, unless the
Servicer requests that the Trustee deliver
such Custodial File to the Servicer
by overnight courier (in which case such
delivery shall be at the Servicer's
expense); provided, however, that in the
event the Servi
