NOMURA ASSET ACCEPTANCE CORPORATION, Depositor NOMURA CREDIT & CAPITAL, INC., Sponsor GMAC MORTGAGE CORPORATION, a Servicer WELLS FARGO BANK, NATIONAL ASSOCIATION, Master Servicer and Securities Administrator and HSBC BANK USA, NATIONAL ASSOCIATION...
NOMURA
ASSET ACCEPTANCE CORPORATION,
Depositor
NOMURA
CREDIT & CAPITAL, INC.,
Sponsor
GMAC
MORTGAGE CORPORATION,
a
Servicer
XXXXX
FARGO BANK, NATIONAL ASSOCIATION,
Master
Servicer and Securities Administrator
and
HSBC
BANK
USA, NATIONAL ASSOCIATION
Trustee
Dated
as
of September 1, 2006
NOMURA
ASSET ACCEPTANCE CORPORATION
MORTGAGE
PASS-THROUGH CERTIFICATES, SERIES 2006-AR3
TABLE
OF CONTENTS
ARTICLE
I
|
|
DEFINITIONS
|
|
Section
1.01
|
Defined
Terms.
|
Section
1.02
|
Allocation
of Certain Interest Shortfalls.
|
ARTICLE
II
|
|
CONVEYANCE
OF TRUST FUND REPRESENTATIONS AND WARRANTIES
|
|
Section
2.01
|
Conveyance
of Trust Fund.
|
Section
2.02
|
Acceptance
of the Mortgage Loans.
|
Section
2.03
|
Representations,
Warranties and Covenants of GMACM and the Sponsor.
|
Section
2.04
|
Representations
and Warranties of the Depositor.
|
Section
2.05
|
Delivery
of Opinion of Counsel in Connection with Substitutions and
Repurchases.
|
Section
2.06
|
Issuance
of the REMIC I Regular Interests.
|
Section
2.07
|
Conveyance
of the REMIC I Regular Interests, REMIC II Regular Interests and
REMIC III
Regular Interest.
|
Section
2.08
|
Issuance
of the Class R Certificates and Class R-X Certificates.
|
Section
2.09
|
Establishment
of Trust.
|
Section
2.10
|
Purpose
and Powers of the Trust.
|
ARTICLE
III
|
|
ADMINISTRATION
AND SERVICING OF THE MORTGAGE LOANS; ACCOUNTS
|
|
Section
3.01
|
GMACM
to act as Servicer of the related Mortgage Loans.
|
Section
3.02
|
Due-on-Sale
Clauses; Assumption Agreements.
|
Section
3.03
|
Subservicers.
|
Section
3.04
|
Documents,
Records and Funds in Possession of a Servicer To Be Held for
Trustee.
|
Section
3.05
|
Maintenance
of Hazard Insurance.
|
Section
3.06
|
Presentment
of Claims and Collection of Proceeds.
|
Section
3.07
|
Maintenance
of Insurance Policies.
|
Section
3.08
|
Reserved.
|
Section
3.09
|
Realization
Upon Defaulted Mortgage Loans; Determination of Excess Liquidation
Proceeds and Realized Losses; Repurchases of Certain Mortgage
Loans.
|
Section
3.10
|
Servicing
Compensation.
|
Section
3.11
|
REO
Property.
|
Section
3.12
|
Liquidation
Reports.
|
Section
3.13
|
Annual
Statement as to Compliance.
|
Section
3.14
|
Assessments
of Compliance and Attestation Reports.
|
Section
3.15
|
Books
and Records.
|
Section
3.16
|
The
Trustee.
|
Section
3.17
|
REMIC-Related
Covenants.
|
Section
3.18
|
Annual
Xxxxxxxx-Xxxxx Certification; Additional Information.
|
Section
3.19
|
Release
of Mortgage Files.
|
Section
3.20
|
Documents,
Records and Funds in Possession of the Servicers to be held for
Trustee.
|
Section
3.21
|
Possession
of Certain Insurance Policies and Documents.
|
Section
3.22
|
[Reserved].
|
Section
3.23
|
[Reserved].
|
Section
3.24
|
Optional
Purchase of Certain Mortgage Loans.
|
Section
3.25
|
Obligations
of the Servicers Under Credit Risk Management
Agreements.
|
Section
3.26
|
Collection
of Mortgage Loan Payments; Custodial Accounts.
|
Section
3.27
|
Permitted
Withdrawals From the Custodial Accounts.
|
Section
3.28
|
Reports
to Master Servicer.
|
Section
3.29
|
Collection
of Taxes; Assessments and Similar Items; Escrow
Accounts.
|
Section
3.30
|
Adjustments
to Mortgage Rate and Scheduled Payment.
|
Section
3.31
|
Distribution
Account.
|
Section
3.32
|
Permitted
Withdrawals and Transfers from the Distribution
Account.
|
Section
3.33
|
Duties
of the Credit Risk Manager; Termination.
|
Section
3.34
|
Limitation
Upon Liability of the Credit Risk Manager.
|
ARTICLE
IV
|
|
ADMINISTRATION
AND MASTER SERVICING OF THE MORTGAGE LOANS
|
|
Section
4.01
|
The
Master Servicer.
|
Section
4.02
|
Monitoring
of Servicers.
|
Section
4.03
|
Fidelity
Bond.
|
Section
4.04
|
Power
to Act; Procedures.
|
Section
4.05
|
Due-on-Sale
Clauses; Assumption Agreements.
|
Section
4.06
|
Documents,
Records and Funds in Possession of Master Servicer To Be Held for
Trustee.
|
Section
4.07
|
Standard
Hazard Insurance and Flood Insurance Policies.
|
Section
4.08
|
Presentment
of Claims and Collection of Proceeds.
|
Section
4.09
|
Maintenance
of the Primary Mortgage Insurance Policies.
|
Section
4.10
|
Trustee
to Retain Possession of Certain Insurance Policies and
Documents.
|
Section
4.11
|
Realization
Upon Defaulted Loans.
|
Section
4.12
|
Compensation
for the Master Servicer.
|
Section
4.13
|
REO
Property.
|
Section
4.14
|
Obligation
of the Master Servicer in Respect of Prepayment Interest
Shortfalls.
|
ARTICLE
V
|
|
ADVANCES
AND DISTRIBUTIONS
|
|
Section
5.01
|
Advances;
Advance Facility.
|
Section
5.02
|
Compensating
Interest Payments.
|
Section
5.03
|
REMIC
Distributions.
|
Section
5.04
|
Reserved.
|
Section
5.05
|
Reserved.
|
Section
5.06
|
Distributions
on the Certificates.
|
Section
5.07
|
Reserved.
|
Section
5.08
|
Reserved.
|
Section
5.09
|
Allocation
of Realized Losses on the Mortgage Loans.
|
Section
5.10
|
Monthly
Statements to Certificateholders.
|
Section
5.11
|
REMIC
Designations and REMIC Allocations.
|
Section
5.12
|
Prepayment
Charges.
|
Section
5.13
|
Class
P Certificate Account.
|
Section
5.14
|
Reserved.
|
Section
5.15
|
Basis
Risk Shortfall Reserve Fund.
|
Section
5.16
|
Supplemental
Interest Trust.
|
Section
5.17
|
Tax
Treatment of Swap Payments and Swap Termination
Payments.
|
Section
5.18
|
Reports
Filed with Securities and Exchange Commission.
|
ARTICLE
VI
|
|
THE
CERTIFICATES
|
|
Section
6.01
|
The
Certificates.
|
Section
6.02
|
Certificate
Register; Registration of Transfer and Exchange of
Certificates.
|
Section
6.03
|
Mutilated,
Destroyed, Lost or Stolen Certificates.
|
Section
6.04
|
Persons
Deemed Owners.
|
Section
6.05
|
Access
to List of Certificateholders’ Names and Addresses.
|
Section
6.06
|
Book-Entry
Certificates.
|
Section
6.07
|
Notices
to Depository.
|
Section
6.08
|
Definitive
Certificates.
|
Section
6.09
|
Maintenance
of Office or Agency.
|
ARTICLE
VII
|
|
THE
DEPOSITOR, THE RELATED SERVICER AND THE
MASTER SERVICER
|
|
Section
7.01
|
Liabilities
of the Depositor, the related Servicer and the Master
Servicer.
|
Section
7.02
|
Merger
or Consolidation of the Depositor, the related Servicer or the Master
Servicer.
|
Section
7.03
|
Indemnification
of the Depositor and Servicing Function Participants.
|
Section
7.04
|
Limitations
on Liability of the Depositor, Securities Administrator, Master Servicer,
related Servicer and Others.
|
Section
7.05
|
The
related Servicer Not to Resign.
|
Section
7.06
|
Termination
of the related Servicer Without Cause; Appointment of Special
Servicer.
|
Section
7.07
|
Limitation
on Resignation of the Master Servicer.
|
Section
7.08
|
Assignment
of Master Servicing.
|
Section
7.09
|
Rights
of the Depositor in Respect of the related Servicer and the Master
Servicer.
|
ARTICLE
VIII
|
|
DEFAULT;
TERMINATION OF A SERVICER AND
MASTER SERVICER
|
|
Section
8.01
|
Events
of Default.
|
Section
8.02
|
Master
Servicer to Act; Appointment of Successor.
|
Section
8.03
|
Notification
to Certificateholders.
|
Section
8.04
|
Waiver
of Servicer Defaults and Master Servicer Defaults.
|
ARTICLE
IX
|
|
CONCERNING
THE TRUSTEE AND SECURITIES ADMINISTRATOR
|
|
Section
9.01
|
Duties
of Trustee and Securities Administrator.
|
Section
9.02
|
Certain
Matters Affecting the Trustee and Securities
Administrator.
|
Section
9.03
|
Trustee
and Securities Administrator not Liable for Certificates or Mortgage
Loans.
|
Section
9.04
|
Trustee
and Securities Administrator May Own Certificates.
|
Section
9.05
|
Fees
and Expenses of Trustee and Securities Administrator.
|
Section
9.06
|
Eligibility
Requirements for Trustee and Securities Administrator.
|
Section
9.07
|
Resignation
and Removal of Trustee and Securities Administrator.
|
Section
9.08
|
Successor
Trustee or Securities Administrator.
|
Section
9.09
|
Merger
or Consolidation of Trustee or Securities
Administrator.
|
Section
9.10
|
Appointment
of Co-Trustee or Separate Trustee.
|
Section
9.11
|
Appointment
of Office or Agency.
|
Section
9.12
|
Representations
and Warranties.
|
Section
9.13
|
Tax
Matters.
|
ARTICLE
X
|
|
TERMINATION
|
|
Section
10.01
|
Termination
Upon Liquidation or Repurchase of all Mortgage Loans.
|
Section
10.02
|
Final
Distribution on the Certificates.
|
Section
10.03
|
Additional
Termination Requirements.
|
ARTICLE
XI
|
|
MISCELLANEOUS
PROVISIONS
|
|
Section
11.01
|
Amendment.
|
Section
11.02
|
Recordation
of Agreement; Counterparts.
|
Section
11.03
|
Governing
Law.
|
Section
11.04
|
Intention
of Parties.
|
Section
11.05
|
Notices.
|
Section
11.06
|
Severability
of Provisions.
|
Section
11.07
|
Assignment.
|
Section
11.08
|
Limitation
on Rights of Certificateholders.
|
Section
11.09
|
Certificates
Nonassessable and Fully Paid.
|
Section
11.10
|
Intention
of the Parties and Interpretation.
|
Section
11.11
|
Reserved.
|
Section
11.12
|
Early
Termination of Swap Agreement.
|
EXHIBITS
Exhibit
A-1
|
Form
of Class A-[1A][1B][2][3A][3B][4A][4B] Certificates
|
Exhibit
A-2
|
Form
of Class M-[1][2][3][4][5] Certificates
|
Exhibit
A-3
|
Form
of Class P Certificates
|
Exhibit
A-4
|
Form
of Class R Certificates and Class R-X Certificates
|
Exhibit
A-5
|
Form
of Class X Certificates
|
Exhibit
B
|
Mortgage
Loan Schedule
|
Exhibit
C
|
Form
of Mortgage Loan Purchase Agreement
|
Exhibit
D
|
Form
of Transfer Affidavit
|
Exhibit
E
|
Form
of Transferor Certificate
|
Exhibit
F
|
Form
of Investment Letter (Non-Rule 144A)
|
Exhibit
G
|
Form
of Rule 144A Investment Letter
|
Exhibit
H
|
Form
of Additional Disclosure Notification
|
Exhibit
I
|
DTC
Letter of Representations
|
Exhibit
J
|
Schedule
of Mortgage Loans with Lost Notes
|
Exhibit
K
|
Appendix
E of the Standard & Poor's Glossary For File Format For LEVELS®
Version 5.7 Revised
|
Exhibit
L
|
Relevant
Servicing Criteria
|
Exhibit
M
|
Form
of Back-Up Certification
|
Exhibit
N
|
Reporting
Responsibility
|
Exhibit
O
|
Interest
Rate Swap Agreement
|
Exhibit
P
|
Assignment,
Assumption and Recognition Agreement
|
Exhibit
Q
|
Prepayment
Charge Schedule
|
Exhibit
X-1
|
Form
of Schedule of Default Loan Data
|
Exhibit
X-2
|
Standard
File Layout - Delinquency Reporting
|
Exhibit
X-3
|
Form
of Schedule of Realized
Losses/Gains
|
POOLING
AND SERVICING AGREEMENT, dated as of September 1, 2006, among NOMURA ASSET
ACCEPTANCE CORPORATION, a Delaware corporation, as depositor (the “Depositor”),
NOMURA CREDIT & CAPITAL, INC., a Delaware corporation, as seller (in such
capacity, the “Sponsor”), XXXXX FARGO BANK, NATIONAL ASSOCIATION, a national
banking association, as master servicer (the “Master Servicer”) and securities
administrator (the “Securities Administrator”), GMAC MORTGAGE CORPORATION, a
Pennsylvania corporation, as a servicer (a “Servicer” or “GMACM”) and HSBC BANK,
USA, NATIONAL ASSOCIATION, a national banking association, not in its individual
capacity, but solely as trustee (the “Trustee”).
PRELIMINARY
STATEMENT
The
Depositor is the owner of the Trust Fund that is hereby conveyed to the Trustee
in return for the Certificates.
REMIC
I
As
provided herein, the Securities Administrator will make an election to treat
the
segregated pool of assets consisting of the Mortgage Loans and certain other
related assets subject to this Agreement (exclusive of the Basis Risk Shortfall
Reserve Fund and, for the avoidance of doubt, the Supplemental Interest Trust
and the Swap Agreement) as a REMIC for federal income tax purposes, and such
segregated pool of assets will be designated as “REMIC I”. The Class R-1
Interest will represent the sole class of “residual interests” in REMIC I for
purposes of the REMIC Provisions.
The
following table irrevocably sets forth the designation, the Uncertificated
REMIC
I Pass-Through Rate, the initial Uncertificated Principal Balance, and for
purposes of satisfying Treasury regulation Section 1.860G-1(a)(4)(iii), the
“latest possible maturity date” for each of the REMIC I Regular Interests. None
of the REMIC I Regular Interests will be certificated.
Designation
|
Initial
Certificate
Principal
Balance
|
Uncertificated
REMIC I
Pass-Through
Rate
|
Assumed
Final
Maturity
Date(1)
|
|
I
|
$
|
3,811,351.38
|
(2)
|
October
25, 2036
|
I-1-A
|
$
|
6,660,105.13
|
(2)
|
October
25, 2036
|
I-1-B
|
$
|
6,660,105.13
|
(2)
|
October
25, 2036
|
I-2-A
|
$
|
13,059,463.07
|
(2)
|
October
25, 2036
|
I-2-B
|
$
|
13,059,463.07
|
(2)
|
October
25, 2036
|
I-3-A
|
$
|
10,781,488.21
|
(2)
|
October
25, 2036
|
I-3-B
|
$
|
10,781,488.21
|
(2)
|
October
25, 2036
|
I-4-A
|
$
|
10,374,702.11
|
(2)
|
October
25, 2036
|
I-4-B
|
$
|
10,374,702.11
|
(2)
|
October
25, 2036
|
I-5-A
|
$
|
9,605,331.95
|
(2)
|
October
25, 2036
|
I-5-B
|
$
|
9,605,331.95
|
(2)
|
October
25, 2036
|
I-6-A
|
$
|
9,222,665.85
|
(2)
|
October
25, 2036
|
I-6-B
|
$
|
9,222,665.85
|
(2)
|
October
25, 2036
|
I-7-A
|
$
|
8,688,944.31
|
(2)
|
October
25, 2036
|
I-7-B
|
$
|
8,688,944.31
|
(2)
|
October
25, 2036
|
I-8-A
|
$
|
8,266,031.13
|
(2)
|
October
25, 2036
|
I-8-B
|
$
|
8,266,031.13
|
(2)
|
October
25, 2036
|
I-9-A
|
$
|
7,863,698.58
|
(2)
|
October
25, 2036
|
I-9-B
|
$
|
7,863,698.58
|
(2)
|
October
25, 2036
|
I-10-A
|
$
|
7,480,945.28
|
(2)
|
October
25, 2036
|
I-10-B
|
$
|
7,480,945.28
|
(2)
|
October
25, 2036
|
I-11-A
|
$
|
7,116,818.57
|
(2)
|
October
25, 2036
|
I-11-B
|
$
|
7,116,818.57
|
(2)
|
October
25, 2036
|
I-12-A
|
$
|
6,770,412.13
|
(2)
|
October
25, 2036
|
I-12-B
|
$
|
6,770,412.13
|
(2)
|
October
25, 2036
|
I-13-A
|
$
|
6,440,863.75
|
(2)
|
October
25, 2036
|
I-13-B
|
$
|
6,440,863.75
|
(2)
|
October
25, 2036
|
I-14-A
|
$
|
6,127,353.14
|
(2)
|
October
25, 2036
|
I-14-B
|
$
|
6,127,353.14
|
(2)
|
October
25, 2036
|
I-15-A
|
$
|
5,829,099.94
|
(2)
|
October
25, 2036
|
I-15-B
|
$
|
5,829,099.94
|
(2)
|
October
25, 2036
|
I-16-A
|
$
|
5,545,361.74
|
(2)
|
October
25, 2036
|
I-16-B
|
$
|
5,545,361.74
|
(2)
|
October
25, 2036
|
I-17-A
|
$
|
5,275,432.27
|
(2)
|
October
25, 2036
|
I-17-B
|
$
|
5,275,432.27
|
(2)
|
October
25, 2036
|
I-18-A
|
$
|
5,018,639.60
|
(2)
|
October
25, 2036
|
I-18-B
|
$
|
5,018,639.60
|
(2)
|
October
25, 2036
|
I-19-A
|
$
|
4,973,035.21
|
(2)
|
October
25, 2036
|
I-19-B
|
$
|
4,973,035.21
|
(2)
|
October
25, 2036
|
I-20-A
|
$
|
4,669,295.76
|
(2)
|
October
25, 2036
|
I-20-B
|
$
|
4,669,295.76
|
(2)
|
October
25, 2036
|
I-21-A
|
$
|
10,832,686.96
|
(2)
|
October
25, 2036
|
I-21-B
|
$
|
10,832,686.96
|
(2)
|
October
25, 2036
|
I-22-A
|
$
|
3,777,846.52
|
(2)
|
October
25, 2036
|
I-22-B
|
$
|
3,777,846.52
|
(2)
|
October
25, 2036
|
I-23-A
|
$
|
3,593,931.06
|
(2)
|
October
25, 2036
|
I-23-B
|
$
|
3,593,931.06
|
(2)
|
October
25, 2036
|
I-24-A
|
$
|
3,418,967.30
|
(2)
|
October
25, 2036
|
I-24-B
|
$
|
3,418,967.30
|
(2)
|
October
25, 2036
|
I-25-A
|
$
|
3,252,519.60
|
(2)
|
October
25, 2036
|
I-25-B
|
$
|
3,252,519.60
|
(2)
|
October
25, 2036
|
I-26-A
|
$
|
3,094,173.53
|
(2)
|
October
25, 2036
|
I-26-B
|
$
|
3,094,173.53
|
(2)
|
October
25, 2036
|
I-27-A
|
$
|
2,943,534.83
|
(2)
|
October
25, 2036
|
I-27-B
|
$
|
2,943,534.83
|
(2)
|
October
25, 2036
|
I-28-A
|
$
|
2,800,228.41
|
(2)
|
October
25, 2036
|
I-28-B
|
$
|
2,800,228.41
|
(2)
|
October
25, 2036
|
I-29-A
|
$
|
2,663,897.44
|
(2)
|
October
25, 2036
|
I-29-B
|
$
|
2,663,897.44
|
(2)
|
October
25, 2036
|
I-30-A
|
$
|
3,990,781.26
|
(2)
|
October
25, 2036
|
I-30-B
|
$
|
3,990,781.26
|
(2)
|
October
25, 2036
|
I-31-A
|
$
|
2,349,786.18
|
(2)
|
October
25, 2036
|
I-31-B
|
$
|
2,349,786.18
|
(2)
|
October
25, 2036
|
I-32-A
|
$
|
2,225,622.15
|
(2)
|
October
25, 2036
|
I-32-B
|
$
|
2,225,622.15
|
(2)
|
October
25, 2036
|
I-33-A
|
$
|
2,866,417.62
|
(2)
|
October
25, 2036
|
I-33-B
|
$
|
2,866,417.62
|
(2)
|
October
25, 2036
|
I-34-A
|
$
|
4,206,621.45
|
(2)
|
October
25, 2036
|
I-34-B
|
$
|
4,206,621.45
|
(2)
|
October
25, 2036
|
I-35-A
|
$
|
1,772,656.09
|
(2)
|
October
25, 2036
|
I-35-B
|
$
|
1,772,656.09
|
(2)
|
October
25, 2036
|
I-36-A
|
$
|
1,686,348.88
|
(2)
|
October
25, 2036
|
I-36-B
|
$
|
1,686,348.88
|
(2)
|
October
25, 2036
|
I-37-A
|
$
|
479,237.78
|
(2)
|
October
25, 2036
|
I-37-B
|
$
|
479,237.78
|
(2)
|
October
25, 2036
|
I-38-A
|
$
|
1,526,133.69
|
(2)
|
October
25, 2036
|
I-38-B
|
$
|
1,526,133.69
|
(2)
|
October
25, 2036
|
I-39-A
|
$
|
1,451,826.71
|
(2)
|
October
25, 2036
|
I-39-B
|
$
|
1,451,826.71
|
(2)
|
October
25, 2036
|
I-40-A
|
$
|
1,381,136.94
|
(2)
|
October
25, 2036
|
I-40-B
|
$
|
1,381,136.94
|
(2)
|
October
25, 2036
|
I-41-A
|
$
|
1,313,888.32
|
(2)
|
October
25, 2036
|
I-41-B
|
$
|
1,313,888.32
|
(2)
|
October
25, 2036
|
I-42-A
|
$
|
1,249,913.35
|
(2)
|
October
25, 2036
|
I-42-B
|
$
|
1,249,913.35
|
(2)
|
October
25, 2036
|
I-43-A
|
$
|
1,189,052.73
|
(2)
|
October
25, 2036
|
I-43-B
|
$
|
1,189,052.73
|
(2)
|
October
25, 2036
|
I-44-A
|
$
|
1,131,154.85
|
(2)
|
October
25, 2036
|
I-44-B
|
$
|
1,131,154.85
|
(2)
|
October
25, 2036
|
I-45-A
|
$
|
1,076,075.54
|
(2)
|
October
25, 2036
|
I-45-B
|
$
|
1,076,075.54
|
(2)
|
October
25, 2036
|
I-46-A
|
$
|
1,023,715.45
|
(2)
|
October
25, 2036
|
I-46-B
|
$
|
1,023,715.45
|
(2)
|
October
25, 2036
|
I-47-A
|
$
|
973,864.85
|
(2)
|
October
25, 2036
|
I-47-B
|
$
|
973,864.85
|
(2)
|
October
25, 2036
|
I-48-A
|
$
|
926,441.20
|
(2)
|
October
25, 2036
|
I-48-B
|
$
|
926,441.20
|
(2)
|
October
25, 2036
|
I-49-A
|
$
|
881,326.37
|
(2)
|
October
25, 2036
|
I-49-B
|
$
|
881,326.37
|
(2)
|
October
25, 2036
|
I-50-A
|
$
|
838,407.98
|
(2)
|
October
25, 2036
|
I-50-B
|
$
|
838,407.98
|
(2)
|
October
25, 2036
|
I-51-A
|
$
|
797,579.12
|
(2)
|
October
25, 2036
|
I-51-B
|
$
|
797,579.12
|
(2)
|
October
25, 2036
|
I-52-A
|
$
|
758,738.06
|
(2)
|
October
25, 2036
|
I-52-B
|
$
|
758,738.06
|
(2)
|
October
25, 2036
|
I-53-A
|
$
|
721,788.06
|
(2)
|
October
25, 2036
|
I-53-B
|
$
|
721,788.06
|
(2)
|
October
25, 2036
|
I-54-A
|
$
|
686,637.08
|
(2)
|
October
25, 2036
|
I-54-B
|
$
|
686,637.08
|
(2)
|
October
25, 2036
|
I-55-A
|
$
|
662,730.08
|
(2)
|
October
25, 2036
|
I-55-B
|
$
|
662,730.08
|
(2)
|
October
25, 2036
|
I-56-A
|
$
|
671,490.40
|
(2)
|
October
25, 2036
|
I-56-B
|
$
|
671,490.40
|
(2)
|
October
25, 2036
|
I-57-A
|
$
|
2,604,151.33
|
(2)
|
October
25, 2036
|
I-57-B
|
$
|
2,604,151.33
|
(2)
|
October
25, 2036
|
I-58-A
|
$
|
6,200,819.85
|
(2)
|
October
25, 2036
|
I-58-B
|
$
|
6,200,819.85
|
(2)
|
October
25, 2036
|
I-59-A
|
$
|
159,423.43
|
(2)
|
October
25, 2036
|
I-59-B
|
$
|
159,423.43
|
(2)
|
October
25, 2036
|
I-60-A
|
$
|
2,257,759.90
|
(2)
|
October
25, 2036
|
I-60-B
|
$
|
2,257,759.90
|
(2)
|
October
25, 2036
|
P
|
$
|
100.00
|
(3)
|
October
25, 2036
|
___________________
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the
Distribution Date in the month following the maturity date for the
Mortgage Loan with the latest maturity date has been designated as
the
“latest possible maturity date” for each REMIC I Regular
Interest.
|
(2)
|
Calculated
in accordance with the definition of “Uncertificated REMIC I Pass-Through
Rate” herein.
|
(3)
|
The
REMIC I Regular Interest LTI-P will not be entitled to distributions
of
interest.
|
REMIC
II
As
provided herein, the Securities Administrator will make an election to treat
the
segregated pool of assets consisting of the REMIC II Regular Interest) for
federal income tax purposes, and such segregated pool of assets will be
designated as “REMIC II.” The R-2 Interest will represent the sole class of
“residual interests” in REMIC II for purposes of the REMIC Provisions. The
following table irrevocably sets forth the designation, the Uncertificated
REMIC
II Pass-Through Rate, the Initial Uncertificated Principal Balance, and for
purposes of satisfying Treasury regulation Section 1.860G-1(a)(4)(iii), the
“latest possible maturity date” for each of the REMIC II Regular Interests. None
of the REMIC II Regular Interests will be certificated.
Designation
|
Initial
Uncertificated
Principal
Balance
|
Uncertificated
REMIC
II
Pass-Through
Rate
|
Assumed
Final Distribution Date(1)
|
|
LT-AA
|
$
|
466,704,764.35
|
(2)
|
October
25, 2036
|
LT-A1A
|
$
|
805,000.00
|
(2)
|
October
25, 2036
|
LT-A1B
|
$
|
89,450.00
|
(2)
|
October
25, 2036
|
LT-A2
|
$
|
2,094,320.00
|
(2)
|
October
25, 2036
|
LT-A3A
|
$
|
510,390.00
|
(2)
|
October
25, 2036
|
LT-A3B
|
$
|
56,710.00
|
(2)
|
October
25, 2036
|
LT-A4A
|
$
|
815,750.00
|
(2)
|
October
25, 2036
|
LT-A4B
|
$
|
90,640.00
|
(2)
|
October
25, 2036
|
LT-M1
|
$
|
114,290.00
|
(2)
|
October
25, 2036
|
LT-M2
|
$
|
54,760.00
|
(2)
|
October
25, 2036
|
LT-M3
|
$
|
42,860.00
|
(2)
|
October
25, 2036
|
LT-M4
|
$
|
23,810.00
|
(2)
|
October
25, 2036
|
LT-M5
|
$
|
26,200.00
|
(2)
|
October
25, 2036
|
LT-ZZ
|
$
|
4,800,407.03
|
(2)
|
October
25, 2036
|
LT-IO
|
$
|
(4)
|
(2)
|
October
25, 2036
|
LTII-P
|
$
|
100.00
|
(3)
|
October
25, 2036
|
___________________
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the Distribution Date in the month following the maturity date for
the
Mortgage Loan with the latest maturity date has been designated as
the
“latest possible maturity date” for each REMIC II Regular
Interest.
|
(2)
|
Calculated
in accordance with the definition of “Uncertificated REMIC II Pass-Through
Rate” herein.
|
(3)
|
The
REMIC II Regular Interest LTII-P will not be entitled to distributions
of
interest.
|
(4)
|
REMIC
II Regular Interest LT-IO will not have an Uncertificated Principal
Balance, but will accrue interest on its Uncertificated Notional
Amount,
as defined herein.
|
REMIC
III
As
provided herein, the Securities Administrator will make an election to treat
the
segregated pool of assets consisting of the REMIC II Regular Interests as a
REMIC for federal income tax purposes, and such segregated pool of assets will
be designated as “REMIC III”. The R-3 Interest will represent the sole class of
“residual interests” in REMIC III for purposes of the REMIC Provisions. The
following table irrevocably sets forth the Class designation, Pass-Through
Rate
and Initial Certificate Principal Balance for each Class of Certificates that
represents one or more of the “regular interests” in REMIC III created
hereunder:
Class
Designation
|
Initial
Certificate
Principal
Balance
|
Pass-Through
Rate
|
Assumed
Final Distribution Date(1)
|
|
Class
A-1A
|
$
|
80,500,00
|
Class
A-1A Pass Through Rate
|
October
25, 2036
|
Class
A-1B
|
$
|
8,945,000
|
Class
A-1B Pass-Through Rate
|
October
25, 2036
|
Class
A-2
|
$
|
209,432,000
|
Class
A-2 Pass Through Rate
|
October
25, 2036
|
Class
A-3A
|
$
|
51,039,000
|
Class
A-3A Pass-Through Rate
|
October
25, 2036
|
Class
A-3B
|
$
|
5,671,000
|
Class
A-3B Pass-Through Rate
|
October
25, 2036
|
Class
A-4A
|
$
|
81,575,000
|
Class
A-4A Pass-Through Rate
|
October
25, 2036
|
Class
A-4B
|
$
|
9,064,000
|
Class
A-4B Pass-Through Rate
|
October
25, 2036
|
Class
M-1
|
$
|
11,429,000
|
Class
M-1 Pass Through Rate
|
October
25, 2036
|
Class
M-2
|
$
|
5,476,000
|
Class
M-2 Pass Through Rate
|
October
25, 2036
|
Class
M-3
|
$
|
4,286,000
|
Class
M-3 Pass Through Rate
|
October
25, 2036
|
Class
M-4
|
$
|
2,381,000
|
Class
M-4 Pass Through Rate
|
October
25, 2036
|
Class
M-5
|
$
|
2,620,000
|
Class
M-5 Pass Through Rate
|
October
25, 2036
|
Class
X Interest(2)
|
$
|
3,811,351.38
|
Class
X Pass Through Rate
|
October
25, 2036
|
Class
P Interest
|
$
|
100.00
|
N/A(3)
|
October
25, 2036
|
Class
IO Interest
|
(4)
|
(5)
|
October
25, 2036
|
___________________
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the Distribution Date in the second month following the maturity
date for
the Mortgage Loan with the latest maturity date has been designated
as the
“latest possible maturity date” for each Class of
Certificates.
|
(2)
|
The
Class X Interest
will not accrue interest on its Certificate Principal Balance, but
will
accrue interest at the Class X Pass-Through Rate on the Certificate
Notional Balance of the Class X Interest
outstanding from time to time which shall equal the aggregate of
the
Uncertificated Principal Balances of the REMIC II Regular Interests
(other
than REMIC II Regular Interest LTII-P).
|
(3)
|
The
Class P Interest
will not be entitled to distributions of interest.
|
(4)
|
For
federal income tax purposes, the Class IO Interest will not have
a
Pass-Through Rate, but will be entitled to 100% of the amounts distributed
on REMIC II Regular Interest LT-IO.
|
(5)
|
For
federal income tax purposes, the Class IO Interest will not have
an
Uncertificated Principal Balance, but will have a notional amount
equal to
the Uncertificated Notional Amount of REMIC II Regular Interest
IO.
|
REMIC
IV
As
provided herein, the Securities Administrator will make an election to treat
the
segregated pool of assets consisting of the Class X Interest Interests as a
REMIC for federal income tax purposes, and such segregated pool of assets will
be designated as “REMIC IV”. The R-4 Interest will represent the sole class of
“residual interests” in REMIC IV for purposes of the REMIC Provisions. The
following table irrevocably sets forth the Class designation, Pass-Through
Rate
and Initial Certificate Principal Balance for each Class of Certificates that
represents one or more of the “regular interests” in REMIC IV created
hereunder:
Class
Designation
|
Initial
Certificate
Principal
Balance
|
Pass-Through
Rate
|
Assumed
Final Distribution Date(1)
|
Class
X
|
$
3,811,351.38
|
(2)
|
October
25, 2036
|
___________________
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the Distribution Date in the second month following the maturity
date for
the Mortgage Loan with the latest maturity date has been designated
as the
“latest possible maturity date” for the Class X
Certificates.
|
(2)
|
The
Class X Certificates will be entitled to 100% of amounts distributed
on
the Class X Interest.
|
REMIC
V
As
provided herein, the Securities Administrator will make an election to treat
the
segregated pool of assets consisting of the Class P Interest Interests as a
REMIC for federal income tax purposes, and such segregated pool of assets will
be designated as “REMIC V”. The R-5 Interest will represent the sole class of
“residual interests” in REMIC V for purposes of the REMIC Provisions. The
following table irrevocably sets forth the Class designation, Pass-Through
Rate
and Initial Certificate Principal Balance for each Class of Certificates that
represents one or more of the “regular interests” in REMIC V created
hereunder:
Class
Designation
|
Initial
Certificate
Principal
Balance
|
Pass-Through
Rate
|
Assumed
Final Distribution Date(1)
|
Class
P
|
$100.00
|
(2)
|
October
25, 2036
|
___________________
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the Distribution Date in the second month following the maturity
date for
the Mortgage Loan with the latest maturity date has been designated
as the
“latest possible maturity date” for the Class P
Certificates.
|
(2)
|
The
Class P Certificates will be entitled to 100% of amounts distributed
on
the Class P Interest.
|
REMIC
VI
As
provided herein, the Securities Administrator will make an election to treat
the
segregated pool of assets consisting of the Class IO Interest as a REMIC for
federal income tax purposes, and such segregated pool of assets will be
designated as “REMIC VI”. The R-6 Interest will represent the sole class of
“residual interests” in REMIC VI for purposes of the REMIC Provisions. The
following table irrevocably sets forth the Class designation, Pass-Through
Rate
and Initial Certificate Principal Balance for each Class of Certificates that
represents one or more of the “regular interests” in REMIC VI created
hereunder:
Class
Designation
|
Initial
Certificate
Notional
Balance
|
Pass-Through
Rate
|
Assumed
Final Distribution Date(1)
|
Swap-IO
|
(2)
|
(3)
|
October
25, 2036
|
___________________
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the Distribution Date in the second month following the maturity
date for
the Mortgage Loan with the latest maturity date has been designated
as the
“latest possible maturity date” for REMIC VI Regular Interest
Swap-IO.
|
(2)
|
REMIC
VI Regular Interest Swap-IO will have not a Certificate Notional
Balance
but will be entitled to 100% of amounts distributed on the Class
IO
Interest.
|
(3)
|
REMIC
VI Regular Interest Swap-IO will be entitled to 100% of amounts
distributed on the Class IO Interest.
|
In
consideration of the mutual agreements herein contained, the Depositor, GMACM,
the Master Servicer, the Securities Administrator, the Sponsor and the Trustee
agree as follows:
ARTICLE
I
DEFINITIONS
Section
1.01 Defined
Terms.
In
addition to those terms defined in Section 1.02, whenever used in this
Agreement, the following words and phrases, unless the context otherwise
requires, shall have the following meanings:
Accepted
Master Servicing Practices:
With
respect to any Mortgage Loan, as applicable, either (x) those customary mortgage
master servicing practices of prudent mortgage servicing institutions that
master service mortgage loans of the same type and quality as such Mortgage
Loan
in the jurisdiction where the related Mortgaged Property is located, to the
extent applicable to the Master Servicer (except in its capacity as successor
to
a Servicer), or (y) as provided in Section 3.01 hereof, but in no event
below the standard set forth in clause (x).
Accepted
Servicing Practices:
As
defined in Section 3.01.
Account:
Either
the Distribution Account or the Custodial Accounts.
Accrual
Period:
With
respect to the Senior Certificates and Mezzanine Certificates and any
Distribution Date, the period commencing on the immediately preceding
Distribution Date (or with respect to the first Accrual Period, the Closing
Date) and ending on the day immediately preceding the related Distribution
Date.
With respect to the Class X Certificates, the calendar month immediately
preceding such Distribution Date. All calculations of interest on the Senior
Certificates and Mezzanine Certificates will be made based on a 360-day year
and
the actual number of days elapsed in the related Accrual Period. All
calculations of interest on the Class X Certificates will be based on a 360-day
year consisting of twelve 30-day months.
Additional
Disclosure Notification:
Has the
meaning set forth in Section 5.18 of this Agreement.
Additional
Form 10-D Disclosure:
Has the
meaning set forth in Section 5.12(a) of this Agreement.
Additional
Form 10-K Disclosure:
Has the
meaning set forth in Section 5.12(d) of this Agreement.
Adjustment
Date:
With
respect to each Mortgage Loan, the first day of the month in which the Mortgage
Rate of such Mortgage Loan changes pursuant to the related Mortgage Note. The
first Adjustment Date following the Cut-Off Date as to each Mortgage Loan is
set
forth in the Loan Schedule.
Advance:
An
advance of delinquent payments of principal or interest in respect of a Mortgage
Loan required to be made by related Servicer or by the Master Servicer pursuant
to Section 5.01 or pursuant to the related Servicing
Agreement.
Advance
Facility:
As
defined in Section 5.01(b)(i).
Advance
Facility Notice:
As
defined in Section 5.01(b)(ii).
Advance
Financing Person:
As
defined in Section 5.01(b)(i).
Advance
Reimbursement Amount:
As
defined in Section 5.01(b)(ii).
Aggregate
Loan Balance:
With
respect to any Distribution Date, the aggregate of the Stated Principal Balances
of the Mortgage Loans as of the last day of the related Due Period.
Agreement:
This
Pooling and Servicing Agreement and any and all amendments or supplements hereto
made in accordance with the terms herein.
Amount
Held for Future Distribution:
As to
any Distribution Date, the aggregate amount held in the related Custodial
Account at the close of business on the immediately preceding Determination
Date
on account of (i) all Scheduled Payments or portions thereof received in respect
of the Mortgage Loans due after the related Due Period and (ii) Principal
Prepayments and Liquidation Proceeds received in respect of the Mortgage Loans
after the last day of the related Prepayment Period.
Annual
Statement of Compliance:
As
defined in Section 3.13.
Applied
Loss Amount:
With
respect to the Senior Certificates and Mezzanine Certificates and any
Distribution Date, the excess of the aggregate Certificate Principal Balance
of
the Senior Certificates and Mezzanine Certificates over the Aggregate Loan
Balance after giving effect to all Realized Losses incurred with respect to
the
Mortgage Loans during the related Due Period and payments of principal to the
Senior Certificates and Mezzanine Certificates on such Distribution
Date.
Appraised
Value:
With
respect to any Mortgage Loan originated in connection with a refinancing, the
appraised value of the Mortgaged Property based upon the appraisal made at
the
time of such refinancing or, with respect to any other Mortgage Loan, the lesser
of (x) the appraised value of the Mortgaged Property based upon the appraisal
made by a fee appraiser at the time of the origination of the Mortgage Loan,
and
(y) the sales price of the Mortgaged Property at the time of such
origination.
Assignment
Agreement:
Shall
mean the Assignment, Assumption and Recognition Agreement, dated as of September
29, 2006, among the Sponsor, the Depositor and Wachovia, pursuant to which
the
Servicing Agreement was assigned to the Depositor, a copy of which is attached
hereto as Exhibit P.
Assumed
Final Distribution Date:
The
Distribution date in October 2036.
Authorized
Servicer Representative:
Any
officer of a Servicer involved in, or responsible for, the administration and
servicing of the related Mortgage Loans whose name and facsimile signature
appear on a list of servicing officers furnished to the Trustee and the Master
Servicer by such Servicer on the Closing Date, as such list may from time to
time be amended.
Balloon
Mortgage Loan:
A
Mortgage Loan that provides for the payment of the unamortized principal balance
of such Mortgage Loan in a single payment, that is substantially greater than
the preceding monthly payment at the maturity of such Mortgage
Loan.
Balloon
Payment:
A
payment of the unamortized principal balance of a Mortgage Loan in a single
payment, that is substantially greater than the preceding Monthly Payment at
the
maturity of such Mortgage Loan.
Bankruptcy
Code:
Title
11 of the United States Code.
Basis
Risk Shortfall Reserve Fund:
The
segregated non-interest bearing trust account created and maintained by the
Securities Administrator pursuant to Section 5.14 hereof.
Basis
Risk Shortfall:
With
respect to any Class of Senior Certificates or Mezzanine Certificates and any
Distribution Date, the sum of (i) the excess, if any, of the related Current
Interest (calculated without regard to the Net Funds Cap) over the related
Current Interest (as it may have been limited by the applicable Net Funds Cap)
for the applicable Distribution Date; (ii) any amount described in clause (i)
remaining unpaid from prior Distribution Dates; and (iii) interest on the amount
in clause (ii) for the related Accrual Period calculated on the basis of the
least of (x) One Month LIBOR plus the applicable Certificate Margin, (y) the
Maximum Interest Rate and (z) the Cap Rate.
Book-Entry
Certificates:
Any of
the Certificates that shall be registered in the name of the Depository or
its
nominee, the ownership of which is reflected on the books of the Depository
or
on the books of a person maintaining an account with the Depository (directly,
as a “Depository Participant”, or indirectly, as an indirect participant in
accordance with the rules of the Depository and as described in
Section 6.06). As of the Closing Date, each Class of Publicly Offered
Certificates constitutes a Class of Book-Entry Certificates.
Business
Day:
Any day
other than (i) a Saturday or a Sunday, or (ii) a day on which banking
institutions in The City of New York, New York, the Commonwealth of
Pennsylvania, the State of Maryland, the State of Minnesota, the city in which
any Corporate Trust Office of the Securities Administrator or the Trustee is
located or the States in which a Servicer’s servicing operations are located are
authorized or obligated by law or executive order to be closed.
Cap
Rate:
11.00%
per annum.
Carryforward
Interest:
With
respect to any Class of Senior Certificates or Mezzanine Certificates and any
Distribution Date, the sum of (i) the amount, if any, by which (x) the sum
of
(A) Current Interest for that Class of Certificates for the immediately
preceding Distribution Date and (B) any unpaid Carryforward Interest for such
Class from previous Distribution Dates exceeds (y) the actual amount distributed
on such Class in respect of interest on the immediately preceding Distribution
Date and (ii) interest on such amount for the related Accrual Period at the
applicable Pass-Through Rate.
Certificate:
Any one
of the certificates of any Class executed and authenticated by the Securities
Administrator in substantially the forms attached hereto as Exhibits A-1 through
A-5.
Certificate
Margin:
With
respect to each Distribution Date on or prior to the first possible Optional
Termination Date, the Certificate Margins for the Class A-1A, Class X-0X, Xxxxx
X-0, Class A-3A, Class X-0X, Xxxxx X-0X, Xxxxx X-0X, Class M-1, Class M-2,
Class
M-3, Class M-4 and Class M-5 Certificates are 0.16%, 0.24%, 0.06%, 0.17%, 0.25%,
0.26%, 0.31%, 0.32%, 0.39%, 0.55%, 0.90% and 1.50%, respectively. With respect
to each Distribution Date following the first possible Optional Termination
Date, the Certificate Margins for the Class A-1A, Class X-0X, Xxxxx X-0, Class
A-3A, Class X-0X, Xxxxx X-0X, Xxxxx X-0X, Class M-1, Class M-2, Class M-3,
Class
M-4 and Class M-5 Certificates are 0.32%, 0.48%, 0.12%, 0.34%, 0.50%, 0.52%,
0.62%, 0.64%, 0.78%, 1.05%, 1.40% and 2.00%, respectively.
Certificate
Notional Balance:
With
respect to the Class X Certificates and any Distribution Date, the
Uncertificated Principal Balance of the REMIC II Regular Interests (other than
REMIC II Regular Interest LTII-P) for such Distribution Date. As of the Closing
Date, the Certificate Notional Balance of the Class X Certificates is equal
to
$476,229,351.38.
Certificate
Owner:
With
respect to a Book-Entry Certificate, the Person that is the beneficial owner
of
such Book-Entry Certificate.
Certificate
Principal Balance:
As to
any Senior Certificate or Mezzanine Certificate and as of any Distribution
Date,
the Initial Certificate Principal Balance of such Certificate plus any
Subsequent Recoveries added to the Certificate Principal Balance pursuant to
Section 5.07(f) less (i) the sum of (a) all amounts distributed with
respect to such Certificate in reduction of the Certificate Principal Balance
thereof on previous Distribution Dates pursuant to Section 5.06 and (b) any
reductions in the Certificate Principal Balance of such Certificate deemed
to
have occurred in connection with the allocations of Realized Losses on the
Mortgage Loans, if any, plus (ii) any Subsequent Recoveries added to the
Certificate Principal Balance of any such Certificate pursuant to
Section 5.07(d), in each case up to the amount of Applied Loss Amounts but
only to the extent that any such Applied Loss Amount has not been paid to any
Class of Certificates as a Deferred Amount. With respect to the Class X
Certificates and any date of determination, the excess, if any, of (i) the
then
Aggregate Loan Balance over (ii) the then aggregate Certificate Principal
Balance of the Senior Certificates and Mezzanine Certificates.
References
herein to the Certificate Principal Balance of a Class of Certificates shall
mean the Certificate Principal Balances of all Certificates in such Class.
Certificate
Register:
The
register maintained pursuant to Section 6.02.
Certificateholder
or Holder:
The
person in whose name a Certificate is registered in the Certificate Register
(initially, Cede & Co., as nominee for the Depository, in the case of any
Book-Entry Certificates).
Certification
Parties:
Has the
meaning set forth in Section 3.18 of this Agreement.
Certifying
Person:
Has the
meaning set forth in Section 3.18 of this Agreement.
Class:
All
Certificates bearing the same Class designation as set forth in
Section 6.01.
Class
A-1 Allocation Percentage:
With
respect to any Distribution Date, a fraction, expressed as a percentage, the
numerator of which is the sum of the Certificate Principal Balances of the
Class
A-1A Certificates and Class A-1B Certificates and the denominator of which
is
the aggregate Certificate Principal Balance of all of the Senior Certificates,
in each case immediately prior to such Distribution Date.
Class
A-1A Certificate:
Any
Certificate designated as a “Class A-1A Certificate” on the face thereof, in the
form of Exhibit A-1 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class A-1A Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive the
related Basis Risk Shortfall and (iii) the obligation to pay any Class IO
Distribution Amount.
Class
A-1A Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the least of (i)
the sum of One-Month LIBOR for that Distribution Date plus (A) on or prior
to
the first possible Optional Termination Date, 0.16% or (B) after the first
possible Optional Termination Date, 0.32%, (ii) the Net Funds Cap, (iii) the
Maximum Interest Rate and (iv) the Cap Rate.
Class
A-1B Certificate:
Any
Certificate designated as a “Class A-1B Certificate” on the face thereof, in the
form of Exhibit A-1 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class A-1B Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive the
related Basis Risk Shortfall and (iii) the obligation to pay any Class IO
Distribution Amount.
Class
A-1B Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the least of (i)
the sum of One-Month LIBOR for that Distribution Date plus (A) on or prior
to
the first possible Optional Termination Date, 0.24% or (B) after the first
possible Optional Termination Date, 0.48%, (ii) the Net Funds Cap, (iii) the
Maximum Interest Rate and (iv) the Cap Rate.
Class
A-2 Certificate:
Any
Certificate designated as a “Class A-2 Certificate” on the face thereof, in the
form of Exhibit A-1 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class A-2 Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive the
related Basis Risk Shortfall and (iii) the obligation to pay any Class IO
Distribution Amount.
Class
A-2 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the least of (i)
the sum of One-Month LIBOR for that Distribution Date plus (A) on or prior
to
the first possible Optional Termination Date, 0.06% or (B) after the first
possible Optional Termination Date, 0.12%, (ii) the Net Funds Cap, (iii) the
Maximum Interest Rate and (iv) the Cap Rate.
Class
A-3A Certificate:
Any
Certificate designated as a “Class A-3A Certificate” on the face thereof, in the
form of Exhibit A-1 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class A-3A Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive the
related Basis Risk Shortfall and (iii) the obligation to pay any Class IO
Distribution Amount.
Class
A-3A Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the least of (i)
the sum of One-Month LIBOR for that Distribution Date plus (A) on or prior
to
the first possible Optional Termination Date, 0.17% or (B) after the first
possible Optional Termination Date, 0.34%, (ii) the Net Funds Cap, (iii) the
Maximum Interest Rate and (iv) the Cap Rate.
Class
A-3B Certificate:
Any
Certificate designated as a “Class A-3B Certificate” on the face thereof, in the
form of Exhibit A-1 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class A-3B Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive the
related Basis Risk Shortfall and (iii) the obligation to pay any Class IO
Distribution Amount.
Class
A-3B Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the least of (i)
the sum of One-Month LIBOR for that Distribution Date plus (A) on or prior
to
the first possible Optional Termination Date, 0.25% or (B) after the first
possible Optional Termination Date, 0.50%, (ii) the Net Funds Cap, (iii) the
Maximum Interest Rate and (iv) the Cap Rate.
Class
A-4A Certificate:
Any
Certificate designated as a “Class A-4A Certificate” on the face thereof, in the
form of Exhibit A-1 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class A-4A Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive the
related Basis Risk Shortfall and (iii) the obligation to pay any Class IO
Distribution Amount.
Class
A-4A Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the least of (i)
the sum of One-Month LIBOR for that Distribution Date plus (A) on or prior
to
the first possible Optional Termination Date, 0.26% or (B) after the first
possible Optional Termination Date, 0.52%, (ii) the Net Funds Cap, (iii) the
Maximum Interest Rate and (iv) the Cap Rate.
Class
A-4B Certificate:
Any
Certificate designated as a “Class A-4B Certificate” on the face thereof, in the
form of Exhibit A-1 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class A-4B Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive the
related Basis Risk Shortfall and (iii) the obligation to pay any Class IO
Distribution Amount.
Class
A-4B Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the least of (i)
the sum of One-Month LIBOR for that Distribution Date plus (A) on or prior
to
the first possible Optional Termination Date, 0.31% or (B) after the first
possible Optional Termination Date, 0.62%, (ii) the Net Funds Cap, (iii) the
Maximum Interest Rate and (iv) the Cap Rate.
Class
IO Distribution Amount:
As defined in Section 5.15 hereof. For
purposes of clarity, the Class IO Distribution Amount for any Distribution
Date
shall equal the amount payable to the Supplemental Interest Trust on such
Distribution Date in excess of the amount payable on the Class IO Interest
on
such Distribution Date, all as further provided in Section 5.15
hereof.
Class
IO Interest:
An
uncertificated interest in the Trust Fund held by the Trustee, evidencing a
REMIC Regular Interest in REMIC III for purposes of the REMIC
Provisions.
Class
M-1 Certificate:
Any
Certificate designated as a “Class M-1 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-1 Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive the
related Basis Risk Shortfall and (iii) the obligation to pay any Class IO
Distribution Amount.
Class
M-1 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the least of (i)
the sum of One-Month LIBOR for that Distribution Date plus (A) on or prior
to
the first possible Optional Termination Date, 0.32% or (B) after the first
possible Optional Termination Date, 0.64%, (ii) the Net Funds Cap, (iii) the
Maximum Interest Rate and (iv) the Cap Rate.
Class
M-1 Principal Payment Amount:
with
respect to any Distribution Date on or after the Stepdown Date and as long
as a
Trigger Event is not in effect with respect to such Distribution Date, will
be
the amount, if any, by which (x) the sum of (i) the Certificate Principal
Balances of the Senior Certificates, after giving effect to payments on such
Distribution Date and (ii) the Certificate Principal Balance of the Class M-1
Certificates immediately prior to such Distribution Date exceeds (y) the lesser
of (A) the product of (i) approximately 92.20% and (ii) the Aggregate Loan
Balance for such Distribution Date and (B) the amount, if any, by which (i)
the
Aggregate Loan Balance for such Distribution Date exceeds (ii) 0.35% of the
Aggregate Loan Balance as of the Cut-off Date.
Class
M-2 Certificate:
Any
Certificate designated as a “Class M-2 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-2 Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive the
related Basis Risk Shortfall and (iii) the obligation to pay any Class IO
Distribution Amount.
Class
M-2 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the least of (i)
the sum of One-Month LIBOR for that Distribution Date plus (A) on or prior
to
the first possible Optional Termination Date, 0.39% or (B) after the first
possible Optional Termination Date, 0.78%, (ii) the Net Funds Cap, (iii) the
Maximum Interest Rate and (iv) the Cap Rate.
Class
M-2 Principal Payment Amount:
With
respect to any Distribution Date on or after the Stepdown Date and as long
as a
Trigger Event is not in effect with respect to such Distribution Date, will
be
the amount, if any, by which (x) the sum of (i) the Certificate Principal
Balances of the Senior Certificates and Class M-1 Certificates, in each case,
after giving effect to payments on such Distribution Date and (ii) the
Certificate Principal Balance of the Class M-2 Certificates immediately prior
to
such Distribution Date exceeds (y) the lesser of (A) the product of (i)
approximately 94.50% and (ii) the Aggregate Loan Balance for such Distribution
Date and (B) the amount, if any, by which (i) the Aggregate Loan Balance for
such Distribution Date exceeds (ii) 0.35% of the Aggregate Loan Balance as
of
the Cut-off Date.
Class
M-3 Certificate:
Any
Certificate designated as a “Class M-3 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-3 Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive the
related Basis Risk Shortfall and (iii) the obligation to pay any Class IO
Distribution Amount.
Class
M-3 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the least of (i)
the sum of One-Month LIBOR for that Distribution Date plus (A) on or prior
to
the first possible Optional Termination Date, 0.55% or (B) after the first
possible Optional Termination Date, 1.05%, (ii) the Net Funds Cap, (iii) the
Maximum Interest Rate and (iv) the Cap Rate.
Class
M-3 Principal Payment Amount:
With
respect to any Distribution Date on or after the Stepdown Date and as long
as a
Trigger Event is not in effect with respect to such Distribution Date, will
be
the amount, if any, by which (x) the sum of (i) the Certificate Principal
Balances of the Senior Certificates, Class M-1 Certificates and Class M-2
Certificates, in each case, after giving effect to payments on such Distribution
Date and (ii) the Certificate Principal Balance of the Class M-3 Certificates
immediately prior to such Distribution Date exceeds (y) the lesser of (A) the
product of (i) approximately 96.30% and (ii) the Aggregate Loan Balance for
such
Distribution Date and (B) the amount, if any, by which (i) the Aggregate Loan
Balance for such Distribution Date exceeds (ii) 0.35% of the Aggregate Loan
Balance as of the Cut-off Date.
Class
M-4 Certificate:
Any
Certificate designated as a “Class M-4 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-4 Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive the
related Basis Risk Shortfall and (iii) the obligation to pay any Class IO
Distribution Amount.
Class
M-4 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the least of (i)
the sum of One-Month LIBOR for that Distribution Date plus (A) on or prior
to
the first possible Optional Termination Date, 0.90% or (B) after the first
possible Optional Termination Date, 1.40%, (ii) the Net Funds Cap, (iii) the
Maximum Interest Rate and (iv) the Cap Rate.
Class
M-4 Principal Payment Amount:
with
respect to any Distribution Date on or after the Stepdown Date and as long
as a
Trigger Event is not in effect with respect to such Distribution Date, will
be
the amount, if any, by which (x) the sum of (i) the Certificate Principal
Balances of the Senior Certificates, Class M-1, Class M-2 and Class M-3
Certificates, in each case, after giving effect to payments on such Distribution
Date and (ii) the Certificate Principal Balance of the Class M-4 Certificates
immediately prior to such Distribution Date exceeds (y) the lesser of (A) the
product of (i) approximately 97.30% and (ii) the Aggregate Loan Balance for
such
Distribution Date and (B) the amount, if any, by which (i) the Aggregate Loan
Balance for such Distribution Date exceeds (ii) 0.35% of the Aggregate Loan
Balance as of the Cut-off Date.
Class
M-5 Certificate:
Any
Certificate designated as a “Class M-5 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-5 Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive the
related Basis Risk Shortfall and (iii) the obligation to pay any Class IO
Distribution Amount.
Class
M-5 Pass-Through Rate:
With
respect to each Distribution Date, a per annum rate equal to the least of (i)
the sum of One-Month LIBOR for that Distribution Date plus (A) on or prior
to
the first possible Optional Termination Date, 1.50% or (B) after the first
possible Optional Termination Date, 2.00%, (ii) the Net Funds Cap, (iii) the
Maximum Interest Rate and (iv) the Cap Rate.
Class
M-5 Principal Payment Amount:
With
respect to any Distribution Date on or after the Stepdown Date and as long
as a
Trigger Event is not in effect with respect to such Distribution Date, will
be
the amount, if any, by which (x) the sum of (i) the Certificate Principal
Balances of the Senior Certificates, Class M-1, Class M-2, Class M-3 and Class
M-4 Certificates, in each case, after giving effect to payments on such
Distribution Date and (ii) the Certificate Principal Balance of the Class M-5
Certificates immediately prior to such Distribution Date exceeds (y) the lesser
of (A) the product of (i) approximately 98.40% and (ii) the Aggregate Loan
Balance for such Distribution Date and (B) the amount, if any, by which (i)
the
Aggregate Loan Balance for such Distribution Date exceeds (ii) 0.35% of the
Aggregate Loan Balance as of the Cut-off Date.
Class
P Certificate:
Any
Certificate designated as a “Class P Certificate” on the face thereof, in the
form of Exhibit A-3 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class P Certificates as set forth herein and
evidencing a Regular Interest in REMIC III.
Class
P Certificate Account:
The
Eligible Account established and maintained by the Securities Administrator
pursuant to Section 5.12(c).
Class
P Interest:
An
uncertificated interest in the Trust Fund held by the Trustee on behalf of
the
Holders of the Class P Certificates, evidencing a Regular Interest in REMIC
III
for purposes of the REMIC Provisions.
Class
R Certificate:
Any
Certificate designated as a “Class R” Certificate on the face thereof in the
form of Exhibit A-4 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class R Certificates as set forth herein and
evidencing the Class R-1 Interest, Class R-2 Interest and Class R-3
Interest.
Class
R-1 Interest:
The
uncertificated residual interest in REMIC I.
Class
R-2 Interest:
The
uncertificated residual interest in REMIC II.
Class
R-3 Interest:
The
uncertificated residual interest in REMIC III.
Class
R-4 Interest:
The
uncertificated residual interest in REMIC IV.
Class
R-5 Interest:
The
uncertificated residual interest in REMIC V.
Class
R-6 Interest:
The
uncertificated residual interest in REMIC VI.
Class
R-X Certificate:
Any
Certificate designated as a “Class R-X” Certificate on the face thereof in the
form of Exhibit A-4 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class R-X Certificates as set forth herein and
evidencing the Class R-4 Interest, Class R-5 Interest and Class R-6
Interest.
Class
X Certificate:
Any
Certificate designated as a “Class X Certificate” on the face thereof, in the
form of Exhibit A-5 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class X Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC IV, (ii) the obligation to pay Basis
Risk Shortfall and (iii) the obligation to pay any Class IO Distribution
Amount.
Class
X Distribution Amount:
With
respect to any Distribution Date and the Class X Certificates, the sum of (i)
the Current Interest and Carryforward Interest and (ii) any
Overcollateralization Release Amount for such Distribution Date remaining after
payments pursuant to items A though N of Section 5.06(a)(iii); provided,
however that on and after the Distribution Date on which the Certificate
Principal Balances of the Senior Certificates and Mezzanine Certificates have
been reduced to zero, the Class X Distribution Amount shall include the
Overcollateralization Amount.
Class
X Interest:
An
uncertificated interest in the Trust Fund held by the Trustee on behalf of
the
Holders of the Class X Certificates, evidencing a Regular Interest in REMIC
III
for purposes of the REMIC Provisions.
Class
X Pass-Through Rate:
On any
Distribution Date, a per annum rate equal to the percentage equivalent of a
fraction, the numerator of which is the sum of the amounts calculated pursuant
to clauses (A) through (N) below, and the denominator of which is the aggregate
of the Uncertificated Principal Balances of REMIC II Regular Interest LT-AA,
REMIC II Regular Interest LT-A1A, REMIC II Regular Interest LT-A1B, REMIC II
Regular Interest LT-A2, REMIC II Regular Interest LT-A3A, REMIC II Regular
Interest LT-3B, REMIC II Regular Interest LT-A4A, REMIC II Regular Interest
LT-A4B, REMIC II Regular Interest LT-M1, REMIC II Regular Interest LT-M2, REMIC
II Regular Interest LT-M3, REMIC II Regular Interest LT-M4, REMIC II Regular
Interest LT-M5 and REMIC II Regular Interest LT-ZZ. For purposes of calculating
the Pass-Through Rate for the Class X Interest, the numerator is equal to
the sum of the following components:
(A) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-AA
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-AA;
(B) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-A1A
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-A1A;
(C) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-A1B
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-A1B;
(D) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-A2
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-A2;
(E) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-A3A
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-A3A;
(F) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-A3B
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-A3B;
(G) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-A4A
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-A4A;
(H) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-A4B
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-A4B;
(I) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M1
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M1;
(J) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M2
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M2;
(K) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M3
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M3;
(L) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M4
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M4;
(M) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M5
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M5; and
(N) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-ZZ
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-ZZ.
The
Class
X Certificates shall be entitled to 100% of amounts distributed on the Class
X
Interest.
Cleanup
Call:
As
defined in Section 10.01.
Closing
Date:
September 29, 2006.
Code:
The
Internal Revenue Code of 1986, including any successor or amendatory
provisions.
Commission:
Shall
mean the United States Securities and Exchange Commission.
Compensating
Interest:
With
respect to any Distribution Date, an amount to be deposited in the Distribution
Account by the related Servicer or the Master Servicer to offset a Prepayment
Interest Shortfall on a Mortgage Loan in accordance with this Agreement or
the
Servicing Agreement; provided, however that the amount of Compensating Interest
required to be paid in respect of the Mortgage Loans shall not, with respect
to
each Servicer, exceed one-half of the Servicing Fee payable to such Servicer
or,
in the case of the Master Servicer, shall not exceed the Master Servicing
Compensation payable to the Master Servicer with respect to the related
Prepayment Period.
Controlling
Person:
Means,
with respect to any Person, any other Person who “controls” such Person within
the meaning of the Securities Act.
Corporate
Trust Office:
The
principal corporate trust office of the Trustee or the Securities Administrator,
as the case maybe, at which, at any particular time its corporate business
in
connection with this agreement shall be administered, which office at the date
of the execution of this instrument is located at (ii) in the case of the
Trustee, HSBC Bank USA, National Association, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: Nomura Asset Acceptance Corp., 2006-AR3 or at such other
address as the Trustee may designate from time to time by notice to the
Certificateholders, the Depositor, the Master Servicer, the Securities
Administrator and the Servicers, and (ii) with respect to the office of the
Securities Administrator, which for purposes of Certificate transfers and
surrender is located at Xxxxx Fargo Bank, N.A., Xxxxx Xxxxxx xxx Xxxxxxxxx
Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000, Attention: Corporate Trust Services-Client
Manager (NAAC 2006-AR3), and for all other purposes is located at Xxxxx Xxxxx
Xxxx, X.X., X.X. Xxx 00, Xxxxxxxx, Xxxxxxxx 00000, Attention: Corporate Trust
Services-Client Manager (NAAC 2006-AR3) (or for overnight deliveries, at 0000
Xxx Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000, Attention: Corporate Trust
Services-Client Manager (NAAC 2006-AR3)), or at such other address as the
Securities Administrator may designate from time to time by notice to the
Certificateholders, the Depositor, the Master Servicer, the Servicers and the
Trustee.
Corresponding
Certificate:
With
respect to:
(i)
|
REMIC
II Regular Interest LT-A1A, the Class A-1A
Certificates,
|
(ii)
|
REMIC
II Regular Interest LT-A1B, the Class A-1B
Certificates,
|
(iii)
|
REMIC
II Regular Xxxxxxxx XX-X0, the Class A-2 Certificates;
|
(iv)
|
REMIC
II Regular Interest LT-A3A, the Class A-3A
Certificates,
|
(v)
|
REMIC
II Regular Interest LT-A3B, the Class A-3B
Certificates,
|
(vi)
|
REMIC
II Regular Interest LT-A4A, the Class A-4A
Certificates,
|
(vii)
|
REMIC
II Regular Interest LT-A4B, the Class A-4B
Certificates,
|
(viii)
|
REMIC
II Regular Interest LT-M1, the Class M-1 Certificates;
|
(ix)
|
REMIC
II Regular Interest LT-M2, the Class M-2 Certificates;
|
(x)
|
REMIC
II Regular Interest LT-M3, the Class M-3 Certificates;
|
(xi)
|
REMIC
II Regular Interest LT-M4, the Class M-4 Certificates;
|
(xii)
|
REMIC
II Regular Interest LT-M5, the Class M-5 Certificates;
and
|
(xiii)
|
REMIC
II Regular Interest LTII-P and the Class P Interest, the Class P
Certificates.
|
Credit
Risk Management Agreement:
The
agreement between the Credit Risk Manager and each Servicer and/or Master
Servicer, dated as of September 29, 2006.
Credit
Risk Management Fee:
As to
each Mortgage Loan and any Distribution Date, an amount equal to 1/12th of
the
Credit Risk Management Fee Rate multiplied by the Stated Principal Balance
of
such Mortgage Loan as of the last day of the related Due Period. The Credit
Risk
Management Fee shall be payable to the Credit Risk Manager and/or the Sponsor
pursuant to Section 3.32(a)(vii) and 3.33(b).
Credit
Risk Management Fee Rate:
0.005%
per annum.
Credit
Risk Manager:
Portfolio Surveillance Analytics, LLC, and its successors and
assigns.
Current
Interest:
With
respect to any Class of Senior Certificates or Mezzanine Certificates and any
Distribution Date, the amount of interest accruing at the applicable
Pass-Through Rate on the related Certificate Principal Balance during the
related Accrual Period; provided, that as to each Class of Senior Certificates
and Mezzanine Certificates, the Current Interest will be reduced by a pro rata
portion of any Net Interest Shortfalls to the extent not covered by excess
interest. No Current Interest will be payable with respect to any Class of
Senior Certificates or Mezzanine Certificates after the Distribution Date on
which the outstanding Certificate Principal Balance of such Certificate has
been
reduced to zero.
Custodial
Accounts:
The
accounts established and maintained by the Servicers with respect to receipts
on
the Mortgage Loans and REO Properties in accordance with Section 3.26(b)
and the Servicing Agreement.
Custodial
Agreement:
The
Custodial Agreement dated as of September 1, 2006 among the Custodian, the
Servicers and the Trustee.
Custodian:
Xxxxx
Fargo Bank, N.A., a national banking association, or any successor thereto
appointed pursuant to the Custodial Agreement.
Cut-off
Date:
September 1, 2006.
Cut-off
Date Principal Balance:
As to
any Mortgage Loan, the unpaid principal balance thereof as of the close of
business on the Cut-off Date after application of all Principal Prepayments
received prior to the Cut-off Date and scheduled payments of principal due
on or
before the Cut-off Date, whether or not received, but without giving effect
to
any installments of principal received in respect of Due Dates after the Cut-off
Date.
Debt
Service Reduction:
With
respect to any Mortgage Loan, any reduction in the amount which a Mortgagor
is
obligated to pay on a monthly basis with respect to such Mortgage Loan as a
result of any proceeding initiated under the United States Bankruptcy Code,
other than a reduction attributable to Deficient Valuation.
Defaulting
Party:
As
defined in the Swap Agreement.
Deferred
Amount:
With
respect to any Class of Senior Certificates or Mezzanine Certificates and any
Distribution Date, the amount by which (x) the aggregate of the Applied Loss
Amounts previously applied in reduction of the Certificate Principal Balance
thereof exceeds (y) the aggregate of amounts previously paid in reimbursement
thereof and the amount by which the Certificate Principal Balance of any such
Class has been increased due to the collection of Subsequent
Recoveries.
Deficient
Valuation:
With
respect to any Mortgage Loan, a valuation by a court of competent jurisdiction
of the Mortgaged Property in an amount less that the then outstanding
indebtedness under the Mortgage Loan, which valuation results from a proceeding
initiated under the United States Bankruptcy Code.
Definitive
Certificates:
As
defined in Section 6.06.
Deleted
Mortgage Loan:
A
Mortgage Loan replaced or to be replaced by a Replacement Mortgage
Loan.
Delinquency
Rate:
With
respect to any calendar month will be, generally, the fraction, expressed as
a
percentage, the numerator of which is the Aggregate Loan Balance of all Mortgage
Loans 60 or more days delinquent (including all Mortgage Loans in bankruptcy
or
foreclosure and all REO Properties) as of the close of business on the last
day
of such month, and the denominator of which is the Aggregate Loan Balance of
the
Mortgage Loans as of the close of business on the last day of such
month.
Delinquent:
A
Mortgage Loan is “delinquent” if any payment due thereon is not made pursuant to
the terms of such Mortgage Loan by the close of business on the day such payment
is scheduled to be due. A Mortgage Loan is “30 days delinquent” if such payment
has not been received by the close of business on the corresponding day of
the
month immediately succeeding the month in which such payment was due, or, if
there is no such corresponding day (e.g., as when a 30-day month follows a
31-day month in which a payment was due on the 31st day of such month), then
on
the last day of such immediately succeeding month. Similarly for “60 days
delinquent,” “90 days delinquent” and so on.
Denomination:
With
respect to each Certificate, the amount set forth on the face thereof as the
“Initial Certificate Principal Balance of this Certificate”.
Depositor:
Nomura
Asset Acceptance Corporation, a Delaware corporation, or its successor in
interest.
Depository:
The
initial Depository shall be The Depository Trust Company (“DTC”), the nominee of
which is Cede & Co., or any other organization registered as a “clearing
agency” pursuant to Section 17A of the Exchange Act. The Depository shall
initially be the registered Holder of the Book-Entry Certificates. The
Depository shall at all times be a “clearing corporation” as defined in
Section 8-102(a)(5) of the Uniform Commercial Code of the State of New
York.
Depository
Agreement:
With
respect to the Class of Book-Entry Certificates, the agreement among the
Depositor, the Trustee and the initial Depository, dated as of the Closing
Date,
substantially in the form of Exhibit I.
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 any Distribution Date, the fifteenth (15th)
day of
the month of such Distribution Date or, if such day is not a Business Day,
the
immediately preceding Business Day.
Distribution
Accounts:
The
separate Eligible Account created and maintained by the Securities Administrator
pursuant to Section 3.31 in the name of the Trustee for the benefit of the
Certificateholders, which shall be designated “Xxxxx Fargo Bank, N.A., in trust
for registered holders of Nomura Asset Acceptance Corp., Mortgage Pass-Through
Certificates, Series 2006-AR3. Funds in the Distribution Account shall be held
in trust for the Certificateholders for the uses and purposes set forth in
this
Agreement.
Distribution
Date:
The
twenty-fifth (25th)
day of
each calendar month after the initial issuance of the Certificates, or if such
twenty-fifth day is not a Business Day, the next succeeding Business Day,
commencing in October 2006.
Due
Date:
As to
any Mortgage Loan, the date in each month on which the related Scheduled Payment
is due, as set forth in the related Mortgage Note.
Due
Period:
With
respect to any Distribution Date, the period from the second day of the calendar
month preceding the calendar month in which such Distribution Date occurs
through the close of business on the first day of the calendar month in which
such Distribution Date occurs.
Eligible
Account:
Any of
(i) an account or accounts maintained with a federal or state chartered
depository institution or trust company, the long-term unsecured debt
obligations and short-term unsecured debt obligations of which are rated by
each
Rating Agency in one of its two highest long-term and its highest short-term
rating categories respectively, at the time any amounts are held on deposit
therein, or (ii) an account or accounts in a depository institution or trust
company in which such accounts are insured by the FDIC (to the limits
established by the FDIC) and the uninsured deposits in which accounts are
otherwise secured such that, as evidenced by an Opinion of Counsel delivered
to
the Trustee and to each Rating Agency, the Certificateholders have a claim
with
respect to the funds in such account or a perfected first priority security
interest against any collateral (which shall be limited to Permitted
Investments) securing such funds that is superior to claims of any other
depositors or creditors of the depository institution or trust company in which
such account is maintained, or (iii) a segregated, non-interest bearing trust
account or accounts maintained with the corporate trust department of a federal
or state chartered depository institution or trust company having capital and
surplus of not less than $50,000,000, acting in its fiduciary capacity or (iv)
any other account acceptable to the Rating Agencies as evidenced in writing
by
the Rating Agencies. Eligible Accounts may bear interest, and may include,
if
otherwise qualified under this definition, accounts maintained with the Trustee
or Securities Administrator.
ERISA:
The
Employee Retirement Income Security Act of 1974, as amended.
ERISA
Restricted Certificate:
Each of
the Class X, Class P and Residual Certificates.
Escrow
Account:
Shall
mean the account or accounts maintained by GMACM pursuant to Section 3.29.
Each Escrow Account shall be an Eligible Account.
Excess
Liquidation Proceeds:
To the
extent not required by law to be paid to the related Mortgagor, the excess,
if
any, of any Liquidation Proceeds with respect to a Mortgage Loan over the Stated
Principal Balance of such Mortgage Loan and accrued and unpaid interest at
the
related Mortgage Rate through the last day of the month in which the Mortgage
Loan has been liquidated.
Exchange
Act:
Securities and Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder.
Exemption:
Prohibited Transaction Exemption 93-32, as amended from time to
time.
Expense
Fee Rate:
The sum
of the Credit Risk Management Fee Rate and Servicing Fee Rate attributable
to
the Mortgage Loans.
Xxxxxx
Xxx:
Xxxxxx
Xxx (formerly, Federal National Mortgage Association), or any successor
thereto.
FDIC:
The
Federal Deposit Insurance Corporation, or any successor thereto.
Final
Recovery Determination:
With
respect to any defaulted Mortgage Loan or any REO Property (other than a
Mortgage Loan or REO Property purchased by the Sponsor or the Master Servicer
pursuant to or as contemplated by Section 2.03(c) or Section 10.01), a
determination made by the related Servicer pursuant to this Agreement or the
Servicing Agreement, as applicable that all Insurance Proceeds, Liquidation
Proceeds and other payments or recoveries which such Servicer, in its reasonable
good faith judgment, expects to be finally recoverable in respect thereof have
been so recovered. Each Servicer shall maintain records of each Final Recovery
Determination made thereby.
FIRREA:
The
Financial Institutions Reform, Recovery, and Enforcement Act of 1989, as
amended.
Fitch:
Fitch
Ratings.
Form
8-K Disclosure Information:
Has the
meaning set forth in Section 5.12(b) of this Agreement.
Xxxxxxx
Mac:
Federal
Home Loan Mortgage Corporation, or any successor thereto.
GMACM:
GMAC
Mortgage Corporation, and any successor thereto appointed under this Agreement
in connection with the servicing and administration of the GMACM Mortgage Loans.
GMACM
Mortgage Loans:
Those
Mortgage Loans serviced by GMACM pursuant to the terms and provisions of this
Agreement and identified as such on the Mortgage Loan Schedule.
Gross
Margin:
With
respect to each Mortgage Loan, the fixed percentage set forth in the related
Mortgage Note that is added to the Index on each Adjustment Date in accordance
with the terms of the related Mortgage Note used to determine the Mortgage
Rate
for such Mortgage Loan.
Indemnified
Persons:
The
Trustee, any Servicer (including any successor to any Servicer), the Master
Servicer, the Securities Administrator, the Custodian, the Trust Fund and their
officers, directors, agents and employees and, with respect to the Trustee,
any
separate co-trustee and its officers, directors, agents and
employees.
Independent:
When
used with respect to any specified Person, any such Person who (a) is in fact
independent of the Depositor, the Master Servicer, the Securities Administrator,
a Servicer, the Sponsor, any originator and their respective Affiliates, (b)
does not have any direct financial interest in or any material indirect
financial interest in the Depositor, the Master Servicer, the Securities
Administrator, a Servicer, the Sponsor, any originator or any Affiliate thereof,
and (c) is not connected with the Depositor, the Master Servicer, the Securities
Administrator, a Servicer, the Sponsor, any originator or any Affiliate thereof
as an officer, employee, promoter, underwriter, trustee, partner, director
or
Person performing similar functions; provided, however, that a Person shall
not
fail to be Independent of the Depositor, the Master Servicer, the Securities
Administrator, a Servicer, the Sponsor, any originator or any Affiliate thereof
merely because such Person is the beneficial owner of one percent (1%) or less
of any class of securities issued by the Depositor, the Master Servicer, the
Securities Administrator, a Servicer, the Sponsor, any originator or any
Affiliate thereof, as the case may be.
When
used
with respect to any accountants, a Person who is “independent” within the
meaning of Rule 2-01(B) of the Securities and Exchange Commission’s Regulation
S-X. Independent means, when used with respect to any other Person, a Person
who
(A) is in fact independent of another specified Person and any affiliate of
such
other Person, (B) does not have any material direct or indirect financial
interest in such other Person or any affiliate of such other Person, (C) is
not
connected with such other Person or any affiliate of such other Person as an
officer, employee, promoter, underwriter, Securities Administrator, partner,
director or Person performing similar functions and (D) is not a member of
the
immediate family of a Person defined in clause (B) or (C) above.
Index:
As of
any Adjustment Date, the index applicable to the determination of the Mortgage
Rate on each Mortgage Loan which will generally be based on One-Month LIBOR
Six-Month LIBOR or One-Year LIBOR.
Initial
Certificate Principal Balance:
With
respect to any Certificate, the Certificate Principal Balance of such
Certificate or any predecessor Certificate on the Closing Date.
Insurance
Policy:
With
respect to any Mortgage Loan included in the Trust Fund, any insurance policy,
including all riders and endorsements thereto in effect with respect to such
Mortgage Loan, including any replacement policy or policies for any Insurance
Policies.
Insurance
Proceeds:
Proceeds paid in respect of the Mortgage Loans pursuant to any Insurance Policy
or any other insurance policy covering a Mortgage Loan, to the extent such
proceeds are payable to the mortgagee under the Mortgage, the related Servicer
or the trustee under the deed of trust and are not applied to the restoration
of
the related Mortgaged Property or released to the Mortgagor in accordance with
the servicing standard set forth in Section 3.01 hereof or pursuant to the
Servicing Agreement, other than any amount included in such Insurance Proceeds
in respect of Insured Expenses.
Insured
Expenses:
Expenses covered by any Insurance Policy with respect to the Mortgage
Loans.
Interest
Determination Date:
Shall
mean the second LIBOR Business Day preceding the commencement of each Accrual
Period.
Interest
Remittance Amount:
With
respect to any Distribution Date, an amount generally equal to the sum, without
duplication, of (a) all scheduled interest during the related Due Period with
respect to the Mortgage Loans less the Servicing Fee, the Credit Risk Management
Fee and the fee payable to any provider of lender-paid mortgage insurance,
if
any, (b) the interest portion of all Principal Prepayments in full and partial
Principal Prepayments received during the related Prepayment Period, (c) all
Advances relating to interest with respect to the Mortgage Loans made on or
prior to the related Remittance Date, (d) all Compensating Interest with respect
to the Mortgage Loans and required to be remitted by the related Servicers
or
the Master Servicer pursuant to this Agreement or the Servicing Agreement with
respect to such Distribution Date, (e) Liquidation Proceeds and Subsequent
Recoveries with respect to the Mortgage Loans collected during the related
Prepayment Period (to the extent such Liquidation Proceeds and Subsequent
Recoveries relate to interest), (f) all amounts relating to interest with
respect to each Mortgage Loan repurchased by the Sponsor pursuant to Sections
2.02 and 2.03 and (g) all amounts in respect of interest paid by the Master
Servicer pursuant to Section 10.01 to the extent remitted by the Master
Servicer to the Distribution Account pursuant to this Agreement, minus (h)
all
amounts required to be reimbursed by the Trust pursuant to Section 3.32 or
as otherwise set forth in this Agreement, the Servicing Agreement or the
Custodial Agreement.
Interest
Shortfall:
With
respect to any Distribution Date, the aggregate shortfall, if any, in
collections of interest (adjusted to the related Net Mortgage Rates) on Mortgage
Loans resulting from (a) Principal
Prepayments in full received during the related Prepayment Period, (b) partial
Principal Prepayments received during the related Prepayment Period to the
extent applied prior to the Due Date in the month of the Distribution
Date
and (c)
interest payments on certain of the Mortgage Loans being limited pursuant to
the
provisions of the Relief Act.
ISDA
Master Agreement:
The
ISDA Master Agreement dated as of September 29, 2006, as amended and
supplemented from time to time, between the Swap Provider and the Trustee,
as
trustee on behalf of the Supplemental Interest Trust.
Last
Scheduled Distribution Date:
The
Distribution Date in October 2036.
Latest
Possible Maturity Date:
The
second Distribution Date following the final scheduled maturity date of the
Mortgage Loan in the Trust Fund having the latest scheduled maturity date as
of
the Cut-off Date. For purposes of the Treasury Regulations under Code
Section 860A through 860G, the latest possible maturity date of each
regular interest issued by REMIC I, REMIC II, REMIC III, REMIC IV, REMIC V
and
REMIC VI shall be the Latest Possible Maturity Date.
LIBOR
Business Day:
Shall
mean any day other than a Saturday or a Sunday or a day on which banking
institutions in the State of New York or in the city of London, England are
required or authorized by law to be closed.
LIBOR
Determination Date:
The
second LIBOR Business Day before the first day of the related Accrual
Period.
Liquidated
Loan:
With
respect to any Distribution Date, a defaulted Mortgage Loan that has been
liquidated through deed-in-lieu of foreclosure, foreclosure sale, trustee’s sale
or other realization as provided by applicable law governing the real property
subject to the related Mortgage and any security agreements and as to which
the
related Servicer has certified in the related Prepayment Period in writing
to
the Securities Administrator that it has made a Final Recovery
Determination.
Liquidation
Principal:
The
principal portion of Liquidation Proceeds received on a Mortgage Loan that
became a Liquidated Mortgage Loan, but not in excess of the Stated Principal
Balance of that Mortgage Loan, during the calendar month preceding the month
of
the Distribution Date.
Liquidation
Proceeds:
Amounts, other than Insurance Proceeds, received in connection with the partial
or complete liquidation of a Mortgage Loan, whether through trustee’s sale,
foreclosure sale or otherwise, or in connection with any condemnation or partial
release of a Mortgaged Property and any other proceeds received with respect
to
an REO Property, less the sum of related unreimbursed Advances, Servicing Fees
and Servicing Advances and all expenses of liquidation, including property
protection expenses and foreclosure and sale costs, including court and
reasonable attorneys fees.
Loan-to-Value
Ratio:
The
fraction, expressed as a percentage, the numerator of which is the original
principal balance of the Mortgage Loan and the denominator of which is the
Appraised Value of the related Mortgaged Property.
Majority
Class X Certificateholder:
The
Holder of a 50.01% or greater Percentage Interest in the Class X
Certificates.
Marker
Rate:
With
respect to the Class X Interest and any Distribution Date, a per annum rate
equal to two (2) times the weighted average of the Uncertificated REMIC II
Pass-Through Rates for REMIC II Regular Interest LT-A1A, REMIC II Regular
Interest LT-A1B, REMIC II Regular Interest LT-A2, REMIC II Regular Interest
LT-A3A, REMIC II Regular Interest LT-A3B, REMIC II Regular Interest LT-A4A,
REMIC II Regular Interest LT-A4B, REMIC II Regular Interest LT-M1, REMIC II
Regular Interest LT-M2, REMIC II Regular Interest LT-M3, REMIC II Regular
Interest LT-M4, REMIC II Regular Interest LT-M5 and REMIC II Regular Interest
LT-ZZ, with the per annum rate on each such REMIC II Regular Interest (other
than REMIC II Regular Interest LT-ZZ) subject to a cap equal to the Pass-Through
Rate on the Corresponding Certificate for the purpose of this calculation;
and
with the per annum rate on REMIC II Regular Interest LTI-ZZ subject to a cap
of
zero for the purpose of this calculation; provided, however, that for this
purpose, the calculation of the Uncertificated REMIC II Pass-Through Rate and
the related cap with respect to each such REMIC II Regular Interest (other
than
REMIC II Regular Interest LT-ZZ) shall be multiplied by a fraction, the
numerator of which is the actual number of days in the Accrual Period and the
denominator of which is thirty (30).
Master
Servicer:
As of
the Closing Date, Xxxxx Fargo Bank, N.A. and thereafter, its respective
successors in interest who meet the qualifications of this Agreement. The Master
Servicer and the Securities Administrator shall at all times be the same Person
or Affiliates.
Master
Servicer Default:
One or
more of the events described in Section 8.01(b).
Master
Servicing Compensation:
As
defined in Section 4.12.
Maximum
Interest Rate:
With
respect to any Distribution Date and the related Accrual Period, an annual
rate
equal to the weighted average of the Maximum Mortgage Interest Rates of the
Mortgage Loans minus the weighted average expense rate of the Mortgage Loans.
The calculation of the Maximum Interest Rate will be based on a 360-day year
and
the actual number of days elapsed during the related Accrual
Period.
Maximum
Mortgage Interest Rate:
With
respect to each Mortgage Loan, the percentage set forth in the related Mortgage
Note as the maximum interest rate.
MERS:
Mortgage Electronic Registration Systems, Inc., a corporation organized and
existing under the laws of the State of Delaware, or any successor
thereto.
MERS®
System:
The
system of recording transfers of Mortgages electronically maintained by
MERS.
Mezzanine
Certificates:
The
Class M-1, Class M-2, and Class M-3, Class M-4 and Class M-5
Certificates.
MIN:
The
Mortgage Identification Number for Mortgage Loans registered with MERS on the
MERS® System.
Minimum
Mortgage Interest Rate:
With
respect to each Mortgage Loan, the percentage set forth in the related Mortgage
Note as the minimum Mortgage Rate thereunder.
Minimum
Servicing Requirements:
With
respect to a successor to GMACM appointed pursuant to Section 7.06(a)
hereunder:
(ii) the
proposed successor Servicer is (1) an affiliate of the Master Servicer that
services mortgage loans similar to the Mortgage Loans in the jurisdictions
in
which the related Mortgaged Properties are located or (2) the proposed successor
Servicer has a rating of at least “Above Average” by S&P and either a rating
of at least “RPS2” by Fitch or a rating of at least “SQ2” by Moody’s;
and
(iii) the
proposed successor Servicer has a net worth of at least
$25,000,000.
MOM
Loan:
Any
Mortgage Loan as to which MERS is acting as the mortgagee of such Mortgage
Loan,
solely as nominee for the originator of such Mortgage Loan and its successors
and assigns, at the origination thereof.
Monthly
Excess Cashflow:
With
respect to any Distribution Date, means the sum of (a) the Monthly Excess
Interest, (b) the Overcollateralization Release Amount, if any, for such
Distribution Date, and (c) the Principal Remittance Amount remaining following
payments of the Principal Payment Amount to the Senior Certificates and
Mezzanine Certificates.
Monthly
Excess Interest:
With
respect to any Distribution Date, the excess of (x) the Interest Remittance
Amount for such Distribution Date over (y) the sum of Current Interest and
Carryforward Interest on the Senior Certificates and Mezzanine Certificates
for
such Distribution Date.
Monthly
Statement:
The
statement delivered to the Certificateholders pursuant to
Section 5.07.
Moody’s:
Xxxxx’x
Investors Service, Inc. or its successor in interest.
Mortgage:
The
mortgage, deed of trust or other instrument creating a first lien on or first
priority ownership interest in an estate in fee simple in real property securing
a Mortgage Note.
Mortgage
File:
The
Mortgage Loan Documents pertaining to a particular Mortgage Loan and any
additional documents delivered to the Trustee or the Custodian on behalf of
the
Trustee to be added to the Mortgage File pursuant to this
Agreement.
Mortgage
Loan Documents:
As
defined in Section 2.01.
Mortgage
Loans:
Such of
the Mortgage Loans transferred and assigned to the Trustee pursuant to the
provisions hereof, as from time to time are held as a part of the Trust Fund
(including any REO Property), the mortgage loans so held being identified in
the
Mortgage Loan Schedule, notwithstanding foreclosure or other acquisition of
title of the related Mortgaged Property.
Mortgage
Loan Purchase Agreement:
The
Mortgage Loan Purchase Agreement dated as of September 29, 2006, between the
Sponsor, as seller and the Depositor, as purchaser, a form of which is attached
hereto as Exhibit
C.
Mortgage
Loan Purchase Price:
The
price, calculated as set forth in Section 10.01, to be paid in connection
with the purchase of the Mortgage Loans pursuant to
Section 10.01.
Mortgage
Loan Schedule:
The
list of Mortgage Loans (as from time to time amended by the Servicers to reflect
the deletion of Deleted Mortgage Loans and the addition of Replacement Mortgage
Loans pursuant to the provisions of this Agreement) transferred to the Trustee
as part of the Trust Fund and from time to time subject to this Agreement,
the
initial Mortgage Loan Schedule being attached hereto as Exhibit
B,
setting
forth the following information with respect to each Mortgage Loan:
(i) the
Mortgage Loan identifying number;
(ii) the
Mortgage Rate in effect as of the Cut-off Date;
(iv) the
Servicing Fee Rate;
(v) the
Net
Mortgage Rate in effect as of the Cut-off Date;
(vi) the
maturity date;
(vii) the
original principal balance;
(viii) the
Cut-off Date Principal Balance;
(ix) the
original term;
(x) the
remaining term;
(xi) the
property type;
(xii) the
product type (e.g., 2/28, 15 year fixed, 30 year fixed, 15/30 balloon,
etc.);
(xiii) with
respect to each MOM Loan, the related MIN;
(xiv) the
Custodian;
(xv) a
code
indicating whether the Mortgage Loan is subject to a Prepayment Charge, the
term
of such Prepayment Charge and the amount of such Prepayment Charge;
(xvi) the
first
Adjustment Date;
(xvii) the
Gross
Margin;
(xviii) the
Maximum Mortgage Interest Rate under the terms of the Mortgage
Note;
(xix) the
Minimum Mortgage Interest Rate under the terms of the Mortgage
Note;
(xx) the
Periodic Rate Cap;
(xxi) the
first
Adjustment Date immediately following the Cut-off Date;
(xxii) the
related Index; and
(xxiii) the
Servicer.
Such
schedule shall also set forth the aggregate Cut-off Date Principal Balance
for
all of the Mortgage Loans.
Mortgage
Note:
The
original executed note or other evidence of indebtedness of a Mortgagor under
a
Mortgage Loan.
Mortgage
Rate:
With
respect to each Mortgage Loan, the annual rate at which interest accrues on
such
Mortgage Loan from time to time in accordance with the provisions of the related
Mortgage Note, which rate (A) as of any date of determination until the first
Adjustment Date following the Cut-off Date shall be the rate set forth in the
Mortgage Loan Schedule as the Mortgage Rate in effect immediately following
the
Cut-off Date and (B) as of any date of determination thereafter shall be the
rate as adjusted on the most recent Adjustment Date equal to the sum, rounded
to
the nearest 0.125% as provided in the Mortgage Note, of the related Index,
as
most recently available as of a date prior to the Adjustment Date as set forth
in the related Mortgage Note, plus the related Gross Margin; provided that
the
Mortgage Rate on such adjustable rate Mortgage Loan on any Adjustment Date
shall
never be more than the lesser of (i) the sum of the Mortgage Rate in effect
immediately prior to the Adjustment Date plus the related Periodic Rate Cap,
if
any, and (ii) the related Maximum Mortgage Rate, and shall never be less than
the greater of (i) the Mortgage Rate in effect immediately prior to the
Adjustment Date less the Periodic Rate Cap, if any, and (ii) the related Minimum
Mortgage Rate. With respect to each Mortgage Loan that becomes an REO Property,
as of any date of determination, the annual rate determined in accordance with
the immediately preceding sentence as of the date such Mortgage Loan became
an
REO Property.
Mortgaged
Property:
The
underlying property securing a Mortgage Loan.
Mortgagor:
The
obligor on a Mortgage Note.
Net
Funds Cap:
With
respect to any Distribution Date, (a) a fraction, expressed as a percentage,
the
numerator of which is the product of (1) the Optimal Interest Remittance Amount
for the Mortgage Loans and such Distribution Date, minus the sum of (x) any
Net
Swap Payment payable to the Swap Provider on such Distribution Date, and (y)
any
Swap Termination Payment (unless such payment is the result of a Swap Provider
Trigger Event and to the extent not paid by the Securities Administrator from
any upfront payment received pursuant to any replacement interest rate swap
agreement that may be entered into by the Supplemental Interest Trust Trustee)
payable to the Swap Provider on such Distribution Date, and (2) 12, and the
denominator of which is the outstanding Aggregate Loan Balance for the
immediately preceding Distribution Date, multiplied by (b) a fraction, the
numerator of which is 30, and the denominator of which is the actual number
of
days which have elapsed in the immediately preceding Interest Accrual Period.
For federal income tax purposes, the equivalent of the foregoing shall be
expressed as the weighted average of the Uncertificated REMIC II Pass-Through
Rate on each REMIC II Regular Interest (other than REMIC II Regular Interest
LT-P and REMIC II Regular Interest LT-IO), weighted on the basis of the
Uncertificated Principal Balance of each such REMIC II Regular
Interest.
Net
Interest Shortfall:
Means
Interest Shortfalls net of payments by the Servicers or Master Servicer in
respect of Compensating Interest.
Net
Liquidation Proceeds:
With
respect to a Mortgage Loan are Liquidation Proceeds net of unreimbursed advances
by the related Servicer and advances and expenses incurred by the related
Servicer in connection with the liquidation of such Mortgage Loan and the
related Mortgaged Property.
Net
Mortgage Rate:
As to
each Mortgage Loan, and at any time, the per annum rate equal to the related
Mortgage Rate less the sum of (i) the Servicing Fee Rate, (ii) the Credit Risk
Management Fee Rate and (iii) the rate at which the fee payable to any provider
of lender-paid mortgage insurance is calculated, if applicable.
Net
Swap Payment:
With
respect to each Distribution Date, the net payment required to be made pursuant
to the terms of the Swap Agreement by either the Swap Provider or the
Supplemental Interest Trust, which net payment shall not take into account
any
Swap Termination Payment.
Non-Book-Entry
Certificate:
Any
Certificate other than a Book-Entry Certificate.
Nonrecoverable
Advance:
With
respect to any Mortgage Loan, any portion of an Advance or Servicing Advance
previously made or proposed to be made by the related Servicer pursuant to
this
Agreement or the Servicing Agreement, as applicable or the Master Servicer
as
Successor Servicer, that, in the good faith judgment of the related Servicer
or
the Master Servicer as Successor Servicer, will not or, in the case of a
proposed Advance or Servicing Advance, would not, be ultimately recoverable
by
it from the related Mortgagor, related Liquidation Proceeds, Insurance Proceeds
or otherwise.
“Notional
Amount”:
For
each calculation period as defined in the Swap Agreement, the amount set forth
below:
Distribution
Date
|
Notional
Amount ($)
|
October
25, 2006
|
472,418,000.00
|
November
25, 2006
|
459,097,789.75
|
December
25, 2006
|
432,978,863.62
|
January
25, 2007
|
411,415,887.20
|
February
25, 2007
|
390,666,482.98
|
March
25, 2007
|
371,455,819.09
|
April
25, 2007
|
353,010,487.38
|
May
25, 2007
|
335,632,598.76
|
June
25, 2007
|
319,100,536.50
|
July
25, 2007
|
303,373,139.34
|
August
25, 2007
|
288,411,248.78
|
September
25, 2007
|
274,177,611.64
|
October
25, 2007
|
260,636,787.37
|
November
25, 2007
|
247,755,059.88
|
December
25, 2007
|
235,500,353.60
|
January
25, 2008
|
223,842,153.73
|
February
25, 2008
|
212,751,430.25
|
March
25, 2008
|
202,200,565.71
|
April
25, 2008
|
192,163,286.51
|
May
25, 2008
|
182,217,216.09
|
June
25, 2008
|
172,878,624.57
|
July
25, 2008
|
151,213,250.66
|
August
25, 2008
|
143,657,557.62
|
September
25, 2008
|
136,469,695.50
|
October
25, 2008
|
129,631,760.90
|
November
25, 2008
|
123,126,721.71
|
December
25, 2008
|
116,938,374.66
|
January
25, 2009
|
111,051,305.01
|
February
25, 2009
|
105,450,848.20
|
March
25, 2009
|
100,123,053.32
|
April
25, 2009
|
92,141,490.79
|
May
25, 2009
|
87,441,918.44
|
June
25, 2009
|
82,990,674.14
|
July
25, 2009
|
77,257,838.91
|
August
25, 2009
|
68,844,596.01
|
September
25, 2009
|
65,299,283.83
|
October
25, 2009
|
61,926,586.08
|
November
25, 2009
|
60,968,110.52
|
December
25, 2009
|
57,915,843.15
|
January
25, 2010
|
55,012,189.73
|
February
25, 2010
|
52,249,915.85
|
March
25, 2010
|
49,622,139.22
|
April
25, 2010
|
47,122,312.52
|
May
25, 2010
|
44,744,207.07
|
June
25, 2010
|
42,481,897.37
|
July
25, 2010
|
40,329,746.30
|
August
25, 2010
|
38,282,315.40
|
September
25, 2010
|
36,334,585.70
|
October
25, 2010
|
34,481,703.30
|
November
25, 2010
|
32,719,050.56
|
December
25, 2010
|
31,042,234.60
|
January
25, 2011
|
29,447,076.37
|
February
25, 2011
|
27,929,600.25
|
March
25, 2011
|
26,486,024.12
|
April
25, 2011
|
25,112,749.97
|
May
25, 2011
|
23,787,289.81
|
June
25, 2011
|
22,444,309.01
|
July
25, 2011
|
17,236,006.36
|
August
25, 2011
|
4,834,366.66
|
September
25, 2011
|
4,515,519.80
|
October
25, 2011 and thereafter
|
0.00
|
Officer’s
Certificate:
A
certificate (i) signed by the Chairman of the Board, the Vice Chairman of the
Board, the President, a Vice President (however denominated), an Assistant
Vice
President, the Treasurer, the Secretary, or one of the assistant treasurers
or
assistant secretaries of the Depositor or the Trustee (or any other officer
customarily performing functions similar to those performed by any of the above
designated officers and also to whom, with respect to a particular matter,
such
matter is referred because of such officer’s knowledge of and familiarity with a
particular subject) or (ii), if provided for in this Agreement, signed by an
Authorized Servicer Representative, as the case may be, and delivered to the
Depositor, the Sponsor, the Master Servicer, the Securities Administrator and/or
the Trustee, as the case may be, as required by this Agreement.
One-Month
LIBOR:
With
respect to any Accrual Period (other than the first Accrual Period), the rate
determined by the Securities Administrator on the related Interest Determination
Date on the basis of the rate for U.S. dollar deposits for one month that
appears on Telerate Screen Page 3750 as of 11:00 a.m. (London time) on such
Interest Determination Date. If such rate does not appear on such page (or
such
other page as may replace that page on that service, or if such service is
no
longer offered, such other service for displaying One-Month LIBOR or comparable
rates as may be reasonably selected by the Securities Administrator), One-Month
LIBOR for the applicable Accrual Period will be the Reference Bank Rate. If
no
such quotations can be obtained by the Securities Administrator and no Reference
Bank Rate is available, One-Month LIBOR will be One-Month LIBOR applicable
to
the preceding Accrual Period. The establishment of One-Month LIBOR on each
Interest Determination Date by the Securities Administrator and the Securities
Administrator’s calculation of the rate of interest applicable to the Senior
Certificates and Mezzanine Certificates for the related Accrual Period shall,
in
the absence of manifest error, be final and binding. With respect to the first
Accrual period, One-Month LIBOR shall equal 5.326% per annum.
One-Year
LIBOR: The
per
annum rate equal to the average of interbank offered rates for one-year U.S.
dollar-denominated deposits in the London market based on quotations of major
banks as published in The Wall Street Journal and most recently available as
of
the time specified in the related Mortgage Note.
Opinion
of Counsel:
A
written opinion of counsel, who may be counsel for the Sponsor, the Master
Servicer, the Depositor or a Servicer, reasonably acceptable to each addressee
of such opinion; provided that with respect to Section 2.05, 7.05 or 11.01,
or the interpretation or application of the REMIC Provisions, such counsel
must
(i) in fact be independent of the Sponsor, the Master Servicer Depositor and
such Servicer, (ii) not have any direct financial interest in the Sponsor,
the
Depositor, the Master Servicer or such Servicer or in any affiliate of any
of
them, and (iii) not be connected with the Sponsor, the Depositor, the Master
Servicer or such Servicer as an officer, employee, promoter, underwriter,
trustee, partner, director or person performing similar functions.
Optimal
Interest Remittance Amount:
With
respect to any Distribution Date and the Senior Certificates and Mezzanine
Certificates, will be equal to the excess of (i) the product of (1)(x) the
weighted average Net Mortgage Rates of the Mortgage Loans as of the first day
of
the related Due Period divided by (y) 12 and (2) the Aggregate Loan Balance
for
the immediately preceding Distribution Date, over (ii) any expenses that reduce
the Interest Remittance Amount that did not arise as a result of a default
or
delinquency of the Mortgage Loans or were not taken into account in computing
the expense fee rate.
Optional
Termination:
The
termination of the Trust Fund created hereunder as a result of the purchase
of
all of Mortgage Loans and REO Properties, as described in
Section 10.01.
Optional
Termination Date:
The
first Distribution Date on which the Master Servicer may purchase, at its option
the Mortgage Loans and all REO Properties, as described in
Section 10.01.
OTS:
The
Office of Thrift Supervision or any successor thereto.
OTS
Method:
The
method used by OTS to calculate delinquencies.
Outstanding:
With
respect to the Certificates as of any date of determination, all Certificates
theretofore executed and authenticated under this Agreement except:
(a) Certificates
theretofore canceled by the Securities Administrator or delivered to the
Securities Administrator for cancellation; and
(b) Certificates
in exchange for which or in lieu of which other Certificates have been executed
and delivered by the Securities Administrator pursuant to this
Agreement.
Outstanding
Mortgage Loan:
As of
any date of determination, a Mortgage Loan with a Stated Principal Balance
greater than zero that was not the subject of a Principal Prepayment in full,
and that did not become a Liquidated Loan, prior to the end of the related
Prepayment Period.
Overcollateralization
Amount:
With
respect to any Distribution Date, the excess, if any, of (a) the Aggregate
Loan
Balance for such Distribution Date over (b) the aggregate Certificate Principal
Balance of the Senior Certificates and Mezzanine Certificates on such
Distribution Date (after taking into account the payment of 100% of the
Principal Remittance Amount on such Distribution Date).
Overcollateralization
Deficiency Amount:
With
respect to any Distribution Date, will be equal to the amount, if any, by which
(x) the Targeted Overcollateralization Amount for such Distribution Date exceeds
(y) the Overcollateralization Amount for such Distribution Date, calculated
for
this purpose after giving effect to the reduction on such Distribution Date
of
the aggregate Certificate Principal Balance of the Senior Certificates and
Mezzanine Certificates resulting from the payment of the Principal Remittance
Amount on such Distribution Date, but prior to allocation of any Applied Loss
Amount on such Distribution Date.
Overcollateralization
Release Amount:
With
respect to any Distribution Date, will be equal to the lesser of (x) the
Principal Remittance Amount for such Distribution Date and (y) the amount,
if
any, by which (1) the Overcollateralization Amount for such date, exceeds (2)
the Targeted Overcollateralization Amount for such Distribution
Date.
Ownership
Interest:
As to
any 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.
Pass-Through
Rate:
The
Class A-1A, Class X-0X, Xxxxx X-0, Class A-3A, Class X-0X, Xxxxx X-0X, Xxxxx
X-0X, Class M-1, Class M-2, Class M-3, Class M-4, Class M-5 and Class X
Pass-Through Rate, as applicable.
Payahead:
Any
Scheduled Payment intended by the related Mortgagor to be applied in a Due
Period subsequent to the Due Period in which such payment was
received.
PCAOB:
Shall
mean the Public Company Accounting Oversight Board.
Percentage
Interest:
With
respect to any Certificate of a specified Class, the Percentage Interest set
forth on the face thereof or the percentage obtained by dividing the
Denomination of such Certificate by the aggregate of the Denominations of all
Certificates of such Class.
Periodic
Rate Cap:
With
respect to the Adjustment Date for a Mortgage Loan, the fixed percentage set
forth in the related Mortgage Note, which is the maximum amount by which the
Mortgage Rate for such Mortgage Loan may increase or decrease (without regard
to
the Maximum Mortgage Interest Rate or the Minimum Mortgage Interest Rate) on
such Adjustment Date from the Mortgage Rate in effect immediately prior to
such
Adjustment Date.
Permitted
Investments:
At any
time, any one or more of the following obligations and securities:
(xxiv) direct
obligations of, or obligations fully guaranteed as to timely payment of
principal and interest by, the United States or any agency thereof, provided
such obligations are unconditionally backed by the full faith and credit of
the
United States;
(xxv) general
obligations of or obligations guaranteed by any state of the United States
or
the District of Columbia receiving the highest long-term debt rating of each
Rating Agency, or such lower rating as will not result in the downgrading or
withdrawal of the ratings then assigned to the Certificates by each Rating
Agency, as evidenced by a signed writing delivered by each Rating
Agency;
(xxvi) commercial
or finance company paper which is then receiving the highest commercial or
finance company paper rating of each Rating Agency that rates such securities,
or such lower rating as will not result in the downgrading or withdrawal of
the
ratings then assigned to the Certificates by each Rating Agency, as evidenced
by
a signed writing delivered by each Rating Agency;
(xxvii) certificates
of deposit, demand or time deposits, or bankers’ acceptances issued by any
depository institution or trust company incorporated under the laws of the
United States or of any state thereof and subject to supervision and examination
by federal and/or state banking authorities (including the Trustee or the Master
Servicer in its commercial banking capacity), provided that the commercial
paper
and/or long term unsecured debt obligations of such depository institution
or
trust company are then rated one of the two highest long-term and the highest
short-term ratings of each such Rating Agency for such securities, or such
lower
ratings as will not result in the downgrading or withdrawal of the rating then
assigned to the Certificates by any Rating Agency, as evidenced by a signed
writing delivered by each Rating Agency;
(xxviii) demand
or
time deposits or certificates of deposit issued by any bank or trust company
or
savings institution to the extent that such deposits are fully insured by the
FDIC;
(xxix) guaranteed
reinvestment agreements issued by any bank, insurance company or other
corporation containing, at the time of the issuance of such agreements, such
terms and conditions as will not result in the downgrading or withdrawal of
the
rating then assigned to the Certificates by any such Rating Agency, as evidenced
by a signed writing delivered by each Rating Agency;
(xxx) repurchase
obligations with respect to any security described in clauses (i) and (ii)
above, in either case entered into with a depository institution or trust
company (acting as principal) described in clause (v) above;
(xxxi) securities
(other than stripped bonds, stripped coupons or instruments sold at a purchase
price in excess of 115% of the face amount thereof) bearing interest or sold
at
a discount issued by any corporation incorporated under the laws of the United
States or any state thereof which, at the time of such investment, have one
of
the two highest long term ratings of each Rating Agency, or such lower rating
as
will not result in the downgrading or withdrawal of the rating then assigned
to
the Certificates by any Rating Agency, as evidenced by a signed writing
delivered by each Rating Agency;
(xxxii) units
of
money market funds registered under the Investment Company Act of 1940 including
funds managed or advised by the Trustee, the Master Servicer or an affiliate
of
either, having a rating by S&P of AAAm-G or AAAm, if rated by Xxxxx’x, rated
Aaa, Aa1 or Aa2, and if rated by Fitch, F1, F2 or F3;
(xxxiii) short
term investment funds sponsored by any trust company or banking association
incorporated under the laws of the United States or any state thereof (including
any such fund managed or advised by the Trustee, the Master Servicer or any
affiliate thereof) which on the date of acquisition has been rated by each
Rating Agency in their respective highest applicable rating category or such
lower rating as will not result in the downgrading or withdrawal of the ratings
then assigned to the Certificates by each Rating Agency, as evidenced by a
signed writing delivered by each Rating Agency; and
(xxxiv) such
other investments having a specified stated maturity and bearing interest or
sold at a discount acceptable to each Rating Agency as will not result in the
downgrading or withdrawal of the rating then assigned to the Certificates by
any
Rating Agency, as evidenced by a signed writing delivered by each Rating Agency,
as evidenced by a signed writing delivered by each Rating Agency;
provided,
however, that no instrument described hereunder shall evidence either the right
to receive (a) only interest with respect to the obligations underlying such
instrument or (b) both principal and interest payments derived from obligations
underlying such instrument and the interest and principal payments with respect
to such instrument provide a yield to maturity at par greater than 120% of
the
yield to maturity at par of the underlying obligations.
Permitted
Transferee:
Any
person other than (i) the United States, any State or political subdivision
thereof, any possession of the United States 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)
that 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 citizen or resident of the United States, a corporation,
partnership (other than a partnership that has any direct or indirect foreign
partners) or other entity (treated as a corporation or a partnership for federal
income tax purposes), created or organized in or under the laws of the United
States, any state thereof or the District of Columbia, an estate whose income
from sources without the United States is includible in gross income for United
States federal income tax purposes regardless of its connection with the conduct
of a trade or business within the United States, or a trust if a court within
the United States is able to exercise primary supervision over the
administration of the trust and one or more United States persons have authority
to control all substantial decisions of the trustor and (vi) any other Person
based upon an Opinion of Counsel (which shall not be an expense of the Trustee)
that states that the Transfer of an Ownership Interest in a Residual Certificate
to such Person may cause any REMIC to fail to qualify as a REMIC at any time
that any Certificates are Outstanding. The terms “United States,” “State” and
“International Organization” shall have the meanings set forth in
Section 7701 of the Code or successor provisions. A corporation will not be
treated as an instrumentality of the United States or of any State or political
subdivision thereof for these purposes if all of its activities are subject
to
tax and, with the exception of Xxxxxxx Mac, a majority of its board of directors
is not selected by such government unit.
Person:
Any
individual, corporation, partnership, joint venture, association,
joint-stock
company, limited liability company, trust, unincorporated organization or
government, or any agency or political subdivision thereof.
Prepayment
Assumption:
The
assumed rate of prepayment, as described in the Prospectus Supplement relating
to each Class of Publicly Offered Certificates.
Prepayment
Charge:
With
respect to any Principal Prepayment, any prepayment premium, penalty or charge
payable by a Mortgagor in connection with any Principal Prepayment on a Mortgage
Loan pursuant to the terms of the related Mortgage Note (other than any Servicer
Prepayment Charge Payment Amount) as shown on the Prepayment Charge
Schedule.
Prepayment
Charge Schedule:
As of
any date, the list of Mortgage Loans providing for a Prepayment Charge included
in the Trust Fund on such date, attached hereto as Exhibit R (including the
prepayment charge summary attached thereto). The Depositor shall deliver or
cause the delivery of the Prepayment Charge Schedule to the Servicers, the
Master Servicer and the Trustee on the Closing Date. The Prepayment Charge
Schedule shall set forth the following information with respect to each
Prepayment Charge:
(i)
|
the
Mortgage Loan identifying number;
|
(ii)
|
a
code indicating the type of Prepayment Charge;
|
(iii)
|
the
date on which the first Monthly Payment was due on the related Mortgage
Loan;
|
(iv)
|
the
term of the related Prepayment Charge;
|
(v)
|
the
original Stated Principal Balance of the related Mortgage Loan;
and
|
(vi)
|
the
Stated Principal Balance of the related Mortgage Loan as of the Cut-off
Date.
|
Prepayment
Interest Shortfall:
With
respect to any Distribution Date, for each Mortgage Loan that was the subject
of
a Principal Prepayment in full during the related Prepayment Period, (other
than
a Principal Prepayment in full resulting from the purchase of a Mortgage Loan
pursuant to Section 2.02, 2.03, 3.24 or 10.01 hereof), the amount, if any,
by which (i) one month’s interest at the applicable Net Mortgage Rate on the
Stated Principal Balance of such Mortgage Loan immediately prior to such
prepayment exceeds (ii) the amount of interest paid or collected in connection
with such Principal Prepayment less the sum of (a) the related Servicing Fee,
(b) the Credit Risk Management Fee and (c) the fee payable to any provider
of
lender-paid mortgage insurance, if any.
Prepayment
Period:
With
respect to any Distribution Date and (i) GMACM, the 14th
day of
the immediately preceding calendar month through the 13th
day of
the month in which such Distribution Date occurs and (ii) Wachovia, the prior
calendar month.
Principal
Prepayment:
Any
Mortgagor payment or other recovery of (or proceeds with respect to) principal
on a Mortgage Loan (including Mortgage Loans purchased or repurchased under
Sections 2.02, 2.03, 3.24 and 10.01 hereof) that is received in advance of
its
scheduled Due Date and is not accompanied by an amount as to interest
representing scheduled interest due on any Due Date in any month or months
subsequent to the month of prepayment. Partial Principal Prepayments shall
be
applied by the related Servicer in accordance with the terms of the related
Mortgage Note.
Principal
Remittance Amount:
With
respect to any Distribution Date, (i) the sum, without duplication, of (a)
the
principal portion of all Scheduled Payments on the Mortgage Loans due during
the
related Due Period whether or not received on or prior to the related
Determination Date, (b) the Stated Principal Balance of each Mortgage Loan
that
was repurchased by the Sponsor during the related Prepayment Period pursuant
to
Sections 2.02, 2.03 and 3.24, (c) the aggregate of all Substitution
Adjustment Amounts received during the related Prepayment Period for the related
Determination Date in connection with the substitution of Mortgage Loans
pursuant to Section 2.03(b), (d) the principal portion of all other
unscheduled collections (other than Payaheads) including Insurance Proceeds,
Condemnation Proceeds, Liquidation Proceeds, Subsequent Recoveries and all
full
and partial Principal Prepayments exclusive of prepayment charges or penalties
collected during the related Prepayment Period, to the extent applied as
recoveries of principal on the Mortgage Loans, (e) the principal portion of
Payaheads previously received on the Mortgage Loans and intended for application
in the related Due Period, (f) amounts in respect of principal on the Mortgage
Loans paid by the Master Servicer pursuant to Section 10.01 minus (ii) all
amounts required to be reimbursed by the Trust Fund pursuant to
Sections 4.02, 4.05, 4.07 and 9.05 or as otherwise set forth in this
Agreement, the Servicing Agreement or the Custodial Agreement.
Private
Certificate:
Each of
the Class X, Class P and Residual Certificates.
Prospectus
Supplement:
The
Prospectus Supplement dated September 27, 2006 relating to the offering of
the
Publicly Offered Certificates.
Publicly
Offered Certificates:
Any
Certificates other than the Private Certificates.
PUD:
A
planned unit development.
Purchase
Price:
With
respect to any Mortgage Loan required to be repurchased by the Sponsor pursuant
to Section 2.02, 2.03 or 3.24 hereof and as confirmed by an Officer’s
Certificate from the Sponsor to the Trustee, an amount equal to the sum of
(i)
100% of the outstanding principal balance of the Mortgage Loan as of the date
of
such purchase plus, (ii) thirty (30) days’ accrued interest thereon at the
applicable Net Mortgage Rate, plus any portion of the Servicing Fee, Servicing
Advances and Advances payable to the related Servicer or Master Servicer, as
applicable, with respect to such Mortgage Loan plus (iii) any costs and damages
of the Trust Fund in connection with any violation by such Mortgage Loan of
any
abusive or predatory lending law, including any expenses incurred by the Trustee
with respect to such Mortgage Loan prior to the purchase thereof.
Rating
Agency:
Each of
Xxxxx’x and S&P. If any such organization or its successor is no longer in
existence, “Rating Agency” shall be a nationally recognized statistical rating
organization, or other comparable Person, designated by the Depositor, notice
of
which designation shall be given to the Trustee. References herein to a given
rating category of a Rating Agency shall mean such rating category without
giving effect to any modifiers.
Realized
Loss:
With
respect to each Mortgage Loan as to which a Final Recovery Determination has
been made, an amount (not less than zero) equal to (i) the Stated Principal
Balance of such Mortgage Loan as of the commencement of the calendar month
in
which the Final Recovery Determination was made, plus (ii) accrued interest
from
the Due Date as to which interest was last paid by the Mortgagor through the
end
of the calendar month in which such Final Recovery Determination was made,
calculated in the case of each calendar month during such period (A) at an
annual rate equal to the annual rate at which interest was then accruing on
such
Mortgage Loan and (B) on a principal amount equal to the Stated Principal
Balance of such Mortgage Loan as of the close of business on the Distribution
Date during such calendar month, minus (iii) the proceeds, if any, received
in
respect of such Mortgage Loan during the calendar month in which such Final
Recovery Determination was made, net of amounts that are payable therefrom
to
the Servicer pursuant to this Agreement. To the extent the Servicer receives
Subsequent Recoveries with respect to any Mortgage Loan, the amount of the
Realized Loss with respect to that Mortgage Loan will be reduced to the extent
that Subsequent Recoveries are applied to reduce the Certificate Principal
Balance of any Class of Certificates on any Distribution Date.
With
respect to any REO Property as to which a Final Recovery Determination has
been
made, an amount (not less than zero) equal to (i) the Stated Principal Balance
of the related Mortgage Loan as of the date of acquisition of such REO Property
on behalf of REMIC I, plus (ii) accrued interest from the Due Date as to which
interest was last paid by the Mortgagor in respect of the related Mortgage
Loan
through the end of the calendar month immediately preceding the calendar month
in which such REO Property was acquired, calculated in the case of each calendar
month during such period (A) at an annual rate equal to the annual rate at
which
interest was then accruing on the related Mortgage Loan and (B) on a principal
amount equal to the Stated Principal Balance of the related Mortgage Loan as
of
the close of business on the Distribution Date during such calendar month,
minus
(iii) the aggregate of all unreimbursed Advances and Servicing
Advances.
With
respect to each Mortgage Loan which has become the subject of a Deficient
Valuation, the difference between the principal balance of the Mortgage Loan
outstanding immediately prior to such Deficient Valuation and the principal
balance of the Mortgage Loan as reduced by the Deficient Valuation.
With
respect to each Mortgage Loan which has become the subject of a Debt Service
Reduction, the portion, if any, of the reduction in each affected Monthly
Payment attributable to a reduction in the Mortgage Rate imposed by a court
of
competent jurisdiction. Each such Realized Loss shall be deemed to have been
incurred on the Due Date for each affected Monthly Payment.
In
addition, to the extent the Servicer receives Subsequent Recoveries with respect
to any Mortgage Loan, the amount of the Realized Loss with respect to that
Mortgage Loan will be reduced to the extent such Subsequent Recoveries are
applied to reduce the Certificate Principal Balance of any Class of Certificates
on any Distribution Date.
Record
Date:
With
respect to the Senior Certificates and Subordinate Certificates and any
Distribution Date, so long as such Certificates are Book-Entry Certificates,
the
Business Day preceding such Distribution Date, and otherwise, the close of
business on the last Business Day of the month preceding the month in which
such
Distribution Date occurs. With respect to the Class P, Class X and Residual
Certificates and any Distribution Date, the close of business on the last
Business Day of the month preceding the month in which such Distribution Date
occurs.
Reference
Bank Rate:
With
respect to any Accrual Period shall mean the arithmetic mean, rounded upwards,
if necessary, to the nearest whole multiple of 0.03125%, of the offered rates
for United States dollar deposits for one month that are quoted by the Reference
Banks as of 11:00 a.m., New York City time, on the related Interest
Determination Date to prime banks in the London interbank market for a period
of
one month in an amount approximately equal to the aggregate Certificate
Principal Balance of the Senior Certificates and Mezzanine Certificates for
such
Accrual Period, provided that at least two such Reference Banks provide such
rate. If fewer than two offered rates appear, the Reference Bank Rate will
be
the arithmetic mean, rounded upwards, if necessary, to the nearest whole
multiple of 0.03125%, of the rates quoted by one or more major banks in New
York
City, selected by the Securities Administrator, as of 11:00 a.m., New York
City
time, on such date for loans in United States dollars to leading European banks
for a period of one month in amounts approximately equal to the aggregate
Certificate Principal Balance of the Senior Certificates and Mezzanine
Certificates for such Accrual Period.
Reference
Banks:
Shall
mean leading banks selected by the Securities Administrator and engaged in
transactions in Eurodollar deposits in the international Eurocurrency market
(i)
with an established place of business in London, (ii) which have been designated
as such by the Securities Administrator and (iii) which are not controlling,
controlled by, or under common control with, the Depositor, the Sponsor or
the
Servicer.
Regular
Certificate:
The
Senior Certificates, Mezzanine Certificates, Class X Certificates and Class
P
Certificates.
Regulation
AB:
Means
Subpart 229.1100 - Asset Backed Securities (Regulation AB), 17 C.F.R.
§§229.1100-229.1123, as such may be amended from time to time, and subject to
such clarification and interpretation as have been provided by the Commission
in
the adopting release (Asset-Backed Securities, Securities Act Release No.
33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the staff of the
Commission, or as may be provided by the Commission or its staff from time
to
time.
Relevant
Servicing Criteria:
Means
with respect to any Servicing Function Participant, the Servicing Criteria
applicable to such party, as set forth on Exhibit
L
attached
hereto. For clarification purposes, multiple parties can have responsibility
for
the same Relevant Servicing Criteria. With respect to a Servicing Function
Participant engaged by the Master Servicer, the Securities Administrator or
the
Servicer, the term “Relevant Servicing Criteria” may refer to a portion of the
Relevant Servicing Criteria applicable to such party.
Relief
Act:
The
Servicemembers Civil Relief Act of 2003, as amended from time to time or similar
state or local laws.
REMIC:
A “real
estate mortgage investment conduit” within the meaning of Section 860D of
the Code.
REMIC
I:
The
segregated pool of assets subject hereto, constituting the primary trust created
hereby and to be administered hereunder, with respect to which a REMIC election
is to be made, consisting of (i) the Mortgage Loans and all interest accruing
and principal due with respect thereto after the Cut-off Date to the extent
not
applied in computing the Cut-off Date Principal Balance thereof and all related
Prepayment Charges; (ii) the related Mortgage Files, (iii) the
Custodial Accounts (other than any amounts representing any Servicer Prepayment
Charge Payment Amount), the Distribution Account, the Class P Certificate
Account and such assets that are deposited therein from time to time, together
with any and all income, proceeds and payments with respect thereto; (iv)
property that secured a Mortgage Loan and has been acquired by foreclosure,
deed
in lieu of foreclosure or otherwise; (v) the mortgagee’s rights under the
Insurance Policies with respect to the Mortgage Loans; (vi) the rights under
the
Mortgage Loan Purchase Agreement, and (vii) all proceeds of the foregoing,
including proceeds of conversion, voluntary or involuntary, of any of the
foregoing into cash or other liquid property. Notwithstanding
the foregoing, however, REMIC I specifically excludes (i) all payments and
other
collections of principal and interest due on the Mortgage Loans on or before
the
Cut-off Date, (ii) all Prepayment Charges payable in connection with Principal
Prepayments on the Mortgage Loans made before the Cut-off Date, (iii) the Basis
Risk Shortfall Reserve Fund, (iv) the Swap Agreement and (v) the Supplemental
Interest Trust.
REMIC
I Regular Interest:
Any of
the separate non-certificated beneficial ownership interests in REMIC I issued
hereunder and designated as a “regular interest” in REMIC I. Each REMIC I
Regular Interest shall accrue interest at the related Uncertificated REMIC
I
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto. The designations for the respective
REMIC I Regular Interests are set forth in the Preliminary Statement
hereto.
REMIC
II:
The
segregated pool of assets consisting of all of the REMIC I Regular Interests
conveyed in trust to the Trustee, for the benefit of the Holders of the REMIC
II
Regular Interests and the Holders of the Class R Certificates (as holders of
the
Class R-3 Interest), pursuant to Article II hereunder, and all amounts deposited
therein, with respect to which a separate REMIC election is to be
made.
REMIC
II Interest Loss Allocation Amount:
With
respect to any Distribution Date, an amount equal to (a) the product of (i)
the
aggregate Stated Principal Balance of the Mortgage Loans and related REO
Properties then outstanding and (ii) the Uncertificated REMIC II Pass-Through
Rate for REMIC II Regular Interest LT-AA minus the Marker Rate, divided by
(b)
12.
REMIC
II Overcollateralization Amount:
With
respect to any date of determination, (i) the aggregate Uncertificated Principal
Balances of the REMIC II Regular Interests minus (ii) the aggregate of the
Uncertificated Principal Balances of REMIC II Regular Interest LT-A1A, REMIC
II
Regular Interest LT-A1B, REMIC II Regular Interest LT-A2, REMIC II Regular
Interest LT-A3A, REMIC II Regular Interest LT-A3B, REMIC II Regular Interest
LT-A4A, REMIC II Regular Interest LT-A4B, REMIC II Regular Interest LT-M1,
REMIC
II Regular Interest LT-M2, REMIC II Regular Interest LT-M3, REMIC II Regular
Interest LT-M4 and REMIC II Regular Interest LT-M5, in each case as of such
date
of determination.
REMIC
II Principal Loss Allocation Amount:
With
respect to any Distribution Date, an amount equal to (a) the product of (i)
the
aggregate Stated Principal Balance of the Mortgage Loans and related REO
Properties then outstanding and (ii) 1 minus a fraction, the numerator of which
is two times the aggregate of the Uncertificated Principal Balances of REMIC
II
Regular Interest LT-A1A, REMIC II Regular Interest LT-A1B, REMIC II Regular
Interest LT-A2, REMIC II Regular Interest LT-A3A, REMIC II Regular Interest
LT-A3B, REMIC II Regular Interest LT-A4A, REMIC II Regular Interest LT-A4B,
REMIC II Regular Interest LT-M1, REMIC II Regular Interest LT-M2, REMIC II
Regular Interest LT-M3, REMIC II Regular Interest LT-M4 and REMIC II Regular
Interest LT-M5 and the denominator of which is the aggregate of the
Uncertificated Principal Balances of REMIC II Regular Interest LT-A1A, REMIC
II
Regular Interest LT-A1B, REMIC II Regular Interest LT-A2, REMIC II Regular
Interest LT-A3A, REMIC II Regular Interest LT-A3B, REMIC II Regular Interest
LT-A4A, REMIC II Regular Interest LT-A4B, REMIC II Regular Interest LT-M1,
REMIC
II Regular Interest LT-M2, REMIC II Regular Interest LT-M3, REMIC II Regular
Interest LT-M4, REMIC II Regular Interest LT-M5 and REMIC II Regular Interest
LT-ZZ.
REMIC
II Regular Interests:
REMIC
II Regular Interest LT-A1A, REMIC II Regular Interest LT-A1B, REMIC II Regular
Interest LT-A2, REMIC II Regular Interest LT-A3A, REMIC II Regular Interest
LT-A3B, REMIC II Regular Interest LT-A4A, REMIC II Regular Interest LT-A4B,
REMIC II Regular Interest LT-M1, REMIC II Regular Interest LT-M2, REMIC II
Regular Interest LT-M3, REMIC II Regular Interest LT-M4, REMIC II Regular
Interest LT-M5, REMIC II Regular Interest LT-ZZ, REMIC II Regular Interest
LTII-P and REMIC II Regular Interest LT-IO.
REMIC
II Regular Interest LT-AA:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-AA shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-A1A:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Xxxxxxxx XX-X0X shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-A1B:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-A1B shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-A2:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Xxxxxxxx XX-X0 shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-A3A:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Xxxxxxxx XX-X0X shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-A3B:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-A3B shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-A4A:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Xxxxxxxx XX-X0X shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-A4B:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-A4B shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-IO:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-IO shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time.
REMIC
II Regular Interest LT-M1:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-M1 shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-M2:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-M2 shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-M3:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-M3 shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-M4:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-M4 shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-M5:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-M5 shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LTII-P:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LTII-P shall be entitled to distributions of principal, subject to
the
terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.
REMIC
II Regular Interest LT-ZZ:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest LT-ZZ shall accrue interest at the related Uncertificated REMIC II
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as set
forth in the Preliminary Statement hereto.
REMIC
II Regular Interest LT-ZZ Maximum Interest Deferral Amount:
With
respect to any Distribution Date, the excess of (i) accrued interest at the
Uncertificated REMIC II Pass-Through Rate applicable to REMIC II Regular
Interest LT-ZZ for such Distribution Date on a balance equal to the
Uncertificated Principal Balance of REMIC II Regular Interest LT-ZZ minus the
REMIC II Overcollateralization Amount, in each case for such Distribution Date,
over (ii) the Uncertificated Accrued Interest on REMIC II Regular Interest
LT-A1A, REMIC II Regular Interest LT-A1B, REMIC II Regular Interest LT-A2,
REMIC
II Regular Interest LT-A3A, REMIC II Regular Interest LT-A3B, REMIC II Regular
Interest LT-A4A, REMIC II Regular Interest LT-A4B, REMIC II Regular Interest
LT-M1, REMIC II Regular Interest LT-M2, REMIC II Regular Interest LT-M3, REMIC
II Regular Interest LT-M4 and REMIC II Regular Interest LT-M5 for such
Distribution Date, with the rate on each such REMIC II Regular Interest subject
to a cap equal to the related Pass-Through Rate.
REMIC
II Targeted Overcollateralization Amount:
1.00%
of the Targeted Overcollateralization Amount.
REMIC
III:
The
segregated pool of assets consisting of all of the REMIC II Regular Interests
conveyed in trust to the Trustee, for the benefit of the REMIC III
Certificateholders pursuant to Section 2.07, and all amounts deposited
therein, with respect to which a separate REMIC election is to be
made.
REMIC
III Regular Interest:
Any of
the Class X Interest, Class P Interest, Class IO Interest, and any “regular
interest” in REMIC III the ownership of which is represented by a Senior
Certificate or Mezzanine Certificate.
REMIC
III Certificate:
Any
Senior Certificate, Mezzanine Certificate or Class R Certificate.
REMIC
III Certificateholder:
The
Holder of any REMIC III Certificate.
REMIC
IV:
The
segregated pool of assets consisting of all of the Class X Interest conveyed
in
trust to the Trustee, for the benefit of the Holders of the Class X Certificates
and the Holders of the Class R-X Certificates (as Holders of the Class R-4
Interest), pursuant to Section 2.07 hereunder, and all amounts deposited
therein, with respect to which a separate REMIC election is to be
made.
REMIC
V:
The
segregated pool of assets consisting of all of the Class P Interest conveyed
in
trust to the Trustee, for the benefit of the Holders of the Class P Certificates
and the Holders of the Class R-X Certificates (as Holders of the Class R-5
Interest), pursuant to Section 2.07 hereunder, and all amounts deposited
therein, with respect to which a separate REMIC election is to be
made.
REMIC
VI:
The
segregated pool of assets consisting of all of the Class IO Interest conveyed
in
trust to the Trustee, for the benefit of the Holders of REMIC VI Regular
Interest IO and the Holders of the Class R-X Certificates (as Holders of the
Class R-6 Interest), pursuant to Section 2.07, and all amounts deposited
therein, with respect to which a separate REMIC election is to be
made.
REMIC
VI Regular Interest IO:
An
uncertificated interest in the Trust Fund held by the Trustee, evidencing a
Regular Interest in REMIC VI for purposes of the REMIC Provisions.
REMIC
Opinion:
Shall
mean an Opinion of Counsel to the effect that the proposed action will not
have
an adverse affect on any REMIC created hereunder.
REMIC
Provisions:
Provisions of the federal income tax law relating to real estate mortgage
investment conduits, which appear at Sections 860A through 860G of Subchapter
M
of Chapter 1 of the Code, and related provisions, and proposed, temporary and
final regulations and published rulings, notices and announcements promulgated
thereunder, as the foregoing may be in effect from time to time as well as
provisions of applicable state laws.
REMIC
Regular Interest:
Any
REMIC I Regular Interest, REMIC II Regular Interest, REMIC III Regular Interest
or a Regular Certificate.
Remittance
Date:
Shall
mean the eighteenth (18th)
day of
the month and if such day is not a Business Day, the immediately preceding
Business Day.
REO
Property:
A
Mortgaged Property acquired by the Servicer through foreclosure or deed-in-lieu
of foreclosure in connection with a defaulted Mortgage Loan.
Replacement
Mortgage Loan:
A
Mortgage Loan or Mortgage Loans in the aggregate substituted by the Sponsor
for
a Deleted Mortgage Loan, which must, on the date of such substitution, as
confirmed in a request for release in accordance with the terms of the Custodial
Agreement, (i) have a Stated Principal Balance, after deduction of the principal
portion of the Scheduled Payment due in the month of substitution, not in excess
of, and not less than 90% of, the Stated Principal Balance of the Deleted
Mortgage Loan; (ii) (a) with respect to a Group I Mortgage Loan, have a fixed
Mortgage Rate not less than or more than 1% per annum higher than the Mortgage
Rate of the Deleted Mortgage Loan or (b) with respect to a Group II-IV Mortgage
Loan or Group V Mortgage Loan, have an adjustable Mortgage Rate not less than
or
more than 1% per annum higher than the Mortgage Rate of the Deleted Mortgage
Loan; (iii) have the same or higher credit quality characteristics than that
of
the Deleted Mortgage Loan; (iv) have a Loan-to-Value Ratio no higher than that
of the Deleted Mortgage Loan; (v) have a remaining term to maturity no greater
than (and not more than one year less than) that of the Deleted Mortgage Loan;
(vi) be secured by a first lien on the related Mortgaged Property; (vii)
constitute the same occupancy type as the Deleted Mortgage Loan or be owner
occupied; (viii) have a Maximum Mortgage Interest Rate not less than the Maximum
Mortgage Interest Rate on the Deleted Loan; (ix) have a Minimum Mortgage
Interest Rate not less than the Minimum Mortgage Interest Rate of the Deleted
Loan; (x) have a Gross Margin equal to the Gross Margin of the Deleted Loan;
(xi) have a next Adjustment Date not more than two months later than the next
Adjustment Date on the Deleted Loan; and (xii) comply with each representation
and warranty set forth in the Mortgage Loan Purchase Agreement.
Reportable
Event:
Has the
meaning set forth in Section 5.17(b) of this Agreement.
Reporting
Servicer:
Shall
mean any Servicer, the Master Servicer, the Securities Administrator, the
Custodian under the Custodial Agreement, and any Servicing Function Participant
engaged by such parties.
Required
Insurance Policy:
With
respect to any Mortgage Loan, any insurance policy that is required to be
maintained from time to time under this Agreement.
Residual
Certificates:
The
Class R Certificates and Class R-X Certificates.
Responsible
Officer:
With
respect to the Trustee and the Securities Administrator, any Vice President,
any
Assistant Vice President, the Secretary, any Assistant Secretary, any Trust
Officer, any other officer customarily performing functions similar to those
performed by any of the above designated officers or other officers of the
Trustee or the Securities Administrator specified by the Trustee or the
Securities Administrator, as the case may be, having direct responsibility
over
this Agreement and customarily performing functions similar to those performed
by any one of the designated officers, as 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.
Responsible
Party:
The
party indicated on Exhibit N as the entity primarily responsible for reporting
the information set forth therein to the Securities Administrator pursuant
to
Section 5.12.
Rolling
Three Month Delinquency Rate:
With
respect to any Distribution Date will be the fraction, expressed as a
percentage, equal to the average of the Delinquency Rates for each of the three
(or one and two, in the case of the first and second Distribution Dates)
immediately preceding months.
S&P:
Standard & Poor’s, a division of The XxXxxx-Xxxx Companies, Inc. or its
successor in interest.
Xxxxxxxx-Xxxxx
Act:
Means
the Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations of the Commission
promulgated thereunder (including any interpretations thereof by the
Commission’s staff).
Xxxxxxxx-Xxxxx
Certification:
A
written certification signed by an officer of the Master Servicer that complies
with (i) the Xxxxxxxx-Xxxxx Act of 2002, as amended from time to time, and
(ii)
Exchange Act Rules 13a-14(d) and 15d-14(d), as in effect from time to time;
provided that if, after the Closing Date (a) the Xxxxxxxx-Xxxxx Act of 2002
is
amended, (b) the Rules referred to in clause (ii) are modified or superseded
by
any subsequent statement, rule or regulation of the Commission or any statement
of a division thereof, or (c) any future releases, rules and regulations are
published by the Commission from time to time pursuant to the Xxxxxxxx-Xxxxx
Act
of 2002, which in any such case affects the form or substance of the required
certification and results in the required certification being, in the reasonable
judgment of the Master Servicer, materially more onerous than the form of the
required certification as of the Closing Date, the Xxxxxxxx-Xxxxx Certification
shall be as agreed to by the Master Servicer, the Depositor and the Seller
following a negotiation in good faith to determine how to comply with any such
new requirements.
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.
Securities
Act:
The
Securities Act of 1933, as amended, and the rules and regulations promulgated
thereunder.
Securities
Administrator:
As of
the Closing Date, Xxxxx Fargo Bank, N.A. and thereafter, its respective
successors in interest that meet the qualifications of this Agreement. The
Securities Administrator and the Master Servicer shall at all times be the
same
Person or Affiliates.
Senior
Enhancement Percentage”
With
respect to any Distribution Date will be the fraction, expressed as a
percentage, the numerator of which is the sum of the aggregate Certificate
Principal Balance of the Mezzanine Certificates and the Overcollateralization
Amount, in each case after giving effect to payments on such Distribution Date,
and the denominator of which is the Aggregate Loan Balance for such Distribution
Date.
Senior
Principal Payment Amount:
With
respect to any Distribution Date on or after the Stepdown Date and as long
as a
Trigger Event is not in effect with respect to such Distribution Date, the
amount, if any, by which (x) the Certificate Principal Balances of the Senior
Certificates, in each case, immediately prior to such Distribution Date exceed
(y) the lesser of (A) the product of (i) 87.40% and (ii) the Aggregate Loan
Balance for such Distribution Date and (B) the amount, if any, by which (i)
the
Aggregate Loan Balance for such Distribution Date exceeds (ii) 0.35% of the
Aggregate Loan Balance as of the Cut-off Date.
Senior
Sequential Allocation Percentage:
With
respect to any Distribution Date, a fraction, expressed as a percentage, the
numerator of which is the sum of the Certificate Principal Balances of the
Class
A-2, Class A-3A, Class A-3B, Class A-4A and Class A-4B Certificates and the
denominator of which is the aggregate Certificate Principal Balance of all
of
the Senior Certificates, in each case immediately prior to such Distribution
Date.
Sequential
Trigger Event:
Is in
effect on any Distribution Date if (i) before the 37th Distribution Date
following the Closing Date, the aggregate amount of Realized Losses incurred
during the period from the Cut-off Date through the last day of the related
Due
Period divided by the Aggregate Loan Balance as of the Cut-off Date exceeds
0.60%, or (ii) on or after the 37th Distribution Date following the Closing
Date, a Trigger Event is in effect.
Servicer:
Shall
mean either GMAC or Wachovia or any successor thereto appointed hereunder or
under the Servicing Agreement in connection with the servicing and
administration of the related Mortgage Loans.
Servicer
Default:
As
defined in Section 8.01.
Servicer
Prepayment Charge Payment Amount:
The
amount payable by a Servicer in respect of any waived Prepayment Charges
pursuant to Section 3.01 or pursuant to the Servicing
Agreement.
Servicer’s
Assignee:
As
defined in Section 5.01(b)(ii)
Service(s)(ing):
Means,
in accordance with Regulation AB, the act of servicing and administering the
Mortgage Loans or any other assets of the Trust Fund by an entity that meets
the
definition of “servicer’ set forth in Item 1101 of Regulation AB and is subject
to the disclosure requirements set forth in 1108 of Regulation AB. For
clarification purposes, any uncapitalized occurrence of this term shall have
the
meaning commonly understood by participants in the residential mortgage-backed
securitization market.
Servicing
Advances:
All
customary, reasonable and necessary “out of pocket” costs and expenses
(including reasonable legal fees) incurred in the performance by a Servicer
of
its servicing obligations hereunder or under the Servicing Agreement, as
applicable, including, but not limited to, the cost of (i) the preservation,
restoration, inspection, valuation and protection of a Mortgaged Property,
(ii)
any enforcement or judicial proceedings, including foreclosures, and including
any expenses incurred in relation to any such proceedings that result from
the
Mortgage Loan being registered in the MERS® System, (iii) the management and
liquidation of any REO Property (including, without limitation, realtor’s
commissions), (iv) compliance with any obligations under Section 3.07
hereof to cause insurance to be maintained and (v) payment of
taxes.
Servicing
Agreement:
The
Seller’s Purchase, Warranties and Servicing Agreement, dated as of March 1,
2006, between the Sponsor and Wachovia (as modified pursuant to the Assignment
Agreement).
Servicing
Criteria:
Means
the criteria set forth in paragraph (d) of Item 1122 of Regulation AB, as such
may be amended from time to time.
Servicing
Fee:
As to
each Mortgage Loan and any Distribution Date, an amount equal to 1/12th of
the
Servicing Fee Rate multiplied by the Stated Principal Balance of such Mortgage
Loan as of the last day of the related Due Period or, in the event of any
payment of interest that accompanies a Principal Prepayment in full during
the
related Due Period made by the Mortgagor immediately prior to such prepayment,
interest at the Servicing Fee Rate on the same Stated Principal Balance of
such
Mortgage Loan used to calculate the payment of interest on such Mortgage
Loan.
Servicing
Fee Rate:
The fee
rate for each Mortgage Loan as set forth in the Mortgage Loan
Schedule.
Servicing
Function Participant:
Means
any Subservicer or Subcontractor of each Servicer, the Master Servicer and
the
Securities Administrator, the Custodian, respectively. For purposes of Section
5.18(d), such term also shall include each Servicer, the Master Servicer, the
Securities Administrator and the Custodian, without regard to any threshold
reference therein.
Servicing
Officer:
Any
officer of a Servicer involved in, or responsible for, the administration and
the servicing of the related Mortgage Loans, whose name and specimen signature
appear on a list of Servicing Officers furnished to the Master Servicer, the
Securities Administrator the Trustee and the Depositor on the Closing Date,
as
such list may from time to time be amended.
Six-Month
LIBOR:
The per
annum rate equal to the average of interbank offered rates for Six-Month U.S.
dollar-denominated deposits in the London market based on quotations of major
banks as published in The Wall Street Journal and most recently available as
of
the time specified in the related Mortgage Note.
Sponsor:
Nomura
Credit & Capital, Inc., a Delaware corporation, and its successors and
assigns, in its capacity as seller of the Mortgage Loans to the
Depositor.
Startup
Day:
The
Startup Day for each REMIC formed hereunder shall be the Closing
Date.
Stated
Principal Balance:
With
respect to any Mortgage Loan or related REO Property and any Distribution Date,
the Cut-off Date Principal Balance thereof minus the sum of (i) the principal
portion of the Scheduled Payments due with respect to such Mortgage Loan during
each Due Period ending prior to such Distribution Date (and irrespective of
any
delinquency in their payment), (ii) all Principal Prepayments with respect
to
such Mortgage Loan received prior to or during the related Prepayment Period,
and all Liquidation Proceeds to the extent applied by the related Servicer
as
recoveries of principal in accordance with Section 3.09 of this Agreement
or pursuant to the Servicing Agreement with respect to such Mortgage Loan,
that
were received by the Servicer as of the close of business on the last day of
the
Prepayment Period related to such Distribution Date and (iii) any Realized
Losses on such Mortgage Loan incurred during the related Prepayment Period.
The
Stated Principal Balance of a Liquidated Loan equals zero.
Stepdown
Date:
The
earlier to occur of (i) the Distribution Date on which the aggregate Certificate
Principal Balance of the Senior Certificates has been reduced to zero and (ii)
the later to occur of (x) the Distribution Date in October 2009 and (y) the
first Distribution Date on which the Senior Enhancement Percentage (calculated
for this purpose only after taking into account distributions of principal
on
the Mortgage Loans, but prior to any distributions to the holders of the Senior
Certificates and Mezzanine Certificates then entitled to distributions of
principal on such Distribution Date) is greater than or equal to approximately
12.60%.
Subcontractor:
Shall
mean any vendor, subcontractor or other Person who is not responsible for the
overall servicing of Mortgage Loans but performs one or more discrete functions
identified in Item 1122(d) of Regulation AB with respect to Mortgage Loans
under
the direction or authority of a Servicer (or a Subservicer of a Servicer),
the
Master Servicer, the Trustee, the Custodian or the Securities Administrator
and
each subcontractor is determined by the Person engaging the subcontractor to
be
“participating in the servicing function” within the meaning of Item 1122 of
Regulation AB.
Subsequent
Recoveries:
Shall
mean all amounts in respect of principal received by the related Servicer (net
of reimbursable expenses) on a Mortgage Loan for which a Realized Loss was
previously incurred after the liquidation or disposition of such Mortgage
Loan.
Subservicer:
Shall
mean any Person who is identified in Item 1122(d) of Regulation AB that services
the related Mortgage Loans on behalf of a Servicer or is engaged by the Master
Servicer, the Securities Administrator or the Custodian and is responsible
for
the performance (whether directly or through subservicers or Subcontractors)
of
a substantial portion of the material servicing functions required to be
performed by such Person under this Agreement, the Servicing Agreement or any
subservicing agreement.
Subservicing
Agreement:
Any
agreement entered into between a Servicer and a Subservicer with respect to
the
subservicing of any Mortgage Loan subject to Section 3.03 of this Agreement
or
the Servicing Agreement by such Subservicer.
Substitution
Adjustment Amount:
The
meaning ascribed to such term pursuant to Section 2.03(d).
Successor
Servicer:
Any
successor to a Servicer appointed pursuant to Section 8.02 of this
Agreement or pursuant to the Servicing Agreement after the occurrence of a
Servicer Default or upon the resignation of a Servicer pursuant to this
Agreement or pursuant to the Servicing Agreement.
Supplemental
Interest Trust:
The
corpus of a trust created pursuant to Section 5.15 of this Agreement and
designated as the “Supplemental Interest Trust,” consisting of the Swap
Agreement, REMIC IV Regular Interest Swap-IO and
the
right to receive payments in respect of the Class IO Distribution Amount. For
the avoidance of doubt, the Supplemental Interest Trust does not constitute
a
part of the Trust Fund.
Swap
Agreement:
The
interest rate swap agreement, dated September 29, 2006, between HSBC Bank USA,
National Association, as trustee on behalf of the Supplemental Interest Trust,
and the Swap Provider, which agreement provides for Net Swap Trust Payments
and
Swap Termination Payments to be paid, as provided therein, together with any
schedules, confirmations or other agreements relating thereto, attached hereto
as Exhibit
P.
Swap
LIBOR:
LIBOR
as determined pursuant to the Swap Agreement.
Swap
Provider:
The
swap provider under the Swap Agreement either (a) entitled to receive payments
from the Supplemental Interest Trust or (b) required to make payments to the
Supplemental Interest Trust, in either case pursuant to the terms of the Swap
Agreement, and any successor in interest or assign. Initially, the Swap Provider
shall be ABN AMRO Bank N.V.
Swap
Provider Trigger Event:
A Swap
Provider Trigger Event shall have occurred if any of an Event of Default (under
the Swap Agreement) with respect to which the Swap Provider is a Defaulting
Party, a Termination Event (under the Swap Agreement) with respect to which
the
Swap Provider is the sole Affected Party or an Additional Termination Event
(under the Swap Agreement) with respect to which the Swap Provider is the sole
Affected Party has occurred.
Swap
Termination Payment:
Upon
the designation of an “Early Termination Date” as defined in the Swap Agreement,
the payment to be made by the Supplemental Interest Trust to the Swap Provider,
or by the Swap Provider to the Supplemental Interest Trust, as applicable,
pursuant to the terms of the Swap Agreement.
Targeted
Overcollateralization Amount:
With
respect to any Distribution Date prior to the Stepdown Date, approximately
0.80%
of the Aggregate Loan Balance as of the Cut-off Date; with respect to any
Distribution Date on or after the Stepdown Date and with respect to which a
Trigger Event is not in effect, the greater of (a) 1.60% of the Aggregate Loan
Balance for such Distribution Date, or (b) 0.35% of the Aggregate Loan Balance
as of the Cut-off Date; with respect to any Distribution Date on or after the
Stepdown Date with respect to which a Trigger Event is in effect, the Targeted
Overcollateralization Amount for such Distribution Date will be equal to the
Targeted Overcollateralization Amount for the Distribution Date immediately
preceding such Distribution Date. Notwithstanding the foregoing, on and after
any Distribution Date following the reduction of the aggregate Certificate
Principal Balance of the Senior Certificates and Mezzanine Certificates to
zero,
the Targeted Overcollateralization Amount shall be zero.
Tax
Matters Person:
The
person designated as “tax matters person” in the manner provided under Treasury
regulation § 1.860F-4(d) and temporary Treasury regulation
§ 301.6231(a)(7)-1T. The holder of the greatest Percentage Interest in a
Class of Residual Certificates shall be the Tax Matters Person for the related
REMIC. The Securities Administrator, or any successor thereto or assignee
thereof shall serve as tax administrator hereunder and as agent for the related
Tax Matters Person.
Termination
Price:
The
price, calculated as set forth in Section 10.01, to be paid in connection
with the purchase of the Mortgage Loans and REO Properties pursuant to
Section 10.01.
Transaction
Party:
Shall
mean the Depositor, the Sponsor, the Trustee, the Servicers, the Master
Servicer, the Securities Administrator, the Custodian and the Swap
Provider.
Transfer
Affidavit:
As
defined in Section 6.02(c).
Transfer:
Any
direct or indirect transfer or sale of any Ownership Interest in a
Certificate.
Trigger
Event:
With
respect to any Distribution Date, a Trigger Event is in effect if either (i)
the
Rolling Three Month Delinquency Rate as of the last day of the related Due
Period equals or exceeds approximately 40.00% of the Senior Enhancement
Percentage for such Distribution Date or (ii) the cumulative Realized Losses
as
a percentage of the original Aggregate Loan Balance on the Closing Date for
such
Distribution Date is greater than the applicable percentages set forth below
with respect to such Distribution Date.
Distribution
Date
|
Percentage
|
October
2008 to September 2009
|
0.25%*
|
October
2009 to September 2010
|
0.60%*
|
October
2010 to September 2011
|
1.05%*
|
October
2011 to September 2012
|
1.50%*
|
October
2012 and thereafter
|
1.80%
|
*The
cumulative loss percentages set forth above are applicable to the first
Distribution Date in the corresponding range of Distribution Dates. The
cumulative loss percentage for each succeeding Distribution Date in a range
increases incrementally by 1/12 of the positive difference between the
percentage applicable to the first Distribution Date in that range and the
percentage applicable to the first Distribution Date in the succeeding
range.
Trust
Fund:
Collectively, the assets of REMIC I, REMIC II, REMIC III, REMIC IV, REMIC V,
REMIC VI and the Basis Risk Shortfall Reserve Fund. For the avoidance of doubt,
the Trust Fund does not include the Supplemental Interest Trust.
Trustee:
HSBC
Bank USA, National Association, a national banking association, not in its
individual capacity, but solely in its capacity as trustee for the benefit
of
the Certificateholders under this Agreement, and any successor thereto, and
any
corporation or national banking association resulting from or surviving any
consolidation or merger to which it or its successors may be a party and any
successor trustee as may from time to time be serving as successor trustee
hereunder.
Uncertificated
Accrued Interest:
With
respect to each Uncertificated REMIC Regular Interest on each Distribution
Date,
an amount equal to one month’s interest at the related Uncertificated
Pass-Through Rate on the Uncertificated Principal Balance of such REMIC Regular
Interest. In each case, Uncertificated Accrued Interest will be reduced by
any
Prepayment Interest Shortfalls and shortfalls resulting from application of
the
Relief Act (allocated to such REMIC Regular Interests as set forth in Sections
1.02, 5.07, 5.08 and 5.09).
Uncertificated
Notional Amount:
With
respect to REMIC II Regular Interest LT-IO and each Distribution Date listed
below, the aggregate Uncertificated Principal Balance of the REMIC I Regular
Interests ending with the designation “A” listed below:
Uncertificated
Notional Amount:
With
respect to REMIC II Regular Interest LT-IO and each Distribution Date listed
below, the aggregate Uncertificated Principal Balance of the REMIC I Regular
Interests ending with the designation “A” listed below:
Distribution
Date
|
REMIC
IIIA Regular Interests
|
1
|
I-1-A
through X-00-X
|
0
|
X-0-X
xxxxxxx X-00-X
|
0
|
X-0-X
through X-00-X
|
0
|
X-0-X
xxxxxxx X-00-X
|
0
|
X-0-X
through X-00-X
|
0
|
X-0-X
xxxxxxx X-00-X
|
0
|
X-0-X
through X-00-X
|
0
|
X-0-X
xxxxxxx X-00-X
|
0
|
X-0-X
through I-60-A
|
10
|
I-10-A
through I-60-A
|
11
|
I-11-A
through I-60-A
|
12
|
I-12-A
through I-60-A
|
13
|
I-13-A
through I-60-A
|
14
|
I-14-A
through I-60-A
|
15
|
I-15-A
through I-60-A
|
16
|
I-16-A
through I-60-A
|
17
|
I-17-A
through I-60-A
|
18
|
I-18-A
through I-60-A
|
19
|
I-19-A
through I-60-A
|
20
|
I-20-A
through I-60-A
|
21
|
I-21-A
through I-60-A
|
22
|
I-22-A
through I-60-A
|
23
|
I-23-A
through I-60-A
|
24
|
I-24-A
through I-60-A
|
25
|
I-25-A
through I-60-A
|
26
|
I-26-A
through I-60-A
|
27
|
I-27-A
through I-60-A
|
28
|
I-28-A
through I-60-A
|
29
|
I-29-A
through I-60-A
|
30
|
I-30-A
through I-60-A
|
31
|
I-31-A
through I-60-A
|
32
|
I-32-A
through I-60-A
|
33
|
I-33-A
through I-60-A
|
34
|
I-34-A
through I-60-A
|
35
|
I-35-A
through I-60-A
|
36
|
I-36-A
through I-60-A
|
37
|
I-37-A
through I-60-A
|
38
|
I-38-A
through I-60-A
|
39
|
I-39-A
through I-60-A
|
40
|
I-40-A
through I-60-A
|
41
|
I-41-A
through I-60-A
|
42
|
I-42-A
through I-60-A
|
43
|
I-43-A
through I-60-A
|
44
|
I-44-A
through I-60-A
|
45
|
I-45-A
through I-60-A
|
46
|
I-46-A
through I-60-A
|
47
|
I-47-A
through I-60-A
|
48
|
I-48-A
through I-60-A
|
49
|
I-49-A
through I-60-A
|
50
|
I-50-A
through I-60-A
|
51
|
I-51-A
through I-60-A
|
52
|
I-52-A
through I-60-A
|
53
|
I-53-A
through I-60-A
|
54
|
I-54-A
through I-60-A
|
55
|
I-55-A
through I-60-A
|
56
|
I-56-A
through I-60-A
|
57
|
I-57-A
through I-60-A
|
58
|
I-58-A
through I-60-A
|
59
|
I-59-A
and I-60-A
|
60
|
I-60-A
|
thereafter
|
$0.00
|
With
respect to the Class IO Interest and any Distribution Date, an amount equal
to
the Uncertificated Notional Amount of the REMIC II Regular Interest
LT-IO.
Uncertificated
Principal Balance:
With
respect to each REMIC Regular Interest, the principal amount of such REMIC
Regular Interest outstanding as of any date of determination. As of the Closing
Date, the Uncertificated Principal Balance of each REMIC Regular Interest shall
equal the amount set forth in the Preliminary Statement hereto as its initial
Uncertificated Principal Balance. On each Distribution Date, the Uncertificated
Principal Balance of each REMIC Regular Interest shall be reduced by all
distributions of principal made on such REMIC Regular Interest on such
Distribution Date pursuant to Section 5.07 and, if and to the extent necessary
and appropriate, shall be further reduced on such Distribution Date by Realized
Losses as provided in Section 5.07. The Uncertificated Principal Balance of
each
REMIC Regular Interest shall never be less than zero.
Uncertificated
REMIC I Pass-Through Rate:
With
respect to REMIC I Regular Interest I, a per annum rate equal to the weighted
average Net Mortgage Rate of the Mortgage Loans. With respect to each REMIC
I
Regular Interest ending with the designation “A”, a per annum rate equal to the
weighted average Net Mortgage Rate of the Mortgage Loans multiplied by 2,
subject to a maximum rate of 10.58%. With respect to each REMIC I Regular
Interest ending with the designation “B”, the greater of (x) a per annum rate
equal to the excess, if any, of (i) 2 multiplied by the weighted average Net
Mortgage Rate of the Mortgage Loans over (ii) 10.58% and (y) 0.00%.
Uncertificated
REMIC II Pass-Through Rate:
With
respect to REMIC II Regular Interest LT-AA, REMIC II Regular Interest LT-A1A,
REMIC II Regular Interest LT-A1B, REMIC II Regular Interest LT-A2, REMIC II
Regular Interest LT-A3A, REMIC II Regular Interest LT-A3B, REMIC II Regular
Interest LT-A4A, REMIC II Regular Interest LT-A4B, REMIC II Regular Interest
LT-M1, REMIC II Regular Interest LT-M2, REMIC II Regular Interest LT-M3, REMIC
II Regular Interest LT-M4, REMIC II Regular Interest LT-M5 and REMIC II Regular
Interest LT-ZZ, a
per
annum rate (but not less than zero) equal to the weighted average of (w) with
respect to REMIC I Regular Interest I, the Uncertificated REMIC I Pass-Through
Rate for such REMIC I Regular Interest for each such Distribution Date, (x)
with
respect to REMIC I Regular Interests ending with the designation “B”, the
weighted average of the Uncertificated REMIC I Pass-Through Rate for such REMIC
I Regular Interests, weighted on the basis of the Uncertificated Principal
Balance of such REMIC I Regular Interests for each such Distribution Date and
(y) with respect to REMIC I Regular Interests ending with the designation “A”,
for each Distribution Date listed below, the weighted average of the rates
listed below for each such REMIC I Regular Interest listed below, weighted
on
the basis of the Uncertificated Principal Balance of each such REMIC I Regular
Interest for each such Distribution Date:
Distribution
Date
|
REMIC
I Regular Interest
|
Rate
|
1
|
I-1-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
2
|
I-2-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
3
|
I-3-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
and I-2-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
4
|
I-4-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-3-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
5
|
I-5-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-4-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
6
|
I-6-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-5-A
|
Uncertificated
REMIC IIIA Pass-Through Rate
|
|
7
|
I-7-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-6-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
8
|
I-8-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-7-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
9
|
I-9-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-8-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
10
|
I-10-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-9-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
11
|
I-11-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-10-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
12
|
I-12-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-11-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
13
|
I-13-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-12-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
14
|
I-14-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-13-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
15
|
I-15-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-14-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
16
|
I-16-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-15-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
17
|
I-17-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-16-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
18
|
I-18-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-17-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
19
|
I-19-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-18-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
20
|
I-20-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-19-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
21
|
I-21-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-20-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
22
|
I-22-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-21-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
23
|
I-23-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-22-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
24
|
I-24-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-23-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
25
|
I-25-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-24-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
26
|
I-26-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-25-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
27
|
I-27-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-26-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
28
|
I-28-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-27-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
29
|
I-29-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-28-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
30
|
I-30-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-29-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
31
|
I-31-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-30-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
32
|
I-32-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-31-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
33
|
I-33-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-32-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
34
|
I-34-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-33-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
35
|
I-35-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-34-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
36
|
I-36-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-35-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
37
|
I-37-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-36-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
38
|
I-38-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-37-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
39
|
I-39-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-38-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
40
|
I-40-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-39-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
41
|
I-41-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-40-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
42
|
I-42-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-41-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
43
|
I-43-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-42-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
44
|
I-44-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-43-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
45
|
I-45-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-44-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
46
|
I-46-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-45-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
47
|
I-47-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-46-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
48
|
I-48-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-47-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
49
|
I-49-A
and I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-48-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
50
|
I-50-A
and I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-49-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
51
|
I-51-A
and I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-50-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
52
|
I-52-A
and I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-51-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
53
|
I-53-A
and I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-52-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
54
|
I-54-A
and I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-53-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
55
|
I-55-A
and I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-54-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
56
|
I-56-A
and I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-55-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
57
|
I-57-A
and I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-56-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
58
|
I-58-A
and I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-57-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
59
|
I-59-A
and I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-58-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
60
|
I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
I-1-A
through I-59-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
thereafter
|
I-1-A
through I-60-A
|
Uncertificated
REMIC I Pass-Through Rate
|
With
respect to REMIC I Regular Interest LT-IO, the excess of (i) the Uncertificated
REMIC I Pass-Through Rates for REMIC I Regular Interests ending with the
designation “A”, over (ii) 2 multiplied by Swap LIBOR.
Uncertificated
REMIC Regular Interest:
The
REMIC I Regular Interests, REMIC II Regular Interests, Class X Interest, Class
P
Interest, Class IO Interest and REMIC VI Regular Interests.
Voting
Rights:
The
portion of the voting rights of all the Certificates that is allocated to any
Certificate for purposes of the voting provisions hereunder. Voting Rights
shall
be allocated (i) 98% to the Certificates (other than the Class X, Class P and
the Residual Certificates) and (ii) 1% to each of the Class X Certificates
and
Class P Certificates. Voting rights will be allocated among the Certificates
of
each such Class in accordance with their respective Percentage Interests. The
Residual Certificates will not be allocated any voting rights.
Wachovia:
Wachovia Mortgage Corporation, and any successor thereto appointed under the
Servicing Agreement in connection with the servicing and administration of
the
Wachovia Mortgage Loans.
Wachovia
Mortgage Loans:
Those
Mortgage Loans serviced by Wachovia pursuant to the terms and provisions of
the
Servicing Agreement and identified as such on the Mortgage Loan
Schedule.
Section
1.02 Allocation
of Certain Interest Shortfalls.
For
purposes of calculating the amount of the Interest Remittance Amount for the
Mortgage Loans for any Distribution Date, (1) the aggregate amount of any Net
Interest Shortfalls in respect of the Mortgage Loans for any Distribution Date
shall reduce the Interest Remittance Amount on a pro
rata
basis
based on, and to the extent of, one month’s interest at the then applicable
respective Pass-Through Rate on the respective Certificate Principal Balance
of
each class of Senior Certificates and Mezzanine Certificates and (2) the
aggregate amount of any Realized Losses allocated to the Senior Certificates
and
Mezzanine Certificates and Basis Risk Shortfalls allocated to the Senior
Certificates and Mezzanine Certificates for any Distribution Date shall be
allocated to the Class X Certificates based on, and to the extent of, one
month’s interest at the then applicable respective Pass-Through Rate on the
Certificate Principal Balance thereof on any Distribution Date.
For
purposes of calculating the amount of Uncertificated Accrued Interest for the
REMIC I Regular Interests for any Distribution Date the aggregate amount of
any
Net Interest Shortfalls for any Distribution Date shall be allocated first,
to
REMIC I Regular Interest I and to the REMIC I Regular Interests ending with
the
designation “B”, pro
rata
based
on, and to the extent of, one month’s interest at the then applicable respective
Uncertificated REMIC I Pass-Through Rates on the respective Uncertificated
Principal Balances of each such REMIC I Regular Interest, and then, to REMIC
I
Regular Interests ending with the designation “A”, pro rata based on, and to the
extent of, one month’s interest at the then applicable respective Uncertificated
REMIC I Pass-Through Rate on the respective Uncertificated Principal Balances
of
each such REMIC I Regular Interest.
For
purposes of calculating the amount of Uncertificated Accrued Interest for the
REMIC II Regular Interests for any Distribution Date:
The
aggregate amount of any Net Interest Shortfalls incurred in respect of the
Mortgage Loans for any Distribution Date shall be allocated among
REMIC II Regular Interest L-AA, REMIC II Regular Interest LT-A1A, REMIC II
Regular Interest LT-A1B, REMIC II Regular Interest LT-A2, REMIC II Regular
Interest LT-A3A, REMIC II Regular Interest LT-A3B, REMIC II Regular Interest
LT-A4A, REMIC II Regular Interest LT-A4B, REMIC II Regular Interest LT-M1,
REMIC
II Regular Interest LT-M2, REMIC II Regular Interest LT-M3, REMIC II Regular
Interest LT-M4, REMIC II Regular Interest LT-M5 and REMIC II Regular Interest
LT-ZZ, pro
rata
based
on, and to the extent of, one month’s interest at the then applicable respective
Uncertificated REMIC II Pass-Through Rate on the respective Uncertificated
Principal Balance of each such REMIC II Regular Interest.
Any
Net
Interest Shortfalls allocated to the Class X Certificates shall be deemed to
be
allocated to the Class X Interest.
ARTICLE
II
CONVEYANCE
OF TRUST FUND
REPRESENTATIONS
AND WARRANTIES
Section
2.01 Conveyance
of Trust Fund.
The
Sponsor hereby sells, transfers, assigns, sets over and otherwise conveys to
the
Depositor, without recourse, all the right, title and interest of the Sponsor
in
and to the assets in the Trust Fund.
The
Sponsor has entered into this Agreement in consideration for the purchase of
the
Mortgage Loans by the Depositor and has agreed to take the actions specified
herein.
The
Depositor, concurrently with the execution and delivery hereof, hereby sells,
transfers, assigns, sets over and otherwise conveys to the Trustee for the
use
and benefit of the Certificateholders, without recourse, all the right, title
and interest of the Depositor in and to the Trust Fund.
Concurrently
with the execution and delivery of this Agreement, the Depositor does hereby
assign to the Trustee all of its rights and interest under the Mortgage Loan
Purchase Agreement, to the extent of the Mortgage Loans sold under the Mortgage
Loan Purchase Agreement. The Trustee hereby accepts such assignment, and shall
be entitled to exercise all rights of the Depositor under the Mortgage Loan
Purchase Agreement as if, for such purpose, it were the Depositor. The foregoing
sale, transfer, assignment, set-over, deposit and conveyance does not and is
not
intended to result in creation or assumption by the Trustee of any obligation
of
the Depositor, the Sponsor or any other Person in connection with the Mortgage
Loans or any other agreement or instrument relating thereto except as
specifically set forth herein.
In
connection with such sale, the Depositor does hereby deliver to, and deposit
with the Custodian pursuant to the Custodial Agreement the documents with
respect to each Mortgage Loan as described under Section 2 of the Custodial
Agreement (the “Mortgage Loan Documents”). In connection with such delivery and
as further described in the Custodial Agreement, the Custodian will be required
to review such Mortgage Loan Documents and deliver to the Trustee, the
Depositor, the Servicers and the Sponsor certifications (in the forms attached
to the Custodial Agreement) with respect to such review with exceptions noted
thereon. In addition, under the Custodial Agreement the Depositor will be
required to cure certain defects with respect to the Mortgage Loan Documents
for
the Mortgage Loans after the delivery thereof by the Depositor to the Custodian
as more particularly set forth therein.
Notwithstanding
anything to the contrary contained herein, the parties hereto acknowledge that
the functions of the Trustee with respect to the custody, acceptance, inspection
and release of the Mortgage Files and preparation and delivery of the
certifications shall be performed by the Custodian pursuant to the terms and
conditions of the Custodial Agreement.
The
Depositor shall deliver or cause to be delivered to the related Servicer copies
of all trailing documents required to be included in the related Mortgage File
at the same time the originals or certified copies thereof are delivered to
the
Custodian, such documents including the mortgagee policy of title insurance
and
any Mortgage Loan Documents upon return from the recording office. No Servicer
shall be responsible for any custodial fees or other costs incurred in obtaining
such documents and the Depositor shall cause each Servicer to be reimbursed
for
any such costs such Servicer may incur in connection with performing its
obligations under this Agreement or the Servicing Agreement, as
applicable.
The
Mortgage Loans permitted by the terms of this Agreement to be included in the
Trust Fund are limited to (i) Mortgage Loans (which the Depositor acquired
pursuant to the Mortgage Loan Purchase Agreement, which contains, among other
representations and warranties, a representation and warranty of the Sponsor
that no Mortgage Loan is a “High-Cost Home Loan” as defined in the New Jersey
Home Ownership Act effective November 27, 2003, as defined in the New Mexico
Home Loan Protection Act effective January 1, 2004) as defined in the
Massachusetts Predatory Home Loan Practices Act, effective November 7, 2004
(Mass. Xxx. Laws Ch. 183C) or as defined in the Indiana Home Loan Practices
Act,
effective January 1, 2005 (Ind. Code Xxx. Sections 24-9-1 through 24-9-9) and
(ii) Qualified Substitute Mortgage Loans (which, by definition as set forth
herein and referred to in the Mortgage Loan Purchase Agreement, are required
to
conform to, among other representations and warranties, the representation
and
warranty of the Sponsor that no Qualified Substitute Mortgage Loan is a
“High-Cost Home Loan” as defined in the New Jersey Home Ownership Act effective
November 27, 2003, as defined in the New Mexico Home Loan Protection Act
effective January 1, 2004, as defined in the Massachusetts Predatory Home Loan
Practices Act, effective November 7, 2004 (Mass. Xxx. Laws Ch. 183C) or as
defined in the Indiana Home Loan Practices Act, effective January 1, 2005 (Ind.
Code Xxx. Sections 24-9-1 through 24-9-9). The Depositor and the Trustee on
behalf of the Trust Fund understand and agree that it is not intended that
any
mortgage loan be included in the Trust Fund that is a “High-Cost Home Loan” as
defined in the New Jersey Home Ownership Act effective November 27, 2003, as
defined in the New Mexico Home Loan Protection Act effective January 1, 2004,
as
defined in the Massachusetts Predatory Home Loan Practices Act, effective
November 7, 2004 (Mass. Xxx. Laws Ch. 183C) or as defined in the Indiana Home
Loan Practices Act, effective January 1, 2005 (Ind. Code Xxx. Sections 24-9-1
through 24-9-9).
Section
2.02 Acceptance
of the Mortgage Loans.
(a) Based
on
the initial trust receipt received by it from the Custodian pursuant to the
Custodial Agreement, the Trustee acknowledges receipt, subject to the provisions
of Section 2.01 hereof and Section 2 of the Custodial Agreement, of
the Mortgage Loan Documents and all other assets included in the definition
of
“REMIC I” under clauses (i), (ii) (iii), (v) and (vi) (to the extent of amounts
deposited into the Distribution Account) and declares that it holds (or the
Custodian on its behalf holds) and will hold such documents and the other
documents delivered to it constituting a Mortgage Loan Document, and that it
holds (or the Custodian on its behalf holds) or will hold all such assets and
such other assets included in the definition of “REMIC I” in trust for the
exclusive use and benefit of all present and future
Certificateholders.
(b) In
conducting the review of the Mortgage Files in accordance with the Custodial
Agreement, the Custodian on the Trustee’s behalf will ascertain whether all
required documents have been executed and received and whether those documents
relate to the Mortgage Loans identified in Exhibit B to this Agreement, as
supplemented. If the Custodian finds any document constituting part of the
Mortgage File not to have been executed or received, or to be unrelated to
the
Mortgage Loans identified in Exhibit B, the Sponsor shall correct or cure any
such defect or, if prior to the end of the second anniversary of the Closing
Date, the Sponsor may substitute for the related Mortgage Loan a Replacement
Mortgage Loan, which substitution shall be accomplished in the manner and
subject to the conditions set forth in Section 2.03 or shall deliver to the
Trustee an Opinion of Counsel to the effect that such defect does not materially
or adversely affect the interests of the Certificateholders in such Mortgage
Loan within sixty (60) days from the date of notice from the Custodian of the
defect and if the Sponsor fails to correct or cure the defect or deliver such
opinion within such period, the Sponsor will, subject to Section 2.03,
within ninety (90) days from the notification of the Custodian purchase such
Mortgage Loan at the Purchase Price; provided, however, that if such defect
relates solely to the inability of the Sponsor to deliver the Mortgage,
assignment thereof to the Custodian, or intervening assignments thereof with
evidence of recording thereon because such documents have been submitted for
recording and have not been returned by the applicable jurisdiction, the Sponsor
shall not be required to purchase such Mortgage Loan if the Sponsor delivers
such documents promptly upon receipt, but in no event later than 360 days after
the Closing Date.
(c) No
later
than 180 days after the Closing Date, the Custodian on the Trustee’s behalf will
review, for the benefit of the Certificateholders, the Mortgage Files and will
execute and deliver or cause to be executed and delivered to the Sponsor and
the
Trustee, a final trust receipt substantially in the form annexed to the
Custodial Agreement. In conducting such review, the Custodian on the Trustee’s
behalf and in accordance with the terms of the Custodial Agreement will
ascertain whether each document required to be recorded has been returned from
the recording office with evidence of recording thereon and the Custodian on
the
Trustee’s behalf has received either an original or a copy thereof, as required
in the Custodial Agreement. If the Custodian finds that any document with
respect to a Mortgage Loan has not been received, or is unrelated to the
Mortgage Loans identified in Exhibit B or appears to be defective on its face,
the Custodian shall note such defect in the exception report attached the final
trust receipt issued pursuant to the Custodial Agreement and the Sponsor shall
correct or cure any such defect or, if prior to the end of the second
anniversary of the Closing Date, the Sponsor may substitute for the related
Mortgage Loan a Replacement Mortgage Loan, which substitution shall be
accomplished in the manner and subject to the conditions set forth in
Section 2.03 or shall deliver to the Trustee an Opinion of Counsel to the
effect that such defect does not materially or adversely affect the interests
of
Certificateholders in such Mortgage Loan within sixty (60) days from the date
of
notice from the Trustee of the defect and if the Sponsor is unable within such
period to correct or cure such defect, or to substitute the related Mortgage
Loan with a Replacement Mortgage Loan or to deliver such opinion, the Sponsor
shall, subject to Section 2.03, within ninety (90) days from the
notification of the Trustee, purchase such Mortgage Loan at the Purchase Price;
provided, however, that if such defect relates solely to the inability of the
Sponsor to deliver the Mortgage, assignment thereof to the Trustee or
intervening assignments thereof with evidence of recording thereon, because
such
documents have not been returned by the applicable jurisdiction, the Sponsor
shall not be required to purchase such Mortgage Loan, if the Sponsor delivers
such documents promptly upon receipt, but in no event later than 360 days after
the Closing Date.
(d) In
the
event that a Mortgage Loan is purchased by the Sponsor in accordance with
subsections 2.02(a) or (b) above or Section 2.03, the Sponsor shall remit
the applicable Purchase Price to the Servicer for deposit in the Custodial
Account and shall provide written notice to the Securities Administrator
detailing the components of the Purchase Price, signed by an authorized officer.
Upon deposit of the Purchase Price in the Custodial Account and upon receipt
of
a request for release (in the form attached to the Custodial Agreement) with
respect to such Mortgage Loan, the Custodian, on behalf of the Trustee, will
release to the Sponsor the related Mortgage File and the Trustee shall execute
and deliver all instruments of transfer or assignment, without recourse,
furnished to it by the Sponsor, as are necessary to vest in the Sponsor title
to
and rights under the Mortgage Loan. Such purchase shall be deemed to have
occurred on the date on which the deposit into the Custodial Account was made.
The Trustee shall promptly notify the Rating Agencies of such repurchase. The
obligation of the Sponsor to cure, repurchase or substitute for any Mortgage
Loan as to which a defect in a constituent document exists shall be the sole
remedies respecting such defect available to the Certificateholders or to the
Trustee on their behalf. The Sponsor shall promptly reimburse the Trustee for
any expenses incurred by the Trustee in respect of enforcing the remedies for
such breach.
(e) The
Sponsor shall deliver to the Custodian the Mortgage Note and other documents
constituting the Mortgage File with respect to any Replacement Mortgage Loan,
which the Custodian will review as provided in the Custodial Agreement,
provided, that the Closing Date referred to therein shall instead be the date
of
delivery of the Mortgage File with respect to each Replacement Mortgage
Loan.
Section
2.03 Representations,
Warranties and Covenants of GMACM and the Sponsor.
(a) GMACM
hereby represents and warrants to, and covenants with, the Sponsor, the
Depositor, the Master Servicer, the Securities Administrator and the Trustee
as
follows, as of the Closing Date:
(i) It
is
duly organized and is validly existing and in good standing under the laws
of
the Commonwealth of Pennsylvania and is duly authorized and qualified to
transact any and all business contemplated by this Agreement to be conducted
by
it in any state in which a Mortgaged Property related to a GMACM Mortgage Loan
is located or is otherwise not required under applicable law to effect such
qualification and, in any event, is in compliance with the doing business laws
of any such state, to the extent necessary to ensure its ability to service
the
GMACM Mortgage Loans in accordance with the terms of this Agreement and to
perform any of its other obligations under this Agreement in accordance with
the
terms hereof.
(ii) It
has
the full corporate power and authority to service each GMACM Mortgage Loan,
and
to execute, deliver and perform, and to enter into and consummate the
transactions contemplated by this Agreement and has duly authorized by all
necessary corporate action on its part the execution, delivery and performance
of this Agreement; and this Agreement, assuming the due authorization, execution
and delivery hereof by the other parties hereto, constitutes its legal, valid
and binding obligation, enforceable against it in accordance with its terms,
except that (a) the enforceability hereof may be limited by bankruptcy,
insolvency, moratorium, receivership and other similar laws relating to
creditors’ rights generally and (b) the remedy of specific performance and
injunctive and other forms of equitable relief may be subject to equitable
defenses and to the discretion of the court before which any proceeding therefor
may be brought and further subject to public policy with respect to indemnity
and contribution under applicable securities law.
(iii) The
execution and delivery of this Agreement by it, the servicing of the GMACM
Mortgage Loans by it under this Agreement, the consummation of any other of
the
transactions contemplated by this Agreement, and the fulfillment of or
compliance with the terms hereof are in its ordinary course of business and
will
not (A) result in a material breach of any term or provision of its charter
or
by-laws or (B) materially conflict with, result in a material breach, violation
or acceleration of, or result in a material default under, the terms of any
other material agreement or instrument to which it is a party or by which it
may
be bound, or (C) constitute a material violation of any statute, order or
regulation applicable to it of any court, regulatory body, administrative agency
or governmental body having jurisdiction over it; and it is not in breach or
violation of any material indenture or other material agreement or instrument,
or in violation of any statute, order or regulation of any court, regulatory
body, administrative agency or governmental body having jurisdiction over it
which breach or violation may materially impair its ability to perform or meet
any of its obligations under this Agreement.
(iv) It
is an
approved servicer of conventional mortgage loans for Xxxxxx Xxx or Xxxxxxx
Mac
and is a mortgagee approved by the Secretary of Housing and Urban Development
pursuant to sections 203 and 211 of the National Housing Act.
(v) No
litigation is pending or, to the best of its knowledge, threatened in writing,
against it that would materially and adversely affect the execution, delivery
or
enforceability of this Agreement or its ability to service the GMACM Mortgage
Loans or to perform any of its other obligations under this Agreement in
accordance with the terms hereof.
(vi) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for its execution, delivery and performance of, or compliance
with, this Agreement or the consummation of the transactions contemplated
hereby, or if any such consent, approval, authorization or order is required,
it
has obtained the same.
(vii) GMACM
has
accurately and fully reported, and will continue to accurately and fully report,
its borrower credit files to each of the credit repositories in a timely manner
materially in accordance with the Fair Credit Reporting Act and its implementing
legislation.
(viii) GMACM
is
a member of MERS in good standing, and will comply in all material respects
with
the rules and procedures of MERS in connection with the servicing of the GMACM
Mortgage Loans that are registered with MERS.
(ix) GMACM
will not waive any Prepayment Charge with respect to a GMACM Mortgage Loan
unless it is waived in accordance with the standard set forth in
Section 3.01.
If
the
covenant of GMACM set forth in Section 2.03(a)(ix), as applicable above is
breached by GMACM, GMACM will pay the amount of such waived Prepayment Charge,
for the benefit of the Holders of the Class P Certificates, by depositing such
amount into the Custodial Account within ninety (90) days of the earlier of
discovery by GMACM or receipt of notice by GMACM of such breach. Notwithstanding
the foregoing, or anything to the contrary contained in this Agreement, GMACM
shall have no liability for a waiver of any Prepayment Charge in the event
that
GMACM’s determination to make such a waiver was made by GMACM in reliance on
information properly received by GMACM from any Person in accordance with the
terms of this Agreement.
(b) The
Sponsor hereby represents and warrants to and covenants with, the Depositor,
GMACM, the Master Servicer, the Securities Administrator and the Trustee as
follows, as of the Closing Date:
(i) The
Sponsor is duly organized, validly existing and in good standing under the
laws
of the State of Delaware and is duly authorized and qualified to transact any
and all business contemplated by this Agreement to be conducted by the Sponsor
in any state in which a Mortgaged Property is located or is otherwise not
required under applicable law to effect such qualification and, in any event,
is
in compliance with the doing business laws of any such state, to the extent
necessary to ensure its ability to enforce each Mortgage Loan, to sell the
Mortgage Loans in accordance with the terms of this Agreement and to perform
any
of its other obligations under this Agreement in accordance with the terms
hereof.
(ii) The
Sponsor has the full corporate power and authority to sell each Mortgage Loan,
and to execute, deliver and perform, and to enter into and consummate the
transactions contemplated by this Agreement and has duly authorized by all
necessary corporate action on the part of the Sponsor the execution, delivery
and performance of this Agreement; and this Agreement, assuming the due
authorization, execution and delivery hereof by the other parties hereto,
constitutes a legal, valid and binding obligation of the Sponsor, enforceable
against the Sponsor in accordance with its terms, except that (a) the
enforceability hereof may be limited by bankruptcy, insolvency, moratorium,
receivership and other similar laws relating to creditors’ rights generally and
(b) the remedy of specific performance and injunctive and other forms of
equitable relief may be subject to equitable defenses and to the discretion
of
the court before which any proceeding therefor may be brought and further
subject to public policy with respect to indemnity and contribution under
applicable securities law.
(iii) The
execution and delivery of this Agreement by the Sponsor, the sale of the
Mortgage Loans by the Sponsor under this Agreement, the consummation of any
other of the transactions contemplated by this Agreement, and the fulfillment
of
or compliance with the terms hereof are in the ordinary course of business
of
the Sponsor and will not (A) result in a material breach of any term or
provision of the charter or by-laws of the Sponsor or (B) materially conflict
with, result in a material breach, violation or acceleration of, or result
in a
material default under, the terms of any other material agreement or instrument
to which the Sponsor is a party or by which it may be bound, or (C) constitute
a
material violation of any statute, order or regulation applicable to the Sponsor
of any court, regulatory body, administrative agency or governmental body having
jurisdiction over the Sponsor; and the Sponsor is not in breach or violation
of
any material indenture or other material agreement or instrument, or in
violation of any statute, order or regulation of any court, regulatory body,
administrative agency or governmental body having jurisdiction over it which
breach or violation may materially impair the Sponsor’s ability to perform or
meet any of its obligations under this Agreement.
(iv) The
Sponsor is an approved seller of conventional mortgage loans for Xxxxxx Mae
or
Xxxxxxx Mac and is a mortgagee approved by the Secretary of Housing and Urban
Development pursuant to sections 203 and 211 of the National Housing
Act.
(v) No
litigation is pending or, to the best of the Sponsor’s knowledge, threatened,
against the Sponsor that would materially and adversely affect the execution,
delivery or enforceability of this Agreement or the ability of the Sponsor
to
sell the Mortgage Loans or to perform any of its other obligations under this
Agreement in accordance with the terms hereof.
(vi) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for the execution, delivery and performance by the Sponsor
of,
or compliance by the Sponsor with, this Agreement or the consummation of the
transactions contemplated hereby, or if any such consent, approval,
authorization or order is required, the Sponsor has obtained the
same.
(vii) The
representations and warranties set forth in Section 8 of the Mortgage Loan
Purchase Agreement are true and correct as of the Closing Date.
(viii) No
Mortgage Loan is subject to the Home Ownership and Equity Protection Act of
1994
or any comparable law and no Mortgage Loan is classified and/or defined as
a
“high cost”, “covered”, “high risk home” or “predatory” loan under any other
state, federal or local law or regulation or ordinance (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).
(ix) No
loan
is a High Cost Loan or Covered Loan, as applicable (as such terms are defined
in
Appendix E of the Standard & Poor's Glossary For File Format For LEVELS®
Version 5.6 Revised (attached hereto as Exhibit K) and no Mortgage Loan
originated on or after October 1, 2002 through March 6, 2003 is governed by
the
Georgia Fair Lending Act.
(x) Any
and
all requirements of any federal, state or local law including, without
limitation, usury, truth in lending, real estate settlement procedures, consumer
credit protection, equal credit opportunity, fair housing, predatory, abusive
lending or disclosure laws applicable to the origination and servicing of the
Mortgage Loans have been complied with in all material respects.
(c) Upon
discovery by any of the parties hereto of a breach of a representation or
warranty set forth in Section 2.03(b)(viii), (ix) and (x) and
Section 8 of the Mortgage Loan Purchase Agreement that materially and
adversely affects the interests of the Certificateholders in any Mortgage Loan,
the party discovering such breach shall give prompt written notice thereof
to
the other parties. The Sponsor hereby covenants with respect to the
representations and warranties set forth in Section 2.03(b)(viii), (ix) and
(x) and Section 8 of the Mortgage Loan Purchase Agreement, that within
ninety (90) days of the discovery of a breach of any representation or warranty
set forth therein that materially and adversely affects the interests of the
Certificateholders in any Mortgage Loan, it shall cure such breach in all
material respects and, if such breach is not so cured, (i) prior to the second
anniversary of the Closing Date, remove such Mortgage Loan (a “Deleted Mortgage
Loan”) from the Trust Fund and substitute in its place a Replacement Mortgage
Loan, in the manner and subject to the conditions set forth in this Section;
or
(ii) repurchase the affected Mortgage Loan or Mortgage Loans from the Trustee
at
the Purchase Price in the manner set forth below; provided that any such
substitution pursuant to (i) above or repurchase pursuant to (ii) above shall
not be effected prior to the delivery to the Trustee of an Opinion of Counsel
if
required by Section 2.05 and any such substitution pursuant to (i) above
shall not be effected prior to the additional delivery to the Custodian of
a
request for release in accordance with the Custodial Agreement. The Sponsor
shall promptly reimburse the Trustee for any expenses reasonably incurred by
the
Trustee in respect of enforcing the remedies for such breach. To enable the
related Servicer to amend the Mortgage Loan Schedule, the Sponsor shall, unless
it cures such breach in a timely fashion pursuant to this Section 2.03,
promptly notify the Trustee whether it intends either to repurchase, or to
substitute for, the Mortgage Loan affected by such breach. With respect to
the
representations and warranties in Section 8 of the Mortgage Loan Purchase
Agreement that are made to the best of the Sponsor’s knowledge, if it is
discovered by any of the Depositor, the Sponsor or the Trustee that the
substance of such representation and warranty is inaccurate and such inaccuracy
materially and adversely affects the value of the related Mortgage Loan,
notwithstanding the Sponsor’s lack of knowledge with respect to the substance of
such representation or warranty, the Sponsor shall nevertheless be required
to
cure, substitute for or repurchase the affected Mortgage Loan in accordance
with
the foregoing. Notwithstanding the foregoing, any breach of a representation
or
warranty contained in clauses (xxxvii), (xxxviii), (xxxix), (xl) and/or (xlv)
of
Section 8 of the Mortgage Loan Purchase Agreement shall be automatically
deemed to materially and adversely affect the interests of the
Certificateholders.
With
respect to any Replacement Mortgage Loan or Loans, the Sponsor shall deliver
to
the Custodian for the benefit of the Certificateholders such documents and
agreements as are required by Section 2 of the Custodial Agreement. No
substitution will be made in any calendar month after the Determination Date
for
such month. Scheduled Payments due with respect to Replacement Mortgage Loans
in
the Due Period related to the Distribution Date on which such proceeds are
to be
distributed shall not be part of the Trust Fund and will be retained by the
Sponsor. For the month of substitution, distributions to Certificateholders
will
include the Scheduled Payment due on any Deleted Mortgage Loan for the related
Due Period and thereafter the Sponsor shall be entitled to retain all amounts
received in respect of such Deleted Mortgage Loan. The related Servicer shall
amend the Mortgage Loan Schedule for the benefit of the Certificateholders
to
reflect the removal of such Deleted Mortgage Loan and the substitution of the
Replacement Mortgage Loan or Loans and shall deliver the amended Mortgage Loan
Schedule to the Trustee, the Master Servicer and the Securities Administrator.
Upon such substitution, the Replacement Mortgage Loan or Loans shall be subject
to the terms of this Agreement in all respects, and the Sponsor shall be deemed
to have made with respect to such Replacement Mortgage Loan or Loans, as of
the
date of substitution, the representations and warranties set forth in
Section 8 of the Mortgage Loan Purchase Agreement with respect to such
Mortgage Loan. Upon any such substitution and the deposit into the related
Custodial Account of the amount required to be deposited therein in connection
with such substitution as described in the following paragraph and receipt
by
the Custodian of a request for release for such Mortgage Loan in accordance
with
the Custodial Agreement, the Custodian on behalf of the Trustee shall release
to
the Sponsor the Mortgage File relating to such Deleted Mortgage Loan and held
for the benefit of the Certificateholders and the Trustee shall execute and
deliver at the Sponsor’s direction such instruments of transfer or assignment as
have been prepared by the Sponsor, in each case without recourse, as shall
be
necessary to vest in the Sponsor, or its respective designee, title to the
Trustee’s interest in any Deleted Mortgage Loan substituted for pursuant to this
Section 2.03. Neither the Trustee nor the Custodian shall have any further
responsibility with regard to such Mortgage File.
For
any
month in which the Sponsor substitutes one or more Replacement Mortgage Loans
for a Deleted Mortgage Loan, the Securities Administrator will determine the
amount (if any) by which the aggregate principal balance of all the Replacement
Mortgage Loans as of the date of substitution is less than the Stated Principal
Balance (after application of the principal portion of the Scheduled Payment
due
in the month of substitution) of such Deleted Mortgage Loan. An amount equal
to
the aggregate of such deficiencies, described in the preceding sentence for
any
Distribution Date (such amount, the “Substitution Adjustment Amount”) shall be
remitted to the related Servicer for deposit in the related Custodial Account
by
the Sponsor delivering such Replacement Mortgage Loan on or before the
Determination Date for the Distribution Date relating to the Prepayment Period
during which the related Mortgage Loan was required to be purchased or replaced
hereunder.
In
the
event that the Sponsor shall be required to repurchase a Mortgage Loan, the
Purchase Price therefor shall be remitted to the related Servicer for deposit
in
the related Custodial Account, on or before the Determination Date immediately
following the date on which the Sponsor was required to repurchase such Mortgage
Loan. The Purchase Price shall be remitted by the related Servicer to the
Securities Administrator on the Remittance Date occurring in the month
immediately following the month in which the Purchase Price was deposited in
the
related Custodial Account. In addition, upon such deposit of the Purchase Price,
the delivery of an Officer’s Certificate by the Servicer (which shall be
delivered no more than two (2) Business Days following such deposit) to the
Trustee certifying that the Purchase Price has been deposited in the related
Custodial Account, the delivery of an Opinion of Counsel if required by
Section 2.05 and the receipt of a Request for Release, the Trustee shall
release the related Mortgage File held for the benefit of the related
Certificateholders to the Sponsor, and the Trustee shall execute and deliver
at
such Person’s direction the related instruments of transfer or assignment
prepared by the Sponsor, in each case without recourse, as shall be necessary
to
transfer title from the Trustee for the benefit of the Certificateholders and
transfer the Trustee’s interest to the Sponsor to any Mortgage Loan purchased
pursuant to this Section 2.03. It is understood and agreed that the
obligation under this Agreement of the Sponsor to cure, repurchase or replace
any Mortgage Loan as to which a breach has occurred or is continuing shall
constitute the sole remedies against the Sponsor respecting such breach
available to each Certificateholder, the Depositor or the Trustee.
(d) The
Master Servicer hereby represents, warrants and covenants with GMACM, the
Sponsor, the Depositor and the Trustee as follows, as of the Closing
Date:
(i) The
Master Servicer is a national banking association duly formed, validly existing
and in good standing under the laws of the United States of America and is
duly
authorized and qualified to transact any and all business contemplated by this
Agreement to be conducted by the Master Servicer;
(ii) The
Master Servicer has the full power and authority to conduct its business as
presently conducted by it and to execute, deliver and perform, and to enter
into
and consummate, all transactions contemplated by this Agreement. The Master
Servicer has duly authorized the execution, delivery and performance of this
Agreement, has duly executed and delivered this Agreement, and this Agreement,
assuming due authorization, execution and delivery by the other parties hereto,
constitutes a legal, valid and binding obligation of the Master Servicer,
enforceable against it in accordance with its terms except as the enforceability
thereof may be limited by bankruptcy, insolvency, reorganization or similar
laws
affecting the enforcement of creditors’ rights generally and by general
principles of equity;
(iii) The
execution and delivery of this Agreement by the Master Servicer, the
consummation by the Master Servicer of any other of the transactions herein
contemplated, and the fulfillment of or compliance with the terms hereof are
in
the ordinary course of business of the Master Servicer and will not (A) result
in a breach of any term or provision of charter and by-laws of the Master
Servicer or (B) conflict with, result in a breach, violation or acceleration
of,
or result in a default under, the terms of any other material agreement or
instrument to which the Master Servicer is a party or by which it may be bound,
or any statute, order or regulation applicable to the Master Servicer of any
court, regulatory body, administrative agency or governmental body having
jurisdiction over the Master Servicer; and the Master Servicer is not a party
to, bound by, or in breach or violation of any indenture or other agreement
or
instrument, or subject to or in violation of any statute, order or regulation
of
any court, regulatory body, administrative agency or governmental body having
jurisdiction over it, which materially and adversely affects or, to the Master
Servicer’s knowledge, would in the future materially and adversely affect, (x)
the ability of the Master Servicer to perform its obligations under this
Agreement or (y) the business, operations, financial condition, properties
or
assets of the Master Servicer taken as a whole;
(iv) The
Master Servicer does not believe, nor does it have any reason or cause to
believe, that it cannot perform each and every covenant made by it and contained
in this Agreement;
(v) No
litigation is pending against the Master Servicer that would materially and
adversely affect the execution, delivery or enforceability of this Agreement
or
the ability of the Master Servicer to perform any of its other obligations
hereunder in accordance with the terms hereof,
(vi) There
are
no actions or proceedings against, or investigations known to it of, the Master
Servicer before any court, administrative or other tribunal (A) that might
prohibit its entering into this Agreement, (B) seeking to prevent the
consummation of the transactions contemplated by this Agreement or (C) that
might prohibit or materially and adversely affect the performance by the Master
Servicer of its obligations under, or validity or enforceability of, this
Agreement; and
(vii) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for the execution, delivery and performance by the Master
Servicer of, or compliance by the Master Servicer with, this Agreement or the
consummation by it of the transactions contemplated by this Agreement, except
for such consents, approvals, authorizations or orders, if any, that have been
obtained prior to the Closing Date.
(e) The
representations and warranties set forth in Section 2.03 shall survive
delivery of the respective Mortgage Loans and Mortgage Files to the Trustee
or
the Custodian for the benefit of the Certificateholders.
Section
2.04 Representations
and Warranties of the Depositor.
The
Depositor hereby represents and warrants to, and covenants, with GMACM, the
Sponsor, the Master Servicer, the Securities Administrator and the Trustee
as
follows, as of the date hereof and as of the Closing Date:
(i) The
Depositor is duly organized and is validly existing as a corporation in good
standing under the laws of the State of Delaware and has full power and
authority (corporate and other) necessary to own or hold its properties and
to
conduct its business as now conducted by it and to enter into and perform its
obligations under this Agreement.
(ii) The
Depositor has the full corporate power and authority to execute, deliver and
perform, and to enter into and consummate the transactions contemplated by,
this
Agreement and has duly authorized, by all necessary corporate action on its
part, the execution, delivery and performance of this Agreement; and this
Agreement, assuming the due authorization, execution and delivery hereof by
the
other parties hereto, constitutes a legal, valid and binding obligation of
the
Depositor, enforceable against the Depositor in accordance with its terms,
subject, as to enforceability, to (i) bankruptcy, insolvency, moratorium
receivership and other similar laws relating to creditors’ rights generally and
(ii) the remedy of specific performance and injunctive and other forms of
equitable relief may be subject to equitable defenses and to the discretion
of
the court before which any proceeding therefor may be brought and further
subject to public policy with respect to indemnity and contribution under
applicable securities law.
(iii) The
execution and delivery of this Agreement by the Depositor, the consummation
of
the transactions contemplated by this Agreement, and the fulfillment of or
compliance with the terms hereof are in the ordinary course of business of
the
Depositor and will not (A) result in a material breach of any term or provision
of the charter or by-laws of the Depositor or (B) materially conflict with,
result in a material breach, violation or acceleration of, or result in a
material default under, the terms of any other material agreement or instrument
to which the Depositor is a party or by which it may be bound or (C) constitute
a material violation of any statute, order or regulation applicable to the
Depositor of any court, regulatory body, administrative agency or governmental
body having jurisdiction over the Depositor; and the Depositor is not in breach
or violation of any material indenture or other material agreement or
instrument, or in violation of any statute, order or regulation of any court,
regulatory body, administrative agency or governmental body having jurisdiction
over it which breach or violation may materially impair the Depositor’s ability
to perform or meet any of its obligations under this Agreement.
(iv) No
litigation is pending, or, to the best of the Depositor’s knowledge, threatened,
against the Depositor that would materially and adversely affect the execution,
delivery or enforceability of this Agreement or the ability of the Depositor
to
perform its obligations under this Agreement in accordance with the terms
hereof.
(v) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for the execution, delivery and performance by the Depositor
of, or compliance by the Depositor with, this Agreement or the consummation
of
the transactions contemplated hereby, or if any such consent, approval,
authorization or order is required, the Depositor has obtained the
same.
The
Depositor hereby represents and warrants to the Trustee as of the Closing Date,
following the transfer of the Mortgage Loans to it by the Sponsor, the Depositor
had good title to the Mortgage Loans and the related Mortgage Notes were subject
to no offsets, claims, defenses or counterclaims.
It
is
understood and agreed that the representations and warranties set forth in
this
Section 2.04 shall survive delivery of the Mortgage Files to the Trustee or
the Custodian for the benefit of the Certificateholders. Upon discovery by
the
Depositor, the Servicer, the Master Servicer or the Trustee of a breach of
such
representations and warranties, the party discovering such breach shall give
prompt written notice to the others and to each Rating Agency.
Section
2.05 Delivery
of Opinion of Counsel in Connection with Substitutions and
Repurchases.
(a) Notwithstanding
any contrary provision of this Agreement, with respect to any Mortgage Loan
that
is not in default or as to which default is not imminent, no repurchase or
substitution pursuant to Sections 2.02 or 2.03 shall be made unless the Sponsor
delivers to the Trustee an Opinion of Counsel, addressed to the Trustee, to
the
effect that such repurchase or substitution would not (i) result in the
imposition of the tax on “prohibited transactions” of any REMIC executed
hereunder or contributions after the Closing Date, as defined in sections
860F(a)(2) and 860G(d) of the Code, respectively or (ii) cause any REMIC to
fail
to qualify as a REMIC at any time that any Certificates are outstanding. Any
Mortgage Loan as to which repurchase or substitution was delayed pursuant to
this paragraph shall be repurchased or the substitution therefor shall occur
(subject to compliance with Sections 2.02 or 2.03) upon the earlier of (a)
the
occurrence of a default or imminent default with respect to such Mortgage Loan
and (b) receipt by the Trustee of an Opinion of Counsel to the effect that
such
repurchase or substitution, as applicable, will not result in the events
described in clause (i) or clause (ii) of the preceding sentence.
(b) Upon
discovery by the Depositor or the Sponsor that any Mortgage Loan does not
constitute a “qualified mortgage” within the meaning of section 860G(a)(3) of
the Code, the party discovering such fact shall promptly (and in any event
within five (5) Business Days of discovery) give written notice thereof to
the
other parties and the Trustee. In connection therewith, the Sponsor, at its
option, shall either (i) substitute, if the conditions in Section 2.03(c)
with respect to substitutions are satisfied, a Replacement Mortgage Loan for
the
affected Mortgage Loan, or (ii) repurchase the affected Mortgage Loan within
ninety (90) days of such discovery in the same manner as it would a Mortgage
Loan for a breach of representation or warranty contained in Section 2.03.
The Trustee shall reconvey to the Sponsor the Mortgage Loan to be released
pursuant hereto in the same manner, and on the same terms and conditions, as
it
would a Mortgage Loan repurchased for breach of a representation or warranty
contained in Section 2.03.
Section
2.06 Issuance
of the REMIC I Regular Interests.
The
Trustee acknowledges the assignment to it of the Mortgage Loans and the delivery
to the Custodian on its behalf of the related Mortgage Files, subject to the
provisions of Section 2.01 and Section 2.02, together with the assignment to
it
of all other assets included in REMIC I, the receipt of which is hereby
acknowledged. The interests evidenced by the Class R-1 Interest, together with
the REMIC I Regular Interests, constitute the entire beneficial ownership
interest in REMIC I. The rights of the Holders of the Class R-1 Interest and
REMIC I (as holder of the REMIC I Regular Interests) to receive distributions
from the proceeds of REMIC I in respect of the Class R-1 Interest and the REMIC
I Regular Interests, respectively, and all ownership interests evidenced or
constituted by the Class R-1 Interest and the REMIC I Regular Interests, shall
be as set forth in this Agreement.
Section
2.07 Conveyance
of the REMIC I Regular Interests, REMIC II Regular Interests and REMIC III
Regular Interest.
(a) The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey to the Trustee, without recourse
all the right, title and interest of the Depositor in and to the REMIC I Regular
Interests for the benefit of the Class R-2 Interest and REMIC II (as holder
of
the REMIC I Regular Interests). The Trustee acknowledges receipt of the REMIC
I
Regular Interests and declares that it holds and will hold the same in trust
for
the exclusive use and benefit of all present and future Holders of the Class
R-2
Interest and REMIC II (as holder of the REMIC I Regular Interests). The rights
of the Holder of the Class R-2 Interest and REMIC II (as holder of the REMIC
I
Regular Interests) to receive distributions from the proceeds of REMIC II in
respect of the Class R-2 Interest and the REMIC II Regular Interests,
respectively, and all ownership interests evidenced or constituted by the Class
R-2 Interest and the REMIC II Regular Interests, shall be as set forth in this
Agreement. The Class R-2 Interest and the REMIC II Regular Interests shall
constitute the entire beneficial ownership interest in REMIC II.
(b) The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey to the Trustee, without recourse
all the right, title and interest of the Depositor in and to the REMIC II
Regular Interests for the benefit of the Class R-3 Interest and REMIC III (as
holder of the REMIC II Regular Interests). The Trustee acknowledges receipt
of
the REMIC II Regular Interests and declares that it holds and will hold the
same
in trust for the exclusive use and benefit of all present and future Holders
of
the Class R-3 Interest and REMIC III (as holder of the REMIC II Regular
Interests). The rights of the Holder of the Class R-3 Interest and REMIC III
(as
holder of the REMIC II Regular Interests) to receive distributions from the
proceeds of REMIC III in respect of the Class R-3 Interest, the REMIC III
Certificates (other than the Class R Certificates), the Class X Interest, Class
P Interest and Class IO Interest, respectively, and all ownership interests
evidenced or constituted by the Class R-3 Interest and the REMIC III
Certificates (other than the Class R Certificates), the Class X Interest, Class
P Interest and Class IO Interest, shall be as set forth in this Agreement.
The
Class R-3 Interest and the REMIC III Certificates (other than the Class R
Certificates), the Class X Interest, Class P Interest and Class IO Interest
shall constitute the entire beneficial ownership interest in REMIC
III.
(c) The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey to the Trustee, without recourse
all the right, title and interest of the Depositor in and to the Class X
Interest for the benefit of the Class R-4 Interest and REMIC IV (as holder
of
the Class X Interest). The Trustee acknowledges receipt of the Class X Interest
and declares that it holds and will hold the same in trust for the exclusive
use
and benefit of all present and future Holders of the Class R-4 Interest and
REMIC IV (as holder of the Class X Interest). The rights of the Holder of the
Class R-4 Interest and REMIC IV (as holder of the Class X Interest) to receive
distributions from the proceeds of REMIC IV in respect of the Class R-4
Interest, the Class X Certificates, and all ownership interests evidenced or
constituted by the Class R-4 Interest and the Class X Certificates, shall be
as
set forth in this Agreement. The Class R-4 Interest and the Class X Certificates
shall constitute the entire beneficial ownership interest in REMIC
IV.
(d) The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey to the Trustee, without recourse
all the right, title and interest of the Depositor in and to the Class P
Interest for the benefit of the Class R-5 Interest and REMIC V (as holder of
the
Class P Interest). The Trustee acknowledges receipt of the Class P Interest
and
declares that it holds and will hold the same in trust for the exclusive use
and
benefit of all present and future Holders of the Class R-5 Interest and REMIC
V
(as holder of the Class P Interest). The rights of the Holder of the Class
R-5
Interest and REMIC V (as holder of the Class P Interest) to receive
distributions from the proceeds of REMIC V in respect of the Class R-5 Interest,
the Class P Certificates, and all ownership interests evidenced or constituted
by the Class R-5 Interest and the Class P Certificates, shall be as set forth
in
this Agreement. The Class R-5 Interest and the Class P Certificates shall
constitute the entire beneficial ownership interest in REMIC V.
(e) The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey to the Trustee, without recourse
all the right, title and interest of the Depositor in and to the Class IO
Interest for the benefit of the Class R-6 Interest and REMIC VI (as holder
of
the Class IO Interest). The Trustee acknowledges receipt of the Class IO
Interest and declares that it holds and will hold the same in trust for the
exclusive use and benefit of all present and future Holders of the Class R-6
Interest and REMIC VI (as holder of the Class IO Interest). The rights of the
Holder of the Class R-6 Interest and REMIC VI (as holder of the Class IO
Interest) to receive distributions from the proceeds of REMIC VI in respect
of
the Class R-6 Interest, REMIC VI Regular Interest Swap-IO, and all ownership
interests evidenced or constituted by the Class R-6 Interest and REMIC VI
Regular Interest Swap-IO, shall be as set forth in this Agreement. The Class
R-6
Interest and REMIC VI Regular Interest Swap-IO shall constitute the entire
beneficial ownership interest in REMIC VI.
Section
2.08 Issuance
of the Class R Certificates and Class R-X Certificates.
(a) The
Trustee acknowledges the assignment to it of the REMIC I Regular Interests
and
REMIC II Regular Interests and, concurrently therewith and in exchange therefor,
pursuant to the written request of the Depositor executed by an officer of
the
Depositor, the Securities Administrator has executed, authenticated and
delivered to or upon the order of the Depositor, the Class R Certificates in
authorized denominations.
(b) The
Trustee acknowledges the assignment to it of the Class X Interest, Class P
Interest and Class IO Interest and, concurrently therewith and in exchange
therefor, pursuant to the written request of the Depositor executed by an
officer of the Depositor, the Securities Administrator has executed,
authenticated and delivered to or upon the order of the Depositor, the Class
R-X
Certificates in authorized denominations.
Section
2.09 Establishment
of Trust.
The
Depositor does hereby establish, pursuant to the further provisions of this
Agreement and the laws of the State of New York, an express trust to be known,
for convenience, as “Nomura Asset Acceptance Corporation, Alternative Loan
Trust, Series 2006-AR3” and does hereby appoint HSBC Bank USA, National
Association, as Trustee in accordance with the provisions of this
Agreement.
Section
2.10 Purpose
and Powers of the Trust.
The
purpose of the common law trust, as created hereunder, is to engage in the
following activities:
(a) acquire
and hold the Mortgage Loans and the other assets of the Trust Fund and the
proceeds therefrom;
(b) to
issue
the Certificates sold to the Depositor in exchange for the Mortgage
Loans;
(c) to
make
payments on the Certificates;
(d) to
engage
in those activities that are necessary, suitable or convenient to accomplish
the
foregoing or are incidental thereto or connected therewith; and
(e) subject
to compliance with this Agreement, to engage in such other activities as may
be
required in connection with conservation of the Trust Fund and the making of
distributions to the Certificateholders.
The
trust
is hereby authorized to engage in the foregoing activities. The Trustee shall
not cause the trust to engage in any activity other than in connection with
the
foregoing or other than as required or authorized by the terms of this Agreement
while any Certificate is outstanding, and this Section 2.10 may not be amended,
without the consent of the Certificateholders evidencing 51% or more of the
aggregate voting rights of the Certificates.
ARTICLE
III
ADMINISTRATION
AND SERVICING OF THE MORTGAGE LOANS; ACCOUNTS
Section
3.01 GMACM
to act as Servicer of the related Mortgage Loans.
The
obligations of GMACM hereunder to service and administer the Mortgage Loans
shall be limited to the GMAC Mortgage Loans, and with respect to the duties
and
obligations of GMACM, references herein to the related Mortgage Loans shall
be
limited to the GMACM Mortgage Loans (and the related proceeds thereof and
related REO Properties) and references to the related Servicer or such Servicer
in connection with the performance of the servicing obligations specified in
this Agreement and all obligations arising hereunder by the related Servicer
in
connection with the servicing of the related Mortgage Loans shall be deemed
to
be references to GMACM or any successor thereto responsible for the servicing
and administration of the GMACM Mortgage Loans pursuant to the terms of this
Agreement. The Wachovia Mortgage Loans will be serviced and administered by
Wachovia pursuant to the terms and provisions of the Servicing Agreement and
Wachovia shall have no obligation to adhere to the provisions of this Agreement
in connection with the servicing and administration of the Wachovia Mortgage
Loans. In addition, GMACM will have no responsibility to service or administer
the Wachovia Mortgage Loans or have any other obligation or liability with
respect to the Wachovia Mortgage Loans or the Servicing Agreement.
The
related Servicer shall service and administer the related Mortgage Loans on
behalf of the Trust Fund and in the best interest of and for the benefit of
the
Certificateholders (as determined by such Servicer in its reasonable judgment)
in accordance with the terms of this Agreement and the related Mortgage Loans
and to the extent consistent with such terms and in accordance with and
exercising the same care in performing those practices that such Servicer
customarily employs and exercises in servicing and administering mortgage loans
for its own account and of the same type as such Mortgage Loans in the
jurisdiction in which the related Mortgaged Properties are located (including,
compliance with all applicable federal, state and local laws).
To
the
extent consistent with the foregoing, the related Servicer shall seek the timely
and complete recovery of principal and interest on the Mortgage Notes related
to
the Mortgage Loans and shall waive a Prepayment Charge only under the following
circumstances: (i) such waiver is standard and customary in servicing similar
mortgage loans and (ii) either (A) such waiver is related to a default or
reasonably foreseeable default and would, in the reasonable judgment of the
related Servicer, maximize recovery of total proceeds taking into account the
value of such Prepayment Charge and the related Mortgage Loan and, if such
waiver is made in connection with a refinancing of the related Mortgage Loan,
such refinancing is related to a default or a reasonably foreseeable default
or
(B) such waiver is made in connection with a refinancing of the related Mortgage
Loan unrelated to a default or a reasonably foreseeable default where (x) the
related Mortgagor has stated to the related Servicer an intention to refinance
the related Mortgage Loan and (y) the related Servicer has concluded in its
reasonable judgment that the waiver of such Prepayment Charge would induce
such
Mortgagor to refinance with the related Servicer or (iii) the related Servicer
reasonably believes such Prepayment Charge is unenforceable in accordance with
applicable law or the collection of such related Prepayment Charge would
otherwise violate applicable law. If a Prepayment Charge is waived as permitted
by meeting both of the standards described in clauses (i) and (ii)(B) above,
then the related Servicer is required to pay the amount of such waived
Prepayment Charge (the “Servicer Prepayment Charge Payment Amount”), for the
benefit of the Holders of the Class P Certificates, by depositing such amount
into the related Custodial Account within ninety (90) days of notice or
discovery of such waiver meeting the standard set forth in both clauses (i)
and
(ii)(B) above; provided, however, that the related Servicer shall not waive
more
than five percent (5%) of the Prepayment Charges (by number of Prepayment
Charges) set forth on the Mortgage Loan Schedule in accordance with clauses
(i)
and (ii)(B) above. Notwithstanding any other provisions of this Agreement,
any
payments made by the related Servicer in respect of any waived Prepayment
Charges pursuant to clauses (i) and (ii)(B) above and the preceding sentence
shall be deemed to be paid outside of the Trust Fund.
Notwithstanding
anything to the contrary contained in this Agreement, if the related Servicer
waives a Prepayment Charge in breach of the foregoing paragraph, such Servicer
will pay the amount of such waived Prepayment Charge, from its own funds without
any right of reimbursement, for the benefit of the Holders of the Class P
Certificates, by depositing such amount into the Custodial Account within ninety
(90) days of the earlier of discovery by the related Servicer or receipt of
notice by the related Servicer of such breach. Furthermore, notwithstanding
any
other provisions of this Agreement, any payments made by the related Servicer
in
respect of any waived Prepayment Charges pursuant to this paragraph shall be
deemed to be paid outside of the Trust Fund.
Subject
only to the above-described applicable servicing standards (the “Accepted
Servicing Practices”) and the terms of this Agreement and of the respective
Mortgage Loans, the related Servicer shall have full power and authority, acting
alone and/or through Subservicers as provided in Section 3.03, to do or
cause to be done any and all things that it may deem necessary or desirable
in
connection with such servicing and administration, including but not limited
to,
the power and authority, subject to the terms hereof (i) to execute and deliver,
on behalf of the Certificateholders and the Trustee, customary consents or
waivers and other instruments and documents, (ii) to consent to transfers of
any
related Mortgaged Property and assumptions of the Mortgage Notes and related
Mortgages (but only in the manner provided herein), (iii) to collect any
Insurance Proceeds and other Liquidation Proceeds, and (iv) subject to
Section 3.09, to effectuate foreclosure or other conversion of the
ownership of the Mortgaged Property securing any Mortgage Loan serviced by
such
Servicer.
Without
limiting the generality of the foregoing, the related Servicer, in its own
name
or in the name of the Trust, the Depositor or the Trustee, is hereby authorized
and empowered by the Trust, the Depositor and the Trustee, when such Servicer
believes it appropriate in its reasonable judgment, to execute and deliver,
on
behalf of the Trustee, the Depositor, the Certificateholders or any of them,
any
and all instruments of satisfaction or cancellation, or of partial or full
release or discharge and all other comparable instruments, with respect to
the
related Mortgage Loans, and with respect to the related Mortgaged Properties
held for the benefit of the Certificateholders. The related Servicer shall
prepare and deliver to the Depositor and/or the Trustee such documents requiring
execution and delivery by any or all of them as are necessary or appropriate
to
enable the related Servicer to service and administer the related Mortgage
Loans. Upon receipt of such documents, the Depositor and/or the Trustee shall
execute such documents and deliver them to the related Servicer. In addition,
the Trustee shall execute, at the written request of a Servicer, and furnish
to
it any special or limited powers of attorney agreeable to the Trustee and its
counsel applicable to all locations in which the Mortgaged Properties are
located and other documents necessary or appropriate to enable such Servicer
to
carry out its servicing and administrative duties hereunder or under the
Servicing Agreement, provided such limited powers of attorney or other documents
shall be prepared by the related Servicer and submitted to the Trustee for
review prior to execution. Notwithstanding anything to the contrary herein,
the
Trustee shall in no way be liable or responsible for the willful malfeasance
of
a Servicer, or for the wrongful or negligent actions taken by a Servicer, while
such Servicer is acting pursuant to the powers granted to it in this
paragraph.
In
accordance with the standards of the first paragraph of this Section 3.01,
the related Servicer shall advance or cause to be advanced funds as necessary
for the purpose of effecting the payment of taxes and assessments on the
Mortgaged Properties relating to the related Mortgage Loans in order to preserve
the lien on the related Mortgaged Property, which advances shall be reimbursable
in the first instance from related collections from the Mortgagors pursuant
to
Section 3.27, and further as provided in Section 3.32. All costs
incurred by a Servicer, if any, in effecting the payments of such taxes and
assessments on the related Mortgaged Properties and related insurance premiums
shall not, for the purpose of calculating monthly distributions to the
Certificateholders, be added to the Stated Principal Balance under the related
Mortgage Loans, notwithstanding that the terms of such Mortgage Loans so
permit.
Section
3.02 Due-on-Sale
Clauses; Assumption Agreements.
(a) Except
as
otherwise provided in this Section 3.02, when any Mortgaged Property has
been or is about to be conveyed by the Mortgagor, the related Servicer shall
to
the extent that it has knowledge of such conveyance, enforce any due-on-sale
clause contained in any Mortgage Note or Mortgage, to the extent permitted
under
applicable law and governmental regulations, but only to the extent that such
enforcement will not adversely affect or jeopardize coverage under any Required
Insurance Policy. Notwithstanding the foregoing, no Servicer shall be required
to exercise such rights with respect to a Mortgage Loan serviced by such
Servicer if the Person to whom the related Mortgaged Property has been conveyed
or is proposed to be conveyed satisfies the terms and conditions contained
in
the Mortgage Note and Mortgage related thereto and the consent of the mortgagee
under such Mortgage Note or Mortgage is not otherwise so required under such
Mortgage Note or Mortgage as a condition to such transfer. In the event that
the
related Servicer is prohibited by law from enforcing any such due-on-sale
clause, or if coverage under any Required Insurance Policy would be adversely
affected, or if nonenforcement is otherwise permitted hereunder, such Servicer
is authorized, subject to Section 3.02(b), to take or enter into an
assumption and modification agreement from or with the person to whom such
property has been or is about to be conveyed, pursuant to which such person
becomes liable under the Mortgage Note and, unless prohibited by applicable
state law, the Mortgagor remains liable thereon, provided that the related
Mortgage Loan shall continue to be covered (if so covered before the related
Servicer enters into such an agreement) by the applicable Required Insurance
Policies. The related Servicer, subject to Section 3.02(b), is also
authorized with the prior approval of the insurers under any Required Insurance
Policies 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 Mortgagor and becomes liable under the Mortgage Note.
Notwithstanding the foregoing, no Servicer shall be deemed to be in default
under this Section 3.02(a) by reason of any transfer or assumption that
such Servicer reasonably believes it is restricted by law from
preventing.
(b) Subject
to the related Servicer’s duty to enforce any due-on-sale clause to the extent
set forth in Section 3.02(a), in any case in which a Mortgaged Property has
been conveyed to a Person by a Mortgagor, and such Person is to enter into
an
assumption agreement or modification agreement or supplement to the Mortgage
Note or Mortgage that requires the signature of the Trustee, or if an instrument
of release signed by the Trustee is required releasing the Mortgagor from
liability on the related Mortgage Loan, the related Servicer shall prepare
and
deliver or cause to be prepared and delivered to the Trustee for signature
and
shall direct, in writing, the Trustee to execute the assumption agreement with
the Person to whom the Mortgaged Property is to be conveyed and such
modification agreement or supplement to the Mortgage Note or Mortgage or other
instruments as are reasonable or necessary to carry out the terms of the
Mortgage Note or Mortgage or otherwise to comply with any applicable laws
regarding assumptions or the transfer of the Mortgaged Property to such Person.
In connection with any such assumption, no material term of the Mortgage Note
(including, but not limited to, (a) the Mortgage Rate, (b) the amount of the
Scheduled Payment, (c) the related Index, Gross Margin, Periodic Rate Cap,
Adjustment Date, Maximum Interest Rate or Minimum Mortgage Interest Rate, and
(d) any other term affecting the amount or timing of payment on the related
Mortgage Loan) may be changed. In addition, the substitute Mortgagor and the
Mortgaged Property must be acceptable to the related Servicer in accordance
with
the servicing standard set forth in Section 3.01. The related Servicer
shall notify the Trustee that any such substitution or assumption agreement
has
been completed by forwarding to the Custodian the original of such substitution
or assumption agreement, which in the case of the original 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. Any fee collected by a Servicer for entering into
an assumption or substitution of liability agreement will be retained by such
Servicer as additional servicing compensation.
Section
3.03 Subservicers.
The
related Servicer shall perform all of its servicing responsibilities hereunder
or may cause a Subservicer to perform any such servicing responsibilities on
its
behalf, but the use by such Servicer of a Subservicer shall not release such
Servicer from any of its obligations hereunder with respect to the related
Mortgage Loans. Any subservicing arrangement and the terms of the related
Subservicing Agreement must provide for the servicing of such Mortgage Loans
in
a manner consistent with the servicing arrangements contemplated hereunder
and
the related Servicer shall cause any Subservicer to comply with the provisions
of this Agreement (including, without limitation, to provide the information
required to be delivered under Sections 3.13, 3.14 and 3.18 hereof), to the
same
extent as if such Subservicer were the related Servicer. Each Subservicer shall
be (i) authorized to transact business in the state or states where 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 and (ii) a Xxxxxxx Mac or Xxxxxx
Mae approved mortgage servicer. The related Servicer shall promptly, upon
request, provide to the Master Servicer, the Trustee and the Depositor a written
description (in form and substance satisfactory to the Master Servicer, the
Trustee and the Depositor) of the role and function of each Subservicer utilized
by such Servicer, specifying (i) the identity of each such Subservicer, (ii)
which (if any) of such Subservicer is “participating in the servicing function”
within the meaning of Item 1122 of Regulation AB, and (iii) which elements
of
the Servicing Criteria will be addressed in assessments of compliance provided
by each Subservicer identified pursuant to clause (ii) of this subsection;
provided, however, that no Servicer shall be required to provide the information
in clause (i) or (ii) of this subsection until such time that the applicable
assessment of compliance is due in accordance with Section 3.14 of this
Agreement. The related Servicer shall be responsible for obtaining from each
Subservicer engaged by it and delivering to the Master Servicer any annual
statement of compliance, assessment of compliance, attestation report and
Xxxxxxxx-Xxxxx related certification as and when required to be delivered.
The
related Servicer shall pay all fees of each of its Subservicers from its own
funds.
Notwithstanding
the foregoing, with respect to the related Mortgage Loans, the related Servicer
shall be entitled to outsource one or more separate servicing functions to
any
person that does not meet the eligibility requirements for a Subservicer (each
such person, a “Subcontractor”), so long as such outsourcing does not constitute
the delegation of such Servicer’s obligation to perform all or substantially all
of the servicing of the related Mortgage Loans to such Subcontractor. The
related Servicer shall promptly, upon request, provide to the Master Servicer,
the Trustee and the Depositor a written description (in form and substance
satisfactory to the Master Servicer, the Trustee and the Depositor) of the
role
and function of each Subcontractor utilized by such Servicer, specifying (i)
the
identity of each such Subcontractor, (ii) which (if any) of such Subservicer
and
Subcontractors are “participating in the servicing function” within the meaning
of Item 1122 of Regulation AB, and (iii) which elements of the Servicing
Criteria will be addressed in assessments of compliance provided by each
Subcontractor identified pursuant to clause (ii) of this subsection. In such
event, the use by a Servicer of any such Subcontractor shall not release such
Servicer from any of its obligations hereunder and such Servicer shall remain
responsible hereunder for all acts and omissions of such Subcontractor as fully
as if such acts and omissions were those of the related Servicer, and the
related Servicer shall pay all fees and expenses of the Subcontractor from
the
related Servicer’s own funds.
As
a
condition to the utilization of any Subcontractor determined to be
“participating in the servicing function” within the meaning of Item 1122 of
Regulation AB, the related Servicer shall cause any such Subcontractor used
by
it for the benefit of the Master Servicer, the Trustee and the Depositor to
comply with the provisions of Sections 3.13, 3.14 and 3.18 of this Agreement
to
the same extent as if such Subcontractor were such Servicer. The related
Servicer shall be responsible for obtaining from each Subcontractor and
delivering to the Master Servicer, the Trustee and any Depositor any compliance
statement, assessment of compliance, attestation report and Xxxxxxxx-Xxxxx
related certification required to be delivered by such Subcontractor under
Section 3.13, 3.14 and 3.18, in each case as and when required to be
delivered.
At
the
cost and expense of the related Servicer, without any right of reimbursement
from the related Custodial Account, such Servicer shall be entitled to terminate
the rights and responsibilities of a Subservicer or Subcontractor and arrange
for any servicing responsibilities to be performed by a successor Subservicer
or
Subcontractor; provided, however, that nothing contained herein shall be deemed
to prevent or prohibit the related Servicer, at its option, from electing to
service the related Mortgage Loans itself. In the event that the related
Servicer’s responsibilities and duties under this Agreement are terminated
pursuant to Section 8.01, such Servicer shall at its own cost and expense
terminate the rights and responsibilities of each Subservicer and Subcontractor
with respect to the related Mortgage Loans effective as of the date of such
Servicer’s termination. The related Servicer shall pay all fees, expenses or
penalties necessary in order to terminate the rights and responsibilities of
each Subservicer and Subcontractor from such Servicer’s own funds without
reimbursement from the Trust Fund.
Notwithstanding
the foregoing, no Servicer shall be relieved of its obligations hereunder with
respect to the related Mortgage Loans and shall be obligated to the same extent
and under the same terms and conditions as if it alone were servicing and
administering the related Mortgage Loans. The related Servicer shall be entitled
to enter into an agreement with a Subservicer or Subcontractor, as applicable,
for indemnification of such Servicer by the Subservicer or Subcontractor, as
applicable, and nothing contained in this Agreement shall be deemed to limit
or
modify such indemnification.
Any
Subservicing Agreement and any other transactions or services relating to the
Mortgage Loans involving a Subservicer or Subcontractor shall be deemed to
be
between such Subservicer or Subcontractor and the related Servicer alone, and
neither the Master Servicer nor the Trustee shall have any obligations, duties
or liabilities with respect to such Subservicer or Subcontractor including
any
obligation, duty or liability of Master Servicer or the Trustee to pay such
Subservicer’s or Subcontractor’s fees and expenses or any differential in the
amount of the servicing fee paid hereunder and the amount necessary to induce
any successor servicer to act as successor servicer under this Agreement and
the
transactions provided for in this Agreement. For purposes of remittances to
the
Securities Administrator pursuant to this Agreement, the related Servicer shall
be deemed to have received a payment on a Mortgage Loan when a Subservicer
or
Subcontractor engaged by such Servicer has received such payment.
Section
3.04 Documents,
Records and Funds in Possession of a Servicer To Be Held for
Trustee.
Notwithstanding
any other provisions of this Agreement, the related Servicer shall transmit
to
the Trustee as required by this Agreement all documents and instruments in
respect of a Mortgage Loan serviced by such Servicer coming into the possession
of such Servicer from time to time and shall account fully to the Securities
Administrator for any funds received by such Servicer or that otherwise are
collected by such Servicer as Liquidation Proceeds or Insurance Proceeds in
respect of any such Mortgage Loan. All Mortgage Files and funds collected or
held by, or under the control of, a Servicer in respect of any Mortgage Loans
serviced by such Servicer, whether from the collection of principal and interest
payments or from Liquidation Proceeds, including but not limited to, any funds
on deposit in the related Custodial Account, shall be held by such Servicer
for
and on behalf of the Trustee and shall be and remain the sole and exclusive
property of the Trustee, subject to the applicable provisions of this Agreement.
The related Servicer also agrees that it shall not create, incur or subject
any
Mortgage File or any funds that are deposited in the related Custodial Account,
the Distribution Account or in any Escrow Account, or any funds that otherwise
are or may become due or payable to the Trustee for the benefit of the
Certificateholders, to any claim, lien, security interest, judgment, levy,
writ
of attachment or other encumbrance, or assert by legal action or otherwise
any
claim or right of set off against any Mortgage File or any funds collected
on,
or in connection with, a Mortgage Loan, except, however, that such Servicer
shall be entitled to set off against and deduct from any such funds any amounts
that are properly due and payable to the related Servicer under this
Agreement.
Section
3.05 Maintenance
of Hazard Insurance.
(a) The
related Servicer shall cause to be maintained for each Mortgage Loan serviced
by
such Servicer hazard insurance with extended coverage on the Mortgaged Property
in an amount which is at least equal to the lesser of (i) the Stated Principal
Balance of such Mortgage Loan and (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, 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 related Servicer shall also cause to be
maintained hazard 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 REO Property and (ii) the Stated
Principal Balance of the related Mortgage Loan at the time it became an REO
Property. The related 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 collected by the related Servicer under any such policies
(other than amounts to be applied to the restoration or repair of the property
subject to the related Mortgage or amounts to be released to the Mortgagor
in
accordance with the procedures that such Servicer would follow in servicing
loans held for its own account, subject to the terms and conditions of the
related Mortgage and Mortgage Note and in accordance with the servicing standard
set forth in Section 3.01) shall be deposited in the related Custodial
Account, subject to withdrawal pursuant to Section 3.27. Any cost incurred
by the related Servicer in maintaining any such insurance shall not, for the
purpose of calculating distributions to related Certificateholders, be added
to
the Stated 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 a 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 related Servicer shall
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 Stated Principal
Balance of the related Mortgage Loan and (ii) the maximum amount of such
insurance available for the related Mortgaged Property under the national flood
insurance program (assuming that the area in which such Mortgaged Property
is
located is participating in such program).
In
the
event that the related Servicer shall obtain and maintain a blanket policy
with
an insurer acceptable to Xxxxxx Xxx or Xxxxxxx Mac, or having a General Policy
Rating of B:VI or better in Best’s Key Rating Guide (or such other rating that
is comparable to such rating) insuring against hazard losses on all of the
Mortgage Loans serviced by such Servicer, it shall conclusively be deemed to
have satisfied its obligations as set forth in the first two sentences of this
Section 3.05, it being understood and agreed that such policy may contain a
deductible clause, in which case the related 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 3.05, and there shall have been one or more losses which would have
been covered by such policy, deposit to the related Custodial Account maintained
by such Servicer 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 related Mortgage Loans, the
related Servicer agrees to prepare and present, on behalf of itself, the Trustee
and Certificateholders, claims under any such blanket policy in a timely fashion
in accordance with the terms of such policy.
(b) The
related 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 such Servicer’s obligations under this Agreement, which policy or
policies shall be in such form and amount that would meet the requirements
of
Xxxxxx Mae or Xxxxxxx Mac if it were the purchaser of the Mortgage Loans, unless
such Servicer has obtained a waiver of such requirements from Xxxxxx Mae or
Xxxxxxx Mac. The related Servicer shall provide the Master Servicer, upon
request, with copies of such insurance policies and fidelity bond (or waiver
thereof). The related Servicer shall also maintain a fidelity bond in the form
and amount that would meet the requirements of Xxxxxx Mae or Xxxxxxx Mac, unless
such Servicer has obtained a waiver of such requirements from Xxxxxx Mae or
Xxxxxxx Mac. The related Servicer shall be deemed to have complied with this
provision if one of its Affiliates 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 such Servicer. Any such errors and
omissions policy and fidelity bond shall by its terms not be cancelable without
thirty (30) days’ prior written notice to the Master Servicer. The related
Servicer shall also cause its Subservicers to maintain a policy of insurance
covering errors and omissions and a fidelity bond which would meet such
requirements.
Section
3.06 Presentment
of Claims and Collection of Proceeds.
The
related Servicer shall prepare and present on behalf of the Trustee and the
Certificateholders all claims under the applicable Insurance Policies and take
such actions (including the negotiation, settlement, compromise or enforcement
of the insured’s claim) as shall be necessary to realize recovery under such
Insurance Policies. Any proceeds disbursed to the related Servicer in respect
of
such Insurance Policies shall, within two Business Days of its receipt, be
deposited in the related Custodial Account, except that any amounts realized
that are to be applied to the repair or restoration of the related Mortgaged
Property as a condition precedent to the presentation of claims on the related
Mortgage Loan to the insurer under any applicable Insurance Policy need not
be
so deposited (or remitted).
Section
3.07 Maintenance
of Insurance Policies.
The
related Servicer shall not take any action that would result in noncoverage
under any applicable Insurance Policy of any loss which, but for the actions
of
such Servicer would have been covered thereunder. The related Servicer shall
use
its best efforts to keep in force and effect (to the extent that the related
Mortgage Loan requires the Mortgagor to maintain such insurance), any applicable
Insurance Policy. The related Servicer shall not cancel or refuse to renew
any
Insurance Policy that is in effect at the date of the initial issuance of the
Mortgage Note and is required to be kept in force hereunder.
Section
3.08 Reserved.
Section
3.09 Realization
Upon Defaulted Mortgage Loans; Determination of Excess Liquidation Proceeds
and
Realized Losses; Repurchases of Certain Mortgage Loans.
(a) The
related Servicer shall use reasonable efforts to foreclose upon or otherwise
comparably convert the ownership of properties securing such of the Mortgage
Loans serviced by such Servicer as come into and continue in default and as
to
which no satisfactory arrangements can be made for collection of delinquent
payments. In connection with such foreclosure or other conversion, the related
Servicer shall follow such practices and procedures as it shall deem necessary
or advisable and as shall be normal and usual in its general mortgage servicing
activities and the requirements of the insurer under any Required Insurance
Policy; provided that the related Servicer shall not be required to expend
its
own funds in connection with any foreclosure or towards the restoration of
any
property unless it shall determine (i) that such restoration and/or foreclosure
will increase the proceeds of liquidation of the related Mortgage Loan after
reimbursement to itself of such expenses and (ii) that such expenses will be
recoverable to it through Liquidation Proceeds (respecting which it shall have
priority for purposes of withdrawals from the related Custodial Account). If
a
Mortgage Loan becomes 180 days delinquent and the related Servicer, in its
reasonable good faith judgment, determines that the recovery of principal with
respect to such Mortgage Loan will not materially be in excess of the cost
of
foreclosure or other liquidation of the Mortgage Loan, then the related Servicer
will be deemed to have made a Final Recovery Determination with respect to
such
Mortgage Loan and the related Servicer may charge off such Mortgage Loan at
any
time thereafter. If the related Servicer reasonably believes that Liquidation
Proceeds with respect to any such Mortgage Loan would not be increased as a
result of such foreclosure or other action, such Mortgage Loan will be
charged-off and will become a Liquidated Loan. The related Servicer will give
notice of any such charge-off to the Securities Administrator. The related
Servicer shall be responsible for all other costs and expenses incurred by
it in
any such proceedings; provided that such costs and expenses shall be Servicing
Advances and that it shall be entitled to reimbursement thereof from the
proceeds of liquidation of the related Mortgaged Property, as contemplated
in
Section 3.27. If the related Servicer has knowledge that a Mortgaged
Property that such Servicer is contemplating acquiring in foreclosure or by
deed-in-lieu of foreclosure is located within a one-mile radius of any site
with
environmental or hazardous waste risks known to such Servicer, such Servicer
shall, prior to acquiring the Mortgaged Property, consider such risks and only
take action in accordance with its established environmental review
procedures.
With
respect to any REO Property, the deed or certificate of sale shall be taken
in
the name of the Trustee for the benefit of the related Certificateholders (or
the Trustee’s nominee on behalf of the related Certificateholders). The
Trustee’s name shall be placed on the title to such REO Property solely as the
Trustee hereunder and not in its individual capacity. The related Servicer
shall
ensure that the title to such REO Property references this Agreement and the
Trustee’s capacity hereunder. Pursuant to its efforts to sell such REO Property,
the related Servicer shall either itself or through an agent selected by such
Servicer protect and conserve such REO Property in the same manner and to such
extent as is customary in the locality where such REO Property is located and
may, incident to its conservation and protection of the interests of the related
Certificateholders, rent the same, or any part thereof, as such Servicer deems
to be in the best interest of such Servicer and the related Certificateholders
for the period prior to the sale of such REO Property. The related Servicer
shall prepare for and deliver to the Securities Administrator a statement with
respect to each REO Property that has been rented showing the aggregate rental
income received and all expenses incurred in connection with the management
and
maintenance of such REO Property at such times as is necessary to enable the
Securities Administrator to comply with the reporting requirements of the REMIC
Provisions. The net monthly rental income, if any, from such REO Property shall
be deposited in the related Custodial Account no later than the close of
business on each Determination Date. The related Servicer shall perform the
tax
reporting and withholding related to foreclosures, abandonments and cancellation
of indebtedness income as specified by Sections 6050H, 6050J and 6050P of the
Code by preparing and filing such tax and information returns, as may be
required.
In
the
event that the Trust Fund acquires any Mortgaged Property as aforesaid or
otherwise in connection with a default or imminent default on a Mortgage Loan,
the related Servicer shall dispose of such Mortgaged Property prior to three
years after its acquisition by the Trust Fund or, at the expense of the Trust
Fund, request from the Internal Revenue Service more than 60 days prior to
the
day on which such three-year period would otherwise expire, an extension of
the
three-year grace period. The Trustee and the Securities Administrator shall
be
supplied with an Opinion of Counsel (such opinion not to be an expense of the
Trustee, the Securities Administrator or the Trust Fund) to the effect that
the
holding by the Trust Fund of such Mortgaged Property subsequent to such
three-year period will not result in the imposition of taxes on “prohibited
transactions” of REMIC I as defined in section 860F of the Code or cause REMIC I
to fail to qualify as a REMIC at any time that any Certificates are outstanding,
in which case the Trust Fund may continue to hold such Mortgaged Property
(subject to any conditions contained in such Opinion of Counsel).
Notwithstanding any other provision of this Agreement, no Mortgaged Property
acquired by the Trust Fund shall be rented (or allowed to continue to be rented)
or otherwise used for the production of income by or on behalf of the Trust
Fund
in such a manner or pursuant to any terms that would (i) cause such Mortgaged
Property to fail to qualify as “foreclosure property” within the meaning of
section 860G(a)(8) of the Code or (ii) subject REMIC I to the imposition of
any
federal, state or local income taxes on the income earned from such Mortgaged
Property under section 860G(c) of the Code or otherwise, unless the related
Servicer has agreed to indemnify and hold harmless the Trust Fund with respect
to the imposition of any such taxes.
The
decision of the related Servicer to foreclose on a defaulted Mortgage Loan
shall
be subject to a determination by such Servicer that the proceeds of such
foreclosure would exceed the costs and expenses of bringing such a proceeding.
The income earned from the management of any Mortgaged Properties acquired
through foreclosure or other judicial proceeding, net of reimbursement to the
related Servicer for expenses incurred (including any property or other taxes)
in connection with such management and net of unreimbursed Servicing Fees,
Advances, Servicing Advances and any management fee paid or to be paid with
respect to the management of such Mortgaged Property, shall be applied to the
payment of principal of, and interest on, the defaulted Mortgage Loans (with
interest accruing as though such Mortgage Loans were still current) and all
such
income shall be deemed, for all purposes in the Agreement, to be payments on
account of principal and interest on the related Mortgage Notes and shall be
deposited into the related Custodial Account. To the extent the income received
during a Prepayment Period is in excess of the amount attributable to amortizing
principal and accrued interest at the related Mortgage Rate on the Mortgage
Loan, such excess shall be considered to be a partial Principal Prepayment
for
all purposes hereof.
The
Liquidation Proceeds from any liquidation of a Mortgage Loan, net of any payment
to the related Servicer as provided above, shall be deposited in the related
Custodial Account on the next succeeding Determination Date following receipt
thereof for distribution on the related Distribution Date, except that any
Excess Liquidation Proceeds shall be retained by the related Servicer as
additional servicing compensation.
The
proceeds of any Liquidated Loan, as well as any recovery resulting from a
partial collection of Liquidation Proceeds or any income from an REO Property,
shall be applied in the following order of priority: first, to reimburse the
related Servicer for any related unreimbursed Servicing Advances and Servicing
Fees, pursuant to Section 3.27 or this Section 3.09; second, to
reimburse the related Servicer for any unreimbursed Advances, pursuant to
Section 3.27 or this Section 3.09; third, to accrued and unpaid
interest (to the extent no Advance has been made for such amount) on the
Mortgage Loan or related REO Property, at the Net Mortgage Rate to the first
day
of the month in which such amounts are required to be distributed; and fourth,
as a recovery of principal of the Mortgage Loan.
(b) On
each
Determination Date, the related Servicer shall determine the respective
aggregate amounts of Excess Liquidation Proceeds and Realized Losses, if any,
with respect to any Mortgage Loan for the related Prepayment Period and report
the same to the Securities Administrator pursuant to Section 3.28.
(c) The
related Servicer hereby covenants to the parties hereto that it has no intent
to
foreclose on any Mortgage Loan serviced by such Servicer based on the
delinquency characteristics as of the Closing Date; provided, however, that
the
foregoing does not prevent the related Servicer from initiating foreclosure
proceedings on any date hereafter if the facts and circumstances of such
Mortgage Loans including delinquency characteristics in the related Servicer’s
discretion so warrant such action.
Section
3.10 Servicing
Compensation.
As
compensation for its activities hereunder, the related Servicer shall be
entitled to retain or withdraw from the related Custodial Account out of each
payment of interest on each Mortgage Loan serviced by such Servicer included
in
the Trust Fund an amount equal to the Servicing Fee. In addition, the related
Servicer shall be entitled to recover any unpaid Servicing Fees payable to
it
out of Liquidation Proceeds, Insurance Proceeds or condemnation proceeds related
to the Mortgage Loans to the extent permitted by Section 3.27.
Additional
servicing compensation with respect to Mortgage Loans in the form of any Excess
Liquidation Proceeds, assumption fees, late payment charges, insufficient funds
charges and ancillary income to the extent such fees or charges are received
by
the related Servicer, all income and gain net of any losses realized from
Permitted Investments with respect to funds in or credited to the related
Custodial Account shall be retained by such Servicer to the extent not required
to be deposited in such Custodial Account pursuant to Section 3.27. The
related Servicer shall be required to pay all expenses incurred by it in
connection with its servicing activities hereunder (including payment of any
premiums for hazard insurance, as required by Section 3.05 and maintenance
of the other forms of insurance coverage required by Section 3.07 and shall
not be entitled to reimbursement therefor except as specifically provided
herein.
Section
3.11 REO
Property.
(a) In
the
event the Trust Fund acquires ownership of any REO Property in respect of any
related Mortgage Loan, the deed or certificate of sale shall be issued to the
Trustee, or to its nominee, on behalf of the related Certificateholders. The
related Servicer shall sell any REO Property as expeditiously as possible and
in
accordance with the provisions of this Agreement. Pursuant to its efforts to
sell such REO Property, the related Servicer shall protect and conserve such
REO
Property in the manner and to the extent required herein, in accordance with
the
REMIC Provisions.
(b) The
related Servicer shall deposit all funds collected and received in connection
with the operation of any REO Property into the related Custodial
Account.
(c) The
related Servicer, upon the final disposition of any REO Property, shall be
entitled to reimbursement for any related unreimbursed Advances, unreimbursed
Servicing Advances or Servicing Fees from Liquidation Proceeds received in
connection with the final disposition of such REO Property; provided, that
any
such unreimbursed Advances or Servicing Fees as well as any unpaid Servicing
Fees may be reimbursed or paid, as the case may be, prior to final disposition,
out of any net rental income or other net amounts derived from such REO
Property.
Section
3.12 Liquidation
Reports.
Upon
the
foreclosure of any Mortgaged Property or the acquisition thereof by the Trust
Fund pursuant to a deed-in-lieu of foreclosure, the related Servicer shall
submit a liquidation report to the Trustee containing such information as shall
be mutually acceptable to the Servicer and the Trustee with respect to such
Mortgaged Property.
Section
3.13 Annual
Statement as to Compliance.
(a) The
related Servicer, the Master Servicer and the Securities Administrator shall
deliver or otherwise make available (and shall cause each Servicing Function
Participant engaged by it to deliver) to the Depositor and the Securities
Administrator, and in the case of the Master Servicer, to the Trustee on or
before March 15 of each year, commencing in March 2007, an Officer’s Certificate
stating, as to the signer thereof, that (A) a review of such party’s activities
during the preceding calendar year or portion thereof and of such Servicing
Function Participant’s performance under this Agreement, or such other
applicable agreement in the case of a Servicing Function Participant, has been
made under such officer’s supervision and (B) to the best of such officer’s
knowledge, based on such review, such party has fulfilled all its obligations
under this Agreement, or such other applicable agreement in the case of a
Servicing Function Participant (other than the related Servicer, the Master
Servicer or the Securities Administrator), in all material respects throughout
such year or portion thereof, or, if there has been a failure to fulfill any
such obligation in any material respect, specifying each such failure known
to
such officer and the nature and status thereof.
(b) (i)For
so
long as the Trust Fund is subject to Exchange Act reporting requirements,
failure of the related Servicer to comply timely with this Section 3.13 shall
be
deemed a Servicer Default as to such Servicer, without any cure period, and
the
Master Servicer shall notify the Trustee and the Trustee may, in addition to
whatever rights the Master Servicer or the Trustee, as applicable, may have
under this Agreement and at law or in equity or to damages, including injunctive
relief and specific performance, terminate all the rights and obligations of
such Servicer under this Agreement and in and to the related Mortgage Loans
and
the proceeds thereof without compensating such Servicer for the same. The Master
Servicer or the Trustee, as applicable, shall so terminate the defaulting
Servicer by delivery of notice thereof via first class mail, facsimile or
electronic mail. This paragraph shall supersede any other provision in this
Agreement or any other agreement to the contrary.
(ii) After
the
Trust Fund ceases to be subject to Exchange Act reporting requirements, failure
of the related Servicer to comply timely with this Section 3.13 shall be deemed
a Servicer Default as provided for in Section 8.01(a)(ix). The Master Servicer
shall notify the Trustee and the Trustee may, terminate the defaulting Servicer
by delivery of notice thereof via first class mail, facsimile or electronic
mail.
(c) The
Master Servicer shall include all annual statements of compliance received
by it
from the related Servicer and any Servicing Function Participant with its own
annual statement of compliance to be submitted to the Securities Administrator
pursuant to this Section 3.13.
(d) Copies
of
any Master Servicer annual statements of compliance required to be delivered
hereunder shall be provided to any Certificateholder upon request at the Master
Servicer’s expense.
(e) In
the
event the related Servicer, the Master Servicer, the Securities Administrator
or
any other Servicing Function Participant is terminated or resigns pursuant
to
the terms of this Agreement, or any applicable agreement in the case of such
other Servicing Function Participant, as the case may be, such party shall
provide or cause such other Servicing Function Participant to provide an
Officer’s Certificate pursuant to this Section 3.13 with respect to the period
of time it was subject to this Agreement or any other applicable agreement,
as
the case may be.
Section
3.14 Assessments
of Compliance and Attestation Reports.
(a) By
March
15 of each year, commencing in March 2007, the related Servicer, the Master
Servicer and the Securities Administrator, each at its own expense and pursuant
to Item 1122(a) of Regulation AB, shall furnish or otherwise make available,
and
shall cause any Servicing Function Participant engaged by it to furnish, which
in each case shall not be an expense of the Trust Fund, to the Securities
Administrator and the Depositor, a report on an assessment of compliance with
the Relevant Servicing Criteria that contains (A) a statement by such party
of
its responsibility for assessing compliance with the Relevant Servicing
Criteria, (B) a statement that such party used the Relevant Servicing Criteria
to assess compliance with the Relevant Servicing Criteria, (C) such party’s
assessment of compliance with the Relevant Servicing Criteria for the period
consisting of the prior calendar year, including, if there has been any material
instance of noncompliance with the Relevant Servicing Criteria, a discussion
of
each such failure and the nature and status thereof, and (D) a statement that
a
registered public accounting firm has issued an attestation report on such
party’s assessment of compliance with the Relevant Servicing Criteria for the
period consisting of the prior calendar year.
(b) No
later
than the end of each calendar year, the related Servicer and the Master Servicer
shall forward to the Securities Administrator and the Depositor, the name of
each Servicing Function Participant engaged by it and what Relevant Servicing
Criteria will be addressed in the report on assessment of compliance prepared
by
such Servicing Function Participant; provided, however, that the Master Servicer
need not provide such information to the Securities Administrator so long as
the
Master Servicer and the Securities Administrator are the same entity. When
the
related Servicer and the Master Servicer (or any Servicing Function Participant
engaged by them) submit their assessments to the Securities Administrator,
such
parties will also at such time include the assessment (and attestation pursuant
to paragraph (c) below) of each Servicing Function Participant engaged by it.
Promptly
after receipt of each such report on assessment of compliance, (i) the Depositor
shall review each such report and, if applicable, consult with the related
Servicer, the Master Servicer, the Securities Administrator and any Servicing
Function Participant engaged by such parties as to the nature of any material
instance of noncompliance with the Relevant Servicing Criteria by each such
party, and (ii) the Securities Administrator shall confirm that the assessments,
taken as a whole, address all of the Servicing Criteria and taken individually
address the Relevant Servicing Criteria for each party as set forth on Exhibit
L
and on any similar exhibit set forth in the Servicing Agreement in respect
of
Wachovia, and notify the Depositor of any exceptions.
In
the
event a Servicing Function Participant is terminated, assigns its rights and
obligations under, or resigns pursuant to the terms of this Agreement, or any
other applicable agreement, as the case may be, such party shall provide, or
cause a Servicing Function Participant engaged by it to provide, a report on
assessment of compliance pursuant to this Section 3.14 with respect to the
period of time it was subject to this Agreement or any other applicable
agreement, as the case may be.
The
Master Servicer shall include such annual report on assessment of compliance
with its own assessment of compliance to be submitted to the Securities
Administrator pursuant to this Section.
(c) By
March
15 of each year, commencing in March 2007, the related Servicer, the Master
Servicer and the Securities Administrator, each at its own expense, shall cause,
and shall cause any Servicing Function Participant engaged by such party to
cause, which in each case shall not be an expense of the trust, a registered
public accounting firm (which may also render other services to such Servicing
Function Participants) and that is a member of the American Institute of
Certified Public Accountants to furnish a report to the Master Servicer and
Securities Administrator to the effect that (i) it has obtained a representation
regarding certain matters from the management of such party, which includes
an
assertion that such party has complied with the Relevant Servicing Criteria,
and
(ii) on the basis of an examination conducted by such firm in accordance with
standards for attestation engagements issued or adopted by the PCAOB, it is
expressing an opinion as to whether such party’s compliance with the Relevant
Servicing Criteria was fairly stated in all material respects, or it cannot
express an overall opinion regarding such party’s assessment of compliance with
the Relevant Servicing Criteria. In the event that an overall opinion cannot
be
expressed, such registered public accounting firm shall state in such report
why
it was unable to express such an opinion. Such report must be available for
general use and not contain restricted use language.
Promptly
after receipt of such report from a Servicing Function Participant, the
Securities Administrator shall confirm that each assessment submitted pursuant
to paragraph (a) above is coupled with an attestation meeting the requirements
of this Section and notify the Depositor of any exceptions.
The
Master Servicer shall include each such attestation with its own attestation
to
be submitted to the Securities Administrator pursuant to this
Section.
In
the
event any Servicing Function Participant is terminated, assigns its rights
and
duties under, or resigns pursuant to the terms of this Agreement, or any other
applicable agreement, as the case may be, such party shall cause a registered
public accounting firm to provide an attestation pursuant to this Section 3.14
with respect to the period of time it was subject to this Agreement or any
applicable subservicing agreement, as the case may be.
(d) (i)For
so
long as the Trust Fund is subject to Exchange Act reporting requirements,
failure of the related Servicer to comply timely with this Section 3.14 shall
be
deemed a Servicer Default as to such Servicer, automatically, without notice
and
without any cure period, and the Master Servicer shall notify the Trustee and
the Trustee may, in addition to whatever rights the Master Servicer or the
Trustee, as applicable, may have under this Agreement and at law or in equity
or
to damages, including injunctive relief and specific performance, terminate
all
the rights and obligations of such Servicer under this Agreement and in and
to
the related Mortgage Loans and the proceeds thereof without compensating the
Servicer for the same. The Trustee shall so terminate the defaulting Servicer
by
delivery of notice thereof via first class mail, facsimile or electronic mail.
This paragraph shall supersede any other provision in this Agreement or any
other agreement to the contrary.
(ii) After
the
Trust Fund ceases to be subject to Exchange Act reporting requirements, failure
of the related Servicer to comply timely with this Section 3.14 shall be deemed
a Servicer Default as provided for in Section 8.01(a)(ix). The Trustee may
terminate the defaulting Servicer by delivery of notice thereof via first class
mail, facsimile or electronic mail.
Section
3.15 Books
and Records.
The
related Servicer shall be responsible for maintaining, and shall maintain,
a
complete set of books and records for the Mortgage Loans serviced by such
Servicer which shall be appropriately identified in such Servicer’s computer
system to clearly reflect the ownership of the Mortgage Loans by the Trust.
In
particular, the related Servicer shall maintain in its possession, available
for
inspection by the Trustee and the Master Servicer and shall deliver to the
Trustee or the Master Servicer upon reasonable prior request and during normal
business hours, evidence of compliance with all federal, state and local laws,
rules and regulations. To the extent that original documents are not required
for purposes of realization of Liquidation Proceeds or Insurance Proceeds,
documents maintained by the related Servicer may be in the form of microfilm
or
microfiche or such other reliable means of recreating original documents,
including, but not limited to, optical imagery techniques so long as the related
Servicer complies with the requirements of Accepted Servicing
Practices.
The
related Servicer shall maintain with respect to each Mortgage Loan serviced
by
such Servicer and shall upon reasonable prior request and during normal business
hours make available for inspection by the Trustee and the Master Servicer
the
related servicing file during the time such Mortgage Loan is subject to this
Agreement and thereafter in accordance with applicable law.
Section
3.16 The
Trustee.
The
Trustee shall furnish the Servicers with any powers of attorney and other
documents prepared and submitted by the Servicers to the Trustee in a form
as
mutually agreed upon and necessary or appropriate to enable each Servicer to
service and administer the related Mortgage Loans and REO
Properties.
The
Trustee shall provide access to the records and documentation in possession
of
the Trustee regarding the related Mortgage Loans and REO Property and the
servicing thereof to the Certificateholders, the FDIC, and the supervisory
agents and examiners of the FDIC, such access being afforded only upon
reasonable prior written request and during normal business hours at the office
of the Trustee; provided, however, that, unless otherwise required by law,
the
Trustee shall not be required to provide access to such records and
documentation if the provision thereof would violate the legal right to privacy
of any Mortgagor. The Trustee shall allow representatives of the above entities
to photocopy any of the records and documentation and shall provide equipment
for that purpose at a charge that covers the Trustee’s actual
costs.
The
Trustee shall execute and deliver as directed in writing by the Servicer any
court pleadings, requests for trustee’s sale or other documents necessary or
desirable to (i) the foreclosure or trustee’s sale with respect to a Mortgaged
Property; (ii) any legal action brought to obtain judgment against any Mortgagor
on the Mortgage Note; (iii) obtain a deficiency judgment against the Mortgagor;
or (iv) enforce any other rights or remedies provided by the Mortgage Note
or
otherwise available at law or equity.
Section
3.17 REMIC-Related
Covenants.
For
as
long as each REMIC shall exist, the Trustee and the Securities Administrator
shall act in accordance herewith to treat each REMIC as a REMIC, and the Trustee
and the Securities Administrator shall comply with any directions of the
Sponsor, the Servicers or the Master Servicer with respect to such treatment.
In
particular, the Trustee shall not (a) knowingly sell or permit the sale of
all
or any portion of the Mortgage Loans or of any investment of deposits in an
Account unless such sale is as a result of a repurchase of the Mortgage Loans
pursuant to this Agreement or the Trustee has received a REMIC Opinion prepared
at the expense of the Trust Fund; and (b) other than with respect to a
substitution pursuant to the Mortgage Loan Purchase Agreement or
Section 2.04 of this Agreement, as applicable, accept any contribution to
any REMIC after the Startup Day without receipt of a REMIC Opinion.
Section
3.18 Annual
Xxxxxxxx-Xxxxx Certification; Additional Information.
(a) The
related Servicer, the Master Servicer and the Securities Administrator shall
and
shall cause any Servicing Function Participant engaged by such party to, provide
to the Certifying Person, by March 15 of each year in which the Trust Fund
is
subject to the reporting requirements of the Exchange Act and otherwise within
a
reasonable period of time upon request, a certification (each, a “Back-Up
Certification”),
in
the form attached hereto as Exhibit
M,
upon
which the Certifying Person, the entity for which the Certifying Person acts
as
an officer, and such entity’s officers, directors and Affiliates (collectively
with the Certifying Person, “Certification
Parties”)
can
reasonably rely. The senior officer of the Master Servicer in charge of the
master servicing function shall prepare a Xxxxxxxx-Xxxxx Certification and
sign
the same on behalf of the Trust Fund serving as the “Certifying Person”. Such
officer of the Certifying Person can be contacted by e-mail at or
by
facsimile at (000) 000-0000. In the event the related Servicer, the Master
Servicer or the Securities Administrator, or any Servicing Function Participant
engaged by such party, is terminated or resigns pursuant to the terms of this
Agreement, or any other applicable agreement, as the case may be, such party
shall provide a Back-Up Certification to the Certifying Person pursuant to
this
Section 3.18 with respect to the period of time it was subject to this Agreement
or any other applicable agreement, as the case may be.
Notwithstanding
the foregoing, (i) the Master Servicer and the Securities Administrator shall
not be required to deliver a Back-Up Certification to each other if each is
the
same Person and the Master Servicer is the Certifying Person and (ii) the Master
Servicer shall not be obligated to execute any Xxxxxxxx-Xxxxx Certification
in
the event that it does not receive a Back-Up Certification from any party
required to deliver such Back-Up Certification pursuant to this Section or
the
Custodial Agreement; provided, however, in the event the Master Servicer shall
not be required to execute a Xxxxxxxx-Xxxxx Certification pursuant to clause
(ii), the Master Servicer shall prepare such Xxxxxxxx-Xxxxx Certification and
deliver it to the Depositor for execution.
(b) The
related Servicer shall provide (or shall cause each Subservicer or Subcontractor
to provide) to the Master Servicer, the Securities Administrator and the
Depositor prompt notice and a description of the occurrence of any of the
following:
(i) any
Servicer Default with respect to such Servicer under the terms of this
Agreement, any merger, consolidation or sale of substantially all of the assets
of such Servicer, such Servicer’s engagement of any Subservicer to perform or
assist in the performance of any of such Servicer’s obligations under this
Agreement, any material litigation or governmental proceedings involving such
Servicer (or any of its Subservicers or Subcontractors, as applicable), and
any
affiliation or other significant relationship between such Servicer (or any
of
its Subservicers or Subcontractors, as applicable) and other transaction
parties.
(ii) As
a
condition to the succession to the related Servicer or any Subservicer as
servicer or subservicer under this Agreement by any Person (i) into which such
Servicer or such Subservicer may be merged or consolidated, or (ii) which may
be
appointed as a successor to such Servicer or any Subservicer, such Servicer
shall provide to the Sponsor, Depositor, Master Servicer and Securities
Administrator at least fifteen (15) calendar days prior to the effective date
of
such succession or appointment, (x) written notice and all information
reasonably requested to the Sponsor, Depositor, Master Servicer and Securities
Administrator of such succession or appointment and (y) in writing and in form
and substance reasonably satisfactory to the Sponsor, Depositor, Master Servicer
and Securities Administrator in order to comply with the reporting obligations
under Item 6.02 of Form 8-K.
(iii) If
the
related Servicer or any Servicing Function Participant engaged by such Servicer
has knowledge of the occurrence of any of the events described in this clause
(iii), then no later than ten days prior to the deadline for the filing of
any
Distribution Report on Form 10-D in respect of any Trust Fund that includes
any
of the Mortgage Loans serviced by such Servicer or any Subservicer, such
Servicer shall provide (or cause such Subservicer to provide) to the Master
Servicer and Securities Administrator notice of the occurrence of any of the
following events along with all information, data, and materials related thereto
as may be required to be included in the related Distribution Report on Form
10-D (as specified in the provisions of Regulation AB referenced
below):
(A) any
material modifications, extensions or waivers of pool asset terms, fees,
penalties or payments during the distribution period or that have cumulatively
become material over time (Item 1121(a)(11) of Regulation AB);
(B) material
breaches of pool asset representations or warranties or transaction covenants
of
such Servicer (Item 1121(a)(12) of Regulation AB); and
(C) information
regarding any material pool asset changes (such as, additions, substitutions
or
repurchases).
(c) The
related Servicer shall provide to the Master Servicer and the Securities
Administrator such additional information as the Master Servicer may reasonably
request, including evidence of the authorization of the person signing any
certification or statement, financial information and reports and of the
fidelity bond and errors and omissions insurance policy required to be
maintained by such Servicer pursuant to this Agreement, and such other
information related to such Servicer or any Servicing Function Participant
engaged by such Servicer or its performance hereunder or other applicable
agreement.
Section
3.19 Release
of Mortgage Files.
(a) Upon
becoming aware of the payment in full of any Mortgage Loan, or the receipt
by
the related Servicer of a notification that payment in full has been escrowed
in
a manner customary for such purposes for payment to Certificateholders on the
next Distribution Date, such Servicer will (or if such Servicer does not, the
Master Servicer may) promptly furnish to the Trustee and the Custodian, on
behalf of the Trustee, two copies of a request for release substantially in
the
form attached to the Custodial Agreement signed by an Authorized Servicer
Representative or in a mutually agreeable electronic format which will, in
lieu
of a signature on its face, originate from an Authorized Servicer Representative
(which certification shall include a statement to the effect that all amounts
received in connection with such payment that are required to be deposited
in
the related Custodial Account pursuant to Article V have been or will be so
deposited) and shall request that the Custodian, on behalf of the Trustee,
deliver to the related Servicer the related Mortgage File. Within five (5)
Business Days of receipt of such certification and request, the Custodian,
on
behalf of the Trustee, shall release the related Mortgage File to the related
Servicer and the Trustee and the Custodian shall have no further responsibility
with regard to such Mortgage File. Upon any such payment in full, the related
Servicer is authorized, to give, as agent for the Trustee, as the mortgagee
under the Mortgage that secured the related Mortgage Loan, an instrument of
satisfaction (or assignment of mortgage without recourse) regarding the
Mortgaged Property subject to the Mortgage, which instrument of satisfaction
or
assignment, as the case may be, shall be delivered to the Person or Persons
entitled thereto against receipt therefor of such payment, it being understood
and agreed that no expenses incurred in connection with such instrument of
satisfaction or assignment, as the case may be, shall be chargeable to the
related Custodial Account.
(b) From
time
to time and as appropriate for the servicing or foreclosure of any Mortgage
Loan
and in accordance with this Agreement, the Trustee shall execute such documents
as shall be prepared and furnished to the Trustee by the related Servicer (in
form reasonably acceptable to the Trustee) and as are necessary to the
prosecution of any such proceedings. The Custodian, on behalf of the Trustee,
shall, upon the written request of the related Servicer, and delivery to the
Custodian, on behalf of the Trustee, of two copies of a request for release
signed by an Authorized Servicer Representative substantially in the form
attached to the Custodial Agreement (or in a mutually agreeable electronic
format which will, in lieu of a signature on its face, originate from an
Authorized Servicer Representative), release the related Mortgage File held
in
its possession or control to the related Servicer. Such request for release
shall obligate the related Servicer to return the Mortgage File to the Custodian
on behalf of the Trustee, when the need therefor by such Person no longer exists
unless the Mortgage Loan shall be liquidated, in which case, upon receipt of
a
certificate of an Authorized Servicer Representative similar to that hereinabove
specified, the Mortgage File shall be released by the Custodian, on behalf
of
the Trustee, to the related Servicer.
Section
3.20 Documents,
Records and Funds in Possession of the Servicers to be held for
Trustee.
(a)
The
related Servicer (to the extent required by this Agreement or the Servicing
Agreement, as applicable) shall transmit to the Trustee or the Custodian such
documents and instruments coming into the possession of such Servicer from
time
to time as are required by the terms hereof to be delivered to the Trustee
or
the Custodian. Any funds received by the related Servicer in respect of any
Mortgage Loan serviced by such Servicer or which otherwise are collected by
such
Servicer as Liquidation Proceeds or Insurance Proceeds in respect of any
Mortgage Loan shall be held for the benefit of the Trustee and the
Certificateholders subject to the right of such Servicer to retain its Servicing
Fee and other amounts as provided in this Agreement or the related Servicing
Agreement, as applicable.
Section
3.21 Possession
of Certain Insurance Policies and Documents.
The
related Servicer shall retain possession and custody of the originals (to the
extent available) of any Insurance Policies, or certificate of insurance if
applicable, and any certificates of renewal as to the foregoing as may be issued
from time to time that comes into the possession of such Servicer, as
contemplated by this Agreement. Until all amounts distributable in respect
of
the Certificates have been distributed in full, the Trustee (or the Custodian,
as directed by the Trustee) shall retain possession and custody of each Mortgage
File in accordance with and subject to the terms and conditions of this
Agreement.
Section
3.22 [Reserved].
Section
3.23 [Reserved].
Section
3.24 Optional
Purchase of Certain Mortgage Loans.
With
respect to any Mortgage Loan which is delinquent in payment by ninety-one (91)
days or more or is an REO Property, the Sponsor shall have the right to purchase
such Mortgage Loan or REO Property from the Trust Fund at a price equal to
the
Purchase Price. The Purchase Price shall be remitted to the related Servicer
for
deposit in the related Custodial Account and remitted by the Servicer to the
Securities Administrator on the Servicer Remittance Date in the month
immediately following the month in which the Purchase Price was deposited in
the
related Custodial Account.
In
addition, the Sponsor shall, at its option, purchase any Mortgage Loan from
the
Trust if the first or second Due Date for such Mortgage Loan is subsequent
to
the Cut-off Date and the first or second Monthly Payment is not made within
thirty (30) days of such Due Date. Such purchase shall be made at a price equal
to the Purchase Price.
If
at any
time the Sponsor remits to the related Servicer a payment for deposit in the
related Custodial Account covering the amount of the Purchase Price for such
a
Mortgage Loan and the related Servicer delivers an Officer’s Certificate to the
Trustee (which shall be delivered no later than two (2) Business Days following
such deposit) certifying that the Purchase Price has been deposited in the
related Custodial Account, the Trustee shall execute the assignment of such
Mortgage Loan at the request of the Sponsor without recourse to the Sponsor
which shall succeed to all the Trustee’s, right, title and interest in and to
such Mortgage Loan, and all security and documents relative thereto. Such
assignment shall be an assignment outright and not for security. The Sponsor
will thereupon own such Mortgage, and all such security and documents, free
of
any further obligation to the Trustee or the related Certificateholders with
respect thereto. The Sponsor shall be responsible for any transfer costs
incurred with respect to a Mortgage Loan purchased pursuant to this
Section 3.24.
If
the
Sponsor is required to repurchase a Mortgage Loan pursuant to this Section
3.24,
the related Servicer shall continue to service such Mortgage Loan unless the
Sponsor shall repurchase the servicing rights thereon on terms mutually agreed
to by the Sponsor and the related Servicer. Notwithstanding the foregoing,
the
Master Servicer shall have no obligation to master service any Mortgage Loan
that has been so repurchased.
Section
3.25 Obligations
of the Servicers Under Credit Risk Management Agreements.
Notwithstanding
anything in this Agreement or the Credit Risk Management Agreements to the
contrary, the Trustee shall not have any duty or obligation to enforce any
Credit Risk Management Agreement or to supervise, monitor or oversee the
activities of the Credit Risk Manager or the Servicers under the Credit Risk
Management Agreements or this Agreement with respect to any action taken or
not
taken by the related Servicer pursuant to a recommendation of the Credit Risk
Manager or otherwise in connection with obligations of the related Servicer
under the related Credit Risk Management Agreement.
Section
3.26 Collection
of Mortgage Loan Payments; Custodial Accounts.
(a) The
related Servicer shall make reasonable efforts in accordance with Accepted
Servicing Practices to collect all payments called for under the terms and
provisions of the related Mortgage Loans to the extent such procedures shall
be
consistent with this Agreement and the terms and provisions of any related
Required Insurance Policy. Consistent with the foregoing, the related Servicer
may in its discretion (i) waive any late payment charge and (ii) extend the
due
dates for payments due on a Mortgage Note for a Mortgage Loan serviced by such
Servicer for a period not greater than 180 days; provided, however no such
extension shall be materially adverse to the Certificateholders. In the event
of
any such arrangement, the related Servicer shall make Advances on the Mortgage
Loan during the scheduled period in accordance with the amortization schedule
of
such Mortgage Loan without modification thereof by reason of such arrangements,
and shall be entitled to reimbursement therefor in accordance with
Section 5.01. The related Servicer shall not be required to institute or
join in litigation with respect to collection of any payment (whether under
a
Mortgage, Mortgage Note or otherwise or against any public or governmental
authority with respect to a taking or condemnation) if it reasonably believes
that enforcing the provision of the Mortgage or other instrument pursuant to
which such payment is required is prohibited by applicable law. In addition,
if
(x) a Mortgage Loan is in default or default is imminent or (y) the related
Servicer delivers to the Trustee and the Securities Administrator a REMIC
Opinion, the related Servicer may, (A) amend the related Mortgage Note to reduce
the Mortgage Rate applicable thereto, and (B) amend any Mortgage Note for a
Mortgage Loan to extend the maturity thereof.
(b) The
related Servicer shall establish and maintain a segregated Custodial Account
(which shall at all times be an Eligible Account) with a depository institution
and shall be in the name of such Servicer in trust for registered holders of
Nomura Asset Acceptance Corporation, Mortgage Pass-Through Certificates, Series
2006-AR3. On behalf of the Trust Fund, the related Servicer shall deposit or
cause to be deposited in the clearing account in which it customarily deposits
payments and collection 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 such Servicer’s receipt thereof, and shall thereafter deposit in the
related Custodial Account, in no event more than two Business Days after the
related Servicer’s receipt thereof, except as otherwise specifically provided
herein, the following payments and collections remitted by Subservicers or
received by it in respect of the Mortgage Loans subsequent to the Cut-off Date
(other than in respect of principal and interest due on the related Mortgage
Loans on or before the Cut-off Date) and the following amounts required to
be
deposited hereunder:
(i) all
payments on account of principal, including Principal Prepayments and Subsequent
Recoveries, on the related Mortgage Loans;
(ii) all
payments on account of interest on the related Mortgage Loans net of the
Servicing Fee permitted under Section 3.10;
(iii) all
Liquidation Proceeds, Insurance Proceeds and condemnation proceeds with respect
to the related Mortgage Loans, other than proceeds to be applied to the
restoration or repair of the related Mortgaged Properties or released to the
Mortgagor in accordance with the related Servicer’s normal servicing
procedures;
(iv) any
amount required to be deposited by the related Servicer pursuant to
Section 3.26(c) in connection with any losses on Permitted
Investments;
(v) any
amounts required to be deposited by the related Servicer pursuant to
Section 3.05;
(vi) any
amounts paid by an Advance Financing Person in respect of Advances or Servicing
Advances;
(vii) any
Prepayment Charges collected by the related Servicer in connection with the
Principal Prepayment of any of the related Mortgage Loans and any Servicer
Prepayment Charge Payment Amounts;
(viii) the
Purchase Price with respect to any related Mortgage Loans purchased by the
Sponsor pursuant to Section 2.02 or 2.03, any amounts which are to be
treated pursuant to Section 2.04 of this Agreement as the payment of such a
Purchase Price and the Purchase Price with respect to any related Mortgage
Loans
purchased by the Sponsor pursuant to Section 3.24; and
(ix) any
other
amounts required to be deposited hereunder.
The
foregoing requirements for deposit by the related Servicer into the related
Custodial 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 or assumption fees, if collected, need not be deposited by
the
related Servicer. In the event that the related Servicer shall deposit any
amount not required to be deposited and not otherwise subject to withdrawal
pursuant to Section 3.27, it may at any time withdraw or direct the
institution maintaining the related Custodial Account, to withdraw such amount
from the related Custodial Account, any provision herein to the contrary
notwithstanding. Such withdrawal or direction may be accomplished by delivering
written notice thereof to the institution maintaining the related Custodial
Account, that describes the amounts deposited in error in such Custodial
Account. The related Servicer shall maintain adequate records with respect
to
all withdrawals made pursuant to this Section. All funds deposited in a
Custodial Account shall be held in trust for the Certificateholders until
withdrawn in accordance with Section 3.27.
(c) The
institution that maintains any Custodial Account, or other authorized entity
shall invest the funds in such Custodial Account, in the manner directed by
the
related Servicer, in Permitted Investments which shall mature not later than
the
next succeeding Remittance Date and shall not be sold or disposed of prior
to
its maturity. All such Permitted Investments shall be made in the name of the
Trustee, for the benefit of the Certificateholders. All income and gain net
of
any losses realized from any such investment shall be for the benefit of the
related Servicer as servicing compensation and shall be remitted to it monthly
as provided herein. The amount of any losses incurred in a Custodial Account
in
respect of any such investments shall be deposited by the related Servicer
into
such Custodial Account immediately as realized, out of its own
funds.
(d) The
related Servicer shall give at least thirty (30) days’ advance notice to the
Trustee, the Securities Administrator, the Master Servicer, the Sponsor, each
Rating Agency and the Depositor of any proposed change of location of the
related Custodial Account prior to any change thereof.
Section
3.27 Permitted
Withdrawals From the Custodial Accounts.
(a) The
related Servicer may from time to time make withdrawals from the related
Custodial Account for the following purposes:
(i) to
pay
itself (to the extent not previously paid to or withheld by the related
Servicer), as servicing compensation in accordance with Section 3.10, that
portion of any payment of interest that equals the Servicing Fee for the period
with respect to which such interest payment was made, and, as additional
servicing compensation, those other amounts set forth in
Section 3.10;
(ii) to
reimburse the related Servicer or an Advance Financing Person for (A) any
unreimbursed Advances to the extent of amounts received which represent late
recoveries of payments of principal and/or interest (net of the related
Servicing Fees), Liquidation Proceeds and Insurance Proceeds on the related
Mortgage Loans with respect to which such Advances were made in accordance
with
the provisions of Section 5.01; and (B) any unreimbursed Advances with
respect to the final liquidation of a related Mortgage Loan that are
Nonrecoverable Advances, but only to the extent that late recoveries of payments
of principal and/or interest, Liquidation Proceeds and Insurance Proceeds
received with respect to such Mortgage Loan are insufficient to reimburse the
related Servicer or an Advance Financing Person for such unreimbursed Advances
or (C) subject to Section 3.27(b), any unreimbursed Advances to the extent
of Amounts Held For Future Distribution funds held in the related Custodial
Account relating to the Mortgage Loans that were not included in the Available
Distribution Amount for the preceding Distribution Date;
(iii) to
reimburse itself or an Advance Financing Person for any Nonrecoverable
Advances;
(iv) to
reimburse itself from Insurance Proceeds for Insured Expenses covered by the
related Insurance Policy;
(v) to
pay
itself any unpaid Servicing Fees and to reimburse itself or any Advance
Financing Person for any unreimbursed Servicing Advances, provided, however,
that the related Servicer’s or such Advance Financing Person’s right to
reimbursement for Servicing Advances pursuant to this subclause (v) with respect
to any Mortgage Loan shall be limited to amounts received on particular Mortgage
Loan(s) (including, for this purpose, late recoveries of payments of principal
and/or interest, Liquidation Proceeds, Insurance Proceeds, condemnation proceeds
and purchase and repurchase proceeds) that represent late recoveries of the
payments for which such Servicing Advances were made;
(vi) to
pay to
the Sponsor or the Depositor with respect to each related Mortgage Loan or
property acquired in respect thereof that has been purchased pursuant to
Section 2.02, 2.03 or 3.24, all amounts received thereon and not taken into
account in determining the related Stated Principal Balance of such repurchased
Mortgage Loan;
(vii) to
pay
any expenses reimbursable pursuant to Section 7.04;
(viii) to
withdraw any amount deposited in the related Custodial Account and not required
to be deposited therein;
(ix) to
clear
and terminate the related Custodial Account upon termination of this Agreement
pursuant to Section 10.01 hereof; and
(x) to
pay
the fee payable to any provider of lender-paid mortgage insurance, if
applicable.
In
addition, no later than noon Eastern time on the Remittance Date, the related
Servicer shall withdraw from the related Custodial Account maintained by such
Servicer and remit to the Securities Administrator (a) all amounts deposited
in
such Custodial Account as of the close of business on the last day of the
related Due Period (net of charges against or withdrawals from such Custodial
Account pursuant to this Section 3.27(a)), plus (b) all Advances, if any,
which the related Servicer is obligated to make pursuant to Section 5.01,
minus (c) any amounts attributable to Principal Prepayments, Liquidation
Proceeds, Insurance Proceeds or condemnation proceeds received after the
applicable Prepayment Period, which amounts shall be remitted on the following
Remittance Date, together with any Compensating Interest required to be
deposited in such Custodial Account in connection with such Principal Prepayment
in accordance with Section 5.02, and minus (d) any amounts attributable to
Scheduled Payments collected but due on a Due Date or Due Dates subsequent
to
the first day of the month in which such Remittance Date occurs, which amounts
shall be remitted on the Remittance Date next succeeding the Due Date related
to
such Scheduled Payment.
With
respect to any remittance received by the Securities Administrator after the
Business Day on which such payment was due, the Securities Administrator shall
send written notice thereof to the related Servicer. The related Servicer shall
pay to the Securities Administrator interest on any such late payment by such
Servicer at an annual rate equal to Prime Rate (as defined in The Wall Street
Journal) plus one percentage point, but in no event greater than the maximum
amount permitted by applicable law. Such interest shall be paid by the related
Servicer to the Securities Administrator on the date such late payment is made
and shall cover the period commencing with the day following the Business Day
on
which such payment was due and ending with the Business Day on which such
payment is made, both inclusive. The payment by the related Servicer of any
such
interest, or the failure of the Securities Administrator to notify the related
Servicer of such interest, shall not be deemed an extension of time for payment
or a waiver of any Servicer Default by the related Servicer.
The
related Servicer shall keep and maintain separate accounting, on a Mortgage
Loan
by Mortgage Loan basis, for the purpose of justifying any withdrawal from the
related Custodial Account pursuant to subclauses (i), (ii), (iv), (v) and (vi)
above. Prior to making any withdrawal from the related Custodial Account
pursuant to subclause (iii), the related Servicer shall deliver to the Master
Servicer an Officer’s Certificate of an Authorized Servicer Representative
indicating the amount of any previous Advance or Servicing Advance determined
by
such Servicer to be a Nonrecoverable Advance and identifying the related
Mortgage Loan(s), and their respective portions of such Nonrecoverable
Advance.
(b) Notwithstanding
the foregoing, any Amounts Held For Future Distribution withdrawn by the related
Servicer as permitted in Section 3.27(a)(ii) in reimbursement of Advances
previously made by such Servicer shall be appropriately reflected in such
Servicer’s records and replaced by such Servicer by deposit in the related
Custodial Account, no later than the close of business on any future Remittance
Date on which the funds on deposit in the related Custodial Account shall be
less than the amount required to be remitted to the Trust Fund on such
Remittance Date; provided, however that if the rating of such Servicer
(including any Successor Servicer) is less than “BBB”, such Servicer shall be
required to replace such funds by deposit to the Distribution Account, no later
than the close of business on the Remittance Date immediately following the
Due
Period or Prepayment Period for which such amounts relate. The amount at any
time credited to the related Custodial Account may be invested by such Servicer
in Permitted Investments.
Section
3.28 Reports
to Master Servicer.
Not
later
than the tenth (10th) calendar day of each month (or if such tenth calendar
day
is not a Business Day, the immediately succeeding Business Day), the related
Servicer shall furnish to the Master Servicer (i) (a) monthly loan data in
a
mutually agreed-upon format containing all of the information set forth in
Exhibit X-1, (b) default loan data in the format set forth in Exhibit X-2 hereto
(or in such other format mutually agreed-upon between such Servicer and the
Master Servicer) and (c) information regarding realized losses and gains in
the
format set forth in Exhibit X-3 hereto (or in such other format mutually agreed
between such Servicer and the Master Servicer), in each case relating to the
period ending on the last day of the preceding calendar month, (ii) all such
information required pursuant to clause (i)(a) above on a magnetic tape,
electronic mail, or other similar media reasonably acceptable to the Master
Servicer and (iii) all supporting documentation with respect to the information
required pursuant to clause (i)(c) above.
Not
later
than two (2) Business Days after the Determination Date of each calendar month,
GMACM shall furnish to the Master Servicer a monthly report containing such
information regarding prepayments of Mortgage Loans during the applicable
Prepayment Period in a format as mutually agreed to between GMACM and the Master
Servicer.
Section
3.29 Collection
of Taxes; Assessments and Similar Items; Escrow Accounts.
To
the
extent required by the Mortgage Note related to a Mortgage Loan, the related
Servicer shall establish and maintain one or more accounts (each, an “Escrow
Account”) and deposit, promptly upon receipt, and retain therein all collections
from the Mortgagors (or advances by such Servicer) for the payment of taxes,
assessments, hazard insurance premiums or comparable items for the account
of
the Mortgagors. Nothing herein shall require the related Servicer to compel
a
Mortgagor to establish an Escrow Account in violation of applicable
law.
Withdrawals
of amounts so collected from the Escrow Accounts may be made only to effect
timely payment of taxes, assessments, hazard insurance premiums, condominium
or
PUD association dues, or comparable items, to reimburse the related Servicer
out
of related collections for any payments made with respect to each Mortgage
Loan
pursuant to Section 3.01 (with respect to taxes and assessments and
insurance premiums) and Section 3.05 (with respect to hazard insurance), to
refund to any Mortgagors any sums as may be determined to be overages, to pay
interest, if required by law or the terms of the related Mortgage or Mortgage
Note, to such Mortgagors on balances in the Escrow Account, to remove amounts
deposited in error or to clear and terminate the Escrow Account at the
termination of this Agreement in accordance with Section 10.01 thereof. The
Escrow Account shall not be a part of the Trust Fund.
Section
3.30 Adjustments
to Mortgage Rate and Scheduled Payment.
On
each
applicable Adjustment Date, the Mortgage Rate with respect to each Mortgage
Loan
shall be adjusted, in compliance with the requirements of the related Mortgage
and Mortgage Note, to equal the sum of the related Index plus the Gross Margin
(rounded in accordance with the related Mortgage Note) subject to the applicable
Periodic Rate Cap, Maximum Mortgage Interest Rate and Minimum Mortgage Interest
Rate, as set forth in the Mortgage Note. The related Servicer shall execute
and
deliver the notices required by each Mortgage and Mortgage Note, applicable
laws
and regulations regarding interest rate adjustments. The related Servicer shall
also provide timely notification to the Master Servicer of all applicable data
and information regarding such interest rate adjustments and such Servicer’s
methods of implementing such interest rate adjustments. Upon the discovery
by a
Servicer or the Master Servicer that such Servicer has failed to adjust a
Mortgage Rate or a Scheduled Payment pursuant to the terms of the related
Mortgage Note and Mortgage, such Servicer shall immediately deposit in the
related Custodial Account, as applicable from its own funds the amount of any
interest loss caused thereby without reimbursement therefor.
Section
3.31 Distribution
Account.
(a) The
Securities Administrator shall establish and maintain in the name of the
Trustee, for the benefit of the Certificateholders a Distribution Account as
a
segregated non-interest bearing trust account or accounts. The Securities
Administrator will deposit in the Distribution Account as identified by the
Securities Administrator and as received by the Securities Administrator, the
following amounts:
(i) All
payments and recoveries in respect of principal on the related Mortgage Loans,
including, without limitation, Principal Prepayments, Subsequent Recoveries,
Liquidation Proceeds, Insurance Proceeds, condemnation proceeds and all payments
and recoveries in respect of interest on the related Mortgage Loans withdrawn
by
the related Servicer from the related Custodial Account and remitted by the
related Servicer to the Securities Administrator;
(ii) Any
Advance and any Compensating Interest Payments;
(iii) Any
Prepayment Charges collected by the related Servicer in connection with the
Principal Prepayment of any of the related Mortgage Loans (including any
Servicer Prepayment Charge Payment Amounts);
(iv) Any
Insurance Proceeds or Liquidation Proceeds received by or on behalf of the
Securities Administrator or which were not deposited in the related Custodial
Account;
(v) The
Purchase Price with respect to any related Mortgage Loans purchased by the
Sponsor or Section 2.02 or 2.03, any amounts which are to be treated
pursuant to Section 2.04 of this Agreement as the payment of such a
Purchase Price, the Purchase Price with respect to any related Mortgage Loans
purchased by the Depositor pursuant to Section 3.24, and all proceeds of
any related Mortgage Loans or property acquired with respect thereto repurchased
by the Master Servicer pursuant to Section 10.01;
(vi) Any
amounts required to be deposited with respect to losses on investments of
deposits in an Account; and
(vii) Any
other
amounts received by or on behalf of the Securities Administrator and required
to
be deposited in the Distribution Account pursuant to this
Agreement.
(b) All
amounts deposited to the Distribution Account shall be held by the Securities
Administrator in the name of the Trustee in trust for the benefit of the
Certificateholders in accordance with the terms and provisions of this
Agreement. The requirements for crediting the Distribution 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 or assumption,
tax service, statement account or payoff, substitution, satisfaction, release
and other like fees and charges, need not be credited by the Securities
Administrator to the Distribution Account.
(c) The
amount at any time credited to the Distribution Account may be invested by
the
Securities Administrator in Permitted Investments that mature no later than
the
Business Day prior to the next succeeding Distribution Date as directed by
the
Master Servicer, unless the investment is managed by the Securities
Administrator or an affiliate of the Securities Administrator, in which case
such Permitted Investments may mature on the Distribution Date. All such
investment income shall be for the benefit of the Master Servicer, and any
losses incurred shall be deposited by the Master Servicer in the Distribution
Account immediately as realized.
Section
3.32 Permitted
Withdrawals and Transfers from the Distribution Account.
(a) The
Securities Administrator will from time to time make or cause to be made such
withdrawals or transfers from the Distribution Account pursuant to this
Agreement for the following purposes:
(i) to
pay to
the Trustee any expenses recoverable by the Trustee pursuant to this
Agreement.
(ii) to
reimburse the related Servicer (or any successor thereto) for any Advance or
Servicing Advance of its own funds, the right of the related Servicer (or any
successor thereto) to reimbursement pursuant to this subclause (ii) being
limited to amounts received on a particular Mortgage Loan (including, for this
purpose, the Purchase Price therefor, Insurance Proceeds, Liquidation Proceeds
and condemnation proceeds) which represent late payments or recoveries of the
principal of or interest on such Mortgage Loan respecting which such Advance
or
Servicing Advance was made;
(iii) to
reimburse the Master Servicer or the related Servicer (or any successor thereto)
from Insurance Proceeds or Liquidation Proceeds relating to a particular
Mortgage Loan for amounts expended by the related Servicer (or any successor
thereto) in good faith in connection with the restoration of the related
Mortgaged Property which was damaged by an uninsured cause or in connection
with
the liquidation of such Mortgage Loan;
(iv) to
reimburse the related Servicer (or any successor thereto) from Insurance
Proceeds relating to a particular Mortgage Loan for insured expenses incurred
with respect to such Mortgage Loan and to reimburse the related Servicer (or
any
successor thereto) from Liquidation Proceeds from a particular Mortgage Loan
for
Liquidation Expenses incurred with respect to such Mortgage Loan;
(v) to
reimburse the related Servicer (or any successor thereto) for advances of funds
pursuant to this Agreement, and the right to reimbursement pursuant to this
subclause being limited to amounts received on the related Mortgage Loan
(including, for this purpose, the Purchase Price therefor, Insurance Proceeds,
Liquidation Proceeds and condemnation proceeds) which represent late recoveries
of the payments for which such advances were made;
(vi) to
reimburse the related Servicer (or any successor thereto) for any Advance or
advance, after a Realized Loss has been allocated with respect to the related
Mortgage Loan if the Advance or advance has not been reimbursed pursuant to
clauses (ii) and (v);
(vii) to
pay
the Credit Risk Management Fee to the Credit Risk Manager; provided, however,
that upon the termination of the Credit Risk Manager pursuant to
Section 3.33 hereof, the amount of the Credit Risk Management Fee (or any
portion thereof) previously payable to the Credit Risk Manager as described
herein shall be paid to the Sponsor;
(viii) to
reimburse the Trustee or the Securities Administrator for expenses, costs and
liabilities incurred by and reimbursable to it pursuant to this Agreement
(including the expenses of the Securities Administrator in connection with
a tax
audit in connection with the performance of its obligations pursuant to
Section 9.13);
(ix) to
pay to
the Trust Fund, as additional servicing compensation, any Excess Liquidation
Proceeds to the extent not retained by the related Servicer;
(x) to
reimburse or pay the related Servicer any such amounts as are due thereto under
this Agreement or the Servicing Agreement and have not been retained by or
paid
to the related Servicer, to the extent provided herein or therein;
(xi) to
reimburse the Trustee or the Master Servicer for expenses incurred in the
transfer of servicing responsibilities of a terminated Servicer after the
occurrence and continuance of a Servicer Default to the extent not paid by
the
terminated Servicer;
(xii) to
reimburse the Master Servicer for any costs and expenses reimbursable to the
Master Servicer pursuant to this Agreement;
(xiii) to
reimburse the Custodian for expenses, costs and liabilities incurred or
reimbursable to it pursuant to this Agreement or the Custodial
Agreement;
(xiv) to
remove
amounts deposited in error; and
(xv) to
clear
and terminate the Distribution Account pursuant to
Section 10.01.
(b) The
Securities Administrator shall keep and maintain separate accounting, on a
Mortgage Loan by Mortgage Loan basis, for the purpose of accounting for any
reimbursement from the Distribution Account pursuant to subclauses (ii) through
(v), inclusive, and (vii) or with respect to any such amounts which would have
been covered by such subclauses had the amounts not been retained by the
Securities Administrator without being deposited in the Distribution Account
under Section 3.31.
(c) On
each
Distribution Date, the Securities Administrator shall distribute the Available
Distribution Amount, to the extent of funds on deposit in the Distribution
Account to the holders of the Certificates in accordance with
Sections 5.04, 5.05 and 5.06.
Section
3.33 Duties
of the Credit Risk Manager; Termination.
(a) The
Depositor appoints Portfolio Surveillance Analytics, LLC, a wholly owned
subsidiary of InformationLogix, Inc. as Credit Risk Manager. For and on behalf
of the Depositor, the Credit Risk Manager will provide reports and
recommendations concerning the Mortgage Loans that are past due, as to which
there has been commencement of foreclosure, as to which there has been
forbearance in exercise of remedies which are in default, as to which a
Mortgagor is the subject of bankruptcy, receivership, or an arrangement of
creditors, or as to which have become REO Properties. Such reports and
recommendations will be based upon information provided to the Credit Risk
Manager pursuant to the related Credit Risk Management Agreement and the Credit
Risk Manager shall look solely to the related Servicer and/or Master Servicer
for all information and data (including loss and delinquency information and
data) and loan level information and data relating to the servicing of the
related Mortgage Loans. If the Credit Risk Manager is no longer able to perform
its duties hereunder, the Credit Risk Manager may be terminated by the Depositor
at the direction of Certificateholders evidencing not less than 66 2/3% of
the
Voting Rights. The Depositor may, at its option, cause the appointment of a
successor Credit Risk Manager. Upon any termination of the Credit Risk Manager
or the appointment of a successor Credit Risk Manager, the Depositor shall
give
written notice thereof to the related Servicer, the Trustee, each Rating Agency
and the Credit Risk Manager. Notwithstanding the foregoing, the termination
of
the Credit Risk Manager pursuant to Section 3.33(b) shall not become
effective until the appointment of a successor Credit Risk Manager. The Trustee
is hereby authorized to enter into any Credit Risk Management Agreement
necessary to effect the foregoing.
(b) Within
six months of the Closing Date, the Sponsor may, at its option, terminate the
Credit Risk Manager if, in its reasonable judgment, (i) the value of the
servicing rights with respect to the Mortgage Loans is adversely affected as
a
result of the presence of the Credit Risk Manager or (ii) the presence of the
Credit Risk Manager impairs the ability of the Sponsor to transfer the servicing
rights with respect to the Mortgage Loans as permitted by this Agreement. Upon
the termination of the Credit Risk Manager, the Sponsor may, at its option,
cause the Depositor to appoint a successor Credit Risk Manager. Notice of such
termination shall be provided by the Sponsor to the Rating Agencies, the
Trustee, the Securities Administrator, the Depositor, the Servicers and the
Credit Risk Manager. Upon the appointment of a successor Credit Risk Manager,
the Depositor shall provide written notice thereof to each Rating Agency, the
Trustee, the Servicer, the Securities Administrator and the Credit Risk
Manager.
If
the
Credit Risk Manager is terminated pursuant to this Section 3.33(b), the
Credit Risk Manager shall only be entitled to a fee equal to 0.0050% with
respect to each Mortgage Loan for the one year period following such
termination. After the expiration of such one year period, the Credit Risk
Manager shall not be entitled to the Credit Risk Management Fee or any portion
thereof with respect to any Mortgage Loan. The excess of the Credit Risk
Management Fee with respect to each Mortgage Loan over the amount payable to
the
Credit Risk Manager as described in this paragraph shall be paid to the Sponsor
pursuant to Section 5.04(a).
Section
3.34 Limitation
Upon Liability of the Credit Risk Manager.
Neither
the Credit Risk Manager, nor any of the directors, officers, employees or agents
of the Credit Risk Manager, shall be under any liability to any Servicer, the
Master Servicer, the Securities Administrator, the Trustee, the
Certificateholders or the Depositor for any action taken or for refraining
from
the taking of any action in good faith pursuant to this Agreement, in reliance
upon information provided by such Servicer and/or Master Servicer under the
related Credit Risk Management Agreement or of errors in judgment; provided,
however, that this provision shall not protect the Credit Risk Manager or any
such person against liability that would otherwise be imposed by reason of
willful malfeasance, bad faith or gross negligence in its performance of its
duties under this Agreement or the applicable Credit Risk Management Agreement.
The Credit Risk Manager and any director, officer, employee or agent of the
Credit Risk Manager may rely in good faith on any document of any kind prima
facie properly executed and submitted by any Person respecting any matters
arising hereunder, and may rely in good faith upon the accuracy of information
furnished by the related Servicer and/or Master Servicer pursuant to the related
Credit Risk Management Agreement in the performance of its duties thereunder
and
hereunder.
ARTICLE
IV
ADMINISTRATION
AND MASTER SERVICING OF THE MORTGAGE LOANS
Section
4.01 The
Master Servicer.
The
Master Servicer shall supervise, monitor and oversee the obligation of the
Servicers
to
service and administer the Mortgage Loans in accordance with the terms of this
Agreement and the Servicing Agreement and shall have full power and authority
to
do any and all things which it may deem necessary or desirable in connection
with such master servicing and administration. In performing its obligations
hereunder, the Master Servicer shall act in a manner consistent with Accepted
Master Servicing Practices. Furthermore, the Master Servicer shall oversee
and
consult with the Servicers as necessary from time-to-time to carry out the
Master Servicer’s obligations hereunder, shall receive, review and evaluate all
reports, information and other data provided to the Master Servicer by the
Servicers and shall cause each Servicer to perform and observe the covenants,
obligations and conditions to be performed or observed by such Servicer under
this Agreement or the Servicing Agreement, as applicable. The Master Servicer
shall independently and separately monitor the servicing activities of the
Servicers with respect to each Mortgage Loan, reconcile the results of such
monitoring with such information provided in the previous sentence on a monthly
basis and coordinate corrective adjustments to the Servicers and Master
Servicer’s records, and based on such reconciled and corrected information,
provide such information relating to the Mortgage Loans to the Securities
Administrator as shall be necessary to enable it to prepare the statements
specified in Section 5.06 and any other information and statements required
to be provided by the Securities Administrator hereunder. The Master Servicer
shall reconcile the results of its Mortgage Loan monitoring with the actual
remittances of the Servicers to the Distribution Account.
Notwithstanding
anything in this Agreement to the contrary, the Master Servicer shall not have
any duty or obligation to enforce any Credit Risk Management Agreement that
each
Servicer is a party to (each, a “Servicer Credit Risk Management Agreement”) or
to supervise, monitor or oversee the activities of the Credit Risk Manager
under
the Servicer Credit Risk Management Agreement with respect to any action taken
or not taken by a Servicer pursuant to a recommendation of the Credit Risk
Manager.
The
Trustee shall furnish the Servicers and the Master Servicer with any limited
powers of attorney and other documents in form acceptable to the Trustee
necessary or appropriate to enable the Servicer and the Master Servicer to
service or master service and administer the Mortgage Loans and REO Property.
The Trustee shall have no responsibility for any action of the Master Servicer
or a Servicer pursuant to any such limited power of attorney and shall be
indemnified by the Master Servicer or the related Servicer for any cost,
liability or expense arising from the misuse thereof by the Master Servicer
or
the related Servicer.
The
Trustee, the Custodian and the Securities Administrator shall provide access
to
the records and documentation in possession of the Trustee, the Custodian or
the
Securities Administrator regarding the Mortgage Loans and REO Property and
the
servicing thereof to the Certificateholders, the FDIC, and the supervisory
agents and examiners of the FDIC, such access being afforded only upon
reasonable prior written request and during normal business hours at the office
of the Trustee, the Custodian or the Securities Administrator; provided,
however, that, unless otherwise required by law, none of the Trustee, the
Custodian or the Securities Administrator shall be required to provide access
to
such records and documentation if the provision thereof would violate the legal
right to privacy of any Mortgagor. The Trustee, the Custodian and the Securities
Administrator shall allow representatives of the above entities to photocopy
any
of the records and documentation and shall provide equipment for that purpose
at
a charge that covers the Trustee’s, the Custodian’s or the Securities
Administrator’s actual costs.
The
Trustee shall execute and deliver to the related Servicer or the Master Servicer
upon request any court pleadings, requests for trustee’s sale or other documents
necessary or desirable and, in each case, provided to the Trustee by the related
Servicer or the Master Servicer to (i) the foreclosure or trustee’s sale with
respect to a Mortgaged Property; (ii) any legal action brought to obtain
judgment against any Mortgagor on the Mortgage Note or any other Loan Document;
(iii) obtain a deficiency judgment against the Mortgagor; or (iv) enforce any
other rights or remedies provided by the Mortgage Note or any other Mortgage
Loan Document or otherwise available at law or equity.
Section
4.02 Monitoring of Servicers.
The
Master Servicer shall be responsible for monitoring the compliance by the
Servicers with their respective duties under this Agreement and the Servicing
Agreement. In the review of each Servicer’s activities, the Master Servicer may
rely upon an officer’s certificate of such Servicer with regard to such
Servicer’s compliance with the terms of this Agreement or the Servicing
Agreement, as applicable. In the event that the Master Servicer, in its
judgment, determines that a Servicer should be terminated in accordance with
this Agreement or the Servicing Agreement, as applicable, or that a notice
should be sent pursuant to this Agreement or the Servicing Agreement, as
applicable with respect to the occurrence of an event that, unless cured, would
constitute grounds for such termination, the Master Servicer shall notify the
Sponsor and the Trustee thereof and the Master Servicer shall issue such notice
or take such other action as it deems appropriate.
The
Master Servicer, for the benefit of the Trustee and the Certificateholders,
shall enforce the obligations of the Servicers under this Agreement and the
Servicing Agreement, and the Master Servicer shall, in the event that a Servicer
fails to perform its obligations in accordance with this Agreement or the
Servicing Agreement, as applicable, subject to this Section, Article VIII
and the Servicing Agreement, terminate the rights and obligations of such
Servicer hereunder or under the Servicing Agreement, as applicable, in
accordance with the provisions of Article VIII or the Servicing Agreement,
as
applicable. The Master Servicer shall act as servicer of the related Mortgage
Loans or enter in to a new servicing agreement with a successor servicer
selected by the Master Servicer; provided, however, it is understood and
acknowledged by the parties hereto that there will be a period of transition
(not to exceed 90 days) before the actual servicing functions can be fully
transferred to the Master Servicer, the Trustee or such successor servicer.
Such
enforcement, including, without limitation, the legal prosecution of claims
and
the pursuit of other appropriate remedies, shall be in such form and carried
out
to such an extent and at such time as the Master Servicer in its good faith
business judgment, would require were it the owner of the related Mortgage
Loans. The Master Servicer shall pay the costs of such enforcement at its own
expense, provided that the Master Servicer shall not be required to prosecute
or
defend any legal action except to the extent that the Master Servicer shall
have
received indemnity reasonably acceptable to it for its costs and expenses in
pursuing such action.
To
the
extent that the costs and expenses related to the termination of a Servicer,
appointment of a Successor Servicer or the transfer and assumption of servicing
by the Master Servicer (including, without limitation, (i) all legal costs
and
expenses and all due diligence costs and expenses associated with an evaluation
of the potential termination of defaulting Servicer as a result of an event
of
default by such Servicer and (ii) all costs and expenses associated with the
complete transfer of servicing, including all servicing files and all servicing
data and the completion, correction or manipulation of such servicing data
as
may be required by the Successor Servicer to correct any errors or
insufficiencies in the servicing data or otherwise to enable the Successor
Servicer to service the related Mortgage Loans in accordance with this Agreement
or the Servicing Agreement, as applicable) are not fully and timely reimbursed
by the terminated Servicer, the Master Servicer shall be entitled to
reimbursement of such costs and expenses from the Distribution
Account.
The
Master Servicer shall require the Servicer to comply with the remittance
requirements and other obligations set forth in this Agreement and the Servicing
Agreement.
If
the
Master Servicer acts as a Successor Servicer, it shall not assume liability
for
the representations and warranties of the terminated Servicer, if any, that
it
replaces.
Section
4.03 Fidelity
Bond.
The
Master Servicer, at its expense, shall maintain in effect a blanket fidelity
bond and an errors and omissions insurance policy that shall be in such form
and
amount generally acceptable for entities serving as master servicers or
trustees, affording coverage with respect to all directors, officers, employees
and other Persons acting on such Master Servicer’s behalf, and covering errors
and omissions in the performance of the Master Servicer’s obligations hereunder.
Any such errors and omissions policy and fidelity bond may not be cancelable
without thirty (30) days’ prior written notice to the Trustee.
Section
4.04 Power
to Act; Procedures.
The
Master Servicer shall master service the Mortgage Loans and shall have full
power and authority, subject to the REMIC Provisions and the provisions of
Section 9.13 hereof, to do any and all things that it may deem necessary or
desirable in connection with the master servicing and administration of the
Mortgage Loans, including but not limited to the power and authority (i) to
execute and deliver, on behalf of the Certificateholders and the Trustee,
customary consents or waivers and other instruments and documents, (ii) to
consent to transfers of any Mortgaged Property and assumptions of the Mortgage
Notes and related Mortgages, (iii) to collect any Insurance Proceeds and
Liquidation Proceeds, and (iv) to effectuate foreclosure or other conversion
of
the ownership of the Mortgaged Property securing any Loan, in each case, in
accordance with the provisions of this Agreement; provided, however, that the
Master Servicer shall not (and, consistent with its responsibilities under
Section 4.02, shall not permit the Servicer to) knowingly or intentionally
take any action, or fail to take (or fail to cause to be taken) any action
reasonably within its control and the scope of duties more specifically set
forth herein, that, under the REMIC Provisions, if taken or not taken, as the
case may be, would cause any REMIC to fail to qualify as a REMIC or result
in
the imposition of a tax upon the Trust Fund (including but not limited to the
tax on prohibited transactions as defined in Section 860F(a)(2) of the Code
and the tax on contributions to a REMIC set forth in Section 860G(d) of the
Code) unless the Master Servicer has received an Opinion of Counsel (but not
at
the expense of the Master Servicer) to the effect that the contemplated action
will not cause any REMIC to fail to qualify as a REMIC or result in the
imposition of a tax upon any REMIC. The Trustee shall furnish the Master
Servicer, upon written request from a Servicing Officer or an Authorized
Servicer Representative, with any powers of attorney (in form acceptable to
Trustee) empowering the Master Servicer, or the related Servicer to execute
and
deliver instruments of satisfaction or cancellation, or of partial or full
release or discharge, and to foreclose upon or otherwise liquidate Mortgaged
Property, and to appeal, prosecute or defend in any court action relating to
the
Mortgage Loans or the Mortgaged Property, in accordance with this Agreement,
and
the Trustee shall execute and deliver such other documents, as the Master
Servicer or the related Servicer may request, to enable the Master Servicer
to
master service and administer the Mortgage Loans and carry out its duties
hereunder, in each case in accordance with Accepted Master Servicing Practices
(and the Trustee shall have no liability for the misuse of any such powers
of
attorney by the Master Servicer or the related Servicer and shall be indemnified
by the Master Servicer or the related Servicer, as applicable, for any costs,
liabilities or expenses incurred by the Trustee in connection with such misuse).
If the Master Servicer or the Trustee has been advised that it is likely that
the laws of the state in which action is to be taken prohibit such action if
taken in the name of the Trustee or that the Trustee would be adversely affected
under the “doing business” or tax laws of such state if such action is taken in
its name, the Master Servicer shall join with the Trustee in the appointment
of
a co-trustee pursuant to Section 9.10 hereof. In the performance of its
duties hereunder, the Master Servicer shall be an independent contractor and
shall not, except in those instances where it is taking action authorized
pursuant to this Agreement to be taken by it in the name of the Trustee, be
deemed to be the agent of the Trustee.
Section
4.05 Due-on-Sale
Clauses; Assumption Agreements.
To
the
extent Mortgage Loans contain enforceable due-on-sale clauses, the Master
Servicer shall cause the Servicers to enforce such clauses in accordance with
this Agreement and the Servicing Agreement. If applicable law prohibits the
enforcement of a due-on-sale clause or such clause is otherwise not enforced
in
accordance with this Agreement, and, as a consequence, a Mortgage Loan is
assumed, the original Mortgagor may be released from liability in accordance
with this Agreement or the Servicing Agreement, as applicable.
Section
4.06 Documents,
Records and Funds in Possession of Master Servicer To Be Held for
Trustee.
The
Master Servicer shall transmit to the Trustee or Custodian such documents and
instruments coming into the possession of the Master Servicer from time to
time
as are required by the terms hereof to be delivered to the Trustee or the
Custodian. Any funds received by the Master Servicer in respect of any Mortgage
Loan or which otherwise are collected by the Master Servicer as Liquidation
Proceeds, Insurance Proceeds or Subsequent Recoveries in respect of any Mortgage
Loan shall be held for the benefit of the Trustee and the Certificateholders
subject to the Master Servicer’s right to retain or withdraw from the
Distribution Account the Master Servicing Compensation and other amounts
provided in this Agreement. The Master Servicer, to the extent required by
Article III or the Servicing Agreement, as applicable, shall cause each Servicer
to, provide access to information and documentation regarding the related
Mortgage Loans to the Trustee, its agents and accountants at any time upon
reasonable request and during normal business hours, and to Certificateholders
that are savings and loan associations, banks or insurance companies, the OTS,
the FDIC and the supervisory agents and examiners of such Office and Corporation
or examiners of any other federal or state banking or insurance regulatory
authority if so required by applicable regulations of the OTS or other
regulatory authority, such access to be afforded without charge but only upon
reasonable request in writing and during normal business hours at the offices
of
the Master Servicer designated by it. In fulfilling such a request the Master
Servicer shall not be responsible for determining the sufficiency of such
information.
All
Mortgage Files and funds collected or held by, or under the control of, the
Master Servicer, in respect of any Mortgage Loans, whether from the collection
of principal and interest payments or from Liquidation Proceeds or Insurance
Proceeds, shall be held by the Master Servicer for and on behalf of the Trustee
and the Certificateholders and shall be and remain the sole and exclusive
property of the Trustee; provided, however, that the Master Servicer and the
Servicer shall be entitled to setoff against, and deduct from, any such funds
any amounts that are properly due and payable to the Master Servicer or the
related Servicer under this Agreement or the Servicing Agreement, as
applicable.
Section
4.07 Standard
Hazard Insurance and Flood Insurance Policies.
For
each
Mortgage Loan, the Master Servicer shall enforce any obligation of the related
Servicer under this Agreement or the Servicing Agreement, as applicable to
maintain or cause to be maintained standard fire and casualty insurance and,
where applicable, flood insurance, all in accordance with the provisions of
this
Agreement or the Servicing Agreement, as applicable. It is understood and agreed
that such insurance shall be with insurers meeting the eligibility requirements
set forth in this Agreement or the Servicing Agreement, as applicable and that
no earthquake or other additional insurance is to be required of any Mortgagor
or to be maintained on property acquired in respect of a defaulted Mortgage
Loan, other than pursuant to such applicable laws and regulations as shall
at
any time be in force and as shall require such additional
insurance.
Pursuant
to Section 3.31, any amounts collected by the Master Servicer, under any
insurance policies (other than amounts to be applied to the restoration or
repair of the property subject to the related Mortgage or released to the
Mortgagor in accordance with this Agreement or the Servicing Agreement, as
applicable) shall be deposited into the Distribution Account, subject to
withdrawal pursuant to Section 3.32.
Section
4.08 Presentment
of Claims and Collection of Proceeds.
The
Master Servicer shall enforce each Servicer’s obligations to prepare and present
on behalf of the Trustee and the Certificateholders all claims under any
insurance policies and take such actions (including the negotiation, settlement,
compromise or enforcement of the insured’s claim) as shall be necessary to
realize recovery under such policies. Any proceeds disbursed to the Master
Servicer (or disbursed to the related Servicer and remitted to the Master
Servicer) in respect of such policies, bonds or contracts shall be promptly
deposited in the Distribution Account upon receipt, except that any amounts
realized that are to be applied to the repair or restoration of the related
Mortgaged Property as a condition precedent to the presentation of claims on
the
related Mortgage Loan to the insurer under any applicable insurance policy
need
not be so deposited (or remitted).
Section
4.09 Maintenance
of the Primary Mortgage Insurance Policies.
The
Master Servicer shall not take, or (to the extent within its control) permit
a
Servicer (to the extent such action is prohibited under this Agreement or the
Servicing Agreement, as applicable) to take, any action that would result in
noncoverage under any primary mortgage insurance policy or any loss which,
but
for the actions of such Master Servicer or the related Servicer, would have
been
covered thereunder. The Master Servicer shall use its best reasonable efforts
to
cause the related Servicer to keep in force and effect (to the extent that
the
Mortgage Loan requires the Mortgagor to maintain such insurance), primary
mortgage insurance applicable to each Mortgage Loan in accordance with the
provisions of this Agreement or the Servicing Agreement, as applicable. The
Master Servicer shall not, and (to the extent within its control) shall not
permit the related Servicer to, cancel or refuse to renew any primary mortgage
insurance policy that is in effect at the date of the initial issuance of the
Mortgage Note and is required to be kept in force hereunder except in accordance
with the provisions of this Agreement or the Servicing Agreement, as
applicable.
The
Master Servicer agrees to cause the related Servicer to present, on behalf
of
the Trustee and the Certificateholders, claims to the insurer under any primary
mortgage insurance policies and, in this regard, to take such reasonable action
as shall be necessary to permit recovery under any primary mortgage insurance
policies respecting defaulted Mortgage Loans. Pursuant to Section 3.31 of this
Agreement or pursuant to the Servicing Agreement, as applicable, any amounts
collected by the related Master Servicer or the Servicer under any primary
mortgage insurance policies shall be deposited by the Servicer or by the Master
Servicer in the Distribution Account, subject to withdrawal pursuant to
Section 3.32.
Section
4.10 Trustee
to Retain Possession of Certain Insurance Policies and
Documents.
The
Trustee or the Custodian, shall retain possession and custody of the originals
(to the extent available) of any primary mortgage insurance policies, or
certificate of insurance if applicable, and any certificates of renewal as
to
the foregoing as may be issued from time to time as contemplated by this
Agreement. Until all amounts distributable in respect of the Certificates have
been distributed in full and the Master Servicer and the related Servicer
otherwise have fulfilled its obligations under this Agreement or the Servicing
Agreement, as applicable, the Trustee or the Custodian shall also retain
possession and custody of each Mortgage File in accordance with and subject
to
the terms and conditions of this Agreement and the Custodial Agreement. The
Master Servicer shall promptly deliver or cause to be delivered to the Trustee
or the Custodian, upon the execution or receipt thereof the originals of any
primary mortgage insurance policies, any certificates of renewal, and such
other
documents or instruments that constitute Mortgage Loan Documents that come
into
the possession of the Master Servicer from time to time.
Section
4.11 Realization
Upon Defaulted Loans.
The
Master Servicer shall cause each Servicer to foreclose upon, repossess or
otherwise comparably convert the ownership of Mortgaged 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,
all
in accordance with this Agreement or the Servicing Agreement, as
applicable.
Section
4.12 Compensation
for the Master Servicer.
As
compensation for its services hereunder, the Master Servicer shall be entitled
to receive all income and gain realized from any investment of funds in the
Distribution Account (the “Master Servicing Compensation”). The Master Servicer
shall be required to pay all expenses incurred by it in connection with its
activities hereunder and shall not be entitled to reimbursement therefor except
as provided in this Agreement.
The
amount of the Master Servicing Compensation payable to the Master Servicer
in
respect of any Distribution Date shall be reduced in accordance with
Section 4.14.
Section
4.13 REO
Property.
In
the
event the Trust Fund acquires ownership of any REO Property in respect of any
Mortgage Loan, the deed or certificate of sale shall be issued to the Trustee,
or to its nominee, on behalf of the Certificateholders. The Master Servicer
shall cause the related Servicer to sell, and the related Servicer agrees to
sell, any REO Property as expeditiously as possible and in accordance with
the
provisions of this Agreement or the Servicing Agreement, as applicable. Further,
the Master Servicer shall cause each Servicer to sell any REO Property prior
to
three years after the end of the calendar year of its acquisition by REMIC
I,
unless (i) the Trustee and the Securities Administrator shall have been supplied
with an Opinion of Counsel to the effect that the holding by the Trust Fund
of
such REO Property subsequent to such three-year period will not result in the
imposition of taxes on “prohibited transactions” of any REMIC hereunder as
defined in Section 860F of the Code or cause any REMIC hereunder to fail to
qualify as a REMIC at any time that any Certificates are outstanding, in which
case the Trust Fund may continue to hold such Mortgaged Property (subject to
any
conditions contained in such Opinion of Counsel) or (ii) the related Servicer
shall have applied for, prior to the expiration of such three-year period,
an
extension of such three-year period in the manner contemplated by
Section 856(e)(3) of the Code, in which case the three-year period shall be
extended by the applicable extension period. The Master Servicer shall cause
each Servicer to protect and conserve, such REO Property in the manner and
to
the extent required by this Agreement, in accordance with the REMIC Provisions
and in a manner that does not result in a tax on “net income from foreclosure
property” or cause such REO Property to fail to qualify as “foreclosure
property” within the meaning of Section 860G(a)(8) of the
Code.
The
Master Servicer shall cause each Servicer to deposit all funds collected and
received in connection with the operation of any REO Property in the related
Custodial Account.
The
Master Servicer and the related Servicer upon the final disposition of any
REO
Property, shall be entitled to reimbursement for any related unreimbursed
Advances and other unreimbursed advances as well as any unpaid Servicing Fees
from Liquidation Proceeds received in connection with the final disposition
of
such REO Property; provided, that any such unreimbursed Advances may be
reimbursed or paid, as the case may be, prior to final disposition, out of
any
net rental income or other net amounts derived from such REO
Property.
Section
4.14 Obligation
of the Master Servicer in Respect of Prepayment Interest
Shortfalls.
The
Master Servicer shall deposit in the Distribution Account not later than each
Distribution Date an amount equal to the lesser of (i) the aggregate amounts
required to be paid by the related Servicer under this Agreement or the
Servicing Agreement, as applicable with respect to Prepayment Interest
Shortfalls on the Mortgage Loans serviced by such Servicer for the related
Distribution Date, and not so paid by such Servicer and (ii) the Master
Servicing Compensation for such Distribution Date without reimbursement
therefor.
ARTICLE
V
ADVANCES
AND DISTRIBUTIONS
Section
5.01 Advances;
Advance Facility.
(a) Each
Servicer shall make an Advance with respect to any Mortgage Loan serviced by
such Servicer and deposit such Advance in the Distribution Account no later
than
noon Eastern time on the Remittance Date in immediately available funds. A
Servicer shall be obligated to make any such Advance only to the extent that
such advance would not be a Nonrecoverable Advance. If a Servicer shall have
determined that it has made a Nonrecoverable Advance or that a proposed Advance
or a lesser portion of such Advance would constitute a Nonrecoverable Advance,
such Servicer shall deliver (i) to the Securities Administrator for the benefit
of the Certificateholders funds constituting the remaining portion of such
Advance, if applicable, and (ii) to the Depositor, each Rating Agency and the
Master Servicer an Officer’s Certificate setting forth the basis for such
determination.
In
lieu
of making all or a portion of such Advance from its own funds, a Servicer may
(i) cause to be made an appropriate entry in its records relating to the related
Custodial Account that any Amounts Held for Future Distribution has been used
by
the Servicer in discharge of its obligation to make any such Advance and (ii)
transfer such funds from the related Custodial Account to the Distribution
Account. Any funds so applied and transferred shall be replaced by the related
Servicer by deposit in the Distribution Account, no later than the close of
business on any future Remittance Date on which the funds on deposit in the
related Custodial Account shall be less than the amount required to be remitted
to the Securities Administrator on such Remittance Date; provided, however
that
if the rating of the related Servicer (including any Successor Servicer) is
less
than “BBB”, the related Servicer shall be required to replace such funds by
deposit to the Distribution Account, no later than the close of business on
the
Remittance Date immediately following the Due Period or Prepayment Period for
which such amounts relate.
Each
Servicer shall be entitled to be reimbursed from the related Custodial Account
for all Advances of its own funds made pursuant to this Section as provided
in Section 3.27 or pursuant to the Servicing Agreement, as applicable. The
obligation to make Advances with respect to any Mortgage Loan shall continue
until such Mortgage Loan is paid in full or the related Mortgaged Property
or
related REO Property has been liquidated or until the purchase or repurchase
thereof (or substitution therefor) from the Trust Fund pursuant to any
applicable provision of this Agreement, except as otherwise provided in this
Section 5.01.
Subject
to and in accordance with the provisions of Article VIII hereof, in the event
that a Servicer fails to make such Advance, then the Master Servicer, as
successor to such Servicer shall be obligated to make such Advance only to
the
extent such Advance, if made, would not constitute a Nonrecoverable Advance,
subject to the provisions of Sections 5.01 and 8.02.
(b) (i)
The
related Servicer is hereby authorized to enter into a financing or other
facility (any such arrangement, an “Advance Facility”), the documentation for
which complies with Section 5.01(b)(v) below, under which (1) such Servicer
assigns or pledges its rights under this Agreement to be reimbursed for any
or
all Advances and/or Servicing Advances to (i) a Person, which may be a
special-purpose bankruptcy-remote entity (an “SPV”), (ii) a Person, which may
simultaneously assign or pledge such rights to an SPV or (iii) a lender (a
“Lender”), which, in the case of any Person or SPV of the type described in
either of the preceding clauses (i) or (ii), may directly or through other
assignees and/or pledgees, assign or pledge such rights to a Person, which
may
include a trustee acting on behalf of holders of debt instruments (any such
Person or any such Lender, an “Advance Financing Person”), and/or (2) an Advance
Financing Person agrees to fund all the Advances and/or Servicing Advances
required to be made by the Servicer pursuant to this Agreement. No consent
of
the Trustee, the Securities Administrator, the Master Servicer, the
Certificateholders or any other party shall be required before the Servicer
may
enter into an Advance Facility nor shall the Trustee, the Securities
Administrator, the Master Servicer or the Certificateholders be a third party
beneficiary of any obligation of an Advance Financing Person to such Servicer.
Notwithstanding the existence of any Advance Facility under which an Advance
Financing Person agrees to fund Advances and/or Servicing Advances, (A) such
Servicer (i) shall remain obligated pursuant to this Agreement to make Advances
and/or Servicing Advances pursuant to and as required by this Agreement and
(ii)
shall not be relieved of such obligations by virtue of such Advance Facility
and
(B) neither the Advance Financing Person nor any Servicer Assignee (as
hereinafter defined) shall have any right to proceed against or otherwise
contact any Mortgagor for the purpose of collecting any payment that may be
due
with respect to any related Mortgage Loan or enforcing any covenant of such
Mortgagor under the related Mortgage Loan documents.
(ii) If
the
related Servicer enters into an Advance Facility, such Servicer and the related
Advance Financing Person shall deliver to the Master Servicer and the Securities
Administrator at the address set forth in Section 11.05 hereof no later
than the Remittance Date immediately following the effective date of such
Advance Facility a written notice (an “Advance Facility Notice”), stating (a)
the identity of the Advance Financing Person and (b) the identity of the Person
(the “Servicer’s Assignee”) that will, subject to Section 5.01(b)(iii)
hereof, have the right to make withdrawals from the Custodial Account pursuant
to Section 3.27 hereof to reimburse previously unreimbursed Advances and/or
Servicing Advances (“Advance Reimbursement Amounts”). Advance Reimbursement
Amounts (i) shall consist solely of amounts in respect of Advances and/or
Servicing Advances for which the related Servicer would be permitted to
reimburse itself in accordance with Section 3.27 hereof, assuming the
related Servicer had made the related Advance(s) and/or Servicing Advance(s)
and
(ii) shall not consist of amounts payable to a successor Servicer in accordance
with Section 3.27 hereof to the extent permitted under
Section 5.01(b)(v) below.
(iii) Notwithstanding
the existence of an Advance Facility, the related Servicer, on behalf of the
Advance Financing Person and the Servicer’s Assignee, shall be entitled to
receive reimbursements of Advances and/or Servicing Advances in accordance
with
Section 3.27 hereof, which entitlement may be terminated by the Advance
Financing Person pursuant to a written notice to the Master Servicer and the
Securities Administrator in the manner set forth in Section 11.05 hereof.
Upon receipt of such written notice, the related Servicer shall no longer be
entitled to receive reimbursement for any Advance Reimbursement Amounts and
the
Servicer’s Assignee shall immediately have the right to receive from the related
Custodial Account all Advance Reimbursement Amounts. Notwithstanding the
foregoing, and for the avoidance of doubt, (i) the related Servicer and/or
the
Servicer’s Assignee shall only be entitled to reimbursement of Advance
Reimbursement Amounts hereunder from withdrawals from the related Custodial
Account pursuant to Section 3.27 of this Agreement and shall not otherwise
be entitled to make withdrawals or receive amounts that shall be deposited
in
the Distribution Account pursuant to Section 3.31 hereof, and (ii) none of
the Trustee or the Certificateholders shall have any right to, or otherwise
be
entitled to, receive any Advance Reimbursement Amounts to which the related
Servicer or the Servicer’s Assignee, as applicable, shall be entitled pursuant
to Section 3.27 hereof. An Advance Facility may be terminated by the joint
written direction of the related Servicer and the related Advance Financing
Person. Written notice of such termination shall be delivered to the Trustee
in
the manner set forth in Section 11.05 hereof. None of the Depositor, Master
Servicer, the Securities Administrator or the Trustee shall, as a result of
the
existence of any Advance Facility, have any additional duty or liability with
respect to the calculation or payment of any Advance Reimbursement Amount,
nor,
as a result of the existence of any Advance Facility, shall the Depositor,
Master Servicer, the Securities Administrator or the Trustee have any additional
responsibility to track or monitor the administration of the Advance Facility
or
the payment of Advance Reimbursement Amounts to the Servicer’s Assignee. The
related Servicer shall indemnify the Master Servicer, the Securities
Administrator, Depositor, the Trustee, any successor Servicer and the Trust
Fund
for any claim, loss, liability or damage resulting from any claim by the related
Advancing Financing Person, except to the extent that such claim, loss,
liability or damage resulted from or arose out of gross negligence, recklessness
or willful misconduct on the part of the Master Servicer, the Securities
Administrator, Depositor, the Trustee or any successor Servicer, as the case
may
be. The related Servicer shall maintain and provide to any successor Servicer
and, upon request, the Trustee a detailed accounting on a loan-by-loan basis
as
to amounts advanced by, pledged or assigned to, and reimbursed to any Advancing
Financing Person. The successor Servicer shall be entitled to rely on any such
information provided by the related Servicer, and the successor Servicer shall
not be liable for any errors in such information.
(iv) An
Advance Financing Person who receives an assignment or pledge of rights to
receive Advance Reimbursement Amounts and/or whose obligations are limited
to
the funding of Advances and/or Servicing Advances pursuant to an Advance
Facility shall not be required to meet the criteria for qualification as a
Servicer under this Agreement.
(v) As
between the related Servicer and its Advance Financing Person, on the one hand,
and a successor Servicer and its Advance Financing Person, if any, on the other
hand, Advance Reimbursement Amounts on a loan-by-loan basis with respect to
each
Mortgage Loan as to which an Advance and/or Servicing Advance shall have been
made and be outstanding shall be allocated on a “first-in, first out” basis. In
the event the Servicer’s Assignee shall have received some or all of an Advance
Reimbursement Amount related to Advances and/or Servicing Advances that were
made by a Person other than the related Servicer or its related Advance
Financing Person in error, then the Servicer’s Assignee shall be required to
remit any portion of such Advance Reimbursement Amount to each Person entitled
to such portion of such Advance Reimbursement Amount. Without limiting the
generality of the foregoing, the related Servicer shall remain entitled to
be
reimbursed by the Advance Financing Person for all Advances and/or Servicing
Advances funded by the related Servicer to the extent the related Advance
Reimbursement Amounts have not been assigned or pledged to such Advance
Financing Person or the Servicer’s Assignee.
(vi) For
purposes of any Officer’s Certificate of the related Servicer delivered pursuant
to Section 5.01(a), any Nonrecoverable Advance referred to therein may have
been made by the related Servicer. In making its determination that any Advance
or Servicing Advance theretofore made has become a Nonrecoverable Advance,
the
related Servicer shall apply the same criteria in making such determination
regardless of whether such Advance or Servicing Advance shall have been made
by
the related Servicer.
(vii) Any
amendment to this Section 5.01(b) or to any other provision of this
Agreement that may be necessary or appropriate to effect the terms of an Advance
Facility as described generally in this Section 5.01(b), including
amendments to add provisions relating to a successor Servicer, may be entered
into by the Master Servicer, the Securities Administrator, the Trustee, the
Depositor and the related Servicer without the consent of any Certificateholder,
provided such amendment complies with Section 11.01 hereof. All reasonable
costs and expenses (including attorneys’ fees) of each party hereto of any such
amendment shall be borne solely by the related Servicer. The parties hereto
hereby acknowledge and agree that: (a) the Advances and/or Servicing Advances
financed by and/or pledged to an Advance Financing Person under any Advance
Facility are obligations owed to the related Servicer payable only from the
cash
flows and proceeds received under this Agreement for reimbursement of Advances
and/or Servicing Advances only to the extent provided herein, and none of the
Master Servicer, the Securities Administrator, the Trustee or the Trust Fund
are, as a result of the existence of any Advance Facility, obligated or liable
to repay any Advances and/or Servicing Advances financed by the Advance
Financing Person; (b) the Servicer will be responsible for remitting to the
Advance Financing Person the applicable amounts collected by it as reimbursement
for Advances and/or Servicing Advances funded by the Advance Financing Person,
subject to the provisions of this Agreement; and (c) none of the Master
Servicer, the Securities Administrator or the Trustee shall have any
responsibility to track or monitor the administration of the financing
arrangement between the related Servicer and any Advance Financing
Person.
Section
5.02 Compensating
Interest Payments.
In
the
event that there is a Prepayment Interest Shortfall arising from a voluntary
Principal Prepayment in part or in full by the Mortgagor with respect to any
Mortgage Loan, the related Servicer shall, to the extent of one-half of the
Servicing Fee with respect to such Servicer for such Distribution Date, deposit
into the related Custodial Account, as a reduction of and to the extent of,
one-half of the Servicing Fee with respect to such Servicer for such
Distribution Date, no later than the close of business on the Remittance Date
immediately preceding such Distribution Date, an amount equal to the Prepayment
Interest Shortfall; and in case of such deposit, the related Servicer shall
not
be entitled to any recovery or reimbursement from the Depositor, the Trustee,
the Sponsor, the Trust Fund, the Master Servicer or the
Certificateholders.
Section
5.03 REMIC
Distributions.
On
each
Distribution Date the Securities Administrator, shall be deemed to allocate
distributions to the REMIC Regular Interests in accordance with
Section 5.11 hereof.
Section
5.04 Reserved.
Section
5.05 Reserved.
Section
5.06 Distributions
on the Certificates.
(a)
On
each Distribution Date, the Securities Administrator will withdraw funds on
deposit in the Distribution Account and make distributions to the
Certificateholders in the following order of priority:
(i) On
each
Distribution Date, the Interest Remittance Amount for such Distribution Date
will be paid in the following order of priority:
(A) to
the
Supplemental Interest Trust, any Net Swap Payment and any Swap Termination
Payment owed to the Swap Provider (unless the Swap Provider is the sole
Defaulting Party or the sole Affected Party (as defined in the ISDA Master
Agreement) and to the extent not paid by the Securities Administrator from
any
upfront payment received pursuant to any replacement interest rate swap
agreement that may be entered into by the Supplemental Interest Trust
Trustee);
(B) concurrently,
to the Senior Certificates, pro rata based on the entitlement of each such
Class, Current Interest and any Carryforward Interest for each such Class and
such Distribution Date;
(C) to
the
Class M-1 Certificates, Current Interest and any Carryforward Interest for
such
Class and Distribution Date;
(D) to
the
Class M-2 Certificates, Current Interest and any Carryforward Interest for
such
Class and Distribution Date;
(E) to
the
Class M-3 Certificates, Current Interest and any Carryforward Interest for
such
Class and Distribution Date;
(F) to
the
Class M-4 Certificates, Current Interest and any Carryforward Interest for
such
Class and Distribution Date;
(G) to
the
Class M-5 Certificates, Current Interest and any Carryforward Interest for
such
Class and Distribution Date;
(H) for
application as part of Monthly Excess Cashflow for such Distribution Date,
any
Interest Remittance Amount remaining after application pursuant to clauses
(A)
through (G) above (such amount, “Monthly Excess Interest”) for such Distribution
Date.
(ii) The
Principal Payment Amount will be paid on each Distribution Date as
follows:
A. On
each
Distribution Date (x) prior to the Stepdown Date or (y) with respect to which
a
Trigger Event is in effect, the Principal Payment Amount will be paid in the
following order of priority:
(i)
|
to
the Supplemental Interest Trust, any Net Swap Payment and any Swap
Termination Payment owed to the Swap Provider (unless the Swap Provider
is
the sole Defaulting Party or the sole Affected Party (as defined
in the
ISDA Master Agreement and to the extent not paid by the Securities
Administrator from any upfront payment received pursuant to any
replacement interest rate swap agreement that may be entered into
by the
Supplemental Interest Trust Trustee)) to the extent not paid from
the
Interest Remittance Amount on such Distribution Date;
|
(ii)
|
concurrently,
to the Senior Certificates as follows:
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(1)
to the Class A-1A Certificates and Class A-1B Certificates, the Class
A-1
Allocation Percentage of the Principal Payment Amount remaining after
distribution to the Supplemental Interest Trust pursuant to clause
(i)
above, on a pro rata basis, based on their respective Certificate
Principal Balances, until the Certificate Principal Balance of each
such
Class has been reduced to zero; and
|
|
(2)
the Senior Sequential Allocation Percentage of the Principal Payment
Amount remaining after distributions to the Supplemental Interest
Trust
pursuant to clause (i) above, in the following order of
priority:
|
|
(a)
to the Class A-2 Certificates, until its Certificate Principal Balance
has
been reduced to zero;
|
|
(b)
concurrently, to the Class A-3A Certificates and the Class A-3B
Certificates, on a pro rata basis, based on their respective Certificate
Principal Balances, until the Certificate Principal Balance of each
such
Class has been reduced to zero; and
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(c)
concurrently, to the Class A-4A Certificates and the Class A-4B
Certificates, on a pro rata basis, based on their respective Certificate
Principal Balances, until the Certificate Principal Balance of each
such
Class has been reduced to zero; provided, however that, if a Sequential
Trigger Event is in effect for such Distribution Date, principal
distributions to the Class A-4A Certificates and Class A-4B Certificates
pursuant to this clause (c) will be allocated first to the Class
A-4A
Certificates, until its Certificate Principal Balance has been reduced
to
zero and then to the Class A-4B Certificates, until its Certificate
Principal Balance has been reduced to zero;
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(iii)
|
to
the Class M-1 Certificates, until its Certificate Principal Balance
is
reduced to zero;
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(iv)
|
to
the Class M-2 Certificates, until its Certificate Principal Balance
is
reduced to zero;
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(v)
|
to
the Class M-3 Certificates, until its Certificate Principal Balance
is
reduced to zero;
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(vi)
|
to
the Class M-4 Certificates, until its Certificate Principal Balance
is
reduced to zero;
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(vii)
|
to
the Class M-5 Certificates, until its Certificate Principal Balance
is
reduced to zero;
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(viii)
|
for
application as part of Monthly Excess Cashflow for such Distribution
Date
pursuant to subclause (iii) below, any such Principal Payment Amount
remaining after application pursuant to clauses A(i) through (vii)
above.
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B. On
each
Distribution Date (x) on or after the Stepdown Date and (y) with respect to
which a Trigger Event is not in effect, the Principal Payment Amount will be
paid in the following order of priority:
(i)
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(ii)
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concurrently,
to the Senior Certificates, the Senior Principal Payment Amount,
as
follows:
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(1)
to the Class A-1A Certificates and Class A-1B Certificates, the Class
A-1
Allocation Percentage of the Senior Principal Payment Amount, on
a pro
rata basis, based on their respective Certificate Principal Balances,
until the Certificate Principal Balance of each such Class has been
reduced to zero; and
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(2)
the Senior Sequential Allocation Percentage of the Senior Principal
Payment Amount, in the following order of priority:
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(a)
to the Class A-2 Certificates, until its Certificate Principal Balance
has
been reduced to zero;
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(b)
concurrently, to the Class A-3A Certificates and the Class A-3B
Certificates, on a pro rata basis, based on their respective Certificate
Principal Balances, until the Certificate Principal Balance of each
such
Class has been reduced to zero; and
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(c)
concurrently, to the Class A-4A Certificates and the Class A-4B
Certificates, on a pro rata basis, based on their respective Certificate
Principal Balances, until the Certificate Principal Balance of each
such
Class has been reduced to zero;
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(iii)
|
to
the Class M-1 Certificates, the Class M-1 Principal Payment Amount
for
such Distribution Date, until its Certificate Principal Balance is
reduced
to zero;
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(iv)
|
to
the Class M-2 Certificates, the Class M-2 Principal Payment Amount
for
such Distribution Date, until its Certificate Principal Balance is
reduced
to zero;
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(v)
|
to
the Class M-3 Certificates, the Class M-3 Principal Payment Amount
for
such Distribution Date, until its Certificate Principal Balance is
reduced
to zero;
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(vi)
|
to
the Class M-4 Certificates, the Class M-4 Principal Payment Amount
for
such Distribution Date, until its Certificate Principal Balance is
reduced
to zero;
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(vii)
|
to
the Class M-5 Certificates, the Class M-5 Principal Payment Amount
for
such Distribution Date, until its Certificate Principal Balance is
reduced
to zero;
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(viii)
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for
application as part of Monthly Excess Cashflow for such Distribution
Date
pursuant to clause (iii) below, any such Principal Payment Amount
remaining after application pursuant to clauses B(i) through (vii)
above.
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Notwithstanding
the priority of distributions described above with respect to the Senior
Certificates, on any Distribution Date which occurs after the Certificate
Principal Balances of the Mezzanine Certificates have been reduced to zero
distributions in respect of principal to the Senior Certificates will be made
on
a pro rata basis, based on the Certificate Principal Balance of each such Class,
until the Certificate Principal Balance of each such Class has been reduced
to
zero; provided, however that, if a Sequential Trigger Event is in effect for
such Distribution Date, principal distributions to the Class A-4A Certificates
and Class A-4B Certificates pursuant to this paragraph will be allocated first
to the Class A-4A Certificates, until its Certificate Principal Balance has
been
reduced to zero and then to the Class A-4B Certificates, until its Certificate
Principal Balance has been reduced to zero.
(iii) On
each
Distribution Date, the Monthly Excess Cashflow will be distributed in the
following order of priority:
(A)(i) until
the
aggregate Certificate Principal Balance of the Senior Certificates and Mezzanine
Certificates equals the Aggregate Loan Balance for such Distribution Date minus
the Targeted Overcollateralization Amount for such Distribution Date, on each
Distribution Date (x) prior to the Stepdown Date or (y) with respect to which
a
Trigger Event is in effect, to the extent of Monthly Excess Interest for such
Distribution Date, to the Senior Certificates and Mezzanine Certificates, in
the
following order of priority:
(1)
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Concurrently,
to the Senior Certificates as follows:
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(a)
to the Class A-1A Certificates and Class A-1B Certificates, the Class
A-1
Allocation Percentage of the Monthly Excess Cashflow, on a pro rata
basis,
based on their respective Certificate Principal Balances, until the
Certificate Principal Balance of each such Class has been reduced
to zero;
and
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(b)
the Senior Sequential Allocation Percentage of the Monthly Excess
Cashflow, in the following order of priority:
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(I)
to the Class A-2 Certificates, until its Certificate Principal Balance
has
been reduced to zero;
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(II)
concurrently, to the Class A-3A Certificates and the Class A-3B
Certificates, on a pro rata basis, based on their respective Certificate
Principal Balances, until the Certificate Principal Balance of each
such
Class has been reduced to zero; and
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(III)
concurrently, to the Class A-4A Certificates and the Class A-4B
Certificates, on a pro rata basis, based on their respective Certificate
Principal Balances, until the Certificate Principal Balance of each
such
Class has been reduced to zero; provided, however that, if a Sequential
Trigger Event is in effect for such Distribution Date, principal
distributions to the Class A-4A Certificates and Class A-4B Certificates
pursuant to this clause (III) will be allocated first to the Class
A-4A
Certificates, until its Certificate Principal Balance has been reduced
to
zero and then to the Class A-4B Certificates, until its Certificate
Principal Balance has been reduced to zero;
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(2)
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To
the Class M-1 Certificates, until its Certificate Principal Balance
is
reduced to zero;
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(3)
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To
the Class M-2 Certificates, until its Certificate Principal Balance
is
reduced to zero;
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(4)
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To
the Class M-3 Certificates, until its Certificate Principal Balance
is
reduced to zero;
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(5)
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To
the Class M-4 Certificates, until its Certificate Principal Balance
is
reduced to zero; and
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(6)
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To
the Class M-5 Certificates, until its Certificate Principal Balance
is
reduced to zero;
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(ii) on
each
Distribution Date on or after the Stepdown Date and with respect to which a
Trigger Event is not in effect, to fund any principal distributions required
to
be made on such Distribution Date set forth in Section 5.06(ii)B after
giving effect to the distribution of the Principal Payment Amount for such
date,
in accordance with the priorities set forth therein;
(B) to
the
Senior Certificates, any Deferred Amount for each such Class, on a pro rata
basis, based on the amount due with respect to each such Class;
(C) to
the
Class M-1 Certificates, any Deferred Amount for such Class;
(D) to
the
Class M-2 Certificates, any Deferred Amount for such Class;
(E) to
the
Class M-3 Certificates, any Deferred Amount for such Class;
(F) to
the
Class M-4 Certificates, any Deferred Amount for such Class;
(G) to
the
Class M-5 Certificates, any Deferred Amount for such Class;
(H) to
the
Basis Risk Shortfall Reserve Fund and then from the Basis Risk Shortfall Reserve
Fund to the Senior Certificates, concurrently, any Basis Risk Shortfall for
each
such Class, on a pro rata basis based on the entitlement of each such
Class;
(I) to
the
Basis Risk Shortfall Reserve Fund and then from the Basis Risk Shortfall Reserve
Fund to the Class M-1 Certificates, any Basis Risk Shortfall for such Class;
(J) to
the
Basis Risk Shortfall Reserve Fund and then from the Basis Risk Shortfall Reserve
Fund to the Class M-2 Certificates, any Basis Risk Shortfall for such Class;
(K) to
the
Basis Risk Shortfall Reserve Fund and then from the Basis Risk Shortfall Reserve
Fund to the Class M-3 Certificates, any Basis Risk Shortfall for such Class;
(L) to
the
Basis Risk Shortfall Reserve Fund and then from the Basis Risk Shortfall Reserve
Fund to the Class M-4 Certificates, any Basis Risk Shortfall for such
Class;
(M) to
the
Basis Risk Shortfall Reserve Fund and then from the Basis Risk Shortfall Reserve
Fund to the Class M-5 Certificates, any Basis Risk Shortfall for such
Class;
(N) to
the
Supplemental Interest Trust, any Swap Termination Payment owed to the Swap
Provider in the event of a Swap Provider Trigger Event not paid on prior
Distribution Dates and to the extent not paid by the Securities Administrator
from any upfront payment received pursuant to any replacement interest rate
swap
agreement that may be entered into by the Supplemental Interest Trust
Trustee;
(O) to
the
Class X Certificates, the Class X Distribution Amount; and
(P) to
the
Class R Certificates (in respect of the Class R-3 Interest), any remaining
amount. It is not anticipated that any amounts will be distributed to the Class
R Certificates under this clause (P).
Notwithstanding
the foregoing, distributions pursuant to clauses (B) through (M) above on any
Distribution Date will be made after giving effect to payments received pursuant
to the Swap Agreement. On each Distribution Date, the Securities Administrator,
after making the required distributions of interest and principal to the
Certificates as described in clauses (i) and (ii) above and after the
distribution of the Monthly Excess Cashflow as described in clause (iii) above,
will withdraw from the Basis Risk Shortfall Reserve Fund the amounts on deposit
therein and distribute such amounts to the Senior Certificates and Mezzanine
Certificates in respect of any Basis Risk Shortfalls in the following manner
and
order of priority: first, concurrently to the Senior Certificates, on a pro
rata
basis, based on the entitlement of each such Class, the amount of any Basis
Risk
Shortfalls allocated to such Class for such Distribution Date; second, to the
Class M-1 Certificates, the amount of any Basis Risk Shortfall allocated to
such
Class for such Distribution Date for such Class; third, to the Class M-2
Certificates, the amount of any Basis Risk Shortfall allocated to such Class
for
such Distribution Date for such Class; fourth, to the Class M-3 Certificates,
the amount of any Basis Risk Shortfalls allocated to such Class for such
Distribution Date for such Class; fifth, to the Class M-4 Certificates, the
amount of any Basis Risk Shortfalls allocated to such Class for such
Distribution Date; and sixth, to the Class M-5 Certificates, the amount of
any
Basis Risk Shortfalls allocated to such Class for such Distribution
Date.
(b) Subject
to Section 10.02 hereof respecting the final distribution on a Class of
Senior Certificates or Mezzanine Certificates, on each Distribution Date the
Securities Administrator shall make distributions to each Holder of a Senior
Certificate or Mezzanine Certificate of record on the preceding Record Date
either by wire transfer in immediately available funds to the account of such
holder at a bank or other entity having appropriate facilities therefor, if
(i)
such Holder has so notified the Securities Administrator at least five (5)
Business Days prior to the related Record Date and (ii) such Holder shall hold
Regular Certificates with aggregate principal denominations of not less than
$1,000,000 or evidencing a Percentage Interest aggregating ten percent (10%)
or
more with respect to such Class or, if not, by check mailed by first class
mail
to such Certificateholder at the address of such holder appearing in the
Certificate Register. Notwithstanding the foregoing, but subject to
Section 10.02 hereof respecting the final distribution, distributions with
respect to Senior Certificates and Mezzanine Certificates registered in the
name
of a Depository shall be made to such Depository in immediately available
funds.
(c) Net
Swap
Payments and Swap Termination Payments (other than Swap Termination Payments
resulting from a Swap Provider Trigger Event) payable by the Supplemental
Interest Trust to the Swap Provider pursuant to the Swap Agreement shall be
deducted from Interest Remittance Amount, and to the extent of any such
remaining amounts due, from Principal Remittance Amount, prior to any
distributions to the Holders of the Certificates. On each Distribution Date,
such amounts will be remitted to the Supplemental Interest Trust, first to
make
any Net Swap Trust Payment owed to the Swap Provider pursuant to the Swap
Agreement for such Distribution Date, and second to make any Swap Termination
Payment (not due to a Swap Provider Trigger Event) owed to the Swap Provider
pursuant to the Swap Agreement for such Distribution Date. Any Swap Termination
Payment due as a result of the occurrence of a Swap Provider Trigger Event
owed
to the Swap Provider pursuant to the Swap Agreement will be subordinated to
distributions to the Holders of the Senior Certificates and Mezzanine
Certificates and shall be paid as set forth in Section
5.06(a)(iii)(N).
(d) On
each
Distribution Date, the Securities Administrator shall distribute from the
amounts received from the Swap Provider in respect of any Net Swap Trust Payment
then on deposit in the Supplemental Interest Trust in the following order of
priority:
(iv) concurrently
to the Senior Certificates, on a pro rata basis based on the entitlement of
each
such Class, in an amount equal to any Current Interest and any Carryforward
Interest for each such Class to the extent not covered by the Interest
Remittance Amount on that Distribution Date and solely to the extent the amount
of any Current Interest and Carryforward Interest is a result of the allocation
of the interest portion of Realized Losses;
(v) sequentially,
to the Class X-0, Xxxxx X-0, Class M-3, Class M-4 and Class M-5 Certificates,
in
that order, in an amount equal to any Current Interest and any Carryforward
Interest for each such Class to the extent not covered by the Interest
Remittance Amount on that Distribution Date and solely to the extent the amount
of any Current Interest and Carryforward Interest is as a result of the
allocation of the interest portion of Realized Losses;
(vi) to
the
Senior Certificates and Mezzanine Certificates then entitled to distributions
of
principal in the priority provided above, in an amount necessary to maintain
or
restore the Targeted Overcollateralization Amount to the extent not covered
by
the Monthly Excess Cashflow on that Distribution Date;
(vii) first,
concurrently, to the Senior Certificates, on a pro rata basis, based on the
entitlement of each such Class and then, to the Class X-0, Xxxxx X-0, Class
M-3,
Class M-4 and Class M-5 Certificates, in that order, in an amount equal to
any
applicable Deferred Amounts, with interest thereon at the applicable
Pass-Through Rate, prior to taking into account amounts available to pay
Deferred Amounts from Monthly Excess Cashflow on that Distribution
Date
(viii) to
the
Basis Risk Shortfall Reserve Fund, to pay the Senior Certificates and Mezzanine
Certificates as follows: first, to the Senior Certificates, on a pro rata basis
based on the entitlement of each such Class, based on the aggregate amount
of
Basis Risk Shortfall Amounts for each such Class of Senior Certificates for
such
Distribution Date, and second, sequentially, to the Class X-0, Xxxxx X-0, Class
M-3, Class M-4 and Class M-5 Certificates, in that order, any related Basis
Risk
Shortfall Amount for each such Class for such Distribution Date, in each case
prior to giving effect to any withdrawals from the Basis Risk Shortfall Reserve
Fund or Monthly Excess Cashflow on that Distribution Date; and
(ix) to
the
Class X Certificates, any remaining amounts.
Section
5.07 Reserved.
Section
5.08 Reserved.
Section
5.09 Allocation
of Realized Losses on the Mortgage Loans.
(a) On
or
prior to each Determination Date, the Securities Administrator shall determine
the amount of any Realized Loss in respect of each Mortgage Loan that occurred
during the immediately preceding calendar month.
(b) The
interest portion of Realized Losses on the Mortgage Loans shall be allocated
to
the Certificates as described in Section 1.02 hereof.
(c) The
principal portion of all Realized Losses on the Mortgage Loans shall be
allocated on each Distribution Date as follows: first, in reduction of Net
Swap
Payments paid by the Swap Provider under the Swap Agreement and the Monthly
Excess Cashflow for such Distribution Date; second, to the Class X Certificates,
until the Certificate Principal Balance thereof has been reduced to zero; third,
to the Class M-5 Certificates, until the Certificate Principal Balance thereof
has been reduced to zero; fourth, to the Class M-4 certificates, until the
Certificate Principal Balance thereof has been reduced to zero; fifth, to the
Class M-3 Certificates, until the Certificate Principal Balance thereof has
been
reduced to zero; sixth, to the Class M-2 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero; seventh, to the Class M-1
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero; and eighth, to the Senior Certificates, on a pro rata basis, based
on
the Certificate Principal Balance of each such Class, until the Certificate
Principal Balance of each such Class has been reduced to zero; provided, however
that, the pro rata allocation of Realized Losses otherwise allocable to the
Class A-1A Certificates will first be allocated to the Class A-1B Certificates,
until the Certificate Principal Balance thereof has been reduced to zero and
then to the Class A-1A Certificates, until the Certificate Principal Balance
thereof has been reduced to zero; provided, further that, the pro rata
allocation of Realized Losses otherwise allocable to the Class A-3A Certificates
will first be allocated to the Class A-3B Certificates, until the Certificate
Principal Balance thereof has been reduced to zero and then to the Class A-3A
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero; provided, further that, the pro rata allocation of Realized Losses
otherwise allocable to the Class A-4A Certificates will first be allocated
to
the Class A-4B Certificates, until the Certificate Principal Balance thereof
has
been reduced to zero and then to the Class A-4A Certificates, until the
Certificate Principal Balance thereof has been reduced to zero.
All
such
Realized Losses to be allocated to the Certificate Principal Balances of the
Senior Certificates and the Mezzanine Certificates on any Distribution Date
shall be so allocated after the actual distributions to be made on such date
as
provided above. All references above to the Certificate Principal Balance of
any
Class of Senior Certificates or any Class of Mezzanine Certificates shall be
to
the Certificate Principal Balance of such Class immediately prior to the
relevant Distribution Date, before reduction thereof by any Realized Losses,
in
each case to be allocated to such Class of Certificates, on such Distribution
Date.
Any
allocation of the principal portion of Realized Losses to a Class of Senior
Certificates or a Class of Mezzanine Certificates on any Distribution Date
shall
be made by reducing the Certificate Principal Balance thereof by the amount
so
allocated; any allocation of Realized Losses to a Class X Certificate shall
be
made by reducing the amount otherwise payable in respect thereof pursuant to
Section 5.09(c).
All
such
Realized Losses and all other losses allocated to a Class of Certificates
hereunder will be allocated among the Certificates of such Class in proportion
to the Percentage Interests evidenced thereby.
(d) Notwithstanding
anything to the contrary contained herein, if on any Distribution Date the
Securities Administrator discovers, based solely on the reports delivered by
the
related Servicer under this Agreement or the Servicing Agreement, as applicable,
that any Subsequent Recoveries have been collected by such Servicer with respect
to the Mortgage Loans, the amount of such Subsequent Recoveries will be applied
to increase the Certificate Principal Balance of the Class of Certificates
with
the highest payment priority to which Realized Losses on the Mortgage Loans
have
been allocated (or, in the case of the Senior Certificates, on a pro rata basis,
based on the amount of Realized Losses allocated to each such Class), but not
by
more than the amount of Realized Losses previously allocated to such Class
pursuant to this Section 5.09. After the Certificate Principal Balances of
any Class of Certificates has been increased up to the amount of Realized Losses
allocated thereto pursuant to this Section 5.09 to the extent that such
Applied Loss Amounts have not been paid to such Class as a Deferred Amount,
any
additional Subsequent Recoveries with respect to the Mortgage Loans will be
applied to increase the Certificate Principal Balance of the other Classes
of
Certificates, beginning with the Class of Certificates with the next highest
payment priority (or in the case of any Senior Certificates with unpaid Deferred
Amounts (on a pro rata basis, based on the entitlement of each such Class),
up
to the amount of such Realized Losses previously allocated to such Class of
Certificates pursuant to this Section 5.09 but only to the extent that any
such Applied Loss Amount has not been paid to any Class of Certificates as
a
Deferred Amount. Holders of such Certificates will not be entitled to any
payment in respect of current interest on the amount of such increases for
any
Accrual Period preceding the Distribution Date on which such increase occurs.
Any such increases shall be applied to the Certificate Principal Balance of
each
Class of Certificates in accordance with its respective Percentage Interest.
(e) With
respect to the REMIC I Regular Interests, all Realized Losses on the Mortgage
Loans shall be allocated on each Distribution Date first, to REMIC I Regular
Interest I until the Uncertificated Principal Balance has been reduced to zero,
and second, to REMIC I Regular Interest I-1-A through REMIC I Regular Interest
I-60-B, starting with the lowest numerical denomination until such REMIC I
Regular Interest has been reduced to zero, provided that, for REMIC I Regular
Interests with the same numerical denomination, such Realized Losses shall
be
allocated pro rata between such REMIC I Regular Interests.
(f) All
Realized Losses on the Mortgage Loans shall be allocated on each Distribution
Date to the following REMIC II Regular Interests in the specified percentages,
as follows: first, to Uncertificated Accrued Interest payable to the REMIC
II
Regular Interest LT-AA and REMIC II Regular Interest LT-ZZ up to an aggregate
amount equal to the REMIC II Interest Loss Allocation Amount, 98% and 2%,
respectively; second, to the Uncertificated Principal Balances of REMIC II
Regular Interest LT-AA and REMIC II Regular Interest LT-ZZ up to an aggregate
amount equal to the REMIC II Principal Loss Allocation Amount, 98% and 2%,
respectively; third, to the Uncertificated Principal Balances of REMIC II
Regular Interest LT-AA, REMIC II Regular Interest LT-M5 and REMIC II Regular
Interest LT-ZZ, 98%, 1% and 1%, respectively, until the Uncertificated Principal
Balance of REMIC II Regular Interest LT-M5 has been reduced to zero; fourth,
to
the Uncertificated Principal Balances of REMIC II Regular Interest LT-AA, REMIC
II Regular Interest LT-M4 and REMIC II Regular Interest LT-ZZ, 98%, 1% and
1%,
respectively, until the Uncertificated Principal Balance of REMIC II Regular
Interest LT-M4 has been reduced to zero; fifth, to the Uncertificated Principal
Balances of REMIC II Regular Interest LT-AA, REMIC II Regular Interest LT-M3
and
REMIC II Regular Interest LT-ZZ, 98%, 1% and 1%, respectively, until the
Uncertificated Principal Balance of REMIC II Regular Interest LT-M3 has been
reduced to zero; sixth, to the Uncertificated Principal Balances of REMIC II
Regular Interest LT-AA, REMIC II Regular Interest LT-M2 and REMIC II Regular
Interest LT-ZZ, 98%, 1% and 1%, respectively, until the Uncertificated Principal
Balance of REMIC II Regular Interest LT-M2 has been reduced to zero; seventh,
to
the Uncertificated Principal Balances of REMIC II Regular Interest LT-AA, REMIC
II Regular Interest LT-M1 and REMIC II Regular Interest LT-ZZ, 98%, 1% and
1%,
respectively, until the Uncertificated Principal Balance of REMIC II Regular
Interest LT-M1 has been reduced to zero; and eighth, to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-AA, 98%, to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-A1A, REMIC II Regular Interest
LT-A1B, REMIC II Regular Interest LT-A2, REMIC II Regular Interest LT-A3A,
REMIC
II Regular Interest LT-A3B, REMIC II Regular Interest LT-A4A and REMIC II
Regular Interest LT-A4B, 1% on a pro rata basis, based on the Uncertificated
Principal Balance of each such REMIC II Regular Interest and to the
Uncertificated Principal Balance of REMIC II Regular Interest LT-ZZ, 1%, until
the Uncertificated Principal Balances of REMIC II Regular Interest LT-A1A,
REMIC
II Regular Interest LT-A1B, REMIC II Regular Interest LT-A2, REMIC II Regular
Interest LT-A3A, REMIC II Regular Interest LT-A3B, REMIC II Regular Interest
LT-A4A and REMIC II Regular Interest LT-A4B have been reduced to zero, provided,
however that, the pro rata allocation of Realized Losses otherwise allocable
to
REMIC II Regular Xxxxxxxx XX-X0X will first be allocated to REMIC II Regular
Interest LT-A1B, until the Uncertificated Principal Balance thereof has been
reduced to zero and then to REMIC II Regular Interest LT-A1A, until the
Uncertificated Principal Balance thereof has been reduced to zero; provided,
further that, the pro rata allocation of Realized Losses otherwise allocable
to
REMIC II Regular Xxxxxxxx XX-X0X will first be allocated to REMIC II Regular
Interest LT-A3B, until the Uncertificated Principal Balance thereof has been
reduced to zero and then to REMIC II Regular Interest LT-A3A, until the
Uncertificated Principal Balance thereof has been reduced to zero; provided,
further that, the pro rata allocation of Realized Losses otherwise allocable
to
REMIC II Regular Xxxxxxxx XX-X0X will first be allocated to REMIC II Regular
Interest LT-A4B, until the Uncertificated Principal Balance thereof has been
reduced to zero and then to REMIC II Regular Interest LT-A4B, until the
Uncertificated Principal Balance thereof has been reduced to zero.
Section
5.10 Monthly
Statements to Certificateholders.
(a) Not
later
than each Distribution Date, the Securities Administrator shall prepare and
make
available to each Holder of Certificates, the Depositor and the Credit Risk
Manager via its website a statement setting forth the following information
for
the Certificates:
(i) the
Interest Accrual Period and general Distribution Dates for each Class of
Certificates;
(ii) the
Pass-Through Rate for each Class of Certificates with respect to the current
Accrual Period;
(iii) the
total
cash flows received and the general sources thereof;
(iv) the
amount of the related distribution to Holders of each Class allocable to
principal, separately identifying (A) the aggregate amount of any Principal
Prepayments included therein, (B) the aggregate of all scheduled payments of
principal included therein, (C) the amount of Prepayment Charges distributed
to
the Class P Certificates and (D) the Monthly Excess Interest, if
any;
(v) the
amount distributed to Holders of each Class on such Distribution Date allocable
to interest;
(vi) the
Certificate Principal Balance or Certificate Notional Balance of each Class
of
Certificates, if applicable, after giving effect (i) to all distributions
allocable to principal on such Distribution Date and (ii) the allocation of
any
Realized Losses for such Distribution Date;
(vii) the
aggregate amount of P&I Advances included in the distributions on the
Distribution Date;
(viii) the
aggregate amount of Relief Act Interest Shortfalls for such Distribution
Date;
(ix) the
aggregate amount of any Prepayment Interest Shortfall for such Distribution
Date, to the extent not covered by payments by the related Servicer pursuant
to
Section 3.27 of this Agreement or the Servicing Agreement, as applicable or
the Master Servicer pursuant to Section 4.14 of this
Agreement;
(x) the
cumulative amount of Realized Losses for the Mortgage Loans to date and, in
addition, if the Certificate Principal Balance of any Class of Certificates
have
been reduced to zero, the cumulative amount of any Realized Losses that have
not
been allocated to any Class of Certificates;
(xi) the
Overcollateralization Amount, the Senior Enhancement Percentage, any
Overcollateralization Deficiency Amount and any Overcollateralization Release
Amount for such Distribution Date;
(xii) the
amount of any Prepayment Charges remitted by the Servicers;
(xiii) the
number, aggregate principal balance, weighted average remaining term to maturity
and weighted average Mortgage Rate of the Mortgage Loans as of the related
Due
Date;
(xiv) the
number and Scheduled Principal Balance of all the Mortgage Loans for the
following Distribution Date;
(xv) the
number and aggregate principal balance of any Mortgage Loans that were (A)
delinquent (exclusive of Mortgage Loans in foreclosure) using the “OTS” method
(1) one scheduled payment is delinquent, (2) two scheduled payments are
delinquent, (3) three scheduled payments are delinquent and (4) foreclosure
proceedings have been commenced, and loss information for the period; the number
and aggregate principal balance of any Mortgage Loans in respect of which (A)
one scheduled payment is delinquent, (B) two scheduled payments are delinquent,
(C) three or more scheduled payments are delinquent and (D) foreclosure
proceedings have been commenced, and loss information for the
period;
(xvi) with
respect to any Mortgage Loan that was liquidated during the preceding calendar
month, the loan number and the Stated Principal Balance of, and Realized Loss
on, such Mortgage Loan as of the close of business on the Determination Date
preceding such Distribution Date;
(xvii) the
total
number and principal balance of any real estate owned or REO Properties and
the
Mortgage Loans in the aggregate as of the close of business on the Determination
Date preceding such Distribution Date;
(xviii) the
three
month rolling average of the percent equivalent of a fraction, the numerator
of
which is the aggregate scheduled principal balance of the Mortgage Loans that
are sixty (60) days or more delinquent or are in bankruptcy or foreclosure
or
are REO Properties, and the denominator of which is the scheduled principal
balances of all of the Mortgage Loans, as applicable as of the last day of
such
Distribution Date;
(xix) the
aggregate Stated Principal Balance of Mortgage Loans that are sixty (60) days
or
more delinquent or are in bankruptcy or foreclosure or are REO
properties;
(xx) the
aggregate Servicing Fees received by the Servicers during the related Due
Period;
(xxi) the
amount of the Credit Risk Management Fees paid to the Credit Risk Manager and/or
the Sponsor for such Distribution Date;
(xxii) the
amount, if any, of other fees or expenses accrued and paid, with an
identification of the payee and the general purpose of such fees;
(xxiii) the
amount of any Basis Risk Shortfalls and the amount in the Basis Risk Shortfall
Reserve Fund after all deposits and withdrawals on such Distribution
Date;
(xxiv) amounts
payable in respect of the Swap Agreement; and
(xxv) whether
the Stepdown Date has occurred and whether any Trigger Event or Sequential
Trigger Event is in effect.
The
Securities Administrator may make the foregoing monthly statement (and, at
its
option, any additional files containing the same information in an alternative
format) available each month to Certificateholders via the Securities
Administrator’s internet website. The Securities Administrator’s internet
website shall initially be located at “xxx.xxxxxxx.xxx”. Assistance in using the
website can be obtained by calling the Securities Administrator’s customer
service desk at (000) 000-0000. Parties that are unable to use the above
distribution options are entitled to have a paper copy mailed to them via first
class mail by calling the customer service desk and indicating such. The
Securities Administrator may change the way monthly statements are distributed
in order to make such distributions more convenient or more accessible to the
above parties.
The
Securities Administrator shall be entitled to rely on but shall not be
responsible for the content or accuracy of any information provided by third
parties for purposes of preparing such statement and may affix thereto any
disclaimer it deems appropriate in its reasonable discretion (without suggesting
liability on the part of any other party hereto).
(b) The
Securities Administrator’s responsibility for making the above information
available to the Certificateholders is limited to the availability, timeliness
and accuracy of the information provided by the Servicers, the Cap Provider
and
the Swap Provider. The Securities Administrator will make available a copy
of
each statement provided pursuant to this Section 5.10 to each Rating
Agency.
(c) Within
a
reasonable period of time after the end of each calendar year, the Securities
Administrator shall cause to be furnished upon written request to each Person
who at any time during the calendar year was a Certificateholder, a statement
containing the information set forth in clauses (a)(i) and (a)(ii) of this
Section 5.10 aggregated for such calendar year or applicable portion
thereof during which such Person was a Certificateholder. Such obligation of
the
Securities Administrator shall be deemed to have been satisfied to the extent
that substantially comparable information shall be provided by the Securities
Administrator pursuant to any requirements of the Code as from time to time
in
effect.
(d) Upon
filing with the Internal Revenue Service, the Securities Administrator shall
furnish to the Holders of the Residual Certificates the applicable Form 1066
and
each applicable Form 1066Q and shall respond promptly to written requests made
not more frequently than quarterly by any Holder of a Residual Certificate
with
respect to the following matters:
(i) The
original projected principal and interest cash flows on the Closing Date on
each
Class of regular and residual interests created hereunder and on the Mortgage
Loans, based on the Prepayment Assumption;
(ii) The
projected remaining principal and interest cash flows as of the end of any
calendar quarter with respect to each Class of regular and residual interests
created hereunder and the Mortgage Loans, based on the Prepayment
Assumption;
(iii) The
applicable Prepayment Assumption and any interest rate assumptions used in
determining the projected principal and interest cash flows described
above;
(iv) The
original issue discount (or, in the case of the Mortgage Loans, market discount)
or premium accrued or amortized through the end of such calendar quarter with
respect to each Class of regular or residual interests created hereunder and
to
the Mortgage Loans, together with each constant yield to maturity used in
computing the same;
(v) The
treatment of losses realized with respect to the Mortgage Loans or the regular
interests created hereunder, including the timing and amount of any cancellation
of indebtedness income of a REMIC with respect to such regular interests or
bad
debt deductions claimed with respect to the Mortgage Loans;
(vi) The
amount and timing of any non-interest expenses of a REMIC; and
(vii) Any
taxes
(including penalties and interest) imposed on the REMIC, including, without
limitation, taxes on “prohibited transactions,” “contributions” or “net income
from foreclosure property” or state or local income or franchise
taxes.
The
information pursuant to clauses (i), (ii), (iii) and (iv) above shall be
provided by the Depositor pursuant to Section 9.13.
Section
5.11 REMIC
Designations and REMIC Allocations.
(a) The
Securities Administrator shall elect that each of REMIC I, REMIC II, REMIC
III,
REMIC IV, REMIC V and REMIC VI shall be treated as a REMIC under Section 860D
of
the Code. Any inconsistencies or ambiguities in this Agreement or in the
administration of this Agreement shall be resolved in a manner that preserves
the validity of such REMIC elections. The REMIC I Regular Interests shall
constitute the assets of REMIC II. The REMIC II Regular Interests shall
constitute the assets of REMIC III, the Class X Interest shall constitute the
assets of REMIC IV, The Class P Interest shall constitute the assets of REMIC
V
and the Class IO Interest shall constitute the assets of REMIC VI.
(b) Reserved;
(c) Reserved;
(d) On
each
Distribution Date, the following amounts, in the following order of priority,
shall be distributed by REMIC I to REMIC II on account of the REMIC I Regular
Interests or withdrawn from the Distribution Account and distributed to the
Holders of the Class R-1 Interest, as the case may be:
(i) to
Holders of each of REMIC I Regular Interest I and REMIC I Regular Interest
I-1-A
through I-60-B, pro rata, in an amount equal to (A) the Uncertificated Accrued
Interest for such REMIC I Regular Interests for such Distribution Date, plus
(B)
any amounts payable in respect thereof remaining unpaid from previous
Distribution Dates;
(ii) to
the
extent of amounts remaining after the distributions made pursuant to clause
(i)
above, payments of principal shall be allocated as follows: first, to REMIC
I
Regular interests I-1-A through I-60-B starting with the lowest numerical
denomination until the Uncertificated Principal Balance of each such REMIC
I
Regular Interest is reduced to zero, provided that, for REMIC I Regular
Interests with the same numerical denomination, such payments of principal
shall
be allocated pro rata between such REMIC I Regular Interests, and second, to
the
extent of any Overcollateralization Release Amounts, to REMIC I Regular Interest
I until the Uncertificated Principal Balance of such REMIC I Regular Interest
is
reduced to zero; and
(iii) to
the
Holders of REMIC I Regular Interest LT-P, (A) on each Distribution Date, 100%
of
the amount paid in respect of Prepayment Charges on the Mortgage Loans and
(B)
on the Distribution Date in September 2011 until $100 has been distributed
pursuant to this clause.
(e) On
each
Distribution Date, the following amounts, in the following order of priority,
shall be distributed by REMIC II to REMIC III on account of the REMIC II Regular
Interests or withdrawn from the Distribution Account and distributed to the
Holders of the Class R-2 Interest, as the case may be:
(iv) first,
to
the Holders of REMIC II Regular Interest LT-IO, in an amount equal to (A)
Uncertificated Accrued Interest for such REMIC II Regular Interest for such
Distribution Date, plus (B) any amounts in respect thereof remaining unpaid
from
previous Distribution Dates and then to the Holders of REMIC II Regular Interest
LT-AA, REMIC II Regular Interest LT-A1A, REMIC II Regular Interest LT-A1B,
REMIC
II Regular Interest LT-A2, REMIC II Regular Interest LT-A3A, REMIC II Regular
Interest LT-A3B, REMIC II Regular Interest LT-A4A, REMIC II Regular Interest
LT-A4B, REMIC II Regular Interest LT-M1, REMIC II Regular Interest LT-M2, REMIC
II Regular Interest LT-M3, REMIC II Regular Interest LT-M4, REMIC II Regular
Interest LT-M5 and REMIC II Regular Interest LT-ZZ, pro rata, in an amount
equal
to (A) the Uncertificated Accrued Interest for each such REMIC II Regular
Interest for such Distribution Date, plus (B) any amounts in respect thereof
remaining unpaid from previous Distribution Dates. Amounts payable as
Uncertificated Accrued Interest in respect of REMIC II Regular Interest LT-ZZ
shall be reduced and deferred when the REMIC II Overcollateralization Amount
is
less than the REMIC II Targeted Overcollateralization Amount, by the lesser
of
(x) the amount of such difference and (y) the REMIC II Regular Interest LT-ZZ
Maximum Interest Deferral Amount and such amount will be payable to the Holders
of REMIC
II
Regular Interest LT-A1A, REMIC II Regular Interest LT-A1B, REMIC II Regular
Interest LT-A2, REMIC II Regular Interest LT-A3A, REMIC II Regular Interest
LT-A3B, REMIC II Regular Interest LT-A4A, REMIC II Regular Interest LT-A4B,
REMIC II Regular Interest LT-M1, REMIC II Regular Interest LT-M2, REMIC II
Regular Interest LT-M3, REMIC II Regular Interest LT-M4 and REMIC II Regular
Interest LT-M5
in the
same proportion as the Overcollateralization Deficiency is allocated to the
Corresponding Certificates and the Uncertificated Principal Balance of REMIC
II
Regular Interest LT-ZZ shall be increased by such amount;
(v) second,
to the Holders of REMIC II Regular Interests, in an amount equal to the
remainder of the Interest Remittance Amount and the Principal Payment Amount
for
such Distribution Date after the distributions made pursuant to clause (i)
above, allocated as follows:
(A) 98.00%
of
such remainder (other than amounts payable under clause (C) below) to the
Holders of REMIC II Regular Interest LT-AA and REMIC II Regular Interest LTII-P,
until the Uncertificated Principal Balance of such REMIC II Regular Interest
is
reduced to zero, provided, however, that the Uncertificated Principal Balance
of
REMIC II Regular Interest LTII-P shall not be reduced until the Distribution
Date in September 2011 or any Distribution Date thereafter, at which point
such
amount shall be distributed to REMIC II Regular Interest LTII-P, until $100
has
been distributed pursuant to this clause;
(B) 2.00%
of
such remainder, first, to the Holders of REMIC II Regular Interest LT-A1A,
REMIC
II Regular Interest LT-A1B, REMIC II Regular Interest LT-A2, REMIC II Regular
Interest LT-A3A, REMIC II Regular Interest LT-A3B, REMIC II Regular Interest
LT-A4A, REMIC II Regular Interest LT-A4B, REMIC II Regular Interest LT-M1,
REMIC
II Regular Interest LT-M2, REMIC II Regular Interest LT-M3, REMIC II Regular
Interest LT-M4 and REMIC II Regular Interest LT-M5, 1% in the same proportion
as
principal payments are allocated to the Corresponding Certificates, until the
Uncertificated Principal Balances of such REMIC II Regular Interests are reduced
to zero and second, to the Holders of REMIC II Regular Interest LT-ZZ (other
than amounts payable under the proviso below), until the Uncertificated
Principal Balance of such REMIC II Regular Interest is reduced to zero;
and
(C) any
remaining amount to the Holders of the Class R Certificates (in respect of
the
Class R-2 Interest).
provided,
however, that (i) 98.00% and (ii) 2.00% of any principal payments that are
attributable to an Overcollateralization Release Amount shall be allocated
to
Holders of (i) REMIC II Regular Interest LT-AA and REMIC II Regular Interest
LTII-P, in that order and (ii) REMIC II Regular Interest LT-ZZ, respectively;
provided that REMIC II Regular Interest LTII-P shall not be reduced until the
Distribution Date in September 2011, at which point such amount shall be
distributed to REMIC II Regular Interest LTII-P, until $100 has been distributed
pursuant to this clause.
Any
payment of principal and interest on the Class X Certificates shall be deemed
to
be paid to the Class X Interest.
Any
payment of principal and Prepayment Charges on the Class P Certificates shall
be
deemed to be paid to the Class P Interest.
Section
5.12 Prepayment
Charges.
(a) On
each
Distribution Date, all amounts representing Prepayment Charges in respect of
the
Mortgage Loans received during the related Prepayment Period and deposited
in
the Distribution Account will be withdrawn from the Distribution Account and
distributed by the Securities Administrator to the Class P Certificates and
shall not be available for distribution to the holders of any other Class of
Certificates. The payment of such Prepayment Charges shall not reduce the
Certificate Principal Balance of the Class P Certificates.
(b) The
Master Servicer shall not be obligated to recalculate or verify Prepayment
Charges collected by the Servicers and remitted to the Distribution Account
for
distribution to the Certificateholders.
Section
5.13 Class
P Certificate Account.
The
Securities Administrator shall establish and maintain with itself a separate,
segregated trust account titled “Xxxxx Fargo Bank, N.A., for the benefit of
Nomura Asset Acceptance Corporation, Alternative Loan Trust 2006-AR3 Class
P
Certificate Account”. On the Closing Date, the Depositor will deposit, or cause
to be deposited in the Class P Certificate Account $100.00. The amount on
deposit in the Class P Certificate Account shall be held uninvested. On the
September 2011 Distribution Date, the Securities Administrator shall withdraw
the amount on deposit in the Class P Certificate Account and remit such amount
to the Holders of the Class P Certificates, in reduction of the Certificate
Principal Balance thereof.
Section
5.14 Reserved.
Section
5.15 Basis
Risk Shortfall Reserve Fund.
(a) The
Securities Administrator shall establish a Basis Risk Shortfall Reserve Fund
on
behalf of the holders of the Senior Certificates and the Mezzanine Certificates.
The Basis Risk Shortfall Reserve Fund must be an Eligible Account. The Basis
Risk Shortfall Reserve Fund shall be entitled “Basis Risk Shortfall Reserve
Fund, HSBC Bank USA, National Association, as Trustee for the benefit of holders
of Nomura Asset Acceptance Corporation, Mortgage Pass-Through Certificates,
Series 2006-AR3, Class A-1A, Class X-0X, Xxxxx X-0, Class A-3A, Class X-0X,
Xxxxx X-0X, Xxxxx X-0X, Class M-1, Class M-2, Class M-3, Class M-4 and Class
M-5
Certificates. On the Closing Date, the Depositor will deposit, or cause to
be
deposited, into the Basis Risk Shortfall Reserve Fund $1,000. On each
Distribution Date as to which there is a Basis Risk Shortfall payable to any
Class of Certificates, the Securities Administrator shall deposit the amounts
pursuant to paragraphs (H) through (M) of Section 5.06(a)(iii) into the
Basis Risk Shortfall Reserve Fund and the Securities Administrator has been
directed by the Class X Certificateholder to distribute such amounts to the
Holders of the Senior Certificates and Mezzanine Certificates in the amounts
and
priorities set forth in Section 5.06(a)(iii).
(b) The
Basis
Risk Shortfall Reserve Fund is an “outside reserve fund” within the meaning of
Treasury Regulation §1.860G-2(h) and shall be an asset of the Trust Fund but not
an asset of any REMIC. The Securities Administrator on behalf of the Trust
shall
be the nominal owner of the Basis Risk Shortfall Reserve Fund. The Class X
Certificateholders shall be the beneficial owners of the Basis Risk Shortfall
Reserve Fund, subject to the power of the Securities Administrator to transfer
amounts under Section 5.06(a)(iii). Amounts in the Basis Risk Shortfall
Reserve Fund shall be held either uninvested in a trust or deposit account
of
the Securities Administrator with no liability for interest or other
compensation thereof or, at the written direction of the Majority Class X
Certificateholder, be invested in Permitted Investments that mature no later
than the Business Day prior to the next succeeding Distribution Date. All net
income and gain from such investments shall be distributed to the Majority
Class
X Certificateholder, not as a distribution in respect of any interest in any
REMIC, on such Distribution Date. All amounts earned on amounts on deposit
in
the Basis Risk Shortfall Reserve Fund shall be taxable to the Majority Class
X
Certificateholder. Any losses on such investments shall be deposited in the
Basis Risk Shortfall Reserve Fund by the Majority Class X Certificateholder
out
of its own funds immediately as realized. In the event that the Majority Class
X
Certificateholder shall fail to provide investment instructions to the
Securities Administrator, the amounts on deposit in the Basis Risk Shortfall
Reserve Fund shall be held uninvested.
(c) For
federal tax return and information reporting, the value of the right of the
holders of the Senior Certificates and Mezzanine Certificates
to
receive payments from the Basis Risk Shortfall Reserve Fund in respect of any
Basis Risk Shortfall shall
be
zero dollars ($0.00).
Section
5.16 Supplemental
Interest Trust.
(a) On
the
Closing Date, the Securities Administrator shall establish and maintain in
the
name of the Trustee a separate account for the benefit of the holders of the
Senior Certificates and Mezzanine Certificates (the “Supplemental Interest
Trust”). The Supplemental Interest Trust shall be an Eligible Account, and funds
on deposit therein shall be held separate and apart from, and shall not be
commingled with, any other moneys, including, without limitation, other moneys
of the Trustee or of the Securities Administrator held pursuant to this
Agreement.
(b) On
each
Distribution Date, the Securities Administrator shall deposit into the
Supplemental Interest Trust amounts distributable to the Swap Provider by the
Supplemental Interest Trust pursuant to Sections 5.06(a)(i)(A) and
5.06(a)(iii)(O) of this Agreement. On each Distribution Date, the Securities
Administrator shall distribute any such amounts to the Swap Provider pursuant
to
the Swap Agreement, first to pay any Net Swap Payment owed to the Swap Provider
for such Distribution Date, and second to pay any Swap Termination Payment
owed
to the Swap Provider.
(c) On
each
Distribution Date, the Securities Administrator shall deposit into the
Supplemental Interest Trust amounts received by it from the Swap Provider.
On
each Distribution Date, the Securities Administrator shall distribute from
the
Supplemental Interest Trust an amount equal to the amount of any Net Swap
Payment received from the Swap Provider under the Swap Agreement, and make
the
distributions required under Section 5.06(b) of this Agreement.
(d) The
Supplemental Interest Trust constitutes an “outside reserve fund” within the
meaning of Treasury Regulation § 1.860G-2(h) and is not an asset of any REMIC.
The Holders of the Class X Certificates shall be the beneficial owner of the
Supplemental Interest Trust, subject to the power of the Securities
Administrator to transfer amounts under this Agreement. The Securities
Administrator shall keep records that accurately reflect the funds on deposit
in
the Supplemental Interest Trust. The Securities Administrator shall, at the
written direction of the holder of the Majority Class X Certificateholder,
invest amounts on deposit in the Supplemental Interest Trust in Permitted
Investments. In the absence of written direction to the Securities Administrator
from the Majority Class X Certificateholder, all funds in the Supplemental
Interest Trust shall remain uninvested. On each Distribution Date, the
Securities Administrator shall distribute, not in respect of any REMIC, any
interest earned on the Supplemental Interest Trust to the Holders of the Class
X
Certificates.
(e) For
federal income tax purposes, amounts paid to the Supplemental Interest Trust
on
each Distribution Date pursuant to Sections 5.06(a)(i)(A) and 5.06(a)(iii)(O)
shall first be deemed paid to the Supplemental Interest Trust in respect of
REMIC VI Regular Interest Swap-IO to the extent of the amount distributable
on
such REMIC VI Regular Interest Swap-IO on such Distribution Date, and any
remaining amount shall be deemed paid to the Supplemental Interest Trust in
respect of a Class IO Distribution Amount. For federal income tax purposes,
the
Supplemental Interest Trust will be a disregarded entity.
The
Securities Administrator shall treat the Holders of the Certificates (other
than
the Class P, Class X and Residual Certificates) as having entered into a
notional principal contract with respect to the Holders of the Class X
Certificates. Pursuant to each such notional principal contract, all Holders
of
the Certificates (other than the Class P, Class X and Residual Certificates)
shall be treated as having agreed to pay, on each Distribution Date, to the
Holder of the Class X Certificates an aggregate amount equal to the excess,
if
any, of (i) the amount payable on such Distribution Date on the REMIC III
Regular Interest ownership of which is represented by such Class of Certificates
over (ii) the amount payable on such Class of Certificates on such Distribution
Date (such excess, a “Class IO Distribution Amount”). A Class IO Distribution
Amount payable from interest collections shall be allocated pro rata among
such
Certificates based on the amount of interest otherwise payable to such
Certificates, and a Class IO Distribution Amount payable from principal
collections shall be allocated to the most subordinate Class of such
Certificates with an outstanding principal balance to the extent of such
balance. In addition, pursuant to such notional principal contract, the Holder
of the Class X Certificates shall be treated as having agreed to pay Basis
Risk
Shortfalls to the Holders of the Certificates (other than the Class X, Class
P
and Residual Certificates) in accordance with the terms of this Agreement.
Any
payments to such Certificates from amounts deemed received in respect of this
notional principal contract shall not be payments with respect to a Regular
Interest in a REMIC within the meaning of Code Section 860G(a)(1). However,
any
payment from the Certificates (other than the Class X, Class P and Class R
Certificates) of a Class IO Distribution Amount shall be treated for tax
purposes as having been received by the Holders of such Certificates in respect
of the REMIC III Regular Interest ownership of which is represented by such
Certificates, and as having been paid by such Holders to the Supplemental
Interest Trust pursuant to the notional principal contract. Thus, each
Certificate (other than the Class P Certificates and Residual Certificates)
shall be treated as representing not only ownership of a Regular Interest in
REMIC III, but also ownership of an interest in, and obligations with respect
to, a notional principal contract.
(f) The
Sponsor shall provide to the Securities Administrator the value of the right
of
the holders of the Senior Certificates and Mezzanine Certificates to receive
payments from the Supplemental Interest Trust for federal tax return and
information reporting not later than the December 31, 2006.
(g) In
the
event that the Swap Agreement is terminated prior to the Distribution Date
in
September 2011, the Sponsor shall use reasonable efforts to appoint a successor
swap provider using any Swap Termination Payments paid by the Swap Provider.
If
the Sponsor is unable to locate a qualified successor swap provider, any such
Swap Termination Payments will be remitted to the Securities Administrator
for
payment to the holders of the Senior Certificates and Mezzanine Certificates
of
amounts described in Section 5.16(c).
Section
5.17 Tax
Treatment of Swap Payments and Swap Termination Payments.
For
federal income tax purposes, each holder of a Senior Certificate or Mezzanine
Certificate is deemed to own an undivided beneficial ownership interest in
a
REMIC regular interest and the right to receive payments from either the Basis
Risk Shortfall Reserve Fund or the Supplemental Interest Trust in respect of
any
Basis Risk Shortfall Carry-Forward Amounts or the obligation to make payments
to
the Supplemental Interest Trust. For federal income tax purposes, the Securities
Administrator will account for payments to each Senior Certificate and Mezzanine
Certificate as follows: each Senior Certificate and Mezzanine Certificate will
be treated as receiving their entire payment from REMIC III (regardless of
any
Swap Termination Payment or obligation under the Swap Agreement) and
subsequently paying their portion of any Swap Termination Payment in respect
of
each such Class’ obligation under the Swap Agreement. In the event that any such
Class is resecuritized in a REMIC, the obligation under the Swap Agreement
to
pay any such Swap Termination Payment (or any shortfall in Net Swap Payment),
will be made by one or more of the REMIC Regular Interests issued by the
resecuritization REMIC subsequent to such REMIC Regular Interest receiving
its
full payment from any such Senior Certificate and Mezzanine
Certificate.
The
REMIC
Regular Interest corresponding to a Senior Certificate and Mezzanine Certificate
will be entitled to receive interest and principal payments at the times and
in
the amounts equal to those made on the certificate to which it corresponds,
except that (i) the maximum interest rate of that REMIC regular interest will
equal the Net Funds Cap computed for this purpose by limiting the Notional
Amount of the Swap Agreement to the aggregate Stated Principal Balance of the
Mortgage Loans and (ii) any Swap Termination Payment will be treated as being
payable solely from amounts otherwise payable to the Class X Certificates.
As a
result of the foregoing, the amount of distributions and taxable income on
the
REMIC Regular Interest corresponding to a Senior Certificate and Mezzanine
Certificate may exceed the actual amount of distributions on the Senior
Certificate and Mezzanine Certificate.
Section
5.18 Reports
Filed with Securities and Exchange Commission.
(a) (i)For
so
long as the Trust Fund is subject to Exchange Act reporting requirements, within
fifteen (15) days after each Distribution Date (subject to permitted extensions
under the Exchange Act), the Securities Administrator shall prepare and file
on
behalf of the Trust Fund any Form 10-D required by the Exchange Act, in form
and
substance as required by the Exchange Act. The Securities Administrator shall
file each Form 10-D with a copy of the related Monthly Statement attached
thereto. The Securities Administrator shall also include with each Form 10-D
any
disclosure required by the Exchange Act in addition to the Monthly Statement
that is required to be included on Form 10-D (“Additional Form 10-D Disclosure”)
subject to the receipt of such information by the Securities Administrator
from
the entity indicated on Exhibit N as the party responsible for providing that
information. The Securities Administrator will have no duty or liability for
any
failure hereunder to determine or prepare any Additional Form 10-D Disclosure,
except as set forth in the next paragraph.
(ii) As
set
forth on Exhibit N hereto, within 5 calendar days after the related Distribution
Date, (i) the parties to this transaction shall be required to provide to the
Securities Administrator and to the Depositor, to the extent known by a
responsible officer thereof, in XXXXX-compatible form, or in such other form
as
otherwise agreed upon by the Securities Administrator and such party, the form
and substance of any Additional Form 10-D Disclosure, if applicable, together
with an Additional Disclosure Notification in the form of Exhibit H hereto
(an
“Additional Disclosure Notification”) and (ii) the Depositor will approve, as to
form and substance, or disapprove, as the case may be, the inclusion of the
Additional Form 10-D Disclosure on Form 10-D. The Depositor will be responsible
for any reasonable fees and expenses assessed or incurred by the Securities
Administrator in connection with including any Additional Form 10-D Disclosure
on Form 10-D pursuant to this paragraph.
(iii) After
preparing the Form 10-D, the Securities Administrator shall, upon request,
forward electronically a copy of the Form 10-D to the Depositor (provided that
such Form 10-D includes any Additional Form 10-D Disclosure). Within two
Business Days after receipt of such copy, but no later than the 12th calendar
day after the Distribution Date, the Depositor shall notify the Securities
Administrator in writing (which may be furnished electronically) of any changes
to or approval of such Form 10-D. In the absence of receipt of any written
changes or approval, or if the Depositor does not request a copy of a Form
10-D,
the Securities Administrator shall be entitled to assume that such Form 10-D
is
in final form and the Securities Administrator may proceed with the execution
and filing of the Form 10-D. A duly authorized representative of the Master
Servicer shall sign each Form 10-D. If a Form 10-D cannot be filed on time
or if
a previously filed Form 10-D needs to be amended, the Securities Administrator
will follow the procedures set forth in Section 5.17(c)(ii). Promptly (but
no
later than 1 Business Day) after filing with the Commission, the Securities
Administrator will make available on its internet website a final executed
copy
of each Form 10-D filed by the Securities Administrator. Each party to this
Agreement acknowledges that the performance by the Master Servicer and the
Securities Administrator of its duties under this Section 5.17(a) related to
the
timely preparation, execution and filing of Form 10-D is contingent upon such
parties strictly observing all applicable deadlines in the performance of their
duties as set forth in this Agreement. Neither the Master Servicer nor the
Securities Administrator shall have any liability for any loss, expense, damage,
claim arising out of or with respect to any failure to properly prepare, execute
and/or timely file such Form 10-D, where such failure results from the
Securities Administrator’s inability or failure to obtain or receive, on a
timely basis, any information from any other party hereto needed to prepare,
arrange for execution or file such Form 10-D, not resulting from its own
negligence, bad faith or willful misconduct.
(b) (i)For
so
long as the Trust Fund is subject to Exchange Act reporting requirements, within
four (4) Business Days after the occurrence of an event set forth on Exhibit
N
hereto or such other event requiring disclosure on Form 8-K (each such event,
a
“Reportable
Event”),
or if
requested by the Depositor, and subject to receipt of such information by the
Securities Administrator from the entity indicated on Exhibit N as the
responsible party for providing that information, the Securities Administrator
shall prepare and file on behalf of the Trust Fund any Form 8-K, as required
by
the Exchange Act, provided
that the
Depositor shall file the initial Form 8-K in connection with the issuance of
the
Certificates. Any disclosure or information related to a Reportable Event or
that is otherwise required to be included on Form 8-K other than the initial
Form 8-K (“Form
8-K Disclosure Information”)
shall
be reported by the parties set forth on Exhibit
N
to the
Depositor and the Securities Administrator and directed and approved by the
Depositor pursuant to the following paragraph and the Securities Administrator
will have no duty or liability for any failure hereunder to determine or prepare
any Form 8-K Disclosure Information or any Form 8-K, except as set forth in
the
next paragraph.
(ii) As
set
forth on Exhibit N hereto, for so long as the Trust is subject to the Exchange
Act reporting requirements, no later than the close of business (New York City
time) on the 2nd Business Day after the occurrence of a Reportable Event (i)
the
parties to this transaction shall be required to provide to the Securities
Administrator and to the Depositor, to the extent known by a responsible officer
thereof, in XXXXX-compatible form, or in such other form as otherwise agreed
upon by the Securities Administrator and such party, the form and substance
of
any Form 8-K Disclosure Information, if applicable, together with an Additional
Disclosure Notification and (ii) the Depositor will approve, as to form and
substance, or disapprove, as the case may be, the inclusion of the Form 8-K
Disclosure Information. The Depositor will be responsible for any reasonable
fees and expenses assessed or incurred by the Securities Administrator in
connection with including any Form 8-K Disclosure Information on Form 8-K
pursuant to this paragraph.
(iii) After
preparing the Form 8-K, the Securities Administrator shall, upon request,
forward electronically a copy of the Form 8-K to the Depositor. Promptly, but
no
later than the close of business on the third Business Day after the Reportable
Event, the Depositor shall notify the Securities Administrator in writing (which
may be furnished electronically) of any changes to or approval of such Form
8-K.
In the absence of receipt of any written changes or approval, or if the
Depositor does not request a copy of a Form 8-K, the Securities Administrator
shall be entitled to assume that such Form 8-K is in final form and the
Securities Administrator may proceed with the execution and filing of the Form
8-K. A duly authorized representative of the Master Servicer shall sign each
Form 8-K. If a Form 8-K cannot be filed on time or if a previously filed Form
8-K needs to be amended, the Securities Administrator will follow the procedures
set forth in Section 5.17(c)(ii). Promptly (but no later than 1 Business Day)
after filing with the Commission, the Securities Administrator will, make
available on its internet website a final executed copy of each Form 8-K that
is
filed by the Securities Administrator. The parties to this Agreement acknowledge
that the performance by the Master Servicer and the Securities Administrator
of
its duties under this Section 5.17(b) related to the timely preparation,
execution and filing of Form 8-K is contingent upon such parties strictly
observing all applicable deadlines in the performance of their duties under
this
Agreement. Neither the Master Servicer nor the Securities Administrator shall
have any liability for any loss, expense, damage, claim arising out of or with
respect to any failure to properly prepare, execute and/or timely file such
Form
8-K, where such failure results from the Securities Administrator’s inability or
failure to obtain or receive, on a timely basis, any information from any other
party hereto needed to prepare, arrange for execution or file such Form 8-K,
not
resulting from its own negligence, bad faith or willful misconduct.
(c) (i)On
or
prior to January 30 of the first year in which the Securities Administrator
is
able to do so under applicable law, the Securities Administrator shall prepare
and file a Form 15 Suspension Notification relating to the automatic suspension
of reporting in respect of the Trust Fund under the Exchange Act.
(ii) In
the
event that the Securities Administrator is unable to timely file with the
Commission all or any required portion of any Form 8-K, 10-D or 10-K required
to
be filed by this Agreement because required disclosure information was either
not delivered to it or delivered to it after the delivery deadlines set forth
in
this Agreement or for any other reason, the Securities Administrator will
promptly notify electronically the Depositor. In the case of Form 10-D and
10-K,
the parties to this Agreement will cooperate to prepare and file a Form 12b-25
and a 10-D/A and 10-K/A as applicable, pursuant to Rule 12b-25 of the Exchange
Act. In the case of Form 8-K, the Securities Administrator will, upon receipt
of
all required Form 8-K Disclosure Information and upon the approval and direction
of the Depositor, include such disclosure information on the next Form 10-D.
In
the event that any previously filed Form 8-K, 10-D or 10-K needs to be amended
in connection with any Additional Form 10-D Disclosure (other than for the
purpose of restating any monthly report), Additional Form 10-K Disclosure or
Form 8-K Disclosure Information, the Securities Administrator will
electronically notify the Depositor and such other parties to the transaction
as
are affected by such amendment, and such parties will cooperate to prepare
any
necessary 8-K/A, 10-D/A or 10-K/A. Any Form 15, Form 12b-25 or any amendment
to
Form 8-K, 10-D or 10-K shall be signed by a duly authorized representative,
or
senior officer in charge of master servicing, as applicable, of the Master
Servicer. The parties to this Agreement acknowledge that the performance by
the
Master Servicer and the Securities Administrator of its duties under this
Section 5.17(c) related to the timely preparation, execution and filing of
Form
15, a Form 12b-25 or any amendment to Form 8-K, 10-D or 10-K is contingent
upon
each such party performing its duties under this Section. Neither the Master
Servicer nor the Securities Administrator shall have any liability for any
loss,
expense, damage, claim arising out of or with respect to any failure to properly
prepare, execute and/or timely file any such Form 15, Form 12b-25 or any
amendments to Forms 8-K, 10-D or 10-K, where such failure results from the
Securities Administrator’s inability or failure to obtain or receive, on a
timely basis, any information from any other party hereto needed to prepare,
arrange for execution or file such Form 15, Form 12b-25 or any amendments to
Forms 8-K, 10-D or 10-K, not resulting from its own negligence, bad faith or
willful misconduct.
(d) (i)For
so
long as the trust is subject to Exchange Act reporting requirements, within
90
days after the end of each calendar year or such earlier date as may be required
by the Exchange Act (the “10-K
Filing Deadline”),
commencing in March 2007, the Securities Administrator shall prepare and file
on
behalf of the Trust Fund a Form 10-K, in form and substance as required by
the
Exchange Act. Each such Form 10-K shall include the following items, in each
case to the extent they have been delivered to the Securities Administrator
within the applicable time frames set forth in this Agreement, (i) an annual
compliance statement for each Servicing Function Participant (other than the
Custodian), as described under Section 3.13, (ii)(A) the annual reports on
assessment of compliance with servicing criteria for each Servicing Function
Participant, as described under Section 3.14 and the Custodial Agreement, and
(B) if any Servicing Function Participant’s report on assessment of compliance
with servicing criteria described under Section 3.14 identifies any material
instance of noncompliance, disclosure identifying such instance of
noncompliance, or if any Servicing Function Participant’s report on assessment
of compliance with servicing criteria described under Section 3.14 is not
included as an exhibit to such Form 10-K, disclosure that such report is not
included and an explanation why such report is not included, (iii)(A) the
registered public accounting firm attestation report for each Servicing Function
Participant, as described under Section 3.14 and the Custodial Agreement, and
(B) if any registered public accounting firm attestation report described under
Section 3.14 identifies any material instance of noncompliance, disclosure
identifying such instance of noncompliance, or if any such registered public
accounting firm attestation report is not included as an exhibit to such Form
10-K, disclosure that such report is not included and an explanation why such
report is not included, and (iv) a Xxxxxxxx-Xxxxx Certification as described
in
Section 3.18. The Securities Administrator shall also include with each Form
10-K any disclosure or information in addition to (i) through (iv) above that
is
required to be included on Form 10-K as set forth on Exhibit N under Form 10-K
(“Additional
Form 10-K Disclosure”)
subject to receipt of such information by the Securities Administrator from
the
entity indicated on Exhibit N as the responsible party for providing that
information. The Securities Administrator will have no duty or liability for
any
failure hereunder to determine or prepare any Additional Form 10-K Disclosure,
except as set forth in the next paragraph.
(ii) As
set
forth on Exhibit N hereto, no later than March 1 (with a ten-calendar day cure
period) of each year that the Trust is subject to the Exchange Act reporting
requirements, commencing in 2007, (i) the parties to this transaction shall
be
required to provide to the Securities Administrator and to the Depositor, to
the
extent known by a responsible officer thereof, in XXXXX-compatible form, or
in
such other form as otherwise agreed upon by the Securities Administrator and
such party, the form and substance of any Additional Form 10-K Disclosure,
if
applicable, together with an Additional Disclosure Notification and (ii) the
Depositor will approve, as to form and substance, or disapprove, as the case
may
be, the inclusion of the Additional Form 10-K Disclosure on Form 10-K. The
Depositor will be responsible for any reasonable fees and expenses assessed
or
incurred by the Securities Administrator in connection with including any
Additional Form 10-K Disclosure on Form 10-K pursuant to this
paragraph.
(iii) After
preparing the Form 10-K, the Securities Administrator shall, upon request,
forward electronically a copy of the Form 10-K to the Depositor. Within three
Business Days after receipt of such copy, but no later than March 25th, the
Depositor shall notify the Securities Administrator in writing (which may be
furnished electronically) of any changes to or approval of such Form 10-K.
In
the absence of receipt of any written changes or approval, or if the Depositor
does not request a copy of a Form 10-K, the Securities Administrator shall
be
entitled to assume that such Form 10-K is in final form and the Securities
Administrator may proceed with the execution and filing of the Form 10-K. A
senior officer of the Master Servicer in charge of the master servicing function
shall sign the Form 10-K. If a Form 10-K cannot be filed on time or if a
previously filed Form 10-K needs to be amended, the Securities Administrator
will follow the procedures set forth in Section 5.17(c)(ii). Promptly (but
no
later than one (1) Business Day) after filing with the Commission, the
Securities Administrator will make available on its internet website a final
executed copy of each Form 10-K to be filed by the Securities Administrator.
The
parties to this Agreement acknowledge that the performance by the Master
Servicer and the Securities Administrator of its duties under this Section
5.17(d) related to the timely preparation, execution and filing of Form 10-K
is
contingent upon such parties (and any Servicing Function Participant) strictly
observing all applicable deadlines in the performance of their duties under
this
Section 5.17(d), Section 3.13, Section 3.14 and Section 3.18. Neither the Master
Servicer nor the Securities Administrator shall have any liability for any
loss,
expense, damage or claim arising out of or with respect to any failure to
properly prepare and/or timely file such Form 10-K, where such failure results
from the Securities Administrator’s inability or failure to obtain or receive,
on a timely basis, any information from any other party hereto needed to
prepare, arrange for execution or file such Form 10-K, not resulting from its
own negligence, bad faith or willful misconduct.
(e) Each
of
Form 10-D and Form 10-K requires the registrant to indicate (by checking "yes"
or "no") that it "(1) has filed all reports required to be filed by Section
13
or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has
been
subject to such filing requirements for the past 90 days." The Depositor hereby
represents to the Securities Administrator as of the date hereof that the
Depositor has (1) filed all such required reports that (a) the Depositor has
undertaken to file on its own behalf or (b) relate to other securitization
transactions of the Depositor for which Xxxxx Fargo Bank, N.A., in its capacity
as Securities Administrator or similar capacity, does not have the exclusive
obligation to prepare and file during the preceding 12 months; provided,
however, that the Depositor shall not be obligated to make such representation
with respect to any filings made by Xxxxx Fargo on behalf of the Depositor,
and
(2) that it has been subject to such filing requirement for the past 90 days.
The Depositor shall notify the Securities Administrator in writing, no later
than the fifth calendar day after the related Distribution Date with respect
to
the filing of a report on Form 10-D and no later than March 15th with respect
to
the filing of a report on Form 10-K, if the answer to the questions should
be
"no". The Securities Administrator shall be entitled to rely on such
representations in preparing, executing and/or filing any such
report.
(f) The
related Servicer, the Master Servicer, the Depositor, the Custodian, the Sponsor
and Securities Administrator shall indemnify and hold harmless the Depositor,
the Trustee and their respective officers, directors and Affiliates from and
against any losses, damages, penalties, fines, forfeitures, reasonable and
necessary legal fees and related costs, judgments and other costs and expenses
arising out of or based upon a breach of such party’s obligations under this
Section 5.17 or such party’s negligence, bad faith or willful misconduct in
connection therewith.
Notwithstanding
the provisions of Section 11.01, this Section 5.17 may be amended without the
consent of the Certificateholders.
ARTICLE
VI
THE
CERTIFICATES
Section
6.01 The
Certificates.
(a) The
Certificates shall be substantially in the forms attached hereto as Exhibits
A-1
through A-5. The Certificates shall be issuable in registered form, in the
minimum dollar denominations, integral dollar multiples in excess thereof
(except that one Certificate of each Class may be issued in a different amount
which must be in excess of the applicable minimum dollar denomination) and
aggregate dollar denominations as set forth in the following table:
Class
|
Minimum
Denomination
|
Integral
Multiple in Excess of Minimum
|
Original
Certificate Principal Balance
|
Pass-Through
Rate
|
|||||||||
A-1A
|
$
|
25,000
|
$
|
1
|
$
|
80,500,000
|
Class
A-1A Pass-Through Rate
|
||||||
A-1B
|
$
|
25,000
|
$
|
1
|
$
|
8,945,000
|
Class
A-1B Pass-Through Rate
|
||||||
A-2
|
$
|
25,000
|
$
|
1
|
$
|
209,432,000
|
Class
A-2 Pass-Through Rate
|
||||||
A-3A
|
$
|
25,000
|
$
|
1
|
$
|
51,039,000
|
Class
A-3A Pass-Through Rate
|
||||||
A-3B
|
$
|
25,000
|
$
|
1
|
$
|
5,671,000
|
Class
A-3B Pass-Through Rate
|
||||||
A-4A
|
$
|
25,000
|
$
|
1
|
$
|
81,575,000
|
Class
A-4A Pass-Through Rate
|
||||||
A-4B
|
$
|
25,000
|
$
|
1
|
$
|
9,064,000
|
Class
A-4B Pass-Through Rate
|
||||||
M-1
|
$
|
25,000
|
$
|
1
|
$
|
11,429,000
|
Class
M-1 Pass-Through Rate
|
||||||
M-2
|
$
|
25,000
|
$
|
1
|
$
|
5,476,000
|
Class
M-2 Pass-Through Rate
|
||||||
M-3
|
$
|
25,000
|
$
|
1
|
$
|
4,286,000
|
Class
M-3 Pass-Through Rate
|
||||||
M-4
|
$
|
25,000
|
$
|
1
|
$
|
2,381,000
|
Class
M-4 Pass-Through Rate
|
||||||
M-5
|
$
|
25,000
|
$
|
1
|
$
|
2,620,000
|
Class
M-5 Pass-Through Rate
|
||||||
P
|
$
|
1
|
$
|
1
|
$
|
100.00
|
N/A
|
||||||
X
|
$
|
1
|
$
|
1
|
$
|
3,811,351.38
|
Class
X Pass-Through Rate
|
||||||
R
|
N/A
|
N/A
|
N/A
|
N/A
|
Upon
original issue, the Certificates shall be executed and authenticated by the
Securities Administrator and delivered by the Trustee to and upon the written
order of the Depositor. The Certificates shall be executed by manual or
facsimile signature on behalf of the Trust Fund by the Securities Administrator
by an authorized signatory. Certificates bearing the manual or facsimile
signatures of individuals who were at any time the proper officers of the
Securities Administrator shall bind the Trust, notwithstanding that such
individuals or any of them have ceased to hold such offices prior to the
authentication and delivery of such Certificates or did not hold such offices
at
the date of such Certificates. No Certificate shall be entitled to any benefit
under this Agreement or be valid for any purpose, unless there appears on such
Certificate a certificate of authentication substantially in the form provided
herein executed by the Securities Administrator by manual signature, and such
certificate of authentication shall be conclusive evidence, and the only
evidence, that such Certificate has been duly authenticated and delivered
hereunder. All Certificates shall be dated the date of their
authentication.
The
Depositor shall provide, or cause to be provided, to the Securities
Administrator on a continuous basis, an adequate inventory of Certificates
to
facilitate transfers.
(b) The
Class
X Certificates and Class P Certificates offered and sold to Qualified
Institutional Buyers in reliance on Rule 144A under the Securities Act (“Rule
144A”) will be issued in the form of Definitive Certificates.
Section
6.02 Certificate
Register; Registration of Transfer and Exchange of
Certificates.
(a) The
Securities Administrator shall maintain, or cause to be maintained in accordance
with the provisions of Section 6.09, a Certificate Register for the
Certificates in which, subject to the provisions of subsections (b) and (c)
below and to such reasonable regulations as it may prescribe, the Securities
Administrator shall provide for the registration of Certificates and of
Transfers and exchanges of Certificates as herein provided. Upon surrender
for
registration of Transfer of any Certificate, the Securities Administrator shall
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Certificates of the same Class and of like
aggregate Percentage Interest.
At
the
option of a Certificateholder, Certificates may be exchanged for other
Certificates of the same Class in authorized denominations and evidencing the
same aggregate Percentage Interest upon surrender of the Certificates to be
exchanged at the office or agency of the Securities Administrator. Whenever
any
Certificates are so surrendered for exchange, the Securities Administrator
shall
execute, authenticate, and deliver the Certificates that the Certificateholder
making the exchange is entitled to receive. Every Certificate presented or
surrendered for registration of Transfer or exchange shall be accompanied by
a
written instrument of Transfer in form satisfactory to the Securities
Administrator duly executed by the holder thereof or his attorney duly
authorized in writing.
No
service charge to the Certificateholders shall be made for any registration
of
Transfer or exchange of Certificates, but payment of a sum sufficient to cover
any tax or governmental charge that may be imposed in connection with any
Transfer or exchange of Certificates may be required.
All
Certificates surrendered for registration of Transfer or exchange shall be
canceled and subsequently destroyed by the Securities Administrator in
accordance with the Securities Administrator’s customary
procedures.
(b) No
Transfer of a Private Certificate shall be made unless such Transfer is made
pursuant to an effective registration statement under the Securities Act and
any
applicable state securities laws or is exempt from the registration requirements
under the Securities Act and such state securities laws. In the event that
a
Transfer is to be made in reliance upon an exemption from the Securities Act
and
such laws, in order to assure compliance with the Securities Act and such laws,
the Certificateholder desiring to effect such Transfer and such
Certificateholder’s prospective transferee shall each certify to the Securities
Administrator in writing the facts surrounding the Transfer in substantially
the
forms set forth in Exhibit E (the “Transferor Certificate”) and (x) deliver a
letter in substantially the form of either Exhibit F (the “Investment Letter”)
or Exhibit G (the “Rule 144A Letter”) or (y) there shall be delivered to the
Securities Administrator an Opinion of Counsel, at the expense of the
transferor, that such Transfer may be made pursuant to an exemption from the
Securities Act, which Opinion of Counsel shall not be an expense of the
Depositor, the Sponsor, the Securities Administrator, the Trustee or the Trust
Fund. The Depositor shall provide to any Holder of a Private Certificate and
any
prospective transferee designated by any such Holder, information regarding
the
related Certificates and the Mortgage Loans and such other information as shall
be necessary to satisfy the condition to eligibility set forth in Rule
144A(d)(4) for Transfer of any such Certificate without registration thereof
under the Securities Act pursuant to the registration exemption provided by
Rule
144A. The Securities Administrator shall cooperate with the Depositor in
providing the Rule 144A information referenced in the preceding sentence,
including providing to the Depositor such information regarding the
Certificates, the Mortgage Loans and other matters regarding the Trust Fund
as
the Depositor shall reasonably request to meet its obligation under the
preceding sentence. Each Holder of a Private Certificate desiring to effect
such
Transfer shall, and does hereby agree to, indemnify the Securities
Administrator, the Depositor and the Sponsor against any liability that may
result if the Transfer is not so exempt or is not made in accordance with such
federal and state laws.
No
Transfer of an ERISA Restricted Certificate shall be made unless the Securities
Administrator shall have received either (i) a representation from the
transferee of such Certificate acceptable to and in form and substance
satisfactory to the Securities Administrator to the effect that such transferee
is not an employee benefit plan subject to Section 406 of ERISA and/or a
plan subject to Section 4975 of the Code, or a Person acting on behalf of
any such plan or using the assets of any such plan, or (ii) in the case of
any
such ERISA Restricted Certificate presented for registration in the name of
an
employee benefit plan subject to ERISA, or a plan subject to Section 4975
of the Code (or comparable provisions of any subsequent enactments), or a
trustee of any such plan or any other person acting on behalf of any such plan,
an Opinion of Counsel satisfactory to the Securities Administrator for the
benefit of the Securities Administrator, the Depositor and the Servicer and
on
which they may rely to the effect that the purchase and holding of such ERISA
Restricted Certificate is permissible under applicable law, will not result
in
any prohibited transactions under ERISA or Section 4975 of the Code and
will not subject the Securities Administrator, the Depositor or any Servicer
to
any obligation in addition to those expressly undertaken in this Agreement,
which Opinion of Counsel shall not be an expense of the Securities
Administrator, the Depositor or any Servicer. Notwithstanding anything else
to
the contrary herein, any purported transfer of an ERISA Restricted Certificate
to or on behalf of an employee benefit plan subject to Section 406 of ERISA
and/or a plan subject to Section 4975 of the Code other than in compliance
with the foregoing shall be void and of no effect; provided that the restriction
set forth in this sentence shall not be applicable if there has been delivered
to the Securities Administrator an Opinion of Counsel meeting the requirements
of clause (ii) of the first sentence of this paragraph. The Securities
Administrator shall not be under any liability to any Person for any
registration of transfer of any ERISA Restricted Certificate that is in fact
not
permitted by this Section 6.02(b) or for making any payments due on such
Certificate to the Holder thereof or taking any other action with respect to
such Holder under the provisions of this Agreement. The Securities Administrator
shall be entitled, but not obligated, to recover from any Holder of any ERISA
Restricted Certificate that was in fact an employee benefit plan subject to
Section 406 of ERISA or a plan subject to Section 4975 of the Code or
a Person acting on behalf of any such plan at the time it became a Holder or,
at
such subsequent time as it became such a plan or Person acting on behalf of
such
a plan, all payments made on such ERISA Restricted Certificate at and after
either such time. Any such payments so recovered by the Securities Administrator
shall be paid and delivered by the Securities Administrator to the last
preceding Holder of such Certificate that is not such a plan or Person acting
on
behalf of a plan.
Each
beneficial owner of a Mezzanine Certificate acquired after termination of the
Supplemental Interest Trust or any interest therein shall be deemed to have
represented, by virtue of its acquisition or holding of that certificate or
interest therein, that either (i) it is not a Plan or investing with “Plan
Assets”, (ii) it has acquired and is holding such certificate in reliance on the
Exemption, and that it understands that there are certain conditions to the
availability of the Exemption, including that the certificate must be rated,
at
the time of purchase, not lower than “BBB-“ (or its equivalent) by S&P or
Xxxxx’x, and the certificate is so rated or (iii) (1) it is an insurance
company, (2) the source of funds used to acquire or hold the certificate or
interest therein is an “insurance company general account,” as such term is
defined in Prohibited Transaction Class Exemption (“PTCE”) 95-60 and (3) the
conditions in Sections I and III of PTCE 95-60 have been satisfied.
For
so
long as the Supplemental Interest Trust is in existence, each beneficial owner
of Senior Certificate or Subordinate Certificate or any interest therein, shall
be deemed to have represented, by virtue of its acquisition or holding of such
Certificate, or interest therein, that either (i) it is not a Plan or (ii)
(A)
it is an accredited investor within the meaning of the Exemption and (B) the
acquisition and holding of such Certificate and the separate right to receive
payments from the Supplemental Interest Trust are eligible for the exemptive
relief available under one of PTCE 95-60, 91-38, 96-23, 90-1 or
84-14.
(c) (i)Each
Person who has or who acquires any Ownership Interest in a Residual Certificate
shall be deemed by the acceptance or acquisition of such Ownership Interest
to
have agreed to be bound by the following provisions, and the rights of each
Person acquiring any Ownership Interest in a Residual Certificate are expressly
subject to the following provisions:
(A) Each
Person holding or acquiring any Ownership Interest in a Residual Certificate
shall be a Permitted Transferee and shall promptly notify the Securities
Administrator of any change or impending change in its status as a Permitted
Transferee.
(B) In
connection with any proposed Transfer of any Ownership Interest in a Residual
Certificate, the Securities Administrator shall require delivery to it, and
shall not register the Transfer of any Residual Certificate until its receipt
of, an affidavit and agreement (a “Transfer Affidavit and Agreement,” in the
form attached hereto as Exhibit D) from the proposed Transferee, in form and
substance satisfactory to the Securities Administrator, representing and
warranting, among other things, that such Transferee is a Permitted Transferee,
that it is not acquiring its Ownership Interest in the Residual Certificate
that
is the subject of the proposed Transfer as a nominee, trustee or agent for
any
Person that is not a Permitted Transferee, that for so long as it retains its
Ownership Interest in a Residual Certificate, it will endeavor to remain a
Permitted Transferee, and that it has reviewed the provisions of this
Section 6.02(d) and agrees to be bound by them.
(C) Notwithstanding
the delivery of a Transfer Affidavit and Agreement by a proposed Transferee
under clause (B) above, if an authorized officer of the Securities Administrator
who is assigned to this transaction has actual knowledge that the proposed
Transferee is not a Permitted Transferee, no Transfer of an Ownership Interest
in a Residual Certificate to such proposed Transferee shall be
effected.
(D) Each
Person holding or acquiring any Ownership Interest in a Residual Certificate
shall agree (x) to require a Transfer Affidavit and Agreement from any other
Person to whom such Person attempts to transfer its Ownership Interest in a
Residual Certificate and (Y) not to transfer its Ownership Interest unless
it
provides a Transferor Affidavit (in the form attached hereto as Exhibit E)
to
the Securities Administrator stating that, among other things, it has no actual
knowledge that such other Person is not a Permitted Transferee.
(E) Each
Person holding or acquiring an Ownership Interest in a Residual Certificate,
by
purchasing an Ownership Interest in such Certificate, agrees to give the
Securities Administrator written notice that it is a “pass-through interest
holder” within the meaning of temporary Treasury regulation
Section 1.67-3T(a)(2)(i)(A) immediately upon acquiring an Ownership
Interest in a Residual Certificate, if it is, or is holding an Ownership
Interest in a Residual Certificate on behalf of, a “pass-through interest
holder.”
(ii) The
Securities Administrator will register the Transfer of any Residual Certificate
only if it shall have received the Transfer Affidavit and Agreement and all
of
such other documents as shall have been reasonably required by the Securities
Administrator as a condition to such registration. In addition, no Transfer
of a
Residual Certificate shall be made unless the Securities Administrator shall
have received a representation letter from the Transferee of such Certificate
to
the effect that such Transferee is a Permitted Transferee.
(iii) (A)If
any
purported Transferee shall become a Holder of a Residual Certificate in
violation of the provisions of this Section 6.02(d), then the last
preceding Permitted Transferee shall be restored, to the extent permitted by
law, to all rights as holder thereof retroactive to the date of registration
of
such Transfer of such Residual Certificate. The Securities Administrator shall
be under no liability to any Person for any registration of Transfer of a
Residual Certificate that is in fact not permitted by this Section 6.02(d)
or for making any payments due on such Certificate to the holder thereof or
for
taking any other action with respect to such holder under the provisions of
this
Agreement.
(B) If
any
purported Transferee shall become a holder of a Residual Certificate in
violation of the restrictions in this Section 6.02(d) and to the extent
that the retroactive restoration of the rights of the holder of such Residual
Certificate as described in clause (iii)(A) above shall be invalid, illegal
or
unenforceable, then the Securities Administrator shall have the right, without
notice to the holder or any prior holder of such Residual Certificate, to sell
such Residual Certificate to a purchaser selected by the Securities
Administrator on such terms as the Securities Administrator may choose. Such
purported Transferee shall promptly endorse and deliver each Residual
Certificate in accordance with the instructions of the Securities Administrator.
Such purchaser may be the Securities Administrator itself or any Affiliate
of
the Securities Administrator. The proceeds of such sale, net of the commissions
(which may include commissions payable to the Securities Administrator or its
Affiliates), expenses and taxes due, if any, will be remitted by the Securities
Administrator to such purported Transferee. The terms and conditions of any
sale
under this clause (iii)(B) shall be determined in the sole discretion of the
Securities Administrator, and the Securities Administrator shall not be liable
to any Person having an Ownership Interest in a Residual Certificate as a result
of its exercise of such discretion.
(iv) The
Securities Administrator shall make available to the Internal Revenue Service
and those Persons specified by the REMIC Provisions all information necessary
to
compute any tax imposed (A) as a result of the Transfer of an Ownership Interest
in a Residual Certificate to any Person who is a Disqualified Organization,
including the information described in Treasury regulations sections
1.860D-1(b)(5) and 1.860E-2(a)(5) with respect to the “excess inclusions” of
such Residual Certificate and (B) as a result of any regulated investment
company, real estate investment trust, common trust fund, partnership, trust,
estate or organization described in Section 1381 of the Code that holds an
Ownership Interest in a Residual Certificate having as among its record holders
at any time any Person which is a Disqualified Organization. Reasonable
compensation for providing such information may be charged or collected by
the
Securities Administrator.
(v) The
provisions of this Section 6.02(d) set forth prior to this subsection (v)
may be modified, added to or eliminated, provided that there shall have been
delivered to the Securities Administrator at the expense of the party seeking
to
modify, add to or eliminate any such provision the following:
(A) written
notification from each Rating Agency to the effect that the modification,
addition to or elimination of such provisions will not cause such Rating Agency
to downgrade its then-current ratings of any Class of Certificates;
and
(B) an
Opinion of Counsel, in form and substance satisfactory to the Securities
Administrator, to the effect that such modification of, addition to or
elimination of such provisions will not cause any REMIC to cease to qualify
as a
REMIC and will not cause any REMIC, as the case may be, to be subject to an
entity-level tax caused by the Transfer of any Residual Certificate to a Person
that is not a Permitted Transferee or a Person other than the prospective
transferee to be subject to a REMIC-tax caused by the Transfer of a Residual
Certificate to a Person that is not a Permitted Transferee.
(d) Subject
to the preceding subsections, upon surrender for registration of transfer of
any
Certificate at any office or agency of the Securities Administrator maintained
for such purpose pursuant to Section 9.11, the Securities Administrator
shall execute, authenticate and deliver, in the name of the designated
Transferee or Transferees, one or more new Certificates of the same Class of
a
like aggregate Percentage Interest.
(e) At
the
option of the Holder thereof, any Certificate may be exchanged for other
Certificates of the same Class with authorized denominations and a like
aggregate Percentage Interest, upon surrender of such Certificate to be
exchanged at any office or agency of the Securities Administrator maintained
for
such purpose pursuant to Section 9.11. Whenever any Certificates are so
surrendered for exchange, the Securities Administrator shall execute,
authenticate and deliver, the Certificates which the Certificateholder making
the exchange is entitled to receive. Every Certificate presented or surrendered
for transfer or exchange shall (if so required by the Securities Administrator)
be duly endorsed by, or be accompanied by a written instrument of transfer
in
the form satisfactory to the Securities Administrator duly executed by, the
Holder thereof or his attorney duly authorized in writing. In addition, (i)
with
respect to each Class R Certificate, the holder thereof may exchange, in the
manner described above, such Class R Certificate for three separate
certificates, each representing such holder's respective Percentage Interest
in
the Class R-1 Interest, the Class R-2 Interest and the Class R-3 Interest,
respectively, in each case that was evidenced by the Class R Certificate being
exchanged and (ii) with respect to each Class R-X Certificate, the holder
thereof may exchange, in the manner described above, such Class R-X Certificate
for three separate certificates, each representing such holder's respective
Percentage Interest in the Class R-4 Interest, the Class R-5 Interest and the
Class R-6 Interest, respectively, in each case that was evidenced by the Class
R-X Certificate being exchanged.
(f) No
service charge to the Certificateholders shall be made for any transfer or
exchange of Certificates, but the Securities Administrator may require payment
of a sum sufficient to cover any tax or governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
(g) The
preparation and delivery of all certificates and opinions referred to above
in
this Section 6.02 shall not be an expense of the Trust Fund, the Securities
Administrator, the Depositor or the Sponsor.
(h) All
Certificates surrendered for transfer and exchange shall be canceled and
destroyed by the Securities Administrator in accordance with its customary
procedures.
Section
6.03 Mutilated,
Destroyed, Lost or Stolen Certificates.
If
(a)
any mutilated Certificate is surrendered to the Securities Administrator, or
the
Securities Administrator receives evidence to its satisfaction of the
destruction, loss or theft of any Certificate and of the ownership thereof
and
(b) there is delivered to the Securities Administrator such security or
indemnity as may be required by them to save each of them harmless, then, in
the
absence of notice to the Securities Administrator that such Certificate has
been
acquired by a bona fide purchaser, the Securities Administrator shall execute,
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of like Class, tenor
and Percentage Interest. In connection with the issuance of any new Certificate
under this Section 6.03, the Securities Administrator may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto and any other expenses (including the fees
and expenses of the Securities Administrator) connected therewith. Any
replacement Certificate issued pursuant to this Section 6.03 shall
constitute complete and indefeasible evidence of ownership in the Trust Fund,
as
if originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time. All Certificates surrendered to the Securities
Administrator under the terms of this Section 6.03 shall be canceled and
destroyed by the Securities Administrator in accordance with its standard
procedures without liability on its part.
Section
6.04 Persons
Deemed Owners.
The
Depositor, the Servicers, the Trustee, the Master Servicer, the Securities
Administrator and any of their agents may treat the person in whose name any
Certificate is registered as the owner of such Certificate for the purpose
of
receiving distributions as provided in this Agreement and for all other purposes
whatsoever, and none of the Depositor, the Servicers, the Trustee, the Master
Servicer, the Securities Administrator nor any of their agents shall be affected
by any notice to the contrary.
Section
6.05 Access
to List of Certificateholders’ Names and Addresses.
If
three
or more Certificateholders (a) request such information in writing from the
Securities Administrator, (b) state that such Certificateholders desire to
communicate with other Certificateholders with respect to their rights under
this Agreement or under the Certificates, and (c) provide a copy of the
communication that such Certificateholders propose to transmit or if the
Depositor shall request such information in writing from the Securities
Administrator, then the Securities Administrator shall, within ten Business
Days
after the receipt of such request, provide the Depositor or such
Certificateholders at such recipients’ expense the most recent list of the
Certificateholders of the Trust Fund held by the Securities Administrator,
if
any. The Depositor and every Certificateholder, by receiving and holding a
Certificate, agree that the Securities Administrator shall not be held
accountable by reason of the disclosure of any such information as to the list
of the Certificateholders hereunder, regardless of the source from which such
information was derived.
Section
6.06 Book-Entry
Certificates.
The
Regular Certificates, upon original issuance, shall be issued in the form of
one
or more typewritten Certificates representing the Book- Entry Certificates,
to
be delivered to the Depository by or on behalf of the Depositor. Such
Certificates shall initially be registered on the Certificate Register in the
name of the Depository or its nominee, and no Certificate Owner of such
Certificates will receive a definitive certificate representing such Certificate
Owner’s interest in such Certificates, except as provided in Section 6.08.
Unless and until definitive, fully registered Certificates (“Definitive
Certificates”) have been issued to the Certificate Owners of such Certificates
pursuant to Section 6.08:
(a) the
provisions of this Section shall be in full force and effect;
(b) the
Depositor and the Securities Administrator may deal with the Depository and
the
Depository Participants for all purposes (including the making of distributions)
as the authorized representative of the respective Certificate Owners of such
Certificates;
(c) registration
of the Book-Entry Certificates may not be transferred by the Securities
Administrator except to another Depository;
(d) the
rights of the respective Certificate Owners of such Certificates shall be
exercised only through the Depository and the Depository Participants and shall
be limited to those established by law and agreements between the Owners of
such
Certificates and the Depository and/or the Depository Participants. Pursuant
to
the Depository Agreement, unless and until Definitive Certificates are issued
pursuant to Section 6.08, the Depository will make book-entry transfers
among the Depository Participants and receive and transmit distributions of
principal and interest on the related Certificates to such Depository
Participants;
(e) the
Depository may collect its usual and customary fees, charges and expenses from
its Depository Participants;
(f) the
Depositor, the Servicer, the Trustee, the Master Servicer and the Securities
Administrator may rely and shall be fully protected in relying upon information
furnished by the Depository with respect to its Depository Participants;
and
(g) to
the
extent that the provisions of this Section conflict with any other
provisions of this Agreement, the provisions of this Section shall
control.
For
purposes of any provision of this Agreement requiring or permitting actions
with
the consent of, or at the direction of, Certificateholders evidencing a
specified percentage of the aggregate unpaid principal amount of any Class
of
Certificates, such direction or consent may be given by Certificate Owners
(acting through the Depository and the Depository Participants) owning
Book-Entry Certificates evidencing the requisite percentage of principal amount
of such Class of Certificates.
Section
6.07 Notices
to Depository.
Whenever
any notice or other communication is required to be given to Certificateholders
of a Class with respect to which Book-Entry Certificates have been issued,
unless and until Definitive Certificates shall have been issued to the related
Certificate Owners, the Securities Administrator shall give all such notices
and
communications to the Depository.
Section
6.08 Definitive
Certificates.
If,
after
Book-Entry Certificates have been issued with respect to any Certificates,
(a)
the Depositor or the Depository advises the Securities Administrator that the
Depository is no longer willing or able to discharge properly its
responsibilities under the Depository Agreement with respect to such
Certificates and the Securities Administrator or the Depositor is unable to
locate a qualified successor, (b) the Depositor, at its sole option, advises
the
Securities Administrator that it elects to terminate the book-entry system
with
respect to such Certificates through the Depository or (c) after the occurrence
and continuation of either of the events described in clauses (a) or (b) above,
Certificate Owners of such Book-Entry Certificates having not less than fifty
one percent (51%) of the Voting Rights evidenced by any Class of Book-Entry
Certificates advise the Securities Administrator and the Depository in writing
through the Depository Participants that the continuation of a book-entry system
with respect to Certificates of such Class through the Depository (or its
successor) is no longer in the best interests of the Certificate Owners of
such
Class, then the Securities Administrator shall notify all Certificate Owners
of
such Certificates, through the Depository, of the occurrence of any such event
and of the availability of Definitive Certificates to applicable Certificate
Owners requesting the same. The Depositor shall provide the Securities
Administrator with an adequate inventory of certificates to facilitate the
issuance and transfer of Definitive Certificates. Upon surrender to the
Securities Administrator of any such Certificates by the Depository, accompanied
by registration instructions from the Depository for registration, the
Securities Administrator shall countersign and deliver such Definitive
Certificates. Neither the Depositor nor the Securities Administrator shall
be
liable for any delay in delivery of such instructions and each may conclusively
rely on, and shall be protected in relying on, such instructions. Upon the
issuance of such Definitive Certificates, all references herein to obligations
imposed upon or to be performed by the Depository shall be deemed to be imposed
upon and performed by the Securities Administrator, to the extent applicable
with respect to such Definitive Certificates and the Securities Administrator
shall recognize the Holders of such Definitive Certificates as
Certificateholders hereunder.
Section
6.09 Maintenance
of Office or Agency.
Certificates
may be surrendered for registration of transfer or exchange at the applicable
Corporate Trust Office of the Securities Administrator. The Securities
Administrator will give prompt written notice to the Certificateholders of
any
change in such location of any such office or agency.
ARTICLE
VII
THE
DEPOSITOR, THE RELATED SERVICER AND THE MASTER SERVICER
Section
7.01 Liabilities
of the Depositor, the related Servicer and the Master Servicer.
Each
of
the Depositor, the related Servicer and the Master Servicer shall be liable
in
accordance herewith only to the extent of the obligations specifically imposed
upon and undertaken by it herein.
Section
7.02 Merger
or Consolidation of the Depositor, the related Servicer or the Master
Servicer.
(a) Each
of
the Depositor and the related Servicer will keep in full force and effect its
rights and franchises as a corporation (or other entity resulting from merger,
conversion or consolidation to the extent permitted under this Section 7.02)
under the laws of the state of its incorporation or formation, and
will
obtain and preserve its qualification to do business as a foreign corporation
in
each jurisdiction in which such qualification is or shall be necessary to
protect the validity and enforceability of this Agreement, the Certificates
or
any of the Mortgage Loans and to perform its duties under this
Agreement.
The
Master Servicer will keep in full force and effect its existence, rights and
franchises as a national banking association, and will obtain and preserve
its
qualification to do business as a foreign corporation in each jurisdiction
in
which such qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, the Certificates or any of the Mortgage Loans
and to perform its duties under this Agreement.
(b) The
Depositor, the related Servicer or the Master Servicer may be merged, converted,
or consolidated, and any Person resulting from any merger, conversion, or
consolidation to which the Depositor, such Servicer or the Master Servicer
shall
be a party, or any Person succeeding to the business of the Depositor, such
Servicer or the Master Servicer shall be the successor of the Depositor, such
Servicer or the Master Servicer hereunder, without the execution or filing
of
any paper or further act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding, provided that any Successor Servicer
shall have represented that it meets the eligibility criteria set forth in
Section 8.02.
Section
7.03 Indemnification
of the Depositor and Servicing Function Participants.
(a) The
Depositor agrees to indemnify the Indemnified Persons for, and to hold them
harmless against, any loss, liability or expense (including reasonable legal
fees and disbursements of counsel) incurred on their part that may be sustained
in connection with, arising out of, or relating to, any claim or legal action
(including any pending or threatened claim or legal action) relating to this
Agreement or the Certificates (i) related to the Depositor’s failure to perform
its duties in compliance with this Agreement (except as any such loss, liability
or expense shall be otherwise reimbursable pursuant to this Agreement) or (ii)
incurred by reason of the Depositor’s willful misfeasance, bad faith or gross
negligence in the performance of duties hereunder or by reason of reckless
disregard of obligations and duties hereunder. This indemnity shall survive
the
resignation of and the termination of this Agreement.
(b) The
related Servicer agrees to indemnify the Indemnified Persons for, and to hold
them harmless against, any loss, liability or expense (including reasonable
legal fees and disbursements of counsel) incurred on their part that may be
sustained in connection with, arising out of, or relating to, any claim or
legal
action (including any pending or threatened claim or legal action) relating
to
such Servicer’s gross negligence in the performance of its duties under this
Agreement or failure to service the related Mortgage Loans in material
compliance with the terms of this Agreement and for a material breach of any
representation, warranty or covenant of such Servicer contained herein. The
related Servicer shall immediately notify the Trustee if a claim is made by
a
third party with respect to this Agreement or the related Mortgage Loans, assume
(with the consent of the Trustee and with counsel reasonably satisfactory to
the
Trustee) the defense of any such claim and pay all expenses in connection
therewith, including counsel fees, and promptly appeal or pay, discharge and
satisfy any judgment or decree which may be entered against it or any
Indemnified Person in respect of such claim, but failure to so notify the
related Servicer shall not limit its obligations hereunder. The related Servicer
agrees that it will not enter into any settlement of any such claim without
the
consent of the Indemnified Persons unless such settlement includes an
unconditional release of such Indemnified Persons from all liability that is
the
subject matter of such claim. The provisions of this Section 7.03(b) shall
survive termination of this Agreement.
(c) Each
Servicing Function Participant shall indemnify and hold harmless the related
Servicer, the Master Servicer, the Securities Administrator, the Trustee, the
Depositor and the Sponsor and their respective directors, officers, employees,
agents, and affiliates from and against any and all claims, losses, damages,
penalties, fines, forfeitures, reasonable legal fees and related costs,
judgments and other costs and expenses arising out of or based upon (a) any
breach by such party of any if its obligations hereunder, including particularly
its obligations to provide any Assessment of Compliance, Attestation Report,
Compliance Statement, Back-up Certification or any information, data or
materials required to be included in any Exchange Act report, (b) any material
misstatement or material omission in any information, data or materials required
to be contained in (i) any compliance certificate delivered by the such party
pursuant to Section 3.13 of this Agreement, (ii) any assessment or attestation
delivered by such party pursuant to Section 3.14 of this Agreement, (iii) any
back-up certification (in the form of Exhibit M) delivered by such party
pursuant to Section 3.18 of this Agreement or (iv) any disclosure materials
delivered by such party pursuant to Section 5.17 or (c) the negligence, bad
faith or willful misconduct of such party in connection with its performance
hereunder. If the indemnification provided for herein is unavailable or
insufficient to hold harmless the related Servicer, the Master Servicer, the
Securities Administrator, the Trustee, the Depositor and the Sponsor, then
each
such party agrees that it shall contribute to the amount paid or payable by
the
Master Servicer, the Securities Administrator, the Trustee, the Depositor and
the Sponsor as a result of any claims, losses, damages or liabilities incurred
by Master Servicer, the Securities Administrator, the Trustee, the Depositor
and
the Sponsor in such proportion as is appropriate to reflect the relative fault
of the Master Servicer, the Securities Administrator, the Trustee, the Depositor
and the Sponsor on the one hand and such party on the other. This indemnity
shall survive the termination or resignation of the parties hereto or the
termination of this Agreement.
Section
7.04 Limitations
on Liability of the Depositor, Securities Administrator, Master Servicer,
related Servicer and Others.
Subject
to the obligation of the Depositor and the related Servicer to indemnify the
Indemnified Persons pursuant to Section 7.03:
(a) Neither
the Depositor, the Securities Administrator, the Master Servicer nor any of
the
directors, officers, employees or agents of the Depositor, the Securities
Administrator and the Master Servicer shall be under any liability to the
Indemnified Persons, the Trust Fund or the Certificateholders for taking any
action or for refraining from taking any action in good faith pursuant to this
Agreement, or for errors in judgment; provided, however, that this provision
shall not protect the Depositor, the Securities Administrator, the Master
Servicer or any such Person against any breach of warranties, representations
or
covenants made herein or against any specific liability imposed on any such
Person pursuant hereto or against any liability which would otherwise be imposed
by reason of such Person’s willful misfeasance, bad faith or gross negligence in
the performance of duties or by reason of reckless disregard of obligations
and
duties hereunder.
(b) The
Depositor, the Securities Administrator, the Master Servicer and any director,
officer, employee or agent of the Depositor, the Securities Administrator and
the Master Servicer may rely in good faith on any document of any kind prima
facie properly executed and submitted by any Person respecting any matters
arising hereunder.
(c) The
Depositor, the Securities Administrator, the Master Servicer, the related
Servicer, the Trustee, the Custodian and any director, officer, employee or
agent of the Depositor, the Securities Administrator, the Master Servicer,
the
related Servicer, the Trustee or the Custodian shall be indemnified by the
Trust
Fund and held harmless thereby against any loss, liability or expense (including
reasonable legal fees and disbursements of counsel) incurred on their part
that
may be sustained in connection with, arising out of, or relating to this
Agreement, the Custodial Agreement or the Certificates (including any pending
or
threatened claim or legal action), other than (i) with respect to the related
Servicer, such loss, liability or expense related to the Servicer’s failure to
perform its duties in compliance with this Agreement (except as any such loss,
liability or expense shall be otherwise reimbursable pursuant to this Agreement)
or, with respect to the Custodian, to the Custodian’s failure to perform its
duties hereunder, (ii) with respect to the related Servicer, any such loss,
liability or expense incurred by reason of such Servicer’s willful misfeasance,
bad faith or gross negligence in the performance of its duties hereunder or
(iii) with respect to Custodian, any such loss, liability or expense incurred
by
reason of the Custodian’s willful misfeasance, bad faith or gross negligence in
the performance of its duties hereunder.
(d) The
Depositor the Securities Administrator or the Master Servicer shall not be
under
any obligation to appear in, prosecute or defend any legal action that is not
incidental to its duties under this Agreement and that in its opinion may
involve it in any expense or liability; provided, however, that each of the
Depositor, the Securities Administrator and the Master Servicer may in its
discretion, undertake any such action which it may deem necessary or desirable
with respect to this Agreement and the rights and duties of the parties hereto
and the interests of the Certificateholders hereunder. In such event, the legal
expenses and costs of such action and any liability resulting therefrom (except
any loss, liability or expense incurred by reason of willful misfeasance, bad
faith or gross negligence in the performance of duties hereunder or by reason
of
reckless disregard of obligations and duties hereunder) shall be expenses,
costs
and liabilities of the Trust Fund, and the Depositor, the Securities
Administrator and the Master Servicer shall be entitled to be reimbursed
therefor out of the Distribution Account as provided by Section 3.32.
Nothing in this Subsection 7.04(d) shall affect the Master Servicer’s obligation
to take such actions as are necessary to ensure the servicing and administration
of the Mortgage Loans pursuant to this Agreement.
(e) In
taking
or recommending any course of action pursuant to this Agreement, unless
specifically required to do so pursuant to this Agreement, the Trustee shall
not
be required to investigate or make recommendations concerning potential
liabilities which the Trust Fund might incur as a result of such course of
action by reason of the condition of the Mortgaged Properties.
(f) The
Trustee shall not be liable for any acts or omissions of any Servicer, the
Depositor or the Custodian.
Section
7.05 The
related Servicer Not to Resign.
(a) The
related Servicer shall resign from the obligations and duties hereby imposed
on
it except upon the determination that its duties hereunder are no longer
permissible under applicable law or the performance of such duties are no longer
possible in order to comply with applicable law and such incapacity or
impossibility cannot be cured by such Servicer. Any determination permitting
the
resignation of the related Servicer shall be evidenced by an Opinion of Counsel
to such effect delivered to the Master Servicer which Opinion of Counsel shall
be in form and substance acceptable to the Master Servicer. No appointment
of a
successor to the related Servicer shall be effective hereunder unless (a) the
Rating Agencies have confirmed in writing that such appointment will not result
in a downgrade, qualification or withdrawal of the then current ratings assigned
to the Certificates, (b) such successor shall have represented that it is meets
the eligibility criteria set forth in Section 8.02 and (c) such successor
has agreed in writing to assume the obligations of the related Servicer
hereunder. The related Servicer shall provide a copy of the written confirmation
of the Rating Agencies and the agreement executed by such successor to the
Master Servicer. No such resignation shall become effective until a successor
servicer or the Master Servicer shall have assumed the related Servicer’s
responsibilities and obligations hereunder. The related Servicer shall notify
the Master Servicer and the Rating Agencies of its resignation.
(b) Except
as
expressly provided herein, the related Servicer shall not assign or transfer
any
of its rights, benefits or privileges hereunder to any other Person, or delegate
to or subcontract with, or authorize or appoint any other Person to perform
any
of the duties, covenants or obligations to be performed by such Servicer
hereunder. The foregoing prohibition on assignment shall not prohibit the
related Servicer from designating a Subservicer as payee of any indemnification
amount payable to the related Servicer hereunder; provided, however, that as
provided in Section 3.03, no Subservicer or Subcontractor shall be a
third-party beneficiary hereunder and the parties hereto shall not be required
to recognize any Subservicer or Subcontractor as an indemnitee under this
Agreement.
Section
7.06 Termination
of the related Servicer Without Cause; Appointment of Special
Servicer.
(a) For
so
long as the Sponsor retains ownership of the servicing rights with respect
to
any of the Mortgage Loans, the Sponsor may, at its option, terminate the
servicing responsibilities of the related Servicer hereunder with respect to
such Mortgage Loans without cause. No such termination shall become effective
unless and until a successor to such Servicer shall have been appointed to
service and administer the related Mortgage Loans pursuant to the terms and
conditions of this Agreement. No appointment shall be effective unless (i)
such
successor servicer meets the eligibility criteria contained in
Section 8.02, (ii) the Master Servicer shall have consented to such
appointment, (iii) the Rating Agencies have been notified in writing of such
appointment and such successor servicer meets the Minimum Servicing
Requirements, (iv) such successor has agreed to assume the obligations of the
related Servicer hereunder to the extent of the related Mortgage Loans and
(v)
all amounts reimbursable to the related Servicer pursuant to the terms of this
Agreement shall have been paid to the related Servicer by the successor
appointed pursuant to the terms of this Section 7.06 or by the Sponsor
including without limitation, all unreimbursed Advances and Servicing Advances
made by the related Servicer and all out-of-pocket expenses of the related
Servicer incurred in connection with the transfer of servicing to such
successor. The Sponsor shall provide a copy of the written confirmation of
the
Rating Agencies and the agreement executed by such successor to the Trustee
and
the Master Servicer.
The
rights of the Sponsor to terminate the related Servicer pursuant to this Section
7.06(a) will cease to exist if the Sponsor sells or otherwise divests itself
of
its ownership of the servicing rights with respect to the Mortgage Loans;
provided, however, that this Section 7.06(a) will be operative at any time
the
Sponsor retains or comes into possession of such servicing rights.
(b) In
addition, the Sponsor may, at its option, appoint a special servicer with
respect to certain of the Mortgage Loans. The Sponsor and the related Servicer
shall negotiate in good faith with any proposed special servicer with respect
to
the duties and obligations of such special servicer with respect to any such
Mortgage Loan. Any Subservicing Agreement shall contain terms and provisions
not
inconsistent with this Agreement and shall obligate the special servicer to
service such Mortgage Loans in accordance with Accepted Servicing Practices.
The
fee payable to the special servicer for the performance of such duties and
obligations will paid from the Servicing Fee collected by the related Servicer
with respect to each such Mortgage Loan and will be remitted to such special
servicer by the related Servicer.
Section
7.07 Limitation
on Resignation of the Master Servicer.
The
Master Servicer shall not resign from the obligations and duties hereby imposed
on it except upon determination that its duties hereunder are no longer
permissible under applicable law. Any such determination pursuant to the
preceding sentence permitting the resignation of the Master Servicer shall
be
evidenced by an Opinion of Counsel to such effect obtained at the expense of
the
Master Servicer and delivered to the Trustee and the Rating Agencies. No
resignation of the Master Servicer shall become effective until the Trustee
or a
successor Master Servicer meeting the criteria specified in Section 7.08
shall have assumed the Master Servicer’s responsibilities, duties, liabilities
(other than those liabilities arising prior to the appointment of such
successor) and obligations under this Agreement.
Section
7.08 Assignment
of Master Servicing.
The
Master Servicer may sell and assign its rights and delegate its duties and
obligations in its entirety as Master Servicer under this Agreement; provided,
however, that: (i) the purchaser or transferee accepting such assignment and
delegation and assuming the obligations of the Master Servicer hereunder (a)
shall have a net worth of not less than $15,000,000 (unless otherwise approved
by each Rating Agency pursuant to clause (ii) below); (b) shall be reasonably
satisfactory to the Trustee (as evidenced in a writing signed by the Trustee);
and (c) shall execute and deliver to the Trustee an agreement, in form and
substance reasonably satisfactory to the Trustee, which contains an assumption
by such Person of the due and punctual performance and observance of each
covenant and condition to be performed or observed by it as master servicer
under this Agreement, any custodial agreement from and after the effective
date
of such agreement; (ii) each Rating Agency shall be given prior written notice
of the identity of the proposed successor to the Master Servicer and each Rating
Agency’s rating of the Certificates in effect immediately prior to such
assignment, sale and delegation will not be downgraded, qualified or withdrawn
as a result of such assignment, sale and delegation, as evidenced by a letter
to
such effect delivered to the Master Servicer and the Trustee; and (iii) the
Master Servicer assigning the master servicing shall deliver to the Trustee
an
officer’s certificate and an Opinion of Independent counsel, each stating that
all conditions precedent to such action under this Agreement have been completed
and such action is permitted by and complies with the terms of this Agreement.
No such assignment or delegation shall affect any liability of the Master
Servicer arising out of acts or omissions prior to the effective date
thereof.
Section
7.09 Rights
of the Depositor in Respect of the related Servicer and the Master
Servicer.
Each
of
the Master Servicer and the related Servicer shall afford (and any Subservicing
Agreement shall provide that each Subservicer or Subcontractor shall afford)
the
Depositor and the Trustee, upon reasonable notice, during normal business hours,
access to all records maintained by the Master Servicer or the related Servicer
(and any such Subservicer or Subcontractor) in respect of the related Servicer’s
rights and obligations hereunder and access to officers of the Master Servicer
or the related Servicer (and those of any such Subservicer or Subcontractor)
responsible for such obligations, and the Master Servicer shall have access
to
all such records maintained by the related Servicer and any Subservicers. Upon
request, each of the Master Servicer and the related Servicer shall furnish
to
the Depositor and the Trustee its (and any such Subservicer’s or
Subcontractor’s) most recent financial statements and such other information
relating to the Master Servicer’s or the related Servicer’s capacity to perform
its obligations under this Agreement as it possesses (and that any such
Subservicer or Subcontractor possesses). To the extent the Depositor and the
Trustee are informed that such information is not otherwise available to the
public, the Depositor and the Trustee shall not disseminate any information
obtained pursuant to the preceding two sentences without the Master Servicer’s
or the related Servicer’s written consent, except as required pursuant to this
Agreement or to the extent that it is appropriate to do so (i) to its legal
counsel, auditors, taxing authorities or other governmental agencies and the
Certificateholders, (ii) pursuant to any law, rule, regulation, order, judgment,
writ, injunction or decree of any court or governmental authority having
jurisdiction over the Depositor and the Trustee or the Trust Fund, and in any
case, the Depositor or the Trustee, (iii) disclosure of any and all information
that is or becomes publicly known, or information obtained by the Trustee from
sources other than the Depositor, the related Servicer or the Master Servicer,
(iv) disclosure as required pursuant to this Agreement or (v) disclosure of
any
and all information (A) in any preliminary or final offering circular,
registration statement or contract or other document pertaining to the
transactions contemplated by the Agreement approved in advance by the Depositor,
the related Servicer or the Master Servicer or (B) to any affiliate, independent
or internal auditor, agent, employee or attorney of the Trustee having a need
to
know the same, provided that the Trustee advises such recipient of the
confidential nature of the information being disclosed, shall use its best
efforts to assure the confidentiality of any such disseminated non-public
information. Nothing in this Section 7.09 shall limit the obligation of the
related Servicer to comply with any applicable law prohibiting disclosure of
information regarding the Mortgagors and the failure of the related Servicer
to
provide access as provided in this Section 7.09 as a result of such
obligation shall not constitute a breach of this Section. Nothing in this
Section 7.09 shall require the related Servicer to collect, create, collate
or otherwise generate any information that it does not generate in its usual
course of business. The related Servicer shall not be required to make copies
of
or ship documents to any party unless provisions have been made for the
reimbursement of the costs thereof. The Depositor may, but is not obligated
to,
enforce the obligations of the Master Servicer and the related Servicer under
this Agreement and may, but is not obligated to, perform, or cause a designee
to
perform, any defaulted obligation of the Master Servicer or the related Servicer
under this Agreement or exercise the rights of the Master Servicer or the
related Servicer under this Agreement; provided that neither the Master Servicer
nor the related Servicer shall be relieved of any of its obligations under
this
Agreement by virtue of such performance by the Depositor or its designee. The
Depositor shall not have any responsibility or liability for any action or
failure to act by the Master Servicer or the related Servicer and is not
obligated to supervise the performance of the Master Servicer or the related
Servicer under this Agreement or otherwise.
ARTICLE
VIII
DEFAULT;
TERMINATION OF A SERVICER AND MASTER SERVICER
Section
8.01 Events
of Default.
(a) In
case
one or more of the following events of default by a Servicer (each, a “Servicer
Default”) shall occur and be continuing, that is to say:
(ii) any
failure by such Servicer to remit to the Securities Administrator any payment
required to be made under the terms of this Agreement which continues unremedied
for a period of two (2) Business Days; or
(iii) failure
on the part of a
Servicer to
duly
observe or perform in any material respect any other of the covenants or
agreements on the part of such Servicer set forth in this Agreement (other
than
those described in (viii) and (ix) below), the breach of which has a material
adverse effect and which continue unremedied for a period of thirty days after
the date on which written notice of such failure, requiring the same to be
remedied, shall have been given to such Servicer by the Master Servicer or
to
such Servicer and the Master Servicer by the holders of Certificates evidencing
not less than twenty-five percent (25%) of the Voting Rights evidenced by the
Certificates; or
(iv) a
decree
or order of a court or agency or supervisory authority having jurisdiction
for
the appointment of a conservator or receiver or liquidator in any insolvency,
bankruptcy, readjustment of debt, marshaling of assets and liabilities or
similar proceedings, or for the winding-up or liquidation of its affairs, shall
have been entered against such Servicer and such decree or order shall have
remained in force undischarged or unstayed for a period of sixty days;
or
(v) such
Servicer shall consent to the appointment of a conservator or receiver or
liquidator in any insolvency, bankruptcy, readjustment of debt, marshaling
of
assets and liabilities or similar proceedings of or relating to such Servicer
or
of or relating to all or substantially all of its property; or
(vi) such
Servicer shall admit in writing its inability to pay its debts generally as
they
become due, file a petition to take advantage of any applicable insolvency
or
reorganization statute, make an assignment for the benefit of its creditors,
or
voluntarily suspend payment of its obligations; or
(vii) such
Servicer attempts to assign its right to servicing compensation hereunder (other
than any payment by such Servicer to the Sponsor of any portion of the Servicing
Fee payable to such Servicer as provided in a separate side letter between
the
Sponsor and such Servicer) or such Servicer attempts to sell or otherwise
dispose of all or substantially all of its property or assets or to assign
this
Agreement or the servicing responsibilities hereunder or to delegate its duties
hereunder or any portion thereof except, in each case as otherwise permitted
herein; or
(viii) such
Servicer ceases to be qualified to transact business in any jurisdiction where
it is currently so qualified, but only to the extent such non-qualification
materially and adversely affects such Servicer’s ability to perform its
obligations hereunder;
(ix) so
long
as the Trust Fund is subject to Exchange Act reporting requirements, failure
by
such Servicer to duly perform, within the required time period, its obligations
under Sections 3.13, 3.14, 3.18 or 5.12, which default shall not be subject
to notice or a cure period;
(x) after
the
Trust Fund ceases to be subject to Exchange Act reporting requirements, any
failure by such Servicer to duly perform, within the required time period,
its
obligation to provide the annual statements of compliance and attestation
reports described in Sections 3.13 and 3.14 hereof, which failure continues
unremedied for a period of ten (10) Business Days after the date on which
written notice of such failure, requiring the same to be remedied, has been
given to such Servicer by the Master Servicer;
(xi) any
failure by such Servicer (or any successor thereto) to provide, within the
required time period set forth in Section 3.28 hereof, any required reports
or
data pertaining to the related Mortgage Loans, which failure continues
unremedied for a period of thirty (30) days after the date on which written
notice of such failure, requiring the same to be remedied, has been given to
such Servicer (or any successor thereto) by the Master Servicer; or
(xii) with
respect to Wachovia only, an event of default by Wachovia under the Servicing
Agreement
then,
and
in each and every such case, so long as a Servicer Default shall not have been
remedied, the Master Servicer, by notice in writing to the related Servicer
shall with respect to a payment default by such Servicer pursuant to
Section 8.01(i) of this Agreement or pursuant to the Servicing Agreement
and, upon the occurrence and continuance of any other Servicer Default may,
and,
at the written direction of Certificateholders evidencing not less than 25%
of
the Voting Rights shall, in addition to whatever rights the Trustee on behalf
of
the Certificateholders may have under Section 7.03 of this Agreement or the
Servicing Agreement, as applicable and at law or equity to damages, including
injunctive relief and specific performance, terminate all the rights and
obligations of such Servicer under this Agreement or the Servicing Agreement,
as
applicable and in and to the related Mortgage Loans and the proceeds thereof
without compensating such Servicer for the same with respect to a default by
such Servicer. On or after the receipt by such Servicer of such written notice,
all authority and power of the defaulting Servicer under this Agreement or
the
Servicing Agreement, as applicable whether with respect to the related Mortgage
Loans or otherwise, shall pass to and be vested in the Master Servicer. Upon
written request from the Master Servicer the defaulting Servicer shall prepare,
execute and deliver, any and all documents and other instruments, place in
the
Trustee’s (or its Custodian’s) possession all Mortgage Files relating to the
related Mortgage Loans, and do or accomplish all other acts or things necessary
or appropriate to effect the purposes of such notice of termination, whether
to
complete the transfer and endorsement or assignment of the related Mortgage
Loans and related documents, or otherwise, at such Servicer’s sole expense. The
defaulting Servicer shall cooperate with the Master Servicer in effecting the
termination of such Servicer’s responsibilities and rights hereunder or under
the Servicing Agreement, as applicable, including, without limitation, the
transfer to such successor for administration by it of all cash amounts which
shall at the time be credited by the defaulting Servicer to the related
Custodial Account or Escrow Account or thereafter received with respect to
the
related Mortgage Loans or any related REO Property (provided, however, that
the
defaulting Servicer shall continue to be entitled to receive all amounts accrued
or owing to it under this Agreement or the Servicing Agreement, as applicable,
on or prior to the date of such termination, whether in respect of Advances,
Servicing Advances, accrued and unpaid Servicing Fees or otherwise, and shall
continue to be entitled to the benefits of Section 7.04 of this Agreement
or the benefits under the Servicing Agreement, as applicable, notwithstanding
any such termination, with respect to events occurring prior to such
termination). Neither Master Servicer nor the Trustee shall have knowledge
of a
Servicer Default unless a Responsible Officer of the Master Servicer or the
Trustee, as applicable, has actual knowledge or unless written notice of any
Servicer Default is received by the Master Servicer or the Trustee, as
applicable, at its address for notice and such notice references the
Certificates, the Trust Fund or this Agreement.
(b) In
case
one or more of the following events of default by the Master Servicer (each,
a
“Master Servicer Default”) shall occur and be continuing, that is to
say:
(i) any
failure on the part of the Master Servicer duly to observe or perform in any
material respect any other of the covenants or agreements on the part of the
Master Servicer contained in this Agreement, or the breach by the Master
Servicer of any representation and warranty contained in Section 2.03,
which continues unremedied for a period of thirty (30) days after the date
on
which written notice of such failure, requiring the same to be remedied, shall
have been given to the Master Servicer by the Depositor or the Trustee or to
the
Master Servicer, the Depositor and the Trustee by the Holders of Certificates
entitled to at least twenty-five percent (25%) of the Voting Rights;
or
(ii) a
decree
or order of a court or agency or supervisory authority having jurisdiction
in
the premises in an involuntary case under any present or future federal or
state
bankruptcy, insolvency or similar law or the appointment of a conservator or
receiver or liquidator in any insolvency, readjustment of debt, marshalling
of
assets and liabilities or similar proceeding, or for the winding-up or
liquidation of its affairs, shall have been entered against the Master Servicer
and such decree or order shall have remained in force undischarged or unstayed
for a period of ninety (90) days; or
(iii) the
Master Servicer shall consent to the appointment of a conservator or receiver
or
liquidator in any insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings of or relating to it or of or relating to
all
or substantially all of its property; or
(iv) the
Master Servicer shall admit in writing its inability to pay its debts generally
as they become due, file a petition to take advantage of any applicable
insolvency or reorganization statute, make an assignment for the benefit of
its
creditors, or voluntarily suspend payment of its obligations; or
(v) so
long
as the Trust Fund is subject to Exchange Act reporting requirements, failure
by
the Master Servicer to duly perform, within the required time period, its
obligations under Sections 3.13, 3.14, 3.18 or 5.17.
If
a
Master Servicer Default shall occur, then, and in each and every such case,
so
long as such Master Servicer Default shall not have been remedied, the Depositor
or the Trustee may, and at the written direction of the Holders of Certificates
entitled to at least 51% of Voting Rights, the Trustee shall, by notice in
writing to the Master Servicer (and to the Depositor if given by the Trustee
or
to the Trustee if given by the Depositor) with a copy to each Rating Agency,
terminate all of the rights and obligations of the Master Servicer in its
capacity as Master Servicer under this Agreement, to the extent permitted by
law, and in and to the Mortgage Loans and the proceeds thereof. On or after
the
receipt by the Master Servicer of such written notice, all authority and power
of the Master Servicer under this Agreement, whether with respect to the
Certificates (other than as a Holder of any Certificate) or the Mortgage Loans
or otherwise including, without limitation, the compensation payable to the
Master Servicer under this Agreement, shall pass to and be vested in the Trustee
pursuant to and under this Section, and, without limitation, the Trustee is
hereby authorized and empowered, as attorney-in-fact or otherwise, to execute
and deliver, on behalf of and at the expense of the Master Servicer, any and
all
documents and other instruments and to do or accomplish all other acts or things
necessary or appropriate to effect the purposes of such notice of termination,
whether to complete the transfer and endorsement or assignment of the Mortgage
Loans and related documents, or otherwise. The Master Servicer agrees promptly
(and in any event no later than ten Business Days subsequent to such notice)
to
provide the Trustee with all documents and records requested by it to enable
it
to assume the Master Servicer’s functions under this Agreement, and to cooperate
with the Trustee in effecting the termination of the Master Servicer’s
responsibilities and rights under this Agreement (provided, however, that the
Master Servicer shall continue to be entitled to receive all amounts accrued
or
owing to it under this Agreement on or prior to the date of such termination
and
shall continue to be entitled to the benefits of Section 7.03,
notwithstanding any such termination, with respect to events occurring prior
to
such termination). For purposes of this Section 8.01, the Trustee shall not
be deemed to have knowledge of a Master Servicer Default unless a Responsible
Officer of the Trustee assigned to and working in the Trustee’s Corporate Trust
Office has actual knowledge thereof or unless written notice of any event which
is in fact such a Master Servicer Default is received by the Trustee and such
notice references the Certificates, the Trust Fund or this Agreement. The
Trustee shall promptly notify the Rating Agencies of the occurrence of a Master
Servicer Default of which it has knowledge as provided above.
Notwithstanding
the above, the Trustee may, if it shall be unwilling to continue to so act,
or
shall, if it is unable to so act, petition a court of competent jurisdiction
to
appoint, or appoint on its own behalf any established housing and home finance
institution servicer, master servicer, servicing or mortgage servicing
institution having a net worth of not less than $15,000,000 and meeting such
other standards for a successor master servicer as are set forth in this
Agreement, as the successor to such Master Servicer in the assumption of all
of
the responsibilities, duties or liabilities of a master servicer, like the
Master Servicer.
To
the
extent that the costs and expenses of the Trustee related to the termination
of
the Master Servicer, appointment of a successor Master Servicer or the transfer
and assumption of the master servicing by the Trustee (including, without
limitation, (i) all legal costs and expenses and all due diligence costs and
expenses associated with an evaluation of the potential termination of the
Master Servicer as a result of a Master Servicer Default and (ii) all costs
and
expenses associated with the complete transfer of the master servicing,
including all servicing files and all servicing data and the completion,
correction or manipulation of such servicing data as may be required by the
successor Master Servicer to correct any errors or insufficiencies in the
servicing data or otherwise to enable the successor Master Servicer to master
service the Mortgage Loans in accordance with this Agreement) are not fully
and
timely reimbursed by the terminated Master Servicer, the Trustee shall be
entitled to reimbursement of such costs and expenses from the Distribution
Account. Neither the Trustee nor any other successor master servicer shall
be
deemed to be in default hereunder by reason of any failure to make, or any
delay
in making, any distribution hereunder or any portion thereof or any failure
to
perform, or any delay in performing, any duties or responsibilities hereunder,
in either case caused by the failure of the Master Servicer to deliver or
provide, or any delay in delivering or providing, any cash, information,
documents or records to it. Furthermore, neither the Trustee nor any other
successor master servicer shall be liable for any acts or omissions of the
terminated Master Servicer.
Section
8.02 Master
Servicer to Act; Appointment of Successor.
On
and
after the time a Servicer receives a notice of termination pursuant to
Section 8.01 of this Agreement or pursuant to the Servicing Agreement, the
Master Servicer shall become the successor to such Servicer with respect to
the
transactions set forth or provided for herein and after a transition period
(not
to exceed 90 days), shall be subject to all the responsibilities, duties and
liabilities relating thereto placed on the terminated Servicer by the terms
and
provisions hereof or the Servicing Agreement, as applicable, and applicable
law
including the obligation to make Advances pursuant to Article V hereof or the
Servicing Agreement, as applicable, except as otherwise provided herein or
therein; provided, however, that the Master Servicer’s obligation to make
Advances in its capacity as Successor Servicer shall not be subject to such
90-day transition period and the Master Servicer will make any Advance required
to be made by the terminated Servicer on the Distribution Date on which the
terminated Servicer was required to make such Advance. Effective on the date
of
such notice of termination, as compensation therefor, the Master Servicer shall
be entitled to all fees, costs and expenses relating to the related Mortgage
Loans that the terminated Servicer would have been entitled to if it had
continued to act hereunder or under the Servicing Agreement, as applicable,
provided, however, that the Master Servicer shall not be (i) liable for any
acts
or omissions of the terminated Servicer, (ii) obligated to make Advances if
it
is prohibited from doing so under applicable law or determines that such
Advance, if made, would constitute a Nonrecoverable Advance, (iii) responsible
for expenses of the terminated Servicer pursuant to Section 2.03 of this
Agreement or pursuant to the Servicing Agreement or (iv) obligated to deposit
losses on any Permitted Investment directed by the terminated Servicer.
Notwithstanding the foregoing, the Master Servicer or the Trustee, as
applicable, may, if it shall be unwilling to so act, or shall, if it is
prohibited by applicable law from making Advances pursuant to Article VI of
this
Agreement or if it is otherwise unable to so act, appoint, or petition a court
of competent jurisdiction to appoint, any established mortgage loan servicing
institution the appointment of which does not adversely affect the then current
rating of the Certificates by each Rating Agency as the successor to the
terminated Servicer hereunder in the assumption of all or any part of the
responsibilities, duties or liabilities of the terminated Servicer hereunder
or
under the Servicing Agreement. Any Successor Servicer shall (i) be an
institution that is a Xxxxxx Xxx and Xxxxxxx Mac approved seller/servicer in
good standing, that has a net worth of at least $15,000,000 and (ii) be willing
to act as successor servicer of the related Mortgage Loans under this Agreement
or under the Servicing Agreement, and shall have executed and delivered to
the
Depositor and the Trustee an agreement accepting such delegation and assignment,
that contains an assumption by such Person of the rights, powers, duties,
responsibilities, obligations and liabilities of the terminated Servicer (other
than any liabilities of the terminated Servicer hereof incurred prior to
termination of such Servicer under Section 8.01 of this Agreement or under
the Servicing Agreement, as applicable), with like effect as if originally
named
as a party to this Agreement or under the Servicing Agreement, provided that
each Rating Agency shall have acknowledged in writing that its rating of the
Certificates in effect immediately prior to such assignment and delegation
will
not be qualified or reduced as a result of such assignment and delegation.
If
the Master Servicer assumes the duties and responsibilities of the terminated
Servicer in accordance with this Section 8.02, the Master Servicer shall
not resign as servicer until a Successor Servicer has been appointed and has
accepted such appointment. Pending appointment of a successor to the terminated
Servicer hereunder or under this Servicing Agreement, the Master Servicer,
unless such party is prohibited by law from so acting, shall act in such
capacity as hereinabove provided. In connection with such appointment and
assumption, the Master Servicer may make such arrangements for the compensation
of such successor out of payments on the Mortgage Loans or otherwise as it
and
such successor shall agree; provided that no such compensation shall be in
excess of that permitted the terminated Servicer hereunder or under the
Servicing Agreement. The Master Servicer and such successor shall take such
action, consistent with this Agreement, as shall be necessary to effectuate
any
such succession. Neither the Master Servicer nor any other Successor Servicer
shall be deemed to be in default hereunder by reason of any failure to make,
or
any delay in making, any distribution hereunder or any portion thereof or any
failure to perform, or any delay in performing, any duties or responsibilities
hereunder, in either case caused by the failure of the terminated Servicer
to
deliver or provide, or any delay in delivering or providing, any cash,
information, documents or records to it.
The
costs
and expenses of the Master Servicer in connection with the termination of the
terminated Servicer, appointment of a Successor Servicer and, if applicable,
any
transfer of servicing, including, without limitation, all costs and expenses
associated with the complete transfer of all servicing data and the completion,
correction or manipulation of such servicing data as may be required by the
Master Servicer to correct any errors or insufficiencies in the servicing data
or otherwise to enable the Master Servicer or the Successor Servicer to service
the related Mortgage Loans properly and effectively, to the extent not paid
by
the terminated Servicer as may be required herein shall be payable to the Master
Servicer from the Distribution Account pursuant to Section 3.32. Any
successor to the terminated Servicer as successor servicer under this Agreement
shall give notice to the applicable Mortgagors of such change of servicer and
shall, during the term of its service as successor servicer maintain in force
the policy or policies that the terminated Servicer is required to maintain
pursuant to Section 3.05 of this Agreement or pursuant to the Servicing
Agreement.
Section
8.03 Notification
to Certificateholders.
(a) Upon
any
termination of or appointment of a successor to a Servicer or the Master
Servicer, the Trustee shall give prompt written notice thereof to
Certificateholders and to each Rating Agency.
(b) Within
sixty (60) days after the occurrence of any Servicer Default or Master Servicer
Default, the Trustee shall transmit by mail to all Certificateholders notice
of
each such Servicer Default or Master Servicer Default hereunder known to the
Trustee, unless such default shall have been cured or waived.
Section
8.04 Waiver
of Servicer Defaults and Master Servicer Defaults.
The
Trustee may waive only by written notice from Certificateholders evidencing
66-2/3% of the Voting Rights (unless such default materially and adversely
affects all Certificateholders, in which case the written direction shall be
from all of the Certificateholders) any default by a Servicer or the Master
Servicer in the performance of its obligations hereunder or under the Servicing
Agreement and its consequences. Upon any such waiver of a past default, such
default shall cease to exist, and any Servicer Default or Master Servicer
Default arising therefrom shall be deemed to have been remedied for every
purpose of this Agreement. No such waiver shall extend to any subsequent or
other default or impair any right consequent thereon except to the extent
expressly so waived in writing.
ARTICLE
IX
CONCERNING
THE TRUSTEE AND SECURITIES ADMINISTRATOR
Section
9.01 Duties
of Trustee and Securities Administrator.
(a) The
Trustee, prior to the occurrence of a Master Servicer Default, and after the
curing or waiver of all Master Servicer Defaults, which may have occurred,
and
the Securities Administrator each undertake to perform such duties and only
such
duties as are specifically set forth in this Agreement as duties of the Trustee
and the Securities Administrator, respectively. If a Master Servicer Default
has
occurred and has not been cured or waived, the Trustee shall exercise such
of
the rights and powers vested in it by this Agreement, and use the same degree
of
care and skill in their exercise, as a prudent person would exercise or use
under the circumstances in the conduct of such Person’s own affairs. Any
permissive right of the Trustee enumerated in this Agreement shall not be
construed as a duty.
(b) Each
of
the Trustee and the Securities Administrator, upon receipt of all resolutions,
certificates, statements, opinions, reports, documents, orders or other
instruments furnished to it, which are specifically required to be furnished
pursuant to any provision of this Agreement, shall examine them to determine
whether they conform to the requirements of this Agreement. If any such
instrument is found not to conform to the requirements of this Agreement in
a
material manner, the Trustee or the Securities Administrator, as the case may
be, shall take such action as it deems appropriate to have the instrument
corrected, and if the instrument is not corrected to its satisfaction, the
Securities Administrator will provide notice to the Trustee thereof and the
Trustee will provide notice to the Certificateholders.
(c) The
Trustee shall promptly remit to the related Servicer any complaint, claim,
demand, notice or other document (collectively, the “Notices”) delivered to the
Trustee as a consequence of the assignment of any Mortgage Loan hereunder and
relating to the servicing of the Mortgage Loans; provided than any such notice
(i) is delivered to the Trustee at its Corporate Trust Office, (ii) contains
information sufficient to permit the Trustee to make a determination that the
real property to which such document relates is a Mortgaged Property. The
Trustee shall have no duty hereunder with respect to any Notice it may receive
or which may be alleged to have been delivered to or served upon it unless
such
Notice is delivered to it or served upon it at its Corporate Trust Office and
such Notice contains the information required pursuant to clause (ii) of the
preceding sentence.
(d)
No
provision of this Agreement shall be construed to relieve the Trustee or the
Securities Administrator from liability for its own negligent action, its own
negligent failure to act or its own misconduct; provided, however,
that:
(i) Prior
to
the occurrence of a Master Servicer Default and after the curing or waiver
of
all Master Servicer Defaults which may have occurred with respect to the Trustee
and at all times with respect to the Securities Administrator, the duties and
obligations of the Trustee and the Securities Administrator shall be determined
solely by the express provisions of this Agreement, neither the Trustee nor
the
Securities Administrator shall be liable except for the performance of its
duties and obligations as are specifically set forth in this Agreement, no
implied covenants or obligations shall be read into this Agreement against
the
Trustee or the Securities Administrator and, in the absence of bad faith on
the
part of the Trustee or the Securities Administrator, respectively, the Trustee
or the Securities Administrator, respectively, may conclusively rely and shall
be fully protected in acting or refraining from acting, as to the truth of
the
statements and the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Trustee or the Securities
Administrator, respectively, that conform to the requirements of this
Agreement;
(ii) Neither
the Trustee nor the Securities Administrator shall be liable in its individual
capacity for an error of judgment made in good faith by a Responsible Officer
or
Responsible Officers of the Trustee or an officer or officers of the Securities
Administrator, respectively, unless it shall be proved that the Trustee or
Securities Administrator, respectively, was negligent in ascertaining the
pertinent facts;
(iii) Neither
the Trustee nor the Securities Administrator shall be liable with respect to
any
action taken, suffered or omitted to be taken by it in good faith and believed
by it to be authorized or within the rights or powers conferred upon it by
this
Agreement or in accordance with the directions of the Holders of Certificates
evidencing not less than 25% of the aggregate Voting Rights of the Certificates,
if such action or non-action relates to the time, method and place of conducting
any proceeding for any remedy available to the Trustee or the Securities
Administrator or exercising any trust or other power conferred upon the Trustee
or the Securities Administrator under this Agreement;
(iv) The
Trustee shall not be required to take notice or be deemed to have notice or
knowledge of any default or Master Servicer Default unless a Responsible Officer
of the Trustee shall have actual knowledge thereof. In the absence of such
notice, the Trustee may conclusively assume there is no such default or Master
Servicer Default;
(v) The
Trustee shall not in any way be liable by reason of any insufficiency in any
Account held by or in the name of Trustee unless it is determined by a court
of
competent jurisdiction that the Trustee’s gross negligence or willful misconduct
was the primary cause of such insufficiency (except to the extent that the
Trustee is obligor and has defaulted thereon);
(vi) Anything
in this Agreement to the contrary notwithstanding, in no event shall the Trustee
or the Securities Administrator be liable for special, indirect, punitive or
consequential loss or damage of any kind whatsoever (including but not limited
to lost profits), even if the Trustee or the Securities Administrator has been
advised of the likelihood of such loss or damage and regardless of the form
of
action and whether or not any such damages were foreseeable or contemplated;
and
(vii) None
of
the Sponsor, the Depositor or the Trustee shall be responsible for the acts
or
omissions of the other, it being understood that this Agreement shall not be
construed to render them partners, joint venturers or agents of one
another.
Neither
the Trustee nor the Securities Administrator shall be required to expend or
risk
its own funds or otherwise incur liability, financial or otherwise, in the
performance of any of its duties hereunder, or in the exercise of any of its
rights or powers, if there is reasonable ground for believing that the repayment
of such funds or adequate indemnity against such risk or liability is not
reasonably assured to it, and none of the provisions contained in this Agreement
shall in any event require the Trustee or the Securities Administrator to
perform, or be responsible for the manner of performance of, any of the
obligations of the terminated Servicer hereunder.
(e) All
funds
received by the Securities Administrator and required to be deposited in the
Distribution Account pursuant to this Agreement will be promptly so deposited
by
the Securities Administrator.
Section
9.02 Certain
Matters Affecting the Trustee and Securities Administrator.
(a) Except
as
otherwise provided in Section 9.01:
(i) The
Trustee and the Securities Administrator may conclusively rely and shall be
fully protected in acting or refraining from acting in reliance on any
resolution or certificate of the Sponsor, the Depositor or the Servicers, any
certificates of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond or other
paper
or document believed by it to be genuine and to have been signed or presented
by
the proper party or parties;
(ii) The
Trustee and the Securities Administrator may consult with counsel and any advice
of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection with respect to any action taken or suffered or
omitted by it hereunder in good faith and in accordance with such advice or
Opinion of Counsel:
(iii) Neither
the Trustee nor the Securities Administrator shall be under any obligation
to
exercise any of the trusts or powers vested in it by this Agreement, other
than
its obligation to give notices pursuant to this Agreement, or to institute,
conduct or defend any litigation hereunder or in relation hereto at the request,
order or direction of any of the Certificateholders pursuant to the provisions
of this Agreement, unless such Certificateholders shall have offered to the
Trustee or the Securities Administrator, as the case may be, reasonable security
or indemnity satisfactory to it against the costs, expenses and liabilities
which may be incurred therein or thereby. Nothing contained herein shall,
however, relieve the Trustee of the obligation, upon the occurrence of a Master
Servicer Default of which a Responsible Officer of the Trustee has actual
knowledge (which has not been cured or waived), to exercise such of the rights
and powers vested in it by this Agreement, and to use the same degree of care
and skill in their exercise, as a prudent person would exercise or use under
the
circumstances in the conduct of his own affairs;
(iv) Neither
the Trustee nor the Securities Administrator shall be liable in its individual
capacity for any action taken, suffered or omitted by it in good faith and
believed by it to be authorized or within the discretion or rights or powers
conferred upon it by this Agreement;
(v) Prior
to
the occurrence of a Master Servicer Default hereunder and after the curing
or
waiver of all Master Servicer Defaults which may have occurred with respect
to
the Trustee and at all times with respect to the Securities Administrator,
neither the Trustee nor the Securities Administrator shall be bound to make
any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond or other paper or document, unless requested in writing to do
so
by Holders of Certificates evidencing not less than twenty-five percent (25%)
of
the aggregate Voting Rights of the Certificates and provided that the payment
within a reasonable time to the Trustee or the Securities Administrator of
the
costs, expenses or liabilities likely to be incurred by it in the making of
such
investigation is, in the opinion of the Trustee or the Securities Administrator,
as applicable, not reasonably assured to the Trustee or the Securities
Administrator, as applicable, by the security afforded to it by the terms of
this Agreement, the Trustee or the Securities Administrator, as applicable,
may
require reasonable indemnity against such expense or liability as a condition
to
taking any such action. The reasonable expense of every such examination shall
be paid by the Certificateholders requesting the investigation;
(vi) The
Trustee may execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or through Affiliates, nominees, custodians, agents
or
attorneys. The Trustee shall not be liable or responsible for the misconduct
or
negligence of any of the Trustee’s agents or attorneys or paying agent appointed
hereunder by the Trustee with due care;
(vii) Should
the Trustee deem the nature of any action required on its part to be unclear,
the Trustee may require prior to such action that it be provided by the
Depositor with reasonable further instructions; the right of the Trustee to
perform any discretionary act enumerated in this Agreement shall not be
construed as a duty, and the Trustee shall not be accountable for other than
its
gross negligence or willful misconduct in the performance of any such
act;
(viii) The
Trustee shall not be required to give any bond or surety with respect to the
execution of the trust created hereby or the powers granted
hereunder;
(ix) The
Trustee shall not have any duty to conduct any affirmative investigation as
to
the occurrence of any condition requiring the repurchase of any Mortgage Loan
by
any Person pursuant to this Agreement, or the eligibility of any Mortgage Loan
for purposes of this Agreement;
(x) The
Trustee shall have no duty hereunder with respect to any complaint, claim,
demand, notice or other document it may receive or which may be alleged to
have
been delivered or served upon it by the parties as a consequence of the
assignment of any Mortgage Loan hereunder; provided, however that the Trustee
shall promptly remit to the Servicer upon receipt any such complaint, claim,
demand, notice or other document (i) which is delivered to the Trustee at is
Corporate Trust Office, (ii) of which a Responsible Officer has actual knowledge
and (iii) which contains information sufficient to permit the Trustee to make
a
determination that the real property to which such document relates is a
Mortgaged Property; and
(xi) The
Trustee is hereby directed by the Depositor to execute the Swap Agreement on
behalf of the Supplemental Interest Trust in the form presented to it by the
Depositor and shall have no responsibility for the contents of the Swap
Agreement, including, without limitation, the representations and warranties
contained therein. Any funds payable by the Trustee under the Swap Agreement
at
closing shall be paid by the Depositor. Notwithstanding anything to the contrary
contained herein or in the Swap Agreement, the Trustee shall not be required
to
make any payments to the Swap Provider.
(xii) None
of
the Securities Administrator, the Master Servicer, the Servicer, the Sponsor,
the Depositor, the Custodian or the Trustee shall be responsible for the acts
or
omissions of the others or of the Swap Provider, it being understood that this
Agreement shall not be construed to render them partners, joint venturers or
agents of one another.
Section
9.03 Trustee
and Securities Administrator not Liable for Certificates or Mortgage
Loans.
The
recitals contained herein and in the Certificates (other than the signature
of
the Securities Administrator, the authentication of the Securities Administrator
on the Certificates, the acknowledgements of the Trustee contained in Article
II
and the representations and warranties of the Trustee in Section 9.12)
shall be taken as the statements of the Depositor, and neither the Trustee
nor
the Securities Administrator assumes any responsibility for their correctness.
Neither the Trustee nor the Securities Administrator makes any representations
or warranties as to the validity or sufficiency (other than as specifically
set
forth in Section 9.12) of the Swap Agreement, the Certificates (other than
the signature of the Securities Administrator and authentication of the
Securities Administrator on the Certificates) or of any Mortgage Loan except
as
expressly provided in Section 2.02. The Securities Administrator’s signature and
authentication (or authentication of its agent) on the Certificates shall be
solely in its capacity as Securities Administrator and shall not constitute
the
Certificates an obligation of the Securities Administrator in any other
capacity. The Trustee and the Securities Administrator shall not be accountable
for the use or application by the Depositor of any of the Certificates or of
the
proceeds of such Certificates, or for the use or application of any funds paid
to the Depositor with respect to the Mortgage Loans.
Section
9.04 Trustee
and Securities Administrator May Own Certificates.
Each
of
the Trustee and the Securities Administrator in its individual capacity or
in
any other capacity other than as Trustee or Securities Administrator hereunder
may become the owner or pledgee of any Certificates and may transact business
with other interested parties and their Affiliates with the same rights it
would
have if it were not the Trustee or the Securities Administrator.
Section
9.05 Fees
and Expenses of Trustee and Securities Administrator.
The
fees
of the Trustee and the Securities Administrator hereunder shall be paid in
accordance with a side letter agreement with the Master Servicer and at the
sole
expense of the Master Servicer. In addition, the Trustee, the Securities
Administrator, the Custodian and any director, officer, employee or agent of
the
Trustee, the Securities Administrator and the Custodian shall be indemnified
by
the Trust Fund and held harmless against any loss, liability or expense
(including reasonable attorney’s fees and expenses) incurred by the Trustee, the
Custodian or the Securities Administrator including any pending or threatened
claim or legal action arising out of or in connection with the acceptance or
administration of its respective obligations and duties under this Agreement,
including the Swap Agreement and any and all other agreements related hereto,
other than any loss, liability or expense (i) for which the Trustee is
indemnified by the Master Servicer or the related Servicer, (ii) that
constitutes a specific liability of the Trustee or the Securities Administrator
pursuant to this Agreement or (iii) any loss, liability or expense incurred
by
reason of willful misfeasance, bad faith or negligence in the performance of
duties hereunder by the Trustee or the Securities Administrator or by reason
of
reckless disregard of obligations and duties hereunder. In no event shall the
Trustee or the Securities Administrator be liable for special, indirect or
consequential loss or damage of any kind whatsoever (including but not limited
to lost profits), even if it has been advised of the likelihood of such loss
or
damage and regardless of the form of action. The Master Servicer agrees to
indemnify the Trustee, from, and hold the Trustee harmless against, any loss,
liability or expense (including reasonable attorney’s fees and expenses)
incurred by the Trustee by reason of the Master Servicer’s willful misfeasance,
bad faith or gross negligence in the performance of its duties under this
Agreement or by reason of the Master Servicer’s reckless disregard of its
obligations and duties under this Agreement. The indemnities in this
Section 9.05 shall survive the termination or discharge of this Agreement
and the resignation or removal of the Master Servicer, the Trustee, the
Securities Administrator or the Custodian. Any payment hereunder made by the
Master Servicer to the Trustee shall be from the Master Servicer’s own funds,
without reimbursement from any REMIC therefor.
Section
9.06 Eligibility
Requirements for Trustee and Securities Administrator.
The
Trustee and the Securities Administrator shall at all times be a corporation
or
an association (other than the Depositor, the Sponsor or any Affiliate of the
foregoing) organized and doing business under the laws of any state or the
United States of America, authorized under such laws to exercise corporate
trust
powers, having a combined capital and surplus of at least $50,000,000 (or a
member of a bank holding company whose capital and surplus is at least
$50,000,000) and subject to supervision or examination by federal or state
authority. If such corporation or association publishes reports of conditions
at
least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then for the purposes of this
Section the combined capital and surplus of such corporation or association
shall be deemed to be its combined capital and surplus as set forth in its
most
recent report of conditions so published. In case at any time the Trustee or
the
Securities Administrator, as applicable, shall cease to be eligible in
accordance with the provisions of this Section, the Trustee or the Securities
Administrator, as applicable, shall resign immediately in the manner and with
the effect specified in Section 9.07.
Additionally,
the Securities Administrator (i) may not be an originator, Master Servicer,
any
Servicer, Depositor or an affiliate of the Depositor unless the Securities
Administrator is in an institutional trust department, (ii) must be authorized
to exercise corporate trust powers under the laws of its jurisdiction of
organization, and (iii) must be rated at least "A-1" by S&P (or such rating
acceptable to Fitch pursuant to a rating confirmation). Xxxxx Fargo Bank, N.A.
shall act as Securities Administrator for so long as it is Master Servicer
under
this Agreement.
Section
9.07 Resignation
and Removal of Trustee and Securities Administrator.
The
Trustee and the Securities Administrator may at any time resign (including,
without limitation, and in the case of the Securities Administrator, upon the
resignation or removal of the Master Servicer) and be discharged from the trust
hereby created by giving written notice thereof to the Depositor, to the Master
Servicer, to the Securities Administrator (or the Trustee, if the Securities
Administrator resigns) and to the Certificateholders. Upon receiving such notice
of resignation, the Depositor shall promptly appoint a successor trustee or
successor securities administrator by written instrument, in duplicate, which
instrument shall be delivered to the resigning Trustee or Securities
Administrator, as applicable, and to the successor trustee or successor
securities administrator, as applicable. A copy of such instrument shall be
delivered to the Certificateholders, the Trustee, the Securities Administrator
and the Master Servicer by the Depositor. If no successor trustee or successor
securities administrator shall have been so appointed and have accepted
appointment within thirty (30) days after the giving of such notice of
resignation, the resigning Trustee or Securities Administrator, as the case
may
be, may, at the expense of the Trust Fund, petition any court of competent
jurisdiction for the appointment of a successor trustee or successor securities
administrator, as applicable.
If
at any
time the Trustee or the Securities Administrator shall cease to be eligible
in
accordance with the provisions of Section 9.06 and shall fail to resign
after written request therefor by the Depositor, or if at any time the Trustee
or the Securities Administrator shall become incapable of acting, or shall
be
adjudged bankrupt or insolvent, or a receiver of the Trustee or the Securities
Administrator or of its property shall be appointed, or any public officer
shall
take charge or control of the Trustee or the Securities Administrator or of
its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, then the Depositor may remove the Trustee or the Securities
Administrator, as applicable and appoint a successor trustee or successor
securities administrator, as applicable, by written instrument, in duplicate,
which instrument shall be delivered to the Trustee or the Securities
Administrator so removed and to the successor trustee or successor securities
administrator. A copy of such instrument shall be delivered to the
Certificateholders, the Trustee, the Securities Administrator and the Master
Servicer by the Depositor.
The
Holders of Certificates entitled to at least fifty-one percent (51%) of the
Voting Rights may at any time remove the Trustee or the Securities Administrator
and appoint a successor trustee or successor securities administrator by written
instrument or instruments, in triplicate, signed by such Holders or their
attorneys-in-fact duly authorized, one complete set of which instruments shall
be delivered to the Depositor, one complete set to the Trustee or the Securities
Administrator so removed and one complete set to the successor so appointed.
A
copy of such instrument shall be delivered to the Certificateholders, the
Trustee (in the case of the removal of the Securities Administrator), the
Securities Administrator (in the case of the removal of the Trustee) and the
Master Servicer by the Depositor.
Any
resignation or removal of the Trustee or the Securities Administrator and
appointment of a successor trustee or successor securities administrator
pursuant to any of the provisions of this Section shall not become
effective until acceptance of appointment by the successor trustee or successor
securities administrator, as applicable, as provided in
Section 9.08.
Notwithstanding
anything to the contrary contained herein, the Master Servicer and the
Securities Administrator shall at all times be the same Person.
Section
9.08 Successor
Trustee or Securities Administrator.
Any
successor trustee or successor securities administrator appointed as provided
in
Section 9.07 hereof shall execute, acknowledge and deliver to the Depositor
and to its predecessor trustee or predecessor securities administrator
instrument accepting such appointment hereunder and thereupon the resignation
or
removal of the predecessor trustee or predecessor securities administrator
shall
become effective and such successor trustee or successor securities
administrator, without any further act, deed or conveyance, shall become fully
vested with all the rights, powers, duties and obligations of its predecessor
hereunder, with the like effect as if originally named as trustee or securities
administrator herein. The predecessor trustee or predecessor securities
administrator shall deliver to the successor trustee or successor securities
administrator all Mortgage Loan Documents and related documents and statements
to the extent held by it hereunder, as well as all monies, held by it hereunder,
and the Depositor and the predecessor trustee or predecessor securities
administrator shall execute and deliver such instruments and do such other
things as may reasonably be required for more fully and certainly vesting and
confirming in the successor trustee or successor securities administrator all
such rights, powers, duties and obligations.
No
successor trustee or successor securities administrator shall accept appointment
as provided in this Section 9.08 unless at the time of such acceptance such
successor trustee or successor securities administrator shall be eligible under
the provisions of Section 9.07 hereof and its appointment shall not
adversely affect the then current rating of the Certificates.
Upon
acceptance of appointment by a successor trustee or successor securities
administrator as provided in this Section 9.08, the successor trustee or
successor securities administrator shall mail notice of the succession of such
trustee or securities administrator hereunder to all Holders of Certificates.
If
the successor trustee or successor securities administrator fails to mail such
notice within ten days after acceptance of appointment, the Depositor shall
cause such notice to be mailed at the expense of the Trust Fund.
Section
9.09 Merger
or Consolidation of Trustee or Securities Administrator.
Any
corporation, state bank or national banking association into which the Trustee
or Securities Administrator may be merged or converted or with which it may
be
consolidated or any corporation, state bank or national banking association
resulting from any merger, conversion or consolidation to which the Trustee
or
the Securities Administrator shall be a party, or any corporation, state bank
or
national banking association succeeding to substantially all of the corporate
trust business of the Trustee or Securities Administrator or shall be the
successor of the Trustee or Securities Administrator hereunder, provided that
such corporation shall be eligible under the provisions of Section 9.06
without the execution or filing of any paper or further act on the part of
any
of the parties hereto, anything herein to the contrary
notwithstanding.
Section
9.10 Appointment
of Co-Trustee or Separate Trustee.
Notwithstanding
any other provisions hereof, at any time, for the purpose of meeting any legal
requirements of any jurisdiction in which any part of REMIC I or any property
securing the same may at the time be located, the Trustee shall have the power
and shall execute and deliver all instruments to appoint one or more Persons
approved by the Trustee to act as co-trustee or co-trustees, jointly with the
Trustee, or separate trustee or separate trustees, of all or any part of REMIC
I, and to vest in such Person or Persons, in such capacity, and for the benefit
of the Holders of the Certificates, such title to REMIC I, or any part thereof,
and, subject to the other provisions of this Section 9.10, such powers,
duties, obligations, rights and trusts as the Trustee may consider necessary
or
desirable. No co-trustee or separate trustee hereunder shall be required to
meet
the terms of eligibility as a successor trustee under Section 9.06
hereunder and no notice to Holders of Certificates of the appointment of
co-trustee(s) or separate trustee(s) shall be required under Section 9.08
hereof.
In
the
case of any appointment of a co-trustee or separate trustee pursuant to this
Section 9.10 all rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred or imposed upon and exercised or
performed by the Trustee and such separate trustee or co-trustee jointly, except
to the extent that under any law of any jurisdiction in which any particular
act
or acts are to be performed by the Trustee (whether as Trustee hereunder or
as
successor to a defaulting Master Servicer hereunder), the Trustee shall be
incompetent or unqualified to perform such act or acts, in which event such
rights, powers, duties and obligations (including the holding of title to REMIC
I or any portion thereof in any such jurisdiction) shall be exercised and
performed by such separate trustee or co-trustee at the direction of the
Trustee.
Any
notice, request or other writing given to the Trustee shall be deemed to have
been given to each of the then separate trustees and co-trustees, as effectively
as if given to each of them. Every instrument appointing any separate trustee
or
co-trustee shall refer to this Agreement and the conditions of this Article
IX.
Each separate trustee and co-trustee, upon its acceptance of the trust
conferred, shall be vested with the estates or property specified in its
instrument of appointment, either jointly with the Trustee, or separately,
as
may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee.
Any
separate trustee or co-trustee may, at any time, constitute the Trustee, its
agent or attorney-in-fact, with full power and authority, to the extent not
prohibited by law, to do any lawful act under or in respect of this Agreement
on
its behalf and in its name. If any separate trustee or co-trustee shall die,
become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee or co-trustee.
Section
9.11 Appointment
of Office or Agency.
The
Certificates may be surrendered for registration of transfer or exchange at
the
Securities Administrator’s office initially located at Xxxxx Xxxxxx xxx
Xxxxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000, and presented for final
distribution at the Corporate Trust Office of the Securities Administrator
where
notices and demands to or upon the Securities Administrator in respect of the
Certificates and this Agreement may be served.
Section
9.12 Representations
and Warranties.
The
Trustee hereby represents and warrants to the Master Servicer, the Securities
Administrator, the related Servicer and the Depositor as applicable, as of
the
Closing Date, that:
(i) It
is a
national banking association duly organized, validly existing and in good
standing under the laws of the United States of America.
(ii) The
execution and delivery of this Agreement by it, and the performance and
compliance with the terms of this Agreement by it, will not violate its articles
of association or bylaws or constitute a default (or an event which, with notice
or lapse of time, or both, would constitute a default) under, or result in
the
breach of, any material agreement or other instrument to which it is a party
or
which is applicable to it or any of its assets.
(iii) It
has
the full power and authority to enter into and consummate all transactions
contemplated by this Agreement, has duly authorized the execution, delivery
and
performance of this Agreement, and has duly executed and delivered this
Agreement.
(iv) This
Agreement, assuming due authorization, execution and delivery by the other
parties hereto, constitutes a valid, legal and binding obligation of it,
enforceable against it in accordance with the terms hereof, subject to (A)
applicable bankruptcy, insolvency, receivership, reorganization, moratorium
and
other laws affecting the enforcement of creditors’ rights generally, and (B)
general principles of equity, regardless of whether such enforcement is
considered in a proceeding in equity or at law.
(v) It
is not
in violation of, and its execution and delivery of this Agreement and its
performance and compliance with the terms of this Agreement will not constitute
a violation of, any law, any order or decree of any court or arbiter, or any
order, regulation or demand of any federal, state or local governmental or
regulatory authority, which violation, in its good faith and reasonable
judgment, is likely to affect materially and adversely either the ability of
it
to perform its obligations under this Agreement or its financial
condition.
No
litigation is pending or, to the best of its knowledge, threatened against
it,
which would prohibit it from entering into this Agreement or, in its good faith
reasonable judgment, is likely to materially and adversely affect either the
ability of it to perform its obligations under this Agreement or its financial
condition.
Section
9.13 Tax
Matters.
It
is
intended that the Trust Fund shall constitute, and that the affairs of the
Trust
Fund shall be conducted so that each REMIC formed hereunder qualifies as, a
“real estate mortgage investment conduit” as defined in and in accordance with
the REMIC Provisions. In furtherance of such intention, the Securities
Administrator covenants and agrees that it shall act as agent (and the
Securities Administrator is hereby appointed to act as agent) on behalf of
the
Trust Fund. The Securities Administrator, as agent on behalf of the Trust Fund,
shall do or refrain from doing, as applicable, the following: (a) the Securities
Administrator shall prepare and file, or cause to be prepared and filed, in
a
timely manner, U.S. Real Estate Mortgage Investment Conduit Income Tax Returns
(Form 1066 or any successor form adopted by the Internal Revenue Service) and
prepare and file or cause to be prepared and filed with the Internal Revenue
Service and applicable state or local tax authorities income tax or information
returns for each taxable year with respect to each such REMIC containing such
information and at the times and in the manner as may be required by the Code
or
state or local tax laws, regulations, or rules, and furnish or cause to be
furnished to Certificateholders the schedules, statements or information at
such
times and in such manner as may be required thereby; (b) the Securities
Administrator shall apply for an employer identification number with the
Internal Revenue Service via a Form SS-4 or other comparable method for each
REMIC that is or becomes a taxable entity, and within thirty days of the Closing
Date, furnish or cause to be furnished to the Internal Revenue Service, on
Forms
8811 or as otherwise may be required by the Code, the name, title, address,
and
telephone number of the person that the holders of the Certificates may contact
for tax information relating thereto, together with such additional information
as may be required by such Form, and update such information at the time or
times in the manner required by the Code for the Trust Fund; (c) the Securities
Administrator shall make or cause to be made elections, on behalf of each REMIC
formed hereunder to be treated as a REMIC on the federal tax return of such
REMIC for its first taxable year (and, if necessary, under applicable state
law); (d) the Securities Administrator shall prepare and forward, or cause
to be
prepared and forwarded, to the Certificateholders and to the Internal Revenue
Service and, if necessary, state tax authorities, all information returns and
reports as and when required to be provided to them in accordance with the
REMIC
Provisions, including without limitation, the calculation of any original issue
discount using the Prepayment Assumption; (e) the Securities Administrator
shall
provide information necessary for the computation of tax imposed on the transfer
of a Residual Certificate to a Person that is not a Permitted Transferee, or
an
agent (including a broker, nominee or other middleman) of a Person that is
not a
Permitted Transferee, or a pass-through entity in which a Person that is not
a
Permitted Transferee is the record holder of an interest (the reasonable cost
of
computing and furnishing such information may be charged to the Person liable
for such tax); (f) the Securities Administrator shall, to the extent under
its
control, conduct the affairs of the Trust Fund at all times that any
Certificates are outstanding so as to maintain the status of each REMIC formed
hereunder as a REMIC under the REMIC Provisions; (g) the Securities
Administrator shall not knowingly or intentionally take any action or omit
to
take any action that would cause the termination of the REMIC status of any
REMIC formed hereunder; (h) the Securities Administrator shall pay, from the
sources specified in the last paragraph of this Section 9.12, the amount of
any federal, state and local taxes, including prohibited transaction taxes
as
described below, imposed on any REMIC formed hereunder prior to the termination
of the Trust Fund when and as the same shall be due and payable (but such
obligation shall not prevent the Securities Administrator or any other
appropriate Person from contesting any such tax in appropriate proceedings
and
shall not prevent the Securities Administrator from withholding payment of
such
tax, if permitted by law, pending the outcome of such proceedings); (i) the
Trustee shall sign or cause to be signed federal, state or local income tax
or
information returns or any other document prepared by the Securities
Administrator pursuant to this Section 9.13 requiring a signature thereon
by the Trustee; (j) the Securities Administrator shall maintain records relating
to each REMIC formed hereunder including but not limited to the income,
expenses, assets and liabilities of each such REMIC and adjusted basis of the
Trust Fund property determined at such intervals as may be required by the
Code,
as may be necessary to prepare the foregoing returns, schedules, statements
or
information; (k) the Securities Administrator shall, for federal income tax
purposes, maintain books and records with respect to the REMICs on a calendar
year and on an accrual basis; (l) the Securities Administrator shall not enter
into any arrangement not otherwise provided for in this Agreement by which
the
REMICs will receive a fee or other compensation for services nor permit the
REMICs to receive any income from assets other than “qualified mortgages” as
defined in Section 860G(a)(3) of the Code or “permitted investments” as
defined in Section 860G(a)(5) of the Code; and (m) as and when necessary
and appropriate, the Securities Administrator shall represent the Trust Fund
in
any administrative or judicial proceedings relating to an examination or audit
by any governmental taxing authority, request an administrative adjustment
as to
any taxable year of any REMIC formed hereunder, enter into settlement agreements
with any governmental taxing agency, extend any statute of limitations relating
to any tax item of the Trust Fund, and otherwise act on behalf of each REMIC
formed hereunder in relation to any tax matter involving any such
REMIC.
In
order
to enable the Securities Administrator to perform its duties as set forth
herein, the Depositor shall provide, or cause to be provided, to the Securities
Administrator within ten (10) days after the Closing Date all information or
data that the Securities Administrator requests in writing and determines to
be
relevant for tax purposes to the valuations and offering prices of the
Certificates, including, without limitation, the price, yield, prepayment
assumption and projected cash flows of the Certificates and the Mortgage Loans.
Thereafter, the Depositor shall provide to the Securities Administrator promptly
upon written request therefor, any such additional information or data that
the
Securities Administrator may, from time to time, request in order to enable
the
Securities Administrator to perform its duties as set forth herein. The
Depositor hereby indemnifies the Securities Administrator for any losses,
liabilities, damages, claims or expenses of the Securities Administrator arising
from any errors or miscalculations of the Securities Administrator that result
from any failure of the Depositor to provide, or to cause to be provided,
accurate information or data to the Securities Administrator on a timely
basis.
In
the
event that any tax is imposed on “prohibited transactions” of any REMIC as
defined in Section 860F(a)(2) of the Code, on the “net income from
foreclosure property” of the Trust Fund as defined in Section 860G(c) of
the Code, on any contribution to any REMIC after the startup day pursuant to
Section 860G(d) of the Code, or any other tax is imposed, including,
without limitation, any federal, state or local tax or minimum tax imposed
upon
any of REMIC, and is not paid as otherwise provided for herein, such tax shall
be paid by (i) the Securities Administrator, if any such other tax arises out
of
or results from a breach by the Securities Administrator of any of its
obligations under this Section, (ii) any party hereto (other than the Securities
Administrator) to the extent any such other tax arises out of or results from
a
breach by such other party of any of its obligations under this Agreement or
(iii) in all other cases, or in the event that any liable party hereto fails
to
honor its obligations under the preceding clauses (i) or (ii), any such tax
with
respect to REMIC I will be paid first with amounts otherwise to be distributed
to the Class R Certificates and second with amounts otherwise to be distributed
to all other Certificateholders in the following order of priority: first,
to
the Class M-5 Certificates, second, to the Class M-4 Certificates, third, to
the
Class M-3 Certificates, fourth, to the Class M-2 Certificates, fifth, to the
Class M-1 Certificates and sixth, to the Senior Certificates (pro rata based
on
the amounts to be distributed). Notwithstanding anything to the contrary
contained herein, to the extent that such tax is payable by the Holder of any
Certificates, the Securities Administrator is hereby authorized to retain on
any
Distribution Date, from the Holders of the related Residual Certificates (and,
if necessary, second, from the Holders of the other related Certificates in
the
priority specified in the preceding sentence), funds otherwise distributable
to
such Holders in an amount sufficient to pay such tax. The Securities
Administrator shall include in its monthly report to Certificateholders
distributions to such parties taking into account the priorities described
in
the second preceding sentence. The Securities Administrator agrees to promptly
notify in writing the party liable for any such tax of the amount thereof and
the due date for the payment thereof. Notwithstanding the foregoing, however,
in
no event shall the Securities Administrator have any liability (1) for any
action or omission that is taken in accordance with and in compliance with
the
express terms of, or which is expressly permitted by the terms of this
Agreement, (2) for any losses other than arising out of a grossly negligent
performance by the Securities Administrator of its duties and obligations set
forth herein, and (3) for any special or consequential damages to
Certificateholders (in addition to payment of principal and interest on the
Certificates).
ARTICLE
X
TERMINATION
Section
10.01 Termination
Upon Liquidation or Repurchase of all Mortgage Loans.
Subject
to Section 10.03, the obligations and responsibilities of the Depositor,
the Sponsor, the Securities Administrator, the Master Servicer and the Trustee
created hereby with respect to the Trust Fund shall terminate (other than the
obligations of the Master Servicer to the Trustee pursuant to Section 9.05
and of the Securities Administrator to make payments in respect of the REMIC
I
Regular Interests, the REMIC II Regular Interests, REMIC III Regular Interests
or the Certificates as hereinafter set forth) upon the earlier of (a) the Master
Servicer’s exercise of its optional right to purchase the Mortgage Loans and
related REO Properties (the “Clean-up Call”) and (b) the later of (i) the
maturity or other liquidation (or any Advance with respect thereto) of the
last
Mortgage Loan remaining in the Trust Fund and the disposition of all related
REO
Property and (ii) the distribution to the Certificateholders of all amounts
required to be distributed to them pursuant to this Agreement. In no event
shall
the trusts created hereby continue beyond the earlier of (i) the expiration
of
twenty-one (21) years from the death of the last survivor of the descendants
of
Xxxxxx X. Xxxxxxx, the late Ambassador of the United States to the Court of
St.
Xxxxx, living on the date hereof and (ii) the Latest Possible Maturity
Date.
The
Cleanup Call shall be exercisable at a price (the “Termination Price”) equal to
the sum of (i) 100% of the Stated Principal Balance of the Mortgage Loans (ii)
accrued interest thereon at the applicable Mortgage Rate to, but not including,
the first day of the month of such purchase, (iii) the appraised value of any
related REO Property (up to the Stated Principal Balance of the related Mortgage
Loan), such appraisal to be conducted by an appraiser selected in good faith
by
the Master Servicer, (iv) unreimbursed out-of-pocket costs of the Securities
Administrator, the Master Servicer, the Servicers or the Trustee, including
unreimbursed servicing advances and the principal portion of any unreimbursed
Advances, made on the related Mortgage Loans prior to the exercise of such
repurchase right; (v) any Swap Termination Payment payable to the Swap Provider
which remains unpaid or which is due to the Cleanup Call and (vi) any other
amounts due and owing to the Trustee, the Securities Administrator, the Master
Servicer and the Custodian payable pursuant to this Agreement or the Custodial
Agreement.
The
right
to exercise the Cleanup Call pursuant to the preceding paragraph shall be
exercisable if the Stated Principal Balance of all of the Mortgage Loans at
the
time of any such repurchase, is less than or equal to ten percent (10%) of
the
aggregate Cut-off Date Principal Balance of the Mortgage Loans.
Section
10.02 Final
Distribution on the Certificates.
If
on any
Determination Date, (i) the Securities Administrator determines based on the
reports delivered by the Master Servicer under this Agreement that there are
no
Outstanding Mortgage Loans and no other funds or assets in the Trust Fund other
than the funds in the Distribution Account, the Securities Administrator shall
notify the Trustee and send a final distribution notice promptly to each related
Certificateholder or (ii) the Securities Administrator determines that a Class
of Certificates shall be retired after a final distribution on such Class,
the
Securities Administrator shall notify the Trustee and the Certificateholders
within five (5) Business Days after such Determination Date that the final
distribution in retirement of such Class of Certificates is scheduled to be
made
on the immediately following Distribution Date. Any final distribution made
pursuant to the immediately preceding sentence will be made only upon
presentation and surrender of the Certificates at the office of the Securities
Administrator set forth herein. If the Master Servicer elects to exercise the
Cleanup Call pursuant to Section 10.01, at least twenty (20) days prior to
the date notice is to be mailed to the related Certificateholders, the Master
Servicer shall notify the Securities Administrator and the Trustee of the date
the Master Servicer intends to exercise the Cleanup Call. The Master Servicer
shall remit the Termination Price to the Securities Administrator on behalf
of
the related REMIC on the Business Day prior to the Distribution Date for such
Optional Termination by the Master Servicer.
Notice
of
the exercise of the Cleanup Call specifying the Distribution Date on which
the
Certificateholders may surrender their Certificates for payment of the final
distribution and cancellation, shall be given promptly by the Securities
Administrator by letter to the Certificateholders mailed no later than the
fifteenth (15th) day of the month of such final distribution. Any such notice
shall specify (a) the Distribution Date upon which final distribution on the
Certificates will be made upon presentation and surrender of such Certificates
at the office therein designated, (b) the amount of such final distribution,
(c)
the location of the office or agency at which such presentation and surrender
must be made and (d) that the Record Date otherwise applicable to such
Distribution Date is not applicable, distributions being made only upon
presentation and surrender of the Certificates at the office therein specified.
The Securities Administrator will give such notice to each Rating Agency at
the
time such notice is given to the Certificateholders.
In
the
event such notice is given, the Master Servicer shall deposit in the
Distribution Account on the Business Day prior to the applicable Distribution
Date in an amount equal to the final distribution in respect of the
Certificates. Upon certification to the Trustee by the Securities Administrator
of the making of such final deposit, the Trustee shall promptly release or
cause
to be released to the Master Servicer the Mortgage Files for the remaining
Mortgage Loans in the Trust Fund, and the Trustee shall execute all assignments,
endorsements and other instruments delivered to it and necessary to effectuate
such transfer.
Upon
presentation and surrender of the Certificates, the Securities Administrator
shall cause to be distributed to Certificateholders of each such Class the
amounts allocable to such Certificates held in the Distribution Account in
the
order and priority set forth in Section 5.04 hereof on the final
Distribution Date and in proportion to their respective Percentage
Interests.
In
the
event that any Certificateholders shall not surrender Certificates for
cancellation within six (6) months after the date specified in the above
mentioned written notice, the Securities Administrator shall give a second
written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within six (6) months after the second notice all the Certificates
shall not have been surrendered for cancellation, the Securities Administrator
may take appropriate steps, or may appoint an agent to take appropriate steps,
to contact the remaining Certificateholders concerning surrender of their
Certificates, and the cost thereof shall be paid out of the funds and other
assets that remain a part of the Trust Fund. If within two (2) years after
the
second notice all Certificates shall not have been surrendered for cancellation,
the Residual Certificateholders shall be entitled to all unclaimed funds and
other assets of the Trust Fund that remain subject hereto and the Securities
Administrator shall release such funds upon written direction.
Section
10.03 Additional
Termination Requirements.
In
the
event of (i) the exercise by the Master Servicer of the Cleanup Call pursuant
to
the terms of this Agreement, or (ii) the final payment on or other liquidation
of the last Mortgage Loan or related REO Property in REMIC I pursuant to
Section 10.01, the following additional requirements, unless the Trustee
has been supplied with an Opinion of Counsel, at the expense of the Master
Servicer (in the case of the exercise of the Cleanup Call) or the Depositor,
to
the effect that the failure of the Trust Fund to comply with the requirements
of
this Section 10.03 will not (i) result in the imposition of taxes on
“prohibited transactions” of a REMIC, or (ii) cause any REMIC to fail to qualify
as a REMIC at any time that the Certificates are outstanding:
(1) |
The
Master Servicer (in the case of the exercise of the Cleanup Call)
or the
Depositor (in all other cases) shall establish a ninety-day liquidation
period and notify the Securities Administrator thereof, and the Securities
Administrator shall in turn specify the first day of such period
in a
statement attached to the tax return for each of REMIC I, REMIC II,
REMIC
III, REMIC IV, REMIC V, REMIC VI, pursuant to Treasury Regulation
Section 1.860F-1. The Master Servicer or the Depositor, as
applicable, shall satisfy all the requirements of a qualified liquidation
under Section 860F of the Code and any regulations thereunder, as
evidenced by an Opinion of Counsel obtained at the expense of the
Master
Servicer or the Depositor, as
applicable;
|
(2) |
During
such ninety-day liquidation period, and at or prior to the time of
making
the final payment on the Certificates, the Master Servicer (in the
case of
the exercise of the Cleanup Call) or the Depositor (in all other
cases)
shall sell all of the assets of REMIC I for cash;
and
|
(3) |
At
the time of the making of the final payment on the Certificates,
the
Trustee shall distribute or credit, or cause to be distributed or
credited, to the Holders of the Residual Certificates all cash on
hand in
the Trust Fund (other than cash retained to meet claims), and the
Trust
Fund shall terminate at that time.
|
By
their
acceptance of the Certificates, the Holders thereof hereby authorize the Master
Servicer (in the case of the exercise of the Cleanup Call) or the Depositor
(in
all other cases) to specify the ninety-day liquidation period for REMIC I,
REMIC
II, REMIC III, REMIC IV, REMIC V and REMIC VI as applicable, which authorization
shall be binding upon all successor Certificateholders.
The
Securities Administrator as agent for each REMIC hereby agrees to adopt and
sign
such a plan of complete liquidation upon the written request of the Master
Servicer or the Depositor, as applicable, and the receipt of the Opinion of
Counsel referred to in Section 10.03(1) and to take such other action in
connection therewith as may be reasonably requested by the Master Servicer
or
the Depositor, as applicable.
ARTICLE
XI
MISCELLANEOUS
PROVISIONS
Section
11.01 Amendment.
This
Agreement may be amended from time to time by parties hereto, without the
consent of any of the Certificateholders to cure any ambiguity, to correct
or
supplement any provisions herein, to change the manner in which the Distribution
Account maintained by the Securities Administrator or the Custodial Accounts
maintained by the Servicers is maintained or to make such other provisions
with
respect to matters or questions arising under this Agreement as shall not be
inconsistent with any other provisions herein if such action shall not, as
evidenced by an Opinion of Counsel, adversely affect in any material respect
the
interests of any Certificateholder (or the Swap Provider unless the Swap
Provider shall have consented to the amendment, which consent shall not be
unreasonably withheld); provided that any such amendment shall be deemed not
to
adversely affect in any material respect the interests of the Certificateholders
and no such Opinion of Counsel shall be required if the Person requesting such
amendment obtains a letter from each Rating Agency stating that such amendment
would not result in the downgrading or withdrawal of the respective ratings
then
assigned to the Certificates; provided further that any such amendment shall
be
deemed not to adversely affect in any material respect the interests of the
Certificateholders and no such Opinion of Counsel nor any letter from the Rating
Agencies stating that such amendment would not result in the downgrading or
withdrawal of the respective ratings then assigned to the Certificates shall
be
required if such amendment is to effect a transfer of servicing pursuant to
Section 7.06(a) to a Successor Servicer satisfying the Minimum Servicing
Requirements.
Notwithstanding
the foregoing, without the consent of the Certificateholders or the Swap
Provider, the parties hereto may at any time and from time to time amend this
Agreement to modify, eliminate or add to any of its provisions to such extent
as
shall be necessary or appropriate to maintain the qualification of each REMIC
as
a REMIC under the Code or to avoid or minimize the risk of the imposition of
any
tax on any REMIC pursuant to the Code that would be a claim against any REMIC
at
any time prior to the final redemption of the Certificates, provided that the
Trustee has been provided an Opinion of Counsel, which opinion shall be an
expense of the party requesting such opinion but in any case shall not be an
expense of the Trustee or the Trust Fund, to the effect that such action is
necessary or appropriate to maintain such qualification or to avoid or minimize
the risk of the imposition of such a tax.
This
Agreement may also be amended from time to time by the parties hereto and the
Holders of each Class of Certificates affected thereby evidencing over 50%
of
the Voting Rights of such Class or Classes for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions
of
this Agreement or of modifying in any manner the rights of the Holders of
Certificates (or, if such amendment modifies the rights of the Swap Provider
hereunder, with the consent of the Swap Provider, which consent shall not be
unreasonably withheld); provided that no such amendment shall (i) reduce in
any
manner the amount of, or delay the timing of, payments required to be
distributed on any Certificate without the consent of the Holder of such
Certificate, (ii) cause any REMIC to cease to qualify as a REMIC or (iii) reduce
the aforesaid percentages of Certificates of each Class the Holders of which
are
required to consent to any such amendment without the consent of the Holders
of
all Certificates of such Class then outstanding.
Notwithstanding
any contrary provision of this Agreement, the Trustee shall not consent to
any
amendment to this Agreement unless it shall have first received an Opinion
of
Counsel, which opinion shall be an expense of the party requesting such
amendment but in any case shall not be an expense of the Trustee, to the effect
that such amendment will not (other than an amendment pursuant to clause (ii)
of, and in accordance with, the preceding paragraph) cause the imposition of
any
tax on any REMIC or the Certificateholders or cause any REMIC to cease to
qualify as a REMIC at any time that any Certificates are outstanding. Further,
nothing in this Agreement shall require the Trustee to enter into an amendment
without receiving an Opinion of Counsel, satisfactory to the Trustee that (i)
such amendment is permitted and is not prohibited by this Agreement and (ii)
that all requirements for amending this Agreement (including any consent of
the
applicable Certificateholders) have been complied with.
Promptly
after the execution of any amendment to this Agreement requiring the consent
of
Certificateholders, the Trustee shall furnish written notification of the
substance of such amendment to each Certificateholder and each Rating
Agency.
It
shall
not be necessary for the consent of Certificateholders under this
Section to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Certificateholders shall be subject to such reasonable
regulations as the Trustee may prescribe.
The
Trustee may, but shall not be obligated to enter into any amendment that affects
its rights, duties or immunities under this Agreement or otherwise.
Section
11.02 Recordation
of Agreement; Counterparts.
To
the
extent permitted by applicable law, this Agreement is subject to recordation
in
all appropriate public offices for real property records in all of the counties
or other comparable jurisdictions in which any or all of the Mortgaged
Properties are situated, and in any other appropriate public recording office
or
elsewhere. The Sponsor or the Depositor shall effect such recordation at the
Trust’s expense upon the request in writing of a Certificateholder, but only if
such direction is accompanied by an Opinion of Counsel (provided at the expense
of the Certificateholder requesting recordation) to the effect that such
recordation would materially and beneficially affect the interests of the
Certificateholders or is required by law.
For
the
purpose of facilitating the recordation of this Agreement as herein provided
and
for other purposes, this Agreement may be executed simultaneously in any number
of counterparts, each of which counterparts shall be deemed to be an original,
and such counterparts shall constitute but one and the same
instrument.
Section
11.03 Governing
Law.
THIS
AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE SUBSTANTIVE
LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED
IN THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HERETO AND THE CERTIFICATEHOLDERS SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS WITHOUT REGARD TO THE CONFLICTS OF LAWS PRINCIPLES THEREOF OTHER THAN
THE
PROVISIONS OF SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS
LAW.
Section
11.04 Intention
of Parties.
It
is the
express intent of the parties hereto that the conveyance of the Mortgage Notes,
Mortgages, assignments of Mortgages, title insurance policies and any
modifications, extensions and/or assumption agreements and private mortgage
insurance policies relating to the Mortgage Loans by the Sponsor to the
Depositor, and by the Depositor to the Trust Fund be, and be construed as,
an
absolute sale thereof to the Depositor or the Trust Fund, as applicable. It
is,
further, not the intention of the parties that such conveyance be deemed a
pledge thereof by the Sponsor to the Depositor, or by the Depositor to the
Trust
Fund. However, in the event that, notwithstanding the intent of the parties,
such assets are held to be the property of the Sponsor or the Depositor, as
applicable, or if for any other reason this Agreement is held or deemed to
create a security interest in such assets, then (i) this Agreement shall be
deemed to be a security agreement within the meaning of the Uniform Commercial
Code of the State of New York and (ii) each conveyance provided for in this
Agreement shall be deemed to be an assignment and a grant by the Sponsor or
the
Depositor, as applicable, for the benefit of the Certificateholders, of a
security interest in all of the assets that constitute the Trust Fund, whether
now owned or hereafter acquired.
The
Depositor for the benefit of the Certificateholders shall, to the extent
consistent with this Agreement, take such actions as may be necessary to ensure
that, if this Agreement were deemed to create a security interest in the assets
of the Trust Fund, such security interest would be deemed to be a perfected
security interest of first priority under applicable law and will be maintained
as such throughout the term of the Agreement.
Section
11.05 Notices.
The
Securities Administrator shall use its best efforts to promptly provide notice
to each Rating Agency with respect to each of the following of which it has
actual knowledge:
(1) |
Any
material change or amendment to this
Agreement;
|
(2) |
The
occurrence of any Servicer Default or Master Servicer Default that
has not
been cured;
|
(3) |
The
resignation or termination of a Servicer, the Master Servicer or
the
Trustee and the appointment of any successor;
and
|
(4) |
The
final payment to
Certificateholders.
|
In
addition, the Securities Administrator shall, upon request, promptly furnish
to
each Rating Agency copies of the following:
(1) |
Each
Annual Statement of Compliance described in Section 3.13 of this
Agreement; and
|
(2) |
Each
Assessment of Compliance and Attestation Report described in
Section 3.14.
|
All
directions, demands and notices hereunder shall be in writing and shall be
deemed to have been duly given when delivered at or mailed by registered mail,
return receipt requested, postage prepaid, or by recognized overnight courier,
or by facsimile transmission to a number provided by the appropriate party
if
receipt of such transmission is confirmed to (i) in the case of the Depositor,
Nomura Asset Acceptance Corp., 2 World Xxxxxxxxx Xxxxxx, Xxxxxxxx X, Xxx Xxxx,
Xxx Xxxx 00000 Attention: Nomura Asset Acceptance Corporation, Alternative
Loan
Trust, Series 2006-AR3; (ii) in the case of the Sponsor, Nomura Credit &
Capital, Inc., 2 World Xxxxxxxxx Xxxxxx, Xxxxxxxx X, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Nomura Asset Acceptance Corporation, Alternative Loan Trust, Series
2006-AR3 or such other address as may be hereafter furnished to the other
parties hereto by the Sponsor in writing; (iii) in the case of the GMACM, GMAC
Mortgage Corporation, 000 Xxxxxxxxxx Xxxx Xxxxxxx, Xxxxxxxxxxxx 00000,
Attention: Xxx Xxxxxxx; (iv) in the case of Xxxxx Fargo, Xxxxx Fargo Bank,
N.A.,
X.X. Xxx 00, Xxxxxxxx, Xxxxxxxx 00000 (or, for overnight deliveries, 0000 Xxx
Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000), Telecopy No.: (000) 000-0000, Attn:
NAAC 2006-AR3; (v) in the case of the Trustee, at each Corporate Trust Office
or
such other address as the Trustee may hereafter furnish to the other parties
hereto; (vi) in the case of the Custodian, Xxxxx Fargo Bank, N.A., 00 Xxxxxxxxx
Xxxx, Xxxxx 000, Xxxxxx, Xxxxxxxxxx 00000, (vii) in the case of the Securities
Administrator, its Corporate Trust Office; (viii) in the case of the Master
Servicer, X.X. Xxx 00, Xxxxxxxx, Xxxxxxxx 00000 (or for overnight deliveries,
0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000, Attention Client Manager
-
NAAC 2006-AR3); and (ix) in the case of the Rating Agencies, (a) Standard &
Poor’s, 00 Xxxxx Xxxxxx, 00xx
Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Mortgage Surveillance Group and (b) Xxxxx’x
Investors Service, Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Home Equity Monitoring. Any notice delivered to the Sponsor or the Trustee
under
this Agreement shall be effective only upon receipt. Any notice required or
permitted to be mailed to a Certificateholder, unless otherwise provided herein,
shall be given by first-class mail, postage prepaid, at the address of such
Certificateholder as shown in the Certificate Register; any notice so mailed
within the time prescribed in this Agreement shall be conclusively presumed
to
have been duly given, whether or not the Certificateholder receives such
notice.
Section
11.06 Severability
of Provisions.
If
any
one or more of the covenants, agreements, provisions or terms of this Agreement
shall be for any reason whatsoever held invalid, then such covenants,
agreements, provisions or terms shall be deemed severable from the remaining
covenants, agreements, provisions or terms of this Agreement and shall in no
way
affect the validity or enforceability of the other provisions of this Agreement
or of the Certificates or the rights of the Holders thereof.
Section
11.07 Assignment.
Notwithstanding
anything to the contrary contained herein, except as provided pursuant to
Section 7.02, this Agreement may not be assigned by the Sponsor or the
Depositor.
Section
11.08 Limitation
on Rights of Certificateholders.
The
death
or incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust Fund, nor entitle such Certificateholder’s legal
representative or heirs to claim an accounting or to take any action or commence
any proceeding in any court for a petition or winding up of the Trust Fund,
or
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
No
Certificateholder shall have any right to vote (except as provided herein)
or in
any manner otherwise control the operation and management of the Trust Fund,
or
the obligations of the parties hereto, nor shall anything herein set forth
or
contained in the terms of the Certificates be construed so as to constitute
the
Certificateholders from time to time as partners or members of an association;
nor shall any Certificateholder be under any liability to any third party by
reason of any action taken by the parties to this Agreement pursuant to any
provision hereof.
No
Certificateholder shall have any right by virtue or by availing itself of any
provisions of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Holder previously shall have given to the Trustee, a written notice of a
Servicer Default and of the continuance thereof, as hereinbefore provided,
the
Holders of Certificates evidencing not less than twenty-five percent (25%)
of
the Voting Rights evidenced by the Certificates shall also have made written
request to the Trustee to institute such action, suit or proceeding in its
own
name as Trustee, hereunder and shall have offered to the Trustee such indemnity
satisfactory to it as it may require against the costs, expenses, and
liabilities to be incurred therein or thereby, and the Trustee or for sixty
(60)
days after its receipt of such notice, request and offer of indemnity shall
have
neglected or refused to institute any such action, suit or proceeding; it being
understood and intended, and being expressly covenanted by each
Certificateholder with every other Certificateholder and the Trustee, that
no
one or more Holders of Certificates shall have any right in any manner whatever
by virtue or by availing itself or themselves of any provisions of this
Agreement to affect, disturb or prejudice the rights of the Holders of any
other
of the Certificates, or to obtain or seek to obtain priority over or preference
to any other such Holder or to enforce any right under this Agreement, except
in
the manner herein provided and for the common benefit of all Certificateholders.
For the protection and enforcement of the provisions of this Section 11.08,
each and every Certificateholder or the Trustee shall be entitled to such relief
as can be given either at law or in equity.
Section
11.09 Certificates
Nonassessable and Fully Paid.
It
is the
intention of the Depositor that Certificateholders shall not be personally
liable for obligations of the Trust Fund, that the interests in the Trust Fund
represented by the Certificates shall be nonassessable for any reason
whatsoever, and that the Certificates, upon due authentication thereof by the
Trustee pursuant to this Agreement, are and shall be deemed fully
paid.
Section
11.10 Intention
of the Parties and Interpretation.
Each
of
the parties acknowledges and agrees that the purpose of Sections 3.13, 3.14,
3.18 and 5.17 of this Agreement is to facilitate compliance by the Sponsor
and
the Depositor with the provisions of Regulation AB promulgated by the SEC under
the Exchange Act (17 C.F.R. §§ 229.1100 - 229.1123), as such may be amended from
time to time and subject to clarification and interpretive advice as may be
issued by the staff of the SEC from time to time. Therefore, each of the parties
agrees that (a) the obligations of the parties hereunder shall be interpreted
in
such a manner as to accomplish that purpose, (b) the parties’ obligations
hereunder will be supplemented and modified as necessary to be consistent with
any such amendments, interpretive advice or guidance, convention or consensus
among active participants in the asset-backed securities markets, advice of
counsel, or otherwise in respect of the requirements of Regulation AB, (c)
the
parties shall comply with requests made by the Sponsor or the Depositor for
delivery of additional or different information as the Sponsor or the Depositor
may determine in good faith is necessary to comply with the provisions of
Regulation AB and (d) no amendment of this Agreement shall be required to effect
any such changes in the parties’ obligations as are necessary to accommodate
evolving interpretations of the provisions of Regulation AB.
Notwithstanding
the foregoing, the Servicer shall be under no obligation to provide any
information in addition to that required by Sections 3.13, 3.14, 3.18 and 5.17
of this Agreement as of the Closing Date that the Depositor deems required
under
Regulation AB if (i) the Servicer does not believe that such additional
information is required under Regulation AB and (ii) the Servicer is not
providing such additional information for its own securitizations, unless the
Depositor pays all reasonable costs incurred by the Servicer in connection
with
the preparation and delivery of such additional information and the Servicer
is
given reasonable time to establish the necessary systems and procedures to
produce such additional information.
Section
11.11 Reserved.
Section
11.12 Early
Termination of Swap Agreement.
In
the
event that the Swap Agreement is canceled or otherwise terminated for any reason
(other than the exhaustion of the interest rate protection provided thereby),
the Sponsor shall, to the extent a replacement contract is available, direct
the
Trustee to execute a replacement contract comparable to the Swap Agreement,
providing interest rate protection which is equal to the then-existing
protection provided by the Swap Agreement, provided, however, that the cost
of
any such replacement contract providing the same interest rate protection
provided by such replacement contract may be reduced to a level such that the
cost of such replacement contract shall not exceed the amount of any early
termination payment.
IN
WITNESS WHEREOF, the Depositor, the Sponsor, GMACM, the Master Servicer, the
Securities Administrator and the Trustee have caused their names to be signed
hereto by their respective officers thereunto duly authorized as of the day
and
year first above written.
NOMURA
ASSET ACCEPTANCE CORPORATION,
as
Depositor
|
|
By:
|
/s/
Xxxx X. Xxxxxx
|
Name:
|
Xxxx
X. Xxxxxx
|
Title:
|
President
|
NOMURA
CREDIT & CAPITAL, INC.,
as
Sponsor
|
|
By:
|
/s/
Xxxxxxx X.X. Xxxxxxx
|
Name:
|
Xxxxxxx
X.X. Xxxxxxx
|
Title:
|
Vice
President
|
XXXXX
FARGO BANK, NATIONAL ASSOCIATION,
as
Master Servicer and Securities Administrator
|
|
By:
|
/s/
Xxx Xxxxx
|
Name:
|
Xxx
Xxxxx
|
Title:
|
Vice
President
|
HSBC
BANK USA, NATIONAL ASSOCIATION,
as
Trustee
|
|
By:
|
/s/
Xxxxx Xxxxx
|
Name:
|
Xxxxx
Xxxxx
|
Title:
|
Assistant
Vice President
|
GMAC
MORTGAGE CORPORATION,
as
a Servicer
|
|
By:
|
/s/
Xxxxxx X. Xxxxxxx
|
Name:
|
Xxxxxx
X. Xxxxxxx
|
Title:
|
Vice
President
|
With
respect to Sections 3.33 and 3.34
PORTFOLIO
SURVEILLANCE ANALYTICS, LLC
|
|
By:
|
/s/
Xxxxx X. Xxxxx
|
Name:
|
Xxxxx
X. Xxxxx
|
Title:
|
Managing
Partner
|
STATE
OF NEW YORK
|
)
|
)
ss.:
|
|
COUNTY
OF NEW YORK
|
)
|
On
this
___ day of September 2006, before me, a notary public in and for said State,
appeared _____________, personally known to me on the basis of satisfactory
evidence to be an authorized representative of Nomura Asset Acceptance
Corporation, one of the corporations that executed the within instrument, and
also known to me to be the person who executed it on behalf of such corporation
and acknowledged to me that such corporation executed the within
instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
____________________________
|
Notary
Public
|
[Notarial
Seal]
STATE
OF NEW YORK
|
)
|
)
ss.:
|
|
COUNTY
OF NEW YORK
|
)
|
On
this
____ day of September 2006 before me, a notary public in and for said State,
appeared_______________, personally known to me on the basis of satisfactory
evidence to be an authorized representative of Nomura Credit & Capital,
Inc., that executed the within instrument, and also known to me to be the person
who executed it on behalf of such corporation, and acknowledged to me that
such
corporation executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
____________________________
|
Notary
Public
|
[Notarial
Seal]
STATE
OF
|
)
|
)
ss.:
|
|
COUNTY
OF
|
)
|
On
this
____ day of September 2006 before me, a notary public in and for said State,
appeared_______________, personally known to me on the basis of satisfactory
evidence to be an authorized representative of GMAC Mortgage Corporation, that
executed the within instrument, and also known to me to be the person who
executed it on behalf of such corporation, and acknowledged to me that such
corporation executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
____________________________
|
Notary
Public
|
[Notarial
Seal]
STATE
OF
|
)
|
)
ss.:
|
|
COUNTY
|
)
|
On
this
____ day of September 2006, before me, a notary public in and for said State,
appeared _________________, personally known to me on the basis of satisfactory
evidence to be an authorized representative of Portfolio Surveillance Analytics,
LLC, one of the corporations that executed the within instrument, and also
known
to me to be the person who executed it on behalf of such corporation and
acknowledged to me that such corporation executed the within
instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
____________________________
|
Notary
Public
|
[Notarial
Seal]
STATE
OF
|
)
|
)
ss.:
|
|
COUNTY
OF
|
)
|
On
this
____ day of September 2006, before me, a notary public in and for said State,
appeared _______________, personally known to me on the basis of satisfactory
evidence to be an authorized representative of HSBC Bank USA, National
Association that executed the within instrument, and also known to me to be
the
person who executed it on behalf of such corporation, and acknowledged to me
that such corporation executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
____________________________
|
Notary
Public
|
[Notarial
Seal]
STATE
OF
|
)
|
)
ss.:
|
|
COUNTY
OF
|
)
|
On
this
____ day of September 2006, before me, a notary public in and for said State,
appeared _______________, personally known to me on the basis of satisfactory
evidence to be an authorized representative of Xxxxx Fargo Bank, National
Association that executed the within instrument, and also known to me to be
the
person who executed it on behalf of such entity, and acknowledged to me that
such entity executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
____________________________
|
Notary
Public
|
[Notarial
Seal]
EXHIBIT
A-1
FORM
OF CLASS A-[1A][1B][2][3A][3B][4A][4B] CERTIFICATE
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “REGULAR INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986
(THE “CODE”).
THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DECREASED BY PRINCIPAL
PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO. ACCORDINGLY, FOLLOWING
THE
INITIAL ISSUANCE OF THE CERTIFICATES, THE CERTIFICATE PRINCIPAL BALANCE OF
THIS
CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION SHOWN BELOW. ANYONE
ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CERTIFICATE PRINCIPAL BALANCE
BY
INQUIRY OF THE SECURITIES
ADMINISTRATOR
NAMED HEREIN.
UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY TO THE DEPOSITOR OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF
CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON
IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
Certificate
No. [__]
|
Pass-Through
Rate: Floating
|
Class
A-[1A][1B][2][3A][3B][4A][4B]
|
|
Date
of Pooling and Servicing Agreement
and
Cut-off Date: September 1, 2006
|
Aggregate
Initial Certificate Principal Balance of the Class
A-[1A][1B][2][3A][3B][4A][4B] Certificates as of the Cut-off
Date:
$
______________
|
Trustee:
HSBC Bank USA, National Association
|
|
First
Distribution Date: October 25, 2006
|
Initial
Certificate Principal Balance of this Certificate as of the Cut-off
Date:
$
______________
|
Master
Servicer and Securities Administrator: Xxxxx Fargo Bank,
N.A.
|
|
Assumed
Final Distribution Date:
October
25, 2036
|
CUSIP:
[______________]
|
MORTGAGE
PASS-THROUGH CERTIFICATE
SERIES
2006-AR3
evidencing
a fractional undivided interest in the distributions allocable to the Class
A-[1A][1B][2][3A][3B][4A][4B] Certificates with respect to a Trust Fund
consisting primarily of a pool of conventional one- to four-family
adjustable-rate mortgage loans sold by NOMURA ASSET ACCEPTANCE
CORPORATION.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Nomura Asset Acceptance Corporation
(“NAAC”) or the Trustee or any of their affiliates or any other person. Neither
this Certificate nor the underlying Mortgage Loans are guaranteed or insured
by
any governmental entity or by NAAC or the Trustee or any of their affiliates
or
any other person. None of NAAC, the Trustee, the Securities Administrator
or any
of their affiliates will have any obligation with respect to any certificate
or
other obligation secured by or payable from payments on the Certificates.
This
certifies that Cede & Co. is the registered owner of the Percentage Interest
evidenced hereby in the beneficial ownership interest of Certificates of
the
same Class as this Certificate in a trust (the “Trust Fund”) generally
consisting of conventional first lien, adjustable-rate mortgage loans secured
by
one- to four- family residences, units in planned unit developments and
individual condominium units (collectively, the “Mortgage Loans”) sold by NAAC.
The Mortgage Loans were sold by Nomura Credit & Capital, Inc. (the
“Sponsor”) to NAAC. The Trust Fund was created pursuant to the Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
“Agreement”), among NAAC, as depositor (the “Depositor”), the Sponsor, GMAC
Mortgage Corporation, as a servicer, HSBC Bank USA, National Association,
as
trustee (the “Trustee”), and Xxxxx Fargo Bank, N.A., as master servicer (the
“Master Servicer”) and securities administrator (the “Securities
Administrator”), a summary of certain of the pertinent provisions of which is
set forth hereafter. To the extent not defined herein, capitalized terms
used
herein shall have the meaning ascribed to them in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of its acceptance hereof assents and by which such Holder is
bound.
Interest
on this Certificate will accrue during the period commencing on the immediately
preceding Distribution Date (as hereinafter defined) (or with respect to
the
First Distribution Date, the Closing Date) and ending on the day immediately
preceding the related Distribution Date on the Certificate Principal Balance
hereof at a per annum Pass-Through Rate equal to the least of (i) the sum
of
One-Month LIBOR for that Distribution Date plus (A) on or prior to the first
possible Optional Termination Date, [___]% or (B) after the first possible
Optional Termination Date, [__]%, (ii) the Net Funds Cap, (iii) the Cap Rate
and
(iv) the Maximum Interest Rate. The Securities Administrator will distribute
on
the 25th day of each month, or, if such 25th day is not a Business Day, the
immediately following Business Day (each, a “Distribution Date”), commencing on
the First Distribution Date specified above, to the Person in whose name
this
Certificate is registered at the close of business on the Business Day
immediately preceding such Distribution Date, an amount equal to the product
of
the Percentage Interest evidenced by this Certificate and the amount (of
interest and principal, if any) required to be distributed to the Holders
of
Certificates of the same Class as this Certificate. The Assumed Final
Distribution Date is the Distribution Date in October 2036 which is not likely
to be the date on which the Certificate Principal Balance of this Class of
Certificates will be reduced to zero.
Distributions
on this Certificate will be made by the Securities Administrator by check
mailed
to the address of the Person entitled thereto as such name and address shall
appear on the Certificate Register or, if such Person so requests by notifying
the Securities Administrator in writing as specified in the Agreement.
Notwithstanding the above, the final distribution on this Certificate will
be
made after due notice by the Securities Administrator of the pendency of
such
distribution and only upon presentation and surrender of this Certificate
at the
office or agency appointed by the Securities Administrator for that purpose
and
designated in such notice. The initial Certificate Principal Balance of this
Certificate is set forth above. The Certificate Principal Balance hereof
will be
reduced to the extent of distributions allocable to principal hereon and
any
Realized Losses allocable hereto.
This
Certificate is one of a duly authorized issue of Certificates designated
as set
forth on the face hereof (the “Certificates”). The Certificates, in the
aggregate, evidence the entire beneficial ownership interest in the Trust
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that the Trustee
is not
liable to the Certificateholders for any amount payable under this Certificate
or the Agreement or, except as expressly provided in the Agreement, subject
to
any liability under the Agreement.
This
Certificate does not purport to summarize the Agreement and reference is
made to
the Agreement for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced hereby, and the rights, duties and immunities
of the Securities Administrator. This Certificate is limited in right of
payment
to certain collections and recoveries respecting the Mortgage Loans and other
assets included in the Trust Fund relating to the Mortgage Loans (including
the
Interest Rate Swap Agreement), all as more specifically set forth in the
Agreement.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of the Class or Classes
of
Certificates affected thereby evidencing over 50% of the Voting Rights of
such
Class or Classes. Any such consent by the Holder of this Certificate shall
be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the
Certificates.
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable with the Securities
Administrator upon surrender of this Certificate for registration of transfer
at
the offices or agencies maintained by the Securities Administrator for such
purposes, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator duly executed by the
Holder
hereof or such Holder’s attorney duly authorized in writing, and thereupon one
or more new Certificates in authorized denominations representing a like
aggregate Percentage Interest will be issued to the designated
transferee.
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the Certificateholders for any such registration
of transfer, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee, the Securities
Administrator and any agent of any of them may treat the Person in whose
name
this Certificate is registered as the owner hereof for all purposes, and
none of
the Depositor, the Master Servicer, the Trustee, the Securities Administrator
or
any such agent shall be affected by notice to the contrary.
The
obligations created by the Agreement and the Trust Fund created thereby (other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund in accordance with the
terms
of the Agreement. Such optional repurchase may be made by such party only
if on
such Distribution Date the Stated Principal Balance of the Mortgage Loans
is
less than or equal to 10% of the Cut-off Date Principal Balance of the Mortgage
Loans. The exercise of such right will effect the early retirement of the
Certificates. In no event, however, will the Trust Fund created by the Agreement
continue beyond the earlier of (i) the expiration of 21 years after the death
of
certain persons identified in the Agreement and (ii) the Assumed Final
Distribution Date.
Unless
this Certificate has been countersigned by an authorized signatory of the
Securities Administrator by manual signature, this Certificate shall not
be
entitled to any benefit under the Agreement, or be valid for any
purpose.
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
Dated: September
__, 2006
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|
|
|
|
By: | ||
|
||
Authorized
Signatory
|
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class A-[1A][1B][2][3A][3B][4A][4B] Certificates referred to in
the
within-mentioned Agreement.
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
||
|
|
|
By: | ||
|
||
Authorized
Signatory
|
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and address
including postal zip code of assignee) a Percentage Interest evidenced by
the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of a
like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:
Dated:
|
_________________________________
|
Signature
by or on behalf of assignor
|
|
_________________________________
|
|
Signature
Guaranteed
|
DISTRIBUTION
INSTRUCTIONS
The
assignee should include the following for purposes of distribution:
Distributions
shall be made, by wire transfer or otherwise, in immediately available
|
|||||||
funds
to
|
|||||||
for
the account of
|
|||||||
account
number
|
or,
if mailed by check, to
|
||||||
Applicable
statements should be mailed to
|
|||||||
This
information is provided by
|
|||||||
assignee
named above, or
|
|||||||
its
agent.
|
EXHIBIT
A-2
FORM
OF CLASS M-[1][2][3][4][5] CERTIFICATE
THIS
CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR CERTIFICATES
[[AND
]THE CLASS M-1 CERTIFICATES] [,][AND ]THE CLASS M-2 CERTIFICATES] [,][AND
]THE
CLASS M-3 CERTIFICATES] [AND THE CLASS M-4
CERTIFICATES] AS DESCRIBED IN THE AGREEMENT (AS DEFINED
BELOW).
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “REGULAR INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986
(THE “CODE”).
THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DECREASED BY PRINCIPAL
PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO. ACCORDINGLY, FOLLOWING
THE
INITIAL ISSUANCE OF THE CERTIFICATES, THE CERTIFICATE PRINCIPAL BALANCE OF
THIS
CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION SHOWN BELOW. ANYONE
ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CERTIFICATE PRINCIPAL BALANCE
BY
INQUIRY OF THE SECURITIES ADMINISTRATOR NAMED HEREIN.
ANY
TRANSFEREE OF THIS CERTIFICATE SHALL BE DEEMED TO MAKE THE REPRESENTATIONS
SET
FORTH IN SECTION 6.02(b) OF THE AGREEMENT.
UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY TO THE DEPOSITOR OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF
CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON
IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
Certificate
No. [__]
|
Pass-Through
Rate: Floating
|
Class
M-[1][2][3][4][5] Subordinate
|
|
|
|
Date
of Pooling and Servicing Agreement and Cut-off Date:
September
1, 2006
|
Aggregate
Initial Certificate Principal Balance of the Class M-[1][2][3][4][5]
Certificates as of the Cut-off Date:
$
|
Trustee:
HSBC Bank USA, National Association
|
|
First
Distribution Date:
October
25, 2006
|
Initial
Certificate Principal Balance of this Certificate as of the Cut-off
Date:
$
|
Master
Servicer and Securities Administrator: Xxxxx Fargo Bank,
N.A.
|
|
Assumed
Final Distribution Date:
October
25, 2036
|
CUSIP:
[__________________]
|
MORTGAGE
PASS-THROUGH CERTIFICATE
SERIES
2006-AR3
evidencing
a fractional undivided interest in the distributions allocable to the Class
M-[1][2][3][4][5] Certificates with respect to a Trust Fund consisting primarily
of a pool of conventional one- to four-family adjustable-rate mortgage loans
sold by NOMURA ASSET ACCEPTANCE CORPORATION.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Nomura Asset Acceptance Corporation
(“NAAC”) or the Trustee or any of their affiliates or any other person. Neither
this Certificate nor the underlying Mortgage Loans are guaranteed or insured
by
any governmental entity or by NAAC or the Trustee or any of their affiliates
or
any other person. None of NAAC, the Trustee, the Securities Administrator
or any
of their affiliates will have any obligation with respect to any certificate
or
other obligation secured by or payable from payments on the
Certificates.
This
certifies that Cede & Co. is the registered owner of the Percentage Interest
evidenced hereby in the beneficial ownership interest of Certificates of
the
same Class as this Certificate in a trust (the “Trust Fund”) generally
consisting of conventional first lien, adjustable-rate mortgage loans secured
by
one- to four- family residences, units in planned unit developments and
individual condominium units (collectively, the “Mortgage Loans”) sold by NAAC.
The Mortgage Loans were sold by Nomura Credit & Capital, Inc. (the
“Sponsor”) to NAAC. The Trust Fund was created pursuant to the Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
“Agreement”), among NAAC, as depositor (the “Depositor”), the Sponsor, GMAC
Mortgage Corporation, as a servicer, HSBC Bank USA, National Association,
as
trustee (the “Trustee”), and Xxxxx Fargo Bank, N.A. as master servicer (the
“Master Servicer”) and securities administrator (the “Securities
Administrator”), a summary of certain of the pertinent provisions of which is
set forth hereafter. To the extent not defined herein, capitalized terms
used
herein shall have the meaning ascribed to them in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of its acceptance hereof assents and by which such Holder is
bound.
Interest
on this Certificate will accrue during the period commencing on the immediately
preceding Distribution Date (as hereinafter defined) (or with respect to
the
First Distribution Date, the Closing Date) and ending on the day immediately
preceding the related Distribution Date on the Certificate Principal Balance
hereof at a per annum Pass-Through Rate equal to the least of (i) the sum
of
One-Month LIBOR for that Distribution Date plus (A) on or prior to the first
possible Optional Termination Date, [___]% or (B) after the first possible
Optional Termination Date, [__]%, (ii) the Net Funds Cap, (iii) the Cap Rate
and
(iv) the Maximum Interest Rate. The Securities Administrator will distribute
on
the 25th day of each month, or, if such 25th day is not a Business Day, the
immediately following Business Day (each, a “Distribution Date”), commencing on
the First Distribution Date specified above, to the Person in whose name
this
Certificate is registered at the close of business on the Business Day
immediately preceding such Distribution Date, an amount equal to the product
of
the Percentage Interest evidenced by this Certificate and the amount (of
interest and principal, if any) required to be distributed to the Holders
of
Certificates of the same Class as this Certificate. The Assumed Final
Distribution Date is the Distribution Date in October 2036 which is not likely
to be the date on which the Certificate Principal Balance of this Class of
Certificates will be reduced to zero.
Distributions
on this Certificate will be made by the Securities Administrator by check
mailed
to the address of the Person entitled thereto as such name and address shall
appear on the Certificate Register or, if such Person so requests by notifying
the Securities Administrator in writing as specified in the Agreement.
Notwithstanding the above, the final distribution on this Certificate will
be
made after due notice by the Securities Administrator of the pendency of
such
distribution and only upon presentation and surrender of this Certificate
at the
office or agency appointed by the Securities Administrator for that purpose
and
designated in such notice. The initial Certificate Principal Balance of this
Certificate is set forth above. The Certificate Principal Balance hereof
will be
reduced to the extent of distributions allocable to principal hereon and
any
Realized Losses allocable hereto.
This
Certificate is one of a duly authorized issue of Certificates designated
as set
forth on the face hereof (the “Certificates”). The Certificates, in the
aggregate, evidence the entire beneficial ownership interest in the Trust
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that the Trustee
is not
liable to the Certificateholders for any amount payable under this Certificate
or the Agreement or, except as expressly provided in the Agreement, subject
to
any liability under the Agreement.
This
Certificate does not purport to summarize the Agreement and reference is
made to
the Agreement for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced hereby, and the rights, duties and immunities
of the Securities Administrator. This Certificates is limited in right of
payment to certain collections and recoveries respecting the Mortgage Loans
and
other assets included in the Trust Fund (including the Swap Agreement), all
as
more specifically set forth in the Agreement.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of the Class or Classes
of
Certificates affected thereby evidencing over 50% of the Voting Rights of
such
Class or Classes. Any such consent by the Holder of this Certificate shall
be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the
Certificates.
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable with the Securities
Administrator upon surrender of this Certificate for registration of transfer
at
the offices or agencies maintained by the Securities Administrator for such
purposes, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator duly executed by the
Holder
hereof or such Holder’s attorney duly authorized in writing, and thereupon one
or more new Certificates in authorized denominations representing a like
aggregate Percentage Interest will be issued to the designated
transferee.
Any
transferee of this Certificate shall be deemed to make the representations
set
forth in Section 6.02(b) of the Agreement.
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the Certificateholders for any such registration
of transfer, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee, the Securities
Administrator and any agent of any of them may treat the Person in whose
name
this Certificate is registered as the owner hereof for all purposes, and
none of
the Depositor, the Master Servicer, the Trustee, the Securities Administrator
or
any such agent shall be affected by notice to the contrary.
The
obligations created by the Agreement and the Trust Fund created thereby (other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund in accordance with the
terms
of the Agreement. Such optional repurchase may be made by such party only
if on
such Distribution Date the Stated Principal Balance of the Mortgage Loans
is
less than or equal to 10% of the Cut-off Date Principal Balance of the Mortgage
Loans. The exercise of such right will effect the early retirement of the
Certificates. In no event, however, will the Trust Fund created by the Agreement
continue beyond the earlier of (i) the expiration of 21 years after the death
of
certain persons identified in the Agreement and (ii) the Assumed Final
Distribution Date.
Unless
this Certificate has been countersigned by an authorized signatory of the
Securities Administrator by manual signature, this Certificate shall not
be
entitled to any benefit under the Agreement, or be valid for any
purpose.
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
Dated:
September __, 2006
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|
|
|
|
By: | ||
|
||
Authorized
Signatory
|
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class M-[1][2][3][4][5] Certificates referred to in the
within-mentioned Agreement.
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|
|
|
|
By: | ||
|
||
Authorized
Signatory
|
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and address
including postal zip code of assignee) a Percentage Interest evidenced by
the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of a
like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:
Dated:
|
_________________________________
|
Signature
by or on behalf of assignor
|
|
_________________________________
|
|
Signature
Guaranteed
|
DISTRIBUTION
INSTRUCTIONS
The
assignee should include the following for purposes of distribution:
Distributions
shall be made, by wire transfer or otherwise, in immediately available
|
|||||||
funds
to
|
|||||||
for
the account of
|
|||||||
account
number
|
or,
if mailed by check, to
|
||||||
Applicable
statements should be mailed to
|
|||||||
This
information is provided by
|
|||||||
assignee
named above, or
|
|||||||
its
agent.
|
EXHIBIT
A-3
FORM
OF CLASS P CERTIFICATE
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “REGULAR INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986
(THE “CODE”).
THIS
CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES LAWS. THE
HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE
MAY
BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE
WITH
THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE
144A
UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
(A
“QIB”), PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF
A
QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT
TO
AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES
ACT (IF
AVAILABLE) OR (3) IN CERTIFICATED FORM TO AN “INSTITUTIONAL ACCREDITED INVESTOR”
WITHIN THE MEANING THEREOF IN RULE 501(a)(1), (2), (3) or (7) OF REGULATION
D
UNDER THE ACT OR ANY ENTITY IN WHICH ALL OF THE EQUITY OWNERS COME WITHIN
SUCH
PARAGRAPHS PURCHASING NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES
ACT,
SUBJECT TO (A) THE RECEIPT BY THE SECURITIES ADMINISTRATOR OF A LETTER
SUBSTANTIALLY IN THE FORM PROVIDED IN THE AGREEMENT AND (B) THE RECEIPT BY
THE
SECURITIES ADMINISTRATOR OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE SECURITIES
ADMINISTRATOR THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE
WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH CASE IN ACCORDANCE
WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND ANY OTHER
APPLICABLE JURISDICTION.
NO
TRANSFER OF THIS CERTIFICATE SHALL BE MADE TO ANY PERSON, UNLESS THE TRANSFEREE
PROVIDES A CERTIFICATION PURSUANT TO SECTION 6.02(b) OF THE
AGREEMENT.
Certificate
No. [__]
|
Percentage
Interest: 100%
|
Class
P
|
|
Date
of Pooling and Servicing Agreement and Cut-off Date:
September
1, 2006
|
Aggregate
Initial Certificate Principal Balance of the Class P Certificates
as of
the Cut-off Date: $100
|
Trustee:
HSBC Bank USA, National Association
|
Master
Servicer and Securities Administrator: Xxxxx Fargo Bank,
N.A.
|
First
Distribution Date:
October
25, 2006
|
|
Assumed
Final Distribution Date:
October
25, 2036
|
CUSIP:
[________________]
|
MORTGAGE
PASS-THROUGH CERTIFICATE
SERIES
2006-AR3
evidencing
a fractional undivided interest in the distributions allocable to the Class
P
Certificates with respect to a Trust Fund consisting primarily of a pool
of
conventional one- to four-family adjustable-rate mortgage loans sold by NOMURA
ASSET ACCEPTANCE CORPORATION.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Nomura Asset Acceptance Corporation
(“NAAC”) or the Trustee referred to below or any of their affiliates or any
other person. Neither this Certificate nor the underlying Mortgage Loans
are
guaranteed or insured by any governmental entity or by NAAC or the Trustee
or
any of their affiliates or any other person. None of NAAC, the Trustee, the
Securities Administrator or any of their affiliates will have any obligation
with respect to any certificate or other obligation secured by or payable
from
payments on the Certificates.
This
certifies that Nomura Securities International, Inc. is the registered owner
of
the Percentage Interest evidenced hereby in the beneficial ownership interest
of
Certificates of the same Class as this Certificate in a trust (the “Trust
Fund”), generally consisting of conventional first lien, adjustable-rate
mortgage loans secured by one- to four- family residences, units in planned
unit
developments and individual condominium units (collectively, the “Mortgage
Loans”) sold by NAAC. The Mortgage Loans were sold by Nomura Credit &
Capital, Inc. (the “Sponsor”) to NAAC. The Trust Fund was created pursuant to
the Pooling and Servicing Agreement dated as of the Cut-off Date specified
above
(the “Agreement”), among NAAC, as depositor (the “Depositor”), the Sponsor, GMAC
Mortgage Corporation, as a servicer, HSBC Bank USA, National Association,
as
trustee (the “Trustee”), and Xxxxx Fargo Bank, N.A. as master servicer (the
“Master Servicer”) and securities administrator (the “Securities
Administrator”), a summary of certain of the pertinent provisions of which is
set forth hereafter. To the extent not defined herein, capitalized terms
used
herein shall have the meaning ascribed to them in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of its acceptance hereof assents and by which such Holder is
bound.
The
Securities Administrator will distribute on the 25th day of each month, or,
if
such 25th day is not a Business Day, the immediately following Business Day
(each, a “Distribution Date”), commencing on the First Distribution Date
specified above, to the Person in whose name this Certificate is registered
at
the close of business on the last day (or if such last day is not a Business
Day, the Business Day immediately preceding such last day) of the calendar
month
immediately preceding the month in which the Distribution Date occurs, an
amount
equal to the product of the Percentage Interest evidenced by this Certificate
and the amounts required to be distributed to the Holders of Certificates
of the
same Class as this Certificate. The Assumed Final Distribution Date is the
Distribution Date in October 2036.
Distributions
on this Certificate will be made by the Securities Administrator by check
mailed
to the address of the Person entitled thereto as such name and address shall
appear on the Certificate Register or, if such Person so requests by notifying
the Securities Administrator in writing as specified in the Agreement.
Notwithstanding the above, the final distribution on this Certificate will
be
made after due notice by the Securities Administrator of the pendency of
such
distribution and only upon presentation and surrender of this Certificate
at the
office or agency appointed by the Securities Administrator for that purpose
and
designated in such notice.
No
transfer of this Certificate shall be made unless the transfer is made pursuant
to an effective registration statement under the Securities Act of 1933,
as
amended (the “1933 Act”), and an effective registration or qualification under
applicable state securities laws, or is made in a transaction that does not
require such registration or qualification. In the event that such a transfer
of
this Certificate is to be made without registration or qualification, the
Securities Administrator shall require receipt of (i) if such transfer is
purportedly being made in reliance upon Rule 144A under the 1933 Act, written
certifications from the Holder of the Certificate desiring to effect the
transfer, and from such Holder’s prospective transferee, substantially in the
forms attached to the Agreement as Exhibit E and either F or G, as applicable,
and (ii) in all other cases, an Opinion of Counsel satisfactory to it that
such
transfer may be made without such registration or qualification (which Opinion
of Counsel shall not be an expense of the Trust Fund or of the Depositor,
the
Securities Administrator or the Trustee in their respective capacities as
such),
together with copies of the written certification(s) of the Holder of the
Certificate desiring to effect the transfer and/or such Holder’s prospective
transferee upon which such Opinion of Counsel is based. Neither the Depositor,
the Securities Administrator nor the Trustee is obligated to register or
qualify
the Class of Certificates specified on the face hereof under the 1933 Act
or any
other securities law or to take any action not otherwise required under the
Agreement to permit the transfer of such Certificates without registration
or
qualification. Any Holder desiring to effect a transfer of this Certificate
shall be required to indemnify the Trustee, the Securities Administrator,
the
Depositor and the Sponsor against any liability that may result if the transfer
is not so exempt or is not made in accordance with such federal and state
laws.
No
transfer of this Certificate shall be made to any person unless the transferee
provides a certification pursuant to Section 6.02(b) of the
Agreement.
This
Certificate is one of a duly authorized issue of Certificates designated
as set
forth on the face hereof (the “Certificates”). The Certificates, in the
aggregate, evidence the entire beneficial ownership interest in the Trust
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that the Securities
Administrator is not liable to the Certificateholders for any amount payable
under this Certificate or the Agreement or, except as expressly provided
in the
Agreement, subject to any liability under the Agreement.
This
Certificate does not purport to summarize the Agreement and reference is
made to
the Agreement for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced hereby, and the rights, duties and immunities
of the Securities Administrator. This Certificate is limited in right of
payment
to Prepayment Charges collected in respect of the Mortgage Loans and amounts
on
deposit in the Class P Certificate Account as more specifically set forth
in the
Agreement.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of the Class or Classes
of
Certificates affected thereby evidencing over 50% of the Voting Rights of
such
Class or Classes. Any such consent by the Holder of this Certificate shall
be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the
Certificates.
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable with the Securities
Administrator upon surrender of this Certificate for registration of transfer
at
the offices or agencies maintained by the Securities Administrator for such
purposes, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator duly executed by the
Holder
hereof or such Holder’s attorney duly authorized in writing, and thereupon one
or more new Certificates in authorized denominations representing a like
aggregate Percentage Interest will be issued to the designated
transferee.
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the Certificateholders for any such registration
of transfer, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee, the Securities
Administrator and any agent of any of them may treat the Person in whose
name
this Certificate is registered as the owner hereof for all purposes, and
none of
the Depositor, the Master Servicer, the Trustee, the Securities Administrator
or
any such agent shall be affected by notice to the contrary.
The
obligations created by the Agreement and the Trust Fund created thereby (other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund in accordance with the
terms
of the Agreement. Such optional repurchase may be made by such party only
if on
such Distribution Date the Stated Principal Balance of the Mortgage Loans
is
less than or equal to 10% of the Cut-off Date Principal Balance of the Mortgage
Loans. The exercise of such right will effect the early retirement of the
Certificates. In no event, however, will the Trust Fund created by the Agreement
continue beyond the earlier of (i) the expiration of 21 years after the death
of
certain persons identified in the Agreement and (ii) the Assumed Final
Distribution Date.
Unless
this Certificate has been countersigned by an authorized signatory of the
Securities Administrator by manual signature, this Certificate shall not
be
entitled to any benefit under the Agreement, or be valid for any
purpose.
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
Dated:
September __, 2006
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|
|
|
|
By: | ||
|
||
Authorized
Signatory
|
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class P Certificates referred to in the within-mentioned
Agreement.
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|
|
|
|
By: | ||
|
||
Authorized
Signatory
|
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and address
including postal zip code of assignee) a Percentage Interest evidenced by
the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of a
like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:
Dated:
|
_________________________________
|
Signature
by or on behalf of assignor
|
|
_________________________________
|
|
Signature
Guaranteed
|
DISTRIBUTION
INSTRUCTIONS
The
assignee should include the following for purposes of distribution:
Distributions
shall be made, by wire transfer or otherwise, in immediately available
|
|||||||
funds
to
|
|||||||
for
the account of
|
|||||||
account
number
|
or,
if mailed by check, to
|
||||||
Applicable
statements should be mailed to
|
|||||||
This
information is provided by
|
|||||||
assignee
named above, or
|
|||||||
its
agent.
|
EXHIBIT
A-4
FORM
OF CLASS R[-X] CERTIFICATE
THIS
CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A NON-UNITED STATES PERSON
OR A
DISQUALIFIED ORGANIZATION (AS DEFINED BELOW).
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “RESIDUAL INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT” AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986
(THE “CODE”).
NO
TRANSFER OF THIS CERTIFICATE SHALL BE MADE TO ANY PERSON, UNLESS THE TRANSFEREE
PROVIDES A CERTIFICATION PURSUANT TO SECTION 6.02(b) OF THE
AGREEMENT.
ANY
RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
IF
THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE SECURITIES
ADMINISTRATOR THAT (1) SUCH TRANSFEREE IS NOT (A) THE UNITED STATES, ANY
STATE
OR POLITICAL SUBDIVISION THEREOF, ANY POSSESSION OF THE UNITED STATES, OR
ANY
AGENCY OR INSTRUMENTALITY OF ANY OF THE FOREGOING (OTHER THAN AN INSTRUMENTALITY
WHICH IS A CORPORATION IF ALL OF ITS ACTIVITIES ARE SUBJECT TO TAX AND EXCEPT
FOR XXXXXXX MAC, A MAJORITY OF ITS BOARD OF DIRECTORS IS NOT SELECTED BY
SUCH
GOVERNMENTAL UNIT), (B) A FOREIGN GOVERNMENT, ANY INTERNATIONAL ORGANIZATION,
OR
ANY AGENCY OR INSTRUMENTALITY OF EITHER OF THE FOREGOING, (C) ANY ORGANIZATION
(OTHER THAN CERTAIN FARMERS’ COOPERATIVES DESCRIBED IN SECTION 521 OF THE CODE)
WHICH IS EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE UNLESS SUCH
ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE CODE (INCLUDING
THE TAX IMPOSED BY SECTION 511 OF THE CODE ON UNRELATED BUSINESS TAXABLE
INCOME), (D) RURAL ELECTRIC AND TELEPHONE COOPERATIVES DESCRIBED IN SECTION
1381(a)(2)(C) OF THE CODE, (E) AN ELECTING LARGE PARTNERSHIP UNDER SECTION
775(a) OF THE CODE (ANY SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A),
(B),
(C), (D) OR (E) BEING HEREIN REFERRED TO AS A “DISQUALIFIED ORGANIZATION”), OR
(F) AN AGENT OF A DISQUALIFIED ORGANIZATION, (2) NO PURPOSE OF SUCH TRANSFER
IS
TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX AND (3) SUCH TRANSFEREE SATISFIES
CERTAIN ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE
PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE
REGISTER OR ANY TRANSFER, SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO
A
DISQUALIFIED ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH
REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER
AND
SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE
HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON
THIS
CERTIFICATE. EACH HOLDER OF THIS CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE
SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS
PARAGRAPH.
Certificate
No.__
|
|
Class
R[-X]
|
Percentage
Interest: ____
|
Date
of Pooling and Servicing Agreement
and
Cut-off Date: September 1, 2006
|
|
First
Distribution Date:
October
25, 2006
|
|
Trustee:
HSBC Bank USA, National Association
|
Master
Servicer and Securities Administrator: Xxxxx Fargo Bank,
N.A.
|
Assumed
Final Distribution Date: October 25, 2036
|
|
CUSIP:
[__________________]
|
MORTGAGE
PASS-THROUGH CERTIFICATE
SERIES
2006-AR3
evidencing
a fractional undivided interest in the distributions allocable to the Class
R[-X] Certificates with respect to a Trust Fund consisting primarily of a
pool
of conventional one- to four-family adjustable-rate mortgage loans sold by
NOMURA ASSET ACCEPTANCE CORPORATION.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Nomura Asset Acceptance Corporation
(“NAAC”) or the Trustee referred to below or any of their affiliates or any
other person. Neither this Certificate nor the underlying Mortgage Loans
are
guaranteed or insured by any governmental entity or by NAAC or the Trustee
or
any of their affiliates or any other person. None of NAAC, the Trustee, the
Securities Administrator or any of their affiliates will have any obligation
with respect to any certificate or other obligation secured by or payable
from
payments on the Certificates.
This
certifies that Nomura Securities International, Inc. is the registered owner
of
the Percentage Interest evidenced hereby in the beneficial ownership interest
of
Certificates of the same Class as this Certificate in a trust (the “Trust Fund”)
generally consisting of conventional first lien, adjustable-rate mortgage
loans
secured by one- to four-family residences, units in planned unit developments
and individual condominium units (collectively, the “Mortgage Loans”) sold by
NAAC. The Mortgage Loans were sold by Nomura Credit & Capital, Inc. (the
“Sponsor”) to NAAC. The Trust Fund was created pursuant to the Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
“Agreement”), among NAAC, as depositor (the “Depositor”), the Sponsor, GMAC
Mortgage Corporation, as a servicer, HSBC Bank USA, National Association,
as
trustee (the “Trustee”), and Xxxxx Fargo Bank, N.A., as master servicer (the
“Master Servicer”) and securities administrator (the “Securities
Administrator”), a summary of certain of the pertinent provisions of which is
set forth hereafter. To the extent not defined herein, capitalized terms
used
herein shall have the meaning ascribed to them in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of its acceptance hereof assents and by which such Holder is
bound.
Each
Holder of this Certificate will be deemed to have agreed to be bound by the
restrictions set forth in the Agreement to the effect that (i) each person
holding or acquiring any Ownership Interest in this Certificate must be a
United
States Person and a Permitted Transferee, (ii) the transfer of any Ownership
Interest in this Certificate will be conditioned upon the delivery to the
Securities Administrator of, among other things, an affidavit to the effect
that
it is a United States Person and Permitted Transferee, (iii) any attempted
or
purported transfer of any Ownership Interest in this Certificate in violation
of
such restrictions will be absolutely null and void and will vest no rights
in
the purported transferee, and (iv) if any person other than a United States
Person and a Permitted Transferee acquires any Ownership Interest in this
Certificate in violation of such restrictions, then the Depositor will have
the
right, in its sole discretion and without notice to the Holder of this
Certificate, to sell this Certificate to a purchaser selected by the Depositor,
which purchaser may be the Depositor, or any affiliate of the Depositor,
on such
terms and conditions as the Depositor may choose.
The
Securities Administrator will distribute on the 25th day of each month, or,
if
such 25th day is not a Business Day, the immediately following Business Day
(each, a “Distribution Date”), commencing on the First Distribution Date
specified above, to the Person in whose name this Certificate is registered
at
the close of business on the last day (or if such last day is not a Business
Day, the Business Day immediately preceding such last day) of the calendar
month
immediately preceding the month in which the Distribution Date occurs, an
amount
equal to the product of the Percentage Interest evidenced by this Certificate
and the amounts required to be distributed to the Holders of Certificates
of the
same Class as this Certificate. The Assumed Final Distribution Date is the
Distribution Date in October 2036.
Distributions
on this Certificate will be made by the Securities Administrator by check
mailed
to the address of the Person entitled thereto as such name and address shall
appear on the Certificate Register or, if such Person so requests by notifying
the Securities Administrator in writing as specified in the Agreement.
Notwithstanding the above, the final distribution on this Certificate will
be
made after due notice by the Securities Administrator of the pendency of
such
distribution and only upon presentation and surrender of this Certificate
at the
office or agency appointed by the Securities Administrator for that purpose
and
designated in such notice.
No
transfer of this Certificate shall be made to any person unless the transferee
provides a certification pursuant to Section 6.02(b) of the
Agreement.
This
Certificate is one of a duly authorized issue of Certificates designated
as set
forth on the face hereof (the “Certificates”). The Certificates, in the
aggregate, evidence the entire beneficial ownership interest in the Trust
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that the Securities
Administrator is not liable to the Certificateholders for any amount payable
under this Certificate or the Agreement or, except as expressly provided
in the
Agreement, subject to any liability under the Agreement.
This
Certificate does not purport to summarize the Agreement and reference is
made to
the Agreement for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced hereby, and the rights, duties and immunities
of the Securities Administrator.
This
Certificate does not purport to summarize the Agreement and reference is
made to
the Agreement for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced hereby, and the rights, duties and immunities
of the Securities Administrator. This Certificates is limited in right of
payment to certain collections and recoveries respecting the Mortgage Loans
and
other assets included in the Trust Fund (including the Swap Agreement), all
as
more specifically set forth in the Agreement.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of the Class or Classes
of
Certificates affected thereby evidencing over 50% of the Voting Rights of
such
Class or Classes. Any such consent by the Holder of this Certificate shall
be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the
Certificates.
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable with the Securities
Administrator upon surrender of this Certificate for registration of transfer
at
the offices or agencies maintained by the Securities Administrator for such
purposes, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator duly executed by the
Holder
hereof or such Holder’s attorney duly authorized in writing, and thereupon one
or more new Certificates in authorized denominations representing a like
aggregate Percentage Interest will be issued to the designated
transferee.
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the Certificateholders for any such registration
of transfer, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee, the Securities
Administrator and any agent of any of them may treat the Person in whose
name
this Certificate is registered as the owner hereof for all purposes, and
none of
the Depositor, the Master Servicer, the Trustee, the Securities Administrator
or
any such agent shall be affected by notice to the contrary.
The
obligations created by the Agreement and the Trust Fund created thereby (other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund in accordance with the
terms
of the Agreement. Such optional repurchase may be made by such party only
if on
such Distribution Date the Stated Principal Balance of the Mortgage Loans
is
less than or equal to 10% of the Cut-off Date Principal Balance of the Mortgage
Loans. The exercise of such right will effect the early retirement of the
Certificates. In no event, however, will the Trust Fund created by the Agreement
continue beyond the earlier of (i) the expiration of 21 years after the death
of
certain persons identified in the Agreement and (ii) the Assumed Final
Distribution Date.
Unless
this Certificate has been countersigned by an authorized signatory of the
Securities Administrator by manual signature, this Certificate shall not
be
entitled to any benefit under the Agreement, or be valid for any
purpose.
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
Dated: September
__, 2006
|
XXXXX
FARGO BANK, N.A., as Securities
Administrator
|
|
|
|
|
By: | ||
|
||
Authorized
Signatory
|
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class R[-X] Certificates referred to in the within-mentioned
Agreement.
|
XXXXX
FARGO BANK, N.A., as Securities
Administrator
|
|
|
|
|
By: | ||
|
||
Authorized
Signatory
|
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and address
including postal zip code of assignee) a Percentage Interest evidenced by
the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of a
like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:
Dated:
|
_________________________________
|
Signature
by or on behalf of assignor
|
|
_________________________________
|
|
Signature
Guaranteed
|
DISTRIBUTION
INSTRUCTIONS
The
assignee should include the following for purposes of distribution:
Distributions
shall be made, by wire transfer or otherwise, in immediately available
|
|||||||
funds
to
|
|||||||
for
the account of
|
|||||||
account
number
|
or,
if mailed by check, to
|
||||||
Applicable
statements should be mailed to
|
|||||||
This
information is provided by
|
|||||||
assignee
named above, or
|
|||||||
its
agent.
|
EXHIBIT
A-5
FORM
OF CLASS X CERTIFICATE
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “REGULAR INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986
(THE “CODE”).
THIS
CERTIFICATE IS SUBORDINATE TO THE SENIOR CERTIFICATES AND MEZZANINE CERTIFICATES
TO THE EXTENT DESCRIBED IN THE AGREEMENT REFERRED TO
HEREIN.
THIS
CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES LAWS. THE
HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE
MAY
BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE
WITH
THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE
144A
UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
(A
“QIB”), PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF
A
QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT
TO
AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES
ACT (IF
AVAILABLE) OR (3) IN CERTIFICATED FORM TO AN “INSTITUTIONAL ACCREDITED INVESTOR”
WITHIN THE MEANING THEREOF IN RULE 501(a)(1), (2), (3) or (7) OF REGULATION
D
UNDER THE ACT OR ANY ENTITY IN WHICH ALL OF THE EQUITY OWNERS COME WITHIN
SUCH
PARAGRAPHS PURCHASING NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES
ACT,
SUBJECT TO (A) THE RECEIPT BY THE SECURITIES ADMINISTRATOR OF A LETTER
SUBSTANTIALLY IN THE FORM PROVIDED IN THE AGREEMENT AND (B) THE RECEIPT BY
THE
SECURITIES ADMINISTRATOR OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE SECURITIES
ADMINISTRATOR THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE
WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH CASE IN ACCORDANCE
WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND ANY OTHER
APPLICABLE JURISDICTION.
NO
TRANSFER OF THIS CERTIFICATE SHALL BE MADE TO ANY PERSON, UNLESS THE TRANSFEREE
PROVIDES A CERTIFICATION PURSUANT TO SECTION 6.02(b) OF THE
AGREEMENT.
Certificate
No. [__]
|
Percentage
Interest: [___]%
|
Class
X
|
Variable
Pass-Through Rate
|
Date
of Pooling and Servicing Agreement and Cut-off Date:
September
1, 2006
|
Initial
Certificate Notional Balance of this Certificate as of the Cut-off
Date:
$
|
Trustee:
HSBC Bank USA, National Association
|
Master
Servicer and Securities Administrator: Xxxxx Fargo Bank,
N.A.
|
First
Distribution Date:
October
25, 2006
|
|
Assumed
Final Distribution Date:
October
25, 2036
|
CUSIP:
[_____________]
|
MORTGAGE
PASS-THROUGH CERTIFICATE
SERIES
2006-AR3
evidencing
a fractional undivided interest in the distributions allocable to the Class
X
Certificates with respect to a Trust Fund consisting primarily of a pool
of
conventional one- to four-family adjustable-rate mortgage loans sold by NOMURA
ASSET ACCEPTANCE CORPORATION.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Nomura Asset Acceptance Corporation
(“NAAC”) or the Trustee referred to below or any of their affiliates or any
other person. Neither this Certificate nor the underlying Mortgage Loans
are
guaranteed or insured by any governmental entity or by NAAC or the Trustee
or
any of their affiliates or any other person. None of NAAC, the Trustee or
any of
their affiliates will have any obligation with respect to any certificate
or
other obligation secured by or payable from payments on the Certificates.
This
certifies that Nomura Securities International, Inc. is the registered owner
of
the Percentage Interest evidenced hereby in the beneficial ownership interest
of
Certificates of the same Class as this Certificate in a trust (the “Trust
Fund”), generally consisting of conventional first lien, adjustable-rate
mortgage loans secured by one- to four- family residences, units in planned
unit
developments and individual condominium units (collectively, the “Mortgage
Loans”) sold by NAAC. The Mortgage Loans were sold by Nomura Credit &
Capital, Inc. (the “Sponsor”) to NAAC. The Trust Fund was created pursuant to
the Pooling and Servicing Agreement dated as of the Cut-off Date specified
above
(the “Agreement”), among NAAC, as depositor (the “Depositor”), the Sponsor, GMAC
Mortgage Corporation, as a servicer, HSBC Bank USA, National Association,
as
trustee (the “Trustee”), and Xxxxx Fargo Bank, N.A. as master servicer (the
“Master Servicer”) and securities administrator (the “Securities
Administrator”), a summary of certain of the pertinent provisions of which is
set forth hereafter. To the extent not defined herein, capitalized terms
used
herein shall have the meaning ascribed to them in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of its acceptance hereof assents and by which such Holder is
bound.
Interest
on this Certificate will accrue during the month prior to the month in which
a
Distribution Date (as hereinafter defined) occurs on the Certificate Notional
Balance hereof at a per annum rate equal to the Class X Pass-Through Rate
as set
forth in the Agreement. The Securities Administrator will distribute on the
25th
day of each month, or, if such 25th day is not a Business Day, the immediately
following Business Day (each, a “Distribution Date”), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the last day (or if such last day
is
not a Business Day, the Business Day immediately preceding such last day)
of the
calendar month immediately preceding the month in which the Distribution
Date
occurs, an amount equal to the product of the Percentage Interest evidenced
by
this Certificate and the amount required to be distributed to the Holders
of
Certificates of the same Class as this Certificate. The Assumed Final
Distribution Date is the Distribution Date in October 2036.
Distributions
on this Certificate will be made by the Securities Administrator by check
mailed
to the address of the Person entitled thereto as such name and address shall
appear on the Certificate Register or, if such Person so requests by notifying
the Securities Administrator in writing as specified in the Agreement.
Notwithstanding the above, the final distribution on this Certificate will
be
made after due notice by the Securities Administrator of the pendency of
such
distribution and only upon presentation and surrender of this Certificate
at the
office or agency appointed by the Securities Administrator for that purpose
and
designated in such notice.
No
transfer of this Certificate shall be made unless the transfer is made pursuant
to an effective registration statement under the Securities Act of 1933,
as
amended (the “1933 Act”), and an effective registration or qualification under
applicable state securities laws, or is made in a transaction that does not
require such registration or qualification. In the event that such a transfer
of
this Certificate is to be made without registration or qualification, the
Securities Administrator shall require receipt of (i) if such transfer is
purportedly being made in reliance upon Rule 144A under the 1933 Act, written
certifications from the Holder of the Certificate desiring to effect the
transfer, and from such Holder’s prospective transferee, substantially in the
forms attached to the Agreement as Exhibit E and either F or G, as applicable,
and (ii) in all other cases, an Opinion of Counsel satisfactory to it that
such
transfer may be made without such registration or qualification (which Opinion
of Counsel shall not be an expense of the Trust Fund or of the Depositor,
the
Securities Administrator or the Trustee in their respective capacities as
such),
together with copies of the written certification(s) of the Holder of the
Certificate desiring to effect the transfer and/or such Holder’s prospective
transferee upon which such Opinion of Counsel is based. Neither the Depositor
nor the Trustee is obligated to register or qualify the Class of Certificates
specified on the face hereof under the 1933 Act or any other securities law
or
to take any action not otherwise required under the Agreement to permit the
transfer of such Certificates without registration or qualification. Any
Holder
desiring to effect a transfer of this Certificate shall be required to indemnify
the Trustee, the Securities Administrator, the Depositor and the Sponsor
against
any liability that may result if the transfer is not so exempt or is not
made in
accordance with such federal and state laws.
No
transfer of this Certificate shall be made to any person unless the transferee
provides a certification pursuant to Section 6.02(b) of the
Agreement.
This
Certificate is one of a duly authorized issue of Certificates designated
as set
forth on the face hereof (the “Certificates”). The Certificates, in the
aggregate, evidence the entire beneficial ownership interest in the Trust
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that the Securities
Administrator is not liable to the Certificateholders for any amount payable
under this Certificate or the Agreement or, except as expressly provided
in the
Agreement, subject to any liability under the Agreement.
This
Certificate does not purport to summarize the Agreement and reference is
made to
the Agreement for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced hereby, and the rights, duties and immunities
of the Securities Administrator. This Certificates is limited in right of
payment to certain collections and recoveries respecting the Mortgage Loans
and
other assets included in the Trust Fund (including the Swap Agreement), all
as
more specifically set forth in the Agreement.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of the Class or Classes
of
Certificates affected thereby evidencing over 50% of the Voting Rights of
such
Class or Classes. Any such consent by the Holder of this Certificate shall
be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the
Certificates.
As
provided in the Agreement and subject to certain limitations therein set
forth,
the transfer of this Certificate is registrable with the Securities
Administrator upon surrender of this Certificate for registration of transfer
at
the offices or agencies maintained by the Securities Administrator for such
purposes, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Securities Administrator duly executed by the
Holder
hereof or such Holder’s attorney duly authorized in writing, and thereupon one
or more new Certificates in authorized denominations representing a like
aggregate Percentage Interest will be issued to the designated
transferee.
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the Certificateholders for any such registration
of transfer, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee, the Securities
Administrator and any agent of any of them may treat the Person in whose
name
this Certificate is registered as the owner hereof for all purposes, and
none of
the Depositor, the Master Servicer, the Trustee, the Securities Administrator
or
any such agent shall be affected by notice to the contrary.
The
obligations created by the Agreement and the Trust Fund created thereby (other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund in accordance with the
terms
of the Agreement. Such optional repurchase may be made by such party only
if on
such Distribution Date the Stated Principal Balance of the Mortgage Loans
is
less than or equal to 10% of the Cut-off Date Principal Balance of the Mortgage
Loans. The exercise of such right will effect the early retirement of the
Certificates. In no event, however, will the Trust Fund created by the Agreement
continue beyond the earlier of (i) the expiration of 21 years after the death
of
certain persons identified in the Agreement and (ii) the Assumed Final
Distribution Date.
Unless
this Certificate has been countersigned by an authorized signatory of the
Securities Administrator by manual signature, this Certificate shall not
be
entitled to any benefit under the Agreement, or be valid for any
purpose.
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate
to be
duly executed.
Dated:
September __, 2006
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|
|
|
|
By: | ||
|
||
Authorized
Signatory
|
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class X Certificates referred to in the within-mentioned
Agreement.
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|
|
|
|
By: | ||
|
||
Authorized
Signatory
|
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and address
including postal zip code of assignee) a Percentage Interest evidenced by
the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of a
like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:
Dated:
|
_________________________________
|
Signature
by or on behalf of assignor
|
|
_________________________________
|
|
Signature
Guaranteed
|
DISTRIBUTION
INSTRUCTIONS
The
assignee should include the following for purposes of distribution:
Distributions
shall be made, by wire transfer or otherwise, in immediately available
|
|||||||
funds
to
|
|||||||
for
the account of
|
|||||||
account
number
|
or,
if mailed by check, to
|
||||||
Applicable
statements should be mailed to
|
|||||||
This
information is provided by
|
|||||||
assignee
named above, or
|
|||||||
its
agent.
|
EXHIBIT
B
MORTGAGE
LOAN SCHEDULE
The
Preliminary and Final Mortgage Loan Schedules shall set forth the following
information with respect to each Mortgage Loan:
(a)
|
the
Mortgage Loan identifying number;
|
|
(b)
|
the
Mortgage Rate in effect as of the Cut-off Date;
|
|
(c)
|
the
Servicing Fee Rate;
|
|
(d)
|
the
Net Mortgage Rate in effect as of the Cut-off Date;
|
|
(e)
|
the
maturity date;
|
|
(f)
|
the
original principal balance;
|
|
(g)
|
the
Cut-off Date Principal Balance;
|
|
(h)
|
the
original term;
|
|
(i)
|
the
remaining term;
|
|
(j)
|
the
property type;
|
|
(k)
|
the
product type (e.g., 2/28, 15 year fixed, 30 year fixed, 15/30 balloon,
etc.)
|
|
(l)
|
with
respect to each MOM Loan, the related MIN;
|
|
(m)
|
the
Custodian;
|
|
(n)
|
a
code indicating whether the Mortgage Loan is subject to a Prepayment
Charge, the term of such Prepayment Charge and the amount of such
Prepayment Charge;
|
|
(o)
|
the
first Adjustment Date;
|
|
(p)
|
the
Gross Margin;
|
|
(q)
|
the
Maximum Mortgage Interest Rate under the terms of the Mortgage
Note;
|
|
(r)
|
the
Minimum Mortgage Interest Rate under the terms of the Mortgage
Note;
|
|
(s)
|
the
Periodic Rate Cap;
|
|
(t)
|
the
first Adjustment Date immediately following the Cut-off Date;
|
|
(u)
|
the
related Index; and
|
|
(v)
|
the
Servicer.
|
EXHIBIT
C
MORTGAGE
LOAN PURCHASE AGREEMENT
MORTGAGE
LOAN PURCHASE AGREEMENT
This
is a
Mortgage Loan Purchase Agreement (this “Agreement”), dated September 29, 2006,
between Nomura Credit & Capital, Inc., a Delaware corporation (the “Seller”)
and Nomura Asset Acceptance Corporation, a Delaware corporation (the
“Purchaser”).
Preliminary
Statement
The
Seller intends to sell the Mortgage Loans (as hereinafter identified) and
the
Swap Agreement, to the Purchaser on the terms and subject to the conditions
set
forth in this Agreement. The Purchaser intends to deposit the Mortgage Loans
into a mortgage pool comprising the Trust Fund. The Trust Fund will be evidenced
by a single series of mortgage pass-through certificates designated as Nomura
Asset Acceptance Corporation, Alternative Loan Trust, Series 2006-AR3, Mortgage
Pass-Through Certificates (the “Certificates”). The Certificates will consist of
sixteen (16) classes of certificates. The Certificates will be issued pursuant
to a pooling and servicing agreement, dated as of September 1, 2006 (the
“Pooling and Servicing Agreement”), among the Purchaser as depositor, GMAC
Mortgage Corporation as a servicer (“GMACM”), Xxxxx Fargo Bank, N.A. (“Xxxxx
Fargo”) as master servicer and securities administrator, the Seller as sponsor
and HSBC Bank USA, National Association as trustee (the “Trustee”). The
Purchaser will sell the Class A-1A, Class X-0X, Xxxxx X-0, Class A-3A, Class
X-0X, Xxxxx X-0X, Xxxxx X-0X, Class M-1, Class M-2, Class M-3, Class M-4
and
Class M-5 Certificates to Nomura Securities International, Inc. (“NSI”) and
Xxxxxxx, Xxxxx & Co. (“GSC”, together with NSI, the “Underwriters”),
pursuant to the Amended and Restated Underwriting Agreement, dated September
1,
2006, between the Purchaser and NSI, and the Terms Agreement, dated September
27, 2006, among the Underwriters and the Purchaser. Capitalized terms used
but
not defined herein shall have the meanings set forth in the Pooling and
Servicing Agreement. Pursuant to the custodial agreement, dated as of September
1, 2006 (the “Custodial Agreement”), among the Trustee, GMACM as a servicer,
Wachovia Mortgage Corporation (“Wachovia”, together with GMACM, the “Servicers”)
as a servicer and Xxxxx Fargo as custodian (the “Custodian”), the Trustee
intends to have the Custodian take possession of the Mortgages and Mortgage
Notes, along with certain other documents specified in the Custodial Agreement,
as the custodian of the Trustee, in accordance with the terms and conditions
thereof.
The
parties hereto agree as follows:
SECTION
1. Agreement
to Purchase.
The
Seller hereby sells, and the Purchaser hereby purchases, on September 29,
2006
(the “Closing Date”), (a) certain conventional, one-to four family,
adjustable-rate mortgage loans secured by first liens on residential real
properties (the “Mortgage Loans”), having an aggregate principal balance as of
the close of business on September 1, 2006 (the “Cut-off Date”) of approximately
$476,229,351.38 (the “Closing Balance”), after giving effect to all payments due
on the Mortgage Loans on or before the Cut-off Date, whether or not received,
including the right to any Prepayment Charges payable by the related Mortgagors
in connection with any Principal Prepayments on the Mortgage Loans and (b)
the
swap agreement, dated as of September 29, 2006, between , ABN AMRO Bank N.V.
as
the swap provider and HSBC Bank USA, National Association, as trustee for
the
Supplemental Interest Trust (the “Swap Agreement”).
SECTION
2. Mortgage
Loan Schedule.
The
Purchaser and the Seller have agreed upon which of the mortgage loans owned
by
the Seller are to be purchased by the Purchaser pursuant to this Agreement
and
the Seller will prepare or cause to be prepared on or prior to the Closing
Date
a final schedule (the “Closing Schedule”) that describes such Mortgage Loans and
sets forth all of the Mortgage Loans to be purchased under this Agreement,
including the Prepayment Charges. The Closing Schedule will conform to the
requirements set forth in this Agreement and to the definition of “Mortgage Loan
Schedule” under the Pooling and Servicing Agreement.
SECTION
3. Consideration.
(a) In
consideration for the Mortgage Loans and the Swap Agreement to be purchased
hereunder, the Purchaser shall, as described in Section 10, (i) pay to or
upon
the order of the Seller in immediately available funds an amount (the “Purchase
Price”) equal to (i) $____________*
and (ii)
a 100% interest in the Class X, Class P, Class R and Class R-X Certificates
(collectively the “Private Certificates”) which shall be registered solely in
the name of NSI.
(b) The
Purchaser or any assignee, transferee or designee of the Purchaser shall
be
entitled to all scheduled payments of principal due after the Cut-off Date,
all
other payments of principal due and collected after the Cut-off Date, and
all
payments of interest on the Mortgage Loans allocable to the period after
the
Cut-off Date. All scheduled payments of principal and interest due on or
before
the Cut-off Date and collected after the Cut-off Date shall belong to the
Seller.
(c) Pursuant
to the Pooling and Servicing Agreement, the Purchaser will assign all of
its
right, title and interest in and to the Mortgage Loans and the Swap Agreement,
together with its rights under this Agreement, to the Trustee for the benefit
of
the Certificateholders.
SECTION
4. Transfer
of the Mortgage Loans.
(a) Possession
of Mortgage Files.
The
Seller does hereby sell to the Purchaser, without recourse but subject to
the
terms of this Agreement, all of its right, title and interest in, to and
under
the Mortgage Loans, including the related Prepayment Charges, and the Swap
Agreement. The contents of each Mortgage File not delivered to the Purchaser
or
to any assignee, transferee or designee of the Purchaser on or prior to the
Closing Date are and shall be held in trust by the Seller for the benefit
of the
Purchaser or any assignee, transferee or designee of the Purchaser. Upon
the
sale of the Mortgage Loans, the ownership of each Mortgage Note, the related
Mortgage and the other contents of the related Mortgage File is vested in
the
Purchaser and the ownership of all records and documents with respect to
the
related Mortgage Loan prepared by or that come into the possession of the
Seller
on or after the Closing Date shall immediately vest in the Purchaser and
shall
be delivered immediately to the Purchaser or as otherwise directed by the
Purchaser.
(b) Delivery
of Mortgage Loan Documents.
Pursuant
to various conveyance documents to be executed on the Closing Date and pursuant
to the Pooling and Servicing Agreement, the Purchaser will assign on the
Closing
Date all of its right, title and interest in and to the Mortgage Loans to
the
Trustee for the benefit of the Certificateholders. In connection with the
transfer and assignment of the Mortgage Loans, the Seller has delivered or
will
deliver or cause to be delivered to the Trustee by the Closing Date or such
later date as is agreed to by the Purchaser and the Seller (each of the Closing
Date and such later date is referred to as a “Mortgage
File Delivery Date”),
the
documents set forth on Exhibit
1
hereto,
provided,
however,
that in
lieu of the foregoing, the Seller may deliver the following documents, under
the
circumstances set forth below: (x) in lieu of the original Mortgage, assignments
to the Trustee or intervening assignments thereof which have been delivered,
are
being delivered or will upon receipt of recording information relating to
the
Mortgage required to be included thereon, be delivered to recording offices
for
recording and have not been returned in time to permit their delivery as
specified above, the Seller may deliver a true copy thereof with a certification
by the Seller on the face of such copy, substantially as follows: “Certified to
be a true and correct copy of the original, which has been transmitted for
recording;” (y) in lieu of the Mortgage, assignments to the Trustee or
intervening assignments thereof, if the applicable jurisdiction retains the
originals of such documents or if the originals are lost (in each case, as
evidenced by a certification from the Seller to such effect), the Seller
may
deliver photocopies of such documents containing an original certification
by
the judicial or other governmental authority of the jurisdiction where such
documents were recorded; and (z) in lieu of the Mortgage Notes relating to
the
Mortgage Loans, each identified in the list delivered by the Purchaser to
the
Trustee on the Closing Date and attached hereto as Exhibit
2
the
Seller may deliver lost note affidavits and indemnities of the Seller; and
provided further, however, that in the case of Mortgage Loans which have
been
prepaid in full after the Cut-off Date and prior to the Closing Date, the
Seller, in lieu of delivering the above documents, may deliver to the Trustee
a
certification by the Seller to such effect. The Seller shall deliver such
original documents (including any original documents as to which certified
copies had previously been delivered) or such certified copies to the Trustee
promptly after they are received. The Seller shall cause the Mortgage and
intervening assignments, if any, and the assignment of the Mortgage to be
recorded not later than 180 days after the Closing Date, or, in lieu of such
assignments, shall provide an Opinion of Counsel pursuant to Section 6 hereof
to
the effect that the recordation of such assignment is not necessary to protect
the Trustee’s interest in the related Mortgage Loan. Upon the request of the
Purchaser, the Seller will assist the Purchaser in effecting the assignment
referred to above.
(c) In
connection with the assignment of any Mortgage Loan registered on the MERS®
System, the Seller further agrees that it will cause, at the Seller’s own
expense, within thirty (30) days after the Closing Date, the MERS® System to
indicate that such Mortgage Loans have been assigned by the Seller to the
Purchaser and by the Purchaser to the Trustee in accordance with this Agreement
for the benefit of the Certificateholders by including (or deleting, in the
case
of Mortgage Loans which are repurchased in accordance with this Agreement)
in
such computer files (a) the code in the field which identifies the specific
Trustee and (b) the code in the field “Pool Field” which identifies the series
of the Certificates issued in connection with such Mortgage Loans. The Seller
further agrees that it will not, and will not permit the Servicers to alter
the
codes referenced in this paragraph with respect to any Mortgage Loan during
the
term of the Pooling and Servicing Agreement unless and until such Mortgage
Loan
is repurchased in accordance with the terms of the Pooling and Servicing
Agreement.
(d) Acceptance
of Mortgage Loans.
The
documents delivered pursuant to Section 4(b) hereof shall be reviewed by
the
Purchaser or any assignee, transferee or designee of the Purchaser at any
time
before or after the Closing Date (and with respect to each document permitted
to
be delivered after the Closing Date, within seven (7) days of its delivery)
to
ascertain that all required documents have been executed and received and
that
such documents relate to the Mortgage Loans identified on the Mortgage Loan
Schedule.
(e) Transfer
of Interest in Agreements.
The
Purchaser has the right to assign its interest under this Agreement, in whole
or
in part, to the Trustee, as may be required to effect the purposes of the
Pooling and Servicing Agreement, without the consent of the Seller, and the
assignee shall succeed to the rights and obligations hereunder of the Purchaser.
Any expense reasonably incurred by or on behalf of the Purchaser or the Trustee
in connection with enforcing any obligations of the Seller under this Agreement
will be promptly reimbursed by the Seller.
SECTION
5. Examination
of Mortgage Files.
(a) On
or
before the Mortgage File Delivery Date, the Seller will have made the Mortgage
Files available to the Purchaser or its agent for examination which may be
at
the offices of the Trustee or the Seller and/or the Seller’s custodian. The fact
that the Purchaser or its agent has conducted or has failed to conduct any
partial or complete examination of the Mortgage Files shall not affect the
Purchaser’s rights to demand cure, repurchase, substitution or other relief as
provided in this Agreement. In furtherance of the foregoing, the Seller shall
make the Mortgage Files available to the Purchaser or its agent from time
to
time so as to permit the Purchaser to confirm the Seller’s compliance with the
delivery and recordation requirements of this Agreement and the Pooling and
Servicing Agreement. In addition, upon request of the Purchaser, the Seller
agrees to provide to the Purchaser, the Underwriters and to any investors
or
prospective investors in the Certificates information regarding the Mortgage
Loans (which may be at the offices of the Seller and/or the Seller’s custodian)
and to make available personnel knowledgeable about the Mortgage Loans for
discussions with the Purchaser, the Underwriters and such investors or
prospective investors, upon reasonable request during regular business hours,
sufficient to permit the Purchaser, the Underwriters and such investors or
potential investors to conduct such due diligence as any such party reasonably
believes is appropriate.
(b) Pursuant
to the Pooling and Servicing Agreement, on the Closing Date the Custodian
on
behalf of the Trustee, for the benefit of the Certificateholders, will review
items of the Mortgage Files as set forth on Exhibit
1
and will
deliver to the Seller a certification in the form attached as Exhibit 1 to
the
Custodial Agreement.
(c) Pursuant
to the Pooling and Servicing Agreement, the Trustee or the Custodian, on
behalf
of the Trustee, will review the Mortgage Files within 180 days of the Closing
Date and will deliver to the Seller a final certification substantially in
the
form of Exhibit 2 to the Custodial Agreement. If the Custodian is unable
to
deliver a final certification with respect to the items listed in Exhibit
2
due to
any document that is missing, has not been executed or is unrelated, determined
on the basis of the Mortgagor name, original principal balance and loan number,
to the Mortgage Loans identified in the Final Mortgage Loan Schedule (a
“Material
Defect”),
pursuant to Section 6 of the Custodial Agreement, the Custodian will notify
the
Trustee of such Material Defect and the Trustee shall notify the Seller of
such
Material Defect. The Seller shall correct or cure any such Material Defect
within ninety (90) days from the date of notice from the Trustee of the Material
Defect and if the Seller does not correct or cure such Material Defect within
such period and such defect materially and adversely affects the interests
of
the Certificateholders in the related Mortgage Loan, the Seller will, in
accordance with the terms of the Pooling and Servicing Agreement, within
ninety
(90) days of the date of notice, provide the Trustee with a Substitute Mortgage
Loan (if within two (2) years of the Closing Date) or purchase the related
Mortgage Loan at the applicable Purchase Price; provided,
however,
that if
such defect relates solely to the inability of the Seller to deliver the
original security instrument or intervening assignments thereof, or a certified
copy because the originals of such documents, or a certified copy, have not
been
returned by the applicable jurisdiction, the Seller shall not be required
to
purchase such Mortgage Loan if the Seller delivers such original documents
or
certified copy promptly upon receipt, but in no event later than 360 days
after
the Closing Date. The foregoing repurchase obligation shall not apply in
the
event that the Seller cannot deliver such original or copy of any document
submitted for recording to the appropriate recording office in the applicable
jurisdiction because such document has not been returned by such office;
provided that the Seller shall instead deliver a recording receipt of such
recording office or, if such receipt is not available, a certificate of the
Seller or a Servicing Officer confirming that such documents have been accepted
for recording, and delivery to the Trustee shall be effected by the Seller
within thirty (30) days of its receipt of the original recorded
document.
(d) At
the
time of any substitution, the Seller shall deliver or cause to be delivered
the
Replacement Mortgage Loan, the related Mortgage File and any other documents
and
payments required to be delivered in connection with a substitution pursuant
to
the Pooling and Servicing Agreement. At the time of any purchase or
substitution, the Trustee shall (i) assign to the Seller and cause the
Custodian, on behalf of the Trustee, to release the documents (including,
but
not limited to, the Mortgage, Mortgage Note and other contents of the Mortgage
File) in the possession of the Custodian, on behalf of the Trustee, relating
to
the Deleted Mortgage Loan and (ii) execute and deliver such instruments of
transfer or assignment, in each case without recourse, as shall be necessary
to
vest in the Seller title to such Deleted Mortgage Loan.
SECTION
6. Recordation
of Assignments of Mortgage.
(a) The
Seller will, promptly after the Closing Date, cause each Mortgage and each
assignment of Mortgage from the Seller to the Trustee, and all unrecorded
intervening assignments, if any, delivered on or prior to the Closing Date,
to
be recorded in all recording offices in the jurisdictions where the related
Mortgaged Properties are located; provided,
however,
the
Seller need not cause to be recorded any assignment for which (a) the related
Mortgaged Property is located in (a) any jurisdiction under the laws of which,
as evidenced by an Opinion of Counsel delivered by the Seller to the Trustee
and
the Rating Agencies, the recordation of such assignment is not necessary
to
protect the Trustee’s interest in the related Mortgage Loan or (b) MERS is
identified on the Mortgage or on a properly recorded assignment of the Mortgage
as mortgagee of record solely as nominee for Seller and its successors and
assigns; provided,
however,
notwithstanding the delivery of any Opinion of Counsel, each assignment of
Mortgage shall be submitted for recording by the Seller in the manner described
above, at no expense to the Trust Fund or Trustee, upon the earliest to occur
of
(i) reasonable direction by the Holders of Certificates evidencing Percentage
Interests aggregating not less than twenty-five percent (25%) of the Trust,
(ii)
the occurrence of an Event of Default, (iii) the occurrence of a bankruptcy,
insolvency or foreclosure relating to the Seller, (iv) the occurrence of
a
servicing transfer as described in Section 8.02 of the Pooling and Servicing
Agreement or (v) with respect to any assignment of Mortgage, the occurrence
of a
bankruptcy, insolvency or foreclosure relating to the Mortgagor under the
related Mortgage.
(b) While
each such Mortgage or assignment is being recorded, if necessary, the Seller
shall leave or cause to be left with the Custodian, on behalf of the Trustee,
a
certified copy of such Mortgage or assignment. In the event that, within
180
days of the Closing Date, the Trustee has not been provided with an Opinion
of
Counsel as described above or received evidence of recording with respect
to
each Mortgage Loan delivered to the Purchaser pursuant to the terms hereof
or as
set forth above and the related Mortgage Loan is not a MOM Loan, the failure
to
provide evidence of recording or such Opinion of Counsel shall be considered
a
Material Defect, and the provisions of Section 5(c) and (d) shall apply.
All
customary recording fees and reasonable expenses relating to the recordation
of
the assignments of mortgage to the Trustee or the Opinion of Counsel, as
the
case may be, shall be borne by the Seller.
SECTION
7. Representations,
Warranties and Covenants of the Seller.
The
Seller hereby represents and warrants to the Purchaser, as of the date hereof
and as of the Closing Date, and covenants, that:
(i) The
Seller is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware and is qualified and in good standing
to
do business in each jurisdiction where such qualification is necessary, except
where the failure so to qualify would not reasonably be expected to have
a
material adverse effect on the Seller’s business as presently conducted or on
the Seller’s ability to enter into this Agreement and to consummate the
transactions contemplated hereby.
(ii) The
Seller has duly authorized the execution, delivery and performance of this
Agreement, has duly executed and delivered this Agreement, and this Agreement,
assuming due authorization, execution and delivery by the Purchaser, constitutes
a legal, valid and binding obligation of the Seller, enforceable against
it in
accordance with its terms except as the enforceability thereof may be limited
by
bankruptcy, insolvency or reorganization or by general principles of
equity.
(iii) The
execution, delivery and performance of this Agreement by the Seller (x) does
not
conflict and will not conflict with, does not breach and will not result
in a
breach of and does not constitute and will not constitute a default (or an
event, which with notice or lapse of time or both, would constitute a default)
under (A) any terms or provisions of the organizational documents of the
Seller,
(B) any term or provision of any material agreement, contract, instrument
or
indenture, to which the Seller is a party or by which the Seller or any of
its
property is bound, or (C) any law, rule, regulation, order, judgment, writ,
injunction or decree of any court or governmental authority having jurisdiction
over the Seller or any of its property and (y) does not create or impose
and
will not result 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.
(iv) No
consent, approval, authorization or order of, registration or filing with,
or
notice on behalf of the Seller to any governmental authority or court is
required, under federal laws or the laws of the State of New York, for the
execution, delivery and performance by the Seller of, or compliance by the
Seller with, this Agreement or the consummation by the Seller of any other
transaction contemplated hereby and by the Pooling and Servicing Agreement;
provided, however, that the Seller makes no representation or warranty regarding
federal or state securities laws in connection with the sale or distribution
of
the Certificates.
(v) This
Agreement does not contain any untrue statement of material fact or omit
to
state a material fact necessary to make the statements contained herein not
misleading. The written statements, reports and other documents prepared
and
furnished or to be prepared and furnished by the Seller pursuant to this
Agreement or in connection with the transactions contemplated hereby taken
in
the aggregate do not contain any untrue statement of material fact or omit
to
state a material fact necessary to make the statements contained therein
not
misleading.
(vi) The
Seller is not in violation of, and the execution and delivery of this Agreement
by the Seller and its performance and compliance with the terms of this
Agreement will not constitute a violation with respect to, any order or decree
of any court or any order or regulation of any federal, state, municipal
or
governmental agency having jurisdiction over the Seller or its assets, which
violation might have consequences that would materially and adversely affect
the
condition (financial or otherwise) or the operation of the Seller or its
assets
or might have consequences that would materially and adversely affect the
performance of its obligations and duties hereunder.
(vii) The
Seller does not believe, nor does it have any reason or cause to believe,
that
it cannot perform each and every covenant contained in this
Agreement.
(viii) Immediately
prior to the sale of the Mortgage Loans to the Purchaser as herein contemplated,
the Seller was the owner of the related Mortgage and the indebtedness evidenced
by the related Mortgage Note, and, upon the payment to the Seller of the
Purchase Price, in the event that the Seller retains or has retained record
title, the Seller shall retain such record title to each Mortgage, each related
Mortgage Note and the related Mortgage Files with respect thereto in trust
for
the Purchaser as the owner thereof from and after the date hereof.
(ix) There
are
no actions or proceedings against, or investigations known to it of, the
Seller
before any court, administrative or other tribunal (A) that might prohibit
its
entering into this Agreement, (B) seeking to prevent the sale of the Mortgage
Loans by the Seller or the consummation of the transactions contemplated
by this
Agreement or (C) that might prohibit or materially and adversely affect the
performance by the Seller of its obligations under, or validity or
enforceability of, this Agreement.
(x) The
consummation of the transactions contemplated by this Agreement are in the
ordinary course of business of the Seller, and the transfer, assignment and
conveyance of the Mortgage Notes and the Mortgages by the Seller pursuant
to
this Agreement are not subject to the bulk transfer or any similar statutory
provisions in effect in any relevant jurisdiction, except any as may have
been
complied with.
(xi) The
Seller has not dealt with any broker, investment banker, agent or other person,
except for the Purchaser or any of its affiliates, that may be entitled to
any
commission or compensation in connection with the sale of the Mortgage Loans
(except that an entity that previously financed the Seller’s ownership of the
Mortgage Loans may be entitled to a fee to release its security interest
in the
Mortgage Loans, which fee shall have been paid and which security interest
shall
have been released on or prior to the Closing Date).
(xii) There
is
no litigation currently pending or, to the best of the Seller’s knowledge
without independent investigation, threatened against the Seller that would
reasonably be expected to adversely affect the transfer of the Mortgage Loans,
the issuance of the Certificates or the execution, delivery, performance
or
enforceability of this Agreement, or that would result in a material adverse
change in the financial condition of the Seller.
(xiii) The Seller
is a HUD approved mortgagee pursuant to Section 203 of the National Housing
Act.
SECTION
8. Representations
and Warranties of the Seller Relating to the Mortgage Loans.
The
Seller hereby represents and warrants to the Purchaser that as to each Mortgage
Loan as of the Closing Date:
(i) Information
provided to the Rating Agencies, including the loan level detail, is true
and
correct according to the Rating Agency requirements;
(ii) No
fraud
has taken place on the part of the Mortgagor or any other party involved
in the
origination or servicing of the Mortgage Loan;
(iii) No
Monthly Payment required to be made under any Mortgage Loan has been, or
will
be, contractually delinquent by one month or more on, or at any time preceding,
the date such Mortgage Loan was purchased by the Seller;
(iv) Neither
the Seller nor the related originator of the Mortgage Loan has advanced any
Monthly Payment required under the terms of the Mortgage Note;
(v) There
are
no delinquent taxes, assessment liens or insurance premiums affecting the
related Mortgaged Property;
(vi) The
terms
of the Mortgage Note and the Mortgage have not been materially impaired,
waived,
altered or modified in any respect, except by written instruments, recorded
in
the applicable public recording office if necessary to maintain the lien
priority of the Mortgage. The substance of any such waiver, alteration or
modification has been approved by the title insurer, to the extent required
by
the related policy. No Mortgagor has been released, in whole or in part,
except
in connection with an assumption agreement (approved by the title insurer
to the
extent required by the policy) and which assumption agreement has been delivered
to the Trustee;
(vii) The
Mortgaged Property is insured against loss by fire and hazards of extended
coverage (excluding earthquake insurance) in an amount which is at least
equal
to the lesser of (i) the amount necessary to compensate for any damage or
loss
to the improvements which are a part of such property on a replacement cost
basis or (ii) the outstanding principal balance of the Mortgage Loan. If
the
Mortgaged Property is in an area identified on a flood hazard map or flood
insurance rate map issued by the Federal Emergency Management Agency as having
special flood hazards (and such flood insurance has been made available),
a
flood insurance policy meeting the requirements of the current guidelines
of the
Federal Insurance Administration is in effect. All such insurance policies
contain a standard mortgagee clause naming the originator of the Mortgage
Loan,
its successors and assigns as mortgagee and the Seller has not engaged in
any
act or omission which would impair the coverage of any such insurance policies.
Except as may be limited by applicable law, the Mortgage obligates the Mortgagor
thereunder to maintain all such insurance at the Mortgagor's cost and expense,
and on the Mortgagor's failure to do so, authorizes the holder of the Mortgage
to maintain such insurance at Mortgagor's cost and expense and to seek
reimbursement therefor from the Mortgagor;
(viii) Any
and
all requirements of any federal, state or local law including, without
limitation, usury, truth in lending, real estate settlement procedures, consumer
credit protection, equal credit opportunity, fair housing, predatory, fair
lending or disclosure laws applicable to the origination and servicing of
the
Mortgage Loans have been complied with in all material respects, and the
consummation of the transaction contemplated hereby will not involve the
violation of any such laws;
(ix) The
Mortgage has not been satisfied, cancelled, subordinated or rescinded, in
whole
or in part, and the Mortgaged Property has not been released from the lien
of
the Mortgage, in whole or in part, nor has any instrument been executed that
would effect any such satisfaction, cancellation, subordination, rescission
or
release;
(x)
The
Mortgage was recorded or was submitted for recording in accordance with all
applicable laws and is a valid, existing and enforceable perfected first
lien on
the Mortgaged Property including all improvements on the Mortgaged Property,
subject only to (a) the lien of the current real property taxes and (b)
covenants, conditions and restrictions, rights of way and
easements;
(xi) The
Mortgage Note and the related Mortgage are genuine and each is the legal,
valid
and binding obligation of the maker thereof, insured under the related title
policy, and enforceable in accordance with its terms, except to the extent
that
the enforceability thereof may be limited by a bankruptcy, insolvency or
reorganization;
(xii) The
Seller is the sole legal, beneficial and equitable owner of the Mortgage
Note
and the Mortgage and has the full right to convey, transfer and sell the
Mortgage Loan to the Purchaser free and clear of any encumbrance, equity,
lien,
pledge, charge, claim or security interest and immediately upon the sale,
assignment and endorsement of the Mortgage Loans from the Seller to the
Purchaser, the Purchaser shall have good and indefeasible title to and be
the
sole legal owner of the Mortgage Loans subject only to any encumbrance, equity,
lien, pledge, charge, claim or security interest arising out of the Purchaser’s
actions;
(xiii) Each
Mortgage Loan is covered by a valid and binding American Land Title Association
lender's title insurance policy issued by a title insurer qualified to do
business in the jurisdiction where the Mortgaged Property is located, which
title insurance policy is generally acceptable to Xxxxxx Xxx and Xxxxxxx
Mac. No
claims have been filed under such lender's title insurance policy, and the
Seller has not done, by act or omission, anything that would impair the coverage
of the lender's title insurance policy;
(xiv) There
is
no material default, breach, violation event or event of acceleration existing
under the Mortgage or the Mortgage Note and no event which, with the passage
of
time or with notice and the expiration of any grace or cure period, would
constitute a material default, breach, violation or event of acceleration,
and
the Seller has not, nor has its predecessors, waived any material default,
breach, violation or event of acceleration;
(xv) There
are
no mechanics' or similar liens or claims which have been filed for work,
labor
or material provided to the related Mortgaged Property prior to the origination
of the Mortgage Loan which are or may be liens prior to, or equal or coordinate
with, the lien of the related Mortgage, except as may be disclosed in the
related title policy;
(xvi) Except
with respect to approximately 0.54% of the Mortgage Loans by aggregate principal
balance as of the Cut-off Date, which are balloon loans and approximately
89.08%
of the Mortgage Loans by aggregate principal balance as of the Cut-off Date,
which are interest only loans, each Mortgage Note is payable on the first
day of
each month in equal monthly installments of principal and interest (subject
to
adjustment in the case of the adjustable rate Mortgage Loans), with interest
calculated on a 30/360 basis and payable in arrears, sufficient to amortize
the
Mortgage Loan fully by the stated maturity date over an original term from
commencement of amortization to not more than thirty (30) years. No Mortgage
Loan permits negative amortization;
(xvii) The
servicing practices used in connection with the servicing of the Mortgage
Loans
have been in all respects reasonable and customary in the mortgage servicing
industry of like mortgage loan servicers, servicing mortgage loans similar
to
the Mortgage Loans in the same jurisdiction as the Mortgaged
Property;
(xviii) At
the
time of origination of the Mortgage Loan there was no proceeding pending
for the
total or partial condemnation of the Mortgaged Property and, as of the date
such
Mortgage Loan was purchased by the Purchaser, to the best of the Purchaser’s
knowledge there is no proceeding pending for the total or partial condemnation
of the Mortgaged Property;
(xix) The
Mortgage and related Mortgage Note contain customary and enforceable provisions
such as to render the rights and remedies of the holder thereof adequate
for the
realization against the Mortgaged Property of the benefits of the security
provided thereby, including, (a) in the case of a Mortgage designated as
a deed
of trust, by trustee's sale, and (b) otherwise by judicial
foreclosure;
(xx) The
Mortgage Note is not and has not been secured by any collateral except the
lien
of the related Mortgage referred to in subsection (x) above;
(xxi) In
the
event the Mortgage constitutes a deed of trust, a trustee, duly qualified
under
applicable law to serve as such, has been properly designated and currently
so
serves and is named in the Mortgage, and no fees or expenses are or will
become
payable by the Seller to the trustee under the deed of trust, except in
connection with a trustee's sale after default by the Mortgagor;
(xxii) The
Mortgage Loan is not subject to any valid right of rescission, set-off,
counterclaim or defense, including without limitation the defense of usury,
nor
will the operation of any of the terms of the Mortgage Note or the Mortgage,
or
the exercise of any right thereunder, render either the Mortgage Note or
the
Mortgage unenforceable, in whole or in part, or subject to any such right
of
rescission, set-off, counterclaim or defense, including without limitation
the
defense of usury, and no such right of rescission, set-off, counterclaim
or
defense has been asserted with respect thereto;
(xxiii) The
Mortgaged Property is free of material damage and in good repair, excepting
therefrom any Mortgage Loan subject to an escrow withhold as shown on the
Mortgage Loan Schedule;
(xxiv) All
of
the improvements which were included in determining the appraised value of
the
Mortgaged Property lie wholly within the Mortgaged Property's boundary lines
and
no improvements on adjoining properties encroach upon the Mortgaged Property,
excepting therefrom: (i) any encroachment insured against in the lender's
title
insurance policy identified in clause (xiii) above, (ii) any encroachment
generally acceptable to mortgage loan originators doing business in the same
jurisdiction as the Mortgaged Property, and (iii) any encroachment which
does
not materially interfere with the benefits of the security intended to be
provided by such Mortgage;
(xxv) All
parties to the Mortgage Note had the legal capacity to execute the Mortgage
Note
and the Mortgage, and the Mortgage Note and the Mortgage have been duly executed
by such parties;
(xxvi) To
the
best of the Seller’s knowledge, at the time of origination of the Mortgage Loan,
no appraised improvement located on or being part of the Mortgaged Property
was
in violation of any applicable zoning law or regulation and all inspections,
licenses and certificates required in connection with the origination of
any
Mortgage Loan with respect to the occupancy of the Mortgaged Property, have
been
made or obtained from the appropriate authorities;
(xxvii) No
Mortgagor has notified the Seller of any relief requested or allowed under
the
Servicemembers Civil Relief Act;
(xxviii) All
parties which have held an interest in the Mortgage Loan are (or during the
period in which they held and disposed of such interest, were) (1) in compliance
with any and all applicable licensing requirements of the state wherein the
Mortgaged Property is located, (2) organized under the laws of such state,
(3)
qualified to do business in such state, (4) a federal savings and loan
association or national bank, (5) not doing business in such state, or (6)
exempt from the applicable licensing requirements of such state;
(xxix) The
Mortgage File contains an appraisal of the related Mortgaged Property which
was
made prior to the approval of the Mortgage Loan by a qualified appraiser,
duly
appointed by the related originator and was made in accordance with the
Financial Institutions Reform, Recovery, and Enforcement Act of 1989 and
the
Uniform Standards of Professional Appraisal Practice;
(xxx) Except
as
may otherwise be limited by applicable law, the Mortgage contains an enforceable
provision for the acceleration of the payment of the unpaid principal balance
of
the Mortgage Loan in the event that the Mortgaged Property is sold or
transferred without the prior written consent of the Mortgagee
thereunder;
(xxxi) The
Mortgage Loan does not contain any provision which would constitute a “buydown”
provision and pursuant to which Monthly Payments are paid or partially paid
with
funds deposited in a separate account established by the related originator,
the
Mortgagor or anyone on behalf of the Mortgagor, or paid by any source other
than
the Mortgagor. The Mortgage Loan is not a “graduated payment mortgage loan” and
the Mortgage loan does not have a shared appreciation or other contingent
interest feature;
(xxxii) To
the
best of the Seller’s knowledge there is no action or proceeding directly
involving the Mortgaged Property presently pending in which compliance with
any
environmental law, rule or regulation is at issue and the Seller has received
no
notice of any condition at the Mortgaged Property which is reasonably likely
to
give rise to an action or proceeding in which compliance with any environmental
law, rule or regulation is at issue;
(xxxiii) Each
Mortgage Loan is an obligation which is principally secured by an interest
in
real property within the meaning of Treasury Regulation section 1.860G-2(a);
(xxxiv) Each
Mortgage Loan is directly secured by a first lien on, and consists of a single
parcel of, real property with a detached one-to-four family residence erected
thereon, a townhouse or an individual condominium unit in a condominium project,
or an individual unit in a planned unit development (“PUD”). No residence or
dwelling is a leasehold, mobile home or a manufactured dwelling unless it
is an
Acceptable Manufactured Dwelling. An “Acceptable Manufactured Dwelling” is a
manufactured dwelling, which is permanently affixed to a foundation and treated
as “real estate” under applicable law. No Mortgaged Property is used for
commercial purposes. Mortgaged Properties which contain a home office shall
not
be considered as being used for commercial purposes as long as the Mortgaged
Property has not been altered for commercial purposes and is not storing
any
chemicals or raw materials other than those commonly used for homeowner repair,
maintenance and/or household purposes;
(xxxv) The
Mortgage Interest Rate payable by the Mortgagor with respect to the Adjustable
Rate Mortgage Loans is subject to adjustment at the time and in the amounts
as
are set forth in the related Mortgage Note;
(xxxvi)
The first scheduled Monthly Payment under the terms of each Mortgage Note
was
received by the servicer servicing such Mortgage Loan by the 30th day following
the related due date;
(xxxvii)
To the best of the Seller’s knowledge, the servicer for each Mortgage Loan has
accurately and fully reported its borrower credit files to each of the credit
repositories in a timely manner;
(xxxviii)
No Mortgage Loan is subject to the Home Ownership and Equity Protection Act
of
1994 (“HOEPA”) or any comparable law and no Mortgage Loan is classified and/or
defined as a “high cost”, “covered”, (excluding home loans defined as “covered
home loans” in the New Jersey Home Ownership Security Act of 2002 that were
originated between November 26, 2003 and July 7, 2004), “high risk home” or
“predatory” loan under any other state, federal or local law or regulation or
ordinance (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);
(xxxix) No
Mortgage Loan was selected from the mortgage loans in the Seller’s portfolio in
a manner so as to affect adversely the interests of the Purchaser;
(xl) Each
Mortgage File contains a full appraisal on form 1004 or 2055 with an interior
inspection (or the equivalent form for two-to four-family and investor
properties), or on a similar alternate form which includes substantially
similar
information to that required such forms, as applicable;
(xli) Each
Mortgage Loan is and will be a mortgage loan arising out of the originator’s
practice in accordance with the originator’s underwriting
guidelines;
(xlii)
As of
the Closing Date, the Seller has no knowledge of any fact that should lead
it to
expect that the Mortgage Loan will not be paid in full when due;
(xliii) No
Mortgage Loan is a “high cost loan” or a “covered loan”, as applicable (as such
terms are defined in the then current Standard & Poor’s LEVELS Version 5.7
Glossary Revised, Appendix E;
(xliv) No
Mortgage Loan originated on or after October 1, 2002 through March 6, 2003
is
governed by the Georgia Fair Lending Act;
(xlv) The
prepayment penalties included in the transaction are enforceable and were
originated in compliance with all applicable federal, state and local
laws;
(xlvi) The
information set forth in the applicable part of the Mortgage Loan Schedule
relating to the existence of a Prepayment Charge is complete, true and correct
in all material respects at the date or dates on which such information is
furnished respecting with such information is furnished, and each Prepayment
Charge is permissible and enforceable in accordance with its terms upon the
mortgagor's full and voluntary principal prepayment under applicable federal,
state or local law, except to the extent that: (1) the enforceability thereof
may be limited by bankruptcy, insolvency, moratorium, receivership and other
similar laws relating to creditors' rights; (2) the collectability thereof
may
be limited due to acceleration in connection with a foreclosure or other
involuntary prepayment; or (3) subsequent changes in applicable law may limit
or
prohibit enforceability thereof; and
(xlvii) Each
mortgage loan and prepayment penalty associated with the mortgage loan at
origination complied in all material respects with applicable local, state
and
federal laws, including, without limitation, usury, equal credit opportunity,
real estate settlement procedures, truth-in-lending and disclosure laws,
and the
consummation of the transactions contemplated hereby will not involve the
violation of any such laws.
SECTION
9. Repurchase
Obligation for Defective Documentation and for Breach of Representation and
Warranty.
(a) The
representations and warranties contained in Section 8 shall not be impaired
by
any review and examination of loan files or other documents evidencing or
relating to the Mortgage Loans or any failure on the part of the Seller or
the
Purchaser to review or examine such documents and shall inure to the benefit
of
any assignee, transferee or designee of the Purchaser, including the Trustee
for
the benefit of the Certificateholders. With respect to the representations
and
warranties contained herein as to which the Seller has no knowledge, if it
is
discovered that the substance of any such representation and warranty was
inaccurate as of the date such representation and warranty was made or deemed
to
be made, and such inaccuracy materially and adversely affects the value of
the
related Mortgage Loan or the interest therein of the Purchaser or the
Purchaser’s assignee, transferee or designee, then notwithstanding the lack of
knowledge by the Seller with respect to the substance of such representation
and
warranty being inaccurate at the time the representation and warranty was
made,
the Seller shall take such action described in the following paragraph in
respect of such Mortgage Loan.
Upon
discovery by the Seller, the Purchaser or any assignee, transferee or designee
of the Purchaser of any materially defective document in, or that any material
document was not transferred by the Seller (as listed on an exception report
attached to the initial certification prepared by the Custodian, on behalf
of
the Trustee), or of a breach of any of the representations and warranties
contained in Section 8 that materially and adversely affects the value of
any
Mortgage Loan or the interest therein of the Purchaser or the Purchaser’s
assignee, transferee or designee, the party discovering such breach shall
give
prompt written notice to the Seller. Within 365 days of its discovery or
its
receipt of notice of any such missing documentation that was not transferred
by
the Seller as described above, or of materially defective documentation,
or
within 120 days of any such breach of a representation and warranty, the
Seller
promptly shall deliver such missing document or cure such defect or breach
in
all material respects or, in the event the Seller cannot deliver such missing
document or cannot cure such defect or breach, the Seller shall, within 365
days
of its discovery or receipt of notice of any such missing or materially
defective documentation or within 120 days of any such breach of a
representation and warranty, either (i) repurchase the affected Mortgage
Loan at
the Purchase Price (as such term is defined in the Pooling and Servicing
Agreement) or (ii) pursuant to the provisions of the Pooling and Servicing
Agreement, cause the removal of such Mortgage Loan from the Trust Fund and
substitute one or more Replacement Mortgage Loans. The Seller shall amend
the
Closing Schedule to reflect the withdrawal of such Mortgage Loan from the
terms
of this Agreement and the Pooling and Servicing Agreement. The Seller shall
deliver to the Purchaser such amended Closing Schedule and shall deliver
such
other documents as are required by this Agreement or the Pooling and Servicing
Agreement within five (5) days of any such amendment. Any repurchase pursuant
to
this Section 9(a) shall be accomplished by transfer to an account designated
by
the Purchaser of the amount of the Purchase Price in accordance with Section
2.03 of the Pooling and Servicing Agreement. Any repurchase required by this
Section shall be made in a manner consistent with Section 2.03 of the Pooling
and Servicing Agreement.
(b) If
the
representation made by the Seller in Section 7(xiii) is breached, the Seller
shall not have the right or obligation to cure, substitute or repurchase
the
affected Mortgage Loan but shall remit to the Servicer servicing such Mortgage
Loan for deposit in the Collection Account, prior to the next succeeding
Servicer Remittance Date, the amount of the Prepayment Charge indicated on
the
applicable part of the Mortgage Loan Schedule to be due from the Mortgagor
in
the circumstances less any amount collected and remitted to such Servicer
for
deposit into the Collection Account.
(c) It
is
understood and agreed that the obligations of the Seller set forth in this
Section 9 to cure or repurchase a defective Mortgage Loan (and to make payments
pursuant to Section 9(b)) constitute the sole remedies of the Purchaser against
the Seller respecting a missing document or a breach of the representations
and
warranties contained in Section 8.
SECTION
10. Closing;
Payment for the Mortgage Loans. The
closing of the purchase and sale of the Mortgage Loans shall be held at the
New
York City office of Xxxxxxx Xxxxxxxx & Xxxx llp
at 10:00
a.m. New York City time on the Closing Date.
The
closing shall be subject to each of the following conditions:
(a) All
of
the representations and warranties of the Seller under this Agreement shall
be
true and correct in all material respects as of the date as of which they
are
made and no event shall have occurred which, with notice or the passage of
time,
would constitute a default under this Agreement;
(b) The
Purchaser shall have received, or the attorneys of the Purchaser shall have
received in escrow (to be released from escrow at the time of closing), all
Closing Documents as specified in Section 11 of this Agreement, in such forms
as
are agreed upon and acceptable to the Purchaser, duly executed by all
signatories other than the Purchaser as required pursuant to the respective
terms thereof;
(c) The
Seller shall have delivered or caused to be delivered and released to the
Purchaser or to its designee, all documents (including without limitation,
the
Mortgage Loans) required to be so delivered by the Purchaser pursuant to
Section
2.01 of the Pooling and Servicing Agreement; and
(d) All
other
terms and conditions of this Agreement and the Pooling and Servicing Agreement
shall have been complied with.
Subject
to the foregoing conditions, the Purchaser shall deliver or cause to be
delivered to the Seller on the Closing Date, against delivery and release
by the
Seller to the Trustee of all documents required pursuant to the Pooling and
Servicing Agreement, the consideration for the Mortgage Loans as specified
in
Section 3 of this Agreement.
SECTION
11. Closing
Documents.
Without
limiting the generality of Section 8 hereof, the closing shall be subject
to
delivery of each of the following documents:
(a) An
Officers’ Certificate of the Seller, dated the Closing Date, upon which the
Purchaser and the Underwriters may rely with respect to certain facts regarding
the sale of the Mortgage Loans by the Seller to the Purchaser;
(b) An
Opinion of Counsel of the Seller, dated the Closing Date and addressed to
the
Purchaser and the Underwriters;
(c) Such
opinions of counsel as the Rating Agencies or the Trustee may request in
connection with the sale of the Mortgage Loans by the Seller to the Purchaser
or
the Seller’s execution and delivery of, or performance under, this Agreement;
and
(d) Such
further information, certificates, opinions and documents as the Purchaser
or
the Underwriters may reasonably request.
SECTION
12. Costs.
The
Seller shall pay (or shall reimburse the Purchaser or any other Person to
the
extent that the Purchaser or such other Person shall pay) all costs and expenses
incurred in connection with the transfer and delivery of the Mortgage Loans,
including without limitation, fees for title policy endorsements and
continuations, the fees and expenses of the Seller’s accountants and attorneys,
the costs and expenses incurred in connection with producing the Servicer’s loan
loss, foreclosure and delinquency experience, and the costs and expenses
incurred in connection with obtaining the documents referred to in Sections
11(b) and 11(c), the costs and expenses of printing (or otherwise reproducing)
and delivering this Agreement, the Pooling and Servicing Agreement, the
Certificates, the prospectus and prospectus supplement, and any private
placement memorandum relating to the Certificates and other related documents,
the initial fees, costs and expenses of the Trustee and its counsel, the
fees
and expenses of the Purchaser’s counsel in connection with the preparation of
all documents relating to the securitization of the Mortgage Loans, the filing
fee charged by the Securities and Exchange Commission for registration of
the
Certificates and the fees charged by any rating agency to rate the Certificates.
The Seller shall pay all costs and expenses related to recording the Assignments
of Mortgage. All other costs and expenses in connection with the transactions
contemplated hereunder shall be borne by the party incurring such
expense.
SECTION
13. Mandatory
Delivery; Grant of Security Interest.
The
sale and delivery on the Closing Date of the Mortgage Loans described on
the
Mortgage Loan Schedule in accordance with the terms and conditions of this
Agreement is mandatory. It is specifically understood and agreed that each
Mortgage Loan is unique and identifiable on the date hereof and that an award
of
money damages would be insufficient to compensate the Purchaser for the losses
and damages incurred by the Purchaser in the event of the Seller’s failure to
deliver the Mortgage Loans on or before the Closing Date. The Seller hereby
grants to the Purchaser a lien on and a continuing security interest in the
Seller’s interest in each Mortgage Loan and each document and instrument
evidencing each such Mortgage Loan to secure the performance by the Seller
of
its obligation hereunder, and the Seller agrees that it holds such Mortgage
Loans in custody for the Purchaser, subject to the Purchaser’s (i) right, prior
to the Closing Date, to reject any Mortgage Loan to the extent permitted
by this
Agreement and (ii) obligation to deliver or cause to be delivered the
consideration for the Mortgage Loans pursuant to Section 3 hereof. Any Mortgage
Loans rejected by the Purchaser shall concurrently therewith be released
from
the security interest created hereby. All rights and remedies of the Purchaser
under this Agreement are distinct from, and cumulative with, any other rights
or
remedies under this Agreement or afforded by law or equity and all such rights
and remedies may be exercised concurrently, independently or
successively.
Notwithstanding
the foregoing, if on the Closing Date, each of the conditions set forth in
Section 10 hereof shall have been satisfied and the Purchaser shall not have
paid or caused to be paid the Purchase Price, or any such condition shall
not
have been waived or satisfied and the Purchaser determines not to pay or
cause
to be paid the Purchase Price, the Purchaser shall immediately effect the
redelivery of the Mortgage Loans, if delivery to the Purchaser has occurred,
and
the security interest created by this Section 13 shall be deemed to have
been
released.
SECTION
14. Notices.
All
demands, notices and communications hereunder shall be in writing and shall
be
deemed to have been duly given if personally delivered to or mailed by
registered mail, postage prepaid, or transmitted by fax and, receipt of which
is
confirmed by telephone, if to the Purchaser, addressed to the Purchaser at
Two
World Xxxxxxxxx Xxxxxx, Xxxxxxxx X, 00xx
Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, fax: (000) 000-0000, Attention: Legal Department
(NAAC
2006-AR3), or such other address as may hereafter be furnished to the Seller
in
writing by the Purchaser; and if to the Seller, addressed to the Seller at
Two
World Xxxxxxxxx Xxxxxx, Xxxxxxxx X, 00xx
Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, fax: (000) 000-0000, Attention: Xxxxx Xxxxxx, or
to
such other address as the Seller may designate in writing to the
Purchaser.
SECTION
15. Severability
of Provisions.
Any
part, provision, representation or warranty of this Agreement that is prohibited
or that is held to be void or unenforceable shall be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions hereof. Any part, provision, representation or warranty of this
Agreement that is prohibited or unenforceable or is held to be void or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating
the
remaining provisions hereof, and any such prohibition or unenforceability
in any
jurisdiction as to any Mortgage Loan shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent permitted
by applicable law, the parties hereto waive any provision of law which prohibits
or renders void or unenforceable any provision hereof.
SECTION
16. Agreement
of Parties.
The
Seller and the Purchaser each agree to execute and deliver such instruments
and
take such actions as either of the others may, from time to time, reasonably
request in order to effectuate the purpose and to carry out the terms of
this
Agreement and the Pooling and Servicing Agreement.
SECTION
17. Survival.
The
Seller agrees that the representations, warranties and agreements made by
it
herein and in any certificate or other instrument delivered pursuant hereto
shall be deemed to be relied upon by the Purchaser, notwithstanding any
investigation heretofore or hereafter made by the Purchaser or on its behalf,
and that the representations, warranties and agreements made by the Seller
herein or in any such certificate or other instrument shall survive the delivery
of and payment for the Mortgage Loans and shall continue in full force and
effect, notwithstanding any restrictive or qualified endorsement on the Mortgage
Notes and notwithstanding subsequent termination of this Agreement, the Pooling
and Servicing Agreement or the Trust Fund.
SECTION
18. GOVERNING
LAW.
THIS AGREEMENT AND THE RIGHTS, DUTIES, OBLIGATIONS AND RESPONSIBILITIES OF
THE
PARTIES HERETO SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS
(EXCLUDING THE CHOICE OF LAW PROVISIONS) AND DECISIONS OF THE STATE OF NEW
YORK.
THE PARTIES HERETO INTEND THAT THE PROVISIONS OF SECTION 5-1401 OF THE NEW
YORK
GENERAL OBLIGATIONS LAW SHALL GOVERN.
SECTION
19. Miscellaneous.
This
Agreement may be executed in two or more counterparts, each of which when
so
executed and delivered shall be an original, but all of which together shall
constitute one and the same instrument. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective
successors and assigns. This Agreement supersedes all prior agreements and
understandings relating to the subject matter hereof. Neither this Agreement
nor
any term hereof may be changed, waived, discharged or terminated orally,
but
only by an instrument in writing signed by the party against whom enforcement
of
the change, waiver, discharge or termination is sought. The headings in this
Agreement are for purposes of reference only and shall not limit or otherwise
affect the meaning hereof.
It
is the
express intent of the parties hereto that the conveyance of the Mortgage
Loans
by the Seller to the Purchaser as provided in Section 4 hereof be, and be
construed as, a sale of the Mortgage Loans by the Seller to the Purchaser
and
not as a pledge of the Mortgage Loans by the Seller to the Purchaser to secure
a
debt or other obligation of the Seller. However, in the event that,
notwithstanding the aforementioned intent of the parties, the Mortgage Loans
are
held to be property of the Seller, then (a) it is the express intent of the
parties that such conveyance be deemed a pledge of the Mortgage Loans by
the
Seller to the Purchaser to secure a debt or other obligation of the Seller
and
(b) (1) this Agreement shall also be deemed to be a security agreement within
the meaning of Articles 8 and 9 of the New York Uniform Commercial Code;
(2) the
conveyance provided for in Section 4 hereof shall be deemed to be a grant
by the
Seller to the Purchaser of a security interest in all of the Seller’s right,
title and interest in and to the Mortgage Loans and all amounts payable to
the
holders of the Mortgage Loans in accordance with the terms thereof and all
proceeds of the conversion, voluntary or involuntary, of the foregoing into
cash, instruments, securities or other property, including without limitation
all amounts, other than investment earnings, from time to time held or invested
in the Collection Account whether in the form of cash, instruments, securities
or other property; (3) the possession by the Purchaser or its agent of Mortgage
Notes, the related Mortgages and such other items of property that constitute
instruments, money, negotiable documents or chattel paper shall be deemed
to be
“possession by the secured party” for purposes of perfecting the security
interest pursuant to Section 9-305 of the New York Uniform Commercial Code;
and
(4) notifications to persons holding such property and acknowledgments, receipts
or confirmations from persons holding such property shall be deemed
notifications to, or acknowledgments, receipts or confirmations from, financial
intermediaries, bailees or agents (as applicable) of the Purchaser for the
purpose of perfecting such security interest under applicable law. Any
assignment of the interest of the Purchaser pursuant to Section 4(d) hereof
shall also be deemed to be an assignment of any security interest created
hereby. The Seller and the Purchaser shall, to the extent consistent with
this
Agreement, take such actions as may be necessary to ensure that, if this
Agreement were deemed to create a security interest in the Mortgage Loans,
such
security interest would be deemed to be a perfected security interest of
first
priority under applicable law and will be maintained as such throughout the
term
of this Agreement and the Pooling and Servicing Agreement.
[Signature
page to follow]
___________________
*
Please
contact Nomura Credit & Capital, Inc. for pricing
information
IN
WITNESS WHEREOF, the Purchaser and the Seller have caused their names to
be
signed by their respective officers thereunto duly authorized as of the date
first above written.
NOMURA
CREDIT
& CAPITAL, INC.
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||
|
|
|
By: /s/ Xxxxxxx X.X. Xxxxxxx | ||
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||
Name: Xxxxxxx
X.X. Xxxxxxx
Title: Vice
President
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NOMURA
ASSET
ACCEPTANCE CORPORATION
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||
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|
By: /s/ Xxxx X. Xxxxxx | ||
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||
Name:
Xxxx X. Xxxxxx
Title:
President
|
EXHIBIT
1
CONTENTS
OF MORTGAGE FILE
With
respect to each Mortgage Loan, the Mortgage File shall include each of the
following items, which shall be available for inspection by the Purchaser
or its
designee, and which shall be delivered to the Purchaser or its designee pursuant
to the terms of the Agreement.
(a) the
original Mortgage Note (including all riders thereto) bearing all intervening
endorsements necessary to show a complete chain of endorsements from the
original payee, endorsed in blank, via
original signature,
and, if
previously endorsed, signed in the name of the last endorsee by a duly qualified
officer of the last endorsee. If
the
Mortgage Loan was acquired by the last endorsee in a merger, the endorsement
must be by “[name of 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
“[name of last endorsee], formerly known as [previous name]”;
(b) the
original Assignment of Mortgage executed in blank;
(c) the
original of any guarantee executed in connection with the Mortgage Note,
if
any;
(d) the
original Mortgage (including all riders thereto) with evidence of recording
thereon and the original recorded power of attorney, if the Mortgage was
executed pursuant to a power of attorney, with evidence of recording thereon,
and in the case of each MOM Loan, the original Mortgage, noting the presence
of
the MIN of the Mortgage Loan and either language indicating that the Mortgage
Loan is a MOM Loan or if the Mortgage Loan was not a MOM Loan at origination,
the original Mortgage and the assignment thereof to MERS®, with evidence of
recording indicated thereon; or, if the original Mortgage with evidence of
recording thereon has not been returned by the public recording office where
such Mortgage has been delivered for recordation or such Mortgage has been
lost
or such public recording office retains the original recorded Mortgage, a
photocopy of such Mortgage, together with (i) in the case of a delay caused
by
the public recording office, an Officer’s Certificate of the title insurer
insuring the Mortgage, the escrow agent, the seller or the Servicer servicing
such Mortgage Loan stating that such Mortgage has been delivered to the
appropriate public recording office for recordation and that the original
recorded Mortgage or a copy of such Mortgage certified by such public recording
office to be a true and complete copy of the original recorded Mortgage will
be
promptly delivered to the Custodian upon receipt thereof by the party delivering
the Officer’s Certificate or by the Servicer; or (ii) in the case of a Mortgage
where a public recording office retains the original recorded Mortgage or
in the
case where a Mortgage is lost after recordation in a public recording office,
a
copy of such Mortgage with the recording information thereon certified by
such
public recording office to be a true and complete copy of the original recorded
Mortgage;
(e) the
originals of all assumption, modification, consolidation or extension
agreements, with evidence of recording thereon, if any;
(f) the
originals of any intervening assignments of mortgage with evidence of recording
thereon evidencing a complete chain of ownership from the originator of the
Mortgage Loan to the last assignee, or if any such intervening assignment
of
mortgage has not been returned from the applicable public recording office
or
has been lost or if such public recording office retains the original recorded
intervening assignments of mortgage, a photocopy of such intervening assignment
of mortgage, together with (i) in the case of a delay caused by the public
recording office, an Officer’s Certificate of the title insurer insuring the
Mortgage, the escrow agent, the seller or the Servicer servicing such Mortgage
Loan stating that such intervening assignment of mortgage has been delivered
to
the appropriate public recording office for recordation and that such original
recorded intervening assignment of mortgage or a copy of such intervening
assignment of mortgage certified by the appropriate public recording office
to
be a true and complete copy of the original recorded intervening assignment
of
mortgage will be promptly delivered to the Custodian upon receipt thereof
by the
party delivering the Officer’s Certificate or by the Servicer; or (ii) in the
case of an intervening assignment of mortgage where a public recording office
retains the original recorded intervening assignment of mortgage or in the
case
where an intervening assignment of mortgage is lost after recordation in
a
public recording office, a copy of such intervening assignment of mortgage
with
recording information thereon certified by such public recording office to
be a
true and complete copy of the original recorded intervening assignment of
mortgage;
(g) if
the
Mortgage Note, the Mortgage, any Assignment of Mortgage, or any other related
document has been signed by a Person on behalf of the Mortgagor, the original
power of attorney or other instrument that authorized and empowered such
Person
to sign;
(h) the
original lender’s title insurance policy in the form of an ALTA mortgage title
insurance policy
or,
if the
original lender’s title insurance policy has not been issued, the irrevocable
commitment to issue the same; and
(i) the
original of any security agreement, chattel mortgage or equivalent document
executed in connection with the Mortgage, if any.
EXHIBIT
2
FORM
OF LOST NOTE AFFIDAVIT
Loan
#:
______
Borrower:_____
LOST
NOTE
AFFIDAVIT
I,
as
_____________________ of ____________________, a _______________ am authorized
to make this Affidavit on behalf of Nomura Credit & Capital, Inc. (the
“Seller”). In connection with the administration of the Mortgage Loans held by
______________________, a _______________ [corporation] as Seller on behalf
of
____________________ (the “Purchaser”), _______________________ (the
“Deponent”), being duly sworn, deposes and says that:
1. The
Seller’s address is: ____________________________
____________________________
____________________________
2. The
Seller previously delivered to the Purchaser a signed Initial Certification
with
respect to such Mortgage and/or Assignment of Mortgage;
3. Such
Mortgage Note and/or Assignment of Mortgage was assigned or sold to the
Purchaser by __________________, a _________________ pursuant to the terms
and
provisions of a Mortgage Loan Purchase Agreement dated as of September 29,
2006;
4. Such
Mortgage Note and/or Assignment of Mortgage is not outstanding pursuant to
a
request for release of Documents;
5. Aforesaid
Mortgage Note and/or Assignment of Mortgage (the “Original”) has been
lost;
6. Deponent
has made or caused to be made a diligent search for the Original and has
been
unable to find or recover same;
7. The
Seller was the Seller of the Original at the time of the loss; and
8. Deponent
agrees that, if said Original should ever come into Seller’s possession, custody
or power, Seller will immediately and without consideration surrender the
Original to the Purchaser.
9. Attached
hereto is a true and correct copy of (i) the Note, endorsed in blank by the
Mortgagee and (ii) the Mortgage or Deed of Trust (strike one) which secures
the
Note, which Mortgage or Deed of Trust is recorded in the county where the
property is located.
10. Deponent
hereby agrees that the Seller (a) shall indemnify and hold harmless the
Purchaser, its successors and assigns, against any loss, liability or damage,
including reasonable attorney’s fees, resulting from the unavailability of any
Notes, including but not limited to any loss, liability or damage arising
from
(i) any false statement contained in this Affidavit, (ii) any claim of any
party
that purchased a mortgage loan evidenced by the Lost Note or any interest
in
such mortgage loan, (iii) any claim of any borrower with respect to the
existence of terms of a mortgage loan evidenced by the Lost Note on the related
property to the fact that the mortgage loan is not evidenced by an original
note
and (iv) the issuance of a new instrument in lieu thereof (items (i) through
(iv) above hereinafter referred to as the “Losses”) and (b) if required by any
Rating Agency in connection with placing such Lost Note into a Pass-Through
Transfer, shall obtain a surety from an insurer acceptable to the applicable
Rating Agency to cover any Losses with respect to such Lost Note.
11. This
Affidavit is intended to be relied upon by the Purchaser, its successors
and
assigns. Nomura Credit & Capital, Inc., represents and warrants that is has
the authority to perform its obligations under this Affidavit of Lost
Note.
Executed this _ day of _______, 200_. | ||
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|
|
By: | ||
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||
Name:
Title:
|
On
this
__ day of ______, 200_, before me appeared ______________________ to me
personally known, who being duly sworn did say that he is the
_______________________ of ____________________, a ______________________
and
that said Affidavit of Lost Note was signed and sealed on behalf of such
corporation and said acknowledged this instrument to be the free act and
deed of
said entity.
Signature:
[Seal]
EXHIBIT
D
TRANSFER
AFFIDAVIT AND AGREEMENT
STATE
OF NEW YORK
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)
|
|
)
|
ss.:
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|
COUNTY
OF NEW YORK
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)
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___________________________
being duly sworn, deposes, represents and warrants as follows:
1.
|
I
am a _____________________ of _______________________________ (the
“Investor”) a corporation duly organized and existing under the laws of
_________________________, the record owner of Nomura Asset Acceptance
Corporation, Alternative Loan Trust, Series 2006-AR3 Mortgage Pass-Through
Certificates, Class R[-X] Certificates (the “Class R[-X] Certificates”),
on behalf of whom I make this affidavit and agreement. Capitalized
terms
used but not defined herein have the respective meanings assigned
thereto
in the Pooling and Servicing Agreement pursuant to which the Class
R[-X]
Certificates were issued.
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2.
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The
Investor (i) is and will be a “Permitted Transferee” as of
____________________. ____ and (ii) is acquiring the Class R[-X]
Certificates for its own account or for the account of another
Investor
from which it has received an affidavit in substantially the same
form as
this affidavit. A “Permitted Transferee” is any person other than a
“disqualified organization” or a possession of the United States. For this
purpose, a “disqualified organization” means the United States, any state
or political subdivision thereof, any agency or instrumentality
of any of
the foregoing (other than an instrumentality all of the activities
of
which are subject to tax and, except for the Federal Home Loan
Mortgage
Corporation, a majority of whose board of directors is not selected
by any
such governmental entity) or any foreign government, international
organization or any agency or instrumentality of such foreign government
or organization, any real electric or telephone cooperative, or
any
organization (other than certain farmers’ cooperatives) that is generally
exempt from federal income tax unless such organization is subject
to the
tax on unrelated business taxable
income.
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3.
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The
Investor is aware (i) of the tax that would be imposed on transfers
of the
Class R[-X] Certificates to disqualified organizations under the
Internal
Revenue Code of 1986 that applies to all transfers of the Class
R[-X]
Certificates after July 31, 1988; (ii) that such tax would be on
the
transferor or, if such transfer is through an agent (which person
includes
a broker, nominee or middleman) for a non-Permitted Transferee,
on the
agent; (iii) that the person otherwise liable for the tax shall
be
relieved of liability for the tax if the transferee furnishes to
such
person an affidavit that the transferee is a Permitted Transferee
and, at
the time of transfer, such person does not have actual knowledge
that the
affidavit is false; and (iv) that each of the Class R[-X] Certificates
may
be a “noneconomic residual interest” within the meaning of proposed
Treasury regulations promulgated under the Code and that the transferor
of
a “noneconomic residual interest” will remain liable for any taxes due
with respect to the income on such residual interest, unless no
significant purpose of the transfer is to impede the assessment
or
collection of tax.
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4.
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The
Investor is aware of the tax imposed on a “pass-through entity” holding
the Class R[-X] Certificates if, at any time during the taxable
year of
the pass-through entity, a non-Permitted Transferee is the record
holder
of an interest in such entity. (For this purpose, a “pass-through entity”
includes a regulated investment company, a real estate investment
trust or
common trust fund, a partnership, trust or estate, and certain
cooperatives.)
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5.
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The
Investor is aware that the Securities Administrator will not register
the
transfer of any Class R[-X] Certificate unless the transferee,
or the
transferee’s agent, delivers to the Securities Administrator, among other
things, an affidavit in substantially the same form as this affidavit.
The
Investor expressly agrees that it will not consummate any such
transfer if
it knows or believes that any of the representations contained
in such
affidavit and agreement are false.
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6.
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The
Investor consents to any additional restrictions or arrangements
that
shall be deemed necessary upon advice of counsel to constitute
a
reasonable arrangement to ensure that the Class R[-X] Certificates
will
only be owned, directly or indirectly, by an Investor that is a
Permitted
Transferee.
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7.
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The
Investor’s taxpayer identification number is
________________.
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8.
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The
Investor has reviewed the restrictions set forth on the face of
the Class
R[-X] Certificates and the provisions of Section 6.02(c) of the
Pooling
and Servicing Agreement under which the Class R[-X] Certificates
were
issued (in particular, clauses (iii)(A) and (iii)(B) of Section
6.02(d)
which authorize the Securities Administrator to deliver payments
to a
person other than the Investor and negotiate a mandatory sale by
the
Securities Administrator in the event that the Investor holds such
Certificate in violation of Section 6.02(c)); and that the Investor
expressly agrees to be bound by and to comply with such restrictions
and
provisions.
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9.
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The
Investor is not acquiring and will not transfer the Class R[-X]
Certificates in order to impede the assessment or collection of
any
tax.
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10.
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The
Investor anticipates that it will, so long as it holds the Class
R[-X]
Certificates, have sufficient assets to pay any taxes owed by the
holder
of such Class R[-X] Certificates, and hereby represents to and
for the
benefit of the person from whom it acquired the Class R[-X] Certificates
that the Investor intends to pay taxes associated with holding
such Class
R[-X] Certificates as they become due, fully understanding that
it may
incur tax liabilities in excess of any cash flows generated by
the Class
R[-X] Certificates.
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11.
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The
Investor has no present knowledge that it may become insolvent
or subject
to a bankruptcy proceeding for so long as it holds the Class R[-X]
Certificates.
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12.
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The
Investor has no present knowledge or expectation that it will be
unable to
pay any United States taxes owed by it so long as any of the Certificates
remain outstanding.
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13.
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The
Investor is not acquiring the Class R[-X] Certificates with the
intent to
transfer the Class R Certificates to any person or entity that
will not
have sufficient assets to pay any taxes owed by the holder of such
Class
R[-X] Certificates, or that may become insolvent or subject to
a
bankruptcy proceeding, for so long as the Class R[-X] Certificates
remain
outstanding.
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14.
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The
Investor will, in connection with any transfer that it makes of
the Class
R[-X] Certificates, obtain from its transferee the representations
required by Section 6.02(c) of the Pooling and Servicing Agreement
under
which the Class R[-X] Certificate were issued and will not consummate
any
such transfer if it knows, or knows facts that should lead it to
believe,
that any such representations are
false.
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15.
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The
Investor will, in connection with any transfer that it makes of
the Class
R[-X] Certificates, deliver to the Securities Administrator an
affidavit,
which represents and warrants that it is not transferring the Class
R[-X]
Certificates to impede the assessment or collection of any tax
and that it
has no actual knowledge that the proposed transferee: (i) has insufficient
assets to pay any taxes owed by such transferee as holder of the
Class
R[-X] Certificates; (ii) may become insolvent or subject to a bankruptcy
proceeding for so long as the Class R[-X] Certificates remains
outstanding; and (iii) is not a “Permitted
Transferee”.
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16.
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The
Investor is a citizen or resident of the United States, a corporation,
partnership or other entity created or organized in, or under the
laws of,
the United States or any political subdivision thereof, or an estate
or
trust whose income from sources without the United States may be
included
in gross income for United States federal income tax purposes regardless
of its connection with the conduct of a trade or business within
the
United States.
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17.
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The
Investor of the Class R[-X] Certificate, hereby agrees that in
the event
that the Trust Fund created by the Pooling and Servicing Agreement
is
terminated pursuant to Section 10.01 thereof, the undersigned shall
assign
and transfer to the Holders of the Class X and the Class P Certificates
any amounts in excess of par received in connection with such termination.
Accordingly, in the event of such termination, the Securities
Administrator is hereby authorized to withhold any such amounts
in excess
of par and to pay such amounts directly to the Holders of the Class
X and
the Class P Certificates. This agreement shall bind and be enforceable
against any successor, transferee or assigned of the undersigned
in the
Class R[-X] Certificate. In connection with any transfer of the
Class
R[-X] Certificate, the Investor shall obtain an agreement substantially
similar to this clause from any subsequent
owner.
|
IN
WITNESS WHEREOF, the Investor has caused this instrument to be executed on
its
behalf, pursuant to the authority of its Board of Directors, by its [Vice]
President, attested by its [Assistant] Secretary, this ____ day of
_________________, ____.
[INVESTOR]
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||
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|
|
By: | ||
|
||
Name:
Title:
[Vice] President
|
ATTEST:
By:
|
|||
|
|||
Name:
Title:
[Assistant] Secretary
|
Personally
appeared before me the above-named __________________, known or proved to
me to
be the same person who executed the foregoing instrument and to be a [Vice]
President of the Investor, and acknowledged to me that [he/she] executed
the
same as [his/her] free act and deed and the free act and deed of the
Investor.
Subscribed
and sworn before me this ______________ day of __________, ____.
Notary
Public
|
|
County
of _____________________________
|
|
State
of _______________________________
|
|
My
Commission expires:
|
FORM
OF
TRANSFEROR AFFIDAVIT
STATE
OF NEW YORK
|
)
|
|
)
|
ss.:
|
|
COUNTY
OF NEW YORK
|
)
|
_________________________,
being duly sworn, deposes, represents and warrants as follows:
1. I
am
a ____________________
of _________________________ (the “Investor”), a corporation duly organized and
existing under the laws of _____________, on behalf of whom I make this
affidavit.
2. The
Investor is not transferring the Class R[-X] Certificates (the “Residual
Certificates”) to impede the assessment or collection of any tax.
3. The
Investor has no actual knowledge that the Person that is the proposed transferee
(the “Purchaser”) of the Residual Certificates: (i) has insufficient assets to
pay any taxes owed by such proposed transferee as holder of the Residual
Certificates; (ii) may become insolvent or subject to a bankruptcy proceeding
for so long as the Residual Certificates remain outstanding and (iii) is
not a
Permitted Transferee.
4. The
Investor understands that the Purchaser has delivered to the Securities
Administrator a transfer affidavit and agreement in the form attached to
the
Pooling and Servicing Agreement as Exhibit D. The Investor does not know
or
believe that any representation contained therein is false.
5. At
the
time of transfer, the Investor has conducted a reasonable investigation of
the
financial condition of the Purchaser as contemplated by Treasury Regulations
Section 1.860E-1(c)(4)(i) and, as a result of that investigation, the Investor
has determined that the Purchaser has historically paid its debts as they
became
due and has found no significant evidence to indicate that the Purchaser
will
not continue to pay its debts as they become due in the future. The Investor
understands that the transfer of a Residual Certificate may not be respected
for
United States income tax purposes (and the Investor may continue to be liable
for United States income taxes associated therewith) unless the Investor
has
conducted such an investigation.
6. Capitalized
terms not otherwise defined herein shall have the meanings ascribed to them
in
the Pooling and Servicing Agreement dated as of September 1, 2006, among
Nomura
Asset Acceptance Corporation, Nomura Credit & Capital, Inc., GMAC Mortgage
Corporation, Xxxxx Fargo Bank, N.A. and HSBC Bank USA, National
Association.
IN
WITNESS WHEREOF, the Investor has caused this instrument to be executed on
its
behalf, pursuant to the authority of its Board of Directors, by its [Vice]
President, attested by its [Assistant] Secretary, this ____ day of
________________, ____.
[INVESTOR]
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||
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|
|
By: | ||
|
||
Name:
Title:
[Vice] President
|
ATTEST:
By:
|
|||
|
|||
Name:
Title:
[Assistant] Secretary
|
Personally
appeared before me the above-named _________________, known or proved to
me to
be the same person who executed the foregoing instrument and to be a [Vice]
President of the Investor, and acknowledged to me that [he/she] executed
the
same as [his/her] free act and deed and the free act and deed of the
Investor.
Subscribed
and sworn before me this ______ day of _____________, ____.
Notary
Public
|
|
County
of _____________________________
|
|
State
of _______________________________
|
|
My
Commission expires:
|
Personally
appeared before me the above-named [Name of Officer], known or proved to
me to
be the same person who executed the foregoing instrument and to be the [Title
of
Officer] of the Investor, and acknowledged to me that he/she executed the
same
as his/her free act and deed and the free act and deed of the
Investor.
Subscribed
and sworn before me this ___ day of _________, 20___.
NOTARY
PUBLIC
COUNTY
OF
STATE
OF
My
commission expires the ___ day of ___________________, 20___.
EXHIBIT
E
FORM
OF TRANSFEROR CERTIFICATE
______________,
2006
Nomura
Asset Acceptance Corporation
2
World
Xxxxxxxxx Xxxxxx, Xxxxxxxx X
Xxx
Xxxx,
Xxx Xxxx 00000
Xxxxx
Fargo Bank, N.A.
Xxxxx
Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx,
Xxxxxxxxx 00000
Re:
|
Nomura
Asset Acceptance Corporation
Mortgage
Pass-Through Certificates, Series 2006-AR3, Class
[X][P][R][R-X]
|
Ladies
and Gentlemen:
In
connection with the sale by ___________ (the “Sponsor”) to ________ (the
“Purchaser”) of $_________ Initial Certificate Principal Balance of Mortgage
Pass-Through Certificates, Series 2006-AR3, Class [X][P][R][R-X] (the
“Certificates”), issued pursuant to the Pooling and Servicing Agreement (the
“Pooling and Servicing Agreement”), dated as of September 1, 2006, among Nomura
Asset Acceptance Corporation, as depositor (the “Depositor”), Nomura Credit
& Capital, Inc., as sponsor, GMAC Mortgage Corporation, as a servicer, Xxxxx
Fargo Bank, N.A., as master servicer (the “Master Servicer”) and securities
administrator (the “Securities Administrator”) and HSBC Bank USA, National
Association, as trustee (the “Trustee”). The Sponsor hereby certifies,
represents and warrants to, a covenants with, the Depositor, the Securities
Administrator and the Trustee that:
Neither
the Sponsor nor anyone acting on its behalf has (a) offered, pledged, sold,
disposed of or otherwise transferred any Certificate, any interest in any
Certificate or any other similar security to any person in any manner, (b)
has
solicited any offer to buy or to accept a pledge, disposition or other transfer
of any Certificate, any interest in any Certificate or any other similar
security from any person in any manner, (c) has otherwise approached or
negotiated with respect to any Certificate, any interest in any Certificate
or
any other similar security with any person in any manner, (d) has made any
general solicitation by means of general advertising or in any other manner,
or
(e) has taken any other action, that (as to any of (a) through (e) above)
would
constitute a distribution of the Certificates under the Securities Act of
1933
(the “Act”), that would render the disposition of any Certificate a violation of
Section 5 of the Act or any state securities law, or that would require
registration or qualification pursuant thereto. The Sponsor will not act
in any
manner set forth in the foregoing sentence with respect to any Certificate.
The
Sponsor has not and will not sell or otherwise transfer any of the Certificates,
except in compliance with the provisions of the Pooling and Servicing
Agreement.
Very
truly yours,
|
||||||||
___________________________________________
|
||||||||
(Sponsor)
|
||||||||
By:
|
||||||||
Name:
|
||||||||
Title:
|
EXHIBIT
F
FORM
OF INVESTOR REPRESENTATION LETTER (NON-RULE 144A)
___________,
2006
Nomura
Asset Acceptance Corporation
2
World
Financial Center
New
York,
New York 10281
Xxxxx
Fargo Bank, N.A.
Xxxxx
Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx,
Xxxxxxxxx 00000
Re:
|
Nomura
Asset Acceptance Corporation, Alternative Loan Trust, Mortgage
Pass-Through Certificates, Series
2006-AR3
|
Ladies
and Gentlemen:
_______________
(the “Purchaser”) intends to purchase from ____________ (the “Sponsor”)
$_________ Initial Certificate Principal Balance of Mortgage Pass-Through
Certificates, Series 2006-AR3, Class [X][P][R][R-X] (the “Certificates”), issued
pursuant to the Pooling and Servicing Agreement (the “Pooling and Servicing
Agreement”), dated as of September 1, 2006, among Nomura Asset Acceptance
Corporation, as depositor (the “Depositor”), Nomura Credit & Capital, Inc.,
as sponsor, GMAC Mortgage Corporation, as a servicer, Xxxxx Fargo Bank, N.A.,
as
master servicer (the “Master Servicer”) and securities administrator (the
“Securities Administrator”) and HSBC Bank USA, National Association, as trustee
(the “Trustee”). All terms used herein and not otherwise defined shall have the
meanings set forth in the Pooling and Servicing Agreement. The Purchaser
hereby
certifies, represents and warrants to, and covenants with, the Depositor,
the
Securities Administrator and the Trustee that:
1.
|
The
Purchaser understands that (a) the Certificates have not been and
will not
be registered or qualified under the Securities Act of 1933, as
amended
(the “Act”) or any state securities law, (b) the Depositor is not required
to so register or qualify the Certificates, (c) the Certificates
may be
resold only if registered and qualified pursuant to the provisions
of the
Act or any state securities law, or if an exemption from such registration
and qualification is available, (d) the Pooling and Servicing Agreement
contains restrictions regarding the transfer of the Certificates
and (e)
the Certificates will bear a legend to the foregoing effect.
|
|
2.
|
The
Purchaser is acquiring the Certificates for its own account for
investment
only and not with a view to or for sale in connection with any
distribution thereof in any manner that would violate the Act or
any
applicable state securities laws.
|
|
3.
|
The
Purchaser is (a) a substantial, sophisticated institutional investor
having such knowledge and experience in financial and business
matters,
and, in particular, in such matters related to securities similar
to the
Certificates, such that it is capable of evaluating the merits
and risks
of investment in the Certificates, (b) able to bear the economic
risks of
such an investment and (c) an “accredited investor” within the meaning of
Rule 501 (a) promulgated pursuant to the Act.
|
|
4.
|
The
Purchaser has been furnished with, and has had an opportunity to
review
(a) a copy of the Pooling and Servicing Agreement and (b) such
other
information concerning the Certificates, the Mortgage Loans and
the
Depositor as has been requested by the Purchaser from the Depositor
or the
Sponsor and is relevant to the Purchaser’s decision to purchase the
Certificates. The Purchaser has had any questions arising from
such review
answered by the Depositor or the Sponsor to the satisfaction of
the
Purchaser.
|
|
5.
|
The
Purchaser has not and will not nor has it authorized or will it
authorize
any person to (a) offer, pledge, sell, dispose of or otherwise
transfer
any Certificate, any interest in any Certificate or any other similar
security to any person in any manner, (b) solicit any offer to
buy or to
accept a pledge, disposition of other transfer of any Certificate,
any
interest in any Certificate or any other similar security from
any person
in any manner, (c) otherwise approach or negotiate with respect
to any
Certificate, any interest in any Certificate or any other similar
security
with any person in any manner, (d) make any general solicitation
by means
of general advertising or in any other manner or (e) take any other
action, that (as to any of (a) through (e) above) would constitute
a
distribution of any Certificate under the Act, that would render
the
disposition of any Certificate a violation of Section 5 of the
Act or any
state securities law, or that would require registration or qualification
pursuant thereto. The Purchaser will not sell or otherwise transfer
any of
the Certificates, except in compliance with the provisions of the
Pooling
and Servicing Agreement.
|
Very
truly yours,
|
||||||||
___________________________________________
|
||||||||
(Purchaser)
|
||||||||
By:
|
||||||||
Name:
|
||||||||
Title:
|
EXHIBIT
G
FORM
OF RULE 144A INVESTMENT LETTER
[Date]
Nomura
Credit & Capital, Inc.
2
World
Financial Xxxxxx, Xxxxxxxx X
Xxx
Xxxx,
Xxx Xxxx 00000
Nomura
Asset Acceptance Corporation
2
World
Financial Center
New
York,
New York 10281
Xxxxx
Fargo Bank, N.A.
Xxxxx
Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx,
Xxxxxxxxx 00000
Re:
|
Nomura
Asset Acceptance Corporation, Alternative Loan Trust, Mortgage
Pass-Through Certificates, Series 2006-AR3 (the “Certificates”), including
the Class [X][P][R][R-X] Certificates (the “Private
Certificates”)
|
Dear
Ladies and Gentlemen:
In
connection with our purchase of Private Certificates, we confirm
that:
(i)
|
we
understand that the Private Certificates are not being registered
under
the Securities Act of 1933, as amended (the “Act”) or any applicable state
securities or “Blue Sky” laws, and are being sold to us in a transaction
that is exempt from the registration requirements of such
laws;
|
|
(ii)
|
any
information we desired concerning the Certificates, including the
Private
Certificates, the trust in which the Certificates represent the
entire
beneficial ownership interest (the “Trust”) or any other matter we deemed
relevant to our decision to purchase Private Certificates has been
made
available to us;
|
|
(iii)
|
we
are able to bear the economic risk of investment in Private Certificates;
we are an institutional “accredited investor” as defined in Section 501(a)
of Regulation D promulgated under the Act and a sophisticated
institutional investor and we agree to obtain a representation
from any
transferee that such transferee is an institutional “accredited investor”
so long as we are required to obtain a representation letter regarding
compliance with the Act;
|
|
(iv)
|
we
are acquiring Private Certificates for our own account, not as
nominee for
any other person, and not with a present view to any distribution
or other
disposition of the Private Certificates;
|
|
(v)
|
we
agree the Private Certificates must be held indefinitely by us
(and may
not be sold, pledged, hypothecated or in any way disposed of) unless
subsequently registered under the Act and any applicable state
securities
or “Blue Sky” laws or an exemption from the registration requirements of
the Act and any applicable state securities or “Blue Sky” laws is
available;
|
|
(vi)
|
we
agree that in the event that at some future time we wish to dispose
of or
exchange any of the Private Certificates (such disposition or exchange
not
being currently foreseen or contemplated), we will not transfer
or
exchange any of the Private Certificates unless:
|
|
(A)
(1) the sale is to an Eligible Purchaser (as defined below), (2)
if
required by the Pooling and Servicing Agreement (as defined below)
a
letter to substantially the same effect as either this letter or,
if the
Eligible Purchaser is a Qualified Institutional Buyer as defined
under
Rule 144A of the Act, the Rule 144A and Related Matters Certificate
in the
form attached to the Pooling and Servicing Agreement (as defined
below)
(or such other documentation as may be acceptable to the Securities
Administrator) is executed promptly by the purchaser and delivered
to the
addressees hereof and (3) all offers or solicitations in connection
with
the sale, whether directly or through any agent acting on our behalf,
are
limited only to Eligible Purchasers and are not made by means of
any form
of general solicitation or general advertising whatsoever;
and
|
||
(B)
if the Private Certificate is not registered under the Act (as
to which we
acknowledge you have no obligation), the Private Certificate is
sold in a
transaction that does not require registration under the Act and
any
applicable state securities or “blue sky” laws and, if the Securities
Administrator or HSBC Bank USA, National Association, as trustee
(the
“Trustee”) so requests, a satisfactory Opinion of Counsel is furnished to
such effect, which Opinion of Counsel shall be an expense of the
transferor or the transferee;
|
||
(vii)
|
we
agree to be bound by all of the terms (including those relating
to
restrictions on transfer) of the Pooling and Servicing, pursuant
to which
the Trust was formed; we have reviewed carefully and understand
the terms
of the Pooling and Servicing Agreement;
|
|
(viii)
|
we
either: (i) are not acquiring the Privately Offered Certificate
directly
or indirectly by, or on behalf of, an employee benefit plan or
other
retirement arrangement which is subject to Title I of the Employee
Retirement Income Security Act of 1974, as amended, and/or section
4975 of
the Internal Revenue Code of 1986, as amended, or (ii) in the case
of a
Class X, Class P or Class R Certificate, are providing the opinion
of
counsel specified in Section 6.02(b) of the Agreement.
|
|
(ix)
|
we
understand that each of the Class [X][P][R][-X] Certificates bears,
and
will continue to bear, legends substantially to the following effect:
“THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY
STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE,
AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED
OR
OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT
AND OTHER
APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES
ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A
“QIB”),
PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT
OF A
QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER,
RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A,
(2)
PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144
UNDER THE
SECURITIES ACT (IF AVAILABLE) OR (3) IN CERTIFICATED FORM TO AN
“INSTITUTIONAL ACCREDITED INVESTOR” WITHIN THE MEANING THEREOF IN RULE
501(a)(1), (2), (3) or (7) OF REGULATION D UNDER THE ACT OR ANY
ENTITY IN
WHICH ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS PURCHASING
NOT
FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO
(A) THE
RECEIPT BY THE SECURITIES ADMINISTRATOR OF A LETTER SUBSTANTIALLY
IN THE
FORM PROVIDED IN THE AGREEMENT AND (B) THE RECEIPT BY THE SECURITIES
ADMINISTRATOR OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE SECURITIES
ADMINISTRATOR THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS
IN
COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR
IN EACH
CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED
STATES AND ANY OTHER APPLICABLE JURISDICTION.
|
|
NO TRANSFER
OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE TRANSFEREE
PROVIDES A CERTIFICATION PURSUANT TO SECTION 6.02(b) OF THE AGREEMENT
|
“Eligible
Purchaser”
means
a
corporation, partnership or other entity which we have reasonable grounds
to
believe and do believe (i) can make representations with respect to itself
to
substantially the same effect as the representations set forth herein, and
(ii)
is either a Qualified Institutional Buyer as defined under Rule 144A of the
Act
or an institutional “Accredited Investor” as defined under Rule 501 of the
Act.
Terms
not
otherwise defined herein shall have the meanings assigned to them in the
Pooling
and Servicing Agreement, dated as of September 1, 2006, between Nomura Asset
Acceptance Corporation, as depositor, Nomura Credit & Capital, Inc., as
sponsor, GMAC Mortgage Corporation, as a servicer, Xxxxx Fargo Bank, N.A.,
as
master servicer (the “Master Servicer”) and securities administrator (the
“Securities Administrator”) and HSBC Bank USA, National Association, as trustee
(the “Trustee”) (the “Pooling and Servicing Agreement’).
If
the
Purchaser proposes that its Certificates be registered in the name of a nominee
on its behalf, the Purchaser has identified such nominee below, and has caused
such nominee to complete the Nominee Acknowledgment at the end of this
letter.
Name
of
Nominee (if any): _______________________________
IN
WITNESS WHEREOF, this document has been executed by the undersigned who is
duly
authorized to do so on behalf of the undersigned Eligible Purchaser on the
___
day of ________, 20___.
Very
truly yours,
|
||||||||
[PURCHASER]
|
||||||||
By:
|
||||||||
(Authorized
Officer)
|
||||||||
[By:__________________________________
|
||||||||
Attorney-in-fact]
|
Nominee
Acknowledgment
The
undersigned hereby acknowledges and agrees that as to the Certificates being
registered in its name, the sole beneficial owner thereof is and shall be
the
Purchaser identified above, for whom the undersigned is acting as
nominee.
[NAME
OF NOMINEE]
|
||||||||
By:
|
||||||||
(Authorized
Officer)
|
||||||||
[By:__________________________________
|
||||||||
Attorney-in-fact]
|
EXHIBIT
H
FORM
OF ADDITIONAL DISCLOSURE NOTIFICATION
Xxxxx
Fargo Bank, N.A. as Securities Administrator
0000
Xxx
Xxxxxxxxx Xxxx
Xxxxxxxx,
Xxxxxxxx 00000-0000
Fax:
(000) 000-0000
E-mail:
xxx.xxx.xxxxxxxxxxxxx@xxxxxxxxxx.xxx
Nomura
Asset Acceptance Corporation
2
World
Xxxxxxxxx Xxxxxx, Xxxxxxxx X
Xxx
Xxxx,
Xxx Xxxx 00000
Attn: |
Corporate
Trust Services - Nomura Asset Acceptance Corporation, Alternative
Loan
Trust,
Series 2006-AR3, Mortgage Pass-Through Certificates -SEC REPORT
PROCESSING
|
RE:
**Additional Form [10-K][10-D][8-K] Disclosure**Required
Ladies
and Gentlemen:
In
accordance with Section [ ] of the Pooling and Servicing Agreement, dated
as of
September 1, 2006, among the Purchaser as depositor, Nomura Credit &
Capital, Inc. as sponsor, GMAC Mortgage Corporation as a servicer, HSBC Bank
USA, National Association, as trustee and Xxxxx Fargo Bank, National Association
as master servicer and securities administrator, the Undersigned, as [ ],
hereby
notifies you that certain events have come to our attention that [will][may]
need to be disclosed on Form [10-K][10-D][8-K].
Description
of Additional Form [10-K][10-D][8-K]Disclosure:
List
of
Any Attachments hereto to be included in the Additional Form [10-K][10-D][8-K]
Disclosure:
Any
inquiries related to this notification should be directed to [ ],
phone number: [ ]; email address: [ ].
[NAME
OF PARTY]
as [role]
|
||
|
|
|
By: | ||
|
||
Name:
Title:
|
EXHIBIT
I
DTC
Letter of Representations
[provided
upon request]
EXHIBIT
J
Schedule
of Mortgage Loans with Lost Notes
NONE
EXHIBIT
K
APPENDIX
E - Standard & Poor’s Anti-Predatory Lending
Categorization
Standard
& Poor’s has categorized loans governed by anti-predatory lending laws in
the Jurisdictions listed below into three categories based upon a combination
of
factors that include (a) the risk exposure associated with the assignee
liability and (b) the tests and thresholds set forth in those laws. Note
that
certain loans classified by the relevant statute as Covered are included
in
Standard & Poor’s High Cost Loan Category because they included thresholds
and tests that are typical of what is generally considered High Cost by the
industry.
Standard
&
Poor’s
High Cost Loan
Categorization
State/Jurisdiction
|
Name
of Anti-Predatory Lending
Law/Effective
Date
|
Category
under
Applicable
Anti-
Predatory
Lending Law
|
Arkansas
|
Arkansas
Home Loan Protection Act, Ark. Code Xxx. §§ 00-00-000 et seq.
Effective
July 16, 2003
|
High
Cost Home Loan
|
Cleveland
Heights, OH
|
Ordinance
No. 72-2003 (PSH), Mun. Code §§ 757.01 et seq.
Effective
June 2, 2003
|
Covered
Loan
|
Colorado
|
Consumer
Equity Protection, Colo. Stat. Xxx. §§ 5-3.5-101 et seq.
Effective
for covered loans offered or entered into on or after January 1,
2003.
Other provisions of the Act took effect on June 7, 2002
|
Covered
Loan
|
Connecticut
|
Connecticut
Abusive Home Loan Lending Practices Act, Conn. Gen. Stat. §§ 36a-746
et seq.
Effective
October 1, 2001
|
High
Cost Home Loan
|
District
of Columbia
|
Home
Loan Protection Act, D.C. Code §§ 26-1151.01 et seq.
Effective
for loans closed on or after January 28, 2003
|
Covered
Loan
|
Florida
|
Fair
Lending Act, Fla. Stat. Xxx. §§ 494.0078 et seq.
Effective
October 2, 2002
|
High
Cost Home Loan
|
Standard
& Poor’s High Cost Loan Categorization
State/Jurisdiction
|
Name
of Anti-Predatory Lending
Law/Effective
Date
|
Category
under
Applicable
Anti-
Predatory
Lending Law
|
Georgia
(Oct. 1, 2002 - Mar. 6, 2003)
|
Georgia
Fair Lending Act, Ga. Code Xxx. §§ 7-6A-1 et seq.
Effective
October 1, 2002 - March 6, 2003
|
High
Cost Home Loan
|
Georgia
as amended (Mar. 7, 2003 - current)
|
Georgia
Fair Lending Act, Ga. Code Xxx. §§ 7-6A-1 et seq.
Effective
for loans closed on or after March 7, 2003
|
High
Cost Home Loan
|
HOEPA
Section 32
|
Home
Ownership and Equity Protection Act of 1994, 15 U.S.C. § 1639, 12 C.F.R.
§§ 226.32 and 226.34
Effective
October 1, 1995, amendments October 1, 2002
|
High
Cost Loan
|
Illinois
|
High
Risk Home Loan Act, Ill. Comp. Stat. tit. 815, §§ 137/5 et seq.
Effective
January 1, 2004 (prior to this date, regulations under Residential
Mortgage License Act effective from May 14, 2001)
|
High
Risk Home Loan
|
Kansas
|
Consumer
Credit Code, Kan. Stat. Xxx. §§ 16a-1-101 et seq.
Sections
16a-1-301 and 16a-3-207 became effective April 14, 1999; Section
16a-3-308a became effective July 1, 1999
|
High
Loan to Value Consumer Loan (id.§
16a-3-207) and;
|
High
APR Consumer Loan (id.§
16a-3-308a)
|
||
Kentucky
|
2003
KY H.B. 000 - Xxxx Xxxx Xxxx Xxxx Xxx, Xx. Rev. Stat. §§ 360.100
et seq.
Effective
June 24, 2003
|
High
Cost Home Loan
|
Maine
|
Truth
in Lending, Me. Rev. Stat. tit. 9-A, §§ 8-101 et seq.
Effective
September 29, 1995 and as amended from time to time
|
High
Rate High Fee Mortgage
|
Standard
& Poor’s High Cost Loan Categorization
State/Jurisdiction
|
Name
of Anti-Predatory Lending
Law/Effective
Date
|
Category
under
Applicable
Anti-
Predatory
Lending Law
|
Massachusetts
|
Part
40 and Part 32, 209 C.M.R. §§ 32.00 et seq.
and 209 C.M.R. §§ 40.01 et seq.
Effective
March 22, 2001 and amended from time to time
|
High
Cost Home Loan
|
Nevada
|
Assembly
Xxxx No. 284, Nev. Rev. Stat. §§ 598D.010 et seq.
Effective
October 1, 2003
|
Home
Loan
|
New
Jersey
|
New
Jersey Home Ownership Security Act of 2002, N.J. Rev. Stat. §§ 46:10B-22
et seq.
Effective
for loans closed on or after November 27, 2003
|
High
Cost Home Loan
|
New
Mexico
|
Home
Loan Protection Act, N.M. Rev. Stat. §§ 58-21A-1 et seq.
Effective
as of January 1, 2004; Revised as of February 26, 2004
|
High
Cost Home Loan
|
New
York
|
N.Y.
Banking Law Article 6-l
Effective
for applications made on or after April 1, 2003
|
High
Cost Home Loan
|
North
Carolina
|
Restrictions
and Limitations on High Cost Home Loans, N.C. Gen. Stat. §§ 24-1.1E
et seq.
Effective
July 1, 2000; amended October 1, 2003 (adding open-end lines of
credit)
|
High
Cost Home Loan
|
Ohio
|
H.B.
386 (codified in various sections of the Ohio Code), Ohio Rev.
Code Xxx.
§§ 1349.25 et seq.
Effective
May 24, 2002
|
Covered
Loan
|
Oklahoma
|
Consumer
Credit Code (codified in various sections of Title 14A)
Effective
July 1, 2000; amended effective January 1, 2004
|
Subsection
10 Mortgage
|
Standard
& Poor’s High Cost Loan Categorization
State/Jurisdiction
|
Name
of Anti-Predatory Lending
Law/Effective
Date
|
Category
under
Applicable
Anti-
Predatory
Lending Law
|
South
Carolina
|
South
Carolina High Cost and Consumer Home Loans Act, S.C. Code Xxx.
§§ 37-23-10
et seq.
Effective
for loans taken on or after January 1, 2004
|
High
Cost Home Loan
|
West
Virginia
|
West
Virginia Residential Mortgage Lender, Broker and Servicer Act,
W. Va. Code
Xxx. §§ 31-17-1 et seq.
Effective
June 5, 0000
|
Xxxx
Xxxxxxxx Mortgage Loan Act Loan
|
Standard
& Poor’s Covered Loan Categorization
State/Jurisdiction
|
Name
of Anti-Predatory Lending
Law/Effective
Date
|
Category
under
Applicable
Anti-
Predatory
Lending Law
|
Georgia
(Oct. 1, 2002 - Mar. 6, 2003)
|
Georgia
Fair Lending Act, Ga. Code Xxx. §§ 7-6A-1 et seq.
Effective
October 1, 2002 - March 6, 2003
|
Covered
Loan
|
New
Jersey
|
New
Jersey Home Ownership Security Act of 2002, N.J. Rev. Stat. §§ 46:10B-22
et seq.
Effective
November 27, 2003 - July 5, 2004
|
Covered
Home Loan
|
Standard
& Poor’s Home Loan Categorization
State/Jurisdiction
|
Name
of Anti-Predatory Lending
Law/Effective
Date
|
Category
under
Applicable
Anti-
Predatory
Lending Law
|
Georgia
(Oct. 1, 2002 - Mar. 6, 2003)
|
Georgia
Fair Lending Act, Ga. Code Xxx. §§ 7-6A-1 et seq.
Effective
October 1, 2002 - March 6, 2003
|
Home
Loan
|
New
Jersey
|
New
Jersey Home Ownership Security Act of 2002, N.J. Rev. Stat. §§ 46:10B-22
et seq.
Effective
for loans closed on or after November 27, 2003
|
Home
Loan
|
New
Mexico
|
Home
Loan Protection Act, N.M. Rev. Stat. §§ 58-21A-1 et seq.
Effective
as of January 1, 2004; Revised as of February 26, 2004
|
Home
Loan
|
North
Carolina
|
Restrictions
and Limitations on High Cost Home Loans, N.C. Gen. Stat. §§ 24-1.1E
et seq.
Effective
July 1, 2000; amended October 1, 2003 (adding open-end lines of
credit)
|
Consumer
Home Loan
|
South
Carolina
|
South
Carolina High Cost and Consumer Home Loans Act, S.C. Code Xxx.
§§ 37-23-10
et seq.
Effective
for loans taken on or after January 1, 2004
|
Consumer
Home Loan
|
EXHIBIT
L
SERVICING
CRITERIA
SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
Schedule
1122 (Pooling and Servicing Agreement)
Assessments
of Compliance and Attestation Reports Servicing Criteria1
Reg.
AB Item 1122(d) Servicing Criteria
|
Depositor
|
Sponsor
|
Servicer
|
Trustee
|
Custodian
|
Paying
Agent
|
Master
Servicer
|
Securities
Administrator
|
(1) General
Servicing Considerations
|
||||||||
(i) monitoring
performance or other triggers and events of default
|
X
|
X
|
X
|
|||||
(ii) monitoring
performance of vendors of activities outsourced
|
X
|
|||||||
(iii) maintenance
of back-up servicer for pool assets
|
||||||||
(iv) fidelity
bond and E&O policies in effect
|
X
|
X
|
||||||
(2) Cash
Collection and Administration
|
||||||||
(i) timing
of deposits to custodial account
|
X
|
X
|
X
|
X
|
||||
(ii) wire
transfers to investors by authorized personnel
|
X
|
X
|
X
|
|||||
(iii) advances
or guarantees made, reviewed and approved as required
|
X
|
X
|
||||||
(iv) accounts
maintained as required
|
X
|
X
|
X
|
X
|
||||
(v) accounts
at federally insured depository institutions
|
X
|
X
|
X
|
X
|
||||
(vi) unissued
checks safeguarded
|
X
|
X
|
X
|
|||||
(vii) monthly
reconciliations of accounts
|
X
|
X
|
X
|
X
|
||||
(3) Investor
Remittances and Reporting
|
||||||||
(i) investor
reports
|
X
|
X
|
X
|
X
|
||||
(ii) remittances
|
X
|
X
|
X
|
|||||
(iii) proper
posting of distributions
|
X
|
X
|
X
|
|||||
(iv) reconciliation
of remittances and payment statements
|
X
|
X
|
X
|
|||||
(4) Pool
Asset Administration
|
||||||||
(i) maintenance
of pool collateral
|
X
|
X
|
||||||
(ii) safeguarding
of pool assets/documents
|
X
|
X
|
||||||
(iii) additions,
removals and substitutions of pool assets
|
X
|
X
|
X
|
|||||
(iv) posting
and allocation of pool asset payments to pool assets
|
X
|
|||||||
(v) reconciliation
of servicer records
|
X
|
|||||||
(vi) modifications
or other changes to terms of pool assets
|
X
|
|||||||
(vii) loss
mitigation and recovery actions
|
X
|
|||||||
(viii)records
regarding collection efforts
|
X
|
|||||||
(ix) adjustments
to variable interest rates on pool assets
|
X
|
|||||||
(x) matters
relating to funds held in trust for obligors
|
X
|
|||||||
(xi) payments
made on behalf of obligors (such as for taxes or
insurance)
|
X
|
|||||||
(xii) late
payment penalties with respect to payments made on behalf of obligors
|
X
|
|||||||
(xiii)records
with respect to payments made on behalf of obligors
|
X
|
|||||||
(xiv) recognition
and recording of delinquencies, charge-offs and uncollectible
accounts
|
X
|
X
|
X
|
|||||
(xv) maintenance
of external credit enhancement or other support
|
X
|
X
|
X
(If required pursuant to Agreement)
|
______________________
*
The
descriptions of the Item 1122(d) servicing criteria use key words and
phrases
and are not verbatim recitations of the servicing criteria. Refer to
Regulation
AB, Item 1122 for a full description of servicing
criteria.
EXHIBIT
M
BACK-UP
CERTIFICATION
Re: __________
(the “Trust”)
Mortgage
Pass-Through Certificates, Series 2006-AR3
I,
[identify the certifying individual], certify to Nomura Asset Acceptance
Corporation (the “Depositor”), HSBC Bank USA, National Association (the
“Trustee”) and Xxxxx Fargo Bank, N.A. (the “Master Servicer”), and their
respective officers, directors and affiliates, and with the knowledge and
intent
that they will rely upon this certification, that:
(1) I
have
reviewed the servicer compliance statement of the Servicer provided in
accordance with Item 1123 of Regulation AB (the “Compliance Statement”), the
report on assessment of the Servicer’s compliance with the servicing criteria
set forth in Item 1122(d) of Regulation AB (the “Servicing Criteria”), provided
in accordance with Rules 13a-18 and 15d-18 under Securities Exchange Act
of
1934, as amended (the “Exchange Act”) and Item 1122 of Regulation AB (the
“Servicing Assessment”), the registered public accounting firm’s attestation
report provided in accordance with Rules 13a-18 and 15d-18 under the Exchange
Act and Section 1122(b) of Regulation AB (the “Attestation
Report”), and all servicing reports, officer’s certificates and other
information relating to the servicing of the Mortgage Loans by the Servicer
during 200[ ] that were delivered by the Servicer to the Master Servicer
pursuant to the Agreement (collectively, the “Servicer Servicing
Information”);
(2) Based
on
my knowledge, the Servicer Servicing Information, taken as a whole, does
not
contain any untrue statement of a material fact or omit to state a material
fact
necessary to make the statements made, in the light of the circumstances
under
which such statements were made, not misleading with respect to the period
of
time covered by the Servicer Servicing Information;
(3) Based
on
my knowledge, all of the Servicer Servicing Information required to be provided
by the Servicer under the Agreement has been provided to the Master
Servicer;
(4) I
am
responsible for reviewing the activities performed by the Servicer as servicer
under the Agreement, and based on my knowledge and the compliance review
conducted in preparing the Compliance Statement and except as disclosed in
the
Compliance Statement, the Servicing Assessment or the Attestation Report,
the
Servicer has fulfilled its obligations under the Agreement in all material
respects; and
(5) The
Compliance Statement required to be delivered by the Servicer pursuant to
the
Agreement, and the Servicing Assessment and Attestation Report required to
be
provided by the Servicer and by any Subservicer or Subcontractor pursuant
to the
Agreement, have been provided to the Master Servicer. Any material instances
of
noncompliance described in such reports have been disclosed to the Master
Servicer. Any material instance of noncompliance with the Servicing Criteria
has
been disclosed in such reports.
Capitalized
terms used and not otherwise defined herein have the meanings assigned thereto
in the Pooling and Servicing Agreement (the “Agreement”), dated as of September
1, 2006, among Nomura Asset Acceptance Corporation, Nomura Credit & Capital,
Inc., GMAC Mortgage Corporation, Xxxxx Fargo Bank, N.A. as master servicer
and
securities administrator, and HSBC Bank USA, National Association.
Date:
|
||
[Signature]
|
||
[Title]
|
EXHIBIT
N
FORM
10-D, FORM 8-K AND FORM 10-K
REPORTING
RESPONSIBILITY
As
to
each item described below, the entity indicated as the Responsible Party
shall
be primarily responsible for reporting the information to the party identified
as responsible for preparing the Securities Exchange Act Reports pursuant
to
Section 5.18. An asterisk indicates that the Responsible Party is responsible
for aggregating the information it receives from other Responsible
Parties.
Under
Item 1 of Form 10-D: a) items marked “5.10 statement” are required to be
included in the periodic Distribution Date statement under Section 5.10,
provided by the Securities Administrator based on information received from
the
Master Servicer; and b) items marked “Form 10-D report” are required to be in
the Form 10-D report but not the 5.10 statement, provided by the party
indicated. Information under all other Items of Form 10-D is to be included
in
the Form 10-D report.
Additional
Form 10-D Disclosure
ADDITIONAL
FORM 10-D DISCLOSURE
|
|
Item
on Form 10-D
|
Party
Responsible
|
Item
1: Distribution and Pool Performance Information
|
|
Information
included in the [Monthly Statement]
|
Servicer
Master
Servicer
Securities
Administrator
|
Any
information required by 1121 which is NOT included on the [Monthly
Statement]
|
Depositor
|
Item
2: Legal Proceedings
Any
legal proceeding pending against the following entities or their
respective property, that is material to Certificateholders, including
any
proceeding known to be contemplated by governmental
authorities:
|
|
▪
Issuing Entity (Trust Fund)
|
Trustee,
Master Servicer, Securities Administrator and Depositor
|
▪
Sponsor (Seller)
|
Seller
(if a party to the Pooling and Servicing Agreement) or
Depositor
|
▪
Depositor
|
Depositor
|
▪
Trustee
|
Trustee
|
▪
Securities Administrator
|
Securities
Administrator
|
▪
Master Servicer
|
Master
Servicer
|
▪
Custodian
|
Custodian
|
▪
1110(b) Originator
|
Depositor
|
▪
Any 1108(a)(2) Servicer (other than the Master Servicer or Securities
Administrator)
|
Servicer
|
▪
Any other party contemplated by 1100(d)(1)
|
Depositor
|
Item
3: Sale of Securities and Use of Proceeds
Information
from Item 2(a) of Part II of Form 10-Q:
With
respect to any sale of securities by the sponsor, depositor or
issuing
entity, that are backed by the same asset pool or are otherwise
issued by
the issuing entity, whether or not registered, provide the sales
and use
of proceeds information in Item 701 of Regulation S-K. Pricing
information
can be omitted if securities were not registered.
|
Depositor
|
Item
4: Defaults Upon Senior Securities
Information
from Item 3 of Part II of Form 10-Q:
Report
the occurrence of any Event of Default (after expiration of any
grace
period and provision of any required notice)
|
Securities
Administrator
Trustee
|
Item
5: Submission of Matters to a Vote of Security
Holders
Information
from Item 4 of Part II of Form 10-Q
|
Securities
Administrator
Trustee
|
Item
6: Significant Obligors of Pool Assets
Item
1112(b) - Significant
Obligor Financial Information*
|
Depositor
|
*This
information need only be reported on the Form 10-D for the distribution
period in which updated information is required pursuant to the
Item.
|
|
Item
7: Significant Enhancement Provider Information
Item
1114(b)(2) - Credit Enhancement Provider Financial
Information*
|
|
▪
Determining applicable disclosure threshold
|
Depositor
|
▪
Requesting required financial information (including any required
accountants’ consent to the use thereof) or effecting incorporation by
reference
|
Depositor
|
Item
1115(b) - Derivative Counterparty Financial
Information*
|
|
▪
Determining current maximum probable exposure
|
Depositor
|
▪
Determining current significance percentage
|
Depositor
|
▪
Requesting required financial information (including any required
accountants’ consent to the use thereof) or effecting incorporation by
reference
|
Depositor
|
*This
information need only be reported on the Form 10-D for the distribution
period in which updated information is required pursuant to the
Items.
|
|
Item
8: Other Information
Disclose
any information required to be reported on Form 8-K during the
period
covered by the Form 10-D but not reported
|
Any
party responsible for the applicable Form 8-K Disclosure
item
|
Item
9: Exhibits
|
|
Monthly
Statement to Certificateholders
|
Securities
Administrator
|
Exhibits
required by Item 601 of Regulation S-K, such as material
agreements
|
Depositor
|
Additional
Form 10-K Disclosure
ADDITIONAL
FORM 10-K DISCLOSURE
|
|
Item
on Form 10-K
|
Party
Responsible
|
Item
1B: Unresolved Staff Comments
|
Depositor
|
Item
9B: Other Information
Disclose
any information required to be reported on Form 8-K during the
fourth
quarter covered by the Form 10-K but not reported
|
Any
party responsible for disclosure items on Form 8-K
|
Item
15: Exhibits, Financial Statement Schedules
|
Securities
Administrator
Depositor
|
Reg
AB Item 1112(b): Significant Obligors of Pool
Assets
|
|
Significant
Obligor Financial Information*
|
Depositor
|
*This
information need only be reported on the Form 10-D for the distribution
period in which updated information is required pursuant to the
Item.
|
|
Reg
AB Item 1114(b)(2): Credit Enhancement Provider Financial
Information
|
|
▪
Determining applicable disclosure threshold
|
Depositor
|
▪
Requesting required financial information (including any required
accountants’ consent to the use thereof) or effecting incorporation by
reference
|
Depositor
|
*This
information need only be reported on the Form 10-D for the distribution
period in which updated information is required pursuant to the
Items.
|
|
Reg
AB Item 1115(b): Derivative Counterparty Financial
Information
|
|
▪
Determining current maximum probable exposure
|
Depositor
|
▪
Determining current significance percentage
|
Depositor
|
▪
Requesting required financial information (including any required
accountants’ consent to the use thereof) or effecting incorporation by
reference
|
Depositor
|
*This
information need only be reported on the Form 10-D for the distribution
period in which updated information is required pursuant to the
Items.
|
|
Reg
AB Item 1117: Legal Proceedings
Any
legal proceeding pending against the following entities or their
respective property, that is material to Certificateholders, including
any
proceeding known to be contemplated by governmental
authorities:
|
|
▪
Issuing Entity (Trust Fund)
|
Trustee,
Master Servicer, Securities Administrator and Depositor
|
▪
Sponsor (Seller)
|
Seller
(if a party to the Pooling and Servicing Agreement) or
Depositor
|
▪
Depositor
|
Depositor
|
▪
Trustee
|
Trustee
|
▪
Securities Administrator
|
Securities
Administrator
|
▪
Master Servicer
|
Master
Servicer
|
▪
Custodian
|
Custodian
|
▪
1110(b) Originator
|
Depositor
|
▪
Any 1108(a)(2) Servicer (other than the Master Servicer or Securities
Administrator)
|
Servicer
|
▪
Any other party contemplated by 1100(d)(1)
|
Depositor
|
Reg
AB Item 1119: Affiliations and Relationships
|
|
Whether
(a) the Sponsor (Seller), Depositor or Issuing Entity is an affiliate
of
the following parties, and (b) to the extent known and material,
any of
the following parties are affiliated with one another:
|
Depositor
as to (a)
Sponsor/Seller
as to (a)
|
▪
Master Servicer
|
Master
Servicer
|
▪
Securities Administrator
|
Securities
Administrator
|
▪
Trustee
|
Trustee
|
▪
Any other 1108(a)(3) servicer
|
Servicer
|
▪
Any 1110 Originator
|
Depositor/Sponsor
|
▪
Any 1112(b) Significant Obligor
|
Depositor/Sponsor
|
▪
Any 1114 Credit Enhancement Provider
|
Depositor/Sponsor
|
▪
Any 1115 Derivate Counterparty Provider
|
Depositor/Sponsor
|
▪
Any other 1101(d)(1) material party
|
Depositor/Sponsor
|
Whether
there are any “outside the ordinary course business arrangements” other
than would be obtained in an arm’s length transaction between (a) the
Sponsor (Seller), Depositor or Issuing Entity on the one hand,
and (b) any
of the following parties (or their affiliates) on the other hand,
that
exist currently or within the past two years and that are material
to a
Certificateholder’s understanding of the Certificates:
|
Depositor
as to (a)
Sponsor/Seller
as to (a)
|
▪
Master Servicer
|
Master
Servicer
|
▪
Securities Administrator
|
Securities
Administrator
|
▪
Trustee
|
Depositor/Sponsor
|
▪
Any other 1108(a)(3) servicer
|
Servicer
|
▪
Any 1110 Originator
|
Depositor/Sponsor
|
▪
Any 1112(b) Significant Obligor
|
Depositor/Sponsor
|
▪
Any 1114 Credit Enhancement Provider
|
Depositor/Sponsor
|
▪
Any 1115 Derivate Counterparty Provider
|
Depositor/Sponsor
|
▪
Any other 1101(d)(1) material party
|
Depositor/Sponsor
|
Whether
there are any specific relationships involving the transaction
or the pool
assets between (a) the Sponsor (Seller), Depositor or Issuing Entity
on
the one hand, and (b) any of the following parties (or their affiliates)
on the other hand, that exist currently or within the past two
years and
that are material:
|
Depositor
as to (a)
Sponsor/Seller
as to (a)
|
▪
Master Servicer
|
Master
Servicer
|
▪
Securities Administrator
|
Securities
Administrator
|
▪
Trustee
|
Depositor/Sponsor
|
▪
Any other 1108(a)(3) servicer
|
Servicer
|
▪
Any 1110 Originator
|
Depositor/Sponsor
|
▪
Any 1112(b) Significant Obligor
|
Depositor/Sponsor
|
▪
Any 1114 Credit Enhancement Provider
|
Depositor/Sponsor
|
▪
Any 1115 Derivate Counterparty Provider
|
Depositor/Sponsor
|
▪
Any other 1101(d)(1) material party
|
Depositor/Sponsor
|
Form
8-K
Disclosure Information
FORM
8-K DISCLOSURE INFORMATION
|
|
Item
on Form 8-K
|
Party
Responsible
|
Item
1.01- Entry into a Material Definitive Agreement
Disclosure
is required regarding entry into or amendment of any definitive
agreement
that is material to the securitization, even if depositor is not
a party.
Examples:
servicing agreement, custodial agreement.
Note:
disclosure not required as to definitive agreements that are fully
disclosed in the prospectus
|
All
parties
|
Item
1.02- Termination of a Material Definitive Agreement
Disclosure
is required regarding termination of any definitive agreement that
is
material to the securitization (other than expiration in accordance
with
its terms), even if depositor is not a party.
Examples:
servicing agreement, custodial agreement.
|
All
parties
|
Item
1.03- Bankruptcy or Receivership
Disclosure
is required regarding the bankruptcy or receivership, with respect
to any
of the following:
|
|
▪
Sponsor (Seller)
|
Depositor/Sponsor
(Seller)
|
▪
Depositor
|
Depositor
|
▪
Master Servicer
|
Master
Servicer
|
▪
Affiliated Servicer
|
Servicer
|
▪
Other Servicer servicing 20% or more of the pool assets at the
time of the
report
|
Servicer
|
▪
Other material servicers
|
Servicer
|
▪
Trustee
|
Trustee
|
▪
Securities Administrator
|
Securities
Administrator
|
▪
Significant Obligor
|
Depositor
|
▪
Credit Enhancer (10% or more)
|
Depositor
|
▪
Derivative Counterparty
|
Depositor
|
▪
Custodian
|
Custodian
|
Item
2.04- Triggering Events that Accelerate or Increase a Direct Financial
Obligation or an Obligation under an Off-Balance Sheet
Arrangement
Includes
an early amortization, performance trigger or other event, including
event
of default, that would materially alter the payment priority/distribution
of cash flows/amortization schedule.
Disclosure
will be made of events other than waterfall triggers which are
disclosed
in the monthly statements to the certificateholders.
|
Depositor
Master
Servicer
Securities
Administrator
|
Item
3.03- Material Modification to Rights of Security
Holders
Disclosure
is required of any material modification to documents defining
the rights
of Certificateholders, including the Pooling and Servicing
Agreement.
|
Securities
Administrator
Trustee
Depositor
|
Item
5.03- Amendments of Articles of Incorporation or Bylaws; Change
of Fiscal
Year
Disclosure
is required of any amendment “to the governing documents of the issuing
entity”.
|
Depositor
|
Item
6.01- ABS Informational and Computational
Material
|
Depositor
|
Item
6.02- Change of Servicer or Securities Administrator
Requires
disclosure of any removal, replacement, substitution or addition
of any
master servicer, affiliated servicer, other servicer servicing
10% or more
of pool assets at time of report, other material servicers or
trustee.
|
Master
Servicer/Securities Administrator/Depositor/
Servicer/Trustee
|
Reg
AB disclosure about any new servicer or master servicer is also
required.
|
Servicer/Master
Servicer/Depositor
|
Reg
AB disclosure about any new Trustee is also required.
|
Trustee
|
Item
6.03- Change in Credit Enhancement or External
Support
Covers
termination of any enhancement in manner other than by its terms,
the
addition of an enhancement, or a material change in the enhancement
provided. Applies to external credit enhancements as well as derivatives.
|
Depositor/Securities
Administrator
|
Reg
AB disclosure about any new enhancement provider is also
required.
|
Depositor
|
Item
6.04- Failure to Make a Required Distribution
|
Securities
Administrator
Trustee
|
Item
6.05- Securities Act Updating Disclosure
If
any material pool characteristic differs by 5% or more at the time
of
issuance of the securities from the description in the final prospectus,
provide updated Reg AB disclosure about the actual asset
pool.
|
Depositor
|
If
there are any new servicers or originators required to be disclosed
under
Regulation AB as a result of the foregoing, provide the information
called
for in Items 1108 and 1110 respectively.
|
Depositor
|
Item
7.01- Reg FD Disclosure
|
All
parties
|
Item
8.01- Other Events
Any
event, with respect to which information is not otherwise called
for in
Form 8-K, that the registrant deems of importance to
certificateholders.
|
Depositor
|
Item
9.01- Financial Statements and Exhibits
|
Responsible
party for reporting/disclosing the financial statement or
exhibit
|
EXHIBIT
O
INTEREST
RATE SWAP AGREEMENT
DATE: |
September
29, 2006
|
TO: |
HSBC
Bank USA, National Association not individually, but solely as
Supplemental Interest Trust Trustee on behalf of the supplemental
interest
trust with respect to the Nomura Asset Acceptance Corporation,
Alternative
Loan Trust, Series 2006-AR3, Mortgage Pass-Through
Certificates.
|
ATTENTION: |
HSBC
Bank USA, National Association
000
Xxxxx Xxxxxx
Xxx
Xxxx, Xxx Xxxx 00000
Attention:
Nomura Asset Acceptance Corp.,
2006-AR3
|
FROM: |
ABN
AMRO Bank N.V.
|
SUBJECT: |
Fixed
Income Derivatives Confirmation and Agreement
|
REFERENCE NUMBER: |
3698366
|
The
purpose of this letter agreement (“Agreement”) is to confirm the terms and
conditions of the current Transaction entered into on the Trade Date specified
below (the “Transaction”) between ABN AMRO Bank N.V. (“Party A”) and HSBC Bank
USA, National Association, not individually, but solely as trustee (the
“Supplemental Interest Trust Trustee”) on behalf of the supplemental interest
trust with respect to the Nomura Asset Acceptance Corporation, Alternative
Loan
Trust, Series 2006-AR3, Mortgage Pass-Through Certificates (the “Supplemental
Interest Trust”) (“Party B”) created under the Pooling and Servicing Agreement,
dated as of September 1, 2006, among Nomura Asset Acceptance Corporation
as
depositor, GMAC Mortgage Corporation, as servicer, Xxxxx Fargo Bank, N.A
as
master servicer and securities administrator and HSBC Bank USA, National
Association as trustee (the “Pooling and Servicing Agreement”). This Agreement,
which evidences a complete and binding agreement between you and us to enter
into the Transaction on the terms set forth below, constitutes a “Confirmation”
as referred to in the “ISDA Form Master Agreement” (as defined below), as well
as a “Schedule” as referred to in the ISDA Form Master Agreement.
1. |
This
Agreement is subject to the 2000
ISDA Definitions (the
“Definitions”), as published by the International Swaps and Derivatives
Association, Inc. (“ISDA”). Any reference to a “Swap Transaction” in the
Definitions is deemed to be a reference to a “Transaction” for purposes of
this Agreement, and any reference to a “Transaction” in this Agreement is
deemed to be a reference to a “Swap Transaction” for purposes of the
Definitions. You and we have agreed to enter into this Agreement
in lieu
of negotiating a Schedule to the 1992 ISDA Master Agreement
(Multicurrency—Cross Border) form (the “ISDA Form Master Agreement”) but,
rather, an ISDA Form Master Agreement shall be deemed to have been
executed by you and us on the date we entered into the Transaction,
and
this Agreement shall form part of, supplement and be subject to
such ISDA
Form Master Agreement. For the avoidance of doubt, the Transaction
described herein shall be the sole Transaction governed by such
ISDA Form
Master Agreement. Each term capitalized but not defined herein
or
in
the Definitions
shall have the meaning assigned thereto in the Pooling and Servicing
Agreement. Each reference to a “Section” (unless specifically referencing
the Pooling and Servicing Agreement) or to a “Section” “of this Agreement”
will be construed as a reference to a Section of the ISDA Form
Master
Agreement, and each reference to a “Part” will be construed as a reference
to the provisions herein deemed incorporated in a Schedule to the
ISDA
Form Master Agreement.
|
In
the
event of any inconsistency between any of the following documents, the relevant
document first listed below shall govern: (i) a Confirmation; (ii) the Schedule
and Paragraph 13 of an ISDA Credit Support Annex (as applicable); (iii) the
ISDA
Definitions; and (iv) the ISDA Form Master Agreement and ISDA Credit Support
Annex (as applicable).
2.
|
The
terms of the particular Transaction to which this Confirmation
relates are
as follows:
|
Type
of Transaction:
|
Interest
Rate Swap
|
Notional
Amount:
|
With
respect to any Calculation Period, the amount set forth for such
period on
Schedule I attached hereto.
|
Trade
Date:
|
September
18, 2006
|
Effective
Date:
|
September
29, 2006
|
Termination
Date:
|
September
25, 2011, subject to adjustment in accordance with the Business
Day
Convention; provided, however, that for the purpose of determining
the
final Fixed Rate Payer Period End Date, Termination Date shall
be subject
to No Adjustment
|
Fixed
Amounts:
|
|
Fixed
Rate Payer:
|
Party
B
|
Fixed
Rate Payer
|
|
Period
End Dates:
|
The
25th
calendar day of each month during the Term of this Transaction,
commencing
October 25, 2006, and ending on the Termination Date, with No
Adjustment.
|
Fixed
Rate Payer
|
|
Payment
Dates:
|
Early
Payment shall be applicable. Each Fixed Rate Payer Payment Date
shall be
one Business Day prior to the related Fixed Rate Payer Period
End
Date.
|
Fixed
Rate:
|
5.290%
|
Fixed
Rate Day
|
|
Count
Fraction:
|
30/360
|
Additional
Fixed Payment
|
On
the Effective Date, Party B will make a payment to Party A of
USD $7,000
(such payment shall be made by Nomura Securities International,
Inc. on
behalf of Party B).
|
Floating
Amounts:
|
|
Floating
Rate Payer:
|
Party
A
|
Floating
Rate Payer
|
|
Period
End Dates:
|
The
25th
calendar day of each month during the Term of this Transaction,
commencing
October 25, 2006, and ending on the Termination Date, subject
to
adjustment in accordance with the Business Day
Convention.
|
Floating
Rate Payer
|
|
Payment
Dates:
|
Early
Payment shall be applicable. Each Floating Rate Payer Payment
Date shall
be one Business Day prior to the related Floating Rate Payer
Period End
Date.
|
Floating
Rate Option:
|
USD-LIBOR-BBA
|
Designated
Maturity:
|
One
month
|
Floating
Rate Day
|
|
Count
Fraction:
|
Actual/360
|
Reset
Dates:
|
The
first day of each Calculation Period.
|
Compounding:
|
Inapplicable
|
Business
Days:
|
New
York
|
Business
Day Convention:
|
Following
|
Calculation
Agent:
|
Party
A
|
Offices:
|
The
office of Party A for this Transaction is London
|
3.
|
Provisions
Deemed Incorporated in a Schedule to the Master
Agreement:
|
Part
1.
|
Termination
Provisions.
|
For
the
purposes of this Agreement:-
(a) |
“Specified
Entity”
is
not applicable to Party A or Party B for any purpose.
|
(b)
|
“Specified
Transaction”
is
not applicable to Party A or Party B for any purpose, and, accordingly,
Section 5(a)(v) shall not apply to Party A or Party
B.
|
(c)
|
Events
of Default:
|
(i) |
The
“Breach
of Agreement”
provision of Section 5(a)(ii) will not apply to Party A or Party
B.
|
(ii) |
The
“Credit
Support Default”
provisions of Section 5(a)(iii) will apply to Party A (if Party
A posts
collateral or provides a guarantee or other contingent agreement
pursuant
to Part 5(h) below), and will not apply to Party
B.
|
(iii) |
The
“Misrepresentation”
provisions of Section 5(a)(iv) will not apply to Party A or Party
B.
|
(iv) |
The
“Cross
Default”
provisions of Section 5(a)(vi) will not apply to Party A or to
Party B.
|
(v) |
The
“Bankruptcy”
provision of Section 5(a)(vii)(2) will not apply to Party
B.
|
(vi) |
The
“Merger
Without Assumption”
provisions of Section 5(a)(viii) will not apply to Party
B.
|
(d) |
Termination
Events:
|
(i)
|
The
“Credit
Event Upon Merger”
provisions of Section 5(b)(iv) will not apply to Party A or Party
B.
|
(e)
|
The
“Automatic
Early Termination”
provision of Section 6(a) will not apply to Party A or to Party
B.
|
(f) |
Payments
on Early Termination.
For the purpose of Section 6(e) of this
Agreement:
|
(i) |
Market
Quotation will apply.
|
(ii) |
The
Second Method will apply.
|
(g) |
“Termination
Currency”
means United States Dollars.
|
(h) |
Additional
Termination Events.
Additional Termination Events will apply as provided in Part 5(h).
|
Part
2. Tax
Representations.
(a)
|
Payer
Representations.
For the purpose of Section 3(e) of this Agreement, each of Party
A and
Party B makes the following
representation:
|
It
is not required by any applicable law, as modified by the practice
of any
relevant governmental revenue authority, of any Relevant Jurisdiction
to
make any deduction or withholding for or on account of any Tax
from any
payment (other than interest under Section 2(e), 6(d)(ii) or 6(e)
of this
Agreement) to be made by it to the other party under this Agreement.
In
making this representation, it may rely on:
|
(i) |
the
accuracy of any representations made by the other party pursuant
to
Section 3(f) of this
Agreement;
|
(ii) |
the
satisfaction of the agreement contained in Section 4(a)(i)
or 4(a)(iii) of
this Agreement and the accuracy and effectiveness of any document
provided
by the other party pursuant to Section 4(a)(i) or 4(a)(iii)
of this
Agreement; and
|
(iii) |
the
satisfaction of the agreement of the other party contained
in Section 4(d)
of this Agreement,
|
provided
that it
shall not be a breach of this representation where reliance is placed on
clause
(ii) and the other party does not deliver a form or document under Section
4(a)(iii) by reason of material prejudice to its legal or commercial position.
(b)
Payee
Representations.
For the
purpose of Section 3(f) of this Agreement:
(i) |
Party
A makes the following
representation(s):
|
(A)
It is
a resident of The Netherlands for the purpose of the application of the existing
tax treaties between The Netherlands and those countries where offices of
Party
B are located.
(B)
With
respect to
its
non-U.S. branches, it is fully eligible for the benefits of the “Business
Profits” or “Industrial and Commercial Profits” provision, as the case may be,
the “Interest” provision or the “Other Income” provision (if any) of the
Specified Treaty with respect to any payment described in such provisions
and
received or to be received by it in connection with this Agreement and no
such
payment is attributable to a trade or business carried on by it through a
permanent establishment in the Specified Jurisdiction. With respect to Party
A,
Specified Treaty means the income tax treaty between the United States and
The
Netherlands; Specified Jurisdiction means the United States.
(C)
With
respect to its U.S. branches, each payment received or to be received by
it in
connection with this Agreement will be effectively connected with its conduct
of
a trade or business in the United States.
(ii)
|
Party
B makes the following
representation(s):
|
The
beneficial owner of the payments made to it under this Agreement is either
(i) a
"U.S. person" (as that term is used in section 1.1441-4(a)(3)(ii) of United
States Treasury Regulations) for United States federal income tax purposes
and
an "Exempt recipient" within the meaning of section 1.6049-4(c)(1)(ii) of
United
States Treasury Regulations, or (ii) a "non-U.S. branch of a foreign person"
as
that term is used in section 1.1441-4(a)(3)(ii) of the United States Treasury
Regulations (the "Regulations") for United States federal income tax purposes,
and it is a "foreign person" as that term is used in section 1.6041-4(a)(4)
of
the Regulations for United States federal income tax purposes.
Part
3. Agreement
to Deliver Documents.
(a) |
For
the purpose of Section 4(a)(i), tax forms, documents, or certificates
to
be delivered are:
|
Each
party agrees to complete, accurately and in a manner reasonably satisfactory
to
the other party, and to execute, arrange for any required certification of,
and
deliver to the other party (or to such government or taxing authority as
the
other party reasonably directs), any form or document that may be required
or
reasonably requested in order to allow the other party to make a payment
under
this Agreement without any deduction or withholding for or on account of
any Tax
or with such deduction or withholding at a reduced rate, promptly upon the
earlier of (i) reasonable demand by the other party and (ii) learning that
the
form or document is required.
Party
required to
deliver
document
|
Form/Document/
Certificate
|
Date
by which to
be
delivered
|
||
Party
A
|
A
correct, complete and duly executed U.S. Internal Revenue Service
Form
W-8ECI and W-8BEN (or successor thereto), together with appropriate
attachments, that eliminates U.S. federal withholding and backup
withholding tax on payments to Party A under this Agreement.
|
(A)
before the first Payment Date under this Agreement, (B) promptly
upon
reasonable demand by the other party and (C) promptly upon learning
that
any such form previously provided by the party has become obsolete
or
incorrect.
|
||
Party
B
|
A
correct, complete and duly executed U.S. Internal Revenue Service
Form W-9
(or successor thereto), together with appropriate attachments,
that
eliminates U.S. federal withholding and backup withholding tax
on payments
to Party B under this Agreement.
|
(A)
before the first Payment Date under this Agreement, (B) promptly
upon
reasonable demand by the other party and (C) promptly upon learning
that
any such form previously provided by the party has become obsolete
or
incorrect.
|
(b) For
the
purpose of Section 4(a)(ii), other documents to be delivered are:
Party
required
to
deliver
document
|
Form/Document/
Certificate
|
Date
by which to
be
delivered
|
Covered
by
Section
3(d)
Representation
|
|||
Party
A and
Party
B
|
Any
documents required by the receiving party to evidence the authority
of the
delivering party or its Credit Support Provider, if any, for it
to execute
and deliver this Agreement, any Confirmation, and any Credit Support
Documents to which it is a party, and to evidence the authority
of the
delivering party or its Credit Support Provider to perform its
obligations
under this Agreement, such Confirmation and/or Credit Support Document,
as
the case may be
|
Upon
the execution and delivery of this Agreement
|
Yes
|
|||
Party
A and
Party
B
|
A
certificate of an authorized officer of the party, as to the incumbency
and authority of the respective officers of the party signing this
Agreement, any relevant Credit Support Document, or any Confirmation,
as
the case may be
|
Upon
the execution and delivery of this Agreement
|
Yes
|
Party
A
|
Annual
Report of ABN AMRO Holding N.V. containing consolidated financial
statements certified by independent certified public accountants
and
prepared in accordance with generally accepted accounting principles
in
the country in which such party is organized
|
Promptly
after request by Party B
|
Yes
|
|||
Party
A and
Party
B
|
An
opinion of counsel with respect to the due authorization, execution
and
enforceability of this Agreement, acceptable to the other party
hereto.
|
Upon
the execution and delivery of this Agreement and such
Confirmation
|
Part
4. Miscellaneous.
(a)
|
Address
for Notices:
For the purposes of Section 12(a) of this
Agreement:
|
Address
for notices or communications to Party A:
1. |
For
the purposes of Section 5, 6, and 7 under this
Agreement:
|
ABN
AMRO Bank N.V., Chicago Branch
Global
Documentation Unit
000
X.
Xxxxxxx Xxxxxx, 00xx
Xxxxx
Xxxxxxx,
XX 00000
Attention:
Treasury Documentation
Telephone:
000-000-0000
Fax:
000-000-0000
2. |
For
all purposes to the Office through which Party A is acting
for
|
the
purposes of the relevant Transactions:
ABN
AMRO Bank X.X., Xxxxxxxxx Xxxx Xxxxxx
X.X.
Xxx
000
0000
XX
Amsterdam
Xxxxxxx,
XX 00000
The
Netherlands
Attention:
Operations Derivatives Markets
Forex
Options
Telephone:
00-00-0000000
Telefax:
00-00-0000000
Swaps
Telephone:
00-00-0000000
Telefax:
00-00-0000000
Interest
Related Products
Telephone
00-00-0000000
Telefax:
00-00-0000000
Credit
Derivatives
Telephone:
00-00-0000000
Telefax:
00-00-0000000
Telex:
16021 Answerback: ABAM NL
Electronic
Messaging System Details: Swift ABNA NL 2A
ABN
AMRO Bank, N.V., Chicago Branch
000
Xxxx
Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
XX 00000
Attention:
Treasury Operations
Telephone:
000-000-0000
Telefax:
000-000-0000
Electronic
Messaging System Details: ABNA US 33a XXX
ABN
AMRO Bank N.V., London Branch
000
Xxxxxxxxxxx,
Xxxxxx
XX0X 0XX,
Xxxxxx
Xxxxxxx
Attention:
Fixed Income Derivatives Documentation
Telex:
887366 Answerback: ABNALN G
Telephone:
00 00 0000 0000
Telefax:
44 20 7857 9428
Electronic
Messaging System Details: Swift ABNA XX 0X
(For
all
purposes)
Address
for notices or communications to Party B:
HSBC
Bank
USA, National Association
000
Xxxxx
Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
Nomura Asset Acceptance Corp., 2006-AR3
(For
all
purposes)
With
copy
to:
Xxxxx
Fargo Bank, N.A.
0000
Xxx
Xxxxxxxxx Xxxx
Xxxxxxxx,
XX 00000
Attention:
Client Manager, NAAC 2006-AR3
Facsimile:
000-000-0000
(b) |
Process
Agent.
For the purpose of Section 13(c):
|
Party
A
appoints as its
Process
Agent: Not
Applicable
Party
B
appoints as its
Process
Agent: Not
Applicable
(c)
|
Offices.
The provisions of Section 10(a) will apply to this
Agreement.
|
(d)
|
Multibranch
Party.
For the purpose of Section 10(c) of this
Agreement:
|
Party
A is a Multibranch Party and may act through its Amsterdam head
office,
and its London or Chicago branches.
|
Party
B is not a Multibranch Party.
|
(e)
|
Calculation
Agent.
The Calculation Agent is Party A, provided, however, that if an
Event of
Default shall have occurred with respect to Party A, Party B shall
have
the right to appoint as Calculation Agent a third party, reasonably
acceptable to Party A, the cost for which shall be borne by Party
A.
|
(f) |
Credit
Support Document.
|
Party A: |
None
or, in that event that Party A posts collateral under a Credit
Support
Annex or provides a guarantee or other contingent agreement pursuant
to
Part 5(i) below, such Credit Support Annex or guarantee or other
contingent agreement.
|
Party
B: None
(g)
|
Credit
Support Provider.
|
Party A: |
None
or, in that event that Party A provides a guarantee or other contingent
agreement pursuant to Part 5(i) below, such guarantor or other
provider of
credit support.
|
Party
B: None
(h)
|
Governing
Law.
The parties to this Agreement hereby agree that the law of the
State of
New York shall govern their rights and duties in whole, without
regard to
the conflict of law provisions thereof other than New York General
Obligations Law Sections 5-1401 and 5-1402.
|
(i)
|
Netting
of Payments.
The parties agree that subparagraph (ii) of Section 2(c) of the
ISDA Form
Master Agreement will apply to any
Transaction.
|
(j)
|
“Affiliate.”
Party B shall be deemed not to have any Affiliates for purposes
of this
Agreement, including for purposes of Section
6(b)(ii).
|
Part
5. Others
Provisions.
(a)
|
Amendments
to ISDA Form Master
Agreement.
|
(i)
|
Section
3 of the ISDA Form Master Agreement is hereby amended by adding
at the end
thereof the following subsection (g):
|
“(g)
|
Relationship
Between Parties.
|
Each
party represents to the other party on each date when it enters into a
Transaction that:--
(1)
|
Nonreliance.
(i) It is not relying on any statement or representation of the
other
party regarding the Transaction (whether written or oral), other
than the
representations expressly made in this Agreement or the Confirmation
in
respect of that Transaction and (ii) it has consulted with its
own legal,
regulatory, tax, business, investment, financial and accounting
advisors
to the extent it has deemed necessary, and it has made its own
investment,
hedging and trading decisions based upon its own judgment and upon
any
advice from such advisors as it has deemed necessary and not upon
any view
expressed by the other party.
|
(2)
|
Evaluation
and Understanding. (i) It has the capacity to evaluate (internally
or
through independent professional advice) the Transaction and has
made its
own decision subject to Section 6(n) of this Agreement to enter
into the
Transaction and (ii) It understands the terms, conditions and risks
of the
Transaction and is willing and able to accept those terms and conditions
and to assume those risks, financially and otherwise.
|
(3)
|
Purpose.
It is entering into the Transaction for the purposes of managing
its
borrowings or investments, hedging its underlying assets or liabilities
or
in connection with a line of business.
|
(4)
|
Status
of Parties. The other party is not acting as an agent, fiduciary
or
advisor for it in respect of the
Transaction.
|
(5) |
Eligible
Contract Participant. It is an “eligible swap participant” as such term is
defined in, Section 35.1(b)(2) of the regulations (17 C.F.R.
35)
promulgated under, and an “eligible contract participant” as defined in
Section 1(a)(12) of the Commodity Exchange Act, as
amended.”
|
(6) |
No
Agency. It is entering this Agreement, any Credit Support Document
to
which it is a party, each Transaction, and any other documentation
relating to this Agreement that it is required to deliver as
principal
(and not as agent or in any other capacity, fiduciary or
otherwise).
|
(ii)
|
Section
5(a)(i) of the ISDA Form Master Agreement is hereby amended by
replacing
the word “third” with the word “first” in the third line
thereof.
|
(b)
|
Set-Off.
The provisions for Set-off set forth in Section 6(e) of the ISDA
Form
Master Agreement shall not apply for purposes of this Transaction.
Notwithstanding any provision of this Agreement or any other existing
or
future agreement, each party irrevocably waives any and all rights
it may
have to set off, net, recoup or otherwise withhold or suspend or
condition
payment or performance of any obligation between it and the other
party
hereunder against any obligation between it and the other party
under any
other agreements.
|
(c)
|
Consent
to Recording.
Each party hereto consents to the monitoring or recording, at any
time and
from time to time, by the other party of any and all communications
between trading, marketing, and operations personnel of the parties
and
their Affiliates, waives any further notice of such monitoring
or
recording, and agrees to notify such personnel of such monitoring
or
recording.
|
(d)
|
Waiver
of Jury Trial.
Each party waives any right it may have to a trial by jury in respect
of
any Proceedings relating to this Agreement or any Credit Support
Document.
|
(e)
|
Non-Recourse.
Notwithstanding any provision herein or in the ISDA Form Master
Agreement
to the contrary, the obligations of Party B hereunder are limited
recourse
obligations of Party B, payable solely from the Supplemental Interest
Trust and the proceeds thereof, in accordance with the priority
of
payments and other terms of the Pooling and Servicing Agreement.
In the
event that the Supplemental Interest Trust and the proceeds thereof,
should be insufficient to satisfy all claims outstanding and following
the
realization of the account held by the Supplemental Interest Trust
and the
proceeds thereof, any claims against or obligations of Party B
under the
ISDA Form Master Agreement or any other confirmation thereunder
still
outstanding shall be extinguished and thereafter not revive. The
Supplemental Interest Trust Trustee shall not have liability for
any
failure or delay in making a payment hereunder to Party A due to
any
failure or delay in receiving amounts in the account held by the
Supplemental Interest Trust from the Trust created pursuant to
the Pooling
and Servicing Agreement.
|
(f)
|
Transfer,
Amendment and Assignment.
No
transfer, amendment or assignment of this Agreement shall be permitted
by
either party unless Moody’s and S&P have been provided prior notice of
the same and confirms in writing (including by facsimile transmission)
that it will not downgrade, withdraw or otherwise modify its then-current
ratings of any Certificates or
Notes.
|
(g)
|
Gross
Up.
Section 2(d)(i)(4) shall not apply to Party B as X, and Section
2(d)(ii)
shall not apply to Party B as Y, such that Party B shall not be
required
to pay any additional amounts referred to
therein.
|
(h)
|
Additional
Termination Events.
The following Additional Termination Events will
apply:
|
(i)
|
If
a Rating Agency Downgrade has occurred and Party A has not complied
with
Part 5(i) below, then an Additional Termination Event shall have
occurred
with respect to Party A and Party A shall be the sole Affected
Party with
respect to such Additional Termination Event.
|
(ii) |
If,
upon the occurrence of a Swap Disclosure Event (as defined in
Part 5(j)
below) Party A has not, within ten (10) calendar days after such
Swap
Disclosure Event complied with any of the provisions set forth
in clause
(iii) of Part 5(j) below, then an Additional Termination Event
shall have
occurred with respect to Party A and Party A shall be the sole
Affected
Party with respect to such Additional Termination
Event.
|
(iii) |
If,
at any time, the Master Servicer purchases the Mortgage Loans
pursuant to
Section 10.01 of the Pooling and Servicing Agreement, then an
Additional
Termination Event shall have occurred and Party B shall be the
sole
Affected Party with respect thereto; provided, however, that
notwithstanding Section 6(b)(iv) of the ISDA Form Master Agreement,
both
Party A and Party B shall have the right to designate an Early
Termination
Date in respect of this Additional Termination Event; provided,
further,
that such Early Termination Date shall be on the final Distribution
Date.
|
(iv) |
If,
without the prior written consent of Party A where such consent is
required under the Pooling and Servicing Agreement (such consent
not to be
unreasonably withheld), an amendment or supplemental agreement
is made to
the Pooling and Servicing Agreement which amendment or supplemental
agreement could reasonably be expected to have a material adverse
effect
on the interests of Party A under this Agreement, an Additional
Termination Event shall have occurred with respect to Party
B and Party B shall be the sole Affected Party with respect
to such Additional Termination
Event.
|
(i)
|
Rating
Agency Downgrade.
In
the event that (i) Party A’s short-term unsecured and unsubordinated debt
rating is reduced below “A-1” by S&P, or, in the event that Party A
does not have a short-term rating from S&P, if Party A’s long-term
unsecured and unsubordinated debt rating is reduced below “A+” by S&P,
or (ii) Party A’s long-term unsecured and unsubordinated debt rating is
reduced below “A1” by Moody’s or its short-term unsecured and
unsubordinated debt rating is reduced below “P1” by Moody’s, or, in the
event that Party A does not have a short-term rating from Moody’s, if
Party A’s long-term unsecured and unsubordinated debt rating is reduced
below “Aa3” by Moody’s (and together with Moody’s, the “Swap Rating
Agencies” and such rating thresholds, “Approved Rating Thresholds” and any
such reduction below the Approved Rating Thresholds, a “Collateral Rating
Downgrade Event”), then within thirty (30) calendar days after such rating
withdrawal or downgrade (unless, within 30 days after such withdrawal
or
downgrade, each such Swap Rating Agency, as applicable, has reconfirmed
the rating of the Nomura Asset Acceptance Corporation, Alternative
Loan
Trust, Series 2006-AR3, Mortgage Pass-Through Certificates (the
“Certificates”) and any notes backed by the Certificates (the “Notes”),
which was in effect immediately prior to such withdrawal or downgrade),
Party A shall, at its own expense, subject to the Rating Agency
Condition,
either (i) seek another entity to replace Party A as party to this
Agreement that meets or exceeds the Approved Rating Thresholds
on terms
substantially similar to this Agreement, (ii) obtain a guaranty
of, or a
contingent agreement of another person with the Approved Rating
Thresholds, to honor, Party A’s obligations under this Agreement, or (iii)
post collateral which will be sufficient to restore the immediately
prior
ratings of the Certificates and any Notes. In the event that Party
A’s
long-term unsecured and unsubordinated debt rating is withdrawn
or reduced
below “BBB-” by S&P (a “Required Rating Downgrade Event”), then within
ten (10) calendar days after such rating withdrawal or downgrade,
Party A
shall, subject to the Rating Agency Condition and at its own expense,
either (i) secure another entity to replace Party A as party to
this
Agreement that meets or exceeds the Approved Rating Thresholds
on terms
substantially similar to this Agreement or (ii) obtain a guaranty
of, or a
contingent agreement of another person with the Approved Rating
Thresholds, to honor, Party A’s obligations under this Agreement. For
purposes of this provision, “Rating Agency Condition” means, with respect
to any particular proposed act or omission to act hereunder that
the party
acting or failing to act must consult with each of the Swap Rating
Agencies then providing a rating of the Certificates and any Notes
and
receive from each of the Swap Rating Agencies a prior written confirmation
that the proposed action or inaction would not cause a downgrade
or
withdrawal of the then-current rating of any Certificates or Notes.
For
purposes of this Agreement, the occurrence of either a Collateral
Rating
Downgrade Event or a Required Rating Downgrade Event may be referred
to as
a rating agency downgrade (a “Rating Agency
Downgrade”).
|
(j) |
Compliance
with Regulation AB.
|
(i)
|
Party
A agrees and acknowledges that Nomura
Asset Acceptance Corporation (the “Depositor”) may be required under
Regulation AB, as defined in the Pooling and Servicing Agreement,
to
disclose certain financial information regarding Party A or its
group of
affiliated entities, if applicable, depending on the aggregate
“significance percentage” of this Agreement and any other derivative
contracts between Party A or its group of affiliated entities,
if
applicable, and Party B, as calculated from time to time in accordance
with Item 1115 of Regulation AB.
|
(ii)
|
It
shall be a swap disclosure event (“Swap Disclosure Event”) if, on any
Business Day after the date hereof for so long as the Issuing Entity
is
required to file periodic reports under the Exchange Act with respect
to
the Certificates, Party B or the Depositor requests from Party
A by
written notice the applicable financial information described in
Item
1115(b) of Regulation AB (such request to be based on a reasonable
determination by the Depositor, when the “significance percentage” is 6%
or higher; it being understood that the determination of such
“significance percentage” shall be based on “significance estimates” made
in substantially the same manner as that used in the Sponsor’s internal
risk management process in respect of similar instruments and furnished
by
the Sponsor to the Depositor, or if the Sponsor does not furnish
such
significance estimates to the Depositor, based on a determination
of such
significance estimates by the Depositor in a manner that it deems
reasonable) and Party B has received such notice (the “Swap Financial
Disclosure”).
|
(iii)
|
Upon
the occurrence of a Swap Disclosure Event, Party A, at its own
expense and
subject to the Rating Agency Condition, shall either (1)(a) either
(i)
provide to the Depositor the current Swap Financial Disclosure
in an
XXXXX-compatible format (for example, such information may be provided
in
Microsoft Word® or Microsoft Excel® format but not in .pdf format) or (ii)
provide written consent to the Depositor to incorporation by reference
of
such current Swap Financial Disclosure that are filed with the
Securities
and Exchange Commission in the Exchange Act Reports of the Depositor,
(b)
if applicable, cause its outside accounting firm to provide its
consent to
filing or incorporation by reference in the Exchange Act Reports
of the
Depositor of such accounting firm’s report relating to their audits of
such current Swap Financial Disclosure, and (c) provide to the
Depositor
any updated Swap Financial Disclosure with respect to Party A or
any
entity that consolidates Party A within five Business Days of the
release
of any such updated Swap Financial Disclosure; (2) secure another
entity
to replace Party A as party to this Agreement on terms substantially
similar to this Agreement, which entity (or a guarantor therefor)
meets or
exceeds the Approved Rating Thresholds and which entity complies
with the
requirements of Item 1115 of Regulation AB and clause (1) above,
or (3)
obtain a guaranty of Party A’s obligations under this Agreement from an
affiliate of Party A that complies with the financial information
disclosure requirements of Item 1115 of Regulation AB, and cause
such
affiliate to provide Swap Financial Disclosure and any future Swap
Financial Disclosure and other information pursuant to clause (1),
such
that disclosure provided in respect of such affiliate will satisfy
any
disclosure requirements applicable to Party B or (4) post collateral
satisfactory to the Depositor that will be sufficient to reduce
the
“significance percentage” as defined under Item 1115 of Regulation AB such
that no information that would otherwise have constituted Swap
Financial
Disclosure will be required to be filed with, or incorporated by
reference
into, the Exchange Act reports of the Depositor pursuant to Item
1115 of
Regulation AB. Notwithstanding the foregoing, Party A agrees that
if
future guidance from the Securities and Exchange Commission with
respect
to Item 1115 precludes the posting of collateral or otherwise limits
the
posting of collateral in reduction of the “significance percentage”, item
(4) shall cease to operate under Part 5(n)(iii).
|
(iv)
|
Party
A agrees that, in the event that Party A provides Swap Financial
Disclosure to the Depositor in accordance with clause (iii)(1)
above or
causes its affiliate to provide Swap Financial Disclosure to the
Depositor
in accordance with clause (iii)(3) above, it will indemnify and
hold
harmless the Depositor, its respective directors or officers and
any
person controlling the Depositor, from and against any and all
losses,
claims, damages and liabilities caused by any untrue statement
or alleged
untrue statement of a material fact contained in such Swap Financial
Disclosure or caused by any omission or alleged omission to state
in such
Swap Financial Disclosure a material fact required to be stated
therein or
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading.
|
(v)
|
Depositor
shall be an express third party beneficiary of this Agreement as
if a
party hereto to the extent of Depositor’s rights explicitly specified
herein.
|
(k) |
Proceedings.
Party A shall not institute against, or cause any other person
to
institute against, or join any other person in instituting against
Party
B, the Supplemental Interest Trust, or the trust formed pursuant
to the
Pooling and Servicing Agreement, in any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings or other proceedings
under any federal or state bankruptcy or similar law for a period
of one
year (or, if longer, the applicable preference period) and one
day
following payment in full of the Certificates and any Notes. This
provision will survive the termination of this Agreement.
|
(l)
|
Payment
Instructions.
Party A hereby agrees that, unless notified in writing by the Supplemental
Interest Trust Trustee of other payment instructions, any and all
amounts
payable by Party A to Party B under this Agreement shall be paid
to the
account specified in paragraph 4
below.
|
(m)
|
Supplemental
Interest Trust Trustee Liability Limitations.
It
is expressly understood and agreed by the parties hereto that (a)
this
Agreement is executed by HSBC Bank USA, National Association (“HSBC”) not
in its individual capacity, but solely as Supplemental Interest
Trust
Trustee under the Pooling and Servicing Agreement in the exercise
of the
powers and authority conferred and invested in it thereunder; (b)
HSBC has
been directed pursuant to the Pooling and Servicing Agreement to
enter
into this Agreement and to perform its obligations hereunder; (c)
each of
the representations, undertakings and agreements herein made on
behalf of
the Trust is made and intended not as personal representations
of the
Trustee but is made and intended for the purpose of binding only
the
Trust; and (d) under no circumstances shall HSBC
in its individual capacity be personally liable for any payments
hereunder
or for the breach or failure of any obligation, representation,
warranty
or covenant made or undertaken under this
Agreement.
|
(n) |
Additional
Definitions.
|
As
used
in this Agreement, the following terms shall have the meanings set forth
below,
unless the context clearly requires otherwise:
“Moody’s”
means Xxxxx’x Investors Service, Inc., or any successor.
“S&P”
means Standard & Poor’s Ratings Services, or any successor.
(o)
|
Severability.
If
any term, provision, covenant, or condition of this Agreement,
or the
application thereof to any party or circumstance, shall be held
to be
invalid or unenforceable (in whole or in part) for any reason,
the
remaining terms, provisions, covenants, and conditions hereof shall
continue in full force and effect as if this Agreement had been
executed
with the invalid or unenforceable portion eliminated, so long as
this
Agreement as so modified continues to express, without material
change,
the original intentions of the parties as to the subject matter
of this
Agreement and the deletion of such portion of this Agreement will
not
substantially impair the respective benefits or expectations of
the
parties; provided, however, that this severability provision shall
not be
applicable if any provision of Section 2, 5, 6, or 13 (or any definition
or provision in Section 14 to the extent it relates to, or is used
in or
in connection with any such Section) shall be so held to be invalid
or
unenforceable.
|
The
parties shall endeavor to engage in good faith negotiations to replace any
invalid or unenforceable term, provision, covenant or condition with a valid
or
enforceable term, provision, covenant or condition, the economic effect of
which
comes as close as possible to that of the invalid or unenforceable term,
provision, covenant or condition.
(p)
|
FDIC
Requirements.
If
Party A is a bank subject to the requirements of 12 U.S.C. § 1823(e),
Party A represents that its execution, delivery and performance
of this
Agreement (including the Credit Support Annex and each Confirmation)
have
been approved by its board of directors or its loan committee,
such
approval is reflected in the minutes of said board of directors
or loan
committee, and this Agreement (including the Credit Support Annex
and each
Confirmation) will be maintained as one of its official records
continuously from the time of its execution (or in the case of
any
Confirmation, continuously until such time as the relevant Transaction
matures and the obligations therefor are satisfied in
full).
|
(q)
|
Payments
by Party B upon Early Termination.
Notwithstanding anything to the contrary in the ISDA Form Master
Agreement, if an amount is calculated as being due in respect of
any Early
Termination Date under Section 6(e) from Party B to Party A, then
such
payment shall be due on the first succeeding Distribution Date
following
the Early Termination Date (or if such Early Termination Date is
the final
Distribution Date, on such final Distribution Date), and on any
subsequent
Distribution Dates until paid in
full.
|
4. Account
Details and Settlement Information:
Payments to Party A: |
ABN
AMRO Bank N.V., New York, ABNAUS33
CHIPS
007535
ABA
No. 000000000
A/C
Name: ABN Amro Bank N.V., London
A/C
No. 661001036741
Ref.
DCM
|
Payments
to Party B:
|
Xxxxx
Fargo Bank, N.A.
ABA
No. 000-000-000
Acct.
No. 0000000000
Acct.
Name: SAS Clearing
FFC:
NAAC 2006-AR3, 50950001
|
This
Agreement may be executed in several counterparts, each of which shall be
deemed
an original but all of which together shall constitute one and the same
instrument.
We
are
very pleased to have executed this Transaction with you and we look forward
to
completing other transactions with you in the near future.
Very
truly yours,
ABN
AMRO
Bank N.V.
By: /s/ Xxxxxx Xxxxxxx | By: /s/ Xxxxxxxx Xxxxxxx | ||
|
|
||
Name:
Xxxxxx Xxxxxxx
Title:
Authorised Signature
|
Name:
Xxxxxxxx
Xxxxxxx
Title: Authorised Signature |
Party
B,
acting through its duly authorized signatory, hereby agrees to, accepts and
confirms the terms of the foregoing as of the Trade Date.
HSBC
Bank
USA, National Association not individually, but solely as Supplemental Interest
Trust Trustee on behalf of the supplemental interest trust with respect to
the
Nomura Asset Acceptance Corporation, Alternative Loan Trust, Series 2006-AR3,
Mortgage Pass-Through Certificates.
By: /s/ Xxxxx Xxxxx | |||
|
|||
Name: Xxxxx
Xxxxx
Title:
Assistant Vice President
|
SCHEDULE
I
(all
such
dates subject to No Adjustment with respect to Fixed Rate Payer Period End
Dates
and adjustment in accordance with the Following Business Day Convention with
respect to Floating Rate Payer Period End Dates)]
From
and including
|
To
but excluding
|
Notional
Amount (USD)
|
Effective
Date
|
10/25/2006
|
472,418,000.00
|
10/25/2006
|
11/25/2006
|
459,097,789.75
|
11/25/2006
|
12/25/2006
|
432,978,863.62
|
12/25/2006
|
1/25/2007
|
411,415,887.20
|
1/25/2007
|
2/25/2007
|
390,666,482.98
|
2/25/2007
|
3/25/2007
|
371,455,819.09
|
3/25/2007
|
4/25/2007
|
353,010,487.38
|
4/25/2007
|
5/25/2007
|
335,632,598.76
|
5/25/2007
|
6/25/2007
|
319,100,536.50
|
6/25/2007
|
7/25/2007
|
303,373,139.34
|
7/25/2007
|
8/25/2007
|
288,411,248.78
|
8/25/2007
|
9/25/2007
|
274,177,611.64
|
9/25/2007
|
10/25/2007
|
260,636,787.37
|
10/25/2007
|
11/25/2007
|
247,755,059.88
|
11/25/2007
|
12/25/2007
|
235,500,353.60
|
12/25/2007
|
1/25/2008
|
223,842,153.73
|
1/25/2008
|
2/25/2008
|
212,751,430.25
|
2/25/2008
|
3/25/2008
|
202,200,565.71
|
3/25/2008
|
4/25/2008
|
192,163,286.51
|
4/25/2008
|
5/25/2008
|
182,217,216.09
|
5/25/2008
|
6/25/2008
|
172,878,624.57
|
6/25/2008
|
7/25/2008
|
151,213,250.66
|
7/25/2008
|
8/25/2008
|
143,657,557.62
|
8/25/2008
|
9/25/2008
|
136,469,695.50
|
9/25/2008
|
10/25/2008
|
129,631,760.90
|
10/25/2008
|
11/25/2008
|
123,126,721.71
|
11/25/2008
|
12/25/2008
|
116,938,374.66
|
12/25/2008
|
1/25/2009
|
111,051,305.01
|
1/25/2009
|
2/25/2009
|
105,450,848.20
|
2/25/2009
|
3/25/2009
|
100,123,053.32
|
3/25/2009
|
4/25/2009
|
92,141,490.79
|
4/25/2009
|
5/25/2009
|
87,441,918.44
|
5/25/2009
|
6/25/2009
|
82,990,674.14
|
6/25/2009
|
7/25/2009
|
77,257,838.91
|
7/25/2009
|
8/25/2009
|
68,844,596.01
|
8/25/2009
|
9/25/2009
|
65,299,283.83
|
9/25/2009
|
10/25/2009
|
61,926,586.08
|
10/25/2009
|
11/25/2009
|
60,968,110.52
|
11/25/2009
|
12/25/2009
|
57,915,843.15
|
12/25/2009
|
1/25/2010
|
55,012,189.73
|
1/25/2010
|
2/25/2010
|
52,249,915.85
|
2/25/2010
|
3/25/2010
|
49,622,139.22
|
3/25/2010
|
4/25/2010
|
47,122,312.52
|
4/25/2010
|
5/25/2010
|
44,744,207.07
|
5/25/2010
|
6/25/2010
|
42,481,897.37
|
6/25/2010
|
7/25/2010
|
40,329,746.30
|
7/25/2010
|
8/25/2010
|
38,282,315.40
|
8/25/2010
|
9/25/2010
|
36,334,585.70
|
9/25/2010
|
10/25/2010
|
34,481,703.30
|
10/25/2010
|
11/25/2010
|
32,719,050.56
|
11/25/2010
|
12/25/2010
|
31,042,234.60
|
12/25/2010
|
1/25/2011
|
29,447,076.37
|
1/25/2011
|
2/25/2011
|
27,929,600.25
|
2/25/2011
|
3/25/2011
|
26,486,024.12
|
3/25/2011
|
4/25/2011
|
25,112,749.97
|
4/25/2011
|
5/25/2011
|
23,787,289.81
|
5/25/2011
|
6/25/2011
|
22,444,309.01
|
6/25/2011
|
7/25/2011
|
17,236,006.36
|
7/25/2011
|
8/25/2011
|
4,834,366.66
|
8/25/2011
|
Termination
Date
|
4,515,519.80
|
EXHIBIT
P
ASSIGNMENT,
ASSUMPTION AND RECOGNITION AGREEMENT
This
Assignment, Assumption and Recognition Agreement (this “AAR Agreement”) is made
and entered into as of September 29, 2006 (the “Closing Date”), among Nomura
Credit & Capital, Inc., having an address at 2
World
Financial Center, Building B, 21st
Floor,
New York, New York 10281
(the
“Assignor”), Nomura Asset Acceptance Corporation, having an address at 2 World
Financial Center, Building B, 21st
Floor,
New York, New York 10281 (the “Assignee”) and Wachovia Mortgage Corporation,
having an address at 000 X. Xxxxx Xxxxxx, 00xx
Xxxxx,
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000 (the “Servicer” or the “Company”).
In
consideration of the mutual promises contained herein the parties hereto
agree
that the residential mortgage loans identified on the schedule annexed
hereto as
Attachment
1
(the
“Assigned Loans”), which are now serviced by the Servicer on behalf of the
Assignor and its successors and assigns pursuant to the Seller’s Purchase,
Warranties and Servicing Agreement, dated as of March 1, 2006 and the related
Regulation AB Compliance Addendum, dated April 12, 2006, each between the
Assignor and the Servicer (together, the “Servicing Agreement”) and attached
hereto as Attachment
2,
shall
be sold by the Assignor to the Assignee pursuant to the Mortgage Loan Purchase
Agreement, dated as of September 29, 2006 (the “MLPA”), between the Assignor and
the Assignee and subject to the terms of this AAR Agreement. The Assignee
intends to transfer all right, title and interest in and to the Assigned
Loans
and the Servicing Agreement to HSBC Bank USA, National Association, as
trustee
(the “Trustee”) for
the
holders of Nomura Asset Acceptance Corporation, Alternative Loan Trust,
Series
2006-AR3 Mortgage Pass-Through Certificates (the “Certificateholders”) pursuant
to the Pooling and Servicing Agreement, dated as of September 1, 2006 (the
“Pooling and Servicing Agreement”) among the Assignor, as sponsor, the Assignee,
as depositor, the Trustee, GMAC Mortgage Corporation as a servicer and
Xxxxx
Fargo Bank, N.A., as master servicer (the “Master Servicer”) and securities
administrator (the “Securities Administrator”).
Capitalized terms used herein but not defined shall have the meanings ascribed
to them in the Servicing Agreement.
Assignment
and Assumption
1. Assignor
hereby grants, transfers and assigns to Assignee all of the right, title
and
interest of Assignor in, to and under the Servicing Agreement as it relates
to
the Assigned Loans. Assignor specifically reserves
and does
not assign to Assignee any right, title and interest in, to or under the
Servicing Agreement, as it relates to any mortgage loans other than the
Assigned
Loans. Notwithstanding anything to the contrary contained herein, the Assignor
specifically reserves and does not assign to the Assignee the representations
and warranties contained in Sections 3.01 and 3.02 of the Servicing Agreement
or
the right to enforce the representations and warranties against the Company,
including, without limitation, the rights set forth in Section 3.03 and
3.04 of
the Servicing Agreement.
Representations,
Warranties and Covenants
2. Assignor
warrants and represents to Assignee and Servicer as of the Closing
Date:
(a) Attached
hereto as Attachment
2
is a
true and accurate copy of the Servicing Agreement, which Servicing Agreement
is
in full force and effect as of the date hereof and the provisions of which,
except as set forth herein, have not been waived, amended or modified in
any
respect, nor has any notice of termination been given thereunder;
(b) Assignor
is the lawful owner of the Assigned Loans with full right to transfer the
Assigned Loans and any and all of its interests and rights under the Servicing
Agreement as they relate to the Assigned Loans, free and clear of any and
all
claims and encumbrances; and upon the transfer of the Assigned Loans to
Assignee
under the MLPA, Assignee shall have good title to each and every Assigned
Loan,
as well as any and all of Assignor’s interests and rights under the Servicing
Agreement as they relate to the Assigned Loans, free and clear of any and
all
liens, claims and encumbrances;
(c) Assignor
is duly organized, validly existing and in good standing under the laws
of the
jurisdiction of its incorporation, and has all requisite power and authority
to
sell, transfer and assign the Assigned Loans;
(d) Assignor
has full corporate power and authority to execute, deliver and perform
its
obligations under this AAR Agreement, and to consummate the transactions
set
forth herein. The consummation of the transactions contemplated by this
AAR
Agreement is in the ordinary course of Assignor’s business and will not conflict
with, or result in a breach of, any of the terms, conditions or provisions
of
Assignor’s certificate of incorporation or bylaws or any legal restriction, or
any material agreement or instrument to which Assignor is now a party or
by
which it is bound, or result in the violation of any law, rule, regulation,
order, judgment or decree to which Assignor or its property is subject.
The
execution, delivery and performance by Assignor of this AAR Agreement and
the
consummation by it of the transactions contemplated hereby, have been duly
authorized by all necessary corporate action on the part of Assignor. This
AAR
Agreement has been duly executed and delivered by Assignor and, upon the
due
authorization, execution and delivery by Assignee and Servicer, will constitute
the valid and legally binding obligation of Assignor enforceable against
Assignor in accordance with its terms except as enforceability may be limited
by
bankruptcy, reorganization, insolvency, moratorium or other similar laws
now or
hereafter in effect relating to creditors’ rights generally, and by general
principles of equity regardless of whether enforceability is considered
in a
proceeding in equity or at law; and
(e) No
consent, approval, order or authorization of, or declaration, filing or
registration with, any governmental entity is required to be obtained or
made by
Assignor in connection with the execution, delivery or performance by Assignor
of this AAR Agreement, or the consummation by it of the transactions
contemplated hereby.
3. Assignee
warrants and represents to, and covenants with, Assignor and Servicer as
of the
Closing Date:
(a) Assignee
is duly organized, validly existing and in good standing under the laws
of the
jurisdiction of its incorporation and has all requisite power and authority
to
acquire, own and purchase the Assigned Loans;
(b) Assignee
has full corporate power and authority to execute, deliver and perform
its
obligations under this AAR Agreement, and to consummate the transactions
set
forth herein. The consummation of the transactions contemplated by this
AAR
Agreement is in the ordinary course of Assignee’s business and will not conflict
with, or result in a breach of, any of the terms, conditions or provisions
of
Assignee’s certificate of incorporation or by-laws or any legal restriction, or
any material agreement or instrument to which Assignee is now a party or
by
which it is bound, or result in the violation of any law, rule, regulation,
order, judgment or decree to which Assignee or its property is subject.
The
execution, delivery and performance by Assignee of this AAR Agreement and
the
consummation by it of the transactions contemplated hereby, have been duly
authorized by all necessary corporate action on the part of Assignee. This
AAR
Agreement has been duly executed and delivered by Assignee and, upon the
due
authorization, execution and delivery by Assignor and the Servicer, will
constitute the valid and legally binding obligation of Assignee enforceable
against Assignee in accordance with its terms except as enforceability
may be
limited by bankruptcy, reorganization, insolvency, moratorium or other
similar
laws now or hereafter in effect relating to creditors’ rights generally, and by
general principles of equity regardless of whether enforceability is considered
in a proceeding in equity or at law;
(c) No
consent, approval, order or authorization of, or declaration, filing or
registration with, any governmental entity is required to be obtained or
made by
Assignee in connection with the execution, delivery or performance by Assignee
of this AAR Agreement, or the consummation by it of the transactions
contemplated hereby; and
(d) Assignee
agrees to be bound by all of the terms, covenants and conditions of the
Servicing Agreement, as modified by this AAR Agreement, with respect to
the
Assigned Loans.
4. The
Servicer warrants and represents to, and covenants with, Assignor and Assignee
as of the Closing Date:
(a) Attached
hereto as Attachment
2
is a
true and accurate copy of the Servicing Agreement, which Servicing Agreement
is
in full force and effect as of the Closing Date and the provisions of which,
except as set forth herein, have not been waived, amended or modified in
any
respect, nor has any notice of termination been given thereunder;
(b) The
Servicer is duly organized, validly existing and in good standing under
the laws
of the United States of America, and has all requisite power and authority
to
service the Assigned Loans and otherwise to perform its obligations under
the
Servicing Agreement, as modified by this AAR Agreement;
(c) The
Servicer has full power and authority to execute, deliver and perform its
obligations under this AAR Agreement, and to consummate the transactions
set
forth herein. The consummation of the transactions contemplated by this
AAR
Agreement is in the ordinary course of the Servicer’s business and will not
conflict with, or result in a breach of, any of the terms, conditions or
provisions of the Servicer’s charter or by-laws or any legal restriction, or any
material agreement or instrument to which the Servicer is now a party or
by
which it is bound, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Servicer or its property is subject.
The
execution, delivery and performance by the Servicer of this AAR Agreement
and
the consummation by it of the transactions contemplated hereby, have been
duly
authorized by all necessary action on the part of the Servicer. This AAR
Agreement has been duly executed and delivered by the Servicer, and, upon
the
due authorization, execution and delivery by Assignor and Assignee, will
constitute the valid and legally binding obligation of the Servicer, enforceable
against the Servicer in accordance with its terms except as enforceability
may
be limited by bankruptcy, reorganization, insolvency, moratorium or other
similar laws now or hereafter in effect relating to creditors’ rights generally,
and by general principles of equity regardless of whether enforceability
is
considered in a proceeding in equity or at law;
(d) No
consent, approval, order or authorization of, or declaration, filing or
registration with, any governmental entity is required to be obtained or
made by
the Servicer in connection with the execution, delivery or performance
by the
Servicer of this AAR Agreement, or the consummation by it of the transactions
contemplated hereby; and
(e) The
Servicer shall service the Assigned Loans in accordance with the terms
and
provisions of the Servicing Agreement, as modified by this AAR Agreement.
The
Servicer shall establish a Custodial Account and an Escrow Account under
the
Servicing Agreement with respect to the Assigned Loans separate from the
Custodial Account and Escrow Account previously established under the Servicing
Agreement in favor of Assignor, and shall remit collections received on
the
Assigned Loans to the appropriate account as required by the Servicing
Agreement. The Custodial Account and the Escrow Account each shall be entitled
“Wachovia Mortgage Corporation, as Servicer for HSBC Bank USA, National
Association as Trustee, in trust for the registered holders of Nomura Asset
Acceptance Corporation, Alternative Loan Trust,
Series
2006-AR3”
and
each shall be established and maintained as an Eligible Account. Any funds
held
in the Custodial Account are and shall remain uninvested.
Recognition
of Assignee.
5. From
and
after the date hereof, Servicer shall recognize Assignee as owner of the
Assigned Loans, and acknowledges that the Assigned Loans will be part of
a
REMIC, and will service the Assigned Loans in accordance with the Servicing
Agreement, as modified by this AAR Agreement, but in no event in a manner
that
would (i) cause any REMIC to fail to qualify as a REMIC or (ii) result
in the
imposition of a tax upon any REMIC (including but not limited to the tax
on
prohibited transactions as defined in Section 860F(a)(2) of the Internal
Revenue
Code of 1986 (the “Code”) and the tax on contributions to a REMIC set forth in
Section 860G(d) of the Code). It is the intention of Assignor, Servicer
and
Assignee that this AAR Agreement shall be binding upon and for the benefit
of
the respective successors and assigns of the parties hereto. Neither Servicer
nor Assignor shall amend or agree to amend, modify, waive, or otherwise
alter
any of the terms or provisions of the Servicing Agreement which amendment,
modification, waiver or other alteration would in any way affect the Assigned
Loans without the prior written consent of the Master Servicer and Trustee.
6. The
Servicer hereby acknowledges that the Master Servicer, acting pursuant
to the
terms of the Pooling and Servicing Agreement, has the right to enforce
all
obligations of the Servicer, as they relate to the Assigned Loans, under
the
Servicing Agreement. Such right will include, without limitation, the right
to
indemnification, the right to terminate the Servicer under the Servicing
Agreement upon the occurrence of an Event of Default thereunder and the
right to
exercise certain rights of consent and approval relating to actions taken
by the
Servicer under the Servicing Agreement. In addition, any notice required
to be
given by the “Purchaser” pursuant to Section 8.01 of the Servicing Agreement
shall be given by the Master Servicer or the Trustee. The Servicer further
acknowledges that pursuant to the terms of the Pooling and Servicing Agreement,
the Master Servicer is required to monitor the performance of the Servicer
under
the Servicing Agreement. The Master Servicer shall have the right to receive
all
remittances required to be made by the Servicer under the Servicing Agreement,
the right to receive all monthly reports and other data required to be
delivered
by the Servicer under the Servicing Agreement, the right to examine the
books
and records of the Servicer under the Servicing Agreement and the right
to
indemnification under the Servicing Agreement. In addition, if the Servicer
shall fail to remit any payment pursuant to the Servicing Agreement, the
Master
Servicer shall notify the Trustee and the Servicer of such failure as set
forth
in Section 8.01 of the Servicing Agreement. The Servicer hereby agrees
to make
all remittances required under the Servicing Agreement to the Master Servicer
for the benefit of the Certificateholders in accordance with the following
wire
instructions:
Xxxxx
Fargo Bank, N.A.
ABA:
000000000
Acct
#:
0000000000
Acct
Name: SAS Clearing
For
Further Credit to: NAAC 2006-AR3 Account #00000000
7. Pursuant
to Section 10.01(b) of the Servicing Agreement, the Servicer hereby makes
the
representations and warranties set forth in Section 3.01 of the Servicing
Agreement as of the Closing Date.
8. In
the
event that the Assignor substitutes any Deleted Mortgage Loans with any
Qualified Substitute Mortgage Loans in the manner set forth in the Pooling
and
Servicing Agreement, the Assignor shall determine the amount (the “Substitution
Shortfall Amount”), if any, by which the aggregate purchase price of all such
Deleted Mortgage Loans exceeds the aggregate of, as to each such Qualified
Substitute Mortgage Loan, (x) the scheduled principal balance thereof as
of the
date of substitution, together with one month’s interest on such scheduled
principal balance at the applicable Mortgage Interest Rate (minus the
Administration Fee Rate (as defined below)), plus (y) all outstanding Monthly
Advances and Servicing Advances (including nonrecoverable Monthly Advances
and
nonrecoverable Servicing Advances) related thereto; provided, however,
if the
Servicer repurchases the Deleted Mortgage Loan, the amounts set forth in
clause
(y) shall not be included in the calculation of the Substitution Shortfall
Amount. On the date of such substitution, the Assignor will deliver or
cause to
be delivered to the Servicer for deposit in the Custodial Account an amount
equal to the Substitution Shortfall Amount, if any, and the Servicer shall
acknowledge in writing (or electronic format) to the Trustee that it has
received such Substitution Shortfall Amount from the Assignor. The Servicer
shall remit such Substitution Shortfall Amount to the Securities Administrator
on the next succeeding Servicer Remittance Date. As used in this Section,
the
“Administration Fee Rate” means the sum of the rates used to calculate the fees
payable to the Servicer and the credit risk manager under the Pooling and
Servicing Agreement.
Modification
of the Servicing Agreement
9. The
Servicer and Assignor hereby amend the Servicing Agreement with respect
to the
Assigned Loans as follows:
(a) The
following definitions are added to Article I of the Servicing Agreement
in
alphabetical order:
“Authorized
Servicer Representative”:
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 and the Master Servicer
by
the Servicer on the closing date of any securitization transaction, as
such list
may from time to time be amended.
“Certificate”:
Any
one of the certificates of any class executed and authenticated by the
Securities Administrator and issued in connection with the NAAC 2006-AR3
transaction.
“Commission”:
The
United States Securities and Exchange Commission.
“Depositor”:
Nomura
Asset Acceptance Corporation.”
“Distribution
Date”:
The
25th
day of
any month, or if such 25th
day is
not a Business Day, the Business Day immediately following such 25th
day,
commencing in October 2006.
“Master
Servicer”:
Xxxxx
Fargo Bank, National Association or any successor thereto.”
“Nonrecoverable
Advance”:
With
respect to any Mortgage Loan, any portion of a Monthly Advance or Servicing
Advance previously made or proposed to be made by the Seller pursuant to
this
Agreement that, in the good faith judgment of the Seller, will not or,
in the
case of a proposed Monthly Advance or Servicing Advance, would not, be
ultimately recoverable by it from the related Mortgagor, related Liquidation
Proceeds, Insurance Proceeds or otherwise.
“Prepayment
Period”:
With
respect to any Distribution Date, the calendar month preceding the month
in
which such Distribution Date occurs.
“REMIC
Provisions”:
Provisions of the federal income tax law relating to real estate mortgage
investment conduits, which appear at Sections 860A through 860G of Subchapter
M
of Chapter 1 of the Code, and related provisions, and proposed, temporary
and
final regulations and published rulings, notices and announcements promulgated
thereunder, as the foregoing may be in effect from time to time as well
as
provisions of applicable state laws.
“Securities
Administrator”:
Xxxxx
Fargo Bank, National Association or any successor thereto.
“Sponsor”:
Nomura
Credit and Capital, Inc.
“Trust”:
Nomura
Asset Acceptance Corporation, Alternative Loan Trust, Series
2006-AR3.
“Trustee”:
HSBC
Bank USA, National Association a national banking association, or its successor
in interest, or any successor trustee.
(b) The
definition of “Business Day” in Article I of the Servicing Agreement is modified
by replacing clause (ii) with the following:
“(ii)
a
day on which banking institutions in the State of New York, the State of
Maryland, the State of Iowa, the State of California, the State of Minnesota,
the State of North Carolina and the State in which any Corporate Trust
Office of
the Trustee is located are authorized or obligated by law or executive
order to
be closed.”
(c) The
definition of “Eligible Account” in Article I of the Servicing Agreement is
deleted in its entirety and replaced with the following:
“Eligible
Account”:
Any of
(i) an account or accounts maintained with a federal or state chartered
depository institution or trust company, the long-term unsecured debt
obligations and short-term unsecured debt obligations of which are rated
by each
Rating Agency in one of its two highest long-term and its highest short-term
rating categories respectively, at the time any amounts are held on deposit
therein, or (ii) an account or accounts in a depository institution or
trust
company in which such accounts are insured by the FDIC (to the limits
established by the FDIC) and the uninsured deposits in which accounts are
otherwise secured such that, as evidenced by an Opinion of Counsel delivered
to
the Trustee and to each Rating Agency, the Certificateholders have a claim
with
respect to the funds in such account or a perfected first priority security
interest against any collateral (which shall be limited to Eligible Investments)
securing such funds that is superior to claims of any other depositors
or
creditors of the depository institution or trust company in which such
account
is maintained, or (iii) a segregated, non-interest bearing trust account
or
accounts maintained with the corporate trust department of a federal or
state
chartered depository institution or trust company having capital and surplus
of
not less than $50,000,000, acting in its fiduciary capacity or (iv) any
other
account acceptable to the Rating Agencies as evidenced in writing by the
Rating
Agencies. Eligible Accounts may bear interest, and may include, if otherwise
qualified under this definition, accounts maintained with the Trustee or
Securities Administrator.
(d) The
definition of “Eligible Institution” in Article I of the Servicing Agreement is
deleted in its entirety.
(e) The
definition of “Eligible Investment” in Article I of the Servicing Agreement is
deleted in its entirety and replaced with the following:
At
any
time, any one or more of the following obligations and securities:
(i) direct
obligations of, or obligations fully guaranteed as to timely payment of
principal and interest by, the United States or any agency thereof, provided
such obligations are unconditionally backed by the full faith and credit
of the
United States;
(ii) general
obligations of or obligations guaranteed by any state of the United States
or
the District of Columbia receiving the highest long-term debt rating of
each
Rating Agency, or such lower rating as will not result in the downgrading
or
withdrawal of the ratings then assigned to the Certificates by each Rating
Agency, as evidenced by a signed writing delivered by each Rating
Agency;
(iii) commercial
or finance company paper which is then receiving the highest commercial
or
finance company paper rating of each Rating Agency that rates such securities,
or such lower rating as will not result in the downgrading or withdrawal
of the
ratings then assigned to the Certificates by each Rating Agency, as evidenced
by
a signed writing delivered by each Rating Agency;
(iv) certificates
of deposit, demand or time deposits, or bankers’ acceptances issued by any
depository institution or trust company incorporated under the laws of
the
United States or of any state thereof and subject to supervision and examination
by federal and/or state banking authorities (including the Trustee or the
Master
Servicer in its commercial banking capacity), provided that the commercial
paper
and/or long term unsecured debt obligations of such depository institution
or
trust company are then rated one of the two highest long-term and the highest
short-term ratings of each such Rating Agency for such securities, or such
lower
ratings as will not result in the downgrading or withdrawal of the rating
then
assigned to the Certificates by any Rating Agency, as evidenced by a signed
writing delivered by each Rating Agency;
(v) demand
or
time deposits or certificates of deposit issued by any bank or trust company
or
savings institution to the extent that such deposits are fully insured
by the
FDIC;
(vi) guaranteed
reinvestment agreements issued by any bank, insurance company or other
corporation containing, at the time of the issuance of such agreements,
such
terms and conditions as will not result in the downgrading or withdrawal
of the
rating then assigned to the Certificates by any such Rating Agency, as
evidenced
by a signed writing delivered by each Rating Agency;
(vii) repurchase
obligations with respect to any security described in clauses (i) and (ii)
above, in either case entered into with a depository institution or trust
company (acting as principal) described in clause (v) above;
(viii) securities
(other than stripped bonds, stripped coupons or instruments sold at a purchase
price in excess of 115% of the face amount thereof) bearing interest or
sold at
a discount issued by any corporation incorporated under the laws of the
United
States or any state thereof which, at the time of such investment, have
one of
the two highest long term ratings of each Rating Agency, or such lower
rating as
will not result in the downgrading or withdrawal of the rating then assigned
to
the Certificates by any Rating Agency, as evidenced by a signed writing
delivered by each Rating Agency;
(ix) units
of
money market funds registered under the Investment Company Act of 1940
including
funds managed or advised by the Trustee, the Master Servicer or an affiliate
of
either, having a rating by S&P of AAAm-G or AAAm, if rated by Moody’s, rated
Aaa, Aa1 or Aa2, and if rated by Fitch, F1, F2 or F3;
(x) short
term investment funds sponsored by any trust company or banking association
incorporated under the laws of the United States or any state thereof (including
any such fund managed or advised by the Trustee, the Master Servicer or
any
affiliate thereof) which on the date of acquisition has been rated by each
Rating Agency in their respective highest applicable rating category or
such
lower rating as will not result in the downgrading or withdrawal of the
ratings
then assigned to the Certificates by each Rating Agency, as evidenced by
a
signed writing delivered by each Rating Agency; and
(xi) such
other investments having a specified stated maturity and bearing interest
or
sold at a discount acceptable to each Rating Agency as will not result
in the
downgrading or withdrawal of the rating then assigned to the Certificates
by any
Rating Agency, as evidenced by a signed writing delivered by each Rating
Agency,
as evidenced by a signed writing delivered by each Rating Agency;
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.
(f) The
definition of “Officer’s Certificate” in Article I of the Servicing Agreement is
modified by adding “(i)” at the beginning thereof and the following after the
word “Agreement”:
“,
or
(ii) if provided for in this Agreement, signed by an Authorized Servicer
Representative, as the case may be, and delivered to the Depositor, the
Sponsor,
the Master Servicer, the Securities Administrator and/or the Trustee, as
the
case may be, as required by this Agreement.”
(g) The
definition of “Opinion of Counsel” in Article I of the Servicing Agreement is
modified by replacing such definition with the following:
“Opinion
of Counsel”:
A
written opinion of counsel, who may, without limitation, be salaried counsel
for
the Depositor, the Company, the Securities Administrator or the Master
Servicer,
acceptable to the Trustee, except that any opinion of counsel relating
to (a)
the qualification of any REMIC as a REMIC or (b) compliance with the REMIC
Provisions must be an opinion of independent counsel.
(h) The
definition of “Rating Agency” in Article I of the Servicing Agreement is
modified by replacing such definition with the following:
“Rating
Agencies”:
Xxxxx’x Investors Services, Inc. and Standard & Poor’s Ratings Services, a
division of the McGraw Hill Companies, Inc. or their successors. If such
agencies or their successors are no longer in existence, “Rating Agencies” shall
be such nationally recognized statistical rating agencies, or other comparable
Persons, designated by the Depositor, notice of which designation shall
be given
to the Trustee.”
(i) The
definition of “Remittance Date” is deleted in its entirety and replaced with the
following:
“Remittance
Date”:
The
18th
day of
each month, or if such day is not a Business Day, the Business Day immediately
preceding such 18th
day of
the month.
(j) The
definition of “Servicing Fee Rate” shall be deleted in its entirety and replaced
with the following:
“Servicing
Fee Rate”:
0.375%
per annum.
(k) The
first
sentence of the third paragraph of Section 4.01 of the Servicing Agreement
is
modified by inserting the phrase “, other than Servicing Advances,” immediately
after the words “any future advances”.
(l) Section
4.04(i) of the Servicing Agreement is amended by adding “in full and in part
collected during the related Prepayment Period” after “including Principal
Prepayments”.
(m) Section
4.04 of the Servicing Agreement is modified by deleting the following from
the
parenthetical in the last paragraph of such Section: “except that (A) any
investment in the Eligible Institution with which the Custodial Account
is
maintained may mature on the Remittance Date and (B)”.
(n) Section
4.05 of the Servicing Agreement is modified by deleting the word “and” at the
end of clause (viii), deleting the “.” at the end of clause (ix) and adding “;”
and adding the following clauses: “(x) to reimburse itself for any Monthly
Advance or Servicing Advance previously made by it which the Seller has
determined to be a Nonrecoverable Advance, as evidenced by the delivery
to the
Master Servicer of a certificate signed by an officer of the
Seller”.
(o) Section
4.13 of the Servicing Agreement is modified by deleting from the last paragraph
of such Section, the first two sentences of such paragraph.
(p) Article
IV of the Servicing Agreement is modified by adding the following as a
new
Section 4.15 “Compliance with REMIC Provisions”:
“Section
4.15 Compliance
with REMIC Provisions.
Notwithstanding anything in this Agreement to the contrary, the Seller
shall not
(unless the Mortgagor is in default with respect to the Mortgage Loan or
such
default is, in the judgment of the Seller, reasonably foreseeable) make
or
permit any modification, waiver or amendment of any term of any Mortgage
Loan
that would both (i) effect an exchange or reissuance of such Mortgage Loan
under
Section 1001 of the Code (or Treasury regulations promulgated thereunder)
or
(ii) cause the Trust to fail to qualify as a REMIC under the Code or the
imposition of any tax on “prohibited transactions” or “contributions” after the
startup date under the REMIC Provisions.
The
Seller will not take any action that could result in the imposition of
a tax
upon the REMIC (including but not limited to the tax on prohibited transactions
as defined in Section 860F(a)(2) of the Code and the tax on contributions
to a
REMIC set forth in Section 860G(d) of the Code) (either such event, an
“Adverse
REMIC Event”) and the Seller shall not take cause the Trust Fund to take any
such action as to which it has been advised that an Adverse REMIC Event
could
occur.
The
Seller shall not permit the creation of any “interests” (within the meaning of
Section 860G of the Code) in the REMIC. The Seller shall not enter into
any
arrangement by which the REMIC will receive a fee or other compensation
for
services nor permit the REMIC to receive any income from assets other than
“qualified mortgages” as defined in Section 860G(a)(3) of the Code or “permitted
investments” as defined in Section 860G(a)(5) of the Code.
(q) Section
5.01 of the Servicing Agreement is modified by changing each reference
to
“Custodial Account” to “related “Custodial Account”.
(r) Section
5.01 of the Servicing Agreement is modified by deleting “following the Business
Day” from the first sentence before “on which such payment was due” and deleting
from the second sentence “second” after “the day following the”.
(s) Section
5.02 of the Servicing Agreement is modified by deleting the first paragraph
of
such Section (including subsections (i) through (vi)) and replacing it
with the
following:
“The
Seller shall furnish to the Purchaser an individual loan accounting report,
as
of the last Business Day of each month, in the Seller’s assigned loan number
order to document Mortgage Loan payment activity, defaulted loan activity
and
realized losses on an individual Mortgage Loan basis. With respect to each
month, the corresponding individual loan accounting report shall be received
by
the Purchaser no later than the fifth (5th) Business Day of the following
month
in a format mutually agreed upon by both the Purchaser and the Seller and
in
hard copy, which report shall contain the information set forth in Exhibit
G (or
such other information as is mutually agreed upon by the Seller and the
Purchaser).”
(t) Section
6.07 of the Servicing Agreement is modified by adding to the first sentence
“(including documentation relating to expenses contributing to a realized
loss)”
after “The Seller shall furnish to the Purchaser during the term of this
Agreement such periodic, special or other reports, information or
documentation”.
(u) Section
7.01 of the Servicing Agreement is deleted in its entirety and replaced
with the
following:
“The
Seller agrees to indemnify the Purchaser and the Master Servicer and hold
them
harmless against any and all claims, losses, damages, penalties, fines,
forfeitures, legal fees and related costs, judgments, and any other costs,
fees
and expenses (collectively, “Damages”)
that
the Purchaser or the Master Servicer may sustain in any way related to
the
failure of the Seller to observe and perform its duties, obligations, covenants,
and agreements and to service the Mortgage Loans in compliance with the
terms of
this Agreement or as a result of the breach of a representation or warranty
set
forth in Sections 3.01 or 3.02 of this Agreement. The Seller hereunder
shall
immediately notify the Purchaser and the Master Servicer if a claim is
made by a
third party with respect to this Agreement or a Mortgage Loan, assume (with
the
consent of the Purchaser or the Master Servicer, as applicable) the defense
of
any such claim and pay all expenses in connection therewith, including
counsel
fees, and promptly pay, discharge and satisfy any judgment or decree which
may
be entered against it or the Purchaser or the Master Servicer in respect
of such
claim. The Seller shall follow any written instructions received from the
Purchaser or the Master Servicer in connection with such claim. The Purchaser
or
the Master Servicer shall promptly reimburse the Seller for all amounts
advanced
by it pursuant to the two preceding sentences solely from amounts on deposit
in
the related Custodial Account (as described below), except when the claim
relates to the failure of the Seller to service and administer the Mortgage
Loans in compliance with the terms of this Agreement, the failure of the
Seller
to perform its duties and obligations pursuant to this Agreement, the breach
of
representation or warranty set forth in Sections 3.01 or 3.02, or the
negligence, bad faith or willful misconduct of the Seller. The provisions
of
this Section 7.01 shall survive termination of this Agreement and transfer
of
the related servicing rights.”
(v) The
following shall be added as a new Section 11.20 to the Servicing
Agreement:
“Section
11.20. Third
Party Beneficiary.
For
purposes of this Agreement, any master servicer and trustee shall be considered
a third party beneficiary to this Agreement entitled to all the rights
and
benefits accruing to any master servicer or trustee, respectively, herein
as if
it were a direct party to this Agreement.
(w) The
Servicing Agreement is modified by adding a new Exhibit G, which shall
include
the information set forth on Attachment
3
hereto
or in such other format mutually agreed upon by the Company and the Master
Servicer.
(x) Section
2.07(a) of the Regulation AB Addendum is modified by adding “(including, but not
limited to, any Master Servicer)” after “each Person”.
(y) Exhibit
B
of the Regulation AB Addendum is modified by adding “X” next to the
following:
1122(d)(3)(ii)
|
Amounts
due to investors are allocated and remitted in accordance with
timeframes,
distribution priority and other terms set forth in the transaction
agreements.
|
X
|
1122(d)(3)(iii)
|
Disbursements
made to an investor are posted within two business days to the
Servicer’s
investor records, or such other number of days specified in the
transaction agreements.
|
X
|
1122(d)(3)(iv)
|
Amounts
remitted to investors per the investor reports agree with cancelled
checks, or other form of payment, or custodial bank
statements.
|
X
|
1122(d)(4)(i)
|
Collateral
or security on mortgage loans is maintained as required by the
transaction
agreements or related mortgage loan documents.
|
X
|
1122(d)(4)(ii)
|
Mortgage
loan and related documents are safeguarded as required by the
transaction
agreements
|
X
|
1122(d)(4)(iii)
|
Any
additions, removals or substitutions to the asset pool are made,
reviewed
and approved in accordance with any conditions or requirements
in the
transaction agreements.
|
X
|
Miscellaneous
10. All
demands, notices and communications related to the Assigned Loans, the
Servicing
Agreement and this AAR Agreement shall be in writing and shall be deemed
to have
been duly given if personally delivered at or mailed by registered mail,
postage
prepaid, as follows:
(a) In
the
case of Assignor,
Nomura
Credit & Capital, Inc.
2
World
Financial Center, Building B, 18th
Floor
New
York,
New York 10281
Attn:
Legal Department
(b) In
the
case of Assignee,
Nomura
Asset Acceptance Corporation
2
World
Financial Xxxxxx
Xxxxxxxx
X, 00xx
Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
Legal Department
(c) In
the
case of Master Servicer,
Xxxxx
Fargo Bank, N.A.
0000
Xxx
Xxxxxxxxx Xxxx
Xxxxxxxx,
Xxxxxxxx 00000
Attention:
Client Manager - NAAC 2006-AR3
Telecopier:
(000) 000-0000
(d) In
the
case of Servicer,
Wachovia
Mortgage Corporation
000
X.
Xxxxx Xx., 00xx Xxxxx
Xxxxxxxxx,
XX 00000
Attn:
Xxxxxx Xxxxxx
Ph:
(000)
000-0000
Fax:
(000) 000-0000
11. Each
party will pay any commissions, fees and expenses, including attorney’s fees, it
has incurred in connection with the negotiations for, documenting of and
closing
of the transactions contemplated by this AAR Agreement.
12. This
AAR
Agreement shall be construed in accordance with the laws of the State of
New
York, without regard to conflicts of law principles, and the obligations,
rights
and remedies of the parties hereunder shall be determined in accordance
with
such laws.
13. No
term
or provision of this AAR Agreement may be waived or modified unless such
waiver
or modification is in writing and signed by the party against whom such
waiver
or modification is sought to be enforced.
14. This
AAR
Agreement shall inure to the benefit of the successors and assigns of the
parties hereto. Any entity into which Assignor, Assignee or Company may
be
merged or consolidated shall, without the requirement for any further writing,
be deemed Assignor, Assignee or Company, respectively, hereunder.
15. This
AAR
Agreement shall survive the conveyance of the Assigned Loans, the assignment
of
the Servicing Agreement to the extent of the Assigned Loans by Assignor
to
Assignee and the termination of the Servicing Agreement.
16. This
AAR
Agreement may be executed simultaneously in any number of counterparts.
Each
counterpart shall be deemed to be an original and all such counterparts
shall
constitute one and the same instrument.
17. In
the
event that any provision of this AAR Agreement conflicts with any provision
of
the Servicing Agreement with respect to the Assigned Loans, the terms of
this
AAR Agreement shall control.
18. For
purposes of this AAR Agreement, the Trustee and the Master Servicer shall
be
considered third party beneficiaries to this Agreement entitled to all
the
rights and benefits accruing to the Trustee and the Master Servicer, as
applicable, herein as if it were a direct party to this AAR
Agreement.
IN
WITNESS WHEREOF, the parties hereto have executed this AAR Agreement as
of the
day and year first above written.
NOMURA
CREDIT & CAPITAL, INC.
Assignor
By: /s/ Xxxxxxx X.X. Xxxxxxx | |||
|
|||
Name:
Xxxxxxx X.X. Xxxxxxx
Title:
Vice President
|
NOMURA
ASSET ACCEPTANCE CORPORATION
Assignee
By: /s/ Xxxx X. Xxxxxx | |||
|
|||
Name:
Xxxx X. Xxxxxx
Title:
President
|
WACHOVIA
MORTGAGE CORPORATION
Servicer
By: /s/ Xxxxxxx X. Xxxxxx | |||
|
|||
Name:
Xxxxxxx X. Xxxxxx
Title:
Vice President
|
ACKNOWLEDGED
AND AGREED TO:
HSBC
BANK
USA, NATIONAL ASSOCIATION
Trustee
for the holders of the Nomura Asset Acceptance Corporation,
Alternative
Loan Trust, Series 2006-AR3 Mortgage Pass-Through Certificates
By: /s/ Xxxxx Xxxxx | |||
|
|||
Name:
Xxxxx Xxxxx
Title:
Assistant Vice President
|
ACKNOWLEDGED
AND AGREED TO:
XXXXX
FARGO BANK, N.A.
Master
Servicer
By: /s/ Xxx Xxxxx | |||
|
|||
Name:
Xxx Xxxxx
Title:
Vice President
|
ATTACHMENT
1
ASSIGNED
LOAN SCHEDULE
[To
Be
Provided Upon Request]
ATTACHMENT
2
SELLER’S
WARRANTIES AND SERVICING AGREEMENT
Execution
Version
|
NOMURA
CREDIT & CAPITAL, INC.
Purchaser,
WACHOVIA
MORTGAGE CORPORATION
Seller
SELLER’S
PURCHASE, WARRANTIES AND SERVICING AGREEMENT
Dated
as
of March 1, 2006
TABLE
OF CONTENTS
ARTICLE
I
DEFINITIONS
Section
1.01. Defined
Terms.
ARTICLE
II
SERVICING OF MORTGAGE LOANS; RECORD TITLE AND POSSESSION OF MORTGAGE FILES;
BOOKS AND RECORDS; CUSTODIAL AGREEMENT; DELIVERY OF MORTGAGE LOAN
DOCUMENTS
Section
2.01. Agreement
to Purchase.
Section
2.02. Purchase
Price.
Section
2.03. Servicing
of Mortgage Loans.
Section
2.04. Record
Title and Possession of Mortgage Files; Maintenance of Servicing
Files.
Section
2.05. Books
and
Records.
Section
2.06. Transfer
of Mortgage Loans.
Section
2.07. Delivery
of Mortgage Loan Documents.
Section
2.08. Quality
Control Procedures.
Section
2.09. Closing.
ARTICLE
III
REPRESENTATIONS AND WARRANTIES OF THE SELLER; REPURCHASE; REVIEW OF MORTGAGE
LOANS
Section
3.01. Representations
and Warranties of the Seller.
Section
3.02. Representations
and Warranties as to Individual Mortgage Loans.
Section
3.03. Repurchase;
Substitution.
Section
3.04. Purchase
Price Protection.
ARTICLE
IV
ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS
Section
4.01. The
Seller to Act as Servicer.
Section
4.02. Collection
of Mortgage Loan Payments.
Section
4.03. Realization
Upon Defaulted Mortgage Loans.
Section
4.04. Establishment
of Custodial Accounts; Deposits in Custodial Accounts.
Section
4.05. Permitted
Withdrawals From the Custodial Account.
Section
4.06. Establishment
of Escrow Accounts; Deposits in Accounts.
Section
4.07. Permitted
Withdrawals From the Escrow Account.
Section
4.08. Payment
of Taxes, Insurance and Charges; Maintenance of Primary Mortgage Insurance;
Collections Thereunder.
Section
4.09. Transfer
of Accounts.
Section
4.10. Maintenance
of Hazard Insurance.
Section
4.11. Maintenance
of Mortgage Impairment Insurance Policy.
Section
4.12. Maintenance
of Fidelity Bond and Errors and Omissions Insurance.
Section
4.13. Title,
Management and Disposition of REO Property.
Section
4.14. Notification
of Maturity Date.
ARTICLE
V
PAYMENTS
TO THE PURCHASER
Section
5.01. Distributions.
Section
5.02. Statements
to the Purchaser.
Section
5.03. Monthly
Advances by the Seller.
Section
5.04. Liquidation
Reports.
ARTICLE
VI
GENERAL
SERVICING PROCEDURES
Section
6.01. Assumption
Agreements.
Section
6.02. Satisfaction
of Mortgages and Release of Mortgage Files.
Section
6.03. Servicing
Compensation.
Section
6.04. [Annual
Statement as to Compliance.
Section
6.05. [Annual
Independent Certified Public Accountants’ Servicing Report.
Section
6.06. Purchaser’s
Right to Examine Seller Records.
Section
6.07. Seller
Shall Provide Information as Reasonably Required.
ARTICLE
VII
THE
SELLER
Section
7.01. Indemnification;
Third Party Claims.
Section
7.02. Merger
or
Consolidation of the Seller.
Section
7.03. Limitation
on Liability of the Seller and Others.
Section
7.04. Seller
Not to Resign.
Section
7.05. No
Transfer of Servicing.
ARTICLE
VIII
DEFAULT
Section
8.01. Events
of
Default.
Section
8.02. Waiver
of
Defaults.
ARTICLE
IX
TERMINATION
Section
9.01. Termination.
ARTICLE
X
RECONSTITUTION OF MORTGAGE LOANS
Section
10.01. Reconstitution
of Mortgage Loans.
ARTICLE
XI
MISCELLANEOUS PROVISIONS
Section
11.01. Successor
to the Seller.
Section
11.02. Amendment.
Section
11.03. Recordation
of Agreement.
Section
11.04. Governing
Law.
Section
11.05. Notices.
Section
11.06. Severability
of Provisions.
Section
11.07. Exhibits.
Section
11.08. General
Interpretive Principles.
Section
11.09. Reproduction
of Documents.
Section
11.10. Confidentiality
of Information.
Section
11.11. Recordation
of Assignments of Mortgage.
Section
11.12. Assignment
by Purchaser.
Section
11.13. No
Partnership.
Section
11.14. Execution;
Successors and Assigns.
Section
11.15. Entire
Agreement.
Section
11.16. No
Solicitation.
Section
11.17. Costs.
Section
11.18. Protection
of Mortgagor Personal Information.
EXHIBITS
A-1 |
Contents
of Mortgage File
|
A-2 |
Contents
of Servicing File
|
B |
Form
of Custodial Account Letter
Agreement
|
C |
Form
of Escrow Account Letter Agreement
|
D |
Form
of Assignment, Assumption and Recognition
Agreement
|
E |
Form
of Assignment and Conveyance
|
F |
Request
for Release of Documents and
Receipt
|
Addendum I |
Regulation
AB Compliance Addendum
|
This
is a
Seller’s Purchase, Warranties and Servicing Agreement, dated as of March 1, 2006
and is executed by and between Nomura Credit & Capital, Inc., as purchaser
(the “Purchaser”), and Wachovia Mortgage Corporation, as seller and servicer (in
such capacity, the “Seller”).
WITNESSETH:
WHEREAS,
the Purchaser has heretofore agreed to purchase from the Seller and the
Seller
has heretofore agreed to sell to the Purchaser certain Mortgage Loans,
servicing
rights retained, from time to time, pursuant to the terms of a letter agreement
by and between the Seller and the Purchaser (the “Purchase
Price and Terms Letter”);
WHEREAS,
each of the Mortgage Loans is secured by a mortgage, deed of trust or other
security instrument creating a first or second lien on a residential dwelling
located in the jurisdiction indicated on the related Mortgage Loan Schedule,
which is annexed to the related Assignment and Conveyance. The Mortgage
Loans as
described herein shall be delivered in groups of whole loans (each, a
“Mortgage
Loan Package”)
on
various dates as provided herein (each, a “Closing
Date”);
and
WHEREAS,
the Purchaser and the Seller wish to prescribe the representations and
warranties of the Seller with respect to itself, the Mortgage Loans and
the
management, servicing and control of the Mortgage Loans by the
Seller.
NOW,
THEREFORE, in consideration of the mutual agreements hereinafter set forth,
and
for other good and valuable consideration, the receipt and adequacy of
which is
hereby acknowledged, the Purchaser and the Seller agree as follows:
ARTICLE
II
DEFINITIONS
SECTION
2.01 Defined
Terms.
Whenever
used in this Agreement, the following words and phrases, unless the context
otherwise requires, shall have the following meaning specified in this
Article:
Accepted
Servicing Practices:
With
respect to any Mortgage Loan, those mortgage servicing practices (including
collection procedures) of prudent mortgage banking institutions which service
mortgage loans of the same type as such Mortgage Loan in the jurisdiction
where
the related Mortgaged Property is located, and which are in accordance
with
Xxxxxx Xxx servicing practices and procedures, for MBS pool mortgages,
as
defined in the Xxxxxx Mae Guides, including future updates.
Adjustable
Rate Mortgage Loan:
A
Mortgage Loan as to which the related Mortgage Note provides that the Mortgage
Interest Rate may be adjusted periodically.
Adjustment
Date:
With
respect to each Adjustable Rate Mortgage Loan, the date set forth in the
related
Mortgage Note on which the Mortgage Interest Rate on the Mortgage Loan
is
adjusted in accordance with the terms of the Mortgage Note.
Agency
Transfer:
The
sale or transfer by the Purchaser of some or all of the Mortgage Loans
to Xxxxxx
Xxx or Xxxxxxx Mac.
Agreement:
This
Seller’s Purchase, Warranties and Servicing Agreement including all exhibits
hereto, amendments hereof and supplements hereto.
Appraised
Value:
With
respect to any Mortgaged Property, the lesser of (i) the value thereof
as
determined by an appraisal made for the originator of the Mortgage Loan
at the
time of origination of the Mortgage Loan by an appraiser who met the
underwriting requirements of the originator, and (ii) the purchase price
paid
for the related Mortgaged Property by the Mortgagor with the proceeds of
the
Mortgage Loan, provided,
however,
in the
case of a Refinanced Mortgage Loan, such value of the Mortgaged Property
is
based solely upon the value determined by an appraisal made for the originator
of such Refinanced Mortgage Loan at the time of origination of such Refinanced
Mortgage Loan by an appraiser who met the underwriting requirements of
the
originator.
Assignment
and Conveyance:
As
defined in Section 2.03.
Assignment
of Mortgage:
An
assignment of the Mortgage, notice of transfer or equivalent instrument
in
recordable form, sufficient under the laws of the jurisdiction wherein
the
related Mortgaged Property is located to reflect the transfer of the
Mortgage.
BIF:
The
Bank Insurance Fund, or any successor thereto.
Business
Day:
Any day
other than (i) a Saturday or a Sunday, or (ii) a legal holiday in the States
of
New York or North Carolina, or (iii) a day on which banks in the States
of New
York or North Carolina are authorized or obligated by law or executive
order to
be closed.
Cash-Out
Refinancing:
A
Refinanced Mortgage Loan the proceeds of which were in excess of the principal
balance of any existing first mortgage loan on the related Mortgaged Property
and related closing costs, and were used to pay any such existing first
mortgage, related closing costs and subordinate mortgage loans on the related
Mortgaged Property.
Closing
Date:
The
date or dates set forth in the related Purchase Price and Terms Letter
on which
the Purchaser from time to time shall purchase and the Seller from time
to time
shall sell to the Purchaser, the Mortgage Loans listed on the related Mortgage
Loan Schedule with respect to the related Mortgage Loan Package.
Code:
The
Internal Revenue Code of 1986, as the same may be amended from time to
time (or
any successor statute thereto).
Compensating
Interest:
For any
Remittance Date, the lesser of (i) the aggregate Servicing Fee payable
to the
Seller for such Remittance Date and (ii) the aggregate Prepayment Interest
Shortfall for such Remittance Date.
Condemnation
Proceeds:
All
awards, compensation and settlements in respect of a Mortgaged Property,
whether
permanent or temporary, partial or entire, by exercise of the power of
eminent
domain or condemnation, to the extent not required to be released to a
Mortgagor
in accordance with the terms of the related Mortgage Loan
Documents.
Convertible
Mortgage Loan:
Any
Adjustable Rate Mortgage Loan purchased pursuant to this Agreement as to
which
the related Mortgage Note permits the Mortgagor to convert the Mortgage
Interest
Rate on such Mortgage Loan to a fixed Mortgage Interest Rate.
Co-op
Lease:
With
respect to a Co-op Loan, the lease with respect to a dwelling unit occupied
by
the Mortgagor and relating to the stock allocated to the related dwelling
unit.
Co-op
Loan:
A
Mortgage Loan secured by the pledge of stock allocated to a dwelling unit
in a
residential cooperative housing corporation and a collateral assignment
of the
related Co-op Lease.
Co-op
Stock:
With
respect to a Co-op Loan, the single outstanding class of stock, partnership
interest or other ownership instrument in the related residential cooperative
housing corporation.
Credit
Score:
The
credit score for each Mortgage Loan shall be the minimum of two credit
bureau
scores obtained at origination or such other time by the Seller. If two
credit
bureau scores are obtained, the Credit Score will be the lower score. If
three
credit bureau scores are obtained, the Credit Score will be the middle
of the
three. When there is more than one applicant, the lowest of the applicants’
Credit Scores will be used. There is only one (1) score for any loan regardless
of the number of borrowers and/or applicants.
Custodial
Account:
Each
separate demand account or accounts created and maintained pursuant to
Section
4.04 which shall be entitled “Wachovia Mortgage Corporation, in trust for the
Purchaser, owner of various whole loan series” and shall be established as an
Eligible Account, in the name of the Person that is the “Purchaser” with respect
to the related Mortgage Loans.
Cut-off
Date:
With
respect to each Mortgage Loan Package, the first Business Day of the month
of
the related Closing Date, or as otherwise set forth in the related Purchase
Price and Terms Letter.
Determination
Date:
With
respect to each Remittance Date, the 15th day (or if such 15th day is not
a
Business Day, the Business Day immediately preceding such 15th day) of
the month
in which such Remittance Date occurs.
Due
Date:
With
respect to any Mortgage Loan, the day of the month on which the Monthly
Payment
is due on such Mortgage Loan, exclusive of any days of grace.
Due
Period:
With
respect to each Remittance Date, the period commencing on the second day
of the
month preceding the month of such Remittance Date and ending on the first
day of
the month of the Remittance Date.
Eligible
Account:
An
account established and maintained: (a) within FDIC insured accounts (or
other
accounts with comparable insurance coverage acceptable to the Rating Agencies)
created, maintained and monitored by the Seller so that all funds deposited
therein are fully insured, (b) with the corporate trust department of a
financial institution assigned a long-term debt rating of not less than
“Baa3,”
and a short term debt rating of “P3,” from Xxxxx’x Investors Services, Inc. and,
if ownership of the Mortgage Loans is evidenced by mortgaged backed securities,
the equivalent ratings of the rating agencies, and held such that the rights
of
the Purchaser and the owner of the Mortgage Loans shall be fully protected
against the claims of any creditors of the Seller and of any creditors
or
depositors of the institution in which such account is maintained or (c)
in a
separate non-trust account without FDIC or other insurance in an Eligible
Institution. In the event that a Custodial Account is established pursuant
to
clause (b) or (c) of the preceding sentence, the Seller shall provide the
Purchaser with written notice on the Business Day following the date on
which
the applicable institution fails to meet the applicable ratings
requirements.
Eligible
Institution:
An
institution having (i) the highest short-term debt rating, and one of the
two
highest long-term debt ratings of the Rating Agency; or (ii) with respect
to any
Custodial Account, an unsecured long-term debt rating of at least one of
the two
highest unsecured long-term debt ratings of the Rating Agencies.
Eligible
Investments:
Any one
or more of the following obligations or securities:
(a) direct
obligations of, and obligations fully guaranteed by the United States of
America
or any agency or instrumentality of the United States of America the obligations
of which are backed by the full faith and credit of the United States of
America;
(b) (i)
demand or time deposits, federal funds or bankers’ acceptances issued by any
depository institution or trust company incorporated under the laws of
the
United States of America or any state thereof and subject to supervision
and
examination by federal and/or state banking authorities, provided that
the
commercial paper and/or the short-term deposit rating and/or the long-term
unsecured debt obligations or deposits of such depository institution or
trust
company at the time of such investment or contractual commitment providing
for
such investment are rated in one of the two highest rating categories by
each
Rating Agency and (ii) any other demand or time deposit or certificate
of
deposit that is fully insured by the FDIC;
(c) repurchase
obligations with a term not to exceed thirty (30) days and with respect
to (i)
any security described in clause (a) above and entered into with a depository
institution or trust company (acting as principal) described in clause
(b)(ii)
above;
(d) securities
bearing interest or sold at a discount issued by any corporation incorporated
under the laws of the United States of America or any state thereof that
are
rated in one of the two highest rating categories by each Rating Agency
at the
time of such investment or contractual commitment providing for such investment;
provided,
however,
that
securities issued by any particular corporation will not be Eligible Investments
to the extent that investments therein will cause the then outstanding
principal
amount of securities issued by such corporation and held as Eligible Investments
to exceed 10% of the aggregate outstanding principal balances of all of
the
Mortgage Loans and Eligible Investments;
(e) commercial
paper (including both non-interest-bearing discount obligations and
interest-bearing obligations payable on demand or on a specified date not
more
than one year after the date of issuance thereof) which are rated in one
of the
two highest rating categories by each Rating Agency at the time of such
investment;
(f) any
other
demand, money market or time deposit, obligation, security or investment
as may
be acceptable to each Rating Agency as evidenced in writing by each Rating
Agency; and
(g) any
money
market funds the collateral of which consists of obligations fully guaranteed
by
the United States of America or any agency or instrumentality of the United
States of America the obligations of which are backed by the full faith
and
credit of the United States of America (which may include repurchase obligations
secured by collateral described in clause (a)) and other securities and
which
money market funds are rated in one of the two highest rating categories
by each
Rating Agency.
provided,
however,
that no
instrument or security shall be an Eligible Investment if such instrument
or
security evidences a right to receive only interest payments with respect
to the
obligations underlying such instrument or if such security provides for
payment
of both principal and interest with a yield to maturity in excess of 120%
of the
yield to maturity at par or if such investment or security is purchased
at a
price greater than par.
Equity:
With
respect to any second lien Mortgage Loan, the Appraised Value, less the
unpaid
principal balance of the related First Lien.
Equity
Loan-to-Value:
With
respect to any second lien Mortgage Loan, the original principal balance
of such
Mortgage Loan, divided by the Equity.
Escrow
Account:
Each
separate trust account or accounts created and maintained pursuant to Section
4.06 which shall be entitled “Wachovia Mortgage Corporation, in trust for the
Purchaser, owner of various whole loan series and various Mortgagors” and shall
be established as an Eligible Account, in the name of the Person that is
the
“Purchaser” with respect to the related Mortgage Loans.
Escrow
Payments:
With
respect to any Mortgage Loan, the amounts constituting ground rents, taxes,
assessments, water rates, sewer rents, municipal charges, mortgage insurance
premiums, fire and hazard insurance premiums, condominium charges, and
any other
payments required to be escrowed by the Mortgagor with the mortgagee pursuant
to
the Mortgage, applicable law or any other related document.
Event
of Default:
Any one
of the conditions or circumstances enumerated in Section 8.01.
Xxxxxx
Mae:
The
entity formerly known as the Federal National Mortgage Association, or
any
successor thereto.
Xxxxxx
Xxx Guides:
The
Xxxxxx Xxx Xxxxxxx’ Guide and the Xxxxxx Xxx Servicers’ Guide and all amendments
or additions thereto, including, but not limited to, future updates
thereof.
FDIC:
The
Federal Deposit Insurance Corporation, or any successor thereto.
Fidelity
Bond:
A
fidelity bond to be maintained by the Seller pursuant to Section
4.12.
FIRREA:
The
Financial Institutions Reform, Recovery, and Enforcement Act of 1989, as
amended
and in effect from time to time.
First
Lien:
With
respect to any second lien Mortgage Loan, the mortgage loan relating to
the
corresponding Mortgaged Property having a first priority lien.
First
Remittance Date:
The
eighteenth (18th) day of the month following each respective Closing Date,
or if
such day is not a Business Day, the first Business Day immediately
thereafter.
Fixed
Rate Mortgage Loan:
A
Mortgage Loan purchased pursuant to this Agreement which bears a fixed
Mortgage
Interest Rate during the life of the loan.
Xxxxxxx
Mac:
The
entity formerly known as the Federal Home Loan Mortgage Corporation, or
any
successor thereto.
Xxxxxxx
Mac Guides:
The
Xxxxxxx Xxx Xxxxxxx’ Guide and the Xxxxxxx Mac Servicers’ Guide and all
amendments or additions thereto, including, but not limited to, any future
updates thereof.
GAAP:
Generally accepted accounting principles, consistently applied.
Gross
Margin:
With
respect to any Adjustable Rate Mortgage Loan, the fixed percentage amount
set
forth in the related Mortgage Note and the related Mortgage Loan Schedule
that
is added to the Index on each Adjustment Date in accordance with the terms
of
the related Mortgage Note to determine the new Mortgage Interest Rate for
such
Mortgage Loan.
HUD:
The
United States Department of Housing and Urban Development or any successor
thereto.
Index:
With
respect to any Adjustable Rate Mortgage Loan, the index identified on the
Mortgage Loan Schedule and set forth in the related Mortgage Note for the
purpose of calculating the Mortgage Interest Rate thereon.
Insurance
Proceeds:
With
respect to each Mortgage Loan, proceeds of insurance policies insuring
the
Mortgage Loan or the related Mortgaged Property.
Interest
Only Mortgage Loan:
A
Mortgage Loan that only requires payments of interest for a period of time
specified in the related Mortgage Note.
Liquidation
Proceeds:
Amounts
received in connection with the partial or complete liquidation of a defaulted
Mortgage Loan, whether through the sale or assignment of such Mortgage
Loan,
trustee’s sale, foreclosure sale or otherwise, or in connection with the sale of
the Mortgaged Property if the Mortgaged Property is acquired in satisfaction
of
the Mortgage.
Loan-to-Value
Ratio
or
LTV:
With
respect to any Mortgage Loan, the ratio of the original outstanding principal
amount of the Mortgage Loan and, with respect to any second lien Mortgage
Loan,
the outstanding principal amount of any related First Lien as of the date
of
origination of such mortgage loan, to the Appraised Value of the related
Mortgaged Property.
Maximum
Mortgage Interest Rate:
With
respect to each Adjustable Rate Mortgage Loan, a rate that is set forth
on the
related Mortgage Loan Schedule and in the related Mortgage Note and is
the
maximum interest rate to which the Mortgage Interest Rate on such Mortgage
Loan
may be increased on any Adjustment Date.
MERS:
Mortgage Electronic Registration Systems, Inc., a corporation organized
and
existing under the laws of the State of Delaware, or any successor
thereto.
MERS
Mortgage Loan:
Any
Mortgage Loan registered with MERS on the MERS System.
MERS
System:
The
system of recording transfers of mortgages electronically maintained by
MERS.
MIN:
The
Mortgage Identification Number for any MERS Mortgage Loan.
Minimum
Mortgage Interest Rate:
With
respect to each Adjustable Rate Mortgage Loan, a rate that is set forth
on the
related Mortgage Loan Schedule and in the related Mortgage Note and is
the
minimum interest rate to which the Mortgage Interest Rate on such Mortgage
Loan
may be decreased on any Adjustment Date.
MOM
Loan:
Any
Mortgage Loan as to which MERS is acting as mortgagee, solely as nominee
for the
originator of such Mortgage Loan and its successors and assigns.
Monthly
Advance:
The
payment required to be made by the Seller with respect to any Remittance
Date
pursuant to Section 5.03.
Monthly
Payment:
The
scheduled monthly payment on a Mortgage Loan due on any Due Date allocable
to
principal and/or interest on such Mortgage Loan pursuant to the terms of
the
related Mortgage Note.
Mortgage:
With
respect to any Mortgage Loan that is not a Co-op Loan, the mortgage, deed
of
trust or other instrument securing a Mortgage Note which creates a first
or
second lien on an unsubordinated estate in fee simple in real property
securing
the Mortgage Note; except that with respect to real property located in
jurisdictions in which the use of leasehold estates for residential properties
is a widely-accepted practice, the mortgage, deed of trust or other instrument
securing the Mortgage Note may secure and create a first or second lien
upon a
leasehold estate of the Mortgagor. With respect to a Co-op Loan, the related
Security Agreement.
Mortgage
File:
With
respect to each Mortgage Loan, the documents pertaining thereto specified
in
Exhibit
A-1
and any
additional documents required to be added to the Mortgage File pursuant
to this
Agreement.
Mortgage
Interest Rate:
As to
each Mortgage Loan, the annual rate at which interest accrues on such Mortgage
Loan in accordance with the provisions of the related Mortgage
Note.
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
related Mortgage Loan Schedule, which Mortgage Loan includes without limitation
the Mortgage File, the Monthly Payments, Principal Prepayments, Liquidation
Proceeds, Condemnation Proceeds, Insurance Proceeds, REO Disposition Proceeds,
any escrow accounts related to the Mortgage Loan, and all other rights,
benefits, proceeds and obligations arising from or in connection with such
Mortgage Loan, excluding replaced or repurchased mortgage loans.
Mortgage
Loan Documents:
The
documents contained in a Mortgage File.
Mortgage
Loan Package:
As
defined in the Recitals to this Agreement.
Mortgage
Loan Remittance Rate:
With
respect to each Mortgage Loan, the Mortgage Interest Rate less the related
Servicing Fee Rate.
Mortgage
Loan Schedule:
The
schedule of Mortgage Loans annexed to the related Assignment and Conveyance,
each such schedule setting forth the following information with respect
to each
Mortgage Loan in the related Mortgage Loan Package:
(1) the
Seller’s Mortgage Loan identifying number;
(2) the
Mortgagor’s name;
(3) the
street address of the Mortgaged Property including the state and zip
code;
(4) a
code
indicating whether the Mortgaged Property is owner-occupied;
(5) the
type
of residential property constituting the Mortgaged Property;
(6) 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;
(7) the
Loan-to-Value Ratio at origination and as of the related Cut-off
Date;
(8) with
respect to any second lien Mortgage Loan, the Equity Loan-to-Value Ratio
at
origination and as of the related Cut-off Date;
(9) the
Mortgage Interest Rate at origination and as of the related Cut-off
Date;
(10) the
Mortgage Loan origination date;
(11) the
paid
through date;
(12) the
stated maturity date of the Mortgage Loan and of the First Lien, if
applicable;
(13) the
amount of the Monthly Payment as of the related Cut-off Date;
(14) the
original principal amount of the Mortgage Loan and the principal balance
of the
related First Lien, if applicable, as of the date of origination;
(15) the
Scheduled Principal Balance of the Mortgage Loan and the principal balance
of
the related First Lien, if applicable, as of the related Cut-off
Date;
(16) a
code
indicating the purpose of the Mortgage Loan (i.e., purchase, rate and term
refinance, equity take-out refinance);
(17) a
code
indicating the documentation style (i.e. full, alternative or
reduced);
(18) the
number of times during the twelve (12) month period preceding the related
Closing Date that any Monthly Payment has been received thirty (30) or
more days
after its Due Date;
(19) the
date
on which the first Monthly Payment is due and the applicable next Due
Date;
(20) a
code
indicating whether or not the Mortgage Loan is insured as to payment defaults
by
a Primary Mortgage Insurance Policy; and, in the case of any Mortgage Loan
which
is insured as to payment defaults by a Primary Mortgage Insurance Policy,
the
name of the provider of such Primary Mortgage Insurance Policy;
(21) a
code
indicating whether or not the Mortgage Loan is the subject of a prepayment
penalty, and if so, the terms of such prepayment penalty;
(22) the
Primary Mortgage Insurance Policy certificate number, if
applicable;
(23) the
Primary Mortgage Insurance Policy coverage percentage, if
applicable;
(24) a
code
indicating the Credit Score of the Mortgagor at the time of origination
of the
Mortgage Loan;
(25) a
code
indicating the specific loan/underwriting program of each Mortgage Loan
as
assigned by the Seller pursuant to the Underwriting Standards;
(26) the
loan
type (i.e. fixed, adjustable; 2/28, 3/27, 5/25, etc.);
(27) with
respect to each Adjustable Rate Mortgage Loan, the first Adjustment Date
and the
Adjustment Date frequency;
(28) with
respect to each Adjustable Rate Mortgage Loan, the Gross Margin;
(29) with
respect to each Adjustable Rate Mortgage Loan, the Maximum Mortgage Interest
Rate under the terms of the Mortgage Note;
(30) with
respect to each Adjustable Rate Mortgage Loan, the Minimum Mortgage Interest
Rate under the terms of the Mortgage Note;
(31) with
respect to each Adjustable Rate Mortgage Loan, the Periodic Rate
Cap;
(32) with
respect to each Adjustable Rate Mortgage Loan, the first Adjustment Date
immediately following the related Cut-off Date;
(33) with
respect to each Adjustable Rate Mortgage Loan, the Index;
(34) a
code
indicating whether the Mortgage Loan is a first or second lien Mortgage
Loan;
(35) a
code
indicating whether the Mortgage Loan is a MERS Mortgage Loan;
(36) the
MERS
identification number;
(37) a
code
indicating whether the Mortgage Loan is an Interest Only Mortgage Loan
and the
term of the interest-only period;
(38) the
Appraised Value of the Mortgaged Property;
(39) the
sale
price of the Mortgaged Property, if applicable;
(40) a
code
indicating the form of appraisal (i.e. form 1004, 2055, etc.);
(41) the
rate
change cap at the first interest rate adjustment date; and
(42) the
maximum rate change cap.
With
respect to the Mortgage Loans in the aggregate in each Mortgage Loan Package,
the Mortgage Loan Schedule shall set forth the following information, as
of the
related Cut-off Date unless otherwise specified:
(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;
(4) the
weighted average original months to maturity of the Mortgage Loans and
the
weighted average remaining months to maturity of the Mortgage
Loans.
Mortgage
Note:
The
note or other evidence of the indebtedness of a Mortgagor secured by a
Mortgage.
Mortgaged
Property:
With
respect to any Mortgage Loan, the underlying real property securing repayment
of
the related Mortgage Note, consisting of a fee simple parcel of real estate
or a
leasehold estate, the term of which is equal to or longer than the term
of such
Mortgage Note.
Mortgagor:
The
obligor on a Mortgage Note.
Mortgagor
Personal Information:
Any
information, including, but not limited to, all personal information about
a
Mortgagor that is disclosed to the Seller or the Purchaser by or on behalf
of
the Mortgagor.
OCC:
Office
of the Comptroller of the Currency, its successors and assigns.
Officers’
Certificate:
A
certificate signed by the Chairman of the Board, the Vice Chairman of the
Board,
the President, a Senior Vice President or a Vice President and by the Treasurer
or the Secretary or one of the Assistant Treasurers or Assistant Secretaries
of
the Seller, and delivered to the Purchaser as required by this
Agreement.
Opinion
of Counsel:
A
written opinion of counsel, who may be an employee of the party on behalf
of
whom the opinion is being given, reasonably acceptable to the
Purchaser.
OTS:
Office
of Thrift Supervision or any successor thereto.
Pass-Through
Transfer:
As
defined in Section 11.01(a)(ii).
Periodic
Rate Cap:
With
respect to each Adjustable Rate Mortgage Loan and any Adjustment Date therefor,
a number of percentage points per annum that is set forth in the related
Mortgage Loan Schedule and in the related Mortgage Note, which is the maximum
amount by which the Mortgage Interest Rate for such Mortgage Loan may increase
(without regard to the Maximum Mortgage Interest Rate) or decrease (without
regard to the Minimum Mortgage Interest Rate) on such Adjustment Date from
the
Mortgage Interest Rate in effect immediately prior to such Adjustment Date,
which may be a different amount with respect to the first Adjustment
Date.
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.
Prepayment
Interest Shortfall:
As to
any Remittance Date and Principal Prepayment in full, the difference between
(i)
one full month’s interest at the applicable Mortgage Interest Rate (after giving
effect to any applicable relief act reduction, debt service reduction and
deficient valuation), as reduced by the Servicing Fee Rate, on the outstanding
principal balance of the related Mortgage Loan immediately prior to such
Principal Prepayment and (ii) the amount of interest actually received
with
respect to such Mortgage Loan in connection with such Principal
Prepayment.
Primary
Mortgage Insurance Policy:
Each
policy of primary mortgage insurance represented to be in effect pursuant
to
Section 3.02(bb), or any replacement policy therefor obtained by the Seller
pursuant to Section 4.08.
Prime
Rate:
The
prime rate announced to be in effect from time to time as published as
the
average rate in The
Wall Street Journal
(Northeast Edition).
Principal
Prepayment:
Any
full or partial payment or other recovery of principal on a Mortgage Loan
which
is received in advance of its scheduled Due Date, including any prepayment
penalty or premium thereon and which is not accompanied by an amount of
interest
representing scheduled interest due on any date or dates in any month or
months
subsequent to the month of prepayment.
Purchase
Price:
As
defined in Section 2.02.
Purchase
Price and Terms Letter:
As
defined in the Recitals to this Agreement which may also be a form of trade
execution notice.
Purchaser:
Nomura
Credit & Capital, Inc., its successors in interest and assigns.
Qualified
Appraiser:
With
respect to each Mortgage Loan, an appraiser, duly appointed by the Seller,
who
had no interest, direct or indirect in the Mortgaged Property or in any
loan
made on the security thereof, and whose compensation is not affected by
the
approval or disapproval of the Mortgage Loan, and such appraiser and the
appraisal made by such appraiser both satisfy the requirements of Xxxxxx
Mae and
Title XI of FIRREA and the regulations promulgated thereunder, all as in
effect
on the date the Mortgage Loan was originated.
Qualified
Insurer:
An
insurance company duly qualified as such under the laws of the states in
which
the Mortgaged Properties are located, duly authorized and licensed in such
states to transact the applicable insurance business and to write the insurance
provided by the insurance policy issued by it, approved as an insurer by
Xxxxxx
Xxx or Xxxxxxx Mac.
Rating
Agencies:
Standard & Poor’s Ratings Services, a division of The XxXxxx- Xxxx
Companies, Inc., Xxxxx’x Investors Service, Inc. or, in the event that some or
all ownership of the Mortgage Loans is evidenced by mortgage-backed securities,
the nationally recognized rating agencies issuing ratings with respect
to such
securities, if any.
Refinanced
Mortgage Loan:
A
Mortgage Loan which was made to a Mortgagor who owned the Mortgaged Property
prior to the origination of such Mortgage Loan and the proceeds of which
were
used in whole or part to satisfy an existing mortgage.
Regulation
AB Compliance Addendum:
Addendum
I
attached
hereto and incorporated herein by reference thereto.
REMIC:
A “real
estate mortgage investment conduit” within the meaning of Section 860D of the
Code.
Remittance
Date:
The
18th day of each month, beginning with the First Remittance Date, or if
such day
is not a Business Day, the first Business Day thereafter.
REO
Disposition:
The
final sale by the Seller of any REO Property.
REO
Disposition Proceeds:
Amounts
received by the Seller in connection with an REO Disposition.
REO
Property:
A
Mortgaged Property acquired by or on behalf of the Purchaser in full or
partial
satisfaction of the related Mortgage as described in Section 4.13.
Repurchase
Price:
With
respect to any Mortgage Loan, a price equal to (i) the outstanding principal
balance of the Mortgage Loan, plus
(ii)
interest on such outstanding principal balance at the related Mortgage
Loan
Remittance Rate from the date through which interest was last distributed
to the
Purchaser (from payments from the related Mortgagor or from Monthly Advances)
through the day prior to the date of repurchase, less
(iii)
amounts received or advanced in respect of such repurchased Mortgage Loan
which
are being held in the Custodial Account for distribution in connection
with such
Mortgage Loan, plus
(iv) all
costs and expenses incurred in connection with violation of the Mortgage
Loan of
any predatory or abusive lending law.
SAIF:
The
Savings Association Insurance Fund, or any successor thereto.
Security
Agreement:
With
respect to a Co-op Loan, the agreement or mortgage creating a security
interest
in favor of the originator of the Co-op Loan in the related Co-op
Stock.
Scheduled
Principal Balance:
As to
each Mortgage Loan and any date of determination, (i) the principal balance
of
such Mortgage Loan as of the related Cut-off Date after giving effect to
payments of principal due on or before such date, whether or not received,
minus
(ii) all amounts previously distributed to the Purchaser with respect to
the
Mortgage Loan representing payments or recoveries of principal (or advances
in
lieu thereof).
Servicing
Advances:
All
customary, reasonable and necessary “out of pocket” costs and expenses
(including reasonable attorneys’ fees and disbursements) incurred in the
performance by the Seller of its servicing obligations, including, but
not
limited to, the cost of (a) the preservation, restoration and protection
of a
Mortgaged Property, (b) any enforcement, administrative or judicial proceedings,
or any legal work or advice specifically related to servicing the Mortgage
Loans, including but not limited to, foreclosures, bankruptcies, condemnations,
drug seizures, elections, foreclosures by subordinate or superior lienholders,
and other legal actions incidental to the servicing of the Mortgage Loans
(provided that such expenses are reasonable and that the Seller specifies
the
Mortgage Loan(s) to which such expenses relate, and provided further that
any
such enforcement, administrative or judicial proceeding does not arise
out of a
breach of any representation, warranty or covenant of the Seller hereunder),
(c)
the management and liquidation of any REO Property, (d) taxes, assessments,
water rates, sewer rates and other charges which are or may become a lien
upon
the Mortgaged Property, and Primary Mortgage Insurance Policy premiums
and fire
and hazard insurance coverage, (e) any expenses reasonably sustained by
the
Seller with respect to the liquidation of the Mortgaged Property in accordance
with the terms of this Agreement and (f) compliance with the obligations
under
Section 4.08.
Servicing
Fee:
As to
each Mortgage Loan Package, the amount of the fee the Purchaser shall pay
to the
Seller for servicing the Mortgage Loans in accordance with the terms of
this
Agreement, which shall, with respect to each Mortgage Loan, for a period
of one
full month, be equal to one-twelfth of the product of (i) the Servicing
Fee Rate
and (ii) the Scheduled Principal Balance of such Mortgage Loan as of the
first
day of the month for which such fee is being calculated, which fee shall
be
pro-rated for any partial month.
Servicing
Fee Rate:
The per
annum rate at which the Servicing Fee accrues, which rate with respect
to each
Mortgage Loan shall be as set forth in the related Purchase Price and Terms
Letter.
Servicing
File:
With
respect to each Mortgage Loan, the documents pertaining thereto specified
in
Exhibit
A-2
and
copies of all documents for such Mortgage Loan specified in Exhibit
A-1.
Servicing
Officer:
Any
officer of the Seller involved in, or responsible for, the administration
and
servicing of the Mortgage Loans whose name appears on a list of servicing
officers furnished by the Seller to the Purchaser upon request, as such
list may
from time to time be amended.
Underwriting
Standards:
As to
each Mortgage Loan, the Seller’s underwriting guidelines in effect as of the
date of origination of such Mortgage Loan.
Whole
Loan Transfer:
As
defined in Section 11.01(a)(i).
ARTICLE
III
SERVICING
OF MORTGAGE LOANS; RECORD TITLE AND POSSESSION OF MORTGAGE FILES; BOOKS
AND
RECORDS; CUSTODIAL AGREEMENT; DELIVERY OF MORTGAGE LOAN DOCUMENTS
SECTION
3.01 Agreement
to Purchase.
The
Seller agrees to sell and the Purchaser agrees to purchase on each Closing
Date,
pursuant to this Agreement and the related Purchase Price and Terms Letter,
the
Mortgage Loans being sold by the Seller and listed on the related Mortgage
Loan
Schedule, servicing rights retained, having an aggregate Scheduled Principal
Balance in an amount as set forth in the related Purchase Price and Terms
Letter, or in such other amount as agreed by the Purchaser and the Seller
as
evidenced by the actual aggregate principal balance of the Mortgage Loans
accepted by the Purchaser on such Closing Date. The Seller shall deliver
in an
electronic format the Mortgage Loan Schedule for the Mortgage Loans to
be
purchased on such Closing Date to the Purchaser at least two (2) Business
Days
prior to such Closing Date.
SECTION
3.02 Purchase
Price.
The
Purchase Price for the Mortgage Loans in a Mortgage Loan Package shall
be equal
to the sum of (a) the percentage of par as stated in the related Purchase
Price
and Terms Letter (subject to adjustment as provided therein), multiplied
by the
aggregate Scheduled Principal Balance of Mortgage Loans as of the related
Cut-off Date listed on the related Mortgage Loan Schedule plus
(b)
accrued interest on the aggregate Scheduled Principal Balance of the related
Mortgage Loans at the weighted average Mortgage Loan Remittance Rate of
such
Mortgage Loans from the related Cut-off Date to but not including such
Closing
Date (the “Purchase
Price”).
If so
provided in the related Purchase Price and Terms Letter, portions of each
Mortgage Loan Package shall be priced separately.
The
Purchase Price as set forth in the preceding paragraph for the Mortgage
Loans in
a Mortgage Loan Package shall be paid on the related Closing Date by wire
transfer of immediately available funds.
With
respect to each Mortgage Loan, the Purchaser shall be entitled to (1) the
principal portion of all Monthly Payments due after the related Cut-off
Date,
(2) all other recoveries of principal collected on or after the related
Cut-off
Date (provided, however, that the principal portion of all Monthly Payments
due
on or before the related Cut-off Date and collected by the Seller or any
successor servicer after the related Cut-off Date shall belong to the Seller),
and (3) all payments of interest on the Mortgage Loans at the related Mortgage
Loan Remittance Rate (minus that portion of any such payment which is allocable
to the period prior to the related Cut-off Date). The Scheduled Principal
Balance of each Mortgage Loan as of the related Cut-off Date is determined
after
application of payments of principal due on or before the related Cut-off
Date
whether or not collected, together with any unscheduled Principal Prepayments
collected prior to the related Cut-off Date; provided,
however,
that
Monthly Payments for a Due Date beyond the related Cut-off Date shall not
be
applied to the principal balance as of the related Cut-off Date. Such Monthly
Payments shall be the property of the Purchaser. The Seller shall deposit
any
such Monthly Payments into the Custodial Account.
SECTION
3.03 Servicing
of Mortgage Loans.
On
each
Closing Date, the Mortgage Loans in the related Mortgage Loan Package will
be
sold by the Seller to the Purchaser on a servicing retained basis upon
the
execution and delivery of an Assignment and Conveyance in the form attached
hereto as Exhibit
E
(the
“Assignment
and Conveyance”).
Simultaneously
with the execution and delivery of the related Assignment and Conveyance,
for
each Mortgage Loan Package, the Seller hereby agrees to service the Mortgage
Loans listed on the Mortgage Loan Schedule in accordance with Accepted
Servicing
Practices and this Agreement. The rights of the Purchaser to receive payments
with respect to the related Mortgage Loans shall be as set forth in this
Agreement.
SECTION
3.04 Record
Title and Possession of Mortgage Files; Maintenance of Servicing
Files.
As
of
each Closing Date, the Seller will have sold, transferred, assigned, set
over
and conveyed to the Purchaser, without recourse, and the Seller hereby
acknowledges that the Purchaser will have, all the right, title and interest
of
the Seller in and to the Mortgage Loans. In accordance with Section 2.07,
the
Seller shall deliver at its own expense, the Mortgage Files for the related
Mortgage Loans to Purchaser or its designee. The possession of each Servicing
File by the Seller is for the sole purpose of servicing the related Mortgage
Loan. From each Closing Date, the ownership of each related Mortgage Loan,
including the Mortgage Note, the Mortgage, the contents of the related
Mortgage
File and all rights, benefits, proceeds and obligations arising therefrom
or in
connection therewith, has been vested in the Purchaser. All rights arising
out
of the Mortgage Loans including, but not limited to, all funds received
on or in
connection with the Mortgage Loans and all records or documents with respect
to
the Mortgage Loans prepared by or which come into the possession of the
Seller
shall be received and held by the Seller in trust for the benefit of the
Purchaser as the owner of the Mortgage Loans. Any portion of the Mortgage
Files
retained by the Seller shall be appropriately identified in the Seller’s
computer system to clearly reflect the ownership of the Mortgage Loans
by the
Purchaser.
In
addition, in connection with the assignment of any MERS Mortgage Loan,
the
Seller agrees that it will cause, at its own expense, the MERS® System to
indicate that such Mortgage Loans have been assigned by the Seller to the
Purchaser in accordance with this Agreement by including (or deleting,
in the
case of Mortgage Loans which are repurchased in accordance with this Agreement)
in such computer files the information required by the MERS® System to identify
the Purchaser of such Mortgage Loans. The Seller further agrees that it
will not
alter the information referenced in this paragraph with respect to any
Mortgage
Loan during the term of this Agreement unless and until such Mortgage Loan
is
repurchased in accordance with the terms of this Agreement.
SECTION
3.05 Books
and
Records.
The
sale
of each Mortgage Loan will be reflected on the Seller’s balance sheet and other
financial statements as a sale of assets by the Seller and will be reflected
on
the Purchaser’s balance sheet and other financial statements as a purchase by
the Purchaser. The Seller shall maintain, a complete set of books and records
for the Mortgage Loans sold by it which shall be appropriately identified
in the
Seller’s computer system to clearly reflect the ownership of the Mortgage Loans
by the Purchaser. In particular, the Seller shall maintain in its possession,
available for inspection by the Purchaser, or its designee and shall deliver
to
the Purchaser upon demand, evidence of compliance with all federal, state
and
local laws, rules and regulations, and requirements of Xxxxxx Mae or Xxxxxxx
Mac, as applicable, including but not limited to documentation as to the
method
used in determining the applicability of the provisions of the Flood Disaster
Protection Act of 1973, as amended, to the Mortgaged Property, documentation
evidencing insurance coverage and eligibility of any condominium project
for
approval by Seller and periodic inspection reports as required by Section
4.13.
To the extent that original documents are not required for purposes of
realization of Liquidation Proceeds or Insurance Proceeds, documents maintained
by the Seller may be in the form of microfilm or microfiche or such other
reliable means of recreating original documents, including but not limited
to,
optical imagery techniques so long as the Seller complies with the requirements
of the Xxxxxx Mae Guides.
SECTION
3.06 Transfer
of Mortgage Loans.
The
Seller shall keep at its office books and records in which, subject to
such
reasonable regulations as it may prescribe, the Seller shall note transfers
of
Mortgage Loans. No transfer of a Mortgage Loan may be made unless such
transfer
is in compliance with the terms of Section 11.12. For the purposes of this
Agreement, the Seller shall be under no obligation to deal with any person
with
respect to this Agreement or any Mortgage Loan unless a properly executed
Assignment, Assumption and Recognition Agreement in the form of Exhibit
D
with
respect to such Mortgage Loan has been delivered to the Seller; provided,
that,
unless otherwise provided in the related Purchase Price and Terms Letter,
in no
event shall there be more than three (3) “Purchasers” with respect to any
Mortgage Loan Package. Upon receipt of notice of the transfer, the Seller
shall
xxxx its books and records to reflect the ownership of the Mortgage Loans
by
such assignee, and, except as otherwise provided herein, the previous Purchaser
shall be released from its obligations hereunder with respect to the Mortgage
Loans sold or transferred.
SECTION
3.07 Delivery
of Mortgage Loan Documents.
The
Seller shall deliver and release to the Purchaser or its designee the Mortgage
Loan Documents no later than five (5) Business Days prior to the related
Closing
Date pursuant to a bailee letter agreement. If the Seller cannot deliver
the
original recorded Mortgage Loan Documents on the related Closing Date,
the
Seller shall use its best efforts to deliver within 180 days, and in no
event
later than 270 days, from the related Closing Date, such original recorded
documents to the Purchaser or its designee (unless the Seller is delayed
in
making such delivery by reason of the fact that such documents shall not
have
been returned by the appropriate recording office). If delivery is not
completed
within 270 days of the related Closing Date solely because such documents
shall
not have been returned by the appropriate recording office, the Seller
shall
notify the Purchaser of the same and indicate in such notice the approximate
date on which such documents shall be delivered. The Seller shall provide
the
Purchaser with updated reports as to the status of such documents as necessary
thereafter. The Seller shall use its best efforts to effect delivery of
all
delayed recorded documents within 360 days of the related Closing
Date.
Any
review by the Purchaser or its designee of the Mortgage Files shall in
no way
alter or reduce the Seller’s obligations hereunder.
The
Seller shall forward to the Purchaser, or its designee, original documents
evidencing an assumption, modification, consolidation or extension of any
Mortgage Loan entered into in accordance with Section 4.01 or 6.01 within
two
(2) weeks of their execution and shall also provide the original of any
document
submitted for recordation or a copy of such document certified by the
appropriate public recording office to be a true and complete copy of the
original within two (2) weeks of its return from the appropriate public
recording office.
SECTION
3.08 Quality
Control Procedures.
The
Seller shall have an internal quality control program that verifies, on
a
regular basis, the existence and accuracy of the legal documents, credit
documents, property appraisals, and underwriting decisions. The program
must be
capable of evaluating and monitoring the overall quality of its loan production
and servicing activities. The program is to ensure that the Mortgage Loans
are
originated and serviced in accordance with prudent mortgage banking practices
and accounting principles; guard against dishonest, fraudulent, or negligent
acts; and guard against errors and omissions by officers, employees, or
other
authorized persons.
SECTION
3.09 Closing.
The
closing for the purchase and sale of the Mortgage Loans shall take place
on the
related Closing Date. The closing shall be either: by telephone, confirmed
by
letter or wire as the parties shall agree, or conducted in person, at such
place
as the parties shall agree.
The
closing for the Mortgage Loans to be purchased on the related Closing Date
shall
be subject to each of the following conditions:
(a) at
least
two (2) Business Days prior to the related Closing Date, the Seller shall
deliver to the Purchaser a magnetic diskette, or transmit by modem or e-mail,
a
listing on a loan-level basis of the information contained in the Mortgage
Loan
Schedule;
(b) all
of
the representations and warranties of the Seller and the Purchaser under
this
Agreement shall be true and correct as of the related Closing Date or,
with
respect to representations and warranties made as of a date other than
the
related Closing Date, as of such date, and no event shall have occurred
which,
with notice or the passage of time, would constitute a default under this
Agreement;
(c) the
Purchaser shall have received, or the Purchaser’s attorneys shall have received
in escrow, all closing documents, in such forms as are agreed upon and
acceptable to the Purchaser, duly executed by all signatories other than
the
Purchaser as required pursuant to the terms hereof;
(d) the
Seller shall have received, or the Seller’s attorneys shall have received in
escrow, all closing documents, in such forms as are agreed upon and acceptable
to the Seller, duly executed by all signatories other than the Seller as
required pursuant to the terms hereof;
(e) the
Seller shall have delivered and released to the Purchaser (or its designee)
on
or prior to the related Closing Date all documents required to be delivered
and
released pursuant to the terms of this Agreement; and
(f) all
other
terms and conditions of this Agreement, the related Purchase Price and
Terms
Letter and the related Assignment and Conveyance shall have been materially
complied with.
Subject
to the foregoing conditions, the Purchaser shall pay to the Seller on the
related Closing Date the Purchase Price pursuant to Section 2.02 of this
Agreement, by wire transfer of immediately available funds to the account
designated by the Seller.
ARTICLE
IV
REPRESENTATIONS
AND WARRANTIES OF THE SELLER; REPURCHASE; REVIEW OF MORTGAGE LOANS
SECTION
4.01 Representations
and Warranties of the Seller.
The
Seller represents, warrants and covenants to the Purchaser that as of each
Closing Date or as of such date specifically provided herein:
(a) The
Seller is a corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation and has all licenses
necessary to carry out its business as now being conducted, and is licensed
and
qualified to transact business in and is in good standing under the laws
of each
state in which any Mortgaged Property is located or is otherwise exempt
under
applicable law from such licensing or qualification or is otherwise not
required
under applicable law to effect such licensing or qualification and no demand
for
such licensing or qualification has been made upon the Seller by any such
state,
and in any event the Seller is in compliance with the laws of any such
state to
the extent necessary to ensure the enforceability of each Mortgage Loan
and the
servicing of the Mortgage Loans in accordance with the terms of this
Agreement;
(b) The
Seller has the full power and authority and legal right to hold, transfer
and
convey each Mortgage Loan, to sell each Mortgage Loan and to execute, deliver
and perform, and to enter into and consummate all transactions contemplated
by
this Agreement, the related Purchase Price and Terms Letter and the related
Assignment and Conveyance and to conduct its business as presently conducted;
the Seller has duly authorized the execution, delivery and performance
of this
Agreement and any agreements contemplated hereby, has duly executed and
delivered this Agreement, the related Purchase Price and Terms Letter and
the
related Assignment and Conveyance, and any agreements contemplated hereby,
and
this Agreement, the related Purchase Price and Terms Letter, the related
Assignment and Conveyance and each Assignment of Mortgage to the Purchaser
and
any agreements contemplated hereby, constitute the legal, valid and binding
obligations of the Seller, enforceable against it in accordance with their
respective terms, except as such enforceability may be limited by bankruptcy,
insolvency, moratorium, reorganization and similar laws, and by equitable
principles affecting the enforceability of the rights of creditors; and
all
requisite corporate action has been taken by the Seller to make this Agreement,
the related Purchase Price and Terms Letter, the related Assignment and
Conveyance and all agreements contemplated hereby valid and binding upon
the
Seller in accordance with their respective terms;
(c) None
of
the execution and delivery of this Agreement, the related Purchase Price
and
Terms Letter, the related Assignment and Conveyance, the sale of the Mortgage
Loans to the Purchaser, the consummation of the transactions contemplated
hereby, or the fulfillment of or compliance with the terms and conditions
of
this Agreement, the related Purchase Price and Terms Letter or the related
Assignment and Conveyance will conflict with any of the terms, conditions
or
provisions of the Seller’s charter or by-laws or materially conflict with or
result in a material breach of any of the terms, conditions or provisions
of any
legal restriction or any material agreement or instrument to which the
Seller is
now a party or by which it is bound, or constitute a default or result
in an
acceleration under any of the foregoing, or result in the material violation
of
any law, rule, regulation, order, judgment or decree to which the Seller
or its
property is subject;
(d) There
is
no litigation, suit, proceeding or investigation pending or, to the Seller’s
knowledge, threatened, or any order or decree outstanding, which is reasonably
likely to have a material adverse effect on the sale of the Mortgage Loans,
the
execution, delivery, performance or enforceability of this Agreement, the
related Purchase Price and Terms Letter or the related Assignment and
Conveyance, or which is reasonably likely to have a material adverse effect
on
the financial condition of the Seller;
(e) No
consent, approval, authorization or order of any court or governmental
agency or
body is required for the execution, delivery and performance by the Seller
of or
compliance by the Seller with this Agreement, the related Purchase Price
and
Terms Letter and the related Assignment and Conveyance, except for consents,
approvals, authorizations and orders which have been obtained;
(f) The
consummation of the transactions contemplated by this Agreement, the related
Purchase Price and Terms Letter and the related Assignment and Conveyance
are in
the ordinary course of business of the Seller, and the transfer, assignment
and
conveyance of the Mortgage Notes and the Mortgages by the Seller pursuant
to
this Agreement, the related Purchase Price and Terms Letter and the related
Assignment and Conveyance are not subject to bulk transfer or any similar
statutory provisions in effect in any applicable jurisdiction;
(g) The
Seller has not used selection procedures that identified the Mortgage Loans
as
being less desirable or valuable than other comparable mortgage loans in
the
Seller’s portfolio at the Cut-off Date;
(h) The
Seller will treat the sale of the Mortgage Loans to the Purchaser as a
sale for
reporting and accounting purposes and, to the extent appropriate, for federal
income tax purposes;
(i) The
Seller is an approved seller/servicer of residential mortgage loans for
Xxxxxx
Mae or Xxxxxxx Mac and HUD, with such facilities, procedures and personnel
necessary for the sound servicing of such mortgage loans. The Seller is
duly
qualified, licensed, registered and otherwise authorized under all applicable
federal, state and local laws and regulations, meets the minimum capital
requirements, if applicable, set forth by the OCC, and is in good standing
to
sell mortgage loans to and service mortgage loans for Xxxxxx Mae or Xxxxxxx
Mac
and no event has occurred which would make the Seller unable to comply
with
eligibility requirements or which would require notification to either
Xxxxxx
Mae or Xxxxxxx Mac;
(j) The
Seller does not believe, nor does it have any cause or reason to believe,
that
it cannot perform each and every covenant contained in this Agreement and
the
related Purchase Price and Terms Letter. The Seller is solvent and the
sale of
the Mortgage Loans will not cause the Seller to become insolvent. The sale
of
the Mortgage Loans is not undertaken with the intent to hinder, delay or
defraud
any of the Seller’s creditors;
(k) No
statement, tape, diskette, form, report or other document prepared by,
or on
behalf of, the Seller pursuant to this Agreement, the related Purchase
Price and
Terms Letter or in connection with the transactions contemplated hereby,
contains or will contain any statement that is or will be inaccurate or
misleading in any material respect;
(l) The
Seller acknowledges and agrees that the Servicing Fee represents reasonable
compensation for performing such services and that the entire Servicing
Fee
shall be treated by the Seller, for accounting and tax purposes, as compensation
for the servicing and administration of the Mortgage Loans pursuant to
this
Agreement;
(m) The
Seller has delivered to the Purchaser financial statements as to its last
two
complete fiscal years for which financial statements are available. All
such
financial statements fairly present the pertinent results of operations
and
changes in financial position for each of such periods and the financial
position at the end of each such period of the Seller and its subsidiaries
and
have been prepared in accordance with GAAP consistently applied throughout
the
periods involved, except as set forth in the notes thereto. There has been
no
change in the business, operations, financial condition, properties or
assets of
the Seller since the date of the Seller’s financial statements that would have a
material adverse effect on its ability to perform its obligations under
this
Agreement, the related Purchase Price and Terms Letter or the related Assignment
and Conveyance;
(n) The
Seller has not dealt with any broker, investment banker, agent or other
person
that may be entitled to any commission or compensation in connection with
the
sale of the Mortgage Loans;
(o) The
Seller is a member of MERS in good standing, and will comply in all material
respects with the rules and procedures of MERS in connection with the servicing
of the MERS Mortgage Loans for as long as such Mortgage Loans are registered
with MERS;
(p) Immediately
prior to the payment of the Purchase Price for each Mortgage Loan, the
Seller
was the owner of record of the related Mortgage and the indebtedness evidenced
by the related Mortgage Note;
(q) The
Seller shall maintain a complete set of books and records for each Mortgage
Loan
which shall be clearly marked to reflect the ownership of each Mortgage
Loan by
the Purchaser;
(r) The
consideration received by the Seller upon the sale of the Mortgage Loans
constitutes fair consideration and reasonably equivalent value for such
Mortgage
Loans;
(s) Neither
this Agreement nor any written statement, report or other document prepared
and
furnished or to be prepared and furnished by the Seller pursuant to this
Agreement or in connection with the transactions contemplated hereby contains
any untrue statement of material fact or omits to state a material fact
necessary to make the statements contained herein or therein not misleading;
and
(t) The
Seller’s underwriting guidelines delivered to the Purchaser are true, correct
and complete.
SECTION
4.02 Representations
and Warranties as to Individual Mortgage Loans.
The
Seller hereby represents and warrants to the Purchaser, as to each Mortgage
Loan, as of the related Closing Date as follows:
(a) The
information set forth in the Mortgage Loan Schedule, including any diskette
or
other related data tapes delivered to the Purchaser, is complete, true
and
correct in all material respects as of the related Cut-off Date;
(b) With
respect to a first lien Mortgage Loan that is not a Co-op Loan, the Mortgage
creates a first lien or a first priority ownership interest in an estate
in fee
simple in real property securing the related Mortgage Note. With respect
to a
first lien Mortgage Loan that is a Co-op Loan, the Mortgage creates a first
lien
or a first priority ownership interest in the stock ownership and leasehold
rights associated with the cooperative unit securing the related Mortgage
Note;
(c) With
respect to a second lien Mortgage Loan that is not a Co-op Loan, the Mortgage
creates a second lien or a second priority ownership interest in an estate
in
fee simple in real property securing the related Mortgage Note. With respect
to
a second lien Mortgage Loan that is a Co-op Loan, the Mortgage creates
a second
lien or a second priority ownership interest in the stock ownership and
leasehold rights associated with the cooperative unit securing the related
Mortgage Note;
(d) All
payments due on or prior to the related Cut-off Date for such Mortgage
Loan have
been made as of the related Closing Date, the Mortgage Loan is not delinquent
thirty (30) days or more in payment and has not been dishonored; there
are no
material defaults under the terms of the Mortgage Loan; the Seller has
not
advanced funds, or induced, solicited or knowingly received any advance
of funds
from a party other than the owner of the Mortgaged Property subject to
the
Mortgage, directly or indirectly, for the payment of any amount required
by the
Mortgage Loan; as to each Mortgage Loan, there has been no more than one
thirty
(30) day delinquency during the immediately preceding twelve-month
period;
(e) All
taxes, governmental assessments, insurance premiums, water, sewer and municipal
charges, leasehold payments or ground rents which previously became due
and
owing have been paid, or escrow funds have been established in an amount
sufficient to pay for every such escrowed item which remains unpaid and
which
has been assessed but is not yet due and payable;
(f) The
terms
of the Mortgage Note and the Mortgage have not been impaired, waived, altered
or
modified in any respect, except by written instruments which have been
recorded
to the extent any such recordation is required by law, or, necessary to
protect
the interest of the Purchaser. No instrument of waiver, alteration or
modification has been executed in connection with such Mortgage Loan, and
no
Mortgagor has been released, in whole or in part, from the terms thereof
except
in connection with an assumption agreement and which assumption agreement
is
part of the Mortgage File and the terms of which are reflected in the Mortgage
Loan Schedule; the substance of any such waiver, alteration or modification
has
been approved by the issuer of any related Primary Mortgage Insurance Policy
and
title insurance policy, to the extent required by the related
policies;
(g) The
Mortgage Note and the Mortgage are not subject to any right of rescission,
set-off, counterclaim or defense, including, without limitation, the defense
of
usury, nor will the operation of any of the terms of the Mortgage Note
or the
Mortgage, or the exercise of any right thereunder, render the Mortgage
Note or
Mortgage unenforceable, in whole or in part, or subject to any right of
rescission, set-off, counterclaim or defense, including the defense of
usury,
and no such right of rescission, set-off, counterclaim or defense has been
asserted with respect thereto;
(h) All
buildings or other customarily insured improvements upon the Mortgaged
Property
are insured by an insurer acceptable under the Xxxxxx Xxx Guides, against
loss
by fire, hazards of extended coverage and such other hazards as are provided
for
in the Xxxxxx Mae Guides or by Xxxxxxx Mac, as well as all additional
requirements set forth in Section 4.10 of this Agreement. All such standard
hazard policies are in full force and effect and on the date of origination
contained a standard mortgagee clause naming the Seller and its successors
in
interest and assigns as loss payee and such clause is still in effect and
all
premiums due thereon have been paid. If required by the Flood Disaster
Protection Act of 1973, as amended, the Mortgage Loan is covered by a flood
insurance policy meeting the requirements of the current guidelines of
the
Federal Insurance Administration which policy conforms to Xxxxxx Mae and
Xxxxxxx
Mac requirements, as well as all additional requirements set forth in Section
4.10 of this Agreement. Such policy was issued by an insurer acceptable
under
Xxxxxx Mae or Xxxxxxx Mac guidelines. The Mortgage obligates the Mortgagor
thereunder to maintain all such insurance at the Mortgagor’s cost and expense,
and upon the Mortgagor’s failure to do so, authorizes the holder of the Mortgage
to maintain such insurance at the Mortgagor’s cost and expense and to seek
reimbursement therefor from the Mortgagor;
(i) Any
and
all requirements of any federal, state or local law including, without
limitation, usury, truth-in-lending, real estate settlement procedures,
consumer
credit protection, equal credit opportunity or disclosure laws and all
predatory
and abusive lending laws applicable to the Mortgage Loan have been complied
with
in all material respects and the Seller shall deliver to the Purchaser,
upon
request, evidence of compliance thereof;
(j) The
Mortgage has not been satisfied, canceled or subordinated, in whole or
in part,
or rescinded, and the Mortgaged Property has not been released from the
lien of
the Mortgage, in whole or in part nor has any instrument been executed
that
would effect any such release, cancellation, subordination or rescission.
The
Seller has not waived the performance by the Mortgagor of any action, if
the
Mortgagor’s failure to perform such action would cause the Mortgage Loan to be
in default, nor has the Seller waived any default resulting from any action
or
inaction by the Mortgagor;
(k) With
respect to any first lien Mortgage Loan, the related Mortgage is a valid,
subsisting, enforceable and perfected first lien on the Mortgaged Property
and,
with respect to any second lien Mortgage Loan, the related Mortgage is
a valid,
subsisting, enforceable and perfected second lien on the Mortgaged Property,
including for Mortgage Loans that are not Co-op Loans, all buildings on
the
Mortgaged Property and all installations and mechanical, electrical, plumbing,
heating and air conditioning systems affixed to such buildings, and all
additions, alterations and replacements made at any time with respect to
the
foregoing securing the Mortgage Note’s original principal balance. The Mortgage
and the Mortgage Note do not contain any evidence of any security interest
or
other interest or right thereto. Such lien is free and clear of all adverse
claims, liens and encumbrances having priority over the first or second
lien, as
applicable, of the Mortgage subject only to (1) with respect to any second
lien
Mortgage Loan, the related First Lien, (2) the lien of non-delinquent current
real property taxes and assessments not yet due and payable, (3) covenants,
conditions and restrictions, rights of way, easements and other matters
of the
public record as of the date of recording which are acceptable to mortgage
lending institutions generally and either (A) which are referred to or
otherwise
considered in the appraisal made for the originator of the Mortgage Loan,
or (B)
which do not adversely affect the appraised value of the Mortgaged Property
as
set forth in such appraisal, and (4) other matters to which like properties
are
commonly subject which do not materially interfere with the benefits of
the
security intended to be provided by the Mortgage or the use, enjoyment,
value or
marketability of the related Mortgaged Property. Any security agreement,
chattel
mortgage or equivalent document related to and delivered in connection
with the
Mortgage Loan establishes and creates (1) with respect to any first lien
Mortgage Loan, a valid, subsisting, enforceable and perfected first lien
and
first priority security interest and (2) with respect to any second lien
Mortgage Loan, a valid, subsisting, enforceable and perfected second lien
and
second priority security interest, in each case, on the property described
therein, and the Seller has the full right to sell and assign the same
to the
Purchaser;
(l) The
Mortgage Note and the related Mortgage are original and genuine and each
is the
legal, valid and binding obligation of the maker thereof, enforceable in
all
respects in accordance with its terms, except as such enforcement may be
limited
by bankruptcy, insolvency, moratorium, reorganization and other laws of
general
application affecting the rights of creditors generally
and the equitable remedy of specific performance and by
general equitable principles. All parties to the Mortgage Note and the
related
Mortgage had the legal capacity to enter into the Mortgage Loan and to
execute
and deliver the Mortgage Note and the related Mortgage. The Mortgage Note
and
the related Mortgage have been duly and properly executed by such parties.
No
fraud, error, omission, misrepresentation, negligence or similar occurrence
with
respect to a Mortgage Loan has taken place on the part of Seller, the Mortgagor,
any appraisers, any builder or developer, or any other party involved in
the
origination of the Mortgage Loan or in the application for any insurance
in
relation to such Mortgage Loan. The proceeds of the Mortgage Loan have
been
fully disbursed and there is no requirement for future advances thereunder,
and
any and all requirements as to completion of any on-site or off-site
improvements and as to disbursements of any escrow funds therefor have
been
complied with. All costs, fees and expenses incurred in making or closing
the
Mortgage Loan and the recording of the Mortgage were paid or are in the
process
of being paid, and the Mortgagor is not entitled to any refund of any amounts
paid or due under the Mortgage Note or related Mortgage;
(m) Except
with respect to MERS Mortgage Loans, the Seller or its affiliate is the
sole
owner of record and holder of the Mortgage Loan and the indebtedness evidenced
by the Mortgage Note, and upon recordation the Purchaser or its designee
will be
the owner of record of the Mortgage and the indebtedness evidenced by the
Mortgage Note, and upon the sale of the Mortgage Loan to the Purchaser,
the
Seller will retain the Servicing File in trust for the Purchaser only for
the
purpose of servicing and supervising the servicing of the Mortgage Loan.
Immediately prior to the transfer and assignment to the Purchaser on the
related
Closing Date, the Mortgage Loan, including the Mortgage Note and the Mortgage,
were not subject to an assignment or pledge, and the Seller had good and
marketable title to and was the sole owner thereof and had full right to
transfer and sell the Mortgage Loan to the Purchaser free and clear of
any
encumbrance, equity, lien, pledge, charge, claim or security interest and
has
the full right and authority subject to no interest or participation of,
or
agreement with, any other party, to sell and assign the Mortgage Loan pursuant
to this Agreement and following the sale of the Mortgage Loan, the Purchaser
will own such Mortgage Loan free and clear of any encumbrance, equity,
participation interest, lien, pledge, charge, claim or security interest.
The
Seller intends to relinquish all rights to possess, control and monitor
the
Mortgage Loan, except for the purposes of servicing the Mortgage Loan as
set
forth in this Agreement;
(n) Each
Mortgage Loan that is not a Co-op Loan is covered by an ALTA lender’s title
insurance policy or other generally acceptable form of policy or insurance
acceptable to Xxxxxx Xxx or Xxxxxxx Mac, issued by a title insurer acceptable
to
Xxxxxx Mae or Xxxxxxx Mac and qualified to do business in the jurisdiction
where
the Mortgaged Property is located, insuring (subject to the exceptions
contained
in (k)(1), (2), (3) and (4) above) the Seller, its successors and assigns,
as to
the first or second priority lien, as applicable, of the Mortgage in the
original principal amount of the Mortgage Loan. Where required by applicable
state law or regulation, the Mortgagor has been given the opportunity to
choose
the carrier of the required mortgage title insurance. The Seller, its successors
and assigns, are the sole insureds of such lender’s title insurance policy, such
title insurance policy has been duly and validly endorsed to the Purchaser
or
the assignment to the Purchaser of the Seller’s interest therein does not
require the consent of or notification to the insurer and such lender’s title
insurance policy is in full force and effect and will be in full force
and
effect upon the consummation of the transactions contemplated by this Agreement
and the related Purchase Price and Terms Letter. No claims have been made
under
such lender’s title insurance policy, and no prior holder of the related
Mortgage, including the Seller, has done, by act or omission, anything
which
would impair the coverage of such lender’s title insurance policy;
(o) Except
as
shown on the related Mortgage Loan Schedule or a supplement thereto, there
is no
default, breach, violation or event of acceleration existing under the
Mortgage
or the related Mortgage Note and no event which, with the passage of time
or
with notice and the expiration of any grace or cure period, would constitute
a
default, breach, violation or event permitting acceleration; and neither
the
Seller nor, to the Seller’s knowledge, any prior mortgagee has waived any
default, breach, violation or event permitting acceleration. With respect
to
each second lien Mortgage Loan, (i) the First Lien is in full force and
effect,
(ii) there is no default, breach, violation or event of acceleration existing
under such prior mortgage or the related mortgage note, (iii) no event
which,
with the passage of time or with notice and the expiration of any grace
or cure
period, would constitute a default, breach, violation or event of acceleration
thereunder, and either (A) the prior mortgage contains a provision which
allows
or (B) applicable law requires, the mortgagee under the second lien Mortgage
Loan to receive notice of, and affords such mortgagee an opportunity to
cure any
default by payment in full or otherwise under the prior mortgage;
(p) As
of the
date of origination, and to the Seller’s knowledge, as of the Closing Date,
there were no mechanics’ or similar liens or claims which have been filed for
work, labor or material (and no rights are outstanding that under law could
give
rise to such liens) affecting the related Mortgaged Property which were,
are or
may be liens prior to or equal to the lien of the related Mortgage, which
are
not insured against by the title insurance policy referenced in paragraph
(n)
above;
(q) All
improvements subject to the Mortgage which were considered in determining
the
Appraised Value of the Mortgaged Property lie wholly within the boundaries
and
building restriction lines of the Mortgaged Property (and wholly within
the
project with respect to a condominium unit) and no improvements on adjoining
properties encroach upon the Mortgaged Property except those which are
insured
against by the title insurance policy referred to in clause (n) above and
all
improvements on the property comply with all applicable zoning and subdivision
laws and ordinances;
(r) The
Mortgage Loan was originated by or for the Seller. The Mortgage Loan complies
with the terms, conditions and requirements of the Underwriting Standards
in all
material respects. The Mortgage Notes and Mortgages (exclusive of any riders)
are on forms generally acceptable to Xxxxxx Xxx or Xxxxxxx Mac. The Mortgage
Loan bears interest at the Mortgage Interest Rate set forth in the related
Mortgage Loan Schedule, and Monthly Payments under the Mortgage Note are
due and
payable on the first day of each month. The Mortgage contains the usual
and
enforceable provisions of the originator at the time of origination for
the
acceleration of the payment of the unpaid principal amount of the Mortgage
Loan
if the related Mortgaged Property is sold without the prior consent of
the
mortgagee thereunder;
(s) The
Mortgaged Property at origination of the related Mortgage Loan was and
currently
is free of material damage and waste. At origination of the Mortgage Loan
there
was and there currently is, no proceeding pending for the total or partial
condemnation of the Mortgaged Property;
(t) The
related Mortgage contains customary and enforceable provisions such as
to render
the rights and remedies of the holder thereof adequate for the realization
against the Mortgaged Property of the benefits of the security provided
thereby.
There is no homestead or other exemption available to the Mortgagor which
would
interfere with the right to sell the Mortgaged Property at a trustee’s sale or
the right to foreclose the Mortgage subject to applicable federal and state
laws
and judicial precedent with respect to bankruptcy and right of
redemption;
(u) If
the
Mortgage constitutes a deed of trust, a trustee, authorized and duly qualified
if required under applicable law to act as such, has been properly designated
and currently so serves and is named in the Mortgage, and no fees or expenses,
except as may be required by local law, are or will become payable by the
Purchaser to the trustee under the deed of trust, except in connection
with a
trustee’s sale or attempted sale after default by the Mortgagor;
(v) If
required by the applicable processing style, the Mortgage File contains
an
appraisal of the related Mortgaged Property, in a form acceptable to Xxxxxx
Mae
or Xxxxxxx Mac, and such appraisal complies with the requirements of FIRREA
and,
to the extent required in the Underwriting Standards with respect to mortgage
loans of the same type as the Mortgage Loan, was signed prior to the final
approval of the mortgage loan application by a Qualified Appraiser;
(w) All
parties which have had any interest in the Mortgage, whether as mortgagee,
assignee, pledgee or otherwise, are (or, during the period in which they
held
and disposed of such interest, were) (A) in compliance with any and all
applicable licensing requirements of the laws of the state wherein the
Mortgaged
Property is located, and (B) (1) organized under the laws of such state,
or (2)
qualified to do business in such state, or (3) federal savings and loan
associations or national banks or a Federal Home Loan Bank or savings bank
having principal offices in such state, or (4) not doing business in such
state;
(x) The
related Mortgage Note is not and has not been secured by any collateral
except
the lien of the corresponding Mortgage and the security interest of any
applicable security agreement or chattel mortgage referred to in clause
(k)
above and such collateral does not serve as security for any other
obligation;
(y) No
Mortgage Loan contains provisions pursuant to which Monthly Payments are
(a)
paid or partially paid with funds deposited in any separate account established
by the Seller, the Mortgagor or anyone on behalf of the Mortgagor, (b)
paid by
any source other than the Mortgagor or (c) contains any other similar provisions
which may constitute a “buydown” provision. The Mortgage Loan is not a graduated
payment mortgage loan and the Mortgage Loan does not have shared appreciation
or
other contingent interest feature;
(z) The
Mortgagor was not in bankruptcy or insolvent as of the date of origination
of
the Mortgage Loan and is not in bankruptcy or insolvent as of the related
Closing Date;
(aa) Each
Fixed Rate Mortgage Loan has an original term to maturity of not more than
thirty (30) years, with interest calculated and payable in arrears on the
first
day of each month in equal monthly installments of principal and interest.
Except with respect to Interest Only Mortgage Loans, each Mortgage Note
requires
a monthly payment which is sufficient to fully amortize the original principal
balance of the Mortgage Loan fully by the stated maturity date, over an
original
term of not more than thirty (30) years and to pay interest at the related
Mortgage Interest Rate; provided, however, in the case of a balloon Mortgage
Loan, the Mortgage Loan matures at least five (5) years after the first
payment
date thereby requiring a final payment of the outstanding principal balance
prior to the full amortization of the Mortgage Loan. No Mortgage Loan contains
terms or provisions which would result in negative amortization;
(bb) If
a
Mortgage Loan has an LTV greater than 80%, the portion of the principal
balance
of such Mortgage Loan in excess of the portion of the Appraisal Value of
the
Mortgaged Property required by Xxxxxx Mae, is and will be insured as to
payment
defaults by a Primary Mortgage Insurance Policy issued by a Qualified Insurer.
All provisions of such Primary Mortgage Insurance Policy have been and
are being
complied with, such policy is in full force and effect, and all premiums
due
thereunder have been paid. No action, inaction, or event has occurred and
no
state of facts exists that has, or will result in the exclusion from, denial
of,
or defense to coverage. Any Mortgage Loan subject to a Primary Mortgage
Insurance Policy obligates the Mortgagor thereunder to maintain the Primary
Mortgage Insurance Policy and to pay all premiums and charges in connection
therewith. The mortgage interest rate for the Mortgage Loan as set forth
on the
related Mortgage Loan Schedule is net of any such insurance
premium;
(cc) The
Assignment of Mortgage is in recordable form and is acceptable for recording
under the laws of the jurisdiction in which the Mortgaged Property is
located;
(dd) As
to
Mortgage Loans that are not Co-op Loans and that are not secured by an
interest
in a leasehold estate, the Mortgaged Property is located in the state identified
in the related Mortgage Loan Schedule and consists of a single parcel of
real
property with a detached single family residence erected thereon, or a
townhouse, or a two-to four-family dwelling, or an individual condominium
unit
in a condominium project, or an individual unit in a planned unit development
or
a de minimis planned unit development, provided,
however,
that no
residence or dwelling is a mobile home. If the residential dwelling on
the
Mortgaged Property is a condominium unit or a unit in a planned unit development
(other than a de minimis planned unit development) such condominium or
planned
unit development project meets the eligibility requirements of Xxxxxx Xxx
and
Xxxxxxx Mac and/or the Underwriting Standards;
(ee) Except
with respect to Interest Only Mortgage Loans, principal payments on the
Mortgage
Loan commenced no more than sixty (60) days after the funds were disbursed
in
connection with such Mortgage Loan;
(ff) The
Mortgaged Property is lawfully occupied under applicable law; all inspections,
licenses and certificates required to be made or issued with respect to
all
occupied portions of the Mortgaged Property and, with respect to the use
and
occupancy of the same, including but not limited to certificates of occupancy
and fire underwriting certificates, have been made or obtained from the
appropriate authorities;
(gg) The
Mortgaged Property is in material compliance with all applicable environmental
laws pertaining to environmental hazards including, without limitation,
asbestos, and neither the Seller nor, to the Seller’s knowledge, the related
Mortgagor, has received any notice of any violation or potential violation
of
such law;
(hh) The
related Mortgagor has not notified the Seller, and the Seller has no knowledge
of any relief requested or allowed to the Mortgagor under the Servicemembers
Civil Relief Act;
(ii) Each
Mortgage Loan has been serviced in all material respects in compliance
with
Accepted Servicing Practices;
(jj) With
respect to each Co-op Loan, the related Mortgage is a valid, enforceable
and
subsisting first security interest on the related cooperative shares securing
the related cooperative note, subject only to (a) liens of the cooperative
for
unpaid assessments representing the Mortgagor’s pro rata share of the
cooperative’s payments for its blanket mortgage, current and future real
property taxes, insurance premiums, maintenance fees and other assessments
to
which like collateral is commonly subject and (b) other matters to which
like
collateral is commonly subject which do not materially interfere with the
benefits of the security intended to be provided by the Security Agreement.
There are no liens against or security interest in the cooperative shares
relating to each Co-op Loan (except for unpaid maintenance, assessments
and
other amounts owed to the related cooperative which individually or in
the
aggregate will not have a material adverse effect on such Co-op Loan),
which
have priority over the Seller’s security interest in such cooperative
shares;
(kk) With
respect to each Co-op Loan, a search for filings of financing statements
has
been made by a company competent to make the same, which company is acceptable
to Xxxxxx Xxx and qualified to do business in the jurisdiction where the
cooperative unit is located, and such search has not found anything which
would
materially and adversely affect the Co-op Loan;
(ll) With
respect to each Co-op Loan, the related cooperative corporation that owns
title
to the related cooperative apartment building is a “cooperative housing
corporation” within the meaning of Section 216 of the Code, and is in material
compliance with applicable federal, state and local laws which, if not
complied
with, could have a material adverse effect on the Mortgaged
Property;
(mm) With
respect to each Co-op Loan, there is no prohibition against pledging the
shares
of the cooperative corporation or assigning the Co-op Lease;
(nn) The
Mortgage Loan was originated by a mortgagee approved by the Secretary of
Housing
and Urban Development pursuant to sections 203 and 211 of the National
Housing
Act, a savings and loan association, a savings bank, a commercial bank,
credit
union, insurance company or similar institution which is supervised and
examined
by a federal or state authority;
(oo) [Reserved];
(pp) With
respect to any broker fees collected and paid on any of the Mortgage Loans,
all
broker fees have been properly assessed to the borrower and no claims will
arise
as to broker fees that are double charged and for which the borrower would
be
entitled to reimbursement;
(qq) Each
Mortgage Loan constitutes a “qualified mortgage” under
Section 860G(a)(3)(A) of the Code and Treasury Regulations Section
1.860G-2(a)(1);
(rr) Except
as
provided in Section 2.07, the Mortgage Note, the Mortgage, the Assignment
of
Mortgage and the other documents set forth in Exhibit A-1 and required
to be
delivered on the related Closing Date have been delivered to the Purchaser
or
its designee;
(ss) To
the
Seller’s knowledge, all information supplied by, on behalf of, or concerning the
Mortgagor is true, accurate and complete and does not contain any statement
that
is or will be inaccurate or misleading in any material respect;
(tt) The
Mortgagor has executed a statement to the effect that the Mortgagor has
received
all disclosure materials required by applicable law with respect to the
making
of adjustable rate mortgage loans. The Seller shall maintain such statement
in
the Servicing File;
(uu) No
Mortgage Loan had a Loan-to-Value Ratio at the time of origination of more
than
100%. No second lien Mortgage Loan has an Equity LTV in excess of
100%;
(vv) Either
(a) no consent for the second lien Mortgage Loan is required by the holder
of
the related First Lien or (b) such consent has been obtained and is contained
in
the Mortgage File;
(ww) With
respect to any second lien Mortgage Loan, the Seller has not received notice
of:
(1) any proceeding for the total or partial condemnation of any Mortgaged
Property, (2) any subsequent, intervening mortgage, lien, attachment, lis
pendens or other encumbrance affecting any Mortgaged Property or (3) any
default
under any mortgage, lien or other encumbrance senior to each
Mortgage;
(xx) No
second
lien Mortgage Loan is a “home equity line of credit”;
(yy) As
of the
Closing Date, the Seller has not received a notice of default of a First
Lien
which has not been cured;
(zz) No
First
Lien provides for negative amortization;
(aaa) No
Mortgage Loan is classified as a “high cost” mortgage loan under the Home
Ownership and Equity Protection Act of 1994, as amended, nor is any Mortgage
Loan a “high cost home,” “covered” (excluding home loans defined as “covered
home loans” pursuant to the New Jersey Home Ownership Security Act of 2002),
“high risk home” or “predatory” loan under any applicable state, federal or
local law (or a similarly classified loan using different terminology under
an
applicable law imposing heightened regulatory scrutiny or additional legal
liability for residential mortgage loans having high interest rates, points
and/or fees);
(bbb) None
of
the proceeds of the Mortgage Loan were used to finance single-premium credit
insurance policies;
(ccc) With
respect to any Mortgage Loan which is a Texas Home Equity Loan, any and
all
requirements of Section 50, Article XVI of the Texas Constitution applicable
to
Texas Home Equity Loans which were in effect at the time of the origination
of
the Mortgage Loan have been complied with. No Mortgage Loan is a Cash-Out
Refinancing;
(ddd) No
Mortgage Loan which was originated on or after October 1, 2002 and prior
to
March 7, 2003 is secured by a Mortgaged Property located in the State of
Georgia
has an original principal balance that is less than or equal to the applicable
conforming loan limit established by Xxxxxx Mae (as of the related origination
date);
(eee) The
origination and servicing practices with respect to each Mortgage Note
and
Mortgage have been legal and in accordance with applicable laws and regulations,
and in all material respects proper and prudent in the mortgage origination
and
servicing business. With respect to escrow deposits and payments that the
Seller
is entitled to collect, all such payments are in the possession of, or
under the
control of, the Seller, and there exist no deficiencies in connection therewith
for which customary arrangements for repayment thereof have not been made.
All
escrow payments have been collected and are being maintained in full compliance
with applicable state and federal law and the provisions of the related
Mortgage
Note and Mortgage. As to any Mortgage Loan that is the subject of an escrow,
escrow of funds is not prohibited by applicable law and has been established
in
an amount sufficient to pay for every escrowed item that remains unpaid
and has
been assessed but is not yet due and payable. No escrow deposits or other
charges or payments due under the Mortgage Note have been capitalized under
any
Mortgage or the related Mortgage Note. All Mortgage Interest Rate adjustments
have been made in strict compliance with state and federal law and the
terms of
the related Mortgage Note. Any interest required to be paid pursuant to
state
and local law has been properly paid and credited;
(fff) No
Mortgage Loan is a Convertible Mortgage Loan;
(ggg) All
predatory and abusive lending laws applicable to the origination and servicing
of mortgage loans of a type similar to the Mortgage Loans have been complied
with and the consummation of the transactions contemplated hereby will
not
involve the violation of any such laws, and the Seller shall maintain in
its
possession, available for the inspection of the Purchaser or its designee,
and
shall deliver to the Purchaser or its designee, upon ten (10) Business
Days’
request, evidence of compliance with such requirements;
(hhh) The
Mortgage Loan was underwritten in accordance with the underwriting guidelines
of
the Seller in effect at the time the Mortgage Loan was originated, and
the
Mortgage Note and Mortgage are on forms acceptable to Xxxxxx Xxx and Xxxxxxx
Mac;
(iii) No
Mortgage Loan was made in connection with the construction or rehabilitation
of
a Mortgaged Property;
(jjj) Each
original Mortgage was recorded and all subsequent assignments of the original
Mortgage (other than the assignment to the Purchaser) have been recorded,
or are
in the process of being recorded, in the appropriate jurisdictions wherein
such
recordation is necessary to perfect the lien thereof as against creditors
of the
Seller. As to any Mortgage Loan which is not a MERS Mortgage Loan, the
Assignment of Mortgage is in recordable form and is acceptable for recording
under the laws of the jurisdiction in which the Mortgaged Property is
located;
(kkk) Any
principal advances made on behalf of the Mortgagor prior to the Cut-off
Date
have been consolidated with the outstanding principal amount secured by
the
Mortgage, and the secured principal amount, as consolidated, bears a single
interest rate and single repayment term reflected on the Mortgage Loan
Schedule.
The lien of the Mortgage securing the consolidated principal amount is
expressly
insured as having (A) First Lien priority with respect to each Mortgage
Loan
which is indicated by the Seller to be a First Lien (as reflected on the
Mortgage Loan Schedule), or (B) second lien priority with respect to each
Mortgage Loan which is indicated by the Seller to be a Second Lien Mortgage
Loan
(as reflected on the Mortgage Loan Schedule), in either case, by a title
insurance policy, an endorsement to the policy insuring the mortgagee’s
consolidated interest or by other title evidence acceptable to Xxxxxx Mae
and
Xxxxxxx Mac. The consolidated principal amount does not exceed the original
principal amount of the Mortgage Loan;
(lll) Interest
on each Mortgage Loan is calculated on the basis of a 360-day year consisting
of
twelve 30-day months;
(mmm) With
respect to each Mortgage Loan, the Seller has fully and accurately furnished
complete information on the related borrower credit files to Equifax, Experian
and Trans Union Credit Information Company, in accordance with the Fair
Credit
Reporting Act and its implementing regulations, on a monthly basis and
the
Seller for each Loan will furnish, in accordance with the Fair Credit Reporting
Act and its implementing regulations, accurate and complete information
on its
borrower credit files to Equifax, Experian, and Trans Union Credit Information
Company, on a monthly basis;
(nnn) The
debt-to-income ratio of the related Mortgagor was not greater than 55%
at the
origination of the related Mortgage Loan;
(ooo) No
Mortgagor was required to purchase any credit life, disability, accident
or
health insurance product or debt cancellation agreement as a condition
of
obtaining the extension of credit. No Mortgagor obtained a prepaid single
premium credit life, disability, accident or health insurance policy in
connection with the origination of the Mortgage Loan. No proceeds from
any
Mortgage Loan were used to purchase single premium credit insurance policies
or
debt cancellation agreements as part of the origination of, or as a condition
to
closing, such Mortgage Loan;
(ppp) The
Mortgage Loans were not selected from the outstanding one to four-family
mortgage loans in the Seller’s portfolio at the related Closing Date as to which
the representations and warranties set forth in this Agreement could be
made in
a manner so as to affect adversely the interests of the Purchaser;
(qqq) The
Mortgage Loan complies with all applicable consumer credit statutes and
regulations, including, without limitation, the respective Uniform Consumer
Credit Code laws in effect in Colorado, Idaho, Indiana, Iowa, Kansas, Maine,
Oklahoma, South Carolina, Utah and Wyoming, has been originated by a properly
licensed entity, and in all other respects, complies with all of the material
requirements of any such applicable laws;
(rrr) Prepayment
penalty information set forth in the Mortgage Loan Schedule is complete,
true
and correct in all material respects and each prepayment penalty is permissible,
enforceable and collectable under applicable federal and state law;
(sss) The
Mortgage Loan was not prepaid in full prior to the Closing Date and the
Seller
has not received notification from a Mortgagor that a prepayment in full
shall
be made after the Closing Date;
(ttt)
As of
the date of origination, no portion of the Mortgaged Property was used
for
commercial purposes and, since the date of origination, no portion of the
Mortgaged Property has been used for commercial purposes, except as permitted
under the Underwriting Standards. No Mortgage Loan is secured by commercial
property;
(uuu) With
respect to any Mortgage Loan that contains a provision permitting imposition
of
a Prepayment Charge: (i) prior to the Mortgage Loan’s origination, the borrower
agreed to such Prepayment Charge in exchange for a monetary benefit, including
but not limited to a rate or fee reduction, (ii) prior to the Mortgage
Loan’s
origination, the borrower was offered the option of obtaining a mortgage
loan
that did not require payment of such a premium, (iii) the prepayment premium
is
disclosed to the borrower in the Mortgage Loan documents pursuant to applicable
state and federal law, (iv) for Mortgage Loans originated on or after September
1, 2004, the duration of the prepayment period shall not exceed three (3)
years
from the date of the note, unless the Mortgage Loan was modified to reduce
the
prepayment period to no more than three years from the date of the note
and the
borrower was notified in writing of such reduction in prepayment period,
and (v)
notwithstanding any state or federal law to the contrary, the Servicer
shall not
impose such prepayment premium in any instance when the mortgage debt is
accelerated as the result of the borrower’s default in making the Mortgage Loan
payments;
(vvv) The
Seller’s parent has adopted an Anti-Money Laundering and Terrorist-Finance
Policy (the “Policy”) that requires the Seller to comply with applicable
anti-money laundering laws and regulations, including without limitation
the USA
Patriot Act of 2001 (collectively, the “Anti-Money Laundering Laws”); the Seller
has established an anti-money laundering compliance program as required
by the
Policy, has procedure in place to conduct due diligence, based upon the
Seller’s
risk assessment of the applicable Mortgagor, in connection with the origination
of each Mortgage Loan for purposes of the Policy, including the verification
of
the identity of the applicable Mortgagor and, where required, the origin
of the
assets used by the said Mortgagor to purchase the property in question
and has
procedures, including record keeping procedures, in place to comply with
Section
326 of the USA Patriot Act of 2001 and its implementing regulation 31 CFR
103.121 regarding the identity of the applicable Mortgagor. On or before
the
closing of any Mortgage Loan, the Seller conducts or causes to be conducted
an
OFAC screening of the Mortgagor to comply with regulations of the Office
of
Foreign Assets Control (“OFAC”) of the United States Department of the Treasury
implementing certain United States laws and the executive orders issued
under
the authority of such laws; and thereafter Seller periodically re-screens
or
causes the re-screening of Mortgagors when the OFAC sanctioned parties
lists are
updated;
(www) No
Mortgage Loan is secured by real property located in the state of Georgia
unless
(x) such Mortgage Loan was originated prior to October 1, 2002 or after
March 6,
2003, or (y) the property securing the Mortgage Loan is not, nor will be,
occupied by the Mortgagor as the Mortgagor’s principal dwelling. No Mortgage
Loan is a “High Cost Home Loan” as defined in the Georgia Fair Lending Act, as
amended (the “Georgia Act”). Each Mortgage Loan that is a “Home Loan” under the
Georgia Act complies with all applicable provisions of the Georgia
Act;
(xxx) No
Mortgage Loan is secured by manufactured housing;
(yyy) No
Mortgage Loan (a) is secured by property located in the State of New York;
(b)
had an unpaid principal balance at origination of $300,000 or less, and
(c) has
an application date on or after April 1, 2003, the terms of which Mortgage
Loan
equal or exceed either the APR or the points and fees threshold for “high-cost
home loans”, as defined in Section 6-1 of the New York State Banking
Law;
(zzz) All
points and fees related to each Mortgage Loan were disclosed in writing
to the
related Mortgagor in accordance with applicable state and federal law and
regulation. Except in the case of a Mortgage Loan in an original principal
amount of less than $60,000 which would have resulted in an unprofitable
origination, no related Mortgagor was charged “points and fees” (whether or not
financed) in an amount greater than 5% of the principal amount of such
loan,
such 5% limitation is calculated in accordance with Xxxxxx Mae’s anti-predatory
lending requirements as set forth in the Xxxxxx Mae Selling Guide. All
fees and
charges (including finance charges) and whether or not financed, assessed,
collected or to be collected in connection with the origination and servicing
of
each such Mortgage Loan were disclosed in writing to the related Mortgagor
in
accordance with applicable state and federal law and regulation;
(aaaa) The
Seller will transmit full-file credit reporting data for each Mortgage
Loan
pursuant to Xxxxxx Xxx Guide Announcement 95-19 and for each Mortgage Loan,
Seller agrees it shall report one of the following statuses each month
as
follows: new origination, current, delinquent (30-, 60-, 90-days, etc.),
foreclosed, or charged-off;
(bbbb) With
respect to each MERS Mortgage Loan, a MIN has been assigned by MERS and
such MIN
is accurately provided on the related Mortgage Loan Schedule. The related
assignment of Mortgage to MERS has been duly and properly recorded or submitted
for recording;
(cccc) With
respect to each MERS Mortgage Loan, the Seller has not received any notice
of
liens or legal actions with respect to such Mortgage Loan and no such notices
have been electronically posted by MERS
(dddd) No
Mortgage Loan is a “High-Cost” loan as defined under the New York Banking Law
Section 6-1, as amended effective as of April 1, 2003;
(eeee) No
Mortgage Loan is a “High Cost Home Loan” as defined in the Arkansas Home Loan
Protection Act effective July 16, 2003, as amended (Act 1340 or
2003);
(ffff) No
Mortgage Loan is a “High Cost Home Loan” as defined in the Kentucky high-cost
loan statute effective June 24, 2003, as amended (Ky. Rev. Stat. Section
360.100);
(gggg) No
Mortgage Loan is a “high cost home,” “covered” (excluding home loans defined as
“covered home loans” in the New Jersey Home Ownership Security Act of 2002 that
were originated between November 26, 2003 and July 7, 2004), “high risk home” 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);
(hhhh) No
Mortgage Loan is a “High-Cost Home Loan” as defined in the New Mexico Home Loan
Protection Act effective January 1, 2004, as amended (N.M. Stat. Xxx. §§
58-21A-1 et seq.);
(iiii) No
Mortgage Loan is a “High-Risk Home Loan” as defined in the Illinois High-Risk
Home Loan Act effective January 1, 2004, as amended (815 Ill. Comp. Stat.
137/1
et seq.);
(jjjj) No
Mortgage Loan is a “High-Cost Home Mortgage Loan” as defined in the
Massachusetts Predatory Home Loan Practices Act, effective November 7,
2004
(Mass. Xxx. Laws Ch. 183C);
(kkkk) No
Mortgagor agreed to submit to arbitration to resolve any dispute arising
out of
or relating in any way to the Mortgage Loan transaction.
(llll) With
respect to each Mortgage Loan that is secured in whole or in part by the
interest of the mortgagor as a lessee under a ground lease of the related
Mortgaged Property (a “Ground Lease”) and not by a fee interest in such
mortgaged property:
(i) The
mortgagor is the owner of a valid and subsisting interest as tenant under
the
Ground Lease;
(ii) The
Ground Lease is in full force and effect;
(iii) The
mortgagor is not in default under any of the terms thereof and no event
which,
with the passage of time or the giving of notice and the expiration of
any grace
or cure period or both, would constitute an event of default
thereunder;
(iv) The
lessee under the Ground Lease us not in default under any of the terms
or
provisions thereof on the part of the lessee to be observed or
performed;
(v) The
term
of the Ground Lease exceeds the maturity date of the related Mortgage Loan
by at
least ten (10) years;
(vi) The
Ground Lease or a memorandum thereof has been recorded and by its terms
permits
the leasehold estate to be mortgaged. The Ground Lease grants any leasehold
mortgage protection necessary to protect the security of a leasehold
mortgage;
(vii) The
execution, delivery and performance of the Mortgage do not require the
consent
(other than those consents which have been obtained and are in full force
and
effect) under, and will not contravene any provision of or cause a default
under, the Ground Lease; and
(viii) The
Ground Lease provides that the leasehold can be transferred, mortgaged
and
sublet an unlimited number of times either without restriction or on payment
of
a reasonable fee and delivery of reasonable documentation to the
lessor.
SECTION
4.03 Repurchase;
Substitution.
It
is
understood and agreed that the representations and warranties set forth
in
Sections 3.01 and 3.02 shall survive the sale of the Mortgage Loans and
delivery
of the Mortgage File to the Purchaser, or its designee, and shall inure
to the
benefit of the Purchaser, notwithstanding any restrictive or qualified
endorsement on any Mortgage Note or Assignment of Mortgage or the examination,
or lack of examination, of any Mortgage Loan Document. Upon discovery by
the
Seller or the Purchaser of a breach of any of the foregoing representations
and
warranties which materially and adversely affects the value of the Mortgage
Loans or the interest of the Purchaser in any Mortgage Loan, the party
discovering such breach shall give prompt written notice to the others.
The
Seller shall have a period of ninety (90) days from the earlier of its
discovery
or its receipt of notice of any such breach within which to correct or
cure such
breach. The Seller hereby covenants and agrees that if any such breach
is not
corrected or cured within such ninety (90) day period, the Seller shall,
at the
Purchaser’s option, either repurchase such Mortgage Loan at the Repurchase Price
plus the reasonable and customary out-of-pocket expenses incurred by the
Purchaser in transferring such Mortgage Loan or substitute a mortgage loan
for
the Defective Mortgage Loan as provided below. In the event that any such
breach
shall involve any representation or warranty set forth in Section 3.01,
and such
breach is not cured within ninety (90) of the earlier of either discovery
by or
notice to the Seller of such breach, all affected Mortgage Loans shall,
at the
option of the Purchaser, be repurchased by the Seller at the Repurchase
Price.
Any such repurchase shall be accomplished by deposit in the Custodial Account
of
the amount of the Repurchase Price in no event later than five (5) Business
Days
after demand therefor.
It
is
hereby understood, notwithstanding anything to the contrary contained herein,
that a breach of any predatory lending representations will be deemed to
materially and adversely affect the value of the related Mortgage
Loan.
If
pursuant to the foregoing provisions the Seller repurchases a Mortgage
Loan that
is a MERS Mortgage Loan, the Seller shall either (i) cause MERS to execute
and
deliver an assignment of the Mortgage in recordable form to transfer the
Mortgage from MERS to the Seller and shall cause such Mortgage to be removed
from registration on the MERS® System in accordance with MERS’ rules and
regulations or (ii) cause MERS to designate on the MERS® System the Seller as
the beneficial holder of such Mortgage Loan.
If
the
Seller is required to repurchase any Mortgage Loan pursuant to this Section
3.03
as a result of a breach of any of the representations and warranties set
forth
in Section 3.02, the Seller may, with the Purchaser’s prior consent, which
consent shall not be unreasonably withheld, within sixty (60) days from
the
related Closing Date, remove such defective Mortgage Loan from the terms
of this
Agreement and substitute another mortgage loan for such defective Mortgage
Loan,
in lieu of repurchasing such defective Mortgage Loan. Any substitute Mortgage
Loan shall (a) have a principal balance at the time of substitution not
in
excess of the principal balance of the defective Mortgage Loan (the amount
of
any difference, plus one month’s interest thereon at the Mortgage Interest Rate
borne by the defective Mortgage Loan, being paid by the Seller and deemed
to be
a Principal Prepayment to be deposited by the Seller in the Custodial Account),
(b) have a Mortgage Interest Rate not less than, and not more than one
percentage point greater than, the Mortgage Interest Rate of the removed
Mortgage Loan, (c) have a remaining term to stated maturity not later than,
and
not more than one year less than, the remaining term to stated maturity
of the
removed Mortgage Loan, (d) have a Loan-to-Value Ratio at origination no
greater
than that of the removed Mortgage Loan, (e) with respect to any second
lien
Mortgage Loan, have an Equity Loan-to-Value Ratio at origination no greater
than
that of the removed Mortgage Loan, (f) have the same lien priority as that
of
the removed Mortgage Loan and (g) be, in the reasonable determination of
the
Purchaser, in material compliance with the representations and warranties
contained in this Agreement and described in Section 3.02 as of the date
of
substitution.
The
Seller shall amend the related Mortgage Loan Schedule to reflect the withdrawal
of the removed Mortgage Loan from this Agreement and the substitution of
such
substitute Mortgage Loan therefor. Upon such amendment, the Purchaser shall
review the Mortgage File delivered to it relating to the substitute Mortgage
Loan. The Monthly Payment on a substitute Mortgage Loan due on the Due
Date in
the month of substitution shall be the property of the Seller and the Monthly
Payment on the Defective Mortgage Loan for which the substitution is made
due on
such date shall be the property of the Purchaser.
It
is
understood and agreed that the obligation of the Seller set forth in this
Section 3.03 to cure, repurchase or substitute for a defective Mortgage
Loan,
and to indemnify Purchaser pursuant to Section 7.01, constitutes the sole
remedies of the Purchaser respecting a breach of the foregoing representations
and warranties. If the Seller fails to repurchase or substitute for a defective
Mortgage Loan in accordance with this Section 3.03, or fails to cure a
defective
Mortgage Loan to Purchaser’s reasonable satisfaction in accordance with this
Section 3.03, or to indemnify Purchaser pursuant to Section 7.01, that
failure
shall, upon compliance by the Purchaser with the next to the last paragraph
of
this Section 3.03, be an Event of Default and the Purchaser shall be entitled
to
pursue all available remedies. No provision of this paragraph shall affect
the
rights of the Purchaser to terminate this Agreement for cause, as set forth
in
Sections 8.01 and 9.01.
Any
cause
of action against the Seller relating to or arising out of the breach of
any
representations and warranties made in Sections 3.01 and 3.02 shall accrue
as to
any Mortgage Loan upon (i) the earlier of discovery of such breach by the
Seller
or notice thereof by the Purchaser to the Seller, (ii) failure by the Seller
to
cure such breach or repurchase such Mortgage Loan as specified above, and
(iii)
demand upon the Seller by the Purchaser for compliance with this
Agreement.
In
the
event that any Mortgage Loan is held by a REMIC, notwithstanding any contrary
provision of this Agreement, with respect to any Mortgage Loan that is
not in
default or as to which no default is imminent, Purchaser may, in connection
with
any repurchase or substitution of a Defective Mortgage Loan pursuant to
this
Section 3.03, require that the Seller deliver, at the Seller’s expense, an
Opinion of Counsel to the effect that such repurchase or substitution will
not
(i) result in the imposition of taxes on “prohibited transactions” of such REMIC
(as defined in Section 860F of the Code) or otherwise subject the REMIC
to tax,
or (ii) cause the REMIC to fail to qualify as a REMIC at any time.
SECTION
4.04 Purchase
Price Protection.
In
the
event that (i) the principal due on any Mortgage Loan is prepaid in full
within
two months of the last day of the month of the related Cut-off Date, the
Seller
shall pay to the Purchaser, within five (5) Business Days of the Purchaser
notifying the Seller of such prepayment, an amount equal to the product
of (A)
the amount of such prepayment, times (B) the excess, if any, of the related
Purchase Price Percentage, as set forth on the related Trade Confirmation,
over
100% or (ii) either of the first two scheduled monthly payments due to
the
Purchaser following the related Cut-off Date on any Mortgage Loan is not
made by
the related mortgagor by the last day of the month in which it is or was
due,
such Mortgage Loan shall be repurchased by the Seller at the related Purchase
Price Percentage, times the aggregate principal balance of such Mortgage
Loan as
of the date of repurchase, together with accrued interest.
ARTICLE
V
ADMINISTRATION
AND SERVICING OF THE MORTGAGE LOANS
SECTION
5.01 The
Seller to Act as Servicer.
The
Seller, as independent contract servicer, shall service and administer
the
Mortgage Loans in accordance with this Agreement and with Accepted Servicing
Practices, and shall have full power and authority, acting alone or through
subservicers or agents, to do or cause to be done any and all things in
connection with such servicing and administration which the Seller may
deem
necessary or desirable and consistent with the terms of this Agreement
and with
Accepted Servicing Practices. The Seller shall service and administer the
Mortgage Loans through the exercise of the same care that it customarily
employs
for its own account. The Seller may perform its servicing responsibilities
through agents or independent contractors, but shall not thereby be released
from any of its responsibilities hereunder. Notwithstanding anything to
the
contrary, the Seller may delegate any of its duties under this Agreement
to one
or more of its affiliates without regard to any of the requirements of
this
Section; provided,
however,
that
the Seller shall not be released from any of its responsibilities hereunder
by
virtue of such delegation.
Except
as
set forth in this Agreement, the Seller shall service the Mortgage Loans
in
compliance with the servicing provisions of the Xxxxxx Xxx Guides (special
servicing option), which include, but are not limited to, provisions regarding
the liquidation of Mortgage Loans, the collection of Mortgage Loan payments,
the
payment of taxes, insurance and other charges, the maintenance of hazard
insurance with a Qualified Insurer, the maintenance of mortgage impairment
insurance, the maintenance of fidelity bond and errors and omissions insurance,
inspections, the restoration of Mortgaged Property, the maintenance of
Primary
Mortgage Insurance Policies, insurance claims, the title, management of
REO
Property, permitted withdrawals with respect to REO Property, liquidation
reports, and reports of foreclosures and abandonments of Mortgaged Property,
the
transfer of Mortgaged Property, the release of Mortgage Files, annual
statements, and examination of records and facilities. In the event of
any
conflict, inconsistency or discrepancy between any of the servicing provisions
of this Agreement and any of the servicing provisions of the Xxxxxx Mae
Guides,
the provisions of this Agreement shall control and be binding upon the
Purchaser
and the Seller.
Consistent
with the terms of this Agreement, the Seller may waive, modify or vary
any term
of any Mortgage Loan or consent to the postponement of any such term or
in any
manner grant indulgence to any Mortgagor if in the Seller’s reasonable and
prudent determination such waiver, modification, postponement or indulgence
is
not materially adverse to the Purchaser, provided,
however,
that
unless the Mortgagor is in default with respect to the Mortgage Loan, or
such
default is, in the judgment of the Seller, reasonably foreseeable, or the
Seller
has obtained the prior written consent of the Purchaser, the Seller shall
not
permit any modification with respect to any Mortgage Loan that would change
the
Mortgage Interest Rate, forgive the payment of any principal or interest,
reduce
or increase the outstanding principal balance (except for actual payments
of
principal), make any future advances or extend the final maturity date,
as the
case may be, with respect to such Mortgage Loan. In the event of any such
modification that permits the deferral of interest or principal payments
on any
Mortgage Loan, the Seller shall, on the Business Day immediately preceding
the
Remittance Date in any month in which any such principal or interest payment
has
been deferred, deposit in the Custodial Account from its own funds, in
accordance with Section 4.04, the difference between (a) the otherwise
scheduled
Monthly Payment and (b) the amount paid by the Mortgagor. The Seller shall
be
entitled to reimbursement for such advances to the same extent as for all
other
advances pursuant to Section 4.05. Without limiting the generality of the
foregoing, the Seller shall continue, and is hereby authorized and empowered
by
the Purchaser when the Seller believes it appropriate and reasonable in
its best
judgment, to prepare, execute and deliver, all instruments of satisfaction
or
cancellation, or of partial or full release, discharge and all other comparable
instruments, with respect to the Mortgage Loans and with respect to 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
Purchaser pursuant to the provisions of Section 4.13. Notwithstanding anything
herein to the contrary, the Seller may not enter into a forbearance agreement
or
similar arrangement with respect to any Mortgage Loan which runs more than
180
days after the first delinquent Due Date without the prior consent of the
Purchaser. Any such agreement shall be approved by any applicable holder
of a
Primary Mortgage Insurance Policy, if required.
The
Seller is authorized and empowered by the Purchaser, in its own name, when
the
Seller believes it appropriate in its reasonable judgment to register any
Mortgage Loan on the MERS® System, or cause the removal from the registration of
any Mortgage Loan on the MERS® System, to execute and deliver, on behalf of the
Purchaser, any and all instruments of assignment and other comparable
instruments with respect to such assignment or re-recording of a Mortgage
in the
name of MERS, solely as nominee for the Purchaser and its successors and
assigns.
The
Seller shall accurately and fully report its borrower credit files related
to
the Mortgage Loans to Equifax, Transunion and Experian in a timely
manner.
SECTION
5.02 Collection
of Mortgage Loan Payments.
Continuously
from the date hereof until the date each Mortgage Loan ceases to be serviced
subject to this Agreement, the Seller will proceed diligently to collect
all
payments due under each Mortgage Loan when the same shall become due and
payable
and shall, to the extent such procedures shall be consistent with this
Agreement, Accepted Servicing Practices, and the terms and provisions of
related
Primary Mortgage Insurance Policy, follow such collection procedures as
it
follows with respect to mortgage loans comparable to the Mortgage Loans
and held
for its own account. Further, the Seller will take special care in ascertaining
and estimating annual escrow payments, and all other charges that, as provided
in the Mortgage, will become due and payable, so that the installments
payable
by the Mortgagors will be sufficient to pay such charges as and when they
become
due and payable.
SECTION
5.03 Realization
Upon Defaulted Mortgage Loans.
The
Seller shall use commercially reasonable efforts, consistent with the procedures
that the Seller would use in servicing loans for its own account, Accepted
Servicing Practices, any Primary Mortgage Insurance and the best interest
of
Purchaser, to foreclose upon or otherwise comparably convert 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 4.01. Foreclosure or comparable
proceedings shall be initiated pursuant to Xxxxxx Xxx guidelines and applicable
state law with respect to Mortgaged Properties for which no satisfactory
arrangements can be made for collection of delinquent payments. The Seller
shall
use its best efforts to realize upon defaulted Mortgage Loans in such manner
as
will maximize the receipt of principal and interest by the Purchaser, taking
into account, among other things, the timing of foreclosure proceedings.
The
foregoing is subject to the provisions that, in any case in which the Mortgaged
Property shall have suffered damage, the Seller shall not be required to
expend
its own funds toward the restoration of such property unless it shall determine
in its discretion (i) that such restoration will increase the proceeds
of
liquidation of the related Mortgage Loan to the Purchaser after reimbursement
to
itself for such expenses, and (ii) that such expenses will be recoverable
by the
Seller through Insurance Proceeds or Liquidation Proceeds from the related
Mortgaged Property, as contemplated in Section 4.05. The Seller shall notify
the
Purchaser in writing (which may be by electronic mail) of the commencement
of
foreclosure proceedings. The Seller shall be responsible for all costs
and
expenses incurred by it in any such proceedings or functions; provided,
however,
that it
shall be entitled to reimbursement thereof from the related property, as
contemplated in Section 4.05. 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 Seller has reasonable cause to believe that
a
Mortgaged Property is contaminated by hazardous or toxic substances or
wastes,
or if the Purchaser otherwise requests an environmental inspection or review
of
such Mortgaged Property, such an inspection or review is to be conducted
by a
qualified inspector at the Purchaser’s expense. Upon completion of the
inspection, the Seller shall promptly provide the Purchaser with a written
report of the environmental inspection. After reviewing the environmental
inspection report, the Purchaser shall determine how the Seller shall proceed
with respect to the Mortgaged Property.
In
the
event that a Mortgage Loan becomes part of a REMIC, and becomes REO Property,
such property shall be disposed of by the Seller, with the consent of the
Purchaser as required pursuant to this Agreement, within three (3) years
after
becoming an REO Property, unless the Seller provides to the trustee under
such
REMIC an opinion of counsel to the effect that the holding of such REO
Property
subsequent to three years after its becoming REO Property, will not result
in
the imposition of taxes on “prohibited transactions” as defined in Section 860F
of the Code, or cause the transaction to fail to qualify as a REMIC at
any time
that certificates are outstanding. The Seller shall manage, conserve, protect
and operate each such REO Property for the certificateholders solely for
the
purpose of its prompt disposition and sale in a manner which does not cause
such
property to fail to qualify as “foreclosure property” within the meaning of
Section 860G(a)(8) of the Code, or any “net income from foreclosure property”
which is subject to taxation under the REMIC provisions of the Code. Pursuant
to
its efforts to sell such property, the Seller shall either itself or through
an
agent selected by the Seller, protect and conserve such property in the
same
manner and to such an extent as is customary in the locality where such
property
is located. Additionally, the Seller shall provide the Purchaser or any
master
servicer with information sufficient to perform the tax withholding and
reporting related to Sections 1445 and 6050J of the Code.
SECTION
5.04 Establishment
of Custodial Accounts; Deposits in Custodial Accounts.
The
Seller shall segregate and hold all funds collected and received pursuant
to
each Mortgage Loan separate and apart from any of its own funds and general
assets and shall establish and maintain one or more Custodial Accounts.
Each
Custodial Account shall be an Eligible Account. Funds deposited in a Custodial
Account may be drawn on in accordance with Section 4.05. The creation of
any
Custodial Account shall be evidenced by a letter agreement in the form
shown in
Exhibit
B
hereto.
The original of such letter agreement shall be furnished to the Purchaser
on the
initial Closing Date, and upon the request of any subsequent
purchaser.
The
Seller shall deposit in the Custodial Account on a daily basis, within
two (2)
Business Days of receipt thereof, and retain therein the following payments
and
collections received or made by it subsequent to the Cut-off Date, or received
by it prior to the Cut-off Date but allocable to a period subsequent thereto,
other than in respect of principal and interest on the Mortgage Loans due
on or
before the Cut-off Date:
(i) all
payments on account of principal, including Principal Prepayments, on the
Mortgage Loans;
(ii) all
payments on account of interest on the Mortgage Loans adjusted to the Mortgage
Loan Remittance Rate;
(iii) all
Liquidation Proceeds;
(iv) any
amounts required to be deposited by the Seller in connection with any REO
Property pursuant to Section 4.13;
(v) all
Insurance Proceeds including amounts required to be deposited pursuant
to
Sections 4.08, 4.10 and 4.11, other than proceeds to be held in the Escrow
Account and applied to the restoration or repair of the Mortgaged Property
or
released to the Mortgagor in accordance with Accepted Servicing Practices,
the
loan documents or applicable law;
(vi) all
Condemnation Proceeds affecting any Mortgaged Property which are not released
to
the Mortgagor in accordance with the Seller’s normal servicing procedures, the
loan documents or applicable law;
(vii) any
Monthly Advances;
(viii) Compensating
Interest, if any, for the month of distribution. Such deposit shall be
made from
the Seller’s own funds, without reimbursement therefor;
(ix) all
proceeds of any Mortgage Loan repurchased in accordance with Sections
3.03;
(x) any
amounts required to be deposited by the Seller pursuant to Section 4.11
in
connection with the deductible clause in any blanket hazard insurance policy,
such deposit shall be made from the Seller’s own funds, without reimbursement
therefor; and
(xi) any
amounts required to be deposited in the Custodial Account pursuant to Section
4.01 or Section 6.02.
The
foregoing requirements for deposit in the Custodial 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, assumption fees
and
other ancillary fees, to the extent permitted by Section 6.01, need not
be
deposited by the Seller in the Custodial Account.
The
Seller may invest the funds in the Custodial Account in Eligible Investments
designated in the name of the Seller for the benefit of the Seller, which
shall
mature not later than the Business Day next preceding the Remittance Date
next
following the date of such investment (except that (A) any investment in
the
Eligible Institution with which the Custodial Account is maintained may
mature
on such Remittance Date and (B) any other investment may mature on such
Remittance Date if the Seller shall advance funds on such Remittance Date,
pending receipt thereof to the extent necessary to make distributions to
the
Purchaser) and shall not be sold or disposed of prior to maturity.
Notwithstanding anything to the contrary herein and above, all income and
gain
realized from any such investment shall be for the benefit of the Seller
and
shall be subject to withdrawal by the Seller from the Custodial Account
pursuant
to Section 4.05(iv). The amount of any losses incurred in respect of any
such
investments shall be deposited in the Custodial Account by the Seller out
of its
own funds immediately as realized.
SECTION
5.05 Permitted
Withdrawals From the Custodial Account.
The
Seller may, from time to time, withdraw from the Custodial Account for
the
following purposes:
(i) to
make
payments to the Purchaser in the amounts and in the manner provided for
in
Section 5.01;
(ii) to
reimburse itself for Monthly Advances, the Seller’s right to reimburse itself
pursuant to this subclause (ii) being limited to amounts received on the
related
Mortgage Loan which represent late collections (net of the related Servicing
Fee) of principal and/or interest respecting which any such advance was
made, it
being understood that, in the case of such reimbursement, the Seller’s right
thereto shall be prior to the rights of the Purchaser, except that, where
the
Seller is required to repurchase a Mortgage Loan, pursuant to Section 3.03,
the
Seller’s right to such reimbursement shall be subsequent to the payment to the
Purchaser of the Repurchase Price pursuant to such Section and all other
amounts
required to be paid to the Purchaser with respect to such Mortgage
Loan;
(iii) to
reimburse itself for unreimbursed Servicing Advances and any unpaid Servicing
Fees, the Seller’s right to reimburse itself pursuant to this subclause (iii)
with respect to any Mortgage Loan being limited to related proceeds from
Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds and REO
Disposition Proceeds;
(iv) to
pay to
itself as part of its servicing compensation: (a) any interest earned on
funds
or any investment earnings in the Custodial Account net of any losses on
such
investments (all such amounts to be withdrawn monthly not later than each
Remittance Date), and (b) to the extent not otherwise retained, the Servicing
Fee from that portion of any payment or recovery as to interest with respect
to
a particular Mortgage Loan;
(v) to
pay to
itself with respect to each Mortgage Loan that has been repurchased pursuant
to
Section 3.03 all amounts received thereon and not distributed as of the
date on
which the related Repurchase Price is determined;
(vi) to
reimburse itself for unreimbursed Monthly Advances and Servicing Advances
to the
extent not fully reimbursed pursuant to Section 4.05(ii) or (iii)
above;
(vii) to
transfer funds to another Eligible Account in accordance with Section 4.09
hereof;
(viii) to
remove
funds inadvertently placed in the Custodial Account by the Seller or for
which
amounts previously deposited are returned unpaid by the related Mortgagor’s
banking institution; and
(ix) to
clear
and terminate the Custodial Account upon the termination of this
Agreement.
SECTION
5.06 Establishment
of Escrow Accounts; Deposits in Accounts.
The
Seller shall segregate and hold all funds collected and received pursuant
to
each Mortgage Loan which constitute Escrow Payments separate and apart
from any
of its own funds and general assets and shall establish and maintain one
or more
Escrow Accounts. Each Escrow Account shall be an Eligible Account. Funds
deposited in the Escrow Account may be drawn on by the Seller in accordance
with
Section 4.07. The creation of any Escrow Account shall be evidenced by
a letter
agreement in the form shown in Exhibit
C.
The
original of such letter agreement shall be furnished to the Purchaser on
the
initial Closing Date, and upon request to any subsequent purchaser.
The
Seller shall deposit in the Escrow Account or Accounts on a daily basis,
within
two (2) Business Days of receipt thereof, and retain therein:
(i) all
Escrow Payments collected on account of the Mortgage Loans, for the purpose
of
effecting timely payment of any such items as required under the terms
of this
Agreement;
(ii) all
Insurance Proceeds which are to be applied to the restoration or repair
of any
Mortgaged Property; and
(iii) all
Servicing Advances for Mortgagors whose Escrow Payments are insufficient
to
cover escrow disbursements.
The
Seller shall make withdrawals from the Escrow Account only to effect such
payments as are required under this Agreement, and for such other purposes
as
shall be as set forth or in accordance with Section 4.07. The Seller shall
be
entitled to retain any interest paid on funds deposited in an Escrow Account
by
the depository institution other than interest on escrowed funds required
by law
to be paid to the Mortgagor and, to the extent required by law, the Seller
shall
pay interest on escrowed funds to the Mortgagor notwithstanding that such
Escrow
Account is non-interest bearing or that interest paid thereon is insufficient
for such purposes.
SECTION
5.07 Permitted
Withdrawals From the Escrow Account.
Withdrawals
from the Escrow Account may be made by the Seller only:
(i) to
effect
timely payments of ground rents, taxes, assessments, water rates, Primary
Mortgage Insurance Policy premiums, if applicable, fire and hazard insurance
premiums, condominium assessments and comparable items for the related
Mortgage;
(ii) to
reimburse the Seller for any Servicing Advance made by the Seller with
respect
to a related Mortgage Loan but only from amounts received on the related
Mortgage Loan which represent late payments or collections of Escrow Payments
thereunder;
(iii) to
refund
to the Mortgagor any funds as may be determined to be overages;
(iv) for
transfer to the Custodial Account in accordance with the terms of this
Agreement;
(v) for
application to restoration or repair of the Mortgaged Property;
(vi) to
pay to
the Seller, or to the Mortgagor to the extent required by law, any interest
paid
on the funds deposited in the Escrow Account;
(vii) to
clear
and terminate the Escrow Account on the termination of this
Agreement;
(viii) to
pay to
the Mortgagors or other parties Insurance Proceeds deposited in accordance
with
Section 4.06;
(ix) to
remove
funds inadvertently placed in the Escrow Account by the Seller or for which
amounts previously deposited are returned unpaid by the related Mortgagor’s
banking institution; and
(x) to
clear
and terminate the Escrow Account upon the termination of this
Agreement.
SECTION
5.08 Payment
of Taxes, Insurance and Charges; Maintenance of Primary Mortgage Insurance;
Collections Thereunder.
With
respect to each Mortgage Loan, the Seller shall maintain accurate records
reflecting the status of ground rents, taxes, assessments, water rates
and other
charges which are or may become a lien upon the Mortgaged Property and
the
status of primary mortgage insurance premiums (if any) and fire and hazard
insurance coverage and shall obtain, from time to time, all bills for the
payment of such charges, including renewal premiums and shall effect payment
thereof prior to the applicable penalty or termination date and at a time
appropriate for securing maximum discounts allowable, employing for such
purpose
deposits of the Mortgagor in the Escrow Account which shall have been estimated
and accumulated by the Seller in amounts sufficient for such purposes,
as
allowed under the terms of the Mortgage or applicable law. To the extent
that
the Mortgage does not provide for Escrow Payments, the Seller shall determine
that any such payments are made by the Mortgagor at the time they first
become
due. The Seller assumes full responsibility for the timely payment of all
such
bills and shall effect timely 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 subject to its ability to recover such Servicing Advances pursuant
to
Sections 4.05(ii), (iii) and (vi). Notwithstanding the foregoing, if the
Seller
reasonably determines that any such Servicing Advance would not be recoverable
from amounts collected on the related Mortgage Loan, the Seller shall have
no
obligation to make such Servicing Advance. Any such determination shall
be
evidenced by an Officer’s Certificate delivered to the Purchaser indicating the
reasons therefor.
The
Seller will maintain in full force and effect Primary Mortgage Insurance
Policies issued by a Qualified Insurer with respect to each first lien
Mortgage
Loan for which such coverage is herein required. Such coverage will be
maintained until the Loan-to-Value ratio of the related Mortgage Loan is
reduced
to the amount for which Xxxxxx Xxx no longer requires such insurance to
be
maintained. The Seller will not cancel or refuse to renew any Primary Mortgage
Insurance Policy in effect on the related Closing Date that is required
to be
kept in force under this Agreement unless a replacement Primary Mortgage
Insurance Policy for such canceled or non-renewed policy is obtained from
and
maintained with a Qualified Insurer. The Seller shall not take any action
which
would result in non-coverage under any applicable Primary Mortgage Insurance
Policy of any loss which, but for the actions of the Seller would have
been
covered thereunder. In connection with any assumption or substitution agreement
entered into or to be entered into pursuant to Section 6.01, the Seller
shall
promptly notify the insurer under the related Primary Mortgage Insurance
Policy,
if any, of such assumption or substitution of liability in accordance with
the
terms of such policy and shall take all actions which may be required by
such
insurer as a condition to the continuation of coverage under the Primary
Mortgage Insurance Policy. If such Primary Mortgage Insurance Policy is
terminated as a result of such assumption or substitution of liability,
the
Seller shall obtain a replacement Primary Mortgage Insurance Policy as
provided
above.
In
connection with its activities as servicer, the Seller agrees to prepare
and
present, on behalf of itself and the Purchaser, claims to the insurer under
any
Primary Mortgage Insurance Policy in a timely fashion in accordance with
the
terms of such Primary Mortgage Insurance Policy and, in this regard, to
take
such action as shall be necessary to permit recovery under any Primary
Mortgage
Insurance Policy respecting a defaulted first lien Mortgage Loan. Pursuant
to
Section 4.04, any amounts collected by the Seller under any Primary Mortgage
Insurance Policy shall be deposited in the Custodial Account, subject to
withdrawal pursuant to Section 4.05.
SECTION
5.09 Transfer
of Accounts.
The
Seller may transfer a Custodial Account or an Escrow Account to a different
Eligible Account from time to time. Such transfer shall be made only upon
providing notice of the transfer to the Purchaser.
SECTION
5.10 Maintenance
of Hazard Insurance.
The
Seller shall cause to be maintained for each Mortgage Loan fire and hazard
insurance with extended coverage as is acceptable to Xxxxxx Mae or Xxxxxxx
Mac
and customary in the area where the Mortgaged Property is located in an
amount
which is equal to the lesser of (i) the maximum insurable value of the
improvements securing such Mortgage Loan and (ii) the greater of (a) the
outstanding principal balance of the Mortgage Loan, and (b) an amount such
that
the proceeds thereof shall be sufficient to prevent the Mortgagor and/or
the
mortgagee from becoming a co-insurer. If required by the Flood Disaster
Protection Act of 1973, as amended, each Mortgage Loan shall be covered
by a
flood insurance policy meeting the requirements of the current guidelines
of the
Federal Insurance Administration in effect with an insurance carrier acceptable
to Xxxxxx Mae or Xxxxxxx Mac, in an amount representing coverage not less
than
the least of (i) the outstanding principal balance of the Mortgage Loan,
(ii)
the maximum insurable value of the improvements securing such Mortgage
Loan and
(iii) 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 Seller determines in accordance with applicable
law and
pursuant to the Xxxxxx Mae 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 Seller shall notify the related Mortgagor that the
Mortgagor must obtain such flood insurance coverage, and if the related
Mortgagor fails to obtain the required flood insurance coverage within
forty-five (45) days after such notification, the Seller shall immediately
force
place the required flood insurance on the Mortgagor’s behalf. To the extent the
payment of the related premiums will not, in the Seller’s reasonable
determination, constitute non-recoverable Servicing Advances, the Seller
shall
also maintain on each REO Property, fire and hazard insurance with extended
coverage in an amount which is at least equal to the maximum insurable
value of
the improvements which are a part of such property, and, to the extent
required
and available under the Flood Disaster Protection Act of 1973, as amended,
flood
insurance in an amount as provided above. Any amounts collected by the
Seller
under any such policies other than amounts to be deposited in the Escrow
Account
and applied to the restoration or repair of the Mortgaged Property or REO
Property, or released to the Mortgagor in accordance with Accepted Servicing
Practices, shall be deposited in the Custodial Account, subject to withdrawal
pursuant to Section 4.05. It is understood and agreed that no other additional
insurance need be required by the Seller or maintained on property acquired
in
respect of the Mortgage Loan, other than pursuant to this Agreement, the
Xxxxxx
Xxx Guides or such applicable state or federal laws and regulations as
shall at
any time be in force and as shall require such additional insurance. All
such
policies shall be endorsed with standard mortgagee clauses with loss payable
to
the Seller and its successors and/or assigns and shall provide for at least
thirty (30) days prior written notice of any cancellation, reduction in
the
amount or material change in coverage to the Seller. The Seller shall not
interfere with the Mortgagor’s freedom of choice in selecting either his
insurance carrier or agent, provided,
however,
that
the Seller shall not accept any such insurance policies from insurance
companies
unless such companies are Qualified Insurers.
SECTION
5.11 Maintenance
of Mortgage Impairment Insurance Policy.
In
the
event that the Seller (or an affiliate of the Seller) shall obtain and
maintain
a blanket policy issued by an issuer acceptable to Xxxxxx Mae or Xxxxxxx
Mac
insuring against hazard losses on all of the Mortgage Loans, then, to the
extent
such policy provides coverage in an amount equal to the amount required
pursuant
to Section 4.10 and otherwise complies with all other requirements of Section
4.10, it shall conclusively be deemed to have satisfied its obligations
as set
forth in Section 4.10, it being understood and agreed that such policy
may
contain a deductible clause, in which case the Seller shall, in the event
that
there shall not have been maintained on the related Mortgaged Property
or REO
Property a policy complying with Section 4.10, and there shall have been
a loss
which would have been covered by such policy, deposit in the Custodial
Account
the amount not otherwise payable under the blanket policy because of such
deductible clause. In connection with its activities as servicer of the
Mortgage
Loans, the Seller agrees to prepare and present, on behalf of the Purchaser,
claims under any such blanket policy in a timely fashion in accordance
with the
terms of such policy. Upon request of the Purchaser, the Seller shall cause
to
be delivered to the Purchaser a certified true copy of such policy and
shall use
commercially reasonable efforts to obtain a statement from the insurer
thereunder that such policy shall in no event be terminated or materially
modified without thirty (30) days’ prior written notice to the
Purchaser.
SECTION
5.12 Maintenance
of Fidelity Bond and Errors and Omissions Insurance.
The
Seller shall maintain, at its own expense, a blanket Fidelity Bond and
an errors
and omissions insurance policy, with broad coverage with responsible companies
on all officers, employees or other persons acting in any capacity with
regard
to the Mortgage Loans to handle funds, money, documents and papers relating
to
the Mortgage Loans. The Fidelity Bond shall be in the form of a mortgage
banker’s blanket bond and shall protect and insure the Seller against losses,
including forgery, theft, embezzlement and fraud of such persons. The errors
and
omissions insurance shall protect and insure the Seller against losses
arising
out of errors and omissions and negligent acts of such persons. Such errors
and
omissions insurance shall also protect and insure the Seller against losses
in
connection with the failure to maintain any insurance policies required
pursuant
to this Agreement and the release or satisfaction of a Mortgage Loan without
having obtained payment in full of the indebtedness secured thereby. No
provision of this Section 4.12 requiring the Fidelity Bond or errors and
omissions insurance shall diminish or relieve the Seller from its duties
and
obligations as set forth in this Agreement. The minimum coverage under
any such
bond and insurance policy shall be at least equal to the corresponding
amounts
required by Xxxxxx Mae in the Xxxxxx Xxx Guides or by Xxxxxxx Mac in the
Xxxxxxx
Mac Guides. The Seller shall deliver to the Purchaser a certificate from
the
surety and the insurer as to the existence of the Fidelity Bond and errors
and
omissions insurance policy and shall obtain a statement from the surety
and the
insurer that such Fidelity Bond or insurance policy shall in no event be
terminated or materially modified without thirty (30) days’ prior written notice
to the Purchaser. Upon request by the Purchaser, the Seller shall provide
the
Purchaser with an insurance certificate certifying coverage under this
Section
4.12, and will provide an update to such certificate upon request, or upon
renewal or material modification of coverage.
SECTION
5.13 Title,
Management and Disposition of REO Property.
In
the
event that title to the Mortgaged Property is acquired in foreclosure,
by deed
in lieu of foreclosure or other method resulting in full or partial satisfaction
of the related Mortgage, the deed or certificate of sale shall be taken
in the
name of the Purchaser or its designee, or in the event the Purchaser or
its
designee is not authorized or permitted to hold title to real property
in the
state where the REO Property is located, or would be adversely affected
under
the “doing business” or tax laws of such state by so holding title, the deed or
certificate of sale shall be taken in the name of such Person or Persons
as
shall be consistent with an Opinion of Counsel obtained by the Seller,
at the
expense of the Purchaser, from an attorney duly licensed to practice law
in the
state where the REO Property is located. Any Person or Persons holding
such
title other than the Purchaser shall acknowledge in writing that such title
is
being held as nominee for the benefit of the Purchaser.
The
Seller shall notify the Purchaser in accordance with the Xxxxxx Mae Guides
of
each acquisition of REO Property upon such acquisition, and thereafter
assume
the responsibility for marketing such REO Property in accordance with Accepted
Servicing Practices. Thereafter, the Seller shall continue to provide certain
administrative services to the Purchaser relating to such REO Property
as set
forth in this Section 4.13.
The
Seller shall, either itself or through an agent selected by the Seller,
and in
accordance with the Xxxxxx Xxx Guides manage, conserve, protect and operate
each
REO Property in the same manner that it manages, conserves, protects and
operates other foreclosed property for its own account, and in the same
manner
that similar property in the same locality as the REO Property is managed.
The
Seller shall cause each REO Property to be inspected promptly upon the
acquisition of title thereto and shall cause each REO Property to be inspected
at least annually thereafter or more frequently as required by the
circumstances. The Seller shall make or cause to be made a written report
of
each such inspection. Such reports shall be retained in the Servicing
File.
The
Seller shall use its best efforts to dispose of the REO Property as soon
as
possible and shall sell such REO Property in any event within three (3)
years
after title has been taken to such REO Property, unless the Seller determines,
and gives an appropriate notice to the Purchaser to such effect, that a
longer
period is necessary for the orderly liquidation of such REO Property. If
a
longer period than three (3) years is permitted under the foregoing sentence
and
is necessary to sell any REO Property, the Seller shall report monthly
to the
Purchaser as to the progress being made in selling such REO Property. If
as of
the date title to any REO Property was acquired by the Seller there were
outstanding unreimbursed Servicing Advances with respect to the REO Property,
the Seller shall be entitled to immediate reimbursement from the Purchaser
for
any related unreimbursed Servicing Advances. The disposition of REO Property
shall be carried out by the Seller at such price, and upon such terms and
conditions, as the Seller deems to be in the best interests of the Purchaser.
The Seller shall update the Purchaser from time-to-time as to the status
of each
REO Property.
SECTION
5.14 Notification
of Maturity Date.
With
respect to each Mortgage Loan, the Seller shall execute and deliver to
the
Mortgagor any and all necessary notices required under applicable law and
the
terms of the related Mortgage Note and Mortgage regarding the maturity
date if
required under applicable law.
ARTICLE
VI
PAYMENTS
TO THE PURCHASER
SECTION
6.01 Distributions.
On
each
Remittance Date, the Seller shall distribute by wire transfer to the Purchaser
(i) all amounts credited to the Custodial Account as of the close of business
on
the preceding Determination Date, net of charges against or withdrawals
from the
Custodial Account pursuant to Section 4.05, plus (ii) all Monthly Advances,
if
any, which the Seller is obligated to distribute pursuant to Section 5.03,
plus
(iii) all payments in respect of Compensating Interest for such Remittance
Date
required to be deposited in the Custodial Account pursuant to Section
4.04(viii), minus (iv) any amounts attributable to Monthly Payments
collected but due on a Due Date or Dates subsequent to the preceding
Determination Date, which amounts shall be remitted on the Remittance Date
next
succeeding the Due Period for such amounts, and any Principal Prepayments
received during the month of such Remittance Date, which amounts shall
be
remitted on the next succeeding Remittance Date.
With
respect to any remittance received by the Purchaser after the Business
Day
following the Business Day on which such payment was due, the Seller shall
pay
to the Purchaser interest on any such late payment at an annual rate equal
to
the Prime Rate, adjusted as of the date of each change, plus two percentage
points, but in no event greater than the maximum amount permitted by applicable
law. Such interest shall be deposited in the Custodial Account by the Seller
on
the date such late payment is made and shall cover the period commencing
with
the day following the second Business Day on which such payment was due
and
ending with the Business Day on which such payment is made, both inclusive.
Such
interest shall be remitted along with the distribution payable on the next
succeeding Remittance Date. The payment by the Seller of any such interest
shall
not be deemed an extension of time for payment or a waiver of any Event
of
Default by the Seller.
SECTION
6.02 Statements
to the Purchaser.
The
Seller shall furnish to the Purchaser an individual loan accounting report,
as
of the last Business Day of each month, in the Seller’s assigned loan number
order to document Mortgage Loan payment activity on an individual Mortgage
Loan
basis. With respect to each month, the corresponding individual loan accounting
report shall be received by the Purchaser no later than the fifth (5th)
Business
Day of the following month in a format mutually agreed upon by both the
Purchaser and the Seller and in hard copy, which report shall contain the
following (or such other information as is mutually agreed upon by the
Seller
and the Purchaser):
(i) with
respect to each Monthly Payment, the amount of such remittance allocable
to
principal (including a separate breakdown of any Principal Prepayment and
a
detailed report of interest on principal prepayment amounts remitted in
accordance with Section 4.04);
(ii) with
respect to each Monthly Payment, the amount of such remittance allocable
to
interest;
(iii) the
aggregate Scheduled Principal Balance of the Mortgage Loans;
(iv) the
aggregate of any expenses reimbursed to the Seller during the prior distribution
period pursuant to Section 4.05;
(v) the
number and aggregate outstanding principal balances of Mortgage Loans (a)
delinquent (1) 30 to 59 days, (2) 60 to 89 days, and (3) 90 days or more;
(b) as
to which foreclosure has commenced; and (c) as to which REO Property has
been
acquired; and
(vi) the
amount of any Monthly Advances.
The
Seller shall also provide a monthly servicing report, sorted in the Purchaser’s
assigned loan number order, in the form of Alltel reports P139, S214, S215
and
S50Y and Fidelity report P-4DL (or in such other forms as the Purchaser
and the
Seller may agree), with each such report.
The
Seller shall prepare and file any and all information statements or other
filings required to be delivered to any governmental taxing authority or
to the
Purchaser pursuant to any applicable law with respect to the Mortgage Loans
and
the transactions contemplated hereby. In addition, the Seller shall provide
the
Purchaser with such information concerning the Mortgage Loans as is necessary
for the Purchaser to prepare its federal income tax return as the Purchaser
may
reasonably request from time to time.
In
addition, not more than sixty (60) days after the end of each calendar
year, the
Seller shall furnish to each Person who was a Purchaser at any time during
such
calendar year an annual statement in accordance with the requirements of
applicable federal income tax law as to the aggregate of remittances for
the
applicable portion of such year.
SECTION
6.03 Monthly
Advances by the Seller.
Not
later
than the close of business on the Business Day preceding each Remittance
Date,
the Seller shall deposit in the Custodial Account an amount equal to all
Monthly
Payments, whether or not deferred pursuant to Section 4.01, which were
due on a
Mortgage Loan on the immediately preceding Due Date and delinquent at the
close
of business on the related Determination Date.
The
Seller’s obligation to make such Monthly Advances as to any Mortgage Loan will
continue through the earlier of: (i) the date of the termination or resignation,
as applicable, of the Seller pursuant to Section 7.04, 8.01 or 9.01 or
(ii) the
date of final disposition and liquidation of the related Mortgage Loan
or any
Mortgaged Property acquired through foreclosure or a conveyance in lieu
of
foreclosure, unless the Seller reasonably believes such advance to be
non-recoverable from proceeds of the related Mortgage Loan. In such event,
the
Seller shall deliver to the Purchaser an Officer’s Certificate of the Seller to
the effect that an officer of the Seller has reviewed the related Servicing
File
and has made the reasonable determination that any additional advances
are
non-recoverable from proceeds of the related Mortgage Loan.
SECTION
6.04 Liquidation
Reports.
Upon
the
foreclosure sale of any Mortgaged Property or the acquisition thereof by
the
Purchaser pursuant to a deed in lieu of foreclosure, the Seller shall submit
to
the Purchaser a liquidation report with respect to such Mortgaged Property.
The
Seller shall also provide reports on the status of REO Property containing
such
information as the Purchaser may reasonably require.
ARTICLE
VII
GENERAL
SERVICING PROCEDURES
SECTION
7.01 Assumption
Agreements.
The
Seller shall, to the extent it has knowledge of any conveyance or prospective
conveyance by any Mortgagor of the Mortgaged Property (whether by absolute
conveyance or by contract of sale, and whether or not the Mortgagor remains
or
is to remain liable under the Mortgage Note and/or the Mortgage), exercise
its
rights to accelerate the maturity of such Mortgage Loan under any “due-on-sale”
clause to the extent permitted by law; provided,
however,
that
the Seller shall not exercise any such rights if prohibited by law or the
terms
of the Mortgage Note from doing so or if the exercise of such rights would
impair or threaten to impair any recovery under the related Primary Mortgage
Insurance Policy, if any. If the Seller reasonably believes it is unable
under
applicable law to enforce such “due-on-sale” clause, the Seller will enter into
an assumption agreement with the person to whom the Mortgaged Property
has been
conveyed or is proposed to be conveyed, pursuant to which such person becomes
liable under the Mortgage Note and, to the extent permitted by applicable
state
law, the Mortgagor remains liable thereon. If the Seller is prohibited
under
applicable law from (a) entering into an assumption agreement with the
Person to
whom the Mortgaged Property has been conveyed or is proposed to be conveyed
or
(b) requiring the original Mortgagor to remain liable under the Mortgage
Note,
the Seller, with the prior consent of the primary mortgage insurer, if
any, is
authorized to enter into a substitution of liability agreement with the
person
to whom the Mortgaged Property has been conveyed or is proposed to be conveyed
pursuant to which the original Mortgagor is released from liability and
such
Person is substituted as mortgagor and becomes liable under the related
Mortgage
Note. Any such substitution of liability agreement shall be in lieu of
an
assumption agreement.
In
connection with any such assumption or substitution of liability, the Seller
shall follow the underwriting practices and procedures of the Xxxxxx Mae
Guides.
With respect to an assumption or substitution of liability, the Mortgage
Interest Rate borne by the related Mortgage Note and the amount of the
Monthly
Payment may not be changed. If the credit of the proposed transferee does
not
meet such underwriting criteria, the Seller diligently shall, to the extent
permitted by the Mortgage or the Mortgage Note and by applicable law, accelerate
the maturity of the Mortgage Loan. The Seller shall notify the Purchaser
that
any such substitution of liability or assumption agreement has been completed
by
forwarding to the Purchaser the original of any such substitution of liability
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. All fees collected by the Seller for entering into an assumption
or
substitution of liability agreement shall belong to the Seller as additional
servicing compensation.
Notwithstanding
the foregoing paragraphs of this Section or any other provision of this
Agreement, the Seller shall not be deemed to be in default, breach or any
other
violation of its obligations hereunder by reason of any assumption of a
Mortgage
Loan by operation of law or any assumption which the Seller may be restricted
by
law from preventing, for any reason whatsoever. For purposes of this Section
6.01, 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
7.02 Satisfaction
of Mortgages and Release of Mortgage Files.
Upon
the
payment in full of any Mortgage Loan, or the receipt by the Seller of a
notification that payment in full will be escrowed in a manner customary
for
such purposes, the Seller will immediately notify the Purchaser by a
certification, which certification shall include a statement to the effect
that
all amounts received or to be received in connection with such payment
which are
required to be deposited in the Custodial Account pursuant to Section 4.04
have
been or will be so deposited, of a Servicing Officer and shall request
delivery
to it of the portion of the Mortgage File held by the Purchaser. The Purchaser
shall no later than five (5) Business Days after receipt of such certification
and request, release or cause to be released to the Seller, the related
Mortgage
Loan Documents and, upon its receipt of such documents, the Seller shall
promptly prepare and deliver to the Purchaser the requisite satisfaction
or
release. No later than three (3) Business Days following its receipt of
such
satisfaction or release, the Purchaser shall deliver, or cause to be delivered,
to the Seller the release or satisfaction properly executed by the owner
of
record of the applicable Mortgage or its duly appointed attorney in fact.
If
such Mortgage Loan is a MERS Mortgage Loan, the Seller is authorized to
cause
the removal from the registration on the MERS System of such Mortgage and
to
execute and deliver, on behalf of the Purchaser, any and all instruments
of
satisfaction or cancellation or of partial or full release.
In
the
event the Seller satisfies or releases a Mortgage without having obtained
payment in full of the indebtedness secured by the Mortgage or should it
otherwise prejudice any right the Purchaser may have under the Mortgage
Loan
Documents, the Seller, upon written demand, shall remit within ten (10)
Business
Days to the Purchaser the then outstanding principal balance of the related
Mortgage Loan by deposit thereof in the Custodial Account.
From
time
to time and as appropriate for the servicing or foreclosure of the Mortgage
Loans, including for the purpose of collection under any Primary Mortgage
Insurance Policy, the Purchaser shall, upon request of the Seller and delivery
to the Purchaser of a servicing receipt signed by a Servicing Officer,
release
the portion of the Mortgage File held by the Purchaser to the Seller. Such
servicing receipt shall obligate the Seller to return such Mortgage Loan
Documents to the Purchaser when the need therefor by the Seller no longer
exists, unless the Mortgage Loan has been liquidated and the Liquidation
Proceeds relating to the Mortgage Loan have been deposited in the Custodial
Account or the Mortgage File 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 Seller
has
delivered to the Purchaser a certificate of a Servicing Officer certifying
as to
the name and address of the Person to which such Mortgage File 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, the servicing
receipt shall be released by the Purchaser to the Seller.
SECTION
7.03 Servicing
Compensation.
As
compensation for its services hereunder, the Seller shall be entitled to
the
Servicing Fee. Additional servicing compensation in the form of assumption
fees,
as provided in Section 6.01, late payment charges, interest and investment
earning on funds on deposit in the Custodial Account and Escrow Account
(to the
extent provided for herein) and other ancillary income shall be retained
by the
Seller to the extent not required to be deposited in the Custodial Account.
The
Seller shall be required to pay all expenses incurred by it in connection
with
its servicing activities hereunder and shall not be entitled to reimbursement
therefor except as specifically provided for herein.
SECTION
7.04 Annual
Statement as to Compliance.
To
the
extent that any Mortgage Loans are serviced pursuant to this Agreement
and are
not part of a Pass-Through Transfer, within seventy-five (75) days after
the end
of each calendar year, the Seller will deliver to the Purchaser an Officers’
Certificate stating, as to each signatory thereof, that (i) a review of
the
activities of the Seller during the preceding calendar year and of performance
under this Agreement has been made under such officers’ supervision, and (ii) to
the best of such officers’ knowledge, based on such review, the Seller has
fulfilled all of its obligations under this Agreement throughout such year,
or,
if there has been a default in the fulfillment of any such obligation,
specifying each such default known to such officers and the nature and
status
thereof. The first Officer’s Certificate delivered by the Seller to the
Purchaser pursuant to this Section shall be delivered on or before March
15,
2007.
SECTION
7.05 Annual
Independent Certified Public Accountants’ Servicing Report.
To
the
extent that any Mortgage Loans are serviced pursuant to this Agreement
and are
not part of a Pass-Through Transfer, within seventy-five (75) days after
the end
of each calendar year, the Seller at its expense shall furnish to the Purchaser
each of the items described in Section 2.05 of the Regulation AB Compliance
Addendum. The first statement delivered by the Seller to the Purchaser
pursuant
to this Section shall be delivered on or before March 15, 2007.
SECTION
7.06 Purchaser’s
Right to Examine Seller Records.
At
its
expense, the Purchaser shall have the right to examine and audit upon reasonable
notice to the Seller, during business hours or at such other times as might
be
reasonable under applicable circumstances, any and all of the books, records,
documentation or other information of the Seller, or held by another for
the
Seller or on its behalf or otherwise, which relates to the performance
or
observance by the Seller of the terms, covenants or conditions of this
Agreement.
The
Seller shall provide to the Purchaser and any supervisory agents or examiners
representing a state or federal governmental agency having jurisdiction
over the
Purchaser, including but not limited to, OCC, OTS, FDIC and other similar
entities, access to any documentation regarding the Mortgage Loans in the
possession of the Seller which may be required by any applicable regulations.
Such access shall be afforded without charge, upon reasonable request,
during
normal business hours and at the offices of the Seller, and in accordance
with
the federal government, OCC, FDIC, OTS, or any other similar regulations;
provided, however, that in
connection with providing such access, the Seller shall not be required
to incur
any out-of-pocket costs unless provisions have been made for the reimbursement
thereof.
SECTION
7.07 Seller
Shall Provide Information as Reasonably Required.
The
Seller shall furnish to the Purchaser during the term of this Agreement
such
periodic, special or other reports, information or documentation as the
Purchaser may reasonably request, as shall be necessary, reasonable or
appropriate in respect to the Mortgage Loans and the performance of the
Seller
under this Agreement, including any reports, information or documentation
reasonably required to comply with any regulations regarding any supervisory
agents or examiners of the Purchaser; provided, that, the Seller shall
not be
liable for any out-of-pocket costs with respect to the provision of such
reports, information or documentation. All such reports or information
shall be
provided by and in accordance with such applicable instructions and directions
as the Purchaser may reasonably request in relation to this Agreement or
the
performance of the Seller under this Agreement. The Seller agrees to execute
and
deliver all such instruments and take all such action as the Purchaser,
from
time to time, may reasonably request in order to effectuate the purpose
and to
carry out the terms of this Agreement.
The
Seller, upon reasonable advance notice, shall make reasonably available
to the
Purchaser or any prospective purchaser a knowledgeable financial or accounting
officer for the purpose of answering questions and to permit any prospective
purchaser to inspect the Seller’s servicing facilities for the purpose of
satisfying such prospective purchaser that the Seller has the ability to
service
the Mortgage Loans as provided in this Agreement.
The
Seller shall maintain with respect to each Mortgage Loan and shall make
available for inspection by the Purchaser or its designee the related Servicing
File during the time the Purchaser retains ownership of a Mortgage Loan
and
thereafter in accordance with applicable laws and regulations.
ARTICLE
VIII
THE
SELLER
SECTION
8.01 Indemnification;
Third Party Claims.
The
Seller agrees to indemnify the Purchaser and hold it harmless against any
and
all claims, losses, damages, penalties, fines, forfeitures, legal fees
and
related costs, judgments, and any other costs, fees and expenses (collectively,
“Damages”)
that
the Purchaser may sustain in any way related to the failure of the Seller
to
observe and perform its duties, obligations, covenants, and agreements
and to
service the Mortgage Loans in compliance with the terms of this Agreement
or as
a result of the breach of a representation or warranty set forth in Sections
3.01 or 3.02 of this Agreement. The Seller hereunder shall immediately
notify
the Purchaser if a claim is made by a third party with respect to this
Agreement
or a Mortgage Loan, assume (with the consent of the Purchaser) the defense
of
any such claim and pay all expenses in connection therewith, including
counsel
fees, and promptly pay, discharge and satisfy any judgment or decree which
may
be entered against it or the Purchaser in respect of such claim. The Seller
shall follow any written instructions received from the Purchaser in connection
with such claim. The Purchaser shall promptly reimburse the Seller for
all
amounts advanced by it pursuant to the two preceding sentences except when
the
claim relates to the failure of the Seller to service and administer the
Mortgage Loans in compliance with the terms of this Agreement, the failure
of
the Seller to perform its duties and obligations pursuant to this Agreement,
the
breach of representation or warranty set forth in Sections 3.01 or 3.02,
or the
negligence, bad faith or willful misconduct of the Seller. The provisions
of
this Section 7.01 shall survive termination of this Agreement and transfer
of
the related servicing rights.
SECTION
8.02 Merger
or
Consolidation of the Seller.
The
Seller shall keep in full effect its existence, rights and franchises as
a
corporation under the laws of the state of its incorporation except as
permitted
herein, and shall obtain and preserve its qualification to do business
as a
foreign corporation in each jurisdiction in which such qualification is
or shall
be necessary to protect the validity and enforceability of this Agreement,
or
any of the Mortgage Loans and to perform its duties under this
Agreement.
Any
Person into which the Seller may be merged or consolidated (including by
means
of sale or disposal of all or substantially all of the Seller’s assets), or any
corporation resulting from any merger, conversion or consolidation to which
the
Seller shall be a party, or any Person succeeding to the business of the
Seller
(whether or not related to loan servicing), shall be the successor of the
Seller
hereunder, without the execution or filing of any paper or any further
act on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding; provided,
however,
that
the successor or surviving Person shall be an institution who is a Xxxxxx
Xxx or
Xxxxxxx Mac approved seller/servicer in good standing.
SECTION
8.03 Limitation
on Liability of the Seller and Others.
The
duties and obligations of the Seller shall be determined solely by the
express
provisions of this Agreement, the Seller shall not be liable except for
the
performance of such duties and obligations as are specifically set forth
in this
Agreement and no implied covenants or obligations shall be read into this
Agreement against the Seller. Neither the Seller nor any of the officers,
employees or agents of the Seller shall be under any liability to the Purchaser
for any action taken or for refraining from the taking of any action in
good
faith pursuant to this Agreement, or for errors in judgment made in good
faith;
provided,
however,
that
this provision shall not protect the Seller or any such person against
any
breach of warranties or representations made herein, or failure to perform
its
obligations in compliance with any standard of care set forth in this Agreement,
or any liability which would otherwise be imposed by reason of negligence,
bad
faith or willful misconduct, or any breach of the terms and conditions
of this
Agreement. The Seller and any officer, employee or agent of the Seller
may rely
in good faith on any document of any kind prima facie properly executed
and
submitted by the Purchaser respecting any matters arising hereunder. The
Seller
shall not be under any obligation to appear in, prosecute or defend any
legal
action which is not incidental to its duties to service the Mortgage Loans
in
accordance with this Agreement and which in its reasonable opinion may
involve
it in any expenses or liability; provided,
however,
that
the Seller may undertake any such action which it may deem necessary or
desirable in respect to this Agreement and the rights and duties of the
parties
hereto. In such event, the reasonable legal expenses and costs of such
action
and any liability resulting therefrom shall be expenses, costs and liabilities
for which the Purchaser will be liable, and the Seller shall be entitled
to be
reimbursed therefor from the Purchaser upon written demand.
SECTION
8.04 Seller
Not to Resign.
The
Seller shall not resign from the obligations and duties hereby imposed
on it
except by mutual consent of the Seller and the Purchaser or upon the
determination that its duties hereunder are no longer permissible under
applicable law and such incapacity cannot be cured by the Seller. Any such
determination permitting the resignation of the Seller shall be evidenced
by an
Opinion of Counsel to such effect delivered to the Purchaser which Opinion
of
Counsel shall be in form and substance acceptable to the Purchaser. No
such
resignation shall become effective until a successor shall have assumed
the
Seller’s responsibilities and obligations hereunder in the manner provided in
Section 11.01.
SECTION
8.05 No
Transfer of Servicing.
With
respect to the retention of the Seller to service the Mortgage Loans hereunder,
the Seller acknowledges that the Purchaser has acted in reliance upon the
Seller’s independent status, the adequacy of its servicing facilities, plan,
personnel, records and procedures, its integrity, reputation and financial
standing and the continuance thereof. Without in any way limiting the generality
of this Section 7.05 and except as pursuant to Section 7.02, the Seller
shall
not either assign this Agreement or the servicing hereunder or delegate
its
rights or duties hereunder or any portion thereof without the prior written
approval of the Purchaser. Notwithstanding the foregoing, the Seller may,
without the consent of the Purchaser, retain reasonable and necessary third
party contractors to perform certain servicing and loan administration
functions, including and limited to, hazard insurance administration, tax
payment and administration, flood certification and administration and
foreclosure activities; provided, that such contractors shall perform such
servicing and loan administrative functions in a manner consistent with
this
Agreement; provided, further, that the retention of such contractors by
Seller
shall not limit the obligation of the Seller to service the Mortgage Loans
pursuant to the terms and conditions of this Agreement or release it from
any of
its obligations hereunder.
ARTICLE
IX
DEFAULT
SECTION
9.01 Events
of
Default.
In
case
one or more of the following Events of Default by the Seller shall occur
and be
continuing, that is to say:
(i) any
failure by the Seller to remit to the Purchaser any payment required to
be made
under the terms of this Agreement which continues unremedied for a period
of two
(2) Business Days after the date upon which written notice of such failure,
requiring the same to be remedied, shall have been given to the Seller
by the
Purchaser; or
(ii) failure
on the part of the Seller duly to observe or perform in any material respect
any
other of the covenants or agreements on the part of the Seller set forth
in this
Agreement, including making any required Servicing Advances, or which failure
continues unremedied for a period of thirty (30) days after the date on
which
written notice of such failure, requiring the same to be remedied, shall
have
been given to the Seller by the Purchaser; or
(iii) a
decree
or order of a court or agency or supervisory authority having jurisdiction
for
the appointment of a conservator or receiver or liquidator in any insolvency,
bankruptcy, readjustment of debt, marshalling of assets and liabilities
or
similar proceedings, or for the winding-up or liquidation of its affairs,
shall
have been entered against the Seller and such decree or order shall have
remained in force undischarged or unstayed for a period of sixty (60) days;
or
(iv) the
Seller shall voluntarily go into liquidation, consent to the appointment
of a
conservator or receiver or liquidator in any insolvency, bankruptcy,
readjustment of debt, marshalling of assets and liabilities or similar
proceedings of or relating to the Seller or of or relating to all or
substantially all of its property; or
(v) the
Seller shall admit in writing its inability to pay its debts generally
as they
become due, file a petition to take advantage of any applicable insolvency
or
reorganization statute, make an assignment for the benefit of its creditors,
or
voluntarily suspend payment of its obligations; or
(vi) the
Seller ceases to be approved by Xxxxxx Xxx or Xxxxxxx Mac as a mortgage
loan
seller and servicer for more than thirty (30) days; or
(vii) the
Seller attempts to assign its right to servicing compensation hereunder
or the
Seller attempts, without the consent of the Purchaser, to assign this Agreement
or the servicing responsibilities hereunder or to delegate its duties hereunder
or any portion thereof in a manner not permitted under this Agreement;
or
(viii) the
Seller ceases to be (a) licensed to service first lien residential mortgage
loans in each jurisdiction in which a Mortgaged Property is located and
such
licensing is required, and (b) qualified to transact business in any
jurisdiction where it is currently so qualified, but only to the extent
such
non-qualification materially and adversely affects the Seller’s ability to
perform its obligations hereunder; or
(ix) failure
on the part of the Seller duly to observe or perform in any material respect
any
of the covenants or agreements on the part of the Seller set forth in the
Regulation AB Compliance Addendum;
then,
and
in each and every such case, so long as an Event of Default shall not have
been
remedied, the Purchaser, by notice in writing to the Seller may, in addition
to
whatever rights the Purchaser may have under Sections 3.03 and 7.01 and
at law
or equity or to damages, including injunctive relief and specific performance,
terminate all the rights and obligations of the Seller under this Agreement
and
in and to the Mortgage Loans and the proceeds thereof without compensating
the
Seller for the same. On or after the receipt by the Seller of such written
notice of termination, all authority and power of the Seller under this
Agreement, whether with respect to the Mortgage Loans or otherwise, shall
pass
to and be vested in the successor appointed pursuant to Section 12.01.
Upon
written request from the Purchaser, the Seller shall prepare, execute and
deliver, any and all documents and other instruments, place in such successor’s
possession all Servicing Files, and do or accomplish all other acts or
things
necessary or appropriate to effect the purposes of such notice of termination,
whether to complete the transfer and endorsement or assignment of the Mortgage
Loans and related documents, or otherwise, at the Seller’s sole expense. The
Seller agrees to cooperate with the Purchaser and such successor in effecting
the termination of the Seller’s responsibilities and rights hereunder,
including, without limitation, the transfer to such successor for administration
by it of all cash amounts which shall at the time be credited by the Seller
to
the Custodial Account or Escrow Account or thereafter received with respect
to
the Mortgage Loans or any REO Property.
If
any of
the Mortgage Loans are MERS Mortgage Loans, in connection with the termination
or resignation (as described in Section 8.04) of the Seller hereunder,
either
(i) the successor servicer shall represent and warrant that it is a member
of
MERS in good standing and shall agree to comply in all material respects
with
the rules and procedures of MERS in connection with the servicing of the
Mortgage Loans that are registered with MERS, or (ii) the Seller shall
cooperate
with the successor servicer either (x) in causing MERS to execute and deliver
an
assignment of Mortgage in recordable form to transfer the Mortgage from
MERS to
the Purchaser and to execute and deliver such other notices, documents
and other
instruments as may be necessary or desirable to effect a transfer of such
Mortgage Loan or servicing of such Mortgage Loan on the MERS® System to the
successor servicer or (y) in causing MERS to designate on the MERS® System the
successor servicer as the servicer of such Mortgage Loan.
SECTION
9.02 Waiver
of
Defaults.
The
Purchaser may waive only by written notice any default by the Seller in
the
performance of its obligations hereunder and its consequences. Upon any
such
waiver of a past default, such default shall cease to exist, and any Event
of
Default arising therefrom shall be deemed to have been remedied for every
purpose of this Agreement. No such waiver shall extend to any subsequent
or
other default or impair any right consequent thereon except to the extent
expressly so waived in writing.
ARTICLE
X
TERMINATION
SECTION
10.01 Termination.
The
respective obligations and responsibilities of the Seller shall terminate
upon:
(i) the later of the final payment or other liquidation (or any advance
with
respect thereto) of the last Mortgage Loan or the disposition of all REO
Property and the remittance of all funds due hereunder; (ii) by mutual
consent
of the Seller and the Purchaser in writing; or (iii) termination of the
Seller
by the Purchaser with cause under the terms of this Agreement.
ARTICLE
XI
RECONSTITUTION
OF MORTGAGE LOANS
SECTION
11.01 Reconstitution
of Mortgage Loans.
(a) The
Seller acknowledges and the Purchaser agrees that with respect to some
or all of
the Mortgage Loans, the Purchaser may effect, upon thirty (30) calendar
days
prior written notice to the Seller, either:
(i) one
or
more sales of the Mortgage Loans as whole loan transfers (each, a “Whole
Loan Transfer”);
(ii) one
or
more Agency Transfers; and/or
(iii) one
or
more sales of the Mortgage Loans as public or private pass-through transfers
(each, a “Pass-Through
Transfer”).
(b) With
respect to each Whole Loan Transfer, Agency Transfer or Pass-Through Transfer,
as the case may be, the Seller agrees:
(i) to
cooperate reasonably with the Purchaser and any prospective purchaser with
respect to all reasonable requests that do not result in an undue burden
or
expense of the Seller;
(ii) to
execute all agreements required to be executed by the Seller in connection
with
such Whole Loan Transfer, Agency Transfer or Pass-Through Transfer provided
that
any such agreements be consistent with the terms hereof and impose no greater
duties, liabilities or obligations upon the Seller than those set forth
herein
and provided that the Seller is given an opportunity to review and reasonably
negotiate in good faith the content of such documents not specifically
referenced or provided for herein;
(iii) to
make
all the representations and warranties set forth in Section 3.01 as of
the date
of the Whole Loan Transfer, Agency Transfer or Pass-Through
Transfer;
(iv) to
deliver to the Purchaser (a) for inclusion in any prospectus or other offering
material such publicly available information regarding the Seller and its
financial condition and any additional information reasonably requested
by the
Purchaser, (b) any similar nonpublic, unaudited financial information (which
the
Purchaser may, at its option and its cost, have audited by certified public
accountants) and such other information as is reasonably requested by the
Purchaser and which the Seller is capable of providing without unreasonable
effort or expense, and to indemnify the Purchaser and its affiliates for
any
losses, costs or damages incurred by any of them directly related to any
material misstatements contained in such information or for any omissions
of
material fact required to be stated therein to the extent such information
is
provided by the Seller specifically for use in a prospectus or other offering
material; provided,
that,
the
Purchaser shall indemnify the Seller and its affiliates for any losses,
costs or
damages related to any material misstatements contained in any prospectus
or
other offering material other than in such information provided by the
Seller
specifically for use therein or for any omissions of material fact required
to
be stated therein and (c) such statements and audit letters of reputable,
certified public accountants pertaining to information provided by the
Seller
pursuant to clause (a) above as shall be reasonably requested by the Purchaser;
and
(v) to
deliver to the Purchaser, and to any Person designated by the Purchaser,
opinions of counsel in a form reasonably acceptable to the Purchaser as
are
customarily delivered by sellers and servicers and reasonably determined
by the
Purchaser to be necessary in connection with Whole Loan Transfers, Agency
Transfers or Pass-Through Transfers, as the case may be, it being understood
that the cost of any opinions of counsel (other than in-house counsel)
that may
be required for a Whole Loan Transfer, Agency Transfer or Pass-Through
Transfer,
as the case may be, shall be the responsibility of the Purchaser.
The
Purchaser shall reimburse the Seller for any and all out-of-pocket expenses,
costs and fees, including reasonable attorney’s fees, incurred by the Seller in
response to requests for information or assistance under this Section.
All
Mortgage Loans not sold or transferred pursuant to a Whole Loan Transfer,
Agency
Transfer or Pass-Through Transfer shall be subject to this Agreement and
shall
continue to be serviced in accordance with the terms of this Agreement
and with
respect thereto this Agreement shall remain in full force and
effect.
ARTICLE
XII
MISCELLANEOUS
PROVISIONS
SECTION
12.01 Successor
to the Seller.
Prior
to
termination of Seller’s responsibilities and duties under this Agreement
pursuant to Section 7.04, 8.01 or 9.01, the Purchaser shall (i) succeed
to and
assume all of the Seller’s responsibilities, rights, duties and obligations
under this Agreement, or (ii) appoint a successor having the characteristics
set
forth in Section 7.02 hereof and which shall succeed to all rights and
assume
all of the responsibilities, duties and liabilities of the Seller under
this
Agreement. In connection with such appointment and assumption, the Purchaser
may
make such arrangements for the compensation of such successor out of payments
on
Mortgage Loans as the Purchaser and such successor shall agree. In the
event
that the Seller’s duties, responsibilities and liabilities under this Agreement
should be terminated pursuant to the aforementioned Sections, the Seller
shall
discharge such duties and responsibilities during the period from the date
it
acquires knowledge of such termination until the effective date thereof
with the
same degree of diligence and prudence which it is obligated to exercise
under
this Agreement, and shall take no action whatsoever that might impair or
prejudice the rights or financial condition of its successor. The resignation
or
removal of the Seller pursuant to the aforementioned Sections shall not
become
effective until a successor shall be appointed pursuant to this Section
and
shall in no event relieve the Seller of the representations and warranties
made
pursuant to Section 3.01 and the indemnification obligations of the Seller
pursuant to Section 7.01.
Any
successor appointed as provided herein shall execute, acknowledge and deliver
to
the Seller and to the Purchaser an instrument accepting such appointment,
whereupon such successor shall become fully vested with all the rights,
powers,
duties, responsibilities, obligations and liabilities of the Seller, with
like
effect as if originally named as a party to this Agreement. Any termination
or
resignation of the Seller or this Agreement pursuant to Section 7.04, 7.05,
8.01
or 9.01 shall not affect any claims that the Purchaser may have against
the
Seller arising prior to any such termination or resignation.
The
Seller shall promptly deliver to the successor the funds in the Custodial
Account and the Escrow Account and the Mortgage Files and related documents
and
statements held by it hereunder and the Seller shall account for all funds.
The
Seller shall execute and deliver such instruments and do such other things
all
as may reasonably be required to more fully and definitely vest and confirm
in
the successor all such rights, powers, duties, responsibilities, obligations
and
liabilities of the Seller. Upon appointment of successor servicer to the
Seller,
the Seller shall be reimbursed for unrecovered Servicing Advances, Monthly
Advances and unpaid Servicing Fees made by the Seller which would otherwise
have
been recovered by the Seller pursuant to this Agreement but for the appointment
such successor servicer.
Upon
a
successor’s acceptance of appointment as such, the Seller shall notify by mail
the Purchaser of such appointment.
SECTION
12.02 Amendment.
This
Agreement may be amended or supplemented from time to time by written agreement
executed by the Purchaser and the Seller.
SECTION
12.03 Recordation
of Agreement.
To
the
extent permitted by applicable law, this Agreement is subject to recordation
in
all appropriate public offices for real property records in all the counties
or
other comparable jurisdictions in which any of all the Mortgaged Properties
subject to the Mortgages are situated, and in any other appropriate public
recording office or elsewhere, such recordation to be effected by the Seller
at
the Seller’s expense on direction of the Purchaser.
SECTION
12.04 Governing
Law.
This
Agreement shall be governed by and construed in accordance with the laws
of the
State of New York, without regard to its conflict of law provisions, except
to
the extent preempted by Federal law. The obligations, rights and remedies
of the
parties hereunder shall be determined in accordance with such laws.
SECTION
12.05 Notices.
Any
demands, notices or other communications permitted or required hereunder
shall
be in writing and shall be deemed conclusively to have been given if personally
delivered at or mailed by registered mail, postage prepaid, and return
receipt
requested or certified mail, return receipt requested, or transmitted by
telex,
telegraph or telecopier and confirmed by a similar mailed writing, as
follows:
(i) if
to the
Seller:
Wachovia
Mortgage Corporation
000
Xxxxx
Xxxxxxx Xxxxxx
Xxxxx
0000
Xxxxxxxxx,
Xxxxx Xxxxxxxx 28288-1088
Attention:
Xxxxxxxx Xxxxx
Facsimile:
(000) 000-0000
with
a
copy to:
Wachovia
Mortgage Corporation
0000
Xxxxxxxxx Xxxxxx Xxxxx
Xxxxxxx,
Xxxxx Xxxxxxxx 00000
Attention:
Xxx Xxxxxx
Facsimile:
(000) 000-0000
(ii) if
to the
Purchaser:
Nomura
Credit & Capital, Inc.
2
World
Financial Xxxxxx
Xxxxxxxx
X, 00xx
Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
Xxxxx XxXxxxx, Managing Director
Facsimile:
(000)000-0000
with
copy
to:
NCCI
Legal
2
World
Financial Xxxxxx
Xxxxxxxx
X, 00xx
Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
or
such
other address as may hereafter be furnished to the other party by like
notice.
Any such demand, notice or communication hereunder shall be deemed to have
been
received on the date delivered to or received at the premises of the addressee
(as evidenced, in the case of registered or certified mail, by the date
noted on
the return receipt).
SECTION
12.06 Severability
of Provisions.
Any
part,
provision, representation or warranty of this Agreement which is prohibited
or
which is held to be void or unenforceable shall be ineffective to the extent
of
such prohibition or unenforceability without invalidating the remaining
provisions hereof. Any part, provision, representation or warranty of this
Agreement which is prohibited or unenforceable or is held to be void or
unenforceable in any jurisdiction shall be ineffective, as to such jurisdiction,
to the extent of such prohibition or unenforceability without invalidating
the
remaining provisions hereof, and any such prohibition or unenforceability
in any
jurisdiction as to any Mortgage Loan shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent permitted
by applicable law, the parties hereto waive any provision of law which
prohibits
or renders void or unenforceable any provision hereof. If the invalidity
of any
part, provision, representation or warranty of this Agreement shall deprive
any
party of the economic benefit intended to be conferred by this Agreement,
the
parties shall negotiate, in good faith, to develop a structure the economic
effect of which is nearly as possible the same as the economic effect of
this
Agreement without regard to such invalidity.
SECTION
12.07 Exhibits.
The
exhibits to this Agreement are hereby incorporated and made a part hereof
and
are an integral part of this Agreement.
SECTION
12.08 General
Interpretive Principles.
For
purposes of this Agreement, except as otherwise expressly provided or unless
the
context otherwise requires:
(i) the
terms
defined in this Agreement have the meanings assigned to them in this Agreement
and include the plural as well as the singular, and the use of any gender
herein
shall be deemed to include the other gender;
(ii) accounting
terms not otherwise defined herein have the meanings assigned to them in
accordance with GAAP;
(iii) references
herein to “Articles,” “Sections,” Subsections,” “Paragraphs,” and other
subdivisions without reference to a document are to designated Articles,
Sections, Subsections, Paragraphs and other subdivisions of this
Agreement;
(iv) a
reference to a Subsection without further reference to a Section is a reference
to such Subsection as contained in the same Section in which the reference
appears, and this rule shall also apply to Paragraphs and other
subdivisions;
(v) the
words
“herein,” “hereof,” “hereunder,” and other words of similar import refer to this
Agreement as a whole and not to any particular provision;
(vi) the
term
“include” or “including” shall mean without limitation by reason of enumeration;
and
(vii) headings
of the Articles and Sections in this Agreement are for reference purposes
only
and shall not be deemed to have any substantive effect.
SECTION
12.09 Reproduction
of Documents.
This
Agreement and all documents relating thereto, including, without limitation,
(i)
consents, waivers and modifications which may hereafter be executed, (ii)
documents received by any party at the closing, and (iii) financial statements,
certificates and other information previously or hereafter furnished, may
be
reproduced by any photographic, photostatic, microfilm, micro-card, miniature
photographic or other similar process. The parties agree that any such
reproduction shall be admissible in evidence as the original itself in
any
judicial or administrative proceeding, whether or not the original is in
existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in
evidence.
SECTION
12.10 Confidentiality
of Information.
Each
party recognizes that, in connection with this Agreement, it may become
privy to
non-public information regarding the financial condition, operations and
prospects of the other party. Except as required by law, each party agrees
to
keep all non-public information regarding the other party strictly confidential,
and to use all such information solely in order to effectuate the purpose
of the
Agreement, provided that each party may provide confidential information
to its
employees, agents and affiliates who have a need to know such information
in
order to effectuate the transaction, provided further that such information
is
identified as confidential non-public information. In addition, confidential
information may be provided to a regulatory authority with supervisory
power
over the Purchaser, provided such information is identified as confidential
non-public information.
SECTION
12.11 Recordation
of Assignments of Mortgage.
To
the
extent permitted by applicable law, each of the Assignments of Mortgage
is
subject to recordation in all appropriate public offices for real property
records in all the counties or other comparable jurisdictions in which
any or
all of the Mortgaged Properties are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected (i)
with
respect to MERS Mortgage Loans and (ii) with respect to Mortgage Loans
that are
not MERS Mortgage Loans, at the Seller’s expense, in each case, in the event
recordation is either necessary under applicable law or requested by the
Purchaser at its sole option.
SECTION
12.12 Assignment
by Purchaser.
The
Purchaser shall have the right, upon notice to the Seller, to assign, in
whole
or in part, its interest under this Agreement with respect to some or all
of the
Mortgage Loans, and designate any person to exercise any rights of the
Purchaser
hereunder, by executing an Assignment, Assumption and Recognition Agreement
substantially in the form of Exhibit
D
hereto,
and the assignee or designee shall accede to the rights and obligations
hereunder of the Purchaser with respect to such Mortgage Loans; provided,
however, that, in no event shall there be any more than three (3) “Purchasers”
with respect to any Mortgage Loan Package. In no event shall the Purchaser
sell
a partial interest in any Mortgage Loan without the prior written consent
of the
Seller, which consent may be granted or withheld in the Seller’s sole
discretion. All references to the Purchaser in this Agreement shall be
deemed to
include its assignee or designee.
SECTION
12.13 No
Partnership.
Nothing
herein contained shall be deemed or construed to create a co-partnership
or
joint venture between the parties hereto and the services of the Seller
shall be
rendered as an independent contractor and not as agent for
Purchaser.
SECTION
12.14 Execution;
Successors and Assigns.
This
Agreement may be executed in one or more counterparts and by the different
parties hereto on separate counterparts, each of which, when so executed,
shall
be deemed to be an original; such counterparts, together, shall constitute
one
and the same agreement. Subject to Section 7.02, this Agreement shall inure
to
the benefit of and be binding upon the Seller and the Purchaser and their
respective successors and assigns.
SECTION
12.15 Entire
Agreement.
Each
of
the parties to this Agreement acknowledges that no representations, agreements
or promises were made to any of the other parties to this Agreement or
any of
its employees other than those representations, agreements or promises
specifically contained herein. This Agreement and the related Purchase
Price and
Terms Letter set forth the entire understanding between the parties hereto
and
shall be binding upon all successors of all of the parties. In the event
of any
inconsistency between a Purchase Price and Terms Letter and this Agreement,
this
Agreement shall control.
SECTION
12.16 No
Solicitation.
From
and
after the related Closing Date, except as provided below, the Seller agrees
that
it will not take any action or permit or cause any action to be taken by
any of
its agents or affiliates, or by any independent contractors on the Seller’s
behalf, in any manner to solicit the borrower or obligor under any Mortgage
Loan
to refinance the Mortgage Loan, in whole or in part, without the prior
written
consent of the Purchaser. It is understood and agreed that all rights and
benefits relating to the solicitation of any Mortgagors to refinance any
Mortgage Loans and the attendant rights, title and interest in and to the
list
of such Mortgagors and data relating to their Mortgages (including insurance
renewal dates) shall be transferred to the Purchaser pursuant hereto on
the
related Closing Date and the Seller shall take no action to undermine these
rights and benefits. Notwithstanding the foregoing, it is understood and
agreed
that the following promotions or solicitations undertaken by the Seller
or any
affiliate of the Seller shall not be prohibited under this Section 11.16:
(i)
promotions or solicitations that are directed to the general public at
large or
segments thereof, provided that no segment shall consist primarily of the
borrowers or obligors under the Mortgage Loans, including, without limitation,
mass mailing based on commercially acquired mailing lists, newspaper, radio
and
television advertisements; (ii) responding to Mortgagor requests for pay-off
information and regarding other bank or financial products or services;
and
(iii) promotions or solicitations to any Mortgagor for any other bank or
financial products or services, unless such promotions or solicitations
are for
a prepayment of a Mortgage Loan.
SECTION
12.17 Costs.
The
Purchaser shall pay any commissions due its salesmen, the expenses of its
accountants and attorneys and the expenses and fees of any broker retained
by
the Purchaser with respect to the transactions covered by this Agreement.
To the
extent not otherwise provided herein, all other costs and expenses incurred
in
connection with the transfer and delivery of the Mortgage Loans, including,
without limitation, fees for recording intervening assignments of mortgage
and
Assignments of Mortgage, the cost of obtaining tax service contracts and
the
legal fees and expenses of its attorneys shall be paid by the Seller. The
Seller
shall be responsible for causing the recordation of all Assignments of
Mortgage
and all intervening assignments of mortgage, as applicable.
SECTION
12.18 Protection
of Mortgagor Personal Information.
Each
of
the Purchaser and the Seller agree that it (i) shall comply with any applicable
laws and regulations regarding the privacy and security of Mortgagor Personal
Information, (ii) shall not use Mortgagor Personal Information in any manner
inconsistent with any applicable laws and regulations regarding the privacy
and
security of Mortgagor Personal Information, (iii) shall not disclose Mortgagor
Personal Information to third parties except at the specific written direction
of the other; provided,
however,
that the
Purchaser and the Seller may disclose Mortgagor Personal Information to
third
parties in connection with secondary market transactions to the extent
not
prohibited by applicable law or to the extent required by a valid and effective
subpoena issued by a court of competent jurisdiction or other governmental
body,
(iv) shall maintain adequate physical, technical and administrative safeguards
to protect Mortgagor Personal Information from unauthorized access and
(v) shall immediately notify the other of any actual or suspected breach of
the confidentiality of Mortgagor Personal Information.
SECTION
12.19 Compliance
With Regulation AB.
In
order
to facilitate compliance with Regulation AB promulgated under the Securities
Act, the Seller and the Purchaser agree to comply with the provisions of
the
Regulation AB Compliance Addendum attached hereto as Addendum
I.
[SIGNATURE
PAGE TO FOLLOW]
IN
WITNESS WHEREOF, the Seller and the Purchaser have caused their names to
be
signed hereto by their respective officers thereunto duly authorized as
of the
day and year first above written.
NOMURA
CREDIT & CAPITAL, INC.,
as
Purchaser
|
||
|
|
|
By: ____________________________________________
|
||
Name:__________________________________________
|
||
Title:______________________________________ |
WACHOVIA
MORTGAGE
CORPORATION,
as Seller
|
||
|
|
|
By: ____________________________________________
|
||
Name:__________________________________________
|
||
Title:______________________________________ |
[Signature
Page to Seller’s Purchase, Warranties and Servicing Agreement, dated as of March
1, 2006]
Exhibit
A-1
Contents
of Mortgage File
With
respect to each Mortgage Loan, the Mortgage File shall include each of
the
following items, which shall be available for inspection by the Purchaser,
and
which shall be retained by the Seller in the Servicing File or delivered
to the
Purchaser or its designee pursuant to Sections 2.04 and 2.05 of the Seller’s
Purchase, Warranties and Servicing Agreement.
1. The
original Mortgage Note, with all applicable riders, endorsed “Pay to the order
of ___________________ without recourse,” and signed in the name of the Seller
by an authorized officer, with all intervening endorsements showing a complete
chain of title from the originator to the Seller. If the Mortgage Loan
was
acquired by the Seller in a merger, the endorsement must be by “[Seller],
successor by merger to the [name of predecessor]”. If the Mortgage Loan was
acquired or originated by the Seller while doing business under another
name,
the endorsement must be by “[Seller] formerly known as [previous name]”. If the
original note is unavailable, seller will provide an affidavit of lost
note (in
form acceptable to the Purchaser) stating that the original Mortgage Note
was
lost or destroyed, together with a copy of such Mortgage Note and indemnifying
the Purchaser against any and all claims arising as a result of any person
or
entity claiming they are the holder of the note or that the note has been
paid
off and returned.
2. A
true
certified copy, certified by the [title insurer], of the applicable First
Lien.
3. Except
as
provided below and for each Mortgage Loan that is not a MERS Mortgage Loan,
the
original Mortgage, with all applicable riders, with evidence of recording
thereon, or a copy thereof certified by the public recording office in
which
such mortgage has been recorded or, if the original Mortgage has not been
returned from the applicable public recording office, a true certified
copy,
certified by the [title insurer], of the original Mortgage together with
a
certificate of the Seller certifying that the original Mortgage has been
delivered for recording in the appropriate public recording office of the
jurisdiction in which the Mortgaged Property is located and in the case
of each
MERS Mortgage Loan, the original Mortgage, noting the presence of the MIN
of the
Mortgage Loans and either language indicating that the Mortgage Loan is
a MOM
Loan or if the Mortgage Loan was not a MOM Loan at origination, the original
Mortgage and the assignment thereof to MERS, with evidence of recording
indicated thereon, or a copy of the Mortgage certified by the public recording
office in which such Mortgage has been recorded.
4. The
original or certified to be a true copy or if in electronic form identified
on
the Mortgage Loan Schedule, the certificate number, certified by the Seller,
of
the related Primary Mortgage Insurance Policy, if required.
5. In
the
case of each Mortgage Loan that is not a MERS Mortgage Loan, the original
Assignment, from the Seller in accordance with Purchaser’s instructions, which
assignment shall, but for any blanks requested by the Purchaser, be in
form and
substance acceptable for recording, or a copy certified by the Seller as
a true
and correct copy of the original Assignment which has been sent for recordation.
If the Mortgage Loan was acquired or originated by the Seller while doing
business under another name, the Assignment must be by “[Seller] formerly known
as [previous name]”.
6. With
respect to Mortgage Loans that are not Co-op Loans, the original policy
of title
insurance, including riders and endorsements thereto, or if the policy
has not
yet been issued, a written commitment or interim binder or preliminary
report of
title issued by the title insurance or escrow company.
7. Originals
of all recorded intervening Assignments, or copies thereof, certified by
the
public recording office in which such Assignments have been recorded showing
a
complete chain of title from the originator to the Seller, with evidence
of
recording thereon, or a copy thereof certified by the public recording
office in
which such Assignment has been recorded or, if the original Assignment
has not
been returned from the applicable public recording office, a true certified
copy, certified by the [title insurer] of the original Assignment together
with
a certificate of the [title insurer] certifying that the original Assignment
has
been delivered for recording in the appropriate public recording office
of the
jurisdiction in which the Mortgaged Property is located.
8. Originals,
or copies thereof certified by the public recording office in which such
documents have been recorded, of each assumption, extension, modification,
written assurance or substitution agreements, if applicable, or if the
original
of such document has not been returned from the applicable public recording
office, a true certified copy, certified by the [title insurer], of such
original document together with certificate of Seller certifying the original
of
such document has been delivered for recording in the appropriate recording
office of the jurisdiction in which the Mortgaged Property is
located.
9. If
the
Mortgage Note or Mortgage or any other material document or instrument
relating
to the Mortgage Loan has been signed by a person on behalf of the Mortgagor,
the
original power of attorney or other instrument that authorized and empowered
such person to sign bearing evidence that such instrument has been recorded,
if
so required in the appropriate jurisdiction where the Mortgaged Property
is
located (or, in lieu thereof, a duplicate or conformed copy of such instrument,
together with a certificate of receipt from the recording office, certifying
that such copy represents a true and complete copy of the original and
that such
original has been or is currently submitted to be recorded in the appropriate
governmental recording office of the jurisdiction where the Mortgaged Property
is located), or if the original power of attorney or other such instrument
has
been delivered for recording in the appropriate public recording office
of the
jurisdiction in which the Mortgaged Property is located.
10. With
respect to a Co-op Loan: (i) a copy of the Co-op Lease and the assignment
of
such Co-op Lease to the originator of the Mortgage Loan, with all intervening
assignments showing a complete chain of title and an assignment thereof
by
Seller; (ii) the stock certificate together with an undated stock power
relating
to such stock certificate executed in blank; (iii) the recognition agreement
in
substantially the same form as standard a “AZTECH” form; (iv) copies of the
financial statement filed by the originator as secured party and, if applicable,
a filed UCC-3 Assignment of the subject security interest showing a complete
chain of title, together with an executed UCC-3 Assignment of such security
interest by the Seller in a form sufficient for filing.
11. The
original of any guarantee executed in connection with the Mortgage
Note.
Notwithstanding
anything to the contrary herein, the Seller may provide one certificate
for all
of the Mortgage Loans indicating that the documents were delivered for
recording.
Exhibit
A-2
Contents
of Servicing File
With
respect to each Mortgage Loan, the Servicing File shall include each of
the
following items, which shall be available for inspection by the
Purchaser:
1. Mortgage
Loan closing statement (Form HUD-1) and any other truth-in-lending or real
estate settlement procedure forms required by law.
2. Residential
loan application.
3. Uniform
underwriter and transmittal summary (Xxxxxx Xxx Form 1008) or reasonable
equivalent.
4. Credit
report on the mortgagor.
5. Business
credit report, if applicable.
6. Residential
appraisal report and attachments thereto.
7. Verification
of employment and income except for Mortgage Loans originated under a Limited
Documentation Program, all in accordance with Seller’s Underwriting
Standards.
8. Verification
of acceptable evidence of source and amount of down payment, in accordance
with
the Underwriting Standards.
9. Photograph
of the Mortgaged Property (may be part of appraisal).
10. Survey
of
the Mortgaged Property, if any.
11. Sales
contract, if applicable.
12. If
available, termite report, structural engineer’s report, water portability and
septic certification.
13. Any
original security agreement, chattel mortgage or equivalent executed in
connection with the Mortgage.
14. Any
ground lease, including all amendments, modifications and supplements
thereto.
15. Any
other
document required to service the Mortgage Loans.
Exhibit
B
Form
of Custodial Account Letter Agreement
__________________
, 200_
To:
As
“Seller” under the Seller’s Purchase, Warranties and Servicing Agreement, dated
as of March 1, 2006 (the “Agreement”), we hereby authorize and request you to
establish an account, as a Custodial Account pursuant to Section 4.04 of
the
Agreement, to be designated as “Wachovia Mortgage Corporation, in trust for the
Purchaser, owner of various whole loan series - principal and interest”. All
deposits in the account shall be subject to withdrawal therefrom by order
signed
by the Seller. This letter is submitted to you in duplicate. Please execute
and
return one original to us.
WACHOVIA
MORTGAGE CORPORATION,
as
SELLER
|
||
|
|
|
By: ____________________________________________
|
||
Name:__________________________________________
|
||
Title:______________________________________ |
The
undersigned, as “Depository,” hereby certifies that the above described account
has been established under Account Number ______________, at the office
of the
depository indicated above, and agrees to honor withdrawals on such account
as
provided above.
_______________________________________________
|
||
|
|
|
By: ____________________________________________
|
||
Name:__________________________________________
|
||
Title:______________________________________ |
Exhibit
C
Form
of Escrow Account Letter Agreement
_____________________,
200_
To:
As
“Seller” under the Seller’s Purchase, Warranties and Servicing Agreement, dated
as of March 1, 2006 (the “Agreement”), we hereby authorize and request you to
establish an account, as an Escrow Account pursuant to Section 4.06 of
the
Agreement, to be designated as “Wachovia Mortgage Corporation, in trust for the
Purchaser, owner of various whole loan series, and various Mortgagors.” All
deposits in the account shall be subject to withdrawal therefrom by order
signed
by the Seller. This letter is submitted to you in duplicate. Please execute
and
return one original to us.
WACHOVIA
MORTGAGE CORPORATION,
as
SELLER
|
||
|
|
|
By: ____________________________________________
|
||
Name:__________________________________________
|
||
Title:______________________________________ |
The
undersigned, as “Depository,” hereby certifies that the above described account
has been established under Account Number ______________, at the office
of the
depository indicated above, and agrees to honor withdrawals on such account
as
provided above.
|
||
|
|
|
By: ____________________________________________
|
||
Name:__________________________________________
|
||
Title:______________________________________ |
Exhibit
D
Form
of Assignment, Assumption and Recognition Agreement
This
Assignment, Assumption and Recognition Agreement (this “Assignment Agreement”),
dated as of _________, between Nomura Credit & Capital, Inc., a
[_____________] corporation (the “Assignor”), ______________________, a ________
corporation (the “Assignee”), and Wachovia Mortgage Corporation, a North
Carolina corporation (the “Seller”):
For
good
and valuable consideration the receipt and sufficiency of which hereby
are
acknowledged, and of the premises and mutual covenants herein contained,
the
parties hereto hereby agree as follows:
1. The
Assignor hereby grants, transfers and assigns to Assignee all of the right,
title and interest of Assignor, as Purchaser, in, to and under (a) those
certain
mortgage loans listed on Exhibit A attached hereto (the “Mortgage Loans”); and
(b) the Seller’s Purchase, Warranties and Servicing Agreement dated as of March
1, 2006, but only to the extent of the Mortgage Loans (the “Purchase
Agreement”). For purposes of this Assignment Agreement, the term “Purchase
Agreement” includes any separate Assignment and Conveyance pursuant to which
Seller and Assignor effectuated the purchase and sale of any Mortgage Loan
following the execution and delivery of the Seller’s Purchase, Warranties and
Servicing Agreement dated as of March 1, 2006.
The
Assignor specifically reserves and does not assign to the Assignee hereunder
any
and all right, title and interest in, to and under any all obligations
of the
Assignor with respect to any mortgage loans subject to the Purchase Agreement
which are not the Mortgage Loans set forth on Exhibit A attached hereto
and are
not the subject of this Assignment Agreement.
2. Each
of
the Seller and the Assignor represent and warrant to the Assignee that
(a) the
copy of the Purchase Agreement, attached hereto as Exhibit B, provided
to the
Assignee, is a true, complete and accurate copy of the Purchase Agreement,
(b)
the Purchase Agreement is in full force and effect as of the date hereof,
(c)
the provisions thereof have not been waived, amended or modified in any
respect,
nor have any notices of termination been given thereunder, (d) the Purchase
Agreement contains all of the terms and conditions governing the sale of
the
Mortgage Loans by Seller to Assignor and the purchase of the Mortgage Loans
by
Assignor from Seller; provided,
however,
that
the date of purchase and sale and the amount of payment for the Mortgage
Loans
may be set out in a Purchase Price and Terms Letter, as defined in the
Purchase
Agreement, and (e) Seller sold, conveyed and transferred each Mortgage
Loan to
Assignor pursuant to the Purchase Agreement.
3. The
Assignor warrants and represents to, and covenants with, the Assignee and
the
Seller that:
(a) As
of the
date hereof, the Assignor is not in default under the Purchase
Agreement;
(b) The
Assignor is the lawful owner of the Mortgage Loans with the full right
to
transfer the Mortgage Loans and any and all of its interests, rights and
obligations under the Purchase Agreement, free from any and all claims
and
encumbrances arising out of the Assignor’s ownership thereof, and the Mortgage
Loans, as well as the Purchase Agreement, upon the transfer thereof to
the
Assignee as contemplated herein, shall be free and clear of all such liens,
claims and encumbrances or any lien claim or encumbrance arising out of
the
ownership of the Mortgage Loans by any person at any time after Assignor
first
acquired any Mortgage Loan from the Seller;
(c) The
Assignor has not received notice of, and has no knowledge of, any offsets,
counterclaims or other defenses available to the Seller with respect to
the
Purchase Agreement or the Mortgage Loans;
(d) The
Assignor has not waived or agreed to any waiver under, or agreed to any
amendment or other modification of, the Purchase Agreement or the Mortgage
Loans. The Assignor has no knowledge of, and has not received notice of,
any
waivers under or amendments or other modifications of, or assignments of
rights
or obligations under or defaults under, the Purchase Agreement, or the
Mortgage
Loans;
(e) The
Assignor is a corporation duly organized, validly existing and in good
standing
under the laws of the jurisdiction of its incorporation, and has all requisite
corporate power and authority to sell, transfer and assign the Mortgage
Loans;
(f) The
Assignor has full corporate power and authority to execute, deliver and
perform
under this Assignment Agreement, and to consummate the transactions set
forth
herein. The consummation of the transactions contemplated by this Assignment
Agreement is in the ordinary course of the Assignor’s business and will not
conflict with, or result in a breach of, any of the terms, conditions or
provisions of the Assignor’s charter or by-laws, or any legal restriction, or
any material agreement or instrument to which the Assignor is now a party
or by
which it is bound, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Assignor or its property is subject.
The
execution, delivery and performance by the Assignor of this Assignment
Agreement, and the consummation by it of the transactions contemplated
hereby,
have been duly authorized by all necessary corporate action of the Assignor.
This Assignment Agreement has been duly executed and delivered by the Assignor
and constitutes the valid and legally binding obligation of the Assignor
enforceable against the Assignor in accordance with its respective terms
except
as enforceability thereof may be limited by bankruptcy, insolvency, or
reorganization or other similar laws now or hereinafter in effect relating
to
creditor’s rights generally and by general principles of equity, regardless of
whether such enforceability is considered in a proceeding in equity or
in
law;
(g) No
material consent, approval, order or authorization of, or declaration,
filing or
registration with, any governmental entity is required to be obtained or
made by
the Assignor in connection with the execution, delivery or performance
by the
Assignor of this Assignment Agreement, or the consummation by it of the
transactions contemplated hereby; and
(h) The
Assignor has paid the purchase price for the Mortgage Loans and has satisfied
any conditions to closing required of it under the terms of the Purchase
Agreement.
4. The
Assignee warrants and represents to, and covenants with, the Assignor and
the
Seller that:
(a) The
Assignee is a corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation, and has all requisite
corporate power and authority to acquire, own and purchase the Mortgage
Loans;
(b) The
Assignee has full corporate power and authority to execute, deliver and perform
under this Assignment Agreement, and to consummate the transactions set forth
herein. The consummation of the transactions contemplated by this Assignment
Agreement is in the ordinary course of the Assignee’s business and will not
conflict with, or result in a breach of, any of the terms, conditions or
provisions of the Assignee’s charter or by-laws, or any legal restriction, or
any material agreement or instrument to which the Assignee is now a party
or by
which it is bound, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Assignee or its property is subject.
The
execution, delivery and performance by the Assignee of this Assignment
Agreement, and the consummation by it of the transactions contemplated hereby,
have been duly authorized by all necessary corporate action of the Assignee.
This Assignment Agreement has been duly executed and delivered by the Assignee
and constitutes the valid and legally binding obligation of the Assignee
enforceable against the Assignee in accordance with its respective terms
except
as enforceability thereof may be limited by bankruptcy, insolvency, or
reorganization or other similar laws now or hereinafter in effect relating
to
creditor’s rights generally and by general principles of equity, regardless of
whether such enforceability is considered in a proceeding in equity or in
law;
(c) No
material consent, approval, order or authorization of, or declaration, filing
or
registration with, any governmental entity is required to be obtained or
made by
the Assignee in connection with the execution, delivery or performance by
the
Assignee of this Assignment Agreement, or the consummation by it of the
transactions contemplated hereby; and
(d) The
Assignee agrees to be bound, as Purchaser, by all of the terms, covenants
and
conditions of the Purchase Agreement and the Mortgage Loans, and from and
after
the date hereof, the Assignee assumes for the benefit of each of the Seller
and
the Assignor all of the Assignor’s obligations as Purchaser thereunder, with
respect to the Mortgage Loans.
5. The
Seller warrants and represents to, and covenants with, the Assignor and the
Assignee that:
(a) The
Seller is not a natural person or a general partnership and is duly organized,
validly existing and in good standing under the laws of the jurisdiction
of its
formation, and has all requisite power and authority to service the Mortgage
Loans;
(b) The
Seller has full power and authority to execute, deliver and perform under
this
Assignment Agreement, and to consummate the transactions set forth herein.
The
consummation of the transactions contemplated by this Assignment Agreement
is in
the ordinary course of the Seller’s business and will not conflict with, or
result in a breach of, any of the terms, conditions or provisions of the
Seller’s charter or by-laws, or any legal restriction, or any material agreement
or instrument to which the Seller is now a party or by which it is bound,
or
result in the violation of any law, rule, regulation, order, judgment or
decree
to which the Seller or its property is subject. The execution, delivery and
performance by the Seller of this Assignment Agreement, and the consummation
by
it of the transactions contemplated hereby, have been duly authorized by
all
necessary corporate action of the Seller. This Assignment Agreement has been
duly executed and delivered by the Seller and constitutes the valid and legally
binding obligation of the Seller enforceable against the Seller in accordance
with its respective terms except as enforceability thereof may be limited
by
bankruptcy, insolvency, or reorganization or other similar laws now or
hereinafter in effect relating to creditors’ rights generally and by general
principles of equity, regardless of whether such enforceability is considered
in
a proceeding in equity or in law;
(d) No
material consent, approval, order or authorization of, or declaration, filing
or
registration with, any governmental entity is required to be obtained or
made by
the Seller in connection with the execution, delivery or performance by the
Seller of this Assignment Agreement, or the consummation by it of the
transactions contemplated hereby;
(e) As
of the
date hereof, the Seller is not in default under the Purchase Agreement;
and
(f) No
event
has occurred or has failed to occur, during the period commencing on date
on
which Assignor acquired the Mortgage Loans and ending on the date hereof,
inclusive, which would make the representations and warranties set forth
in
Section 3.01 of the Purchase Agreement untrue if such representations and
warranties were made with respect to the Mortgage Loans effective as of the
date
hereof.
6. From
and
after the date hereof, the Seller shall recognize the Assignee as the owner
of
the Mortgage Loans, and shall look solely to the Assignee for performance
from
and after the date hereof of the Assignor’s obligations with respect to the
Mortgage Loans.
7. Notice
Addresses.
(a) The
Assignee’s address for purposes of all notices and correspondence related to the
Mortgage Loans and this Assignment Agreement is:
________________
________________
________________
Attention:
________________
(b) The
Assignor’s address for purposes for all notices and correspondence related to
the Mortgage Loans and this Assignment Agreement is:
Nomura
Credit & Capital, Inc.
[_____________________________]
[_____________________________]
[_____________________________]
Attention:
_______________
(c) The
Seller’s address for purposes of all notices and correspondence related to the
Mortgage Loans and this Assignment Agreement is:
Wachovia
Mortgage Corporation
0000
Xxxxxxxxx Xxxxxx Xxxxx
Xxxxxxx,
Xxxxx Xxxxxxxx 00000
Attention:
Xxx Xxxxxx
8. This
Assignment Agreement shall be construed in accordance with the substantive
laws
of the State of New York (without regard to conflict of laws principles)
and the
obligations, rights and remedies of the parties hereunder shall be determined
in
accordance with such laws, except to the extent preempted by federal
law.
9. This
Assignment Agreement shall inure to the benefit of the successors and assigns
of
the parties hereto. Any entity into which the Seller, the Assignor or the
Assignee may be merged or consolidated shall, without the requirement for
any
further writing, be deemed the Seller, the Assignor or the Assignee,
respectively, hereunder.
10. No
term
or provision of this Assignment Agreement may be waived or modified unless
such
waiver or modification is in writing and signed by the party against whom
such
waiver or modification is sought to be enforced.
11. This
Assignment Agreement shall survive the conveyance of the Mortgage Loans and
the
assignment of the Purchase Agreement by the Assignor.
12. Notwithstanding
the assignment of the Purchase Agreement by either the Assignor or Assignee,
this Assignment Agreement shall not be deemed assigned by the Seller or the
Assignor unless assigned by separate written instrument.
13. For
the
purpose for facilitating the execution of this Assignment Agreement as herein
provided and for other purposes, this Assignment Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts
shall
be deemed to be an original, and such counterparts shall constitute and be
one
and the same instrument.
[signatures
on following page]
IN
WITNESS WHEREOF, the parties have caused this Assignment Agreement to be
executed by their duly authorized officers as of the date first above
written.
Nomura
Credit & Capital, Inc.
Assignor
|
||
|
|
|
By:___________________________________ | ||
Name:_________________________________ | ||
Title:______________________________
[______________________________________]
Assignee
By:___________________________________
Name:_________________________________
Title:______________________________
|
|
||
Wachovia
Mortgage Corporation
Seller
|
||
|
|
|
By:___________________________________ | ||
Name:_________________________________ | ||
Title:______________________________ |
Exhibit
E
Form
of Assignment and Conveyance
On
this
____ day of ________, 200_, Wachovia Mortgage Corporation (“Wachovia”) as the
Seller under that certain Seller’s Purchase, Warranties and Servicing Agreement,
dated as of March 1, 2006 (the “Agreement”), by and between Wachovia and Nomura
Credit & Capital, Inc. (the “Purchaser”) does hereby sell, transfer, assign,
set over and convey to the Purchaser under the Agreement, without recourse,
but
subject to the terms of the Agreement, all rights, title and interest of
Wachovia (excluding the right to service the Mortgage Loans) in and to the
Mortgage Loans listed on the Mortgage Loan Schedule attached hereto as
Exhibit
A,
together with the Mortgage Files and all rights and obligations arising under
the documents contained therein. Pursuant to Section 2.07 of the Agreement,
Wachovia has delivered to the Purchaser the documents for each Mortgage Loan
to
be purchased as set forth therein. The contents of each Servicing File required
to be retained by Wachovia to service the Mortgage Loans pursuant to the
Agreement and thus not delivered to the Purchaser are and shall be held in
trust
by Wachovia, for the benefit of the Purchaser as the owner thereof. Wachovia’s
possession of any portion of the Servicing File is at the will of the Purchaser
for the sole purpose of facilitating servicing of the related Mortgage Loan
pursuant to the Agreement, and such retention and possession by Wachovia
shall
be in a custodial capacity only. The ownership of each Mortgage Note, Mortgage,
and the contents of the Mortgage File and Servicing File is vested in the
Purchaser and the ownership of all records and documents with respect to
the
related Mortgage Loan prepared by or which come into the possession of Wachovia
shall immediately vest in the Purchaser and shall be retained and maintained,
in
trust, by Wachovia at the will of the Purchaser in such custodial capacity
only.
Capitalized
terms used herein and not otherwise defined shall have the meanings set forth
in
the Agreement.
WACHOVIA
MORTGAGE
CORPORATION
|
||
|
|
|
By:______________________________________________ | ||
|
||
Name:____________________________________________
Title:_____________________________________________
|
Exhibit
F
Request
for Release of Documents and Receipt
RE: Mortgage
Loan #___________________________________
BORROWER: __________________________________________________
PROPERTY:
__________________________________________________
Pursuant
to a Seller’s Purchase, Warranties and Servicing Agreement (the “Agreement”)
between the Seller and the Purchaser, the undersigned hereby certifies that
he
or she is an officer of the Seller requesting release of the documents for
the
reason specified below. The undersigned further certifies that:
(Check
one of the items below)
_____
|
On
_________________, the above captioned mortgage loan was paid in
full or
the Seller has been notified that payment in full has been or will
be
escrowed. The Seller hereby certifies that all amounts with respect
to
this loan which are required under the Agreement have been or will
be
deposited in the Custodial Account as required.
|
_____
|
The
above captioned loan is being repurchased pursuant to the terms
of the
Agreement. The Seller hereby certifies that the repurchase price
has been
credited to the Custodial Account as required under the
Agreement.
|
_____
|
The
above captioned loan is being placed in foreclosure and the original
documents are required to proceed with the foreclosure action.
The Seller
hereby certifies that the documents will be returned to the Purchaser
in
the event of reinstatement.
|
_____
|
Other
(explain)
|
_______________________________________________________
_______________________________________________________
|
All
capitalized terms used herein and not defined shall have the meanings assigned
to them in the Agreement.
Based
on
this certification and the indemnities provided for in the Agreement, please
release to the Seller all original mortgage documents in your possession
relating to this loan.
Dated:_________________ By:________________________________
Signature
___________________________________
Title
Send
documents to: _____________________________________________
_____________________________________________
_____________________________________________
Acknowledgment:
Purchaser
hereby acknowledges that all original documents previously released on the
above
captioned mortgage loan have been returned and received by the
Purchaser.
Dated:________________ By:________________________________
Signature
Title:____________________________
ATTACHMENT
3
EXHIBIT
G
STANDARD
FILE LAYOUT- SCHEDULED/SCHEDULED
Exhibit 1: Standard File Layout - Master Servicing |
Column
Name
|
Description
|
Decimal
|
Format
Comment
|
Max
Size
|
SER_INVESTOR_NBR
|
A
value assigned by the Servicer to define a group of loans.
|
|
Text
up to 10 digits
|
20
|
LOAN_NBR
|
A
unique identifier assigned to each loan by the investor.
|
|
Text
up to 10 digits
|
10
|
SERVICER_LOAN_NBR
|
A
unique number assigned to a loan by the Servicer. This may be different
than the LOAN_NBR.
|
|
Text
up to 10 digits
|
10
|
BORROWER_NAME
|
The
borrower name as received in the file. It is not separated by first
and
last name.
|
|
Maximum
length of 30 (Last, First)
|
30
|
SCHED_PAY_AMT
|
Scheduled
monthly principal and scheduled interest payment that a borrower
is
expected to pay, P&I constant.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
NOTE_INT_RATE
|
The
loan interest rate as reported by the Servicer.
|
4
|
Max
length of 6
|
6
|
NET_INT_RATE
|
The
loan gross interest rate less the service fee rate as reported
by the
Servicer.
|
4
|
Max
length of 6
|
6
|
SERV_FEE_RATE
|
The
servicer's fee rate for a loan as reported by the Servicer.
|
4
|
Max
length of 6
|
6
|
SERV_FEE_AMT
|
The
servicer's fee amount for a loan as reported by the Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
NEW_PAY_AMT
|
The
new loan payment amount as reported by the Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
NEW_LOAN_RATE
|
The
new loan rate as reported by the Servicer.
|
4
|
Max
length of 6
|
6
|
ARM_INDEX_RATE
|
The
index the Servicer is using to calculate a forecasted
rate.
|
4
|
Max
length of 6
|
6
|
ACTL_BEG_PRIN_BAL
|
The
borrower's actual principal balance at the beginning of the processing
cycle.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
ACTL_END_PRIN_BAL
|
The
borrower's actual principal balance at the end of the processing
cycle.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
BORR_NEXT_PAY_DUE_DATE
|
The
date at the end of processing cycle that the borrower's next payment
is
due to the Servicer, as reported by Servicer.
|
|
MM/DD/YYYY
|
10
|
SERV_CURT_AMT_1
|
The
first curtailment amount to be applied.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SERV_CURT_DATE_1
|
The
curtailment date associated with the first curtailment amount.
|
|
MM/DD/YYYY
|
10
|
CURT_ADJ_
AMT_1
|
The
curtailment interest on the first curtailment amount, if
applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SERV_CURT_AMT_2
|
The
second curtailment amount to be applied.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SERV_CURT_DATE_2
|
The
curtailment date associated with the second curtailment
amount.
|
|
MM/DD/YYYY
|
10
|
CURT_ADJ_
AMT_2
|
The
curtailment interest on the second curtailment amount, if
applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SERV_CURT_AMT_3
|
The
third curtailment amount to be applied.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SERV_CURT_DATE_3
|
The
curtailment date associated with the third curtailment
amount.
|
|
MM/DD/YYYY
|
10
|
CURT_ADJ_AMT_3
|
The
curtailment interest on the third curtailment amount, if
applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
PIF_AMT
|
The
loan "paid in full" amount as reported by the Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
PIF_DATE
|
The
paid in full date as reported by the Servicer.
|
|
MM/DD/YYYY
|
10
|
|
|
|
Action
Code Key: 15=Bankruptcy, 00xXxxxxxxxxxx, , 00xXXX, 63=Substitution,
65=Repurchase,70=REO
|
2
|
ACTION_CODE
|
The
standard FNMA numeric code used to indicate the default/delinquent
status
of a particular loan.
|
|||
INT_ADJ_AMT
|
The
amount of the interest adjustment as reported by the
Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SOLDIER_SAILOR_ADJ_AMT
|
The
Soldier and Sailor Adjustment amount, if applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
NON_ADV_LOAN_AMT
|
The
Non Recoverable Loan Amount, if applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
LOAN_LOSS_AMT
|
The
amount the Servicer is passing as a loss, if applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SCHED_BEG_PRIN_BAL
|
The
scheduled outstanding principal amount due at the beginning of
the cycle
date to be passed through to investors.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SCHED_END_PRIN_BAL
|
The
scheduled principal balance due to investors at the end of a processing
cycle.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SCHED_PRIN_AMT
|
The
scheduled principal amount as reported by the Servicer for the
current
cycle -- only applicable for Scheduled/Scheduled Loans.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SCHED_NET_INT
|
The
scheduled gross interest amount less the service fee amount for
the
current cycle as reported by the Servicer -- only applicable for
Scheduled/Scheduled Loans.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
ACTL_PRIN_AMT
|
The
actual principal amount collected by the Servicer for the current
reporting cycle -- only applicable for Actual/Actual
Loans.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
ACTL_NET_INT
|
The
actual gross interest amount less the service fee amount for the
current
reporting cycle as reported by the Servicer -- only applicable
for
Actual/Actual Loans.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
PREPAY_PENALTY_
AMT
|
The
penalty amount received when a borrower prepays on his loan as
reported by
the Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
PREPAY_PENALTY_
WAIVED
|
The
prepayment penalty amount for the loan waived by the
servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
|
|
|
|
MOD_DATE
|
The
Effective Payment Date of the Modification for the loan.
|
|
MM/DD/YYYY
|
10
|
MOD_TYPE
|
The
Modification Type.
|
|
Varchar
- value can be alpha or numeric
|
30
|
DELINQ_P&I_ADVANCE_AMT
|
The
current outstanding principal and interest advances made by
Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
STANDARD
FILE LAYOUT- DELINQUENCY REPORTING
Exhibit 1: Standard File Layout - Delinquency Reporting |
Column/Header
Name
|
Description
|
Decimal
|
Format
Comment
|
SERVICER_LOAN_NBR
|
A
unique number assigned to a loan by the Servicer. This may be different
than the LOAN_NBR
|
|
|
LOAN_NBR
|
A
unique identifier assigned to each loan by the originator.
|
|
|
CLIENT_NBR
|
Servicer
Client Number
|
||
SERV_INVESTOR_NBR
|
Contains
a unique number as assigned by an external servicer to identify
a group of
loans in their system.
|
|
|
BORROWER_FIRST_NAME
|
First
Name of the Borrower.
|
||
BORROWER_LAST_NAME
|
Last
name of the borrower.
|
||
PROP_ADDRESS
|
Street
Name and Number of Property
|
|
|
PROP_STATE
|
The
state where the property located.
|
|
|
PROP_ZIP
|
Zip
code where the property is located.
|
|
|
BORR_NEXT_PAY_DUE_DATE
|
The
date that the borrower's next payment is due to the servicer at
the end of
processing cycle, as reported by Servicer.
|
MM/DD/YYYY
|
|
LOAN_TYPE
|
Loan
Type (i.e. FHA, VA, Conv)
|
|
|
BANKRUPTCY_FILED_DATE
|
The
date a particular bankruptcy claim was filed.
|
MM/DD/YYYY
|
|
BANKRUPTCY_CHAPTER_CODE
|
The
chapter under which the bankruptcy was filed.
|
|
|
BANKRUPTCY_CASE_NBR
|
The
case number assigned by the court to the bankruptcy
filing.
|
|
|
POST_PETITION_DUE_DATE
|
The
payment due date once the bankruptcy has been approved by the
courts
|
MM/DD/YYYY
|
|
BANKRUPTCY_DCHRG_DISM_DATE
|
The
Date The Loan Is Removed From Bankruptcy. Either by Dismissal,
Discharged
and/or a Motion For Relief Was Granted.
|
MM/DD/YYYY
|
|
LOSS_MIT_APPR_DATE
|
The
Date The Loss Mitigation Was Approved By The Servicer
|
MM/DD/YYYY
|
|
LOSS_MIT_TYPE
|
The
Type Of Loss Mitigation Approved For A Loan Such As;
|
||
LOSS_MIT_EST_COMP_DATE
|
The
Date The Loss Mitigation /Plan Is Scheduled To End/Close
|
MM/DD/YYYY
|
|
LOSS_MIT_ACT_COMP_DATE
|
The
Date The Loss Mitigation Is Actually Completed
|
MM/DD/YYYY
|
|
FRCLSR_APPROVED_DATE
|
The
date DA Admin sends a letter to the servicer with instructions
to begin
foreclosure proceedings.
|
MM/DD/YYYY
|
|
ATTORNEY_REFERRAL_DATE
|
Date
File Was Referred To Attorney to Pursue Foreclosure
|
MM/DD/YYYY
|
|
FIRST_LEGAL_DATE
|
Notice
of 1st legal filed by an Attorney in a Foreclosure Action
|
MM/DD/YYYY
|
|
FRCLSR_SALE_EXPECTED_DATE
|
The
date by which a foreclosure sale is expected to occur.
|
MM/DD/YYYY
|
|
FRCLSR_SALE_DATE
|
The
actual date of the foreclosure sale.
|
MM/DD/YYYY
|
|
FRCLSR_SALE_AMT
|
The
amount a property sold for at the foreclosure sale.
|
2
|
No
commas(,) or dollar signs ($)
|
EVICTION_START_DATE
|
The
date the servicer initiates eviction of the borrower.
|
MM/DD/YYYY
|
|
EVICTION_COMPLETED_DATE
|
The
date the court revokes legal possession of the property from the
borrower.
|
MM/DD/YYYY
|
|
LIST_PRICE
|
The
price at which an REO property is marketed.
|
2
|
No
commas(,) or dollar signs ($)
|
LIST_DATE
|
The
date an REO property is listed at a particular price.
|
MM/DD/YYYY
|
|
OFFER_AMT
|
The
dollar value of an offer for an REO property.
|
2
|
No
commas(,) or dollar signs ($)
|
OFFER_DATE_TIME
|
The
date an offer is received by DA Admin or by the Servicer.
|
MM/DD/YYYY
|
|
REO_CLOSING_DATE
|
The
date the REO sale of the property is scheduled to close.
|
MM/DD/YYYY
|
|
REO_ACTUAL_CLOSING_DATE
|
Actual
Date Of REO Sale
|
MM/DD/YYYY
|
|
OCCUPANT_CODE
|
Classification
of how the property is occupied.
|
|
|
PROP_CONDITION_CODE
|
A
code that indicates the condition of the property.
|
|
|
PROP_INSPECTION_DATE
|
The
date a property inspection is performed.
|
MM/DD/YYYY
|
|
APPRAISAL_DATE
|
The
date the appraisal was done.
|
MM/DD/YYYY
|
|
CURR_PROP_VAL
|
The
current "as is" value of the property based on brokers price opinion
or
appraisal.
|
2
|
|
REPAIRED_PROP_VAL
|
The
amount the property would be worth if repairs are completed pursuant
to a
broker's price opinion or appraisal.
|
2
|
|
If
applicable:
|
|
|
|
DELINQ_STATUS_CODE
|
FNMA
Code Describing Status of Loan
|
||
DELINQ_REASON_CODE
|
The
circumstances which caused a borrower to stop paying on a loan.
Code
indicates the reason why the loan is in default for this
cycle.
|
||
MI_CLAIM_FILED_DATE
|
Date
Mortgage Insurance Claim Was Filed With Mortgage Insurance
Company.
|
MM/DD/YYYY
|
|
MI_CLAIM_AMT
|
Amount
of Mortgage Insurance Claim Filed
|
No
commas(,) or dollar signs ($)
|
|
MI_CLAIM_PAID_DATE
|
Date
Mortgage Insurance Company Disbursed Claim Payment
|
MM/DD/YYYY
|
|
MI_CLAIM_AMT_PAID
|
Amount
Mortgage Insurance Company Paid On Claim
|
2
|
No
commas(,) or dollar signs ($)
|
POOL_CLAIM_FILED_DATE
|
Date
Claim Was Filed With Pool Insurance Company
|
MM/DD/YYYY
|
|
POOL_CLAIM_AMT
|
Amount
of Claim Filed With Pool Insurance Company
|
2
|
No
commas(,) or dollar signs ($)
|
POOL_CLAIM_PAID_DATE
|
Date
Claim Was Settled and The Check Was Issued By The Pool
Insurer
|
MM/DD/YYYY
|
|
POOL_CLAIM_AMT_PAID
|
Amount
Paid On Claim By Pool Insurance Company
|
2
|
No
commas(,) or dollar signs ($)
|
FHA_PART_A_CLAIM_FILED_DATE
|
Date
FHA Part A Claim Was Filed With HUD
|
MM/DD/YYYY
|
|
FHA_PART_A_CLAIM_AMT
|
Amount
of FHA Part A Claim Filed
|
2
|
No
commas(,) or dollar signs ($)
|
FHA_PART_A_CLAIM_PAID_DATE
|
Date
HUD Disbursed Part A Claim Payment
|
MM/DD/YYYY
|
|
FHA_PART_A_CLAIM_PAID_AMT
|
Amount
HUD Paid on Part A Claim
|
2
|
No
commas(,) or dollar signs ($)
|
FHA_PART_B_CLAIM_FILED_DATE
|
Date
FHA Part B Claim Was Filed With HUD
|
MM/DD/YYYY
|
|
FHA_PART_B_CLAIM_AMT
|
Amount
of FHA Part B Claim Filed
|
2
|
No
commas(,) or dollar signs ($)
|
FHA_PART_B_CLAIM_PAID_DATE
|
Date
HUD Disbursed Part B Claim Payment
|
MM/DD/YYYY
|
|
FHA_PART_B_CLAIM_PAID_AMT
|
Amount
HUD Paid on Part B Claim
|
2
|
No
commas(,) or dollar signs ($)
|
VA_CLAIM_FILED_DATE
|
Date
VA Claim Was Filed With the Veterans Admin
|
MM/DD/YYYY
|
|
VA_CLAIM_PAID_DATE
|
Date
Veterans Admin. Disbursed VA Claim Payment
|
MM/DD/YYYY
|
|
VA_CLAIM_PAID_AMT
|
Amount
Veterans Admin. Paid on VA Claim
|
2
|
No
commas(,) or dollar signs ($)
|
Exhibit 2: Standard File Codes - Delinquency Reporting |
The
Loss
Mit Type
field
should show the approved Loss Mitigation Code as follows:
· |
ASUM-Approved
Assumption
|
· |
BAP-Borrower
Assistance Program
|
· |
CO-
Charge Off
|
· |
DIL-
Deed-in-Lieu
|
· |
FFA-
Formal Forbearance Agreement
|
· |
MOD-
Loan Modification
|
· |
PRE-
Pre-Sale
|
· |
SS-
Short Sale
|
· |
MISC-Anything
else approved by the PMI or Pool
Insurer
|
NOTE:
Xxxxx
Fargo Bank will accept alternative Loss Mitigation Types to those above,
provided that they are consistent with industry standards. If Loss Mitigation
Types other than those above are used, the Servicer must supply Xxxxx Fargo
Bank
with a description of each of the Loss Mitigation Types prior to sending
the
file.
The
Occupant
Code
field
should show the current status of the property code as follows:
· |
Mortgagor
|
· |
Tenant
|
· |
Unknown
|
· |
Vacant
|
The
Property
Condition
field
should show the last reported condition of the property as follows:
· |
Damaged
|
· |
Excellent
|
· |
Fair
|
· |
Gone
|
· |
Good
|
· |
Poor
|
· |
Special
Hazard
|
· |
Unknown
|
Exhibit 2: Standard File Codes - Delinquency Reporting, Continued |
The
FNMA
Delinquent Reason Code
field
should show the Reason for Delinquency as follows:
Delinquency
Code
|
Delinquency
Description
|
001
|
FNMA-Death
of principal mortgagor
|
002
|
FNMA-Illness
of principal mortgagor
|
003
|
FNMA-Illness
of mortgagor’s family member
|
004
|
FNMA-Death
of mortgagor’s family member
|
005
|
FNMA-Marital
difficulties
|
006
|
FNMA-Curtailment
of income
|
007
|
FNMA-Excessive
Obligation
|
008
|
FNMA-Abandonment
of property
|
009
|
FNMA-Distant
employee transfer
|
011
|
FNMA-Property
problem
|
012
|
FNMA-Inability
to sell property
|
013
|
FNMA-Inability
to rent property
|
014
|
FNMA-Military
Service
|
015
|
FNMA-Other
|
016
|
FNMA-Unemployment
|
017
|
FNMA-Business
failure
|
019
|
FNMA-Casualty
loss
|
022
|
FNMA-Energy
environment costs
|
023
|
FNMA-Servicing
problems
|
026
|
FNMA-Payment
adjustment
|
027
|
FNMA-Payment
dispute
|
029
|
FNMA-Transfer
of ownership pending
|
030
|
FNMA-Fraud
|
031
|
FNMA-Unable
to contact borrower
|
INC
|
FNMA-Incarceration
|
Exhibit
3: Calculation
of Realized Loss/Gain Form 332- Instruction Sheet
NOTE:
Do not net or combine items. Show all expenses individually and all credits
as
separate line items. Claim packages are due on the remittance report date.
Late
submissions may result in claims not being passed until the following month.
The
Servicer is responsible to remit all funds pending loss approval and /or
resolution of any disputed items.
The
numbers on the 332 form correspond with the numbers listed
below.
Liquidation
and Acquisition Expenses:
1. |
The
Actual Unpaid Principal Balance of the Mortgage Loan. For documentation,
an Amortization Schedule from date of default through liquidation
breaking
out the net interest and servicing fees advanced is
required.
|
2. |
The
Total Interest Due less the aggregate amount of servicing fee that
would
have been earned if all delinquent payments had been made as agreed.
For
documentation, an Amortization Schedule from date of default through
liquidation breaking out the net interest and servicing fees advanced
is
required.
|
3. |
Accrued
Servicing Fees based upon the Scheduled Principal Balance of the
Mortgage
Loan as calculated on a monthly basis. For documentation, an Amortization
Schedule from date of default through liquidation breaking out
the net
interest and servicing fees advanced is
required.
|
4-12. |
Complete
as applicable. Required
documentation:
|
*
For
taxes and insurance advances - see page 2 of 332 form - breakdown required
showing period
of
coverage, base tax, interest, penalty. Advances prior to default require
evidence of servicer efforts to recover advances.
*
For
escrow advances - complete payment history
(to
calculate advances from last positive escrow balance forward)
*
Other
expenses - copies of corporate advance history showing all payments
*
REO
repairs > $1500 require explanation
*
REO
repairs >$3000 require evidence of at least 2 bids.
*
Short
Sale or Charge Off require P&L supporting the decision and
WFB’s approved Officer Certificate
*
Unusual
or extraordinary items may require further documentation.
13. The
total
of lines 1 through 12.
Credits:
14-21. Complete
as applicable. Required documentation:
*
Copy of
the HUD 1 from the REO sale. If a 3rd
Party
Sale, bid instructions and Escrow
Agent / Attorney
Letter
of
Proceeds
Breakdown.
*
Copy of
EOB for any MI or gov't guarantee
*
All
other credits need to be clearly defined on the 332
form
22.
|
The
total of lines 14 through 21.
|
Please Note: |
For
HUD/VA loans, use line (18a) for Part A/Initial proceeds and line
(18b)
for Part B/Supplemental proceeds.
|
Total
Realized Loss (or Amount of Any Gain)
23. |
The
total derived from subtracting line 22 from 13. If the amount represents
a
realized gain, show
the amount in parenthesis ( ).
|
Exhibit 3A: Calculation of Realized Loss/Gain Form 332 |
Prepared
by: __________________ Date:
_______________
Phone:
______________________ Email
Address:_____________________
Servicer
Loan No.
|
Servicer
Name
|
Servicer
Address
|
XXXXX
FARGO BANK, N.A. Loan No._____________________________
Borrower's
Name: _________________________________________________________
Property
Address: _________________________________________________________
Liquidation
Type: REO Sale
3rd
Party Sale Short
Sale Charge
Off
Was
this loan granted a Bankruptcy deficiency or cramdown Yes No
If
“Yes”,
provide deficiency or cramdown amount
_______________________________
Liquidation
and Acquisition Expenses:
(1)
|
Actual
Unpaid Principal Balance of Mortgage Loan
|
$
______________
|
(1)
|
|
(2)
|
Interest
accrued at Net Rate
|
________________
|
(2)
|
|
(3)
|
Accrued
Servicing Fees
|
________________
|
(3)
|
|
(4)
|
Attorney's
Fees
|
________________
|
(4)
|
|
(5)
|
Taxes
(see page 2)
|
________________
|
(5)
|
|
(6)
|
Property
Maintenance
|
________________
|
(6)
|
|
(7)
|
MI/Hazard
Insurance Premiums (see page 2)
|
________________
|
(7)
|
|
(8)
|
Utility
Expenses
|
________________
|
(8)
|
|
(9)
|
Appraisal/BPO
|
________________
|
(9)
|
|
(10)
|
Property
Inspections
|
________________
|
(10)
|
|
(11)
|
FC
Costs/Other Legal Expenses
|
________________
|
(11)
|
|
(12)
|
Other
(itemize)
|
________________
|
(12)
|
|
Cash
for Keys__________________________
|
________________
|
(12)
|
||
HOA/Condo
Fees_______________________
|
________________
|
(12)
|
||
______________________________________
|
________________
|
(12)
|
||
Total
Expenses
|
$_______________
|
(13)
|
||
Credits:
|
||||
(14)
|
Escrow
Balance
|
$
_______________
|
(14)
|
|
(15)
|
HIP
Refund
|
________________
|
(15)
|
|
(16)
|
Rental
Receipts
|
________________
|
(16)
|
|
(17)
|
Hazard
Loss Proceeds
|
________________
|
(17)
|
|
(18)
|
Primary
Mortgage Insurance / Gov’t Insurance
|
________________
|
(18a)
|
|
HUD Part A |
________________
|
(18b)
|
||
HUD Part B | ||||
(19)
|
Pool
Insurance Proceeds
|
________________
|
(19)
|
|
(20)
|
Proceeds
from Sale of Acquired Property
|
________________
|
(20)
|
|
(21)
|
Other
(itemize)
|
________________
|
(21)
|
|
_________________________________________
|
________________
|
(21)
|
||
Total
Credits
|
$________________
|
(22)
|
||
Total
Realized Loss (or Amount of Gain)
|
$________________
|
(23)
|
||
Escrow
Disbursement Detail
Type
(Tax
/Ins.)
|
Date
Paid
|
Period
of Coverage
|
Total
Paid
|
Base
Amount
|
Penalties
|
Interest
|
EXHIBIT
X-1
Standard
File Layout - Master Servicing
|
||||
SER_INVESTOR_NBR
|
A
value assigned by the Servicer to define a group of loans.
|
|
Text
up to 10 digits
|
20
|
LOAN_NBR
|
A
unique identifier assigned to each loan by the investor.
|
|
Text
up to 10 digits
|
10
|
SERVICER_LOAN_NBR
|
A
unique number assigned to a loan by the Servicer. This may be different
than the LOAN_NBR.
|
|
Text
up to 10 digits
|
10
|
BORROWER_NAME
|
The
borrower name as received in the file. It is not separated by first
and
last name.
|
|
Maximum
length of 30 (Last, First)
|
30
|
SCHED_PAY_AMT
|
Scheduled
monthly principal and scheduled interest payment that a borrower
is
expected to pay, P&I constant.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
NOTE_INT_RATE
|
The
loan interest rate as reported by the Servicer.
|
4
|
Max
length of 6
|
6
|
NET_INT_RATE
|
The
loan gross interest rate less the service fee rate as reported
by the
Servicer.
|
4
|
Max
length of 6
|
6
|
SERV_FEE_RATE
|
The
servicer's fee rate for a loan as reported by the Servicer.
|
4
|
Max
length of 6
|
6
|
SERV_FEE_AMT
|
The
servicer's fee amount for a loan as reported by the Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
NEW_PAY_AMT
|
The
new loan payment amount as reported by the Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
NEW_LOAN_RATE
|
The
new loan rate as reported by the Servicer.
|
4
|
Max
length of 6
|
6
|
ARM_INDEX_RATE
|
The
index the Servicer is using to calculate a forecasted
rate.
|
4
|
Max
length of 6
|
6
|
ACTL_BEG_PRIN_BAL
|
The
borrower's actual principal balance at the beginning of the processing
cycle.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
ACTL_END_PRIN_BAL
|
The
borrower's actual principal balance at the end of the processing
cycle.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
BORR_NEXT_PAY_DUE_DATE
|
The
date at the end of processing cycle that the borrower's next payment
is
due to the Servicer, as reported by Servicer.
|
|
MM/DD/YYYY
|
10
|
SERV_CURT_AMT_1
|
The
first curtailment amount to be applied.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SERV_CURT_DATE_1
|
The
curtailment date associated with the first curtailment amount.
|
|
MM/DD/YYYY
|
10
|
CURT_ADJ_
AMT_1
|
The
curtailment interest on the first curtailment amount, if
applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SERV_CURT_AMT_2
|
The
second curtailment amount to be applied.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SERV_CURT_DATE_2
|
The
curtailment date associated with the second curtailment
amount.
|
|
MM/DD/YYYY
|
10
|
CURT_ADJ_
AMT_2
|
The
curtailment interest on the second curtailment amount, if
applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SERV_CURT_AMT_3
|
The
third curtailment amount to be applied.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SERV_CURT_DATE_3
|
The
curtailment date associated with the third curtailment
amount.
|
|
MM/DD/YYYY
|
10
|
CURT_ADJ_AMT_3
|
The
curtailment interest on the third curtailment amount, if
applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
PIF_AMT
|
The
loan "paid in full" amount as reported by the Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
PIF_DATE
|
The
paid in full date as reported by the Servicer.
|
|
MM/DD/YYYY
|
10
|
|
|
|
Action
Code Key: 15=Bankruptcy, 30=Foreclosure, , 60=PIF, 63=Substitution,
65=Repurchase, 70=REO
|
2
|
ACTION_CODE
|
The
standard FNMA numeric code used to indicate the default/delinquent
status
of a particular loan.
|
|||
INT_ADJ_AMT
|
The
amount of the interest adjustment as reported by the
Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SOLDIER_SAILOR_ADJ_AMT
|
The
Soldier and Sailor Adjustment amount, if applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
NON_ADV_LOAN_AMT
|
The
Non Recoverable Loan Amount, if applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
LOAN_LOSS_AMT
|
The
amount the Servicer is passing as a loss, if applicable.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SCHED_BEG_PRIN_BAL
|
The
scheduled outstanding principal amount due at the beginning of
the cycle
date to be passed through to investors.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SCHED_END_PRIN_BAL
|
The
scheduled principal balance due to investors at the end of a processing
cycle.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SCHED_PRIN_AMT
|
The
scheduled principal amount as reported by the Servicer for the
current
cycle -- only applicable for Scheduled/Scheduled Loans.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
SCHED_NET_INT
|
The
scheduled gross interest amount less the service fee amount for
the
current cycle as reported by the Servicer -- only applicable for
Scheduled/Scheduled Loans.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
ACTL_PRIN_AMT
|
The
actual principal amount collected by the Servicer for the current
reporting cycle -- only applicable for Actual/Actual
Loans.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
ACTL_NET_INT
|
The
actual gross interest amount less the service fee amount for the
current
reporting cycle as reported by the Servicer -- only applicable
for
Actual/Actual Loans.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
PREPAY_PENALTY_
AMT
|
The
penalty amount received when a borrower prepays on his loan as
reported by
the Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
PREPAY_PENALTY_
WAIVED
|
The
prepayment penalty amount for the loan waived by the
servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
|
|
|
|
|
MOD_DATE
|
The
Effective Payment Date of the Modification for the loan.
|
|
MM/DD/YYYY
|
10
|
MOD_TYPE
|
The
Modification Type.
|
|
Varchar
- value can be alpha or numeric
|
30
|
DELINQ_P&I_ADVANCE_AMT
|
The
current outstanding principal and interest advances made by
Servicer.
|
2
|
No
commas(,) or dollar signs ($)
|
11
|
EXHIBIT
X-2
Exhibit: Standard
File Layout - Delinquency Reporting
|
Column/Header
Name
|
Description
|
Decimal
|
Format
Comment
|
SERVICER_LOAN_NBR
|
A
unique number assigned to a loan by the Servicer. This may be different
than the LOAN_NBR
|
|
|
LOAN_NBR
|
A
unique identifier assigned to each loan by the originator.
|
|
|
CLIENT_NBR
|
Servicer
Client Number
|
||
SERV_INVESTOR_NBR
|
Contains
a unique number as assigned by an external servicer to identify
a group of
loans in their system.
|
|
|
BORROWER_FIRST_NAME
|
First
Name of the Borrower.
|
||
BORROWER_LAST_NAME
|
Last
name of the borrower.
|
||
PROP_ADDRESS
|
Street
Name and Number of Property
|
|
|
PROP_STATE
|
The
state where the property located.
|
|
|
PROP_ZIP
|
Zip
code where the property is located.
|
|
|
BORR_NEXT_PAY_DUE_DATE
|
The
date that the borrower's next payment is due to the servicer at
the end of
processing cycle, as reported by Servicer.
|
MM/DD/YYYY
|
|
LOAN_TYPE
|
Loan
Type (i.e. FHA, VA, Conv)
|
|
|
BANKRUPTCY_FILED_DATE
|
The
date a particular bankruptcy claim was filed.
|
MM/DD/YYYY
|
|
BANKRUPTCY_CHAPTER_CODE
|
The
chapter under which the bankruptcy was filed.
|
|
|
BANKRUPTCY_CASE_NBR
|
The
case number assigned by the court to the bankruptcy
filing.
|
|
|
POST_PETITION_DUE_DATE
|
The
payment due date once the bankruptcy has been approved by the
courts
|
MM/DD/YYYY
|
|
BANKRUPTCY_DCHRG_DISM_DATE
|
The
Date The Loan Is Removed From Bankruptcy. Either by Dismissal,
Discharged
and/or a Motion For Relief Was Granted.
|
MM/DD/YYYY
|
|
LOSS_MIT_APPR_DATE
|
The
Date The Loss Mitigation Was Approved By The Servicer
|
MM/DD/YYYY
|
|
LOSS_MIT_TYPE
|
The
Type Of Loss Mitigation Approved For A Loan Such As;
|
||
LOSS_MIT_EST_COMP_DATE
|
The
Date The Loss Mitigation /Plan Is Scheduled To End/Close
|
MM/DD/YYYY
|
|
LOSS_MIT_ACT_COMP_DATE
|
The
Date The Loss Mitigation Is Actually Completed
|
MM/DD/YYYY
|
|
FRCLSR_APPROVED_DATE
|
The
date DA Admin sends a letter to the servicer with instructions
to begin
foreclosure proceedings.
|
MM/DD/YYYY
|
|
ATTORNEY_REFERRAL_DATE
|
Date
File Was Referred To Attorney to Pursue Foreclosure
|
MM/DD/YYYY
|
|
FIRST_LEGAL_DATE
|
Notice
of 1st legal filed by an Attorney in a Foreclosure Action
|
MM/DD/YYYY
|
|
FRCLSR_SALE_EXPECTED_DATE
|
The
date by which a foreclosure sale is expected to occur.
|
MM/DD/YYYY
|
|
FRCLSR_SALE_DATE
|
The
actual date of the foreclosure sale.
|
MM/DD/YYYY
|
|
FRCLSR_SALE_AMT
|
The
amount a property sold for at the foreclosure sale.
|
2
|
No
commas(,) or dollar signs ($)
|
EVICTION_START_DATE
|
The
date the servicer initiates eviction of the borrower.
|
MM/DD/YYYY
|
|
EVICTION_COMPLETED_DATE
|
The
date the court revokes legal possession of the property from the
borrower.
|
MM/DD/YYYY
|
|
LIST_PRICE
|
The
price at which an REO property is marketed.
|
2
|
No
commas(,) or dollar signs ($)
|
LIST_DATE
|
The
date an REO property is listed at a particular price.
|
MM/DD/YYYY
|
|
OFFER_AMT
|
The
dollar value of an offer for an REO property.
|
2
|
No
commas(,) or dollar signs ($)
|
OFFER_DATE_TIME
|
The
date an offer is received by DA Admin or by the Servicer.
|
MM/DD/YYYY
|
|
REO_CLOSING_DATE
|
The
date the REO sale of the property is scheduled to close.
|
MM/DD/YYYY
|
|
REO_ACTUAL_CLOSING_DATE
|
Actual
Date Of REO Sale
|
MM/DD/YYYY
|
|
OCCUPANT_CODE
|
Classification
of how the property is occupied.
|
|
|
PROP_CONDITION_CODE
|
A
code that indicates the condition of the property.
|
|
|
PROP_INSPECTION_DATE
|
The
date a property inspection is performed.
|
MM/DD/YYYY
|
|
APPRAISAL_DATE
|
The
date the appraisal was done.
|
MM/DD/YYYY
|
|
CURR_PROP_VAL
|
The
current "as is" value of the property based on brokers price opinion
or
appraisal.
|
2
|
|
REPAIRED_PROP_VAL
|
The
amount the property would be worth if repairs are completed pursuant
to a
broker's price opinion or appraisal.
|
2
|
|
If
applicable:
|
|
|
|
DELINQ_STATUS_CODE
|
FNMA
Code Describing Status of Loan
|
||
DELINQ_REASON_CODE
|
The
circumstances which caused a borrower to stop paying on a loan.
Code
indicates the reason why the loan is in default for this
cycle.
|
||
MI_CLAIM_FILED_DATE
|
Date
Mortgage Insurance Claim Was Filed With Mortgage Insurance
Company.
|
MM/DD/YYYY
|
|
MI_CLAIM_AMT
|
Amount
of Mortgage Insurance Claim Filed
|
No
commas(,) or dollar signs ($)
|
|
MI_CLAIM_PAID_DATE
|
Date
Mortgage Insurance Company Disbursed Claim Payment
|
MM/DD/YYYY
|
|
MI_CLAIM_AMT_PAID
|
Amount
Mortgage Insurance Company Paid On Claim
|
2
|
No
commas(,) or dollar signs ($)
|
POOL_CLAIM_FILED_DATE
|
Date
Claim Was Filed With Pool Insurance Company
|
MM/DD/YYYY
|
|
POOL_CLAIM_AMT
|
Amount
of Claim Filed With Pool Insurance Company
|
2
|
No
commas(,) or dollar signs ($)
|
POOL_CLAIM_PAID_DATE
|
Date
Claim Was Settled and The Check Was Issued By The Pool
Insurer
|
MM/DD/YYYY
|
|
POOL_CLAIM_AMT_PAID
|
Amount
Paid On Claim By Pool Insurance Company
|
2
|
No
commas(,) or dollar signs ($)
|
FHA_PART_A_CLAIM_FILED_DATE
|
Date
FHA Part A Claim Was Filed With HUD
|
MM/DD/YYYY
|
|
FHA_PART_A_CLAIM_AMT
|
Amount
of FHA Part A Claim Filed
|
2
|
No
commas(,) or dollar signs ($)
|
FHA_PART_A_CLAIM_PAID_DATE
|
Date
HUD Disbursed Part A Claim Payment
|
MM/DD/YYYY
|
|
FHA_PART_A_CLAIM_PAID_AMT
|
Amount
HUD Paid on Part A Claim
|
2
|
No
commas(,) or dollar signs ($)
|
FHA_PART_B_CLAIM_FILED_DATE
|
Date
FHA Part B Claim Was Filed With HUD
|
MM/DD/YYYY
|
|
FHA_PART_B_CLAIM_AMT
|
Amount
of FHA Part B Claim Filed
|
2
|
No
commas(,) or dollar signs ($)
|
FHA_PART_B_CLAIM_PAID_DATE
|
Date
HUD Disbursed Part B Claim Payment
|
MM/DD/YYYY
|
|
FHA_PART_B_CLAIM_PAID_AMT
|
Amount
HUD Paid on Part B Claim
|
2
|
No
commas(,) or dollar signs ($)
|
VA_CLAIM_FILED_DATE
|
Date
VA Claim Was Filed With the Veterans Admin
|
MM/DD/YYYY
|
|
VA_CLAIM_PAID_DATE
|
Date
Veterans Admin. Disbursed VA Claim Payment
|
MM/DD/YYYY
|
|
VA_CLAIM_PAID_AMT
|
Amount
Veterans Admin. Paid on VA Claim
|
2
|
No
commas(,) or dollar signs ($)
|
Standard File Codes - Delinquency Reporting |
The
Loss
Mit Type
field
should show the approved Loss Mitigation Code as follows:
· |
ASUM-Approved
Assumption
|
· |
BAP-Borrower
Assistance Program
|
· |
CO-
Charge Off
|
· |
DIL-
Deed-in-Lieu
|
· |
FFA-
Formal Forbearance Agreement
|
· |
MOD-
Loan Modification
|
· |
PRE-
Pre-Sale
|
· |
SS-
Short Sale
|
· |
MISC-Anything
else approved by the PMI or Pool
Insurer
|
NOTE:
Xxxxx
Fargo Bank will accept alternative Loss Mitigation Types to those above,
provided that they are consistent with industry standards. If Loss Mitigation
Types other than those above are used, the Servicer must supply Xxxxx Fargo
Bank
with a description of each of the Loss Mitigation Types prior to sending
the
file.
The
Occupant
Code
field
should show the current status of the property code as follows:
· |
Mortgagor
|
· |
Tenant
|
· |
Unknown
|
· |
Vacant
|
The
Property
Condition
field
should show the last reported condition of the property as follows:
· |
Damaged
|
· |
Excellent
|
· |
Fair
|
· |
Gone
|
· |
Good
|
· |
Poor
|
· |
Special
Hazard
|
· |
Unknown
|
Exhibit 2: Standard File Codes - Delinquency Reporting, Continued |
The
FNMA
Delinquent Reason Code
field
should show the Reason for Delinquency as follows:
Delinquency
Code
|
Delinquency
Description
|
001
|
FNMA-Death
of principal mortgagor
|
002
|
FNMA-Illness
of principal mortgagor
|
003
|
FNMA-Illness
of mortgagor’s family member
|
004
|
FNMA-Death
of mortgagor’s family member
|
005
|
FNMA-Marital
difficulties
|
006
|
FNMA-Curtailment
of income
|
007
|
FNMA-Excessive
Obligation
|
008
|
FNMA-Abandonment
of property
|
009
|
FNMA-Distant
employee transfer
|
011
|
FNMA-Property
problem
|
012
|
FNMA-Inability
to sell property
|
013
|
FNMA-Inability
to rent property
|
014
|
FNMA-Military
Service
|
015
|
FNMA-Other
|
016
|
FNMA-Unemployment
|
017
|
FNMA-Business
failure
|
019
|
FNMA-Casualty
loss
|
022
|
FNMA-Energy
environment costs
|
023
|
FNMA-Servicing
problems
|
026
|
FNMA-Payment
adjustment
|
027
|
FNMA-Payment
dispute
|
029
|
FNMA-Transfer
of ownership pending
|
030
|
FNMA-Fraud
|
031
|
FNMA-Unable
to contact borrower
|
INC
|
FNMA-Incarceration
|
Exhibit 2: Standard File Codes - Delinquency Reporting, Continued |
The
FNMA
Delinquent Status Code
field
should show the Status of Default as follows:
Status
Code
|
Status
Description
|
09
|
Forbearance
|
17
|
Pre-foreclosure
Sale Closing Plan Accepted
|
24
|
Government
Seizure
|
26
|
Refinance
|
27
|
Assumption
|
28
|
Modification
|
29
|
Charge-Off
|
30
|
Third
Party Sale
|
31
|
Probate
|
32
|
Military
Indulgence
|
43
|
Foreclosure
Started
|
44
|
Deed-in-Lieu
Started
|
49
|
Assignment
Completed
|
61
|
Second
Lien Considerations
|
62
|
Veteran’s
Affairs-No Bid
|
63
|
Veteran’s
Affairs-Refund
|
64
|
Veteran’s
Affairs-Buydown
|
65
|
Chapter
7 Bankruptcy
|
66
|
Chapter
11 Bankruptcy
|
67
|
Chapter
13 Bankruptcy
|
EXHIBIT
X-3
Exhibit
: Calculation
of Realized Loss/Gain Form 332- Instruction Sheet
NOTE:
Do not net or combine items. Show all expenses individually and all credits
as
separate line items. Claim packages are due on the remittance report date.
Late
submissions may result in claims not being passed until the following month.
The
Servicer is responsible to remit all funds pending loss approval and /or
resolution of any disputed items.
The
numbers on the 332 form correspond with the numbers listed
below.
Liquidation
and Acquisition Expenses:
1. |
The
Actual Unpaid Principal Balance of the Mortgage Loan. For documentation,
an Amortization Schedule from date of default through liquidation
breaking
out the net interest and servicing fees advanced is
required.
|
2. |
The
Total Interest Due less the aggregate amount of servicing fee that
would
have been earned if all delinquent payments had been made as agreed.
For
documentation, an Amortization Schedule from date of default through
liquidation breaking out the net interest and servicing fees advanced
is
required.
|
3. |
Accrued
Servicing Fees based upon the Scheduled Principal Balance of the
Mortgage
Loan as calculated on a monthly basis. For documentation, an Amortization
Schedule from date of default through liquidation breaking out
the net
interest and servicing fees advanced is
required.
|
4-12. |
Complete
as applicable. Required
documentation:
|
*
For
taxes and insurance advances - see page 2 of 332 form - breakdown required
showing period
of
coverage, base tax, interest, penalty. Advances prior to default require
evidence of servicer efforts to recover advances.
*
For
escrow advances - complete payment history
(to
calculate advances from last positive escrow balance forward)
*
Other
expenses - copies of corporate advance history showing all payments
*
REO
repairs > $1500 require explanation
*
REO
repairs >$3000 require evidence of at least 2 bids.
*
Short
Sale or Charge Off require P&L supporting the decision and
WFB’s approved Officer Certificate
*
Unusual
or extraordinary items may require further documentation.
13. The
total
of lines 1 through 12.
Credits:
14-21. Complete
as applicable. Required documentation:
*
Copy of
the HUD 1 from the REO sale. If a 3rd
Party
Sale, bid instructions and Escrow
Agent / Attorney
Letter
of
Proceeds
Breakdown.
*
Copy of
EOB for any MI or gov't guarantee
*
All
other credits need to be clearly defined on the 332
form
22.
|
The
total of lines 14 through 21.
|
Please Note: |
For
HUD/VA loans, use line (18a) for Part A/Initial proceeds and
line (18b)
for Part B/Supplemental
proceeds.
|
Total
Realized Loss (or Amount of Any Gain)
23. |
The
total derived from subtracting line 22 from 13. If the amount represents
a
realized gain, show
the amount in parenthesis ( ).
|
Exhibit 3A: Calculation of Realized Loss/Gain Form 332 |
Prepared
by: __________________ Date:
_______________
Phone:
______________________ Email
Address:_____________________
Servicer
Loan No.
|
Servicer
Name
|
Servicer
Address
|
XXXXX
FARGO BANK, N.A. Loan No._____________________________
Borrower's
Name: _________________________________________________________
Property
Address: _________________________________________________________
Liquidation
Type: REO Sale
3rd
Party Sale Short
Sale Charge
Off
Was
this loan granted a Bankruptcy deficiency or cramdown Yes No
If
“Yes”,
provide deficiency or cramdown amount
_______________________________
Liquidation
and Acquisition Expenses:
(1)
|
Actual
Unpaid Principal Balance of Mortgage Loan
|
$
______________
|
(1)
|
|
(2)
|
Interest
accrued at Net Rate
|
________________
|
(2)
|
|
(3)
|
Accrued
Servicing Fees
|
________________
|
(3)
|
|
(4)
|
Attorney's
Fees
|
________________
|
(4)
|
|
(5)
|
Taxes
(see page 2)
|
________________
|
(5)
|
|
(6)
|
Property
Maintenance
|
________________
|
(6)
|
|
(7)
|
MI/Hazard
Insurance Premiums (see page 2)
|
________________
|
(7)
|
|
(8)
|
Utility
Expenses
|
________________
|
(8)
|
|
(9)
|
Appraisal/BPO
|
________________
|
(9)
|
|
(10)
|
Property
Inspections
|
________________
|
(10)
|
|
(11)
|
FC
Costs/Other Legal Expenses
|
________________
|
(11)
|
|
(12)
|
Other
(itemize)
|
________________
|
(12)
|
|
Cash
for Keys__________________________
|
________________
|
(12)
|
||
HOA/Condo
Fees_______________________
|
________________
|
(12)
|
||
______________________________________
|
________________
|
(12)
|
||
Total
Expenses
|
$
_______________
|
(13)
|
||
Credits:
|
||||
(14)
|
Escrow
Balance
|
$
_______________
|
(14)
|
|
(15)
|
HIP
Refund
|
________________
|
(15)
|
|
(16)
|
Rental
Receipts
|
________________
|
(16)
|
|
(17)
|
Hazard
Loss Proceeds
|
________________
|
(17)
|
|
(18)
|
Primary
Mortgage Insurance / Gov’t Insurance
|
________________
|
(18a)
|
|
HUD Part A | ________________ | (18b) | ||
HUD
Part B
|
||||
(19)
|
Pool
Insurance Proceeds
|
________________
|
(19)
|
|
(20)
|
Proceeds
from Sale of Acquired Property
|
________________
|
(20)
|
|
(21)
|
Other
(itemize)
|
________________
|
(21)
|
|
_________________________________________
|
________________
|
(21)
|
||
Total
Credits
|
$________________
|
(22)
|
||
Total
Realized Loss (or Amount of Gain)
|
$________________
|
(23) |
Escrow
Disbursement Detail
Type
(Tax
/Ins.)
|
Date
Paid
|
Period
of
Coverage
|
Total
Paid
|
Base
Amount
|
Penalties
|
Interest
|